Our highlights of 2022
Group highlights
Reusable bags
Ditching free plastic bags in the produce aisle
Nourishing communities
Albert becomes the largest Czech food donor – and then raises the bar
Going electric
Transitioning to electric delivery is helping Giant Food reach its sustainability goals
Local service
Volunteering in local communities creates a sense of belonging
Local solutions
Supporting customer purchasing power while reducing food waste
Double capacity
Bol.com plans for growth by expanding its fulfilment center
Halving waste
Alfa Beta is committed to reducing food waste by 50% by 2025. This requires educating key stakeholders along the way
"We have great teams and the right knowledge and expertise to face whatever comes next."
Our brands and performance
414,000
Associates worldwide (1)
60 million
Customers served every week, both in stores and online
19
Great local consumer-facing brands (2)
7,659
Stores serving our local communities in Europe and the United States (3)
Including our joint venture brands.
Excluding our joint venture brands' stores.
Net sales for the financial year ending on January 1, 2023, were €86,984 million, an increase of €11,383 million, or 15.1%, compared to net sales of €75,601 million for the financial year ending on January 2, 2022. At constant exchange rates, net sales were up by €5,594 million or 6.9%.
Gasoline sales increased by 48.1% in 2022 to €1,334 million. At constant exchange rates, gasoline sales increased by 31.4%, driven by the ongoing war in Ukraine leading to a considerable increase in gasoline prices worldwide in 2022.
Net sales excluding gasoline increased in 2022 by €10,950 million, or 14.7%, compared to 2021. At constant exchanges rates, net sales excluding gasoline increased in 2022 by €5,276 million, or 6.6%, compared to 2021. Sales growth was mainly driven by inflation, which accelerated shelf prices in our brands’ stores, foreign currency translation benefits and a slight benefit from the 2021 acquisition of 38 DEEN stores in the Netherlands.
In 2022, we continued to deliver strong net consumer online sales, which amounted to €11,323 million and increased by 4.9% at constant exchange rates. Online sales growth contributed €8,618 million to net sales (2021: €7,704 million).
Our local brands facilitated many initiatives that enabled this growth. Some of our U.S. brands reduced the minimum-order value and service and delivery fees and others added new Instacart geographies. Furthermore, the brands added 160 pick-up locations at stores while reducing lead times. In addition, geofencing was rolled out to more than 650 stores, reducing wait times by an average of 24%.
We continued to source more green energy through power purchase agreements (PPAs) in 2022. A total of 24% of the energy consumed came from renewable sources compared to 22% in 2021.
During 2022, we further increased the sale of healthy own-brand products as a proportion of total own-brand food sales to 54.4%. This increase resulted from the continuous efforts by our European brands to reformulate and expand their own-brand product ranges.
In addition, our brands continued to find innovative ways to reduce food waste by giving customers access to fresh produce, meat, dairy, bakery and other items nearing their best-by date at discounts up to 50% off. For example, in the U.S., the brands partnered with Flashfood, an app customers can use to check the availability of fresh food nearing its expiration date. The mobile app helps regular shoppers save over $500 a year on their grocery bills and stops these products from going to waste.
Operating income in 2022 went up by €448 million, or 13.5%, to €3,768 million compared to €3,320 million in 2021. The increase of €448 million is mainly explained by the changes in gross profit and operating expenses, as explained above. At constant exchange rates, operating income was up €174 million, or 4.9%.
Underlying operating income was €3,728 million in 2022, up €397 million, or 11.9%, versus €3,331 million in 2021. The contribution by segment was 70% by the U.S. and 30% by Europe, respectively. Underlying operating income margin in 2022 was 4.3%, compared to 4.4% in 2021. At constant exchange rates, underlying operating income increased by €127 million, or 3.5%, compared to 2021. Our 2022 results were mainly driven by intensified efforts by our brands to deliver customers great value through our Save for Our Customers cost savings program, which yielded 15% more savings than originally expected in 2022, despite the challenging market environment. These savings offset higher labor, distribution and energy costs.
Tight cost management remains a core objective of our business model. Our Save for Our Customers program delivered €979 million in 2022, positively impacting our gross profit and operating expenses. Through this program, our great local brands absorb cost increases to invest in better customer propositions and to keep shelf prices as low as possible, enabling customers to manage their shopping baskets efficiently and ensuring access to affordable and healthy food options in this inflationary environment.
For more information, see the performance review section of the Annual Report 2022.
