THE NETHERLANDS: Ahold Delhaize Ends Year On Strong Note

Ahold Delhaize has reported strong sales growth for its fourth quarter and fiscal full year, and said the integration of the two groups is making good progress.

For the quarter, pro forma sales were down 1% to €15.5bn (-2.2% constant-currency basis), although adjusted for calendar shifts, they grew by 2.8%. Meanwhile, operating profit fell by 10.2% to €501m (-11.5% constant-currency), but on an underlying basis, it was down 3.9% to €608m (-5.1% constant-currency).

The results meant full-year pro-forma sales were up 2.4% to €62.3bn (+3.4% constant-currency, calendar-adjusted), while underlying operating profit was up 6.6% to €2.3bn (+6.3% constant-currency).

Sales at Ahold USA were up 0.5% to €25.8bn (0.5% constant-currency, calendar-adjusted) while Delhaize America recorded a 1.9% rise to €17.2bn (1.9% constant-currency, calendar-adjusted). Meanwhile, in The Netherlands, sales were up 3.2% to €13.1bn, Belgium recorded a 1.7% increase to €4.9bn, and sales in Central and Southeastern Europe were up 8% to €5.6bn.

Dick Boer, CEO of Ahold Delhaize, said: “I am very pleased with the financial results in the fourth quarter with volume growth and strong margins, while making good progress implementing our Better Together strategy which we announced in December. Our teams are working hard on the integration, leveraging best practices and realising synergy targets”.

Boer said the group’s “strong free cash flow of €1.4bn” will help it to “continue to fund growth in key channels, as well as to return excess liquidity to our shareholders”.

NAM Implications:
  • Given the retailer’s focus on financial performance and shareholder returns, there are real opportunities for NAMs that can convert investment cost into demonstrable value by relating any concession to direct impact on the Ahold Delhaize Balance Sheet and P&L