Renewed momentum in America
“Our fourth quarter 2013 sales were strong both in the U.S. and in
Belgium”, CEO Frans Muller said: “In the U.S., where volume growth continued to be positive, we were especially pleased with Food Lion’s
momentum. The phased repositioning, started almost 3 years ago, is meeting
our expectations and we look forward to further develop Food Lion’s customer
proposition this year.”
Analysts and investors were mostly interested in the American results: Dutch Ahold, which like Delhaize
brings in most of its revenue from the United States, had
mentioned “a shrinking American market due to
the government investing less in food stamps“.
Delhaize saw nothing of that: “Comparable store sales grew by 2.8 %
despite retail deflation resulting from our price investments at Food Lion
Phase 4 and Phase 5 stores and at Hannaford. Revenues were particularly strong at Food Lion.” That +2.8 % doubled analysts’ expectations,
even though the numbers do not include Harvey’s and Reid’s (both were sold
beforehand).
Strong Belgian holiday
season
Like-for-like Belgian turnover grew 2.4
% in the fourth quarter, despite “a continuously competitive market”, says
the Dutch successor to Pierre-Olivier Beckers: a clear reference to Dutch newcomer Albert
Heijn and to discounters
Aldi and Lidl. The holiday season sales were very strong, according to the CEO: the group
emphasizes Delhaize Belgium’s market share
remained level compared to 2012: 25.5 %.
Other European markets returned mixed results: “Revenues in Southeastern Europe increased by 4.5 % (both at actual
and identical exchange rates. We experienced positive comparable store sales
growth in Greece and growth by expansion in Romania. This was partially offset
by negative volume growth in Serbia (-0.6 %).”
Yearly turnover of 21.1 billion euro
Revenues for 2013 were 21.1 billion euro (+ 0.6 %), even though turnover growth was stalled by a weakened
dollar: it would have been a 2.6 % increase
at identical exchange rates, while organic revenue growth was 3.1 %. Geographically
speaking turnover mostly came out of the United States (12.9 billion), with
Belgium number 2 (with 5.1 billion) and Southeastern Europe number 3 (3.1
billion).
Based on preliminary unaudited figures, Delhaize expects “underlying operating profit to be approximately
770 million euro at identical exchange rates”, which is well above its
previous estimates of “at least 755 million euro”. These numbers please investors, as its shares
immediately shot up 8 %.
(Translated by Gary Peeters)
