Ahold Delhaize has reported ’strong’ second quarter performance with year-on-year net sales growth of 6.4% at constant exchange rates, to €21.4 billion.
Net sales increased by 7.7% in the US and 4.2% in Europe, with increased market share in the majority of markets reflecting strong customer loyalty.
Online sales increased 4.8% year-on-year during the quarter, with the grocery segment witnessing an 11.5% growth as the company continued to invest in creating the leading local omnichannel food experience.
Frans Muller, president and CEO of Ahold Delhaize, said, “Our overall results confirm the strength and breadth of our brand portfolio. Our brands' unparalleled understanding of customers, broad assortments and product offerings as well as the stickiness of food-at-home consumption are giving us the opportunity to play to our strengths and support customers in a challenging environment.”
The company has decided to suspend its intention to launch the IPO of bol.com in the second-half of 2022 and will revisit the matter when equity market conditions are more conducive.
“As such, our immediate priority is to ensure that bol.com continues to leverage its leadership position and execute its strategic growth agenda with a strong return on capital,” Muller added.
Net sales in Europe net amounted to €7.9 billion, benefitting from the 2021 acquisition of 38 stores from DEEN in the Netherlands.
Comparable sales in Europe, excluding gasoline increased 1.8% due in part to a positive impact of approximately 0.7 percentage points from calendar shifts.
Online sales in the region declined by 1.1%, following 27.0% growth in the same period last year.
The company attributed this decline to weak non-food e-commerce market conditions in the Benelux, which contracted at a high-single-digit rate as brick-and-mortar non-food retail sales recovered from prior year lockdown measures.
Underlying operating margin in Europe was 3.4%, down 0.8 percentage points from the prior year due to volume deleveraging, particularly in the Benelux from lapsed benefits of lockdown restrictions, as well as significant price competition in Belgium and Greece, the company noted.
Ahold Delhaize expects mid-single-digit growth in underlying EPS compared to 2021 levels driven by strong half-year earnings as well as other macro-economic, foreign exchange and interest rate factors.
It also cautioned that the current macro-environment trends, including high rates of inflation and rising energy costs, are expected to continue into the second half of the year.
Muller added, “Looking to the future, we remain strongly focused on our ESG ambitions. For a long time, sustainability has had a central position in our organisation. It is one of our four key strategic focus areas, and a critical driver of our purpose: Eat well. Save time. Live better.
“With the recent appointment of Jan Ernst de Groot as our chief sustainability officer, we will ensure that the full scope and dimension of sustainability and ESG are holistically represented at the Executive Committee level.”