BRUSSELS, BELGIUM - Delhaize President and CEO Frans Muller expressed confidence about the Belgium-based retail chain’s current trajectory after it beat street expectations for its fourth quarter of 2015.
“We recorded revenue increase at all our banners. Our underlying operating profit was approximately €870 million ($939,861,000),” Muller said, according to the financial reports, saying that the company stuck to its two-year-old plan to focus on consumer needs and strategic initiatives. “In addition, we generated another solid level of free cash flow this year at approximately €645 million ($696,793,500), excluding one-time elements."
Specific focuses where the company saw growth were its Food Lion banner, which Muller said saw revenue uplift from Easy, Fresh & Affordable.
Highlights for the the fourth quarter of 2015 included:
- Revenue growth of 14.2% at actual exchange rates (excluding the 53rd week in the U.S. in 2014)
- 2.3% comparable store sales growth in the U.S.
- 5.1% comparable store sales growth in Belgium
- 7.8% comparable store sales growth in Southeastern Europe
As we previously reported, the company just announced that it has officially filed for its joint merger with Ahold with the Brussels Commercial Court, the next necessary step before convening the shareholders for Extraordinary General Meetings, which are slated to take place before the first half of this year is out.
“Subject to final approvals, we are looking forward to bringing our operations with good operating momentum and a solid financial structure into a stronger and larger group as we complete the merger with Ahold on schedule by mid-2016," Muller added in regards to the merger, valued at $28 billion.
Overall, the company saw an underlying operating margin of 4.0% in the U.S. in fiscal year 2015, with free cash flow of about €645 million ($696,793,500) excluding one-time elements, €516 million ($557,434,800) including one-time elements.
Following the announcement, Delhaize’s stock was up 3.18% as of Jan. 22 at 4:04 PM EST.
As for 2016, Muller said that the chain plans to fine-tune the Easy, Fresh and Affordable initiative at Food Lion and roll it out to an additional market, as well as improve its Belgian Transformation Plan’s operating standards.
"We are also confident to maintain our sales trends in all our markets in 2016, driven by comparable store sales growth and expansion mainly in Southeastern Europe,” Muller added.
AndNowUKnow will continue to keep you up to date on all retail financial news as the market continues to hold sway in the produce industry.
