Transcript Agenda item 2

Annual General Meeting of Shareholders
April 19, 2016
Jan Hommen
Chairman Supervisory Board
Agenda item 1 / Agendapunt 1
 Opening
Agenda items 2 – 6 / Agendapunten 2 – 6
 Agenda item 2: Report of the management board for the financial year 2015
 Agenda item 3: Explanation of policy on additions to reserves and dividends
 Agenda item 4: Explanation of the implementation of the Management Board remuneration policy
 Agenda item 5: Proposal to adopt the 2015 financial statements
 Agenda item 6: Proposal to determine the dividend over financial year 2015
 Agendapunt 2: Verslag van de Raad van Bestuur over het boekjaar 2015
 Agendapunt 3: Toelichting op het reserverings- en dividendbeleid
 Agendapunt 4: Toelichting op de uitvoering van het bezoldigingsbeleid van de Raad van Bestuur
 Agendapunt 5: Voorstel tot vaststelling van de jaarrekening over het boekjaar 2015
 Agendapunt 6: Voorstel tot vaststelling dividend over het boekjaar 2015
Dick Boer
President and Chief Executive Officer
Looking back at our journey forward
Pioneering with supermarket format
Pioneering with supermarket format
On track to reach our 2017 online ambition
Ahold as a listed company
Responsible Retailing
Expanding healthy options
Strong organic own brands
936,000 children educated in healthy living programs
Long-standing relationships with suppliers
Jeroen – Albert Heijn’s cucumber supplier for 41 years
236,000 proud associates
Strong results in 2015
U.S.: good progress with price, quality investments
Netherlands: sales momentum remained strong
Czech: succesful roll-out new operating model
2015 consumer online sales: €1.8 billion
Strong free cash flow allows us to invest
We continue to build on our strong, local brands
Bringing together two complementary businesses
Common values and strong, trusted local brands
Net Sales*
€38.2bn
Employees worldwide*
236,000
Net Sales*
€24.4bn
Stores worldwide
Stores worldwide
3,253
3,512
*Note: Sales, Stores and Employees 2015 excludes JVs i.e. JMR for Ahold in Portugal and Super Indo for Delhaize in Indonesia
Employees worldwide*
154,000
Wrap-up
Jeff Carr
Chief Financial Officer
Total sales performance
(in millions of euro’s)
Full year
change
change
actual rates
constant rates
16.6%
4.3%
Sales growth adjusted for 53rd week
14.2%
2.3%
Sales growth excl gas adjusted for 53rd week
15.6%
3.8%
Sales
2015
2014
38,203
32,774
Operating performance
(in millions of euro’s)
Full year
change
change
actual rates
constant rates
32,774
16.6%
4.3%
27.1%
26.5%
0.6
0.3
Underlying operating
income
1,461
1,267
15.3%
3.6%
Underlying operating
margin
3.8%
3.9%
(0.1)
(0.1)
2015
2014
Sales
38,203
Gross profit margin
 Sales growth driven by
investments in our customer
proposition funded by our
Simplicity program
 Gross margin improvement
supported by lower gas prices
 Underlying margin slightly affected
by higher pension costs and
additional online investments,
offset by favorable commodity
prices and gas sales effects
Underlying operating income by segment
(in millions of euro’s)
Ahold USA
2015
Sales
Underlying
operating income
Underlying
operating margin
23,732
940
4.0%
change
constant rates
1.4%
6.4%
0.2
The Netherlands
Czech Republic
2015
change
2015
12,699
8.6%
1,772
578
4.6%
0.7%
(0.3)
27
1.5%
change
constant rates
15.3%
42.3%
0.3
 Balanced investments in customer
proposition and Simplicity savings
in the U.S.
 Lower margins in the Netherlands
from additional pension costs and
online investments
 Margin in Czech Republic
stabilizing towards pre-acquisition
levels
Income from continuing operations
(in millions of euro’s)
Full year
change
2015
2014
1,461
1,267
(143)
(17)
1,318
1,250
5.4%
(265)
(224)
20
(235)
(248)
24
(12.8%)
9.7%
(16.7%)
849
791
7.3%
Basic EPS from continuing operations
€1.04
€0.90
15.6%
Dividend per share
€0.52*
€0.48
8.3%
49%
51%
Underlying operating income
Restructuring and related charges, other
Operating income
Net financial expenses
Income taxes
Share in income (loss) of joint ventures
Income from continuing operations
Dividend payout %**
* Subject to shareholder approval
** Based on adjusted income from continuing operations
actual rates
15.3%
Dividend
Dividend 2015

