Albert/Hypernova to report a loss in Czech Republic and Slovakia in 2009
Ahold's division Albert/Hypernova, which runs supermarkets and hypermarkets in the Czech Republic and Slovakia, is likely to report a loss in 2009 again, Ahold's CEO John Rishton said. This is mainly due to the fierce competition in the region and declining consumer interest for hyper- and supermarkets. He said the performance of Albert/Hypernova in 2008 was "very volatile", even though it was able to maintain its market position and break even. The division reported a slight operating profit of EUR1 million (USD1.46 million) for 2008. Rishton said Ahold will provide Albert/Hypernova with a "firm financial foundation" in 2009 and also announced headcount reductions. These businesses account for 6.9% of Ahold's total net sales.
For its other operations in the USA and the Netherlands, however, he said he had seen no evidence of consumers "trading down" to cheaper products at the start of this year. "People have to eat and the question is when people are cutting back in all these other areas, are they also going to cut back on some of the small luxuries that they enjoy with their families? Evidence to date suggests the answer is no," he told the Financial Times. Despite the upbeat picture of trading conditions, the group shied away from making any predictions for 2009. Regarding its Dutch home market, Ahold's European CEO, Dick Boer, ruled out new price battles, adding that Albert Heijn was still lowering prices but would not be communicating them, as price differences would have become marginal. "Prices in the Netherlands have never been so low."
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