Ahold Misses Estimates in Competitive Q2

Ahold Misses Estimates in Competitive Q2

ZAANDAN, NETHERLANDS - Ahold has seen increased market pressure during the second quarter of 2014.  The company is reporting net sales of €7.4 billion, down 1.1%.  However, the retailer did see strong online Q2 sales of €29 million, an 18.6% increase.

“In a challenging competitive environment, we remain focused on executing our Reshaping Retail strategy and continue to make investments in our customer and value offering, making our stores a better place to shop,” said Ahold CEO Dick Boer.

In the United States, Q2 net sales were €4.4 million, which represents a 1.7% decline under last year for the same period, according to the company's Q2 financial report. Ahold says that Easter falling into the second quarter had a negative impact on sales

Check out Ahold CEO Dick Boer discussing the company's Q2 results by clicking below.

Ahold Q2 2014 Results Video - External Link

Ahold’s U.S. online grocery operation, Peapod, saw double-digit sales growth in the second quarter.  With the opening of a new warehouse in New Jersey, Peapod’s capacity will almost double and will consolidate its position as the leading online grocer in the U.S., according to a press release.

“In the United States, the roll-out of our program to improve our customer proposition is progressing well, bringing better quality, service and value to our customers.  By the end of this quarter, the program was active in 320 stores and will be rolled out to more than half of our stores by the end of this year.  The accelerated roll out of the program together with our decision to absorb commodity price increases resulted in an investment in margin that was partly offset by cost savings from our Simplicity program,” Boer said.

Looking ahead, Ahold expects ongoing investments in its customer proposition and further development of its product range across multiple categories to result in improving sales trends.  The retailer remains focused on executing its Reshaping Retail strategy and investing in its Simplicity program.

What can we expect from Ahold’s continued investments online, and how will the retailer’s new program improve sales in the next quarter?

Stay tuned to AndNowUKnow as we keep an eye on Ahold’s performance as the fiscal year continues.