Notes to the consolidated balance sheets and statements of earnings
General
Consolidation
Royal Ahold and all subsidiaries and affiliates belonging to the Group have been included in the consolidation. The share of minority
interest stockholders in equity and earnings has been entered separately in the consolidated balance sheets and in the statements of
earnings. The consolidated subsidiaries and affiliates are listed on page 54.
Acquisitions and divestments.
In 1999 the consolidated balance sheet and statement of earnings were influenced by several acquisitions and divestments. In Spain,
the supermarket chains Dialco in Seville and Dumaya in Malaga were acquired in January and the supermarket chains Castillo del Barrio
in Malaga and Guerrero in Granada in February. In September, the chains Mercasol and Las Postas in Marbella were acquired. The annual
sales of these chains amount to approximately EUR 380 million. In May, the supermarket chains Supamer and Gonzales in Argentina were
acquired by Disco, which also acquired the supermarket chain Pinocho in October, total annual sales approximately EUR 240 million.
Furthermore, in Poland, the Centrum stores were acquired in May. Also in May, Bomprego in Brazil acquired the supermarket chain
Petiprego in the province of Bahia, annual sales EUR 90 million. Ahold Institutional Food Supply acquired the Gastronoom food service
company in July, annual sales EUR 350 million. All acquisitions were consolidated as of the acquisition date. Late December the new
joint venture Paiz Ahold acquired an 80% stake in La Fragua, a supermarket and hypermarket chain based in Guatamala, with stores in
Guatamala, Honduras and El Salvador, annual sales approximately EUR 530 million. The company was consolidated in the balance sheet
as of year-end 1999.
In Asia, the operations in China and Singapore were divested in October. Furthermore, in The Netherlands the Meester and Nistna meat
processing companies were divested in October. Effective as of the fourth quarter these companies were deconsolidated.
Amounts in thousands of Euros (EUR)
Unless indicated otherwise, all amounts included in the Notes to the Consolidated Financial Statements are stated in thousands of Euros.
As of 1999 the annual accounts are stated in Euros. The comparative numbers for 1998 have been converted from Dutch guilders into Euros
using the fixed exchange rate, EUR 1 NLG 2.20371.
Accounting principles
General
The valuation of assets, stockholders' equity, provisions and liabilities and the determination of earnings are based on historical cost. Unless
otherwise indicated for specific items, all components of assets, stockholders' equity, provisions and liabilities are stated at their face values.
Fiscal years end on the Sunday nearest to December 31. The 1999 and 1998 fiscal years contained 52 weeks and 53 weeks respectively.
Foreign exchange
Transactions, receivables and liabilities in foreign currencies, resulting from ordinary activities are translated at the prevailing ra es o
exchange. The resulting exchange differences are added or charged to the statement of earnings.
In the consolidation, subsidiaries' balance sheets denominated in foreign currencies are translated at the rates of exchange prevailing at
the end of the fiscal year. The amounts on the subsidiaries' statements of earnings denominated in foreign currencies are translated at an
average rate of exchange per quarter. The resulting exchange differences are added or charged directly to stockholders' equity.
The rates of exchange applied for the US dollar (USD) were:
1999
1998
Balance sheet:
0.8558
0.9926
Year-end rate
Statement of earnings:
0.9306
0.9015
1st quarter
0.9573
0.9159
2nd quarter
0.9461
0.8958
3rd quarter
0.9681
0.8512
4th quarter
Income taxes
The income taxes for the year under review are determined based on the earnings reported in the statement of earnings, adjuste or
permanent differences between income as calculated for financial and tax reporting and the tax rates prevailing for the said year.
Deferred tax liabilities or receivables arising from temporary differences between income as calculated for financial and tax reporting
are included under 'Deferred income taxes'. The actual taxes due are included under Current liabilities
Royal Ahold Annual Report 1999
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