NETHERLANDS: Home comforts for Ahold

By: just-food.com | 6 March 2008

A strong performance at home drove a 6.7% rise in annual profits at Ahold, the Netherlands-based retail giant.

Ahold, which also runs stores in markets including the US and the Czech Republic, booked operating profit of EUR1.1bn (US$1.7bn) for 2007.

Net sales inched up 1.2% to EUR28.2bn, as a weak dollar weighed on turnover. At constant exchange rates, net sales increased by 6.1%.

Ahold's Albert Heijn stores, the company's flagship domestic banner, saw its turnover jump 12.1% to EUR8bn thanks in part to the acquisition of the Konmar stores in late 2006.

Nevertheless, the company's core Albert Heijn outlets weighed in with healthy sales. Identical-store sales at Albert Heijn supermarkets rose 7.9%.

In the US, net sales from Ahold's Stop & Shop and Giant-Landover unit rose 1.5%. Identical-store sales rose 1.3% at Stop & Shop, while sales slipped 1.1% at Giant-Landover.

The company's Giant-Carlisle division saw sales jump 13% to $4.3bn. Identical-store sales rose 3.7%.

At Ahold's stores in the Czech Republic and Slovakia, identical-store sales rose 6.8%, while the business broke even after a loss of EUR55m last year.

CEO John Rishton said the Albert Heijn stores had "exceed expectations".

"Ahold exceeded the targets we set last year," Rishton said. "We delivered an underlying retail operating margin of 4.6% against our 4% to 4.5% guidance."

This year, Ahold is looking to continue to reposition its Stop & Shop and Giant-Landover stores in the US, where the company is looking to focus more on value.

Sectors: Retail

Companies: Ahold