Distribucion y Servicios SA (D&S) has reported a massive year-on-year decline in first quarter sales, which dropped to CLP5.32bn (US$10.1m) from CLP9.86bn reported in the first quarter of last year.

Chile's largest grocery retailer attributed the 46.1% decline to a decrease in same-store sales and the increases in costs due to investments made in opening new stores.

"These results are attributable to the decrease in same-store sales this period, as compared to the same period in 2005. Same- store sales are currently showing a more favourable evolution," said Miguel Nuñez, D&S CFO.

"The increase in selling and administrative expenses for this quarter is explained by the investment the company made in opening nine stores throughout Chile in the period April 2005 through March 2006 of the current year," Nuñez added.

First quarter sales reached CLP376.28bn, a 0.1% decrease from sales of CLP376.61bn in Q1 2005. Operating profits took a sharp 22.4% cut, dropping to CLP12.13bn from CLP15.63bn in the same period of last year.