Koninklijke Ahold Delhaize N.v. · EURONEXT:AD
Koninklijke Ahold Delhaize — Q2 2017 Earnings Presentation
29 slides from Koninklijke Ahold Delhaize's earnings presentation, Aug 9, 2017
Slide 1: Second Quarter 2017 Results
1 Second Quarter 2017 Results August 9, 2017
Slide 2: Q2 Highlights
Q2 Highlights Dick Boer President and CEO
Slide 3: Highlights – second quarter 2017
Second Quarter 2017 Results 3 Highlights – second quarter 2017 • Improved pro forma sales performance, up 3.4% (+1.8% at constant exchange rates) to €16.0 billion, US slightly inflationary in the quarter • Pro forma underlying operating income increased by €64 million to €626 million, up 10.2% at co
Slide 4: Financial Results
Financial Results Jeff Carr CFO
Slide 5: Group performance - pro forma
Second Quarter 2017 Results 5 Group performance - pro forma € in million Quarter 2 2017 2016 Change Change actual rates constant rates Net sales 16,044 15,509 3.4% 1.8% Net sales excl gas 15,802 15,273 3.5% 1.9% Underlying EBITDA 1,079 995 8.4% 7.0% Underlying EBITDA margin 6.7% 6.4% Underlying oper
Slide 6: Ahold USA – pro forma results Q2 2017
Second Quarter 2017 Results 6 Ahold USA – pro forma results Q2 2017 Net sales Comparable sales growth 1 € in million • Net sales flat at constant 145 21 3 rates -24 • Comparable sales ex gas 5.934 5.934 up 0.3% 2,0% 5.789 • Retail inflation of 0.8% 1,3% -0,1% -0,5% -1,8% 0.3% • Calendar impact more
Slide 7: Delhaize America – pro forma results Q2 2017
Second Quarter 2017 Results 7 Delhaize America – pro forma results Q2 2017 Net sales Comparable sales growth € in million • Net sales +1.2% at constant 95 54 rates -3 • Comparable sales up 1.3% 3,0% 3.843 3.938 3.989 • Retail inflation of 0.1%, 2,0% 2,2% Hannaford in line with 1,3% 1.3% AUSA, Food L
Slide 8: The Netherlands – pro forma results Q2 2017
Second Quarter 2017 Results 8 The Netherlands – pro forma results Q2 2017 Net sales Comparable sales growth € in million 159 22 • Net sales +5.6% 6,0% • Comparable sales up 4.9% 4,4% 4.9% 3,424 (+3.8% ex bol.com) 3,3% 3,0% 2,8% 3,243 • Retail inflation of 1.9% • Continued strong growth both in onlin
Slide 9: Belgium – pro forma results Q2 2017
Second Quarter 2017 Results 9 Belgium – pro forma results Q2 2017 Net sales Comparable sales growth € in million • Net sales +0.2% 0 3 • Comparable sales flat 3,9% • Retail inflation of 0.8% 2,6% 1,255 1,258 • Strong performance at 1,3% affiliate stores offset by -0,9% -0,6% 0,0% Q2'16 Comp sales Ne
Slide 10: CSE – pro forma results Q2 2017
Second Quarter 2017 Results 10 CSE – pro forma results Q2 2017 Net sales Comparable sales growth 1 € in million • Net sales +3.9 % at constant 22 34 7,4% 4 rates 6,5% 5,7% • Comparable sales ex gas 1,383 1,439 up 1.7%, driven by Romania, 3,5% 1,379 1.7% Serbia and Czech Republic 1,5% • Sales in Gree
Slide 11: Free cash flow generation
Second Quarter 2017 Results 11 Free cash flow generation * € in million 2017 2016 Q2 H1 Q2 H1 Operating cash flow 1,054 2,055 977 1,931 Change in working capital 7 (339) 194 (397) Income tax paid (189) (217) (190) (224) Cash from operating activities 872 1,499 972 1,303 Investments (385) (816) (407)
Slide 12: Integration Update
Integration Update Frans Muller Deputy CEO Chief Integration Officer
Slide 13: Outline
Second Quarter 2017 Results 13 Outline 1. Organization 2. Synergies and one-time costs 3. Transformation
Slide 14: Integration roadmap
Second Quarter 2017 Results 14 Integration roadmap 2016 2017 2018 2019 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Design GSO Implement GSO organization organization Design EU Implement EU support support organization organization Design U.S. Retail Implement U.S. Retail Business Services Busine
Slide 15: U.S. operating model: local brands supported by Retail Business Services
Second Quarter 2017 Results 15 U.S. operating model: local brands supported by Retail Business Services LOCAL BRAND STRATEGIES… Ahold USA Delhaize America Local expertise within brands to win in local markets: • Marketing • Merchandising / Category • Pricing Great local brands operating with a uniqu
