AMSTERDAM — Ahold here said Wednesday that its margins were pressured in the first quarter this year due to the timing of the Easter holiday relative to a year ago and ongoing investments in price and promotion to drive sales.
Patrick Roquas, an analyst with Amsterdam-based Rabobank, said the margin performance in the U.S. was “somewhat weaker than expected,” although “so far, the start of Q2 has seen an improving trend.”
Net income for the first quarter was down 3.1% overall to about $352 million. In the U.S., underlying operating income of $320 million was down 3.9% from a year ago at constant exchange rates, and underlying operating margin totaled 4.1% of sales, vs. 4.6 of sales in the first quarter of 2011. EBITDA in the U.S. was down 1.7%
“We continued to invest in competitiveness both in the United States and in Europe with higher levels of promotional activity,” said Dick Boer, chief executive officer. “We expect 2012 to be another challenging year for the food retail industry, with intense competitive activity and consumer spending under pressure.”
As previously reported, sales in the U.S. were $7.8 billion, up 2.8%. Identical-store sales were up 0.1%, excluding gas.
The company said sales in the year-ago quarter reflected solid Easter sales growth, while the traditionally slower week following Easter occurred in the second quarter of 2011, vs. the first quarter of 2012.