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AMSTERDAM - Dutch retail group Ahold announced today that its core profits fell in the first quarter due in part to charges from divestments.
Earnings before interest, tax and amortisation (EBITA) fell 22.9 percent to 351 million euros, against an average forecast in a Reuters poll of 323.5 million. Forecasts ranged from 250 million to 405 million euros.
Ahold has begun a three-year plan to boost business and cut debts after a billion-euro profit overstatement scandal last year.
"The results were heavily impacted by the exceptional losses that we previously communicated relating to ... divestments," c.e.o. Anders Moberg said in a statement.
"Apart from these exceptional losses that have no impact on equity or cash, the main operating companies performed in line with our expectations," he said.
At U.S. retail, where first-quarter sales were down 14.6 percent, operating earnings fell to 320 million euros from 423 million. The division took one-off costs of $25 million for the closer integration of Stop & Shop and Giant-Carlisle.
In Europe, where its flagship Dutch store chain Albert Heijn is cutting prices for competitive reasons, operating profit fell 19.4 percent to 58 million euros. Ahold said the decrease was primarily due to higher pension costs and a weak performance in Spain, where it aims to sell its operations before the end of this year.
Ahold made no change to its forecasts, repeating that 2004 results would be significantly affected by the write-offs.