BRUSSELS — On the heels of posting its best U.S. annual comparable-store sales gains in a decade, Delhaize Group here will step up store growth in fiscal 2008, particularly in its Food Lion division.
The retailer last week revealed plans to build between 50 and 55 new stores in the U.S. — part of its $750 million capital expenditures forecast for the country, which generates about 65% of the company's total sales. About 45 stores are planned for the Food Lion division, which includes stores under the Food Lion, Bottom Dollar, Bloom and Harveys banners. Delhaize opened 32 new Food Lion units in 2007. Delhaize also said it would build seven new Hannaford stores (the same as in 2007) and four Sweetbay stores (vs. five last year). The group plans nine store closures and nine relocations for a net gain of 32 to 37 stores.
In addition, Delhaize said it would remodel around 150 stores during the year, including 141 as part of Food Lion market renewals in Wilmington, N.C., Richmond, Va., Charlottesville, Va., and Savannah, Ga.
The company also announced sales results from fiscal 2007, showing annual comparable-store increases in the U.S. of 3.8% — “our strongest performance in more than 10 years,” the company said.
U.S. sales of $18.2 billion increased 5.1% from $17.3 billion in 2006. Sales in the fourth quarter increased 5.1% to $4.6 billion, results Delhaize said were supported by market renewals at Food Lion, pricing and innovation at Hannaford, and revenue growth at “most” Sweetbay locations.
Pierre Olivier-Beckers, Delhaize's president and chief executive officer, said the company is anticipating further revenue growth.
“While the economy is far more uncertain than last year, it is also true that strong companies will be able to seize opportunities in such an environment,” Beckers said in a statement.
He said the company is looking to reap benefits of many recent initiatives, including the Sweetbay transformation, the Guiding Stars nutritional navigation system launched at Hannaford, the segmentation work at Food Lion, and On the Go Bistro, a line of chilled prepared meals.