In May, Ahold Delhaize USA announced that underperforming Stop & Shop stores would be closed to create a healthy store base for the long term.
It’s safe to say the recovery process has just begun, as Ahold Delhaize released soft second-quarter earnings on Wednesday.
In the U.S., net sales came in at €13.6 billion ($14.8 billion), a decrease of 1.5% year over year, and comparable sales excluding gasoline dropped 0.4%. According to Ahold Delhaize, strong growth in pharmacy was offset by moderating inflation rates, the divestment of FreshDirect, and lower gas sales.
Food Lion and Hannaford continue to lead U.S. brand performance, with 47 and 12 consecutive quarters of positive sales growth, respectively.
Online sales were also in the red from a year-over-year perspective, declining 2.9%. Food Lion, Hannaford, and The GIANT Company, however, had double-digit ecommerce growth for the quarter.
“Excluding the impacts of calendar shifts and the divestment of FreshDirect, we saw a sequential improvement in growth rates during the quarter, as volume trends continued on a positive trajectory,” said Frans Muller, president and CEO of Ahold Delhaize. “By putting increased attention on the value of own-brand products while making it easier to earn loyalty rewards, the U.S. brands are laser-focused on investing in our winning customer value proposition.”
A total of 32 Stop & Shops will be closed by the end of the year, which will take a bit out of net sales in 2024 (between $100 and $125 million) and 2025 (between $550 and $575 million).
On Monday, Ahold Delhaize USA announced four of its brands — Giant Food, The GIANT Company, Hannaford, and Stop & Shop, have selected Havas Media Network North America as their media agency of record as they continue to drive efficiency through scaled media.
Leveraging real-time data will be the focus of Havas Media Network, which will support strategy, planning, and activation across all traditional and digital channels for the in-scope brands.
As part of the digital execution, Havas Media Network will also implement dynamic creative optimization, which will enable the four Ahold Delhaize USA brands to create personalized ads based on real-time data.