Ahold has announced that operating income fell 7.6 per cent during the fourth quarter (Q4) of 2009, down to €341m from the €369m posted in 2008, with net income dropping 8.2 per cent to €267m from €291m.
Despite growth across all markets, the Netherlands-based retailer said that margins were impacted by deflation, increased promotional activity and trading down by customers during the global economic crisis.
Net sales for the company came in at €6.8bn, an increase of 3.4 per cent, with sales increasing by 11 per cent at constant exchange rates, positively impacted by an additional week.
'In the fourth quarter, we delivered a solid performance in a challenging environment,' said group CEO John Rishton. 'Sales and margins continued to be impacted by deflation, trading down and increased promotions. We successfully managed, however, the balance between sales and margins, and we improved market share and increased volumes in the Netherlands and the United States.'
For the full-year, Ahold said that operating income grew 7.9 per cent to €1.3bn, although net income dropped by 17.4 per cent to €894m from €1.08bn the previous year.
Sales for the 12-month period jumped €8.9 per cent to €27.9bn, growing 6 per cent at constant exchange rates.
The group's Dutch Albert Heijn operation saw fourth-quarter net sales grow 12.3 per cent to €2.5bn, with operating income down €12m to €168m. Full-year results saw net sales rise by 9.7 per cent to €9bn, while operating income increased €7m to €654m.
Elsewhere in Europe, Ahold's Albert/Hypernova segment in the Czech Republic and Slovakia recorded a fall in net sales of 1.8 per cent to €431m through the fourth quarter, with an operating loss of €16m. This contributed to a yearly loss of €76m, with 12-month net sales down 5 per cent to €1.7bn.
In the US, Stop & Shop/Giant Landover recorded fourth quarter net sales of US$4.4bn, up 10.5 per cent, with operating income coming in at US$238m, up US$31m. Full-year sales stood at US$17.9bn, up 4.6 per cent, while operating income was US$869m, up US$168m compared with 2008.
Giant-Carlisle saw net sales increase by 15 per cent to US$1.3bn through the final three months of the year, while operating income dropped US$6m to US$54. For the whole of 2009, the segment's net sales hit US$5bn, up 4.6 per cent, and operating income stood at US$218m, down US$15m year-on-year.
'The economic environment remains challenging, but we have a proven ability to adapt and respond quickly and effectively to changes,' Mr Rishton added. 'We will continue to reduce costs so that we can invest in our offering to improve value for our customers.'
