Digital sales on fire at Ahold Delhaize USA

Mike Troy
Editorial Director
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Ahold Delhaize USA said it solidified its position as the leading omnichannel operator on the East Coast during the fourth quarter and in 2020 plans to further strengthen its position.

The company said strong sales at its Food Lion and Hannaford banners, as well as a 42.7% jump in online sales, helped it accelerate growth in the fourth quarter. Same-store sales grew 2.3% in its U.S. division.

Operating income overall at the retail conglomerate rose to $834 million for the period ended Dec. 31, while sales rose 5.5% to $18.9 billion, helped by a strong dollar. The company said that it expects to reach $7.7 billion in group online sales by 2021.

"Our online sales growth in the U.S. accelerated to 42.7% at constant exchange rates in the fourth quarter, and we met our 2019 guidance outlook of over 20% growth, building upon our position as the leading omnichannel operator on the East Coast," according to CEO Frans Muller said. "Performance at Food Lion and Hannaford was particularly strong. While Stop & Shop's comparable sales, excluding gasoline, improved over the last quarter, they remained slightly negative due to a challenging sales environment. That said, our ‘Re-imagine Stop & Shop’ program continues to build momentum with sales in Long Island [New York], and now Hartford, performing in line with our expectations. In 2020, we expect to remodel another 65 Stop & Shop stores across the brand’s footprint."

The day prior to releasing quarterly results Ahold Delhaize USA announced a retrenchment of its digital operations. The company said it would close the Midwest division of its Peapod online business, which generated sales of $97 million in revenue of the $1.1 billion in total online revenue in the United States. The moves is designed to help the company focus on growing its brands on the East Coast and to execute its strategy of enabling each of its local brands to be the top omnichannel grocery retailers in their respective markets, using the capabilities of Peapod Digital Labs.