Message from the Corporate Executive Board
'We are poised to become one
of Europe's strongest players'
Outlook for 2000:
Sustained increase of sales and results
Strong rise of net earnings
Earnings per share 15 - 20% higher, excluding
currency fluctuations
Growth of identical sales in all trade areas
Euro 2.2 billion to be invested in existing business
Internet sales to double each year for next three years
More than 500 new and renovated stores
markets and hypermarkets. Organic
growth and in-market acquisitions have
positioned our joint ventures as promi
nent food retailers in their trade areas.
Our latest joint venture with La Fragua,
a major food retailer in Central America,
also offers considerable opportunity for
regional development and will boost
annualized sales on the continent to over
Euro 4 billion.
In Asia, we have restructured our regional
operations and divested loss-making
operations in China and Singapore.
Thailand and Malaysia generated 80% of
our Asian sales last year and hold strong
positions with plenty of scope for future
profitable growth. With annual sales
approaching Euro 500 million, we expect
to break even towards the end of this
year and grow profitably thereafter.
We have touched briefly on what it takes
to achieve our mission of becoming the
best and most successful food provider in
the world. We aim to do this by building
a global network of superior brand
names. This means generating economies
of scale, providing benchmarking tools
and stimulating best practice exchange
and knowledge transfer. These are the
cornerstones of our global strategy aimed
at adding value for our local customers.
We are now in the process of opening and
rolling out the Ahold intranet that facili
tates knowledge transfer and the
exchange of best practice among all
Ahold and Ahold-associated companies.
The global Ahold intranet helps us turn
individual expertise into organizational
know-how, through peer groups communi
cating within a virtual knowledge network.
Coupled with our ambitious mission is
the need to recruit, develop and retain
those individuals instrumental in manag
ing our operations. Ahold's worldwide
Management Development program fully
supports these goals.
We have also taken other initiatives, both
global and regional. The global sourcing
framework has identified opportunities
ranging from perishable products buying
to private labels and from branded goods
to non-food. Our global construction
group has substantially reduced the costs
of building and equipping new stores and
we have upgraded our ability to build and
operate hypermarkets, particularly in
developing areas. Our IT specialists
around the world have defined a standard
suite of software applications which will
be strongly enforced. Many of our
companies participate in a cross-border
initiative to improve their non-food
offering. We have studied in depth the
opportunities for expanding services to
our customers, including financial services.
Several of the US companies are building
and operating gas stations on their
parking lots. And these are just a few
of the many initiatives...
In e-commerce, Ahold is using the internet
to service the food needs of existing and
new customers in the US, Europe and
large centers in Latin America. We
already extensively use the internet to
speed up supply chain activities and
liaise with partners in the business-to-
business arena. Currently, for the
-4
12 Royal Ahold Annual Report 1999
