00 Ahold ANNUAL REPORT 2002 75
BOARD GOVERNANCE HIGHLIGHTS OPERATING REVIEW FINANCIAL INVESTOR REL AT IONS
Cash flows from operating activities
In fiscal 2002, we generated cash flows from operating activities of EUR 2.5 billion compared to EUR 2.0 billion in fiscal
2001 and EUR 2.1 billion in fiscal 2000. This increase in fiscal 2002 as compared to prior years was the result of a
variety of factors, mainly related to our results from our existing and acquired businesses, adjusted for depreciation and
the impairment of assets. Cash flows from working capital changes were EUR 107 million, EUR (166) million and EUR
208 million for fiscal 2002, fiscal 2001 and fiscal 2000, respectively. The working capital improvement in fiscal 2002
was attributable to our focus in our retail segment on collection of receivables and improved payment terms with retail
vendors, offset in part by the impact of excess inventory levels at USF. The increase in working capital needs in fiscal
2001 as compared to fiscal 2000 was a result of increased inventory levels at USF and our retail operations, offset in part
by higher accounts payable.
As discussed below, our principal uses of cash from operating activities have been for acquisitions, investment in
distribution centers, new stores, store remodeling and store expansions, as well as in other assets, and store efficiency-
improving measures and retail trade operation innovations. In fiscal 2003, we expect the principal uses of cash from
operating activities will be for debt repayments and investment in distribution centers, new stores, store remodeling and
store expansions, as well as in other assets, store efficiency-improving measures and retailing innovations.
Cash flows from investing activities and capital expenditures
In fiscal 2002, cash outflows from investing activities were EUR 2.6 billion compared to EUR 4.6 billion in fiscal 2001
and EUR 9.2 billion in fiscal 2000. Of this, capital expenditures relating to the purchase of tangible and intangible fixed
assets were EUR 2.2 billion in fiscal 2002 compared to EUR 2.5 billion in fiscal 2001 and EUR 1.9 billion in fiscal
2000. In fiscal 2002, we recorded EUR 1.1 billion in cash outflows related to acquisitions of businesses, compared to
EUR 2.8 billion and EUR 7.6 billion in fiscal 2001 and fiscal 2000, respectively. Of the capital expenditures for tangible
and intangible fixed assets and acquisitions in fiscal 2002, fiscal 2001 and fiscal 2000, approximately 34%, 54% and
80%, respectively, was attributable to acquisitions, and approximately 66%, 46% and 20%, respectively, was attributable
to new stores and store improvements, distribution centers, computer hardware and other assets. Fixed asset disposals
generated cash inflows of EUR 590 million, EUR 1.1 billion and EUR 303 million in fiscal 2002, fiscal 2001 and fiscal
2000, respectively. Cash flows for other investing activities primarily relate to issuance and repayment of loans receivables,
which are generally issued to third-party real estate developers for the purpose of developing future property to be used by
us in our operations.
The table below shows our cash flows from investing activities by category:
Fiscal 2002
Fiscal 2001
Fiscal 2000
(in EUR millions)
(restated)
(restated)
Purchases of tangible and intangible fixed assets
(2,160)
(2,459)
(1,890)
Acquisitions of businesses
(1,136)
(2,843)
(7,552)
Fixed assets disposals
590
1,134
303
Other
113
(397)
(58)
Cash flows from investing activities
(2,593)
(4,565)
(9,197)
During fiscal 2002, fiscal 2001 and fiscal 2000, we completed several acquisitions and joint venture investments. During
fiscal 2002, we acquired seven individually materially insignificant entities for a total cost of EUR 380 million. This
EUR 380 million was paid primarily in cash and assumed debt of the Company. In addition, as a result of VRH's default
on certain indebtedness in July 2002, we made an additional investment of USD 448 million (EUR 453 million) in DAIH,
a former joint venture, through the purchase of DAIH shares pursuant to guarantees and the assumption of certain debt.
This further investment resulted in our full ownership of DAIH and is further described in our financial statements.
In fiscal 2001, we acquired Alliant, Bruno's, and several other individually insignificant subsidiaries that are material in
the aggregate, for a total cost of EUR 3.8 billion in cash and assumed debt. In fiscal 2000, we acquired USF for
approximately EUR 3.8 billion, PYA/Monarch for approximately EUR 1.7 billion and seven individually insignificant
subsidiaries for a total cost of approximately EUR 1.0 billion, which was paid primarily in cash and assumed debt. In
addition, we acquired Superdiplo pursuant to an exchange offer of our common shares. For a more detailed discussion of
our acquisitions in fiscal 2002, fiscal 2001 and fiscal 2000, please see our financial statements.
Cash inflows from the disposal of fixed assets were EUR 590 million in fiscal 2002, compared to EUR 1.1 billion in fiscal
2001 and EUR 303 million in fiscal 2000. Disposal of fixed assets generally relates to the sale of individual stores,
shopping centers or parcels of land that were no longer in use or being held for sale, and also includes proceeds from sale
