Ahold Delhaize, which operates banners Food Lion, Stop & Shop, Giant, Hannaford and Giant Food Stores, discussed the effect of the Stop & Shop strike in its quarterly earnings report.
“As a result of the strikes that affected 246 of Stop & Shop’s 415 stores and lasted 11 days, having started on April 11, 2019, Stop & Shop estimates a one-off impact on underlying operating profit of between $90-$110 million, resulting from lower sales, increased shrink of seasonal and perishable inventory and additional supply chain costs,” the company wrote.
That effect doesn’t show up in the first-quarter report, however. Ahold Delhaize president and CEO Frans Muller categorized the period as a solid one for its U.S. banners.
Net sales for the quarter were $10.98 billion, including $251 million from online sales, according to the report. Online sales are up 13% from the same period in 2018.
“In the U.S., we had a good quarter, as we continue to invest in our customer experience and expand and improve our online offering,” Muller said in a news release. “This resulted in comparable sales growth of 1.2%, excluding gasoline, or 2.2% adjusted for the timing of Easter. Our underlying operating margin came in at 4.9%, benefiting from synergies and our Save for Our Customers program with savings ahead of investments in our customer proposition.”
The earnings report laid out several highlights for the company’s U.S. businesses.
Ahold Delhaize is approaching the next phase of its Re-imagining Stop & Shop initiative, taking learnings from its 21 remodeled Hartford, Conn., stores and applying those to 22 Long Island, N.Y., stores that will be reopening from June to August.
In addition, Food Lion is investing $158 million to remodel 92 stores in South Carolina and $40 million to remodel 23 stores in Virginia. Among the changes will be “simpler in-store navigation, expanded variety and assortment and an enhanced customer service experience,” per the report.
Digital initiatives were also featured, with Giant Food Stores debuting online brand Giant Direct and opening an e-commerce hub with Peapod, Hannaford seeing nearly 1.2 million customers signing up for the new My Hannaford Rewards loyalty program, and Giant Food launching its Nutrition Made Easy podcast.