AMSTERDAM (Reuters) - Ahold Delhaize, which operates supermarkets in the United States and Europe, said on Wednesday its first-quarter net income rose 2.4 percent, lifted by solid growth in online sales and the Netherlands.
In April, Ahold had said a strike at Stop & Shop would result in a one-time reduction in underlying operating profit of around $100 million due to lost sales and inventory.
The Dutch-Belgian supermarket operator reiterated on Wednesday that the underlying operating margin for the group for 2019 would be slightly lower that 2018. It expects free cash flow of about 1.8 billion euros in 2019.
Ahold shares traded in Amsterdam were down 1.2 percent in afternoon trading.
The company is on track to meet a U.S. online sales target of 20 percent growth this year, while group online sales are on track to reach 7 billion euros ($7.84 billion) by 2021, up from 3.5 billion euros in 2018, Chief Executive Fans Muller said.
Net income in the three-month period came in at 435 million euros ($487 million) at constant exchange rates. Analysts polled by the company had forecast net income of 440 million euros on average.
Sales rose 1.5 percent to 15.9 billion euros in the quarter, also in line with expectations.
Underlying earnings before interest, taxation, debt and amortization (EBITDA) slipped 0.4 percent to 1.36 billion euros, compared with the same period a year earlier, while Ahold’s free cash flow was negative by 136 million euros “due to the timing of Easter, greater capital expenditure and higher income taxes paid,” the company said.
The strike involved 30,000 workers in Connecticut, Massachusetts and Rhode Island. Ahold said all employees would receive better pay, and those eligible would receive continued health insurance and pension benefits.
The deal would have no impact on Ahold’s goal of reducing its overall costs by 540 million euros ($608 million) in 2019, the company said on Wednesday.
Reporting by Anthony Deutsch, Editing by Sherry Jacob-Phillips and Louise Heavens