Koninklijke Ahold Delhaize N.v. · EURONEXT:AD
Koninklijke Ahold Delhaize — Q4 2021 Earnings Presentation
38 slides from Koninklijke Ahold Delhaize's earnings presentation, Feb 16, 2022
Slide 1: Q4 & FY 2021 Ahold Delhaize Results
Q4 & FY 2021 Ahold Delhaize Results February 16, 2022
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 remains, committed, uncertainty, will, continue, subject to, continuing, targets, priorities, next 4 yea
Slide 3: Welcome
Welcome JP O’Meara SVP Investor Relations Ahold Delhaize – Q4/FY 2021 Results 2
Slide 4: Business Highlights
Q4 & FY 2021 Business Highlights Frans Muller, President & CEO
Slide 5: Giving back to our communities
Giving back to our communities #datetocare Ahold Delhaize – Q4/FY 2021 Results
Slide 6: Performance Review: Key Highlights
Performance Review: Key Highlights Key Financial Targets Target 2021 Results in 2021 Group underlying operating margin ≥ 4.0% 4.4% Mid-to-high single- Diluted underlying eps growth1 28.8% digit % vs. 2019 Capital expenditures, net2 ~ €2.2 billion €2.3 billion Free cash flow 2 ~ €1.6 billion €1.6 bil
Slide 7: Our omnichannel customer value proposition is at the core of how our brands grow
Our omnichannel customer value proposition is at the core of how our brands grow Scaled tech and Deeper digital Digital & capabilities Great Value relationships Fresh in-store & Healthy experience Agile culture Convenient Supply chain, Local Vibrant, easy operations & Operational Customer & Trusted
Slide 8: 4 priorities for the next 4 years
4 priorities for the next 4 years For customers For operations For H&S For our portfolio Serve Accelerate the Lead the Create the customers with omnichannel transformation ecosystem for deeper (digital) transformation & into a healthy & smarter customer relationships continue to be the sustainable f
Slide 9: Highlights: Customer Priority
Highlights: Create a uniquely local omnichannel Customer Priority customer experience for every brand • Launched Albert Heijn Premium Loyalty subscription program; already >300,000 customers • Giant Food soft-launched Ship2Me, an online marketplace solution, initially offering an additional ~40,000
Slide 10: Outlook: Customer Priority
Outlook: Create a uniquely local omnichannel Customer Priority customer experience for every brand • Completing roll out Albert Heijn To Go at 100 BP gas stations • Alfa Beta successfully opened its 100th AB Shop & Go store, aspiring to grow with another 45 stores in 2022 • Full national launch of “
Slide 11: Highlights: Operational Priority
Highlights: Enhance the long-term durability of our Operational Priority strategy by building scale and accelerating the omnichannel transformation • Opened our new eCommerce fulfillment facility in the Philadelphia market at The GIANT Company, scaling learnings to EU in 2022 • Machine Learning base
Slide 12: Outlook: Operational Priority
Outlook: Enhance the long-term durability of our Operational Priority strategy by building scale and accelerating the omnichannel transformation • In cross-EU collaboration, we are finalizing the roll-out of Price and Assortment optimization tooling at all our Europe brands with promo to follow in 2
Slide 13: Outlook: Portfolio priority
Outlook: Create the ecosystem for smarter customer Portfolio priority journeys • Bol.com is cornerstone of our Winning in Benelux strategy announced at Investor Day • For 2022, the sub-IPO of bol.com is one of our top priorities • Benelux eCommerce market highly attractive with Total Addressable Mar
