Belgium-based retailer Delhaize has booked a drop in full-year underlying profit as investments in price in the US drove sales gains but ate into margins.
The company said that underlying profit fell to EUR753m (US$1.05bn) in the 12 month period, down 4.2%. Excluding currency exchange, underlying profit was down 2.1%.
Go deeper with GlobalData
Delhaize said that underlying operating margin fell to 3.4% in the fourth-quarter, impacted by “continued price investment in the US”. However, the company emphasised that this investment resulted in higher US sales. During the final quarter, Delhaize American saw a 2.8% increase in same-store sales, while Delhaize Belgium booked like-for-like gains of 2.4%.
For the full-year, total sales rose 2.6%, excluding currency exchange, with organic sales growth of 3.1%.
Looking to 2014, Delhaize CEO Frans Muller commented: “In 2014, we will further differentiate our offer and support our core banners by focusing on maintaining or strengthening our local leadership positions. We will pursue operational efficiencies and exercise continued capital discipline in order to fund this.”
Muller said that the group would raise its capital expenditure for the year to EUR625m in order to fund the opening of 180 stores.
US Tariffs are shifting - will you react or anticipate?
Don’t let policy changes catch you off guard. Stay proactive with real-time data and expert analysis.
By GlobalData
