Ahold Projected to See 10 Percent Second-Quarter Sales Drop

AMSTERDAM -- Ahold, the embattled Dutch grocery group reeling from a large accounting scandal revealed earlier this year, is expected to unveil a more than 10 percent decline in second-quarter sales when it provides a trading update on Friday.

Analysts expect sales to be lower at US Foodservice, the distribution arm where the bulk of the accounting irregularities occurred, and in the Netherlands, where the Albert Heijn supermarket chain is struggling in a tough market.

It is expected that Ahold's second-quarter sales decline at US Foodservice will exceed the 1.5 percent fall posted in the first quarter, while total sales are forecasted to dip 10.5 percent below the same period in 2002.

Analysts are also hopeful that better news will be forthcoming from rewards of heavy in-store promotions conducted at Ahold's U.S. retail operations, which could translate into trading improvements.

Last Friday, Ahold announced the completion of the sale of supermarket chain Santa Isabel's 76 Chilean stores to Cencosud, Chile's third-largest retail group. The sale fetched $77 million in proceeds.
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