Ahold Q2 Net Profit Up
Cash flow before financing was €5.7 billion positive for the quarter, €5.1 billion better than the same period last year, mainly as a result of the proceeds from the sale of U.S. Foodservice and the company's Polish operations.
30/08/07 Ahold has reported net sales of €6.6 billion in the second quarter of 2007, up 2% from the same period last year. At constant exchange rates, net sales increased by 5.6%.
Operating income was €291 million, €11 million lower than last year, reflecting an adverse currency exchange impact. Retail operating income was €313 million, an operating margin of 4.7%. Core Corporate Center costs were €22 million for the quarter, down €13 million from a year ago.
Net income was €2.2 billion, up €2 billion from the same period last year as a result of the divestment of U.S. Foodservice and the company's Polish operations.
Cash flow before financing was €5.7 billion positive for the quarter, €5.1 billion better than the same period last year, mainly as a result of the proceeds from the sale of U.S. Foodservice and the company's Polish operations.
John Rishton, CFO and Acting President and CEO, said "The results show that we are continuing to make progress with our strategy for profitable growth. Of particular importance is that the roll-out of the Value Improvement Program at Stop & Shop and Giant-Landover remains on track, with customer perception of price reductions continuing to improve.
"I am pleased to announce that, as a consequence of the successful sale of U.S. Foodservice and our Polish operations, we have decided to return a further €1 billion to our shareholders by way of a share buyback program. This, together with the recently completed reverse stock split and €3 billion capital repayment, takes the total value to be returned to shareholders to €4 billion.
"With lower net debt we are revising our guidance on annual net interest expense for 2007 from a range of €400 to €450 million to between €320 and €340 million".
Ahold also announced that it has decided to delist from the New York Stock Exchange. The decision is consistent with the company's strategy of improving its cost effectiveness by reducing complexity without detracting from the integrity of its governance and control processes. Ahold's ADRs will continue to be traded on the over-the-counter (OTC) market in the United States.
