Ahold has knocked €22 billion in mis-stated sales off its balance sheet in attempts to further distance itself from the fraud in its US unit, and reported first-quarter results that were more robust than analysts anticipated.
The Dutch food retailer, which has been hammered by the revelation of an $880 million (€762 million) fraud in its US Foodservice division, made the restatement after previously acknowledging that it wrongly accounted for five of its joint ventures in Europe and South America.
Ahold made the expected restatement in its first trading statement since the accounting scandal was revealed in February.Excluding joint ventures, Ahold's sales fell 11 per cent to €17.4 billion from €19.6 billion in the year-ago period.
Shares rallied on the news, closing up 12 per cent at €6.91, as the sales decline appeared to be not as deep as some had forecast.
But one analyst warned that investors' relief was premature.
Ms Mia Kirchgaessner, an analyst at Sanford Bernstein, said her research indicated Ahold's US retail outlets were pushing "ridiculous promotions" that she expected would have a big impact on margins.
The company has yet to fully restate 2002 earnings, but Ms Kirchgaessner said she expected the company to report a wider loss than she had forecast for the year, based on Ahold restating more sales than she had estimated.
Ahold reduced reported 2001 sales from €66.7 billion to €54 billion and 2002 sales from €72.7 billion to €62.9 billion. - (Financial Times Service)
