Supermarket operator Ahold nudges up 2021 outlook
AMSTERDAM, Nov 10 (Reuters) - Ahold Delhaize, a major supermarket chain operator, increased its full-year forecast on Wednesday after reporting third-quarter earnings at the high end of expectations.
Third-quarter underlying operating income of 812 million euros ($938 million) was at top of the range provided by 21 analysts to the company, which owns the Stop & Shop, Giant, Food Lion and Hannaford chains.
Ahold reported sales of 18.5 billion euros in the three-month period, which compares with an average forecast of 18 billion by analysts.
"We saw a very strong third quarter where you saw higher sales, earnings and free cash flow, that led us to say with good confidence that we're able to increase our guidance for the rest of the year," Ahold CFO Natalie Knight said in an interview.
In the United States, Ahold's largest market, comparable sales excluding gasoline increased 2.9%, while in Europe comparable sales excluding gasoline declined by 0.2%.
Group online sales grew 29.2% at constant currency rates.
"The one I am most proud of is if you look at the two-year comparative sales in the U.S. - they are up 15%. There is a lot of momentum, actually more than in Q1 and Q2. Not only have we learned a lot from the pandemic, but we are also gaining (market) share."
Ahold lifted the 2021 underlying operating margin outlook by 0.1% to 4.4%, while underlying earnings per share (EPS) forecast on a pre-pandemic basis was nudged up to growth "in the low- to mid-20s range relative to 2019, versus high-teen growth previously."
The 2021 free cash flow outlook was increased to 1.7 billion euros from 1.6 billion euros.
Knight said she expected price inflation to remain at around current levels, but that the company would continue to try to avoid passing that on to customers.
($1 = 0.8655 euros) (Reporting by Anthony Deutsch; Editing by Sherry Jacob-Phillips and Louise Heavens)
