We have terrific
and locally robust
brands and we
are number one or
number two in most
of our markets.
Could you talk about what
decisions the Executive
Committee took in 2014 and
how Delhaize Group thinks
about capital discipline?
2015 PRIORITIES
Sustainability will receive
increased attention at Delhaize
Group. How does sustainability
fit into the new Strategic
Framework?
OVERVIEW
Frans Muller,
President and Chief
Executive Officer of
Delhaize Group
As a result of our refined strategic think
ing, our goals and how we will accomplish
them are now clearer. The organization is
simpler. Our structure is focused on our core
business and is more transparent. The priori
ties for the Group are more defined than ever
before. In 2014, the Executive Committee set
the foundation to create a winning business
by combining hard facts with our passion for
retail.
I am convinced that an organization has
to be focused on a limited number of high-im
pact priorities. In keeping with this philosophy,
in late 2013 and continuing into 2014 we
identified which markets and banners were
core to us and then made strategic decisions
to exit non-core banners and markets. We
have further strengthened our balance sheet
through strong operating performance and by
improving working capital and capital expend
iture discipline. In the past three years we have
reduced our net debt by more than 50%.
Today, we are present in seven countries with
approximately 63% of our revenues generated
in the United States. Operations in Belgium
and Luxembourg represent around 23% of the
Group's revenues and those in Southeastern
Europe represent around 14%.
Our five core banners at Delhaize Group are
Food Lion and Hannaford (U.S.), Delhaize Le
Lion (Belgium and Luxembourg), Alfa Beta
(Greece), and Delhaize Serbia (Serbia). These
five banners will be the focus of our capital
spending during the coming years. Consistent
with our strategy, we are focusing on our key
formats of supermarket and convenience.
I While we are seeing growth, it is still
mixed across our operations, which is why
we are focusing on core markets where we
believe we can win. The environment remains
highly competitive and we believe that winning
will require us to push differentiation within our
formats to increase relevance to our custom
ers.
I Our growth is indeed being led largely
by our progress at Delhaize America. At Food
Lion, the team continues to build momentum
with its "Easy, Fresh Affordable" strategy.
Food Lion's comparable store sales growth
is among the best it has delivered during the
past decade and that performance is provid
ing optimism as we look ahead. At Hannaford,
the team continues to deliver results. They
Create value in line with our peers;
Leverage skills of our associates
work on capability gaps;
Align IT and business priorities;
Achieve progress on
2020 sustainability goals;
Accelerate share of online sales.
have maintained their strong market position
and are building on this strength. In Belgium,
the uncertainty caused by the announcement
of the Transformation Plan has negatively
impacted revenues, but will improve our com
petitiveness going forward. In Greece, despite
tough economic conditions, we continued to
expand the store network and gain market
share. In Serbia, while we have experienced
deflation, we have nevertheless been able
to increase share in the food retail channel,
and in Romania, Mega Image continued to
profitably expand in Bucharest. In Indonesia,
we continued to see strong comparable store
sales growth at Super Indo.
IFMl For Delhaize Group, sustainability is
about being the preferred supermarket for
our customers, being a good employer, being
an integral part of the local community, and
being a high-integrity partner for our suppliers.
It is a guidebook to being a great company.
We want to be known as a company where
people enjoy working, customers love shop
ping, and vendors value doing business with
us. Integrity and sustainability are synonyms
at Delhaize Group, and are embedded in our
core Values.
MUI Sustainability is at the heart of how we run
our business. In order to concretely measure
our performance, we will continue to monitor
our progress against our 2020 Sustainability
Goals. We have work to do to keep further
integrating sustainability into how we operate
and we are committed to an ambitious target,
a Supergood sustainability strategy that under
pins everything we do.
IFM Our 2020 Sustainability Goals are
ambitious and include: 100% of our stores
and warehouses donating food that is close
to expiration to feed people in our local com
munities; all Delhaize Group companies will
have leading Healthy Associates programs;
refrigerants will be 80% ozone friendly; our
recycling rate in stores and distribution centers
