Ordinary and Extraordinary General Meeting. Brussels, May 24, 2012

Transcription

1 Ordinary and Extraordinary General Meeting Brussels, May 24,

2 Results and accomplishments 2011 Count Georges Jacobs de Hagen Chairman of the Board of Directors of Delhaize Group 2

3 Tough economic climate in most of our regions

4 The New Game Plan as point of focus 4

5 Accelerate profitable revenue growth Revenue growth YoY at identical exchange rates 4.9% 4.1% 4.6% Including Delta Maxi 2.6% 1.0% +2.4% * 2009** * Adjusted for 53 rd revenues week in the U.S. in 2008 ** Adjusted for 53 rd revenues week in the U.S. in Actual revenue growth excluding this adjustment amounted to 1.2% at identical exchange rates. 5

6 U.S. comparable store sales impacted by increased competition Delhaize U.S. Revenue growth (in local currency) and Comparable store sales evolution (YoY) 4.3% 3.5% -0.3% 1.6% 1.9% 1.0% 0.1% -0.4% Q Q Q Q Comparable store sales growth Revenue growth Increased competitive activity and lower consumer spending in Q repositioned FOOD LION stores : significant outperformance vs rest of the network and positive volume growth since launch Bottom Dollar Food stores in Philadelphia : excellent revenue growth 6

7 Delhaize Belgium comparable store sales suffered from challenging climate Delhaize Belgium - Revenue growth and Comparable store sales evolution (YoY) 1.7% 0.9% 0.9% 0.0% 0.0% 0.2% -0.4% -1.5% Q Q Q Q revenue growth mostly coming from proximity and convenience stores Comparable store sales growth Revenue growth Full year: Revenue growth of +0.9% Comparable store sales growth of -0.6% Comparable store sales evolution of -0.6% for 2011, impacted by challenging economic and competitive climate 7

8 Southeastern Europe outpaces the Group s growth Proportion of Delhaize Group revenues and operating profit coming from Southeastern Europe 12.0% Revenue growth (YoY) 10.0% 40.0% 8.0% 35.0% 30.0% 6.0% 25.0% 20.0% 4.0% 15.0% 10.0% 2.0% 5.0% 0.0% Proportion of DG revenues coming from Southeastern Europe 0.0% SEE Revenue Growth DG Revenue Growth Proportion of DG operating profit coming from Southeastern Europe Excluding impairment charge at Delhaize U.S. in

9 Rapid store expansion in SEE & Asia New store evolution in SEE & Asia segment, excluding the 492 Maxi stores +87.8%

10 Group underlying operating margin impacted by soft revenues in the U.S. and costs related to our growth initiatives Underlying operating margin Delhaize Group 6.0% 4.7% 4.4% 4.8% 4.4% 4.1% 4.4% 4.8% Q Q Q Q Q Q Q Q Full year 2010: 5.0% Full year 2011: 4.4% 10

11 Cost savings are re-invested in the business Source Use -Increased labor efficiency -Savings in repair and maintenance -Energy reduction initiatives -Efficiency improvements in stores Cost of sales savings SG&A savings EUR 500 million gross annual savings target to be exceeded by the end of 2012 Price decreases Offset cost increases Fund strategic initiatives 11

12 Net dividend Delhaize Group EUR USD * Average annual evolution USD/EUR % % -8.4% -6.8% +5.4% +5.2% -4.8% Payout Ratio (Group share in net profit - %) 35.5% 31.4% 36.4% 35.2% 31.9% 31.4% 30.4% 37.8% (*) Converted at rate of May 23,

13 New Board member Shari Ballard New independent Board member Top executive at Best Buy, a USD 50 billion U.S. electronic retailer - President, Best Buy International Enterprise and Executive Vice President - Former Co-President of the Americas - Former Executive Vice President, Retail Channel Management 13

