Delhaize reports drop in 2Q net profit
9 August 2007, BRUSSELS (AP) - Delhaize Group, the Belgian supermarket concern which also owns U.S. Food Lion stores, reported a 35 percent drop in net profit in the second quarter as it paid a one-time charge to refinance its debt and suffered from the weak dollar.
9 August 2007
BRUSSELS (AP) - Delhaize Group, the Belgian supermarket concern which also owns U.S. Food Lion stores, reported a 35 percent drop in net profit in the second quarter as it paid a one-time charge to refinance its debt and suffered from the weak dollar.
Net profit was EUR 62.2 million, down from EUR 96.9 million a year earlier but slightly above forecasts from analysts polled by Dow Jones Newswires who had expected a 39 percent slip.
The company blamed a EUR 103.8 million charge as it refinanced EUR 800,000 in debt for its American subsidiary. It said this restructuring will reduce future financial and tax expenses and improve the group's debt profile.
But exchange rates that see European companies pull in lower earnings from U.S. operations clearly depressed "strong performance" results from Delhaize stores that trade as Food Lion and Hannaford in the U.S.
Overall, Delhaize reported a 0.4 percent drop in net sales to EUR 4.8 billion in the three months ending 30 June. The company said the dollar has fallen by 6.7 percent from the same period last year.
In its Belgian base, the high-end supermarkets pulled in more sales by opening more branches. Delhaize saw stronger growth in Greece where revenues climbed 13 percent. Delhaize now has 2,495 stores in seven countries - including Romania and Indonesia.
In the U.S., it said its Sweetbay stores will continue targeted price and marketing initiatives to deal with "increased competitive activity" in Florida.
[Copyright AP 2007]
Subject: Belgian news