Dutch-Belgian retail giant Ahold Delhaize, with supermarkets throughout Luxembourg, said Thursday that net profits soared in the third quarter as it unveiled its first combined earnings since its mega-merger.
Growth in The Netherlands helped drive the “solid” performance, said the group, whose tie-up in July created one of the world’s largest retail companies.
Net profit leaped 25 percent to 236 million euros compared to the third quarter in 2015, while sales surged more than 64 percent to 13.9 billion euros, it said.
The Dutch retail giant Ahold and Belgian rival Delhaize finalised their merger in July after US regulatory authorities blessed their union with a green light.
Between them the firms have 6,500 stores in Europe, including Delhaize in Luxembourg, and the United States and employ 375,000 people.
“Despite challenging conditions in certain markets, Ahold Delhaize has delivered growth in sales and in underlying operating income on a pro forma basis which reflects the strength and resilience of our great local brands,” chief executive Dick Boer said in the statement.
Based in Zaandam just outside Amsterdam, Ahold announced in June 2015 it was merging with Delhaize.
The companies achieved total sales last year of 62 billion euros — 38.2 billion for Ahold and 24.4 billion for Delhaize.
Analysts say the merger created the fifth-largest grocery chain in the fiercely-contested US market and the fourth-largest in Europe.
Boer acknowledged that “the trading environment in the US remained challenging with ongoing price deflation and competitive pressures in the market”.
In pro-forma data, which allows a better comparison of the post-merger results by presenting them as if the union happened at the beginning of the 2015 financial year, sales stood at 14.55 billion euros which would have been a 2.6-percent increase.
In The Netherlands where Ahold dominates the retail sector thanks to its network of Albert Heijn supermarkets, sales were up 4.3 percent to 2.9 billion euros.