14 Board of Directors mandate renewal Claire Babrowski Pierre-Olivier Beckers Didier Smits 14

15 Remuneration Report 15

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17 Welcome Mats Jansson New Chairman - Member of Delhaize Group Board since Former President of ICA Detaljhandel and Deputy CEO and Chairman of ICA Group - President and CEO of Scandinavian Airlines SAS (2006 to 2010) - CEO of Axfood (2000 to 2005) 17

18 Thank you Bob! Robert J. Murray - Board Member since Former Board Member of Hannaford - Chairman Delhaize Group Audit Committee from 2001 until Former EVP North Atlantic Group Gillette 18

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20 Strategy update Pierre-Olivier Beckers President and Chief Executive Officer Delhaize Group 20

21 Thank you Georges! Count Jacobs de Hagen - Board Member since Chairman Delhaize Group from 2005 until Former President of the Executive Committee and former chairman of UCB - Former President of BusinessEurope - Former Management Committee Member and Honorary Chairman of the Federation of Belgian Companies 21

22 Staying focused on the New Game Plan... Strengthen brand equity Accelerate organic growth in newer operations Healthy eating, food safety and responsible sourcing Associate health, well being and development External growth through strategic acquisitions Climate change On track to exceed our stated gross annual cost savings target of EUR 500 million target by the end of

23 Delhaize America as powerful platform Own go-to market strategy Own go-to market strategy Own go-to market strategy Own go-to market strategy Common supply chain Common procurement Shared services back office 23

24 Food Lion brand repositioning delivering promising results May 4, 2011 PHASE ONE 200 stores 2012 PHASE TWO 2012 PHASE THREE 250 stores 260 stores FOLLOWING PHASES Comparable Store Sales growth in Q1: +2.9% Outperformed the rest of the network by 5% Real growth in Q1: +1.8% Outperformed the rest of the network by 8% -1.8% Number of transactions* - Raleigh market New Food Lion brand strategy work implemented in early May % 0.8% 2.1% 4.0% Q Q Q3 201 Q Q * On a comparable store sales basis 24

25 Food Lion repositioning lays solid foundation under future growth Price decreases will have a short term impact on operating margins but......will lead to higher customer loyalty......which will lead to sustainable revenue growth......and an increase in total profit from operations. 25

26 People are lining up for opening new Bottom Dollar Food stores 26

27 Bottom Dollar Food expands in high-potential markets - approximately 6,500 items - 18,000 square feet - no-frills shopping Pittsburgh 14 new stores opened since start of 2012 and plans to open more Philadelphia 35 stores currently in the greater Philadelphia area and plans to open more environment - national and private brands that matter most to customers - cheapest price positioning in the market 27

28 Building on the historical strengths of Delhaize Belgium Expert in Food, variety and service while continuing to improve our price competitiveness

29 Further improve price competitiveness across the group in 2012 Alfa Beta prices back at 2008 levels Hannaford launched lower prices in the second quarter Mega Image launched new price campaign «And small prices, and close to home» Prices in free fall at Maxi Committed to further improve our price positioning throughout our Group in

30 Maxi first steps taken since acquisition resulting in growth numbers Restored relationship with local suppliers Improved in-store conditions eliminated stock outs Strengthened management team to ensure alignment Internal and external alignment on brands Clarified store format strategy Opportunities in private brands Refined pricing strategy in line with New Game Plan Leading to positive volume growth and 3.8% comparable store sales growth in the first quarter of 2012 in Serbia 30

31 Growing stronger in rough water 31

32 Safeguard New Game Plan priorities through step up of cost savings and capital efficiencies Invest in innovation and lower prices Generate cost savings Drive sales momentum and create sales leverage On track to exceed target of EUR 500 million gross annual savings by the end of 2012 through additional cost savings opportunities Increase free cash flow generation by revising investment plans for 2012 and improving working capital EUR million expected capital expenditures for

33 Portfolio optimization: focus on profitable growth Closing of 126 underperforming stores in low density areas 3 main objectives: Optimise our capital allocation Simplify the way we do business Additional resources to reinvest in our business Annual positive impact on operating profit of EUR 35 to 40 million 33

34 Our values 34