Ahold Delhaize Sees Dutch Sales Boost In Fourth Quarter
Retailer Ahold Delhaize has posted a 4.3% like-for-like sales increase in the Dutch market in the fourth quarter of its financial year.
The group said that its performance in its home market was driven by a 'successful holiday period', as well as a positive consumer response to Albert Heijn's new commercial campaign.
Net sales in the Dutch market were up 4.5% to €3.98 billion for the period.
In addition, its bol.com online business saw net consumer sales growth of 28.7% in the period.
In Belgium meanwhile, comparable sales were flat (+0.1%) in the period, albeit due to a negative calendar effect.
Ahold Delhaize posted a net sales increase of 0.2% in the Belgian market in the fourth quarter, to €1.34 billion, with its Delhaize banner gaining market share during the quarter.
The Nutri-Plus programme, which provided discounts on thousands of healthy products, also helped drive sales in the period, the group said.
The group's Central and Southeastern Europe division, meanwhile, posted comparable sales growth (excluding gasoline) of 3.6% in the quarter, which was driven by a strong performance in the Czech Republic and Romania.
Net sales were up 5.4% in the division (at constant exchange rates), to €1.69 billion, boosted by the net addd lion of 162 stores to its estate, largely convenience stores.
Ahold Delhaize's biggest division by sales, the US, saw comparable sales growth (excluding gasoline) of 2.3%, with net sales rising 2.7% to €10.37 billion.
However, underlying operating margin at the US business was down 0.4% on the same period last year, due to a 'challenging sales environment' for its Stop & Shop brand, as well as additional investments in the brand.
This was offset by growing margins at Food Lion, Giant/Martin's and Hannaford, the group said.
Group net sales were up 3.1% for the quarter, to €17.4 billon.
"We ended the year on a high note, with strong group performance in the fourth quarter," commented Frans Muller, Ahold Delhaize chief executive. "We exceeded our full-year 2019 guidance outlook for underlying earnings per share and met our free cash flow guidance."
Looking ahead to the coming year, Muller said that while the business is planning to make "significant investments" in 2020 to drive long-term growth, "we expect group underlying operating margin in 2020 to be broadly in line with 2019. We expect mid-single-digit growth in underlying EPS in 2020".
Commenting on Ahold Delhaize's performance, Bruno Monteyne of Bernstein Research said, "[Ahold Delhaize] Q4 had impressive headline beats to expectations: +0.9% ahead of Group sales, +2.3% on underlying EBIT (+6bps margin), and +15.4% on underlying EPS. That is a massive beat for a company that always seems to exceed expectations.
"However we caution against being too excited give the sources of outperformance. Nevertheless the results were very good. Guidance into 2020 also remains cautious."
© 2020 European Supermarket Magazine – your source for the latest retail news. Article by Stephen Wynne-Jones. Click subscribe to sign up to ESM: European Supermarket Magazine