Belgium-based retailer Delhaize has revealed its results for the fourth quarter of 2011, with group revenue climbing but net profit falling on a year-on-year basis.
According to the group, net profit fell 48 per cent to €99m, mainly due to €127m in impairment charges related to its portfolio optimisation that was first announced in January 2012.
Group revenue for the quarter rose 7.6 per cent to €5.6bn, while fourth-quarter group underlying operating margin stood at 4.8 per cent.
'We remained focused on the executionof our New Game Plan throughout 2011, launching a number of growth initiatives across the Group, designed to strengthen the foundation of our business and support its growth potential,' said Pierre-Olivier Beckers, president and chief executive officer of Delhaize Group. 'At Food Lion, where repositioned stores in the Raleigh market recorded positive volume growth since their launch in May 2011, we are determined to move faster with the repositioning of our brand and implement it in 600 to 700 additional stores in 2012.
'During the fourth quarter of 2011, the revenue growth in our other US markets was impacted by our decision topass on cost inflation to retail prices in the face of a very competitive environment,' Beckers continued. 'While soft revenues and costs related to our growth initiatives in the US negatively impacted our fourth quarter results, we are convinced that the projects we are focusing on are the right ones for our company'
For the full-year of 2011, revenue increased by 4.6 per cent, with growth across all operating segments, and underlying profit growth cam in at 18.8 per cent for southeast Europe and Asia.
'Over the course of 2012 we will further improve our price competitiveness in the US and in Belgium, leverage our strong private brands, open more stores, especially in our newer formats and geographies, accelerate our store remodelings in the US and Belgium and focus on delivering value to our customers,' Beckers noted. 'Each ofthese initiatives will support our plan to accelerate revenue growth asdefined by our New Game Plan.
'The previously announced €500m gross annual cost savings target, that we expect to exceed by the end of2012, will in large part fund these initiatives. Finally, our decision earlier this year to close unprofitable stores will enable us to optimise our capital allocation.'
