Key Financial and Strategic Ambitions for 2025-2028:
- Outperform Traditional Grocery Market: Achieve a 4% net sales CAGR.
- Maintain Operating Margins: Industry-leading underlying operating margins averaging 4%.
- Increase Savings: Raise “Save for Our Customer” ambition to a cumulative €5 billion.
- Capital Expenditure: Maintain gross cash capital expenditure at 3% of net sales.
- Earnings Growth: Grow underlying earnings per share at a high-single-digit CAGR compared to 2024.
- Strong Cash Flow: Generate €9 billion in free cash flow (post-tax).
- Shareholder Returns: Intend €1 billion annual share buybacks** and increase dividend per share annually within the dividend payout corridor**.
- Complementary Income Streams: Grow to around €3 billion by 2028.
- Own Brand Sales: Increase Own Brand share to 45% of total store sales, moving healthy sales from solely Own Brand to full store sales, enhancing price perception through effective assortments and promotions.
- Omnichannel Loyalty: Boost loyalty sales penetration to over 80% and target 30 million monthly active users by 2028.
- Sustainability Goals: Progress on reducing scope 1, 2, and 3 emissions.
- Inclusive Workforce: Strive for a workforce that is 100% gender balanced, 100% reflective of our communities, and 100% inclusive.
Zaandam, the Netherlands, May 23, 2024 – Ahold Delhaize has launched its “Growing Together” strategy during its 2024 Strategy Day, setting forth key plans and ambitions towards 2028. This growth and investment plan reinforces Ahold Delhaize’s vision to be the trusted local food retailer, focusing on vibrant customer experiences and trusted products.
Frans Muller, President and CEO of Ahold Delhaize, stated, “We have developed this strategy with a multi-stakeholder approach, balancing the needs of our customers, employees, and society. ‘Growing Together’ ensures we remain at the forefront of innovation in healthy foods, omnichannel experiences, and supply chain transformation. We are committed to realizing our growth potential by focusing on our strengths, investing in our people, and leveraging technology. We are excited to unlock our purpose.”
The growth model will be driven by six strategic priorities at both brand and functional levels, aligning with the company’s purpose, vision, and values to mutually reinforce each other.
Ahold Delhaize Unveils New Growth Strategy Focused on Innovation and Own-Brand Products
Ahold Delhaize Launches “Growing Together” Strategy, Leveraging Core Strengths
Key Financial and Strategic Goals for 2025-2028:
- Sales Growth: Outperform the traditional grocery market with a 4% net sales CAGR.
- Operating Margins: Maintain industry-leading underlying operating margins averaging 4%.
- Cost Savings: Increase the “Save for Our Customer” initiative to achieve €5 billion in cumulative savings.
- Capital Expenditure: Maintain a gross cash capital expenditure rate of 3% of net sales.
- Earnings Growth: Achieve high-single-digit CAGR in underlying earnings per share compared to 2024.
- Cash Flow: Generate €9 billion in post-tax free cash flow.
- Shareholder Returns: Plan for €1 billion in annual share buybacks** and consistent dividend increases within the payout corridor**.
- Revenue Diversification: Grow complementary income streams to around €3 billion by 2028.
- Own Brand Sales: Increase Own Brand share to 45% of total store sales and enhance price perception through effective assortments and promotions.
- Omnichannel Loyalty: Achieve over 80% loyalty sales penetration and target 30 million monthly active users by 2028.
- Sustainability: Progress on reducing scope 1, 2, and 3 emissions.
- Inclusive Workforce: Strive for a workforce that is 100% gender balanced, reflective of communities, and inclusive.
Zaandam, the Netherlands, May 23, 2024 – Ahold Delhaize announced its “Growing Together” strategy at its 2024 Strategy Day, detailing its plans and ambitions through 2028. This plan aligns with Ahold Delhaize’s vision to be the trusted local food retailer, emphasizing vibrant customer experiences and trusted products.
Frans Muller, President and CEO of Ahold Delhaize: “Our strategy balances the needs of customers, employees, and society. ‘Growing Together’ keeps us at the forefront of innovation in healthy foods, omnichannel experiences, and supply chain transformation. We’re committed to realizing our growth potential by focusing on our strengths, investing in our people, and leveraging technology.”
Growth Model Focused on Six Strategic Priorities:
- Winning with Customers:
- Transform loyalty programs to digital-first, aiming for 30 million monthly active users by 2028.
- Increase Own Brand share to 45% of total sales and enhance price perception.
- Market Expansion:
- Accelerate store growth in the U.S., especially for Food Lion and Hannaford.
- Strengthen positions in Europe, particularly in the Benelux and CSE regions.
- Innovation for Growth and Efficiency:
- Grow complementary income streams to €3 billion by 2028.
- Leverage data, retail media, and partnerships for strategic capabilities.
- Cost Management:
- Achieve €5 billion in savings from 2025-2028 through efficiency and cost discipline.
Jolanda Poots-Bijl, CFO of Ahold Delhaize: “Our growth plan leverages our company’s strengths to create sustainable value and deliver predictable returns. We focus on operational efficiency to drive growth through our brands’ customer value propositions, digital solutions, and sustainability goals.”
JJ Fleeman, CEO of Ahold Delhaize USA: “We will strengthen our market position and improve customer value through targeted remodels, new stores, price investments, and enhanced customer experiences. Our brands are well-positioned to lead in the grocery industry for years to come.”
Wouter Kolk, CEO of Ahold Delhaize Europe & Indonesia: “We connect with our customers through local presence and clear purpose. By leveraging our scale, strengthening e-commerce leadership, exploring new revenue streams, and deepening customer engagement, we are on a clear path to strong growth.”
Natalia Wallenberg, CHRO: “Our new purpose, ‘Inspiring everyone to eat and live better,’ reflects our commitment to making a positive impact. Our ambition is to be the most local, future-proof, and inclusive grocery retailer.”
Ben Wishart, CTO: “Serving 63 million customers weekly, our vision is to be your local trusted retailer. We will continue investing in technology and AI to enhance business performance and sustainability, securing long-term customer trust.”
Live Strategy Day Broadcast:
The “Growing Together” strategy launch event will be broadcast at 2 pm CEST via www.aholddelhaize.com, featuring presentations from key leaders.
Assumptions for 2025:
Ambitions depend on the successful completion of the Profi acquisition and potential portfolio changes in the U.S.
Shareholder Returns:
Commitment to share buyback and dividend policies remains, with possible adjustments due to macro-economic or geopolitical changes or corporate events.
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