Ahold Delhaize third-quarter sales, profit beat market forecast

  • The supermarket company said its free cash flow rose 112 million euros to 538 million euros, and increased its full-year guidance to 2 billion euros from 1.9 billion euros.

Ahold Delhaize, the Dutch-Belgian operator of grocery stores in Europe and the United States, on Wednesday posted third-quarter results that beat analysts' forecasts, lifted by strong online sales and growth in its key markets.

Group sales increased 3.6 percent to 15.8 billion euros ($18.09 billion) in the three-month period, Ahold said, with sales rising 3.2 percent in key markets of the United States and 5.8 percent in the Netherlands.

Analysts polled by the company had forecast 2.5 percent higher group sales of 15.5 billion euros on average.

Underlying quarterly operating income also beat expectations, rising to 647 million euros, compared with an average forecast of 620 million euros.

The supermarket company said its free cash flow rose 112 million euros to 538 million euros, and increased its full-year guidance to 2 billion euros from 1.9 billion euros.

The owner of Stop & Shop and Giant chains on the U.S. East coast confirmed its target of net synergies of 420 million euros in 2018 and 750 million euros of gross synergies in 2019.

Frans Muller, CEO of Ahold Delhaize told CNBC, that all retail brands are growing and that it was "a very good quarter."

When asked about the outlook in the United States, where the brand has a strong presence, Muller played down the impact of the midterm vote.

"In food retail it is very important for us that we see a strong economy, and a strong economy is also driven by low unemployment rates and people have more dollars in their pockets - talking about the U.S. market as you know is 60 percent of our total business so a strong economy is important to us, and I think there are more things which can support our customers in their spending than only tax cuts," he said.

Exit polls suggest that Democrats will get the majority in the House, meaning that President Trump might face new challenges in implementing certain policies, such as tax cuts.