Net sales in 2022 were €31,767 million, up by €1,620 million or 5.4% compared to 2021. At constant exchange rates, net sales were up by 5.0%. Sales growth was driven by high price inflation, in particular in the second half of the year and by the acquisition of 38 DEEN stores in the Netherlands with incremental sales contribution up to Q4 2022. With high levels of inflation, our brands were focused on helping customers efficiently manage their spending. Our cost reduction programs also helped the local brands to absorb cost increases relating to energy, transport and labor, enabling us to keep prices as low as possible.
Net consumer online sales were €7,166 million, down by (0.1)% compared to last year, mainly driven by non-food e-commerce. With COVID-19 restrictions being lifted, the overall e-commerce market in Europe declined. Within these market conditions, the first half of 2022 was characterized by lower year-over-year results. However, bol.com was able to limit sales decline by (1.8)% in 2022 after growing 26.6% last year. In addition, the brand was able to increase its market share in a declining market. Its third-party platform, which currently offers a marketplace to more than 50,000 Plaza partners, remains an important growth driver for bol.com. The European brands’ robust online grocery offering continued to serve consumers well, with sales largely compensating for the loss in non-food.
In 2022, underlying operating income in Europe was €1,131 million, down by €175 million, or 13.4%, compared to 2021. Underlying operating margin was 3.6% in 2022, down 0.8 percentage points compared to 2021. Margins in Europe were severely affected by rising energy and utility costs and a challenging economic environment. Other cost escalations and volume deleveraging added additional pressure, and an increased cost of product combined with higher operating expenses diluted margins further. Savings from our brands’ Save for Our Customers programs helped to mitigate this impact.
The European brands’ net sales consist of sales to consumers and to franchise stores. Franchise stores operate under the same format as Ahold Delhaize-operated stores. Franchisees purchase merchandise primarily from Ahold Delhaize, pay a franchise fee and receive support services.
For more information, see the performance review section of the Annual Report 2022.
In 2022, net sales were €55,218 million, up by €9,763 million or 21.5% compared to 2021. At constant exchange rates, net sales were up by 7.9%. Sales growth was positively impacted by inflation, 104 store remodels in 2022 (mainly in Stop & Shop and Food Lion), the acquisition of 71 stores from Southeastern Grocers in 2021 and online channel acceleration.
Online sales were €4,157 million, up by 14.5% compared to the prior year at constant exchange rates. The increase versus last year was primarily driven by the development of our channels: the addition of 162 pick-up locations, annualized sales for 272 pick-from-store locations opened in 2021, and the expansion of e-commerce offerings across the U.S. brands.
In 2022, underlying operating income was €2,603 million, up by €453 million or 21.1% compared to last year. At constant exchange rates, underlying operating income increased by 7.2%.
The United States’ underlying operating margin in 2022 was 4.7%, the same as in 2021. The 2022 sales were positively affected by inflation. Inflationary pressures in both product cost and operating expenses, related to supply chain, such as fuel, labor challenges and the labor market, as well as energy costs, created pressure on our margins and operating income in the U.S.
For more information, see the performance review section of the Annual Report 2022.
Our growth drivers
Our Leading Together strategy provides a solid framework as we continue to evolve our business model to serve customers' omnichannel shopping journeys and achieve strong results.
Drive omnichannel growth
Customers take a journey with our brands every day, interacting at many touchpoints during their busy lives. Our brands work to make this journey as seamless and convenient as possible through our omnichannel offering of interconnected online and offline channels. We’ve found that this is the shopping experience our customers prefer because it enables them to shop on their terms: when and how they want.
Our omnichannel offering gives our brands lots of ways to help customers navigate the choices they encounter, from planning to shopping to enjoying their meals, and fulfill our purpose of helping people eat well, save time and live better.
Elevate healthy and sustainable
Our “Grounded in Goodness” strategy is centered around our belief that what is healthy and sustainable should be accessible and available to all. With a dual focus on healthier people and a healthier planet, our strategy is based on the idea that these two things are intrinsically linked. We believe that if we get it right for ourselves, we usually also get it right for the planet. And acting responsibly today is imperative to securing a better tomorrow for generations to come.
This approach ensures the decisions we make are grounded in doing the right thing for people – with a focus on customers, products, communities and associates – and planet – with a focus on impacts from our own operations and working with farmers and suppliers to reduce our impacts across the entire supply chain.
We collaborate closely with our partners and brands to empower customers to join this journey and make healthy and sustainable choices into easy choices for everyone. Our brands aim to ensure that what’s healthy and sustainable is affordable, accessible and inclusive for all through their marketing, reward programs and store design. They innovate to make products healthier, more interesting and more varied. The brands aim to source locally, help farmers get a fair deal and work to improve the food supply chain. Along the way, we are transparent in highlighting our progress and making better choices clear.