Slide 14: Highlights: Healthy & Sustainable
Highlights: Lead the transformation into a healthy Healthy & Sustainable & sustainable food system • Ahold Delhaize achieves “AA” MSCI ESG 2021 ranking • Ahold Delhaize maintains position as a world leader in the DJSI ranking, second in the world • Hannaford became the first large-scale supermarket
Slide 15: Outlook: Healthy & Sustainable
Outlook: Lead the transformation into a healthy Healthy & Sustainable & sustainable food system Own brand Carbon emissions Carbon emissions in own operations in full business net- healthy food sales to net- >55% ZERO ZERO By 2025 By 2040 By 2050 Food waste Recyclable, reusable or compostable own red
Slide 16: 2022 Outlook
2022 2022 Outlook At least 4% Decline by ≥€850 million reflects positive Underlying low- to mid- Save for Our comparable Operating Margin single-digits Customers sales growth Underlying EPS Well set up to manage inflation through “should- ~€2.5 billion ~€1.7 billion cost” models, Capital Expenditure
Slide 17: Financial Highlights
Q4 2022 Financial Highlights Natalie Knight, Chief Financial Officer
Slide 18: Q4 Underlying Performance
Q4 Underlying Performance Comparable Sales Net Consumer Net sales Growth excl. gas Online Sales € 20,148 3.2% € 2,981 Million million U.S. 4.8% vs LY constant rates 0.1% E.U. 1.0% vs LY constant rates 13.2% Underlying operating Underlying Underlying Income from Diluted Underlying income operating ma
Slide 19: Q4 IFRS-reported results
Q4 IFRS-reported results Net sales Online Sales € 20,148 € 2,176 Million million vs LY constant rates 0.1% vs LY constant rates 14.7% Operating Income from Diluted Operating margin income continuing operations EPS € 895 4.4% € 634 € 0.62 Million Million vs LY constant rates NM vs LY constant rates 4
Slide 20: Full year 2021 underlying performance
Full year 2021 underlying performance 1 Comparable Sales Net Consumer Net sales 1/2 Growth excl. gas Online Sales € 75,601 2.3% € 10,401 in million in million U.S. 1.9% vs LY constant rates 3.3% E.U. 2.8% vs LY constant rates 38.2% Underlying operating Underlying 1 Underlying Income from Diluted Und
Slide 21: Full year 2021 IFRS-reported results
Full year 2021 IFRS-reported results 1 Net sales 1/2 Online sales € 75,601 € 7,704 in million in million vs LY constant rates 3.3% vs LY constant rates 40.1% IFRS reported IFRS reported Income from Diluted EPS operating income operating margin continuing operations € 3,320 4.4% € 2,246 € 2.17 in mil
Slide 22: Two-year comparable sales stack in Q4 2021
2019 2020 Two-year comparable sales stack1 in Q4 2021 Value above the bar is 2-year comparable sales ex-gas stack; within U.S. the bar is the 1-year comparable sales ex-gas for each quarter Europe 19.1% 20,0% 18.1% 20,0% (1.5)% 15.8% 16.0% 16.3% 15.5% 15.3% 15,0% 1,9% 8,3% 12.6% 15,0% 1,7% 12.3% 12.
Slide 23: Adjusting for the effects of weather and calendar
2020 Adjusting for the effects of weather and calendar 2021 Q4 2021 two-year comparable sales stack maintained mid double-digit rates in the U.S., and accelerated in Europe Value above the bar is 2-year comparable sales ex-gas stack; within U.S. the bar is the 1-year comparable sales ex-gas for each
Slide 24: Highlights: United States
Highlights: United States • Net sales grew 1.5% at constant rates, 5.9% at actual rates to €13.8 billion. Excluding last year's 53rd week, fourth quarter net sales grew by 9.2% at constant exchange rates • 30.5% online sales growth in Q4 (constant rates); Excluding the Fresh Direct acquisition, U.S.
