Koninklijke Ahold Delhaize N.v. · EURONEXT:AD
Koninklijke Ahold Delhaize — Q4 2020 Earnings Presentation
34 slides from Koninklijke Ahold Delhaize's earnings presentation, Feb 17, 2021
Slide 1: Q4 & FY 2020 Ahold Delhaize Results
Q4 & FY 2020 Ahold Delhaize Results February 17, 2021
Slide 2: Cautionary notice
Cautionary notice This communication includes forward-looking statements. All statements other than statements of historical facts may be forward-looking statements. Words and expressions such as improve, constant, growth, target(s), will, retain, goal, through, progress, on track, promises, expecta
Slide 3: Business Highlights
Business Highlights Frans Muller, President & CEO
Slide 4: Ended 2020 with strong results driven by COVID-19
Ended 2020 with strong results driven by COVID-19 In 2020, the Ahold Delhaize brands focused on fulfilling their vital role in society and meeting the challenges of COVID-19 by contributing €680 million to support customers, associates, and communities with COVID-19 relief care; brands committed to
Slide 5: Entering 2021 in a strategically stronger position vs pre-COVID-19
Entering 2021 in a strategically stronger position vs pre-COVID-19 Improved position in 2020… …leads to confidence in 2021 outlook ▪ Exceeding CMD 2018 financial targets ▪ Group net consumer online sales growth of over 30% in 2021 (over 60% growth in the U.S.) ▪ Grew overall market share in 2020, an
Slide 6: Outlook 2021: Key Targets (1/2)
Outlook 2021: Key Targets (1/2) Key financial targets Target 2020 Results in 2020 Target 2021 Group underlying operating margin Broadly in line with 2019 (4.2%) 4.8% ≥ 4.0% Diluted underlying EPS growth1 Mid-single-digit % growth 33.3% Mid to high single-digit % vs. 2019 Capital expenditures, net €2
Slide 7: Outlook 2021: Key Targets (2/2)
Outlook 2021: Key Targets (2/2) Drive omnichannel growth Target 2020 Results in 2020 Target 2021 Net consumer online sales 1 Progress to achieving €7 billion by €7.6 billion ≥ 30% 2021 U.S. online sales growth1 > 30% +105% ≥ 60% Stop & Shop store remodels2 48 33 ~ 60 Bol.com net consumer online sale
Slide 8: Progress versus initial 2018 Capital Markets Day promises (1/2)
Progress versus initial 2018 Capital Markets Day promises (1/2) Group financial guidance Status as of FY 2020 Annual Free cash flow of ~€1.8 billion1 for 2019 through 2021 Average Free cash flow of ~€2 billion in 2019 and 2020 €1.8 billion in cumulative Save for Our Customers savings from Over €1.5
Slide 9: Progress versus initial 2018 Capital Markets Day promises (2/2)
Progress versus initial 2018 Capital Markets Day promises (2/2) Re-imagine Stop & Shop Status as of FY 2020 Sales uplift from remodeled stores of 4%-6% in year 1; Sales run-rate in 2020 in line with expectations 2%-4% in year 2; 2% in year 3 1 Remodel 60-80 stores per year Remodelled 75 stores since
Slide 10: Strengthens position as industry-leading local omnichannel retailer in 2021+ (1/3)
Strengthens position as industry-leading local omnichannel retailer in 2021+ (1/3) Strengthened leading market share position #1 and #2 market share positions1 in 2020 +25% U.S. Benelux CSE Gained U.S. Gained Benelux Maintained CSE market share market share market share in 2020 in 2020 in 2020 1. Ex
Slide 11: Strengthens position as industry-leading local omnichannel retailer in 2021+ (2/3)
Strengthens position as industry-leading local omnichannel retailer in 2021+ (2/3) Additional wallet share opportunities remain € 10 Capitalize on consumer €9 Net Consumer Online Sales >30% 2021 Guidance €8 behavior changes €7 €6 +67% Group Net Consumer Online Sales €5 to grow over 30% in 2021 Such
