Q1 U.S. sales flat but operations improving at Ahold
ZAANDAM, The Netherlands – Ahold on Wednesday posted first quarter net sales of $7.6 billion (7 billion Euros) across its U.S. operations, representing an increase of 19.9% that was driven in part by a strong U.S. dollar. Ahold's U.S. operations actually generated 2.1% fewer net sales at constant exchange rates.
"In the U.S., our sales were effected by falling gas prices. Gas prices were down 35% vs. last year, so overall our sales declined 2.1%," commented Jeff Carr, Ahold CFO. "However, when you exclude gas, sales grew by 0.4%," he said. "Our team in the U.S. continues to invest in intiaties to improve our customer proposition. And I'm pleased that for the third quarter running, we achieved volume marketshare gains. Also, we continue to see improvements in our price perception."
"In the U.S., we saw further benefits from our improved customer proposition, which we have continued to roll out to more stores during the quarter, resulting in an increased volume market share," offered Dick Boer, Ahold CEO. "Our business performance remains on track to deliver in line with full year expectations. We continue to execute our Reshaping Retail strategy, offering quality and value to our customers."
The adverse impact of the timing of Easter was partly offset by favorable weather conditions across the footprints of its Stop & Shop and Giant Carlisle banners – sales were up as a consequence of high snowfall levels during the quarter in those markets.
This quarter, the first wave of Ahold's program to improve its customer proposition was rolled out to another 183 stores, bringing the total to 704 stores, and the next waves are being deployed in all divisions. The results of the program continue to show positive sales trends across all market areas, with improved identical sales performance versus the previous quarter, adjusted for Easter.
Ahold continues to focus on growing its own-brand penetration across the businesses, the company said. Thanks to double-digit growth of Ahold's Nature’s Promise natural and organic and Simply Enjoy premium brands, private-label penetration reached 37.7%.
During the quarter, Ahold USA announced a restructuring of its support offices, which is to be completed by early summer 2015.