€0.52 per common share
Timetable

April 21, 2016*
Ex-dividend date for common shares

April 22, 2016
Dividend record date

May 4, 2016
Payment date
• April 20, 2016 for ADR’s (American Depositary Receipts)
Free cash flow and uses of cash
(in millions of euro’s)
Strong free cash flow
Balanced approach to capital allocation
Operating cash flow*
2,139
Cash capex
(804)
Disposals
1,051
2012
1,109
1,184
1,055
2013
* Operating cash flow from continuing operations
** Before impact of exchange rates
2014
2015
33
51
Other
(202)
Free cash flow
1,184
Acquisitions / divestments
(150)
Dividend
(396)
Share buyback
(161)
Other cash changes
(404)
Change in cash and cash equivalents**
73
Uses of cash
(in millions of euro’s)
Attractive shareholder returns over
€5 billion in the last 4 years
Disciplined capital expenditure
929
2,500
830
0.
0.52
804
732
701
2,000
1,008
0.
0.40
0.
1,500
414
0.
1,000
190
150500
9
0
2012
2013
Capital expenditures (cash)
* Expected
2014
2015
Acquisitions (cash)
457
415
1,000
396
768
277
2012
0.
1,232
0.
430
161
2013
2014
2015
0
2016*
Share buyback
Dividend
Capital repayment
Dividend per share
Capital structure
(in billions of euro’s)
Increase in cash, reduction of net debt
Lease adjusted leverage decreased
4.0
2.4
1.9
1.9
-0.9
3.0
3.2
2012
1.1
1.3
1.4
3.2
2013
Gross debt
* Includes cash and short-term deposits
3.5
2014
Cash
Net debt
2015

Cash balances* up €0.5 billion to €2.4 billion

€161 million share buyback completed in
2015. Program stopped after merger
announcement

Deleverage of net lease-adjusted debt /
EBITDAR at 1.7 times
Outlook 2016

Underlying operating margins in 2016 expected to trend in line with full year 2015, excluding the potential
impact from the intended merger with Delhaize

Ongoing Simplicity cost saving and efficiency program, expected to deliver €350 million in 2016. This
target is incremental to synergy targets related to the intended merger

Online businesses well on track to meet 2017 target of €2.5 billion net consumer sales

