ZAANDAM, Netherlands -- Multinational supermarket operator and food-service distributor Ahold here last week said it would refrain from any major acquisitions in the next year and would divest some of its non-core operations.
In a conference call discussing the company's second-quarter earnings, Cees van der Hoeven, president and chief executive officer, said the company was not looking at anything "major" to divest.
"We're looking at our non-core businesses, looking at the things on the fringes of our business" that could improve the company's profitability, he said.
The company, which operates several supermarket chains in the eastern United States, posted a quarterly loss for the first time since 1973. It attributed the loss to the 410 million Euro charge (about $400 million) related to the buyout of its joint-venture partner in Argentina.
"Fortunately, the reasons are entirely incidental and largely unrelated to performance," van der Hoeven said.
Ahold's loss for the period totaled 197.5 million Euros ($193.5 million), on sales of 17.27 billion Euros ($16.92 billion), compared with net income of 323.8 million Euros ($321.7 million) on sales of 16.1 billion Euros ($15.78 billion) in the year-ago period.
In the United States, the company singled out Stop & Shop, Quincy, Mass.; Giant Food, Landover, Md.; and Giant Food, Carlisle, Pa., as performing well during the quarter, despite "lackluster consumer demand in the sector." The company also said Bruno's, Birmingham, Ala., was "delivering on plan" and Bi-Lo, Greenville, S.C., was seeing some improvements, although operating earnings at Bi-Lo were still lower than last year. Peapod, the company's U.S. Internet arm, had a 19% increase in sales and operating losses of $7.6 million, which is less than the division lost last year.
Total retail sales in the U.S. in the second quarter were $6.16 billion, up 14.1% over year-ago levels. Operating earnings were $364.6 million, up 22.8%. Through the first two quarters, U.S. retail sales were up 15.2%, to $14.07 billion, and operating earnings were up 25.6%, to $790.5 million, compared a year ago.
