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Ahold Delhaize’s digital sales soar in Q4

The retailer reported that, excluding its recent FreshDirect acquisition, online sales in the United States grew by 7.5%.

Still facing the headwinds of the pandemic, Ahold Delhaize shared strong fourth-quarter results.

The Dutch grocer reported that U.S. net sales increased by 1.5% at constant exchange rates (5.9% at actual exchange rates). Excluding last year's 53rd week, Q4 U.S. net sales grew by 9.2% at constant exchange rates. U.S. comparable sales, excluding gasoline, increased 4.8%.

The company said that unfavorable weather negatively impacted its fourth-quarter U.S. comparable sales by approximately 0.2 percentage points. On a two-year comparable sales stack basis, growth was 16.%, accelerating from the 15.3% growth in the third quarter. 

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Brand performance continued to be led by Food Lion, which has now delivered 37 consecutive quarters of positive sales growth, the company said.

Ahold Delhaize saw online sales in the segment increase 30.5% in constant currency for the quarter. The company attributed the growth to the continued expansion of click-and-collect facilities and its FreshDirect acquisition.

Excluding the FreshDirect acquisition, U.S. online sales grew 7.5% in constant currency, building on top of the significant 128.5% growth in the same quarter last year, according to the company.

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“We ended 2021 on a strong note, with positive Group Q4 comparable sales momentum and stable Group margins, positioning us for a strong start to the next phase of our Leading Together strategy announced last November,” Frans Muller, president and CEO of Ahold Delhaize, said. “Looking back on the past year, I am most proud of how associates brought our values to life in the way they responded to ongoing developments associated with COVID-19 and natural disasters throughout our brands' markets, including major floods in Belgium, tornadoes in the Czech Republic, fires in Greece and Hurricane Ida in the U.S. Through it all, associates rose to the challenge to care for customers and communities. As a result, we enter 2022 with deeper relationships and trust across our brands' markets and stronger market shares to build upon.”

The underlying operating margin in the U.S. was 4.4%, up .5% points at constant exchange rates from the prior year period. This growth was driven by reduced COVID-19-related costs and strong cost-savings initiatives, the company said. 

While the absence of one-time costs in the prior year quarter was offset by lapping last year's extra week, in the fourth quarter the U.S. underlying operating margins benefited by .3% points from a favorable reserve release. In the fourth quarter, U.S. IFRS-reported operating margin was 5.5%.

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“Our financial results in 2021 significantly exceeded our original expectations, with positive full-year comparable sales growth and stable 52-week comparable underlying earnings compared to record results in 2020. This was despite supply chain challenges, increasing inflationary pressures and the dilutive effect as we continue to rapidly expand our omnichannel proposition,” Muller said. “Our investment in our omnichannel platform once again proved its worth during 2021, with group net consumer online sales growing by more than 38% compared to 2020, representing a two-year stack growth of more than 105%. This positively impacted our 2021 Group net sales, which, at €75.6 billion, remained elevated — up 3.3% versus 2020 at constant rates.”

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