Food Lion Revamps Spark Q2 Comp Gain

JON SPRINGER

BRUSSELS, Belgium — The 200 Food Lion stores that Delhaize revamped behind new price and service initiatives outperformed the rest of the chain and helped Delhaize post a quarterly increase in U.S. comparable-store sales for the first time in two years.

Integration of category management functions at Delhaize’s U.S. banners was more costly in the quarter than the company anticipated, leading to a 2.7% decrease in U.S. profits for the quarter.

Delhaize in the quarter earned $205 million on sales of $4.8 billion in the U.S. Sales increased 4.8% overall.

The company in May introduced new positioning for Food Lion stores in the Chattanooga, Tenn., and Raleigh, N.C., markets, emphasizing service, lower everyday prices and improved store conditions.

“Customer feedback tells us that Food Lion is on the right track and the changes we have made are being noticed and appreciated,” Pierre-Olivier Beckers, president and chief executive officer, said in a conference call. “Comparable-store sales growth of the 200 stores outperformed the rest of the network through significant increase in transaction count and basket size, and this despite the additional price investments we have made in these stores. Clearly, we’re pulling the right levers and going in the right direction.”