Ahold announced consolidated net sales of $9.5 billion (8.1 billion euros) for the fourth quarter of 2014, an increase of 7.9 percent compared to the fourth quarter of 2013. At constant exchange rates net sales were up 2.6 percent for the year ended December 28, 2014.
For the full year 2014, consolidated net sales were $38.5 billion (32.8 billion euros), an increase of 0.5 percent compared to fiscal 2013. At constant exchange rates, net sales were up 0.8 percent.
In the United States, Ahold said it was pleased with the progress of its program to improve its customer proposition, which was deployed to 523 stores by the end of the year. Identical sales (excluding gasoline) increased 0.3 percent compared to negative 2.0 percent last year and negative 0.2 percent in the previous quarter (adjusted for the market disruption in New England due to the Market Basket business slowdown). Net sales were down 0.5 percent in the fourth quarter reflecting lower gas sales due to significant price deflation. Market share for the fourth quarter and for the full year was down slightly, mainly related to Giant/Landover. Ahold said that investments in its customer proposition continue to be largely funded by cost reductions from its “Simplicity” program and it expects underlying operating margin for the fourth quarter to be broadly in line with the previous quarter (which was 3.8 percent).
In the Netherlands, the Zaandam-based retailer’s sales performance significantly improved with net sales up 4.5 percent in the fourth quarter, driven by identical sales growth of 2.2 percent and by further extending Albert Heijn’s network in the Netherlands and Belgium, the company noted. Sales in the quarter also reflected a strong holiday performance from Albert Heijn stores and its online businesses Albert Heijn Online and bol.com. Consequently, for the fourth quarter, market share at Albert Heijn increased compared to last year, while for the full year, market share improved slightly. Partially due to increased promotional activity, the Dutch merchant said its underlying operating margin in the Netherlands for the fourth quarter would be slightly lower than the previous quarter (which was 4.9 percent).
In the Czech Republic, the integration of the SPAR stores is well under way, resulting in net sales growth of 32.6 percent. Ahold noted that the underlying operating margin will be impacted by the consolidation of the SPAR stores.
Ahold said it expects its free cash flow for the year to be higher than guided in its previous outlook. The big retailer will release its full financial statement including earnings late next month.
In related Ahold news, the company announced that Sander van der Laan will be leaving the retailer after 16 years, effective February 1. Most recently, van der Laan, 46, served as CEO of Albert Heijn and was a member of Ahold’s executive committee.
He will be replaced by Wouter Kolk, currently executive VP-specialty stores and new market; he will also join the executive committee at Ahold.
Kolk, 48, re-joined Ahold in 2013 following a six-year stint as CEO of international retailer WE Fashion. He first started at Ahold in 1991, and over the next 16 years served in several commercial and operational management roles, including commercial director-Asia/Pacific based in Singapore; regional director-Albert Heijn; general manager-Gall & Gall; and, until 2007, general manager-Etos.
Ahold CEO Dick Boer stated: “Albert Heijn’s brand equity and heritage, our position in society, and our relationship with millions of loyal customers are key elements that make the company one of the best-run supermarkets in the industry. I am pleased that Wouter comes from within our own organization. He is an experienced leader with a strong track record throughout our company.”
As for Sander van der Laan, who had a brief stint in the U.S. for Ahold heading its Giant Carlisle unit, Boer commented: “On behalf of our executive committee, I would like to thank Sander for his outstanding service and greatly valued contributions to our company. Under his leadership, Albert Heijn introduced iconic and award-winning commercial campaigns that were much appreciated by our customers. In addition, Albert Heijn developed into a multi-channel brand, and successfully expanded into new geographies. We wish Sander all the very best for the future.”
Sander van der Laan has had an extensive career at Ahold, having first joined the company in 1998 as a unit manager for Albert Heijn. In 2002, van der Laan was appointed general manager of Gall & Gall. In 2003, he became a member of the Albert Heijn executive team, responsible for marketing and merchandising as commercial director. In 2008, he relocated to the United States and was appointed president and CEO of Giant/Carlisle. After his return to the Netherlands in 2010, he became responsible for Albert Heijn as CEO.
Sander van der Laan stated: “I am very grateful to Ahold for all of the professional opportunities offered to me over the years. It has been a true privilege to work for this great company, with its highly motivated associates and strong customer base. I wish Wouter, the company and its associates all the very best.”
Rob van den Bergh, chairman of Ahold’s supervisory board, said: “On behalf of the supervisory board, I would like to sincerely thank Sander for all his efforts and the strong contribution he has made to Ahold. We wish him well. Additionally, I would like to wish Wouter every success. We are confident that his skills, knowledge and expertise will be of great benefit to the company in the years to come.”
