BELGIUM: Delhaize Q4 results boosted by Belgium turnaround | Progresiv
Belgium-based Delhaize has said fourth quarter sales rose 4.9% at identical exchange rates to 6.3 billion euros, with organic revenue growth of 4.9%. Including the additional 53rd week that it enjoyed in the US in 2015 the retailer said that sales 9.1%. While Delhaize’s US operations continued to see a steady growth in sales, the turnaround programme instigated in Belgium appeared to gain traction, with sales up 5.6%. 
After a period of upheaval, which has seen Delhaize trim its store numbers and fascia in the US, the focus on its key Food Lion and Hannaford banners is bearing fruit. In Q4 revenues in the US rose 2.6% to 4.4 billion dollars, driven by comparable store growth of 2.3%. The retailer’s investment in price, under the ongoing ‘Easy, Fresh and Affordable’ initiative, has seen it cut the price of shoppers’ most frequently purchased items, has driven footfall, but led to retail deflation of 1.0% at the banner. In the short term, Delhaize is expected to maintain its investment in price in the US, while extending the reach of its online operations to enable shoppers to purchase and collect their orders as easily as possible.
Although Delhaize flagged the negative impact of ‘disruptions caused by the uncertainty of the Transformation Plan’ during the quarter, the initiatives covered by it appear to be resonating with shoppers, with fourth quarter sales rising by 5.6%, with comparable store stores growth of 5.1%. After a period of market share losses, Delhaize said that the fourth quarter had seen its market share show ‘good progression’ to stand at 24.0% by its own measures. Mirroring steps it has taken in the US, Delhaize’s investment in price, closure of underperforming stores and franchising of others has helped it drive growth in its home market.
In the retailer’s smallest division, which includes its operations in Greece, Romania and Indonesia, it said that revenues rose by 13.3%, 13.5% at identical exchange rates, with comparable store sales of 7.8%. The addition of new stores across all its markets, butespecially Romania where it added 34 net new stores in the fourth quarter alone, helped underpin sales growth. (www.retailanalysis.igd.com)
