Delhaize Group First Quarter 2012 Results
|Financial Summary (at identical exchange rates)|
|» Revenue growth of 5.9% (2.3% organic growth)|
|» Comparable store sales evolution of -0.6% in the U.S. and -0.9% in Belgium|
|» Double digit revenue growth in Southeastern Europe and Asia even without the positive impact of Delta Maxi acquisition|
|» Group underlying operating margin of 3.5% (at actual exchange rates), impacted by our continuing investment in our growth initiatives, in particular price competitiveness and Bottom Dollar Food|
|» Accelerating revenue momentum and volume growth in Food Lion Phase One stores and in Bottom Dollar Food stores|
|» As a result of our investment behind strategic initiatives in the current environment, 2012 underlying operating profit is expected to decrease by 15% to 20% at identical exchange rates compared to last year|
|» Intensive focus on price competitiveness, cost savings and a target of EUR 500 million free cash flow generation for 2012|
» CEO Comments
Pierre-Olivier Beckers, President and Chief Executive Officer of Delhaize Group, commented: "In the first quarter, we continued to deliver on our New Game Plan by investing in key revenue growth initiatives. These actions resulted in solid revenue growth of 5.9%. Our commitment to price competitiveness, the accelerated revenue momentum in our Food Lion Phase One stores, strong revenue growth at Bottom Dollar Food, real growth in Serbia and the strength of our Alfa Beta brand, give us confidence that our strategy is delivering the intended results."
"These actions and the current trading environment translated into lower underlying operating profit in the first quarter of 2012. In order to fund our long-term growth initiatives and to further invest in our prices in several of our markets, particularly the U.S. and Belgium, we will increase our focus on the generation of free cash flow through a more disciplined approach to capital expenditures and improvements in working capital. In 2012, we have set as a target the generation of EUR 500 million in free cash flow. We are also more determined than ever to exceed our EUR 500 million gross annual cost savings target by the end of this year. I am convinced that these decisions will strengthen the long-term health of our business."
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Source: Delhaize Group via Thomson Reuters ONE