Delhaize profit disappoints, hit by week dollar and high costs

The Belgian supermarket group's earnings before interest and tax (EBIT) fell to 205.7 million euros from 229.6 million euros a year earlier, it said. The average forecast was 218 million euros.

 Delhaize, which generates about 70
percent of its sales in the United States, repeated its 2008 forecast
that includes EBIT growth of 6-8 percent.

Delhaize said earnings would be
significantly weighted towards the second half given renewals of its
flagship U.S. Food Lion stores, the roll-out of its U.S. private
labels, cost and efficiency projects and easier comparables.

In the United States, first-quarter
operating profit in dollar terms rose 0.2 percent, but fell 12.3
percent to a converted 160.9 million euros. Like-for-like sales
growth was 3.5 percent, against expectations of 3.2 percent.

Profit at the group's Belgian
operations dropped by 8.3 percent to 40.0 million euros. Delhaize
faces fierce competition in Belgium from France's Carrefour, Colruyt
and hard discounters Aldi and Lidl.

In the U.S., its stores such as Food
Lion, Sweetbay and Hannaford compete against a range of retailers
including Wal-Mart.