Ahold Fourth-Quarter Profit Jumps 75% on Sales, Cost Reduction
Royal Ahold NV (AH), the Dutch owner of Stop & Shop grocery stores, said fourth-quarter profit jumped 75 percent as revenue increased and one-time costs fell.
Net income advanced to 270 million euros ($360 million) from 154 million euros a year earlier, the Amsterdam-based company said in a statement. Analysts expected net income of 253.5 million euros, according to the average of six predictions in a Bloomberg survey. Ahold said in January that sales rose 4.5 percent to 7.3 billion euros in the period.
``We are pleased with our performance in the fourth quarter, delivering solid results in the United States and the Netherlands,’’ Chief Executive Officer Dick Boer said in the statement. At the same time, ``we expect 2012 to be another challenging year for the food retail industry. The macro- economic environment means that consumers still continue to look for value and competition will remain intense.’’
Boer, who took the helm in March 2011, is planning to boost Ahold’s online business, expand in Belgium and add convenience stores to reverse slowing sales growth. Ahold said Feb. 27 it plans to acquire online retailer Bol.com for 350 million euros to boost Internet sales.
Ahold, which owns Albert Heijn stores in the Netherlands, also plans to cut costs by an additional 350 million euros over three years and increase the proportion of earnings paid as dividends. For 2011 the company is planning a payout of 40 cents a share, a 38 percent increase.
The company’s Giant Food Stores agreed to buy 16 Genuardi’s outlets from Safeway Inc. (SWY) for $106 million in January to expand in the Philadelphia area.
The stock declined 0.7 percent to 10.38 euros yesterday in Amsterdam, paring its 12-month gain to 6.5 percent.
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