Cultivate best talent
Our brands are driven by committed people – the 414 thousand-strong team making a daily difference to customers and communities. We are united in our shared values of care, courage, integrity, teamwork and humor and are passionate about creating healthy, engaged and inclusive workplaces reflective of the communities our brands serve.
Our promise is that we will provide a caring place to work where they feel welcome and everyone is heard, valued and finds purpose in their work – because we know that when our associates grow, our business succeeds.
Our motto “Dare to care” sums up what makes us special: always having the courage to care for associates, customers and communities as we fulfil our purpose to help people eat well, save time and live better.
We aspire to a workforce that is 100% gender balanced, 100% reflective of our markets and 100% inclusive.
Strengthen operational excellence
We support our omnichannel growth ambitions by saving for our customers, improving our supply chain, enhancing store operations, strengthening internal operations across all functions and leaving no stone unturned as we leverage our scale in sourcing.
Our local brands are outstanding operators that have been running retail businesses for many decades – this gives them the ability to maintain a steady performance even as market circumstances become more challenging. They are always working to improve how they operate stores, distribution centers and home delivery and pick-up operations.
Our strong operating model is integral to their success: our network of leading local brands supported by service companies that operate at scale and leverage their best capabilities regionally and globally. It gives us a competitive advantage and is key to how we bring our omnichannel customer value proposition to life.
Our operating model enables us to transform quickly and use our scale in a way that balances with the brands’ need to consistently meet the unique demands of customers in their local markets. We believe it provides a repeatable formula for growth in the U.S., Europe and Indonesia.
Our business model
Across Ahold Delhaize, each of our great local brands works hard to save for customers, drive same-store sales and fund growth. Our impact goes beyond what happens in stores and distribution centers: from farming to consumption, our brands work with suppliers and partners to make the value chain more sustainable and provide customers with more of the meals they enjoy each day, and healthier choices to help them live better. We have recently committed to reaching net-zero carbon emissions across our own operations by 2040 and to becoming a net-zero business across our entire supply chain, products and services by 2050.
Our brands source products and raw materials from producers near and far, and partner across the industry to create a more sustainable value chain.
While our brands sell a wide range of products in store and online, own-brand products, in particular, help them offer great value across different price points and a relevant local assortment, while having greater control over product quality.
Products are delivered to our brands’ DCs and prepared for transport to stores, dark stores, pick-up points and customers’ homes. We are adapting our supply chain to better serve customers and contribute to a healthier planet.
Our well-known local brands, supported by more than 414,000 associates, serve over 60 million customers each week, providing a leading local food shopping experience in stores and online.
Our goal is to empower customers to make better choices and join us in creating a better world by helping them understand the impact of their shopping decisions on the planet and themselves.
Environmental, Social & Governance
ESG performance is an important part of how we measure success at Ahold Delhaize. We have a long history of reporting on our ESG performance and we are pleased to see our stakeholders’ interest in this area continuing to increase.
2022 As part of our strategy to support a healthier planet, and informed by our materiality assessment, we measure and manage our company’s environmental impacts relating to carbon emissions and climate change, food waste, sustainable packaging and sustainable agriculture.
For more information, see the ESG section of the Annual Report 2022.
As we work to build a healthier planet, we also focus on healthier people as part of our Grounded in Goodness strategy.
We see a continuing shift in all our markets towards health, well-being and sustainability. Consumers want to eat healthier, but also more sustainably – and are looking to retailers to help them access products that are both healthy, nutritional and affordable.
Healthy food leads to healthy communities by reducing the risk of chronic diseases and contributing to a community’s overall resilience and vitality. Customers look to our brands for fresh, healthy inspiration to help them put delicious, nutritious family meals on the table every day. Our brands work to help make customers (and associates) more aware of what they eat and how it impacts their health. They offer affordable nutritious product choices and other information and support to make healthier eating easier and more appealing.
For more information, see the ESG section of the Annual Report 2022.
As in every other area of our business, we believe that having the right governance in place to ensure we take a structured and effective approach to our ESG ambitions is critical to our success.
We have bold aspirations to become a more diverse, equitable and inclusive company, across all our brands and businesses. Our Global DE&I strategy includes three pillars critical to advancing this work: our people, our culture, and our communities.
For more information, see the ESG section of the Annual Report 2022.
Leading Together
