Delhaize posts third-quarter loss but Food Lion sales improve
SALISBURY — Food Lion parent company Delhaize Group, an international grocer based in Belgium, had a net loss of about $112 million for the third quarter, but sales volumes improved at both Food Lion and sister chain Hannaford.
“We delivered solid results in the U.S. during the third quarter. Food Lion continued to show good momentum as reflected in the fourth consecutive quarter of positive volume and comparable store sales growth,” said Pierre-Olivier Beckers, president and CEO of Delhaize Group.
Price cuts at both Salisbury-based Food Lion and Maine-based Hannaford results in lower profits in the third quarter.
Delhaize’s worldwide revenues of $7.1 billion were flat with the same period a year ago. In the U.S., sales of $4.4 billion were up by more than 2 percent, and same-store sales also increased.
The results do not include the Sweetbay, Harveys and Reid’s banners, which Delhaize is selling to Bi-Lo for $265 million. Delhaize said the deal is likely to close in the first quarter of 2014, rather than the fourth quarter of 2013 as expected.
The rebranding effort that has led to better performance for Food Lion will begin its fifth and final phase this week at stores along the North Carolina and South Carolina coasts. Food Lion has launched a new marketing strategy at rebranded stores — “easy, fresh and affordable.”
The third-quarter loss was unexpected and came as Delhaize wrote down the value of its business in Serbia.
“The general economic situation in Serbia worsened significantly, impacting the group’s short- to mid-term expectations for its Serbian operations and resulting in an impairment indicator,” Delhaize said in a statement.
Beckers has handed over his position to former Metro AG executive Frans Muller.
“Since joining the company a few weeks ago, Frans has spent a lot of time at our various European and American operations and has already brought a lot of energy to the group,” Beckers said. “His experience in food retail combined with continued positive momentum in the Group and our solid balance sheet strengthens my confidence in the future of Delhaize Group.”