Ahold to offer more private brands

by Eric Schroeder
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AMSTERDAM, THE NETHERLANDS — Royal Ahold, the Dutch operator of U.S. supermarket chains Stop & Shop and Giant, is broadening its offerings to customers through improving its private brand product line and building its on-line business, company executives said Feb. 28 in conjunction with the release of fiscal 2012 earnings.

Underlying operating income in fiscal 2012 totaled $1,069 million at Ahold USA, up narrowly from $1,067 million in fiscal 2011. Sales for the full year increased 3% to $25.8 billion.

The company said it is “satisfied” with the integration and performance of the 15 former Genuardi’s stores that were acquired from Safeway in July 2012 for $113 million and now are part of the Giant Carlisle division. The stores acquired are located in the greater Philadelphia area.

Dick Boer, chief executive officer, said during a Feb. 28 conference call with analysts that Ahold opened the first eight Peapod pick-up points in the United States in 2012, and on Feb. 27 opened a ninth pick-up point in New York. As part of the service, customers may order their groceries on-line through Peapod.com for pick-up at participating stores.

Mr. Boer said Ahold also is continuing to broaden its offerings in the United States. He said the company has set an “ambitious goal” of 40% of sales penetration in 2016 of own brands.

“What’s good in the own brands is that in 2012 the divisions reformulated one in five of the own-brand products to meet higher quality standards,” Mr. Boer said.
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