BRUSSELS - October 27, 2000 - In the third quarter of 2000, sales (excluding taxes) of the Delhaize Group amounted to EUR 4.5 billion, an increase of 28.8 % compared to the third quarter of 1999. Quarterly financial data include the operating results of Hannaford for six weeks of the third quarter.
Operating cash flow increased by 26.8 % to EUR 291.8 million. The net current profit before goodwill amortisation and exceptional result (Group share) of the Delhaize Group was up by 0.3 % to EUR 35.5 million (EUR 0.68 per share). The net profit after goodwill amortisation and exceptional result (Group share) decreased from EUR 34.4 million to EUR 2.6 million (EUR 0.05 per share) due to one-time charges of Delhaize America related to the merger with Hannaford, store closings and asset impairment.
During the third quarter of 2000, the Delhaize Group extended its sales network with 138 stores to a total of 2,315 outlets.
During the first nine months of 2000, sales of the Delhaize Group increased by 20.2 % to EUR 11.9 billion, the operating cash flow by 22.8 % to EUR 802.5 million and the net profit before goodwill amortisation and exceptional result by 13.6 % to EUR 125.6 million.
'We are satisfied with the same-store-sales of 1 % in the third quarter and the increase of the market share of Delhaize America, in spite of the highly competitive environment in the Southeast of the U.S.A. This resulted in an operating cash flow-margin of 6.8 %', says Pierre-Olivier Beckers, President and Chief Executive Officer of the Delhaize Group. 'And on this side of the Atlantic, the Belgian activities continue to perform strongly, resulting in a significant increase of the operating cash flow-margin to 4.6 % and a rise in sales by 7 %.'
In 2000, the Delhaize Group expects an increase of its sales network by 253 stores (+ 12 %) to 2,365 stores. This total does not include the 45 supermarkets and 12 cash & carry-stores of Trofo, the acquisition recently announced by Alfa-Beta. The operating company of the Group in Greece will become, thanks to the acquisition of Trofo, the second food retailer in the country (combined sales in 1999 exceeding GRD 245 billion or EUR 720 million). This transaction is expected to be closed early 2001.
In Belgium Tom & Co has early October 2000 reinforced its leading position in the rapidly growing market of food products and accessories for pets by acquiring Amizoo that operates 13 stores. In 1999, Amizoo achieved sales of BEF 300 million (EUR 7.5 million).
Delhaize America is making steady progress towards the integration of its new Hannaford unit since its acquisition at the end of July 2000. The company continues to expect first-year synergies of USD 40 million and USD 75 million of synergies on an annual basis in its third year of combined operating results.
On September 6, 2000 the Delhaize Group proposed to the Board of Directors of Delhaize America to exchange Delhaize Group stock for all of the outstanding shares of Class A and Class B stock of Delhaize America not held by the Delhaize Group. A Special Committee, composed of the four independent directors of Delhaize America, engaged financial and legal advisors to evaluate the exchange offer and should complete its evaluation of the exchange offer within the following weeks.
The Delhaize Group is a food retailer headquartered in Belgium and listed on the Brussels Stock Exchange (Euronext). The Delhaize Group operates in 11 countries and achieved in 1999 sales of EUR 14.3 billion and its net earnings amounted to EUR 169.9 million.
Operating companies
In the third quarter of 2000, sales (excluding taxes) of Delhaize America (U.S.A.) stood at USD 3.1 billion (EUR 3.4 billion), a 18.1 % increase. Same-store-sales were up by 1 %. Operating cash flow increased by 1.4 % to USD 208.7 million (EUR 230.5 million). After one-time costs related to the merger with Hannaford, store closings and asset impairment, the net result amounted to
USD -10.6 million (EUR -11.7 million). At the end of September 2000, Delhaize America was operating 1,418 supermarkets, 142 more than at the end of 1999.
Over the third quarter of 2000, Super Discount Markets (U.S.A.) achieved sales (excluding taxes) of USD 73 million (EUR 80.6 million), a decrease by 0.9 %. Operating cash flow stood at USD 1.1 million (EUR 1.2 million). As of the end of the third quarter, Super Discount Markets was operating 21 Cub Foods supermarkets and 4 Save-A-Lot discount stores.
In the third quarter of 2000, Delhaize Belgium achieved sales (including taxes) of BEF 31.9 billion (EUR 791.8 million), an increase by 7 %. Operating cash flow was up by 78.1 % to BEF 1.5 billion (EUR 36.3 million), resulting in an increase of the operating cash flow-margin from 2.7 % (third quarter of 1999) to 4.6 % in the third quarter of 2000 (4.9 % on sales excluding taxes). The sales network was extended with 1 Delhaize 'Le Lion' Supermarket, 6 AD Delhaize or Superette, 1 Tom & Co and 2 Shop 'n Go.
During the third quarter of 2000, sales (including taxes) of Alfa-Beta (Greece) were up by 20.8 % to GRD 40.5 billion (EUR 119.8 million). Operating cash flow increased by 9.4 % to GRD 2.2 billion (EUR 6.5 million). Profit before taxes rose from GRD 141.5 million (EUR 0.4 million) to GRD 147 million (EUR 0.4 million), an increase by 3.9 %. Alfa-Beta added 1 new supermarket to a total of 53 stores.
Sales (including taxes) of Delvita (Czech Republic and Slovakia) totalled CZK 3.3 billion (EUR 93.2 million), a rise of 1.7 %. Operating cash flow amounted to CZK 145.1 million (EUR 4.1 million), a decrease by 9.2 %, due to the competitive environment as a result of the significant number of store openings. At the end of September 2000, Delvita was operating 114 stores, of which 99 in the Czech Republic and 15 in Slovakia.
In the third quarter of 2000, sales (excluding taxes) of Mega-Image (Romania) amounted to ROL 141.5 billion (EUR 6.9 million) and operating cash flow to ROL 833 million (EUR 0.04 million). At the end of the third quarter, Mega-Image operated 9 stores, one more than at the end of June 2000.
During the third quarter of 2000, P.G. (France) achieved sales (including taxes) of FRF 608 million (EUR 92.7 million), a rise of 7.4 % and the operating cash flow increased by 47.3 % to FRF 27.7 million (EUR 4.2 million). P.G. operated 49 stores at the end of September 2000.
Sales (excluding taxes) of the operating companies of the Delhaize Group in Asia rose during the third quarter of 2000 by 39.6 % to EUR 57 million. Operating cash flow amounted to EUR 0.7 million, compared to EUR 0.9 million for the third quarter of 1999. The number of stores amounted to a total of 61 supermarkets.
Investors and financial press contact:
| Guy Elewaut |
+32 (0) 2 412 29 48 +32 (0) 477 50 07 96 |
Geoffroy d'Oultremont |
+32 (0) 2 412 83 21 +32 (0) 478 88 32 96 |
Fax: + 32 (0) 2 412 29 76
e-mail:
investor@delhaizegroup.com
Third Quarter 2000 Figures