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9th June 2023

To maintain profits, Ahold Delhaize accelerates cost-cutting.

Ahold Delhaize, the Dutch retail firm, will intensify its cost-cutting effort in order to maintain an operating margin of more than 4% in 2023. The store reported good fourth-quarter and full-year profits for fiscal year 2022.

Ahold Delhaize reported a 7.9% increase in comparable sales to 23.4 billion euros in the fourth quarter. Overall revenues increased 6.9% year on year to 87 billion euros.

The fourth-quarter operating margin increased by 0.2 percentage point to 4.4%, while the full-year operating margin decreased by 0.1 percentage point to 4.3%. This is substantially larger than the margins of competitors in the business, such as Carrefour and Colruyt, although the others do not operate in the United States. Due to cost inflation, particularly rising energy costs, Ahold Delhaize’s margin in Europe was 3.7%.

Ahold Delhaize intends to maintain a margin of at least 4% in 2023. To that end, the store is stepping up its cost-cutting efforts: under the banner of “Accelerate,” the corporation will further simplify the organization, enhance collaborative buying, and consolidate IT.

source: retaildetail