We continued to
successfully operate
in a very competitive
environment.
35
Group performance overview
Throughout 2013, market conditions continued to be tough, as
the uncertain economic climate impacted consumer spending
and customers remained value-oriented and focused on price
and promotion in all of our markets.
million
Ahold at a glance Our strategy
Our performance
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Ahold Annual Report 2013
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As in previous years, we responded to this
environment by investing in our value proposition to
ensure that our offering remained attractive to our
customers, while managing the balance between
sales and margins.
Cautious consumer spending put volume growth
under pressure and, combined with low inflation,
resulted in only modest sales growth. However, we
grew our market share in the United States and
the Netherlands, and maintained our share in the
Czech Republic.
Net sales in 2013 were €32.6 billion, down 0.2%
compared to 2012. At constant exchange rates, net
sales grew 2.0%.
In an environment of modest top-line growth, cost
control is extremely important and remains an
integral part of our strategy. The cost savings we
achieved from our Simplicity program enabled us
to continue to invest in our competitive positions in
both the United States and the Netherlands. At the
same time, our businesses benefited from optimized
store processes and improved sourcing. By the end
of 2013, we were ahead of plan on our three-year
(2012-2014) €600 million cost savings program,
having delivered approximately €480 million
to date.
Our underlying operating margin was 4.2%,
down from 4.3% in 2012. Operating income was
€1.2 billion.
Our businesses consistently generate strong cash
flow every year. In 2013, free cash flow amounted
to €1.1 billion.
In the Netherlands, following our 2012 agreement
with Jumbo to transfer 82 stores, we converted
24 more former C1000 supermarkets into our
Albert Heijn format in 2013, bringing the total to
39 stores. We also further expanded our Albert
Heijn business in Belgium, a market we entered in
2011, by opening an additional eight supermarkets,
bringing the total to 19 at year-end. We are pleased
with the current performance of these stores and
are on target to operate at least 50 supermarkets in
Belgium by the end of 2016.
By the end of 2013, we operated 59 Albert Heijn to
go convenience stores in the Netherlands and five in
Germany, where we introduced this format in 2012.
In the Czech Republic, we took additional steps
to enhance our customer proposition and
continued to gradually improve profitability this
year. After reviewing our strategic options, we
decided to exit Slovakia, where we had a limited
market position. This will enable management to
focus more on driving the continued successful
improvement of our business in the Czech Republic.
At Ahold USA, we closed some unprofitable stores
and exited the New Hampshire market, as our
stores here had not achieved their performance
goals after many years of investment.
We are pleased with the strong progress we
made in further developing our online business, in
particular, the accelerated rollout of new pick-up
points, which were either stand-alone, in-store, or
office-based. Overall we opened 112 new pick-up
points in the United States, bringing the total to 120.
In the Netherlands, Albert Heijn online opened 14
new pick-up points, bringing the total to 17.
Online sales
1,086
830
596
536
490
294
2012 2013
Food
Non-food