Nieuws Binnenland

Ahold 3Q Profit +22%, Beats Views, Plans New Cost Cuts

Woensdag 18 november 2009 07:35 By Maarten van Tartwijk and Anna Marij van der Meulen Of DOW JONES NEWSWIRES
AMSTERDAM (Dow Jones)--Food retailer Royal Ahold NV (AH.AE) Wednesday beat forecasts with a 22% rise in third-quarter net profit, boosted by lower taxes, and said it planned further cost cuts.
Its new program, which will run until 2012 and aims to generate EUR350 million in cost reductions, will focus "on all aspects of our business, including store expenses, supply chain, and overhead across the group", Chief Executive John Rishton said in a statement.
Meanwhile, "we continue to adapt to the challenging environment, balancing sales and margins while seeking to grow market share and volumes", he added.
The latest program builds on a three-year EUR500 million cost-savings plan running to end-2009.
The company said third-quarter net profit rose to EUR238 million from EUR195 million a year ago, mainly due to lower income taxes. Six analysts polled by Dow Jones Newswires had forecast a net profit of EUR181.6 million.
Operating income rose to EUR265 million from EUR261 last year, and the operational retail margin was 4.8%, from 4.9%.
In the U.S, where Ahold generates over half of its sales, operating income at its Stop&Shop/Giant-Landover unit rose 13% to $189 million, while its Giant Carlisle chain reported a 9% drop in operating income to $45 million from $50 million.
The Dutch Albert Heijn unit reported that operating income rose 5% to EUR486 million.
Last month, Ahold posted a smaller-than-expected 4.3% rise in third-quarter sales of EUR6.04 billion.
Ahold's shares closed at EUR9.14 on Tuesday and gained 4.3% year-to-date while the AEX index gained 31.1% this year. Analysts have said Ahold should use its EUR2.6 billion cash pile to boost its lagging share price or it may become a takeover target.

Company Web site: http://www.ahold.com

By Anna Marij van der Meulen; Dow Jones Nieuwsdienst, +31-20-5715 201; annamarij.vandermeulen@dowjones.com