Dutch retail group Ahold Delhaize has had a very strong end to 2021, despite rising costs. This year, the group wants to focus on digitisation, and will double its investments in online platform bol.com.
Seize opportunities
Ahold Delhaize was able to establish growth in 2021, despite a record-high base of comparison in Covid-year 2020: a stronger than expected fourth quarter pushed annual sales up 3.3 % to 75.6 billion euros. The group managed to maintain an excellent operational margin of 4.4 %, despite logistical challenges and rising pressure from inflation. Once again, e-commerce has proved to be an important factor in this success: online sales grew by a third compared to last year’s record, and even doubled compared to two years ago.
Next year, CEO Frans Muller wants to speed up omnichannel investments in order to seize the growth opportunities the ‘new normal’ has created: “This will be particularly visible at bol.com, where we will more than double investments in 2022 as we begin a phase of significant investment in the brand.” The online platform’s turnover went up 21 % to 2.8 billion euros, while underlying EBITDA was 166 million euros. Ahold Delhaize sticks to its intention to float bol.com on the stock exchange in the second half of the year.
Albert Heijn shines
In the Benelux, Ahold Delhaize gained market share in the fourth quarter. “Delhaize‘s market share remained stable around 25 percent over the whole year,” Muller told business newspaper De Tijd. Albert Heijn, the group’s supermarket chain in Belgium and the Netherlands, performed particularly strongly – part of its growth did however come from the rebranding of 38 Deen– supermarkets the chain acquired earlier. This did also allow Albert Heijn to raise its market share in the Netherlands again. This year, the food retailer will focus on convenience, opening more AH to Go shops and stores at gas stations. Moreover, it will continue to boost its online subscription service Albert Heijn Premium, which already has over 300,000 subscribers.
For 2022, Ahold Delhaize counts on a continued growth in sales, despite the difficult market situation. The retailer thinks that the changing consumer behaviour is fitting well with the group’s business model: as more people continue to cook and eat at home, they also order ever more frequently online. The Dutch group expects its operational margin to remain slightly above the 4 % mark, despite a slight pressure on margins. The retailer will raise prices where necessary, says top executive Muller: “Price increases that we can understand and that we think are real, we think customers will understand”, he tells RTL Nieuws. He does expect inflation to fall in the second half of the year.
One remarkable figure to end with: last year, Ahold Delhaize spent an astonishing 364 million euros on Covid measures – that is a million euros each day.
