Ahold Delhaize Q1: +2.9% driven by Netherlands

Date : 10 May 2017

Ahold Delhaize has released its Q1 results, reporting that pro forma net sales increased by 2.9% to €15.8bn. Pro forma underlying operating income increased by 8.1% to €604m.

Synergies: ‘on track’

The retailer also noted that the integration of the Ahold and Delhaize business was ‘on track’, resulting in net synergies of €56m. Over 60% of these synergies came from America, with the rest coming from Europe and the Global Support Office. This is expected to build over the coming years, with Ahold Delhaize targeting synergies of €500m in 2019.

Ahold USA: -1.4%, Delhaize USA +0.1%

Ahold USA’s Q1 pro forma net sales decreased by 1.4% to €5.96bn, while comparable net sales excluding gas decreased by 1.8%. The Company expects sales performance in the second quarter to improve.

Highlights from this period included ‘partnering with local produce farms’, enhancing stores by ‘tailoring and optimizing range and space allocation per store’ and improving price perceptions. In the online division, ‘Peapod improved operational performance’, PodPass helped encouraged frequency and Hannaford opened its 35th To Go collection point.

Meanwhile, Delhaize USA’s Q1 pro forma net sales increased by 0.1% to €3.94bn, with comparable net sales flat year on year.

Highlights from this period included positive volumes and‘competitive price positions. In other developments, the retailer continued to roll out its Easy, Fresh & Affordable strategy in Greensboro and will move on to Richmond in the second half of the year. Elsewhere, Food Lion strengthened its ‘store base, preparing for new competition’.

Netherlands: +3.9%, online & store innovation

The retailer’s Dutch business saw Q1 pro forma growth of 3.9% to €3.29bn. Comparable net sales increased by 3.3%, maintaining a positive sales trend. During this period, there was ‘continued strong online net consumer sales growth’. Meanwhile, ah.nl was voted the best online grocery store in the country.

Highlights from this period also included ‘the launch of Appie Today, Albert Heijn’s social channel with customers and associates on YouTube’. Albert Heijn also enjoyed positive performance, driven by the roll out of new formats and product innovation.

Belgium: -1.1%, store refurbishment underway

Meanwhile, in Belgium Q1 pro forma net sales decreased by 1.1% to €1.18bn. Comparable net sales also remained negative at -0.6%, although this was an improvement versus the previous quarter. The retailer cited a weaker performance in integrated supermarkets’.

During the year, 120 company owned and affiliate stores. Meanwhile, during the first quarter, GoodCook workshops were encouraged to promote healthy eating.

Central & Southern Europe +4.4% driven by Romania & Serbia

Elsewhere, in Central & Southern Europe, Q1 pro forma net sales increased by 4.4% at constant exchange rates to €1.38bn.

Although comparable net sales excluding gas was positive at 1.5%, this follows the declining trend of previous quarters. Romania and Serbia helped to drive the positive performance, while Greece saw lower comparable sales growth due to ‘market contraction and competition strengthening’.

Recently, Greek retailers including Ahold Delhaize announced investment programmes in the market.

Highlights from the first quarter included the introduction of the‘Taste of Czech’ private label range in the Czech Republic, as well as the opening of the 300th Shop & Go store in Serbia. Meanwhile in Romania, the retailer has run a successful ‘SuperLunch’ campaign, promoting ‘healthy and tasty meals for kids’.