Ahold Delhaize reports a strong quarter with full-year underlying earnings per share up 29.6%
· Net sales of €16.5 billion, up 3.0% at constant exchange rates
· Net consumer online sales up 25.0% at constant exchange rates
· Operating income of €627 million, up 9.1% at constant exchange rates
· Underlying operating margin of 4.2%, up 0.2% points, supported by synergies
· Performance in the U.S. continued good momentum, underlying operating margin up 0.2% points
· Solid growth in the Netherlands, with bol.com net consumer sales up 32.3%
· New strategy in Belgium gaining traction, with sales growth and margin recovery
· Free cash flow €2.3 billion, up 24.0% at constant exchange rates
· Underlying income per share* €1.60, up 29.6% at constant exchange rates
· Proposed dividend of €0.70, up 11.1% compared to 2017
* from continuing operations
Zaandam, the Netherlands, February 27, 2019 - Ahold Delhaize, one of the world's largest food retail groups and a leader in both supermarkets and eCommerce, reports a strong fourth quarter with 29.6% growth of full-year underlying earnings per share from continuing operations, at constant exchange rates.
Frans Muller, President and CEO of Ahold Delhaize, said: "In 2018 we essentially completed the merger integration process and delivered on the synergies we promised. At the same time, we continued our strong business performance, while investing in meeting the needs of our customers in a rapidly changing industry. Today, Ahold Delhaize is fit for the future, with a very robust financial profile and the right structure to further grow our brands, both in-store and online.
"With our Leading Together strategy in place, our focus turns to further strengthening our great local brands by accelerating investments in omnichannel growth, technology, and a healthy and sustainable offering to customers. The Save for Our Customers program will support the funding of our investments in future profitable growth.
"Total net consumer online sales reached €3.5 billion in 2018, growing by 24.8% at constant exchange rates, and is firmly on track to double to around €7 billion in 2021. Throughout our business we are adding capacity and developing and sharing digital capabilities to stay ahead and meet increasing customer expectations regarding range, speed and convenience.
"In the U.S. we continued to see good momentum in the financial performance across the brands. We are excited about the program to refresh the look and feel of our Stop & Shop brand and the rapid expansion of our Click and Collect options for our customers. In addition, Food Lion reported its 25th quarter of positive comparable sales and volumes, supported by the rollout of its 'Easy, Fresh and Affordable' program.
"In the Netherlands Albert Heijn reported another solid quarter and bol.com continued its strong consumer sales growth during the year, reaching €2.1 billion with positive EBITDA margins. The new strategy for our Delhaize brand in Belgium is gaining traction, reflected by both improved sales performance and margin recovery in 2018. In Central and Southeastern Europe, we expanded our store network by 130 stores in 2018, mainly in Romania and Greece, and continued to see a strong performance in the Czech Republic.
"With synergy savings of €432 million in 2018 and a run-rate of €120 million in the last quarter, we are close to our target of €500 million net synergies on an annual basis. For 2019, we expect to realize €540 million of cost savings, which allows us to invest in organic and inorganic growth while keeping group margins in line with 2018.
"For the full year we delivered a strong free cash flow of €2.3 billion, supported by further improvements in net working capital. We expect free cash flow for 2019 of around €2.0 billion, with capital expenditure of €2.0 billion. We will return €1 billion through our share buyback program for 2019 and are pleased to propose a €0.70 dividend to our shareholders, an increase of 11.1% compared to 2017, reflecting of our ambition of sustainable growth of the dividend per share. For 2019 we expect underlying income per share from continuing business to grow by high single digits as a percentage."