Ahold results disappoint

Related tags United states dollar

Dutch retailer Ahold has said that consolidated sales for the
second quarter of €13.0 billion for its global sales represented a
decline of 12.4 per cent compared to the €14.8 billion generated in
the second quarter 2002. Analysts had been predicting sales of some
€13.12bn but currency fluctuations weighed heavily on the
expectations.

Dutch retailer Ahold has said that consolidated sales for the second quarter of €13.0 billion for its global sales represented a decline of 12.4 per cent compared to the €14.8 billion generated in the second quarter 2002. Analysts had been predicting sales of some €13.12 billion but currency fluctuations weighed heavily on the expectations.

Ahold​ said in a press statement that the trading environment had been difficult, pointing out that despite this, sales excluding currency impact had increased by 2.5 per cent and organic sales growth excluding currency impact amounted to 1.3 per cent.

In the United States, retail sales increased by 1.1 per cent to $6.2 billion. Organic sales growth also amounted to 1.1 per cent. However, comparable sales declined by 1.1 per cent and identical sales declined by 1.9 per cent, reflecting a highly competitive market and slow trading.

Foodservice sales in the United States increased by 0.2 per cent to $4.1 billion (2002: $4.1 billion). Organic sales growth also amounted to 0.2 per cent.

In Europe (The Netherlands, Spain and Central Europe), foodservice sales rose 0.6 per cent to €3.3 billion (2002: €3.2 billion). Organic sales growth, excluding currency impact, amounted to 0.9 per cent.

In South America (Brazil, Argentina, Chile, Peru and Paraguay), sales amounted to €608.7 million (2002: €503.8 million), up 20.8 per cent from last year. The company said that this strong performance was partly due to the fact that Santa Isabel was not consolidated in the second quarter of 2002. Organic sales growth, excluding currency impact, amounted to 11.4 per cent.

In Asia (Thailand, Malaysia, Indonesia), the performance was the most disappointing with sales declining 15.2 per cent to €92.9 million (2002: €109.6 million). Organic sales growth, excluding currency impact, amounted to 2.5 per cent.

Meanwhile controversy over the company's 2002 financial results still continues, with the law courts continuing to probe a €1 billion discrepancy.

Ahold has now said that it has managed to secure an extension for the deadline on its 2002 results with its banks - pushing the deadline from 15 August to 30 September. This is because the internal inspection, being carried out by Deloitte & Touche has taken longer than planned.

Originally the results were supposed to be with Ahold's lender banks - ABN Amro, ING, Rabobank, JP Morgan and Goldman Sachs - as a key condition for the group to be able to access the $915 million ( second unsecured tranche of a €2.65 billion credit facility agreed in March.

In a press statement Ahold said it did not 'foresee the need for drawing on the $915 million (€811m) unsecured tranche based on its current cashflow projections. This reflects Ahold's confidence in its ability to meet its obligations in 2003, including the cash payment in full of Ahold's outstanding €678 million convertible subordinated notes that mature on September 30 2003'.

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