Dutch supermarket giant Ahold today (1 August) booked a rise in second-quarter sales at constant exchange rates thanks to its strategy of lowering prices to attract customers.
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The Albert Heijn operator revealed that revenues totalled EUR5.78bn (US$9.03bn) for the three-month period.
With about half its sales coming from the US, the strength of the euro against the dollar has hit Ahold’s results. Compared to the second quarter of last year, net sales decreased by 0.8% but increased by 7.3% with the impact of currency exchange stripped out.
“In Europe and the United States, sales growth was supported by investments in price positioning and strong promotional activities in all markets,” Ahold said.
Over the past two years Ahold has revamped its US stores, cutting prices and introducing more private-label products. This strategy has begun to pay dividends as US shoppers respond to the global economic slowdown and look to save money.
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By GlobalDataThe company said that these investments should continue to have a positive impact on sales and margins at its US stores in the second half of the year.
Ahold reiterated its 4.8-5.3% underlying retail operating margin target. This contrasts with lowered outlooks from US competitors such as Safeway.