Slide 16: Synergies 2016 – 2019
Second Quarter 2017 Results 16 Synergies 2016 – 2019 Synergy phasing Net Synergies delivered € in million 750 2017 Gross synergies € in million 600 Q2 YTD Net synergies United States 37 72 Europe 16 31 300 500 500 Global Support Office 8 14 420 220 220 22 Ahold Delhaize Group 61 117 2016 2017 2018 2
Slide 17: Additional synergies to be reinvested in our local brands
Second Quarter 2017 Results 17 Additional synergies to be reinvested in our local brands Sources of synergies – examples Reinvestment in our brands – examples A-brands & Fresh AUSA brands: continue Harmonizing rates both in the US & Benelux, price investments leveraging our US East Coast market posi
Slide 18: One-time costs increased to set up U.S. brand-centric organization
Second Quarter 2017 Results 18 One-time costs increased to set up U.S. brand-centric organization Integration costs 2016 - 2019 U.S. Restructuring costs 2017 - 2018 of €380 million (previously €350 million) of €70 million for brand-centric model set-up • Additional integration costs to support the •
Slide 19: Transformation
Second Quarter 2017 Results 19 Transformation Single “Better Together” Strategic Framework adopted across our organization Leadership teams collaborating inspired by our common purpose “Together, we build Great Local Brands, bringing Fresh Inspiration Every Day” Pulse surveys keep sensing the mood a
Slide 20: Business Highlights
Business Highlights Dick Boer President and CEO
Slide 21: Business highlights - United States
Second Quarter 2017 Results 21 Business highlights - United States • Strong local brands with leading positions in most of our markets • Sales performance improved with return of low levels of inflation • Market shares improved (adjusted for remedy stores) • Effective commercial strategies to win in
Slide 22: Business highlights – Food Lion update
Second Quarter 2017 Results 22 Business highlights – Food Lion update • Well positioned in current competitive environment • Developed effective competitive plans, facing new competition • Over 400 competitive openings over 2014-2017 in Food Lion’s territory • Competitively priced at local level ver
Slide 23: Business highlights – Europe
Second Quarter 2017 Results 23 Business highlights – Europe The Netherlands Belgium • AH continues to improve and renew assortment: • Affiliate stores continue to perform well • Healthier and fresher assortment • First steps to improve performance owned • Improved quality of almost 500 own brand pro
Slide 24: Business highlights - Central & Southeastern Europe
Second Quarter 2017 Results 24 Business highlights - Central & Southeastern Europe • Greece: Alfa Beta competitive environment normalizing after competitor disruptions last year • Czech Republic: Albert opens third distribution center, supporting growth in supermarkets and remodeled compact hypers •
Slide 25: Business highlights - Online
Second Quarter 2017 Results 25 Business highlights - Online • Q2 net consumer sales up 22%, full year 2017 net consumer sales expected of €2.8 billion and on track to nearly €5 billion net consumer sales by 2020 • Investing €160 million to increase the online warehouse capacity: • bol.com new distri
Slide 26: Wrap up & Outlook 2017
Second Quarter 2017 Results 26 Wrap up & Outlook 2017 • Q2 2017 was a strong quarter with improved sales growth and margins, driven by synergies • Integration is well on track • Delivering strong results and making good progress building our U.S. brand centric organization • Reiterated target of rea
Slide 27: Cautionary notice
Second Quarter 2017 Results 27 Cautionary notice This communication includes forward-looking statements. All statements other than statements of historical facts may be forward-looking statements. Words such as expected, on track, leveraging, being accelerated, build, strategies, improve, renew, rem
Slide 28: Thank you
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Slide 29: Ahold Delhaize
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