Ahold raises FY outlook after Q2 operating income beat
AMSTERDAM, Aug 11 (Reuters) - Grocery store operator Ahold Delhaize NV reported on Wednesday a better-than-expected quarterly operating income despite slowing pandemic-driven demand, and raised its financial guidance for the full year.
Second-quarter operating income fell to 817 million euros ($957 million) from 1.04 billion euros a year earlier when pandemic lockdowns were the most severe.
Analysts were expecting Ahold, which operates stores in the United States and Europe, to post an operating income of 750 million euros.
"While communities across our markets reopened during Q2, food-at-home demand remained very resilient," Chief Executive Officer Frans Muller said in a statement.
"Many of the habits formed by consumers during the COVID-19 pandemic in 2020 are proving sticky."
Sales were down 2.4% to 18.65 billion euros, but rose at constant exchange rates, given the weakness of the U.S. dollar. Ahold does two thirds of its business in the United States under brands such as Food Lion, Stop & Shop and Giant.
The company's European stores performed better, with sales up 3.6% at constant exchange rates to 7.53 billion euros, on the back of strength in its Dutch Albert Heijn chain, its online store Bol.com, and in the Czech Republic.
Analysts had seen almost flat sales in Europe, where the rollout of COVID-19 vaccines lagged about two months behind that in the United States.
Ahold raised its full-year forecasts for operating margins to 4.3% from at least 4% estimated in May, and for per-share earnings growth vs. 2019 levels of the "high teens" range, from the low- to mid-teens range.
The company said it believed a comparison between 2019 and 2021 was helpful as 2020 was "so exceptional".
Shares closed at 26.85 euros on Tuesday, up 16% for the year-to-date. ($1 = 0.8533 euros) (Reporting by Toby Sterling; Editing by Muralikumar Anantharaman and Subhranshu Sahu)
