May 6 (Reuters) – Supermarket group Ahold Delhaize’s first-quarter core profit beat market expectations on Wednesday, as its U.S. business remained strong amid falling consumer confidence, offsetting a hit from the weak dollar.
The Dutch group, which operates the Stop & Shop, Giant, Food Lion and Hannaford chains in the U.S. and the Albert Heijn and Delhaize chains in the Netherlands and Belgium, said its underlying operating income rose 0.7% to 896 million euros ($1.05 billion), beating analysts’ consensus of 858 million euros.
At constant currency exchange rates, the core earnings rose 8.1% compared to last year.
The group, which generates more than half of its revenue in the United States, joins several other European firms that have been hit by currency exchange rates, as translating the U.S. dollar to euros reduces reported results.
U.S. consumer sentiment also dropped to an all-time low in April, as inflation caused by the U.S.-Israeli war with Iran continued to weigh on households.
“Disruptions from geopolitical volatility and tensions, including the recent armed conflict in the Middle East, are a reality our business has managed through before,” CEO Frans Muller said in a statement.
“We draw on previous experience and on the measures we have put in place over the past few years to limit the short-term impacts,” he added.
The war has disrupted shipping in the Strait of Hormuz, driving up oil prices and ultimately the cost of gasoline and diesel. Prices for other commodities, including fertilizers, petrochemicals and aluminium, have also surged and are expected to impact consumers soon.
Ahold Delhaize’s first-quarter sales rose 2% at constant exchange rates, but fell 4.3% on a reported basis.
The group also said it had chosen Kingfisher CEO Thierry Garnier to succeed Muller as the top boss from April 2027.
($1 = 0.8524 euros)
(Reporting by Dimitri Rhodes and Jerome Terroy in Gdansk, editing by Milla Nissi-Prussak)
