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AMSTERDAM - Ahold announced today that 2004 would be a "year of transition," noting that it expects to take goodwill losses and exchange rate charges on planned asset sales, Reuters reports.
"Retail operations will continue to face increased competition and price pressure. On the other hand, Ahold expects healthy sales development in the foodservice sector," the world's No. 3 retailer said in a statement.
Meanwhile the company's c.f.o., Hannu Ryopponen, said Ahold expects to sells its Spanish operations in a single deal.
"We are still planning to sell the Spanish operations in one go and at this stage of the process it looks like we will be doing so," he told a news conference. However, he added that the company would entertain the possibility of selling Spanish units separately if that would bring more money for shareholders.
Net sales growth at Ahold's U.S. retail operations this year is expected to be only modest as a result of continued competitive pressure, the company said. But it expects net sales in its Europe retail operations to grow.
The planned divestment of the Spanish operations in 2004 will reduce European net sales, Ahold said.
Foodservice market conditions, in particular in the U.S., are expected to be more favorable, although increasing fuel costs and food commodity prices may have a negative effect on industry pricing and competitiveness, Ahold said.
Ahold intends to complete the planned sale of the remaining assets in Latin America, its Spanish retail operations and the Bi-Lo/Bruno's chains in the United States, by end 2004.
These will lead to exceptional charges in the form of currency impact and goodwill write-offs.