Ahold FY earnings come in below expectations, expands share buyback UPDATE |
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Thu, 22 Mar 2007 09:10
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(Updates with operating margin details, divisional breakdown)AMSTERDAM (AFX) - Royal Ahold NV reported earnings came in below analysts expectations, although net profit was higher than consensus.Ahold also said it will expand its previously announced share buyback programme to 3 bln eur from 2 bln -- depending on the sale of US Foodservice.Full-year profit rose to 915 mln eur, higher than the 782.3 mln consensus and up from 159 mln eur in 2005, when earnings were impacted by one-offs.Sales were 44.9 bln eur, up from 44.5 bln but below the expected 45.3 bln consensus, while operating profit was 1.3 bln eur, up from 248 mln but below the forecast of 1.4 bln.Ahold did not provide an update on the progress of the sale of US Foodservice, something many analysts had hoped for.The food retailer set its operating margin growth target at 4-4.5 pct in 2007, the same target it set for 2006.Ahold, however, did not meet its earlier target -- the 2006 operating margin growth was 3.9 pct. Ahold said at the end of last year it expected the margin to come in 'at the low end' of its 4-4.5 pct guidance.US Foodservice met its 1.7 pct operating margin growth target.Sales at US Foodservice were 4.4 bln eur in the fourth quarter of last year, while operating profit was 81 mln eur.Sales at Stop & Shop were 3.8 bln eur in the fourth quarter, while operating profit was 162 mln. Giant-Carlisle/Tops recorded sales of 1.4 bln eur and an an operating loss of 63 mln due to one-off charges.Albert Heijn recorded 1.8 bln eur in sales in the fourth quarter, with an operating profit of 100 mln.Ahold Central Europe sales were 366 mln eur, while operating losses amounted to 16 mln in the fourth quarter. Ahold noted results from its Polish operations were excluded due to the sale of that unit.Schuitema, a Dutch supermarket chain in which Ahold has a majority stake, saw sakes of 750 mln eur and operating profit of 7 mln in the fourth quarter. Ahold said operating profit came in lower due to acquisitions.kaj.leers@thomson.comkel/rfw/kel/ms1COPYRIGHTCopyright AFX News Limited 2007. All rights reserved.The copying, republication or redistribution of AFX News Content, including by framing or similar means, is expressly prohibited without the prior written consent of AFX News.AFX News and AFX Financial News Logo are registered trademarks of AFX News Limited
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Ahold FY earnings come in below expectations, expands share buyback 