- Fiscal 2002
Despite the weak economic conditions, our net sales in Europe, excluding Albert Heijn, increased by EUR 385 million, or
5.7%, to EUR 7.1 billion in fiscal 2002 compared to fiscal 2001, reflecting primarily net sales growth at identical stores
at Schuitema in The Netherlands. In Spain and in Central Europe, net sales also increased due to new store openings.
Our expansion in the Slovakian market, where we opened our first store in December 2001, along with the acquisition in
September 2002 of five Jumbo hypermarkets in Poland, also contributed to the increase in net sales growth. Net sales
from the other specialty retailers in The Netherlands, Gall Gall, Etos, De Tuinen and Jamin remained almost flat.
We incurred an operating loss in our segment for other Europe retail trade operations of EUR 916 million in fiscal 2002,
compared to operating income of EUR 41 million in fiscal 2001. The operating loss in fiscal 2002 was due to a significant
increase in operating expenses, primarily relating to impairment charges, which was slightly offset by an improvement in
gross profit. Gross profit in our other Europe retail trade segment was positively affected by inflation, which increased net
sales in Spain and The Netherlands. As discussed above, operating expenses increased significantly primarily due to
goodwill impairment charges of EUR 882 million relating to Ahold Supermercados in Spain, as well as EUR 67 million of
fixed asset impairments mainly relating to the Czech Republic, Poland and Spain. Additionally, in Spain, we continued to
incur expenses related to the integration of Superdiplo, the closing of several stores and start-up costs with respect to the
opening of several stores. We also incurred expenses relating to start-up costs for our operations in Slovakia. We expect to
establish a Central European office called Ahold Central Europe, s.r.o. to combine the logistics, buying, computer support
and various other administrative functions for the operations in the Czech Republic, Slovakia and Poland. The office is
intended to reduce administrative expenses in the future. At Schuitema, operating expenses decreased slightly, as a
percentage of net sales, due to improved efficiency resulting from further integration of the A&P stores that were acquired
in September 2000.
- Fiscal 2001
Net sales in our segment for other Europe retail trade operations increased by EUR 2.6 billion, or 62.6%, to EUR 6.7
billion in fiscal 2001 compared to fiscal 2000. Net sales were higher in all countries in this trade area. In the Czech
Republic and Poland, the net sales increase was mainly attributable to the opening of new supermarkets and
hypermarkets. In Spain, net sales increased largely as a result of the full-year consolidation of Superdiplo, which was
acquired in December 2000. In The Netherlands, net sales at Schuitema reflected the full-year impact of the acquisition
of the A&P stores that were acquired in September 2000. However, excluding this acquisition, Schuitema, along with the
other specialty retailers in The Netherlands, still achieved net sales growth within their existing operations.
Operating income in our segment for other Europe retail trade operations decreased by EUR 59 million, or 59.0%, to
EUR 41 million in fiscal 2001 compared to fiscal 2000. As a percentage of net sales, operating income declined from
2.4% in fiscal 2000 to 0.6% in fiscal 2001. The decrease in operating income reflects an increase in operating expenses
primarily due to continued costs incurred in fiscal 2001 in integrating Superdiplo into Ahold Supermercados in Spain and
the integration of the A&P stores into Schuitema.
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