Ahold reports Q3 profit decline

November 18, 2010 | 20:19

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Dutch retailer Ahold reported on Thursday an 8.6 per cent drop in third quarter net profit, a result worse than predicted by analysts in spite of higher sales.

The group's net result was 223 million euros ($304 million), lower than 240 million euros predicted by analysts polled by Dow Jones Newswires.

Net sales rose 10.8 per cent from a year earlier to 6.69 billion euros, Ahold said in a statement.

Restructuring costs in the United States and the integration of newly acquired businesses, particularly that of American group Ukrop, impacted negatively on the results, Ahold spokesman Jochem van de Laarschot told AFP.

Ahold announced in February that its acquisition of 25 Ukrop stores in the United States, for an amount of $140 million, had been concluded successfully.

Ahold owns nearly 3,000 stores and employs about 140,000 people in 11 countries in Europe and North America.

Van de Laarschot declined to comment on media speculation that Ahold was considering selling Dutch retailer Hema, a high-profile name in the Netherlands.

British investment firm Lion Capital said in September that it was considering selling Hema, which employs about 10,000 people, and has annual net turnover of 1.1 billion euros with 530 shops in five countries -- the Netherlands, Belgium, Luxemburg, Germany and France.

Ahold stock dropped more than three per cent to 9.60 euros on the Amsterdam exchange shortly after opening.

In the United States, where Ahold operates stores like Stop and Shop and Giant, net sales rose 15,1 per cent to 4.08 billion euros, benefiting from a favourable dollar exchange rate.

In the Netherlands, where Ahold dominates the medium- and large-scale distribution sector with its multitude of Albert Heijn stores, net sales rose 5.8 per cent to 2.2 billion euros.

AFP

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