Other derivative instruments
Fair value of financial instruments
30 Commitments and contingencies
Commitments
00 Ahold ANNUAL REPORT 2002 161
BOARD GOVERNANCE HIGHLIGHTS OPERATING REVIEW FINANCIAL INVESTOR REL AT IONS
In countries where the local currency is subject to large fluctuations, Ahold often enters into lease agreements denominated
in currencies that differ from the local currency (historically, this included the US dollar and currencies subsequently
replaced by the Euro). As a result, the Company had embedded foreign exchange derivatives in certain lease contracts
in the Czech Republic, Slovakia and Poland. Under Dutch GAAP these embedded derivatives are not accounted for
separately.
The following table presents the nominal amounts and fair values of Ahold's financial instruments:
December 29,2002 December 30, 2001
Nominal amount Fair value Nominal amount Fair value
Assets
Loans receivable
342
350
709
712
Liabilities
Borrowings
(11,909)
(13,836)
(13,143)
(14,107)
Derivative financial instruments
Currency derivatives
Cross currency derivatives
Interest rate derivatives
414
3,418
849
(4)
12
39
225
3,456
1,029
5
(367)
Fuel derivatives
14 mln gallons
1 15 mln gallons
(3)
The carrying amounts of cash, accounts receivable, accounts payable, current loans payable and capital lease
commitments approximate their fair value due to the short-term nature of these instruments.
The fair value of long-term debt is estimated using discounted cash flow analysis based on interest rates from similar types
of borrowing arrangements or at quoted market prices, if applicable. The fair value of derivative financial instruments is
the amount at which these instruments could be settled, based on estimates obtained from financial institutions.
Ahold has rent commitments and capital investment commitments. Both are specified below.
Rent commitments
The annual costs of rentals and operating leases were as follows:
Fiscal 2002
Fiscal 2001
Fiscal 2000
Minimum rentals
970
902
647
Contingent rentals
22
16
27
Leases and sublease income
(126)
(155)
(136)
866
763
538
Certain of the leases provide for contingent additional rentals based on a percentage of sales. Substantially all of the store
leases have renewal options for additional terms. No leases impose restrictions on the Company's ability to pay dividends,
incur additional debt, or enter into additional leasing arrangements.
