Amsterdam, Aug 1 - Dutch supermarket group Ahold reported better-than-expected sales in the second quarter after price cuts drew more customers to its stores, and it kept its 2008 operating margin target.
Ahold, which owns the Netherlands' biggest supermarket chain Albert Heijn but makes half its sales in the U.S., said on Friday revenues totalled 5.78 billion euros ($9.03 billion), compared with 5.83 billion euros a year ago.
Twelve analysts polled by Reuters had forecast on average sales of 5.64 billion euros for the supermarket group, the seventh biggest in the world by sales.
"The results are very strong. Ahold is in a restructuring mode. Apparently the programme they are rolling out is working," Fortis analyst Robert Jan Vos said. "I am convinced the shares will outperform today."
Ahold has said a two-year revamp of its U.S. stores launched in 2006, consisting of price cuts and more private-label products, should improve margins and sales later this year.
"The results underscore their volume strategy; if you boost volumes, profits will follow," said analyst Richard Withagen at SNS Securities.
Ahold shares ended at 7.32 euros on Thursday and are down 23 percent since the start of the year versus a 33 percent lower DJ Stoxx retail index on economic concerns, especially in the U.S.
U.S. food retailers have seen sales come under pressure as cash-strapped consumers trade down to cheaper products amid a slowing economy and rising food and fuel costs.
Ahold reiterated its 4.8-5.3 percent underlying retail operating margin target, in contrast with lowered outlooks from U.S. rivals Supervalu Inc, Safeway Inc and even Belgium's Delhaize, which has a strong U.S. presence.
The retailer said identical sales growth excluding fuels at its main U.S. chain Stop&Shop rose 1 percent versus an average forecast of a 0.2 percent drop from analysts.
Like-for-like sales growth at its other chain Giant-Landover was down 1.7 percent, in line with forecasts, and at Giant-Carlisle up by a higher-than-expected 4.1 percent.
Dutch chain Albert Heijn, from which Ahold earns half its operating income, outperformed after it posted an 11.5 percent rise in identical sales growth.
Ahold's chief operating officer for Europe and the head of Albert Heijn, Dick Boer, told Reuters last month that Dutch consumer spending was resilient for now, but he expected it to ease due to concerns from the credit crisis and slowing economic growth.