Ahold’s Swedish subsidiary ICA saw net income drop in 2010 as the company faced a series of one-off tax charges.
The retailer recorded a 65.5% drop in net income to SEK547m (US$84.7m) as it was charged with SEK747m in tax expenses from a dispute from 2001-2002 and with SEK632 for a write off of a deferred tax asset at ICA Norway.
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Operating income excluding capital gains and impairments was up 13.7% to SEK2.9bn.
Net sales were down 0.8% for the full year to SEK93.8m. However, at constant exchange rates, net sales were up 0.9%.
During the fourth quarter, the company recorded a SEK152m net loss due to the write-off of the deferred tax asset in ICA Norway.
Meanwhile, net sales were down 0.4% to SEK24.4bn during the fourth quarter. At constant exchange rates, sales were up 2.6%.
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By GlobalDataICA president and CEO Kenneth Bengtsson said: “Net sales rose by 0.9% at constant exchange rates despite an increasingly competitive environment in all our markets. This improved operating income was due to the continued positive performance of ICA Sweden and a strong recovery in Rimi Baltic.”
However, Bengtsson was less positive about the retailer’s Norwegian operations. “ICA Norway’s development is a major disappointment. Its lower operating income was primarily a result of exceptional price competition that started in February 2010,” he said.
Click here for the company’s full earnings statement.
