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AMSTERDAM — Royal Ahold's U.S. subsidiary saw net sales jump 2.8% to $7.8 billion during first quarter 2012, the company said Wednesday.
Ahold USA, which consists of such brands as Stop & Shop, Giant Carlisle, Giant Landover, Martin's and Peapod, experienced a 1.4% increase in identical sales (0.1% excluding gasoline), as comparable-store sales were 1.8% for the quarter. Underlying operating margin dropped to 4.1% from 4.6% in the year-ago period. The company attributed last year's solid sales growth to the "favorable timing of Easter (where the relatively low-sales post-Easter week shifted into the second quarter) and good operational execution during adverse weather events."
Commenting on the results, CEO Dick Boer said the company's recent acquisition of 16 Genuardi's stores in the Philadelphia market, as well as the U.S. online grocery shopping business, will help the U.S. subsidiary remain competitive in the market, but noted challenges that lie ahead.
"We continued to invest in competitiveness both in the United States and in Europe with higher levels of promotional activity, resulting in market share gains in the United States and maintaining our market share in the Netherlands," Boer said. "As we said before, we expect 2012 to be another challenging year for the food retail industry, with intense competitive activity and consumer spending under pressure due to economic uncertainty, particularly in Europe. We remain confident that our strong brands are well positioned and are well on track to deliver on our strategy."
Overall, Royal Ahold saw sales rise 9.7% to nearly $12.1 billion, while net profit slid from $363.4 million in first quarter 2011 to $352 million.