Additional logistical investments planned in the Netherlands, resulting in increased cash capex for 2016
of around €1 billion
Rob van den Bergh
Chairman Remuneration Committee Supervisory Board
Explanation of the implementation of the
remuneration policy of the Management Board
Performance year
Annual cash incentive plan
2015
Payout as % of target
135%
Performance year
2014
45%
2013
89%
2012
55%
2011
101%
Performance measures
Net sales growth (30%)
Operating margin (30%)
Operating cash flow (30%)
Responsible Retailing (10%)
Year of vesting
Year of vesting
Long-term equity-based program
2016
2015
2014
2013
2012
Shares granted in 2011 (5 year plan)
Payout based on TSR performance
110%
90%
130%
110%
110%
Shares granted in 2013 (3 year plan)
Payout based on TSR performance
Payout based on RoC performance
Conditional Shares
100%
60%
100%
90%
130%
110%
110%
Jan Hommen
Chairman Supervisory Board
Cautionary notice
These presentations contain forward-looking statements, which do not refer to historical facts but refer to expectations based on management’s current views and assumptions and
involve known and unknown risks and uncertainties that could cause actual results, performance, or events to differ materially from those included in such statements. These
statements or disclosures may discuss goals, intentions and expectations as to future trends, plans, events, results of operations or financial condition, or state other information
relating to Ahold, based on current beliefs of management as well as assumptions made by, and information currently available to, management. Forward-looking statements
generally will be accompanied by words such as “anticipate,” “believe,” “plan,” “could,” “estimate,” “expect,” “forecast,” “guidance,” “intend,” “may,” “possible,” “potential,” “predict,”
“project” or other similar words, phrases or expressions.
These presentations contain Ahold forward-looking statements as to, amongst others, Ahold tackling major challenges in society as to, amongst others, health, food security,
diversity and responsible consumption, its Responsible Retailing Strategy, which covers, amongst others, organic products, sourcing, being a better neighbor, sourcing and people,
capital repayment, strong local brands, the intended merger between Ahold and Delhaize, dividend, Ahold’s simplicity program and operating efficiency and cost reductions,
reinvestments in Ahold’s business to reduce prices, to improve quality and to drive sales growth, reverse stock split, returns to Ahold’s shareholders and Ahold’s remuneration policy.
Many of the risks and uncertainties relate to factors that are beyond Ahold’s control. Therefore, investors and shareholders should not place undue reliance on such statements,
which include but are not limited to Factors that could cause actual results to differ materially from those in the forward-looking statements include, but are not limited to: the
occurrence of any change, event or development that could give rise to the termination of the merger agreement; the risk that the necessary regulatory approvals may not be
obtained or may be obtained subject to conditions that are not anticipated; failure to satisfy other closing conditions with respect to the transaction on the proposed terms and
timeframe; the possibility that the transaction does not close when expected or at all; the risks that the new businesses will not be integrated successfully or promptly or that the
combined company will not realize the expected benefits from the transaction; Ahold’s ability to successfully implement and complete its plans and strategies and to meet its targets;
risks related to disruption of management time from ongoing business operations due to the proposed transaction; the benefits from Ahold’s plans and strategies being less than
anticipated; the effect of the announcement or completion of the proposed transaction on the ability of Ahold to retain customers and retain and hire key personnel, maintain
relationships with suppliers, and on their operating results and businesses generally; litigation relating to the transaction; the effect of general economic or political conditions; Ahold’s
ability to retain and attract employees who are integral to the success of the business; business and IT continuity, collective bargaining, distinctiveness, competitive advantage and
economic conditions; information security, legislative and regulatory environment and litigation risks; and product safety, pension plan funding, strategic projects, responsible retailing,
insurance and unforeseen tax liabilities.
The foregoing list of factors is not exhaustive. Forward-looking statements speak only as of the date they are made. Ahold does not assume any obligation to update any public
information or forward-looking statement in these presentations to reflect events or circumstances after the date of these presentations, except as may be required by applicable
laws.
Outside the Netherlands, Koninklijke Ahold N.V., being its registered name, presents itself under the name of "Royal Ahold" or simply "Ahold."
Agenda items 2 – 6 / Agendapunten 2 – 6
 Agenda item 2: Report of the management board for the financial year 2015
 Agenda item 3: Explanation of policy on additions to reserves and dividends
 Agenda item 4: Explanation of the implementation of the Management Board remuneration policy
 Agenda item 5: Proposal to adopt the 2015 financial statements
 Agenda item 6: Proposal to determine the dividend over financial year 2015
 Agendapunt 2: Verslag van de Raad van Bestuur over het boekjaar 2015
 Agendapunt 3: Toelichting op het reserverings- en dividendbeleid
 Agendapunt 4: Toelichting op de uitvoering van het bezoldigingsbeleid van de Raad van Bestuur
 Agendapunt 5: Voorstel tot vaststelling van de jaarrekening over het boekjaar 2015
 Agendapunt 6: Voorstel tot vaststelling dividend over het boekjaar 2015
Questions and Answers
Voting procedure / Stemprocedure
 Register your vote by pressing 1, 2 or 3
 Om te stemmen, druk 1, 2 of 3
1 = for / voor
2 = against / tegen
3 = abstention / onthouding
 Correction / Correctie
 Make your choice again. Your last choice will be registered.
 Maak opnieuw uw keuze. Uw laatste keuze geldt.
Agenda item 5 / Agendapunt 5
 Proposal to adopt the 2015 financial statements
 Voorstel tot vaststelling van de jaarrekening over het boekjaar 2015
Agenda item 6 / Agendapunt 6
 Proposal to determine the dividend over financial year 2015
 Voorstel tot vaststelling dividend over het boekjaar 2015
Agenda item 7 / Agendapunt 7
 Proposal for discharge of liabilities of the members of the Management Board
 Voorstel tot het verlenen van décharge aan de leden van de Raad van Bestuur
Agenda item 8 / Agendapunt 8
 Proposal for discharge of liabilities of the members of the Supervisory Board
 Voorstel tot het verlenen van décharge aan de leden van de Raad van Commissarissen
Agenda item 9 / Agendapunt 9
 Proposal to amend the Remuneration Policy of the Management Board
 Voorstel tot wijziging van het bezoldigingsbeleid van de Raad van Bestuur
Rob van den Bergh
Chairman Remuneration Committee Supervisory Board
Proposal to amend the Remuneration Policy of the
Management Board
Reference market