Slide 12: Strengthens position as industry-leading local omnichannel retailer in 2021+ (3/3)
Strengthens position as industry-leading local omnichannel retailer in 2021+ (3/3) Bringing to life, and building upon key initiatives previously announced in Q3 2020 Step-up online capacity, supply chain and technological Advance omnichannel Improving online productivity is capabilities offerings a
Slide 13: Highlights: ESG
Highlights: ESG Ahold Delhaize was recognized as a world leader in U.S. brands were recognized as "Best Places to Work for the Food and Staples Retailing sector in the 2020 LGBTQ+ Equality,” receiving a perfect score on the Human Rights Campaign Foundation's 2021 Corporate 1 Dow Jones Sustainability
Slide 14: Highlights: United States
Highlights: United States ~129% online sales growth in Q4 (constant rates); achieved revised full year target of 90%+ growth with 2020 U.S. online sales up 105% (constant rates) 1,116 click & collect points at the end of Q4 (up from 883 in Q3); met target of 1,100+ in 2020 Completed 33 Stop & Shop r
Slide 15: Highlights: Europe
Highlights: Europe 73.4% net consumer online sales growth in Q4, and 57.4% in 2020 Bol.com grew net consumer online sales by ~70% in Q4 and added roughly 1 4,000+ Bol.com merchant partners to the platform, bringing the total to 41,000+ merchants (up from 26,000+ in early 2020); sales from third-part
Slide 16: Financial Highlights
Financial Highlights Natalie Knight, Chief Financial Officer
Slide 17: Q4 underlying performance
Q4 underlying performance 1 Comparable Sales Net Consumer Net sales 1/2 Growth excl. gas Online Sales € 19,600 11.0% € 2,604 in million in million U.S. 11.2% vs LY constant rates 18.0% E.U. 10.6% vs LY constant rates 84.2% Underlying operating Underlying 1 Underlying Income from Diluted Underlying 1
Slide 18: Q4 IFRS-reported results
Q4 IFRS-reported results 1 Comparable sales 1/2 Net sales Online sales growth excl. gas € 19,600 11.0% € 1,869 in million in million U.S. 11.2% vs LY constant rates 18.0% E.U. 10.6% vs LY constant rates 75.1% IFRS Q4 reported IFRS Q4 reported Income from Diluted EPS operating income operating margin
Slide 19: Full year 2020 underlying performance
Full year 2020 underlying performance 1 Comparable Sales Net Consumer Net sales 1/2 Growth excl. gas Online Sales € 74,736 12.5% € 7,576 in million in million U.S. 14.4% vs LY constant rates 14.2% E.U. 9.6% vs LY constant rates 67.4% Underlying operating Underlying 1 Underlying Income from Diluted U
Slide 20: Full year 2020 IFRS-reported results
Full year 2020 IFRS-reported results 1 Comparable Sales Net sales 1/2 Growth excl. gas Online sales € 74,736 12.5% € 5,547 in million in million U.S. 14.4% vs LY constant rates 14.2% E.U. 9.6% vs LY constant rates 59.8% IFRS FY20 reported IFRS FY20 reported Income from Diluted EPS operating income o
Slide 21: High sales growth in both regions drove higher underlying operating income in Q4
High sales growth in both regions drove higher underlying operating income in Q4 Ahold Delhaize The United States Europe Group Net consumer online sales Q4 % change Q4 % change Q4 % change grew nearly 129% in the U.S. constant constant constant 2020 rates 2020 rates 2020 rates and 73% in Europe € mi
Slide 22: Strong U.S. sales leverage drove Group underlying operating margin expansion in 2020
Strong U.S. sales leverage drove Group underlying operating margin expansion in 2020 Ahold Delhaize The United States Europe Group Net consumer online sales % change % change % change FY constant FY constant FY constant grew 105% in the U.S. and 57% 2020 rates 2020 rates 2020 rates in Europe € milli
