by Bernardo Lopez FoodBizDaily.com
March 11 2010 - After dropping 22.9% operating profit, supermarket Delhaize was able to exceed its full-year profit guidance. Delhaize has reported 4.2% profit to $1.18bn.
Due to fluctuations in exchange rates, Delhaize’s fourth quarter of 2009 had them falling from EUR288.7m to EUR223m. Had it not been for currency fluctuations, the company stresses that they would have only fallen 1.4%.
Delhaize’s store sales fell 0.4% in the U.S, but gained 2.7% in Belgium. Their revenues gained 2.6% total during the full-year last year, giving them a total profit of EUR19.93bn in 2009.
President and CEO of Delhaize Pierre-Olivier Beckers stated “In the U.S., our operating companies experienced a marked improvement of the volume trends as a result of targeted price investments and adapted assortments, in part financed by better inventory management results and a more favorable product mix. Delhaize Belgium had a very strong year, with solid market share growth combined with great execution and better inventory control.”
Delhaize cut EUR100m in costs and EUR50m in working capital improvements while investing in lowering prices during the fiscal year. According to the operating margin for 2009 was at 4.7%.
In 2010, however, Delhaize says that they expect to have a growth in operating profit between 7-10%, lead by their “New Game Plan”.
“From the beginning of 2010 we have started to execute our New Game Plan, which is our strategic plan focused on accelerated growth, increased efficiencies and stronger intra-Group integration,” says Beckers, adding “All of our operating companies have started to fine-tune their pricing strategies to achieve local value leadership, and we are gearing up for many other projects, including achieving EUR300m of annual operating cost savings by 2012. We are ready for the challenges of 2010.”
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DELHAIZE GROUP
Address: Square Marie Curie 40 Brussels, 1070 Belgium
Telephone: +32-2-4122211
Fax: +32-2-4122222
About DELHAIZE GROUP
Delhaize Group is a Belgian international food retailer with activities in seven countries on three continents. The principal operational activity of Delhaize Group is the operation of food supermarkets in North America, Europe and Southeast Asia. Delhaize Group’s sales network also includes other store formats, such as proximity stores and specialty stores. In addition to food retailing, Delhaize Group engages in food wholesaling to stores in its sales network and in retailing of non-food products, such as pet products. At December 31, 2008, Delhaize Group’s sales network consisted of 2,673 stores. At December 31, 2008, Delhaize Group operated companies in seven countries on three continents: the United States, Europe and Asia. These companies are grouped into four segments: the United States, Belgium, Greece and the Rest of the World. On February 14, 2008, Delhaize Group acquired P.L.Logistics Center-Dianomes-Apothikefsis - Logistics. On September 1, 2008, it acquired La Fourmi.