Peer Group
A new reference market has been established following the
remuneration policy review scheduled for 2015 and in light of
the upcoming merger
US Peers
Kroger
Costco
Target
Walgreens B.A.
Best Buy Co
Staples
 The new global reference market combines perspectives
from both cross-industry and sector specific companies in
the three most relevant geographies
EU Peers
Tesco
Carrefour
Metro
Casino Guichard P.
J Sainsbury
WM Morrison
Positioning Ahold Delhaize:
52% (average)
Global Reference
AEX Blend
Unilever
Philips
Heineken
Randstad
Akzo Nobel
Relx
 Ahold Delhaize positions in the middle of the group in
terms of size and scope
Total Revenue
61%
Market Capitalization
50%
Total Assets
44%
Employees
83%
Salaries
Ahold Delhaize

The proposed remuneration policy results in limited
increases in overall at target pay packages
 Base salaries increased with 1.75%
 LTI increased with 15%-pts (25%-pts for CFO)
Amounts in
thousands
Base
Change
STI at target
LTI at target
Total
Direct
CEO
€ 1,017
100%
€ 1,017
235%
€ 2,390 € 4,424
5.4%
CFO
€ 678
100%
€ 678
175%
€ 1,187 € 2,543
9.0%
COO USA (McCann)
€ 678
100%
€ 678
200%
€ 1,356 € 2,712
5.7%
€ 1,007
100%
€ 1,007
200%
€ 2,015 € 4,029
$763
100%
$763
200%
€ 641
100%
€ 641
150%
Deputy CEO
COO USA (Holt)
COO Europe
$1,526
$3,053
€ 962 € 2,244
Proposal to amend the Remuneration Policy of the
Management Board
Incentives

Short-Term Incentives
Metrics
Financial and Individual Key Performance Indicators in the
Short-Term Incentive
10%
30%
30%


Long-term Incentive fully subject to forward looking
performance criteria
Operating Margin
30%
Operating Cash Flow
Individual KPIs
Increased importance of sustainability
 More weight
 Moved into long-term incentive
Long-Term Incentives
Performance shares
20%

Sales Growth
Balanced TSR performance peer group
 7 US companies and 7 European companies (including
Ahold Delhaize)
 Pay-out range adapted to reflect larger TSR peer group
40%
Metrics
Sustainability
Return on Capital
40%
Total Shareholder
Return
Jan Hommen
Chairman Supervisory Board
Agenda item 9 / Agendapunt 9
 Proposal to amend the Remuneration Policy of the Management Board
 Voorstel tot wijziging van het bezoldigingsbeleid van de Raad van Bestuur
Agenda item 10 / Agendapunt 10
 Proposal to appoint PricewaterhouseCoopers Accountants N.V. as external auditor for financial
year 2016
 Voorstel tot benoeming van PricewaterhouseCoopers Accountants N.V. als externe accountant
voor het boekjaar 2016
Agenda item 11 / Agendapunt 11
 Authorization to issue shares
 Aanwijzing tot uitgifte van aandelen
Agenda item 12 / Agendapunt 12
 Authorization to restrict or exclude pre-emptive rights
 Aanwijzing tot het beperken of uitsluiten van voorkeursrechten
Agenda item 13 / Agendapunt 13
 Authorization to acquire shares
 Machtiging tot inkoop van eigen aandelen
Agenda item 14 / Agendapunt 14
 Cancellation of common shares
 Intrekking van gewone aandelen
Agenda item 15 / Agendapunt 15
 Closing
 Sluiting
Questions and Answers
Thank you