Supermarket group Ahold Delhaize has raised its annual outlook for the third time this year, saying that it expects low-double-digit earnings per share growth versus a prior mid-single-digit guidance.
The company also posted a solid increase in sales and earnings in the third quarter, with group net sales rising by 9.1% at constant exchange rates to €22.4 billion.
Comparable sales for the quarter (excluding gasoline) rose by 8.2% in the US and by 7.4% in Europe, reflecting 'strong loyalty to our locally tailored customer value propositions', the group said.
United States Performance
Despite rising macro-economic and geopolitical challenges, Ahold Delhaize is benefiting from a strong performance in its biggest market, the United States, where it operates the Stop & Shop, Giant, Food Lion and Hannaford chains.
"Better-than-expected underlying U.S. results, foreign exchange benefits, and continued insurance gains from rising interest rates allow us to raise our full year diluted underlying EPS guidance to low-double-digit growth," CEO Frans Muller said in a statement.
Ahold Delhaize's net sales in the U.S. reached €14.7 billion in the third quarter, an increase of 8.8% at constant exchange rates.
European Performance
In Europe, net sales came in at €7.7 billion for the quarter, a 9.6% gain at constant exchange rates, with the group noting a slight benefit from its recent acquisition of DEEN in the Netherlands.
Comparable sales in Europe (excluding gasoline) rose by 7.4%, as shelf inflation accelerated during the quarter, the group said. Online sales rose by 6.1% in Europe in the quarter, compared to a 20.1% increase in the corresponding quarter last year.
The group nudged up its annual earnings per share outlook in August for the second time this year.
Ahold Delhaize on Wednesday said its underlying operating income jumped to €993 million between July and September, above the €885 million expected by a company-compiled consensus.
'Making Important Progress'
"In conclusion, despite increasing macro-economic and geopolitical challenges, we continue to make important progress on delivering our strategy," Muller added.
"Operational excellence, tight cost control and disciplined capital allocation continue to be important in these times. As such, we are working hard on a variety of initiatives across the company to maintain our industry-leading position of consistent and reliable performance, dependable cash flows and shareholder returns."
News by Reuters, edited by by ESM – your source for the latest retail news. Click subscribe to sign up to ESM: European Supermarket Magazine.
