AMSTERDAM — Ahold here said yesterday it was preparing to unveil a significant new program next week at its Stop & Shop and Giant-Landover chains as it winds down the Value Improvement Program.
The move comes as the company reported strong margin expansion at the two chains in the second quarter.
In a conference call with analysts, John Rishton, Ahold’s chief executive officer, said the “fairly major initiative” at Stop & Shop and Giant-Landover is designed to “drive more value” for customers to ensure that the chains continue to grow sales volumes.
One analyst said the plan was likely to involve additional price cuts. “We can only assume it will be further price initiatives to strengthen their already market leading position,” Matthew Truman, a London-based analyst with Normura International, told SN.
In the most recent quarter, Ahold reported that operating income was up 60% at Stop & Shop and Giant-Landover, to $200 million.
Giant of Carlisle, Pa., the company’s third U.S. banner, invested heavily in margin in the quarter to drive sales in a more difficult competitive environment, the company said. Operating income at that banner fell by 6%, to $48 million.
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