Net sales increased by 65.1% to €15.9 billion (up 61.4% at constant exchange rates)
Net income increased by 72.8% to €356 million (up 68.2% at constant exchange rates)
Pro forma Q1 net sales increased by 2.9% to €15.8 billion (up 0.6% at constant exchange rates)
Pro forma underlying operating income increased by €45 million to €604 million, up 8.1%
Pro forma Q1 underlying operating margin increased to 3.8%, compared to 3.6% in Q1 2016
Strong free cash flow of €197 million, with increased capital expenditure compared to Q1 2016
Integration on track, with net synergies of €56 million delivered in the first quarter
Zaandam, the Netherlands, May 10, 2017 - Ahold Delhaize, a leader in supermarkets and eCommerce with market-leading local brands in 11 countries, published solid first quarter results for 2017 today, including an improved pro forma underlying operating margin for the Group.
Dick Boer, CEO of Ahold Delhaize, said: "We are pleased to report a resilient first quarter performance with an increase in margins for the Group despite the ongoing deflationary environment in the United States. We continue to make significant progress on the implementation of our Better Together strategy, investing in our customer proposition, while improving margins.
"Ten months after the merger of Ahold and Delhaize, we are fully on track with the integration and we are delivering on our synergy targets. We are driving forward our integration programs and continue to focus on sharing best practices across and within regions, as we aim to further strengthen our great local brands to ensure they remain customer-focused, close to their communities and positioned to win in their markets.
"In the United States, although sales were impacted by continuing price deflation, adverse weather and the timing of Easter, we were able to offset the impact on margins due to the delivery of strong synergy savings in the quarter. Although deflationary pressure was in line with previous quarters, it improved towards the end of the first quarter and we expect sales performance to improve in the second quarter and to operate in a slightly inflationary environment in the second half of the year.
"The Netherlands again reported strong performance. Albert Heijn continued to improve and renew its product range, both in supermarkets and online. Bol.com grew its share of Plaza sales, now offering more than 15 million products, and increased its customer base in Belgium.
"In Belgium, sales performance was stable compared to the previous quarter, and underlying operating margin was broadly in line with last year. Sales growth in Central and Southeastern Europe was driven by Romania and Serbia, with stable margins for the region, supported by margin improvements in the Czech Republic and Serbia.
"We are encouraged by the positive development of the combined free cash flow for the Group despite higher capital expenditure. This allows us to continue investing in key channels and businesses, while returning excess liquidity to our shareholders.
"For the full year, we reiterate our target of realizing €220 million net synergies, including €56 million realized year to date and expect that the full year 2017 underlying operating margin for the Group will increase compared to 2016."
Group performance on an IFRS basis
€ million, except per share data
Q1 2017 Q1 2016 (1 % change % change constant rates
Net sales 15,870 9,610 65.1 % 61.4 %
Operating income 569 336 69.3 % 65.6 %
Income from continuing operations 356 206 72.8 % 68.4 %
Net income 356 206 72.8 % 68.2 %
Basic earnings per share from continuing operations 0.28 0.25 12.0 % 8.9 %
Free cash flow (2
197 235 (16.2)% (16.5)%
(1. Represents the pre-merger results of Ahold. Results from former Delhaize segments are included as of July 24, 2016.
(2. Free cash flow is a non-GAAP measure. For a description of non-GAAP measures refer to section Use of non-GAAP
financial measures at the end of this report.
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