Brussels-based supermarket group Delhaize, which owns the U.S. grocery chain Food Lion, announced Thursday it will lay off 5,000 employees in the United States and Europe. It also will close several locations by March.
The moves aim to make Delhaize more competitive, especially after disappointing earnings in the last quarter.
After a thorough review of our store portfolio, we have decided to close or convert a number of stores in the U.S. and in Southeastern Europe during the first quarter of 2012, Pierre-Olivier Beckers, CEO of Delhaize Group said in a statement. This decision is in line with our New Game Plan which is aimed at accelerating profitable growth.
The Belgian company posted seven percent growth in revenue in the fourth quarter of 2011. For the year, revenue grew 4.6 percent.
The layoffs will mean 146 grocery stores, mostly Food Lion stores, will be closed between the U.S. and Europe. In addition, Delaize will convert 64 facilities, currently operating under various brands, into Food Lion stores. Delhaize expect to spend about $1 billion this year to open at least 200 new stores, remodel 200 more and accelerate the opening of as many as 700 Food Lion groceries.
In Brussels, the company's stock rose slightly to $46.85 after Thursday's trading.