Slide 25: Highlights: Europe
Highlights: Europe • Net sales in the fourth quarter decreased 1.9% at constant exchange rates and by 1.5% at actual rates to €8 billion. Excluding last year's 53rd week, Q4 net sales in Europe grew by 3.0% at constant exchange rates. • Q4 market share gains in the Benelux , market share remained st
Slide 26: Highlights: bol.com
Highlights: bol.com • Bol.com grew net consumer online sales growth by 7.8% in Q4; on top of 69.6% growth in the year ago period • Bol.com added approximately 1,000 merchant partners to the platform in Q4, bringing the total to ~49,000 merchant partners; sales from third-party sellers grew 9.1% in Q
Slide 27: Bol.com delivers record sales and free cash flow in 2021
Bol.com delivers record sales and free cash flow in 2021 Gross Merchandise Value Net sales 1 Net Consumer Online sales excluding VAT € 2,765 € 5,591 € 5,461 in million in million in million 2020 : €2,282 million 2020 : €4,458 million 2020 : €4,313 million Retailer 1 39% Network 61% IFRS FY21 reporte
Slide 28: Q4 and Full Year Free Cash Flow Bridge
Q4 and Full Year Free Cash Flow Bridge FCF Q4 & FY 2021 vs Last Year (in €m) 145 538 445 40 15 2 8 262 379 FCF Q4 2020 Operating Changes in Income Net Investment Net Interest Net Lease JV dividends FCF Q4 2021 Cash Flow Working Capital Tax Paid Repayment Unfavorably impacted by disputed Belgium tax
Slide 29: Outlook: Key Targets 2022 (1/2)
Outlook: Key Targets 2022 (1/2) Key Financial Targets Target 2021 Results in 2021 Target 2022 Group underlying operating margin ≥ 4.0% 4.4% ≥ 4.0% Mid-to-high single- Mid-to-low-single- Diluted underlying eps growth1 digit growth % vs. 28.8% digit % decline vs 2019 20211 Capital expenditures, net2 ~
Slide 30: Outlook: Key Targets 2022 (2/2)
Outlook: Key Targets 2022 (2/2) Drive Omnichannel Growth Target 2021 Results in 2021 Target 2022 Net consumer online sales growth / US online ≥ 30% / ≥ 60% +42% / +74% mid-teens sales growth1 Stop & shop store remodels ~ 60 55 ~ 40 Complementary revenue streams - €355 million ≥ 20% Strengthen Operat
Slide 31: Exceeded Save For Our Customers goal with €2.5 billion of cumulative savings
Exceeded Save For Our Customers goal with € 2.5 billion of cumulative savings from 2019-2021 Forecasting €4 billion of additional • Save for Our Customers savings from 2022-2025 helps fund growth ≥€850 investments, absorbs cost Initial target from 2018 €967 €2,520 pressures, and improves Capital Mar
Slide 32: Strong dividend growth from 2016 through 2021
Strong dividend growth from 2016 through 2021 • We propose a cash dividend of € 0.95 per common share for the financial year of 2021 € 0,95 • This reflects our ambition of € 0,90 sustainable growth of the dividend € 0,76 share. This represents a payout ratio € 0,70 +18.4% +5.6% of 42%, based on the
Slide 33: Our financial ambitions 2025
2025 Our financial ambitions +€10b 2x Sales growth vs. 2022 Net consumer online sales growth vs. 2021 Profitable €1b Fully allocated eCommerce Complementary revenue by 2025 streams by 2025 >€6b High-Single Digit Annual underlying EPS Cumulative growth vs. 2022 Free Cash Flow Ahold Delhaize – Q4/FY 2
Slide 34: Additional granularity on 2025 Free Cash Flow and Capex guidance
Additional granularity on 2025 Free Cash Flow and Capex guidance Capex as % of Free Cash Flow € billion Capex split per sales Category ~20pp shift to growth Step up in Group capex Grocery FCF Consistent with investments in Online and related to bol.com historical performance New stores >7bn ~3.5% ~3
Slide 35: Ahold Delhaize ends 2021 with accelerating Q4
• On a two-year comparable sales growth basis1, Q4 comparable sales excluding gas increased 16.0% in the U.S. and 11.6% in Europe, accelerating versus Q3 in both segments • Q4 Group net sales were €20.1 billion, up 0.1% at constant exchange rates compared to Q4 of 2020, which contained a 53rd week.
Slide 36: Thank you
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Slide 37: Appendix
Appendix Ahold Delhaize – Q4/FY 2021 Results 36
Slide 38: Pro Forma information: Q4 and Full Year 2021 financial data on a 13/52-week basis
Pro Forma information: Q4 and Full Year 2021 financial data on a 13/52-week basis • Considering that the 2020 financial year consisted of 53 weeks, compared with 52 weeks in 2021, with the last quarter of 2020 having 14 weeks, compared to 13 weeks in Q4 2021, Ahold Delhaize has prepared proforma inf
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