Dutch retail giant Ahold posted a 12.2% increase in full-year operating profit today (2 March) and boosted its annual dividend.
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The operator of the Stop & Shop and Giant grocery chains saw operating income reach EUR1.2bn in 2008.
Retail operating income was EUR1.3bn with underlying retail operating margins reaching 5%. This was in line with the 4.8% to 5.3% guidance Ahold gave for 2008.
Net sales were up 3.3% to EUR25.7bn compared to the previous year. At constant exchange rates, net sales increased by 6.9%.
Net income, however, fell to EUR1.1bn, down EUR1.9bn compared to 2007, which included a EUR2bn gain on divestments.
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By GlobalDataCEO John Rishton said Ahold’s performance for 2008 was a “solid” one and increased the company’s annual dividend by 12% to EUR0.18 per common share.
“We recognise that in the current conditions we may need to adjust the balance between sales, market share, profits and cash even more rapidly than we have in the past,” Rishton said.
“Consequently, we will work to balance these elements in the near-term to ensure we are able to deliver our longer-term goals of sustainable 5% sales growth and 5% retail operating margin.”
Ahold’s Stop & Shop and Giant stores posted full-year net sales of US$17.1bn, up 2.4% compared to last year.
Identical sales were up 2.4% at Stop & Shop and down 0.4% at Giant-Landover.
The company’s Albert Heijn stores in the Netherlands reported net sales of EUR9bn, up 12.9% on the previous year. Identical sales were up 9.2%.
In the fourth quarter, Ahold’s net profit was EUR285m, up from EUR260m in the same period a year earlier and boosted by recent restructuring programmes.
Operating income jumped 49% to EUR365m. Sales rose 13% to EUR6.6bn.
Ahold shares were up 2.6% at EUR9.09 at 11:02 CET today.
