Belgian grocer Delhaize Group saw first quarter profit decline as it said it invested in strategic repositioning initiatives.
The retailer said today (4 May) that net profit fell 2.9% to EUR126m (US$187.3m), while revenue was down 0.7% to EUR5bn.
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Delhaize said that comparable-store sales trends improved for the third consecutive quarter in its US, narrowing to a 0.3% decline. In its home market, Belgium, comparable-store sales were flat. Meanwhile, it said that its Greek operations, Alfa Beta, managed to “gain strong market share in an overall declining market”.
“Our cost savings projects, on track to achieve EUR500 million gross annual savings by the end of 2012, continue to deliver the fuel to fund the many projects of the New Game Plan. Despite these ongoing cost reductions achieved across all banners, the first quarter of 2011 was, as planned, impacted by expenses incurred for key strategic initiatives that will bear fruit as from later this year,” said president and CEO Pierre-Olivier Beckers.
Beckers added that the company today relaunched around 200 of its US Food Lion stores in the Raleigh and Chattanooga markets, which will serve as the first phase of the “fundamental re-positioning work focused on the brand elements of price, assortment and shopping experience”. The retailer plans to take what it learns from these stores into repositioning the majority of its Food Lion stores by the end of 2012.
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