* Q4 net sales 7 bln euros, matching Reuters poll forecast
* Markets challenging and promotional, especially U.S.
* Q4 underlying U.S. sales up 0.9 percent; forecast up 1.1 percent
* Q4 underlying Dutch sales up 4 percent; foreast up 3.3 percent
* Shares seen little changed
(Adds analyst, trader comments)
By Mark Potter
LONDON, Jan 20 (Reuters) - Strong growth in the Netherlands and central Europe helped Dutch grocer Ahold overcome tough trading conditions in its main U.S. market and post a fourth-quarter sales rise in line with expectations.
Ahold, which runs Dutch market leader Albert Heijn but makes about 60 percent of its sales in the United States, said on Thursday shoppers remained under pressure and focused on promotions in all of its markets, especially the United States.
Retailers across Europe and the United States are worried about their ability to pass on higher costs of goods like groceries and fuel at a time when consumers are being hit by austerity measures aimed at cutting government debts.
Ahold, with around 2,900 stores in 11 countries, said it made net sales of 7 billion euros ($9.4 billion) in the last three months of 2010, in line with the mean forecast in a Reuters poll of 14 analysts.
The 5.5 percent increase on the same quarter last year was adjusted for currency movements and the impact of an extra week in the comparable period a year ago.
"A promising exit rate to the year and reflecting Ahold's strong market positions, competitor weakness and a sequential pick-up in food inflation," said Bernstein analyst Chris Hogbin.
However, one Amsterdam-based trader predicted "no fireworks" from Ahold's share price following its cautious assessment of market conditions.
The shares have lagged the STOXX Europe 600 retail index by 4 percent over the last year, held back by Ahold's lack of exposure to fast-growing emerging markets.
They closed at 9.739 euros on Wednesday, valuing the business at about 11.6 billion euros.
BETTER, BUT STILL TOUGH
Ahold has fared better than rivals in a cut-throat U.S. market, helped by a refocusing on lower prices before the recession, strength in more affluent north eastern states and financial woes at competitors A&P and Supervalu.
Belgium's Delhaize, which also makes most of its sales in the United States, but has been hit by deeper economic downturn in its main south eastern states, is due to publish fourth-quarter figures on Friday.
In the United States, where Ahold runs the Stop & Shop, Giant-Landover and Giant-Carlisle chains, same-store sales rose 0.9 percent excluding fuel, improving on a 0.6 percent rise in the third quarter, but just below analysts' average forecast increase of 1.1 percent.
Dutch same-store sales were up 4 percent, beating expectations for a rise of 3.3 percent, while sales in the Czech Republic and Slovakia climbed 4.5 percent on the same basis, also topping forecasts.
Analysts are waiting for news on how Ahold will spend its 2 billion euros-plus cash pile, amid speculation it could buy stores from struggling rivals, buy Dutch retailer Hema or extend its existing share buyback programme.
"Although the Q4 update is encouraging, the primary reason to own the stock, in our view, is the potential for Ahold to use the strength of its balance sheet to accelerate earnings growth either through acquisitions and/or buybacks," Hogbin said. (Additional reporting by Aaron Gray-Block in Amsterdam; Editing by Mike Nesbit) ($1=.7425 euros)