BRUSSELS — Belgian supermarket operator Delhaize Group, which operates the Food Lion, Bottom Dollar Food, Harveys, Hannaford Supermarkets, Reid's and Sweetbay regional banners in the United States, said Thursday it will close 113 Food Lion stores and eliminate the Bloom banner as part of a reorganization. The Fool Lion stores slated for closure are primarily in markets in which the company has the least store density.
In addition, the chain will convert 42 of its Bloom locations to Food Lion and close the remaining seven Bloom stores. It will also convert 22 of its Bottom Dollar Food stores in North Carolina, Virginia and Maryland to Food Lion, and close the six remaining Bottom Dollar Food stores in those markets.
“We have decided to focus our Bottom Dollar Food brand on markets which provide the greatest opportunity for growth such as Philadelphia, where we have enjoyed considerable success, and Pittsburgh, where we will open our first stores in the first quarter of 2012,” the company said in a statement.
The store closures, slated to occur within 30 days, will result in approximately 5,000 job losses.
The company will also close a distribution center in the United States and 20 stores in Southeastern Europe.
Sub-par fourth-quarter sales in the United States and Belgium markets prompted the move. Revenue rose 7% to $7.16 billion in the quarter, which included a key acquisition. Same-store sales in the United States dipped 0.4% and fell 1.5% in Belgium. The United States is Delhaize's most important market with 1,650 stores, double the number of its Belgian home market.
“Today’s actions will continue to solidify our U.S. operations and enable our company to focus on our successful brand strategy repositioning at Food Lion and the expansion of Bottom Dollar Food in new markets,” said Ron Hodge, CEO, Delhaize America. “While these were difficult decisions given the impact on our associates, customers and communities, we believe these actions will enable us to better serve our customers in our markets with high density, while positioning the company for future growth.”
"While we grew our revenues for the full year, we are disappointed in the fourth quarter revenues in the U.S. and Belgium," Pierre-Olivier Beckers, Delhaize CEO, said in a statement.