Delhaize Group Posts Improved Q3
Improving sales trends at Food Lion and a “best-in-class performance” by Hannaford in the Northeast contributed to increased U.S. sales for Brussels, Belgium-based Delhaize Group.
“In addition to the implementation of the new pricing strategy started at the beginning of the year, as included in our New Game Plan, over these past few months, our teams have worked relentlessly to strengthen Food Lion’s strategy as a clearly differentiated retailer in its markets,” said Pierre-Olivier Beckers, president and CEO of Delhaize Group. “A number of additional key strategic sales building initiatives will start to be more visible to our customers as from the second quarter of 2011. This work will be substantially completed by the end of 2012 and will be largely financed by the EUR 500 million [US $689 million] gross savings previously announced. Our improved third quarter results, our plans for the rest of the year and the trends we see today, enable us to confirm our 2010 full year operating profit growth guidance as issued on August 13, 2010.”
While Delhaize U.S. revenues decreased by 0.8 percent in local currency to USD $4.7 billion (EUR 3.7 billion), its comparable store sales increased from -3.6 percent for the third quarter last year to -1.8 percent in 2010. Revenue and volume trends improved in the Southeast U.S., partly supported in the second part of the quarter by increased promotional activity at Food Lion. The company’s Hannaford operations had an outstanding quarter posting real net growth, the retailer said.
Private brand revenues continued to increase and now stand at approximately 27 percent of revenues for Delhaize U.S. operating companies, an increase of almost 1 percent over last year. Operating profit decreased by 6.5 percent in local currency for the quarter.
At the end of September 2010, Delhaize operated 1,605 supermarkets in the U.S.