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Ahold Delhaize Annual Report 2016
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7
18
The 2016 gains and losses at Ahold USA
mainly related to the sale of remedy stores
(€19 million).
Restructuring and related charges and
other items
Restructuring and related charges and other
items in 2016 and 2015 were as follows:
Restructuring and related charges and other
items in 2016 were €233 million, up by €111 million
compared to 2015. The increase is related
to the merger between Ahold and Delhaize.
In 2016, the restructuring and related charges of
€233 million included €38 million of transaction
costs and €107 million of integration costs
related to the merger between Ahold and
Delhaize, as well as €26 million related to
divestment of the remedy stores and other
divestments. It also included a lump-sum
compensation for a reduction in benefits for
employees in the Netherlands and the Global
Support Office (€35 million).
In 2015, restructuring charges related to a
reorganization of Ahold USA’s support office
(negatively affecting operating income by
€14 million), as well as an early retirement
incentive offered to Giant Landover store
employees, with an impact of €17 million.
Net financial expenses
Net financial expenses in 2016 increased
by €276 million, or 104.2%, to €541 million
compared to €265 million in 2015. This was
mainly due the the increase in Other financial
expenses (€244 million), which consisted
mainly of the one-off finance cost of
€243 million relating to the buy-back of the
JPY 33,000 million notes. Net interest expense
increased by €32 million compared to 2015
driven by higher interest expenses on debt
(€49 million) and finance lease commitments
(€11 million), which was partly offset by the
amortization of the fair value allocation of
the debt brought in through acquisitions
(see Note 4 to the consolidated financial
statements') and higher interest income.
Interest expense and interest income mainly
increased as a result of the merger with the
Delhaize Group.
Restructuring charges recognized at CSE were
related to the acquisition of SPAR in 2014.
Global Support Office restructuring charges for
2015 were mainly transaction costs related to
the merger with Delhaize (€37 million).
Operating income
Operating income in 2016 increased by
€266 million, or 20.2%, to €1,584 million
compared to €1,318 million in 2015. The increase
of €266 million is the difference between
the higher gross profit of €2,935 million and
higher operating expenses of €2,669 million.
The changes in gross profit and operating
expenses are explained above.
Share in income of joint ventures
Ahold Delhaize’s share in income of joint
ventures, which relates primarily to our 49%
shareholding in JMR and 51% share in Super
Indo, was €34 million in 2016, up by €14 million
compared to last year. For further information
about joint ventures, see Note 14 to the
consolidated financial statements.
Results from discontinued operations
Results from discontinued operations in
2016 were nil, versus a gain of €2 million
in 2015. In 2015, results from discontinued
operations were impacted by various
adjustments to the results of prior years’
divestments as a consequence of warranties
and indemnifications provided in the relevant
sales agreements.
For further information about discontinued
operations, see Note 5 to the consolidated
financial statements.
Gains and losses on the sale of assets
Ahold Delhaize recorded the following gains
on the sale of non-current assets in 2016
and 2015:
Income taxes
In 2016, income tax expense was €247 million,
up by €23 million compared to €224 million in
2015. The increase in income tax expense in
2016 is mainly the result of positive one-time
items in 2015. The effective tax rate, calculated
as a percentage of income before income tax,
was 23.7% in 2016 (2015: 21.3%).
(93)
(233)
(16)
(44)
(122)
2016
~27
(5)
22
(2)
2
2015
11
2016
(32)
(35)
(7)
2015
million
Ahold USA
Delhaize America
The Netherlands
Belgium
Central and
Southeastern Europe
Global Support Office
Total
million
Ahold USA
Delhaize America
The Netherlands
Belgium
Central and
Southeastern Europe
Global Support Office
Total
52