Slide 23: U.S. committed to contribute over €1.4 billion to improve the security of pension benefits
U.S. committed to contribute over €1.4 billion to improve the security of pension benefits and reduce the financial risk FELRA/MAP As of December 29, 2019 Pension related liability of €676 million Ahold Delhaize's Annual Plan deficit/ Ahold Delhaize's proportionate share paid over the course of 25 y
Slide 24: Q4 and Full Year Free Cash Flow Bridge
Q4 and Full Year Free Cash Flow Bridge FCF Q4 & FY 2020 vs Last Year (in €m) Unfavorably impacted by Q4 pension plan withdrawals and incremental pension funding payments of €592 million 1,008 529 168 69 238 262 6 54 19 FCF Q4 2019 Operating Changes in Income Tax Paid Net Investment Net Interest Net
Slide 25: Strong dividend growth from 2016 through 2020
Strong dividend growth from 2016 through 2020 € 1.00 € 0.90 € 0.90 € 0.76 +18.4% € 0.80 € 0.70 € 0.70 € 0.63 +8.6% € 0.57 +11.1% € 0.60 € 0.50 +10.5% € 0.40 € 0.30 € 0.20 € 0.10 € 0.00 2016 2017 2017 2019 2020 We propose a cash dividend of € 0.90 per common share for the financial year of 2020; high
Slide 26: 2021 Outlook reflects the strength we continue to see in our business model
2021 Outlook reflects the strength we continue to see in our business model COVID-19 continues to create significant uncertainty in 2021 and created difficult prior year comparisons. The return to a 52-week calendar vs. a 53-week calendar in 2020 also has an unfavorable effect Underlying operating m
Slide 27: Raising cumulative Save For Our Customers goal to €2.3 billion from 2019-2021
Raising cumulative Save For Our Customers goal to € 2.3 billion from 2019- 2021 New Save For Our Customers cumulative 2019 – 2021 savings €2,300 €750 target of € 2,200 € 150 Save for Our Customers helps fund €244 € 2.3 billion growth investments, absorbs cost € 2,000 € 1,800 € 600 pressures, and imp
Slide 28: Wrap-up
Wrap-up Entering 2021 in a strategically stronger position versus pre-COVID-19 Exceeded 2020 underlying EPS growth guidance and posted free cash flow of €2.2 billion vs. outlook of above €1.7 billion Exceeding key multi-year financial targets established at our 2018 Capital Markets Day; reached net
Slide 29: Ahold Delhaize
@% Ahold @ Delhaize
Slide 30: Thank you
2S Ahold Delhaize Thank you l albert @ FOODAALION $sTopssHoP. GIANT MARTINS & Giant Qe (3) ctos @ Retail Business Sa Services: #2) Peapsd @ DIED €F Tempo fRiSsewenouaes TENAFOOD sfreshdirect roctononimar Abele ¥% Delhaize
Slide 31: Appendix
@% Ahold @ Delhai ize Appendix
Slide 32: The call to action in ESG
the call to ESG Action Items action in ESG Climate % Reduction Human in CO2 Diversity & Rights Plastic Waste Inclusion % Plastic Committed to Healthy science-based sales targets for Strive for Embraced clear Food waste Aim of zero -50% 100% % Food shrink standards on Goal to have human rights; 51% d
Slide 33: U.S. Supply Chain Transformation Financial Impact (Updated)
U.S. Supply Chain Transformation Financial Impact (Updated) Timetable is on schedule; lower than expected transition expenses in ’20; Capex in ‘21/’22 higher due to IT costs $ in million 2020 2021 2022 2023+ Transition Expenses* (new) $42 $50 $60 $0 Transition Expenses* (previous) $50 $50 $60 $0 Net
Slide 34: Pro Forma information: Q4 and Full Year 2020 financial data on a 13/52-week basis
Pro Forma information: Q4 and Full Year 2020 financial data on a 13/52- week basis Considering that the financial year consisted of 53 weeks in 2020, compared with 52 weeks in 2019, with the last quarter of 2020 having 14 weeks, compared to 13 weeks in 2019, Ahold Delhaize has prepared pro forma inf
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