AMSTERDAM — Ahold here said yesterday that a reluctance to pass along cost increases to customers contributed to a decline in profitability at the company, which operates the Stop & Shop, Giant of Landover and Giant of Carlisle chains in the U.S. In the Stop & Shop and Giant-Landover segment, operating income was $125 million, down $36 million from year-ago results, which the company attributed to price investments and one-time charges of $44 million, partially offset by gains on asset sales of $22 million. For the first half, operating income at the two chains fell $62 million, to $327 million. At Giant-Carlisle, operating income was down $10 million for the quarter, to $51 million, and was flat for the half-year span at $123 million. Overall, Ahold’s net income for the quarter was $496 million, down about 85% from year-ago results, which included nearly $3 billion in income from discontinued operations. Net income from continuing operations rose about 4% for the period, to about $260 million. Sales for the quarter slid about 0.8%, to about $8.5 billion, although they were up 7.3% at constant exchange rates, adjusted for the decline in the value of the U.S. dollar. Patrick Roquas, an analyst with Robabank here, said he was “disappointed” in the earnings decline but said the quarter was an aberration because of intense promotional activity. “Despite an underlying first-half margin of 4.65% [earnings before interest and taxes], we regard the fiscal-year target of 4.8%-5.3% as realistic.”
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