U.S. Foodservice Sale Attracts Interest; Sales, Operating Income, Margin Improve

"There is considerable interest in U.S. Foodservice," Chief Executive Anders Moberg told reporters in the course of a press conference, but declined to elaborate on any specific bids or timetable.

He declined to provide any details about the impending sale, which financial analysts say will bring some $6 billion into Ahold's coffers.

U.S. Foodservice met Ahold's target growth rates designated last year, delivering 1.7% operating margin. Net sales increase at the distributorship was 4.8%, the corporation revealed in the annual report released at the press conference.

Ahold annual report indicated that in the fourth quarter of 2006, the second largest American distributorship, according to the 2007 ID Top 50, based in Columbia, MD, registered sales increase of 5.1% to $4.4 billion. Operating income was $81 million compared with a loss of $9 million in the same period last year, resulting in a quarterly operating margin of 1.8%.

According to Ahold, the improvement was primarily attributable to a higher gross margin, continued operating efficiencies and cost reductions, as well as the non-repetition of $52 million of restructuring and related charges last year.

For the full year, net sales increased 4.1% to $19.2 billion. Net sales growth was negatively impacted by about 0.8% as a result of the Sofco disposition in 2005. Cost inflation had a negligible effect on the full year. Operating income was $325 million resulting in an annual operating margin of 1.7% compared with 0.6% in the prior year, said Ahold.


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