Q1 2025 Koninklijke Ahold Delhaize NV Earnings Call
Elections and forward looking statements all statements other than statements of historical facts may be forward looking statements forward looking statements are subject to risks.
Uncertainties and other factors that are difficult to predict and that may cause our actual results to differ materially from future results.
Implied by such forward looking statements. Therefore, you should not place undue reliance on any of these forward looking statements. The introduction will be followed by a Q&A session any views expressed by those asking questions on not necessarily the views of all of that has a.
JP: At this time I would like to hand, the call over to J P. M. Ara Senior Vice President head of Investor Relations. Please go ahead JP.
J.P.M. Ara: Alright, Thank you very much Karen and good morning, everyone.
JP: I'm delighted to welcome you all to our 2024 results conference call.
JP: On today's call are friends motor, our President and CEO, Andrew Alliance reports filed our CFO. After a brief presentation, we will open the call for questions.
JP: In case, you haven't seen it the earnings release and the accompanying presentation slides can be accessed through the investors section of our website today's dot com.
JP: These are to provide extra disclosures.
JP: For your convenience.
JP: To ensure everyone has the opportunity to get their questions answered today I ask that you initially limit yourself to two questions. That's two questions not five prior questions and if you have further questions and feel free to reenter the queue.
JP: Sure.
JP: All growth rates mentioned in today's prepared remarks.
JP: Exchange rates unless otherwise stated.
JP: Friends over to you.
J.P.: Thank you very much J J P and good morning, everyone.
Speaker Change: Reflecting on the year I'm proud of all that we've accomplished.
J.P.: If I were to choose three works to summarize.
Speaker Change: Commitment consistency.
Speaker Change: Clarity.
Speaker Change: Commitment is.
Speaker Change: Staying true to our values to deliver for our customers every day and consistency.
Two our plans realizing another year of strong underlying performance and.
Speaker Change: And clarity.
Speaker Change: On where we are heading as a company to our growing.
Speaker Change: Strategy.
Speaker Change: Commitment starts with our people.
Speaker Change: 2024 has been a dynamic.
Speaker Change: Disruptive year with a lot of to do lots of things to deal with.
Speaker Change: Inflation volatility in commodities and supply chain, social and political tensions and fast paced changes due to new technology.
Speaker Change: Work and how we live.
Speaker Change: Creating value for customers.
Speaker Change: Thanks to their local store.
Speaker Change: Specific needs continues to be a tangible differentiator for our business.
Speaker Change: And for this I would like to thank our passionate associates for living our values and their dedication to our performance driven.
Speaker Change: Moving to consistency. This for me means sticking to our promises in 2024, we set you could depend on us for <unk>.
Speaker Change: Hi, everybody.
Speaker Change: Focus on the customer.
Okay.
Speaker Change: And leveraging the strength of our great local brands.
Speaker Change: Continued advancement of our own brand strategies, increasing penetration.
Speaker Change: Deaths.
Speaker Change: It's fair to state bank for simplification and modernization of our organization.
Speaker Change: Sustained growth and as always continuing to be laser focused on cost control and cash flow to reinvest in our customers and our company.
Speaker Change: Looking at our scorecard, we were indeed consistent.
Speaker Change: Or exceeded all of our key goals for the year.
Speaker Change: At the same time, we also had the room to kickstart several growing together initiatives, which will pave towards 2025.
Speaker Change: And then finally clarity, which is ultimately the key to great execution.
Speaker Change: In May and June we crystallized, our game plan and ambitions for the coming four years building on our core strengths and looking with an open mind to the future.
Speaker Change: We are in them.
Speaker Change: Plan, where we want to grow faster than the industry, maintaining leading margins and deliver sustainable earnings growth.
Speaker Change: And I'm, particularly proud of how quickly our teams have stepped into our new strategy.
Speaker Change: With several actions already.
Speaker Change: Underway.
Speaker Change: Let me share a few highlights in this respect.
Speaker Change: The first area is investing in our winning CVP the customer.
Speaker Change: <unk>.
Speaker Change: We want our customers to have vibrant experiences every time, they interact with our brands whether in store or digitally or at the intersection of the two.
Speaker Change: To that end.
Speaker Change: We are elevating our digital solutions.
Speaker Change: Getting some secret sauce through AI and predictive analytics.
Speaker Change: And in the U S. Our brands delivered 12 billion personalized offers for the year.
Speaker Change: The $1 billion increase.
Speaker Change: With regards to 2023.
Speaker Change: And we also announced a new partnership with <unk>.
Speaker Change: Margins on digital coupons to further improve our types and savings.
Speaker Change: Okay.
Speaker Change: Greece, the modular ecommerce platform was launched.
Speaker Change: Final in a series of six launches across Europe.
Speaker Change: Market.
Speaker Change: At Alberta in the Czech Republic, the first Brent on the New F earlier monthly App users have increased by over 20% and loyalty sales have increased nearly 10% compared to 2023.
Speaker Change: In tandem with our digital experiences. We also have been working hard on our assortment throughout the year.
Speaker Change: Ensuring we offer the customer the freshest healthiest products on the market at great competitive prices.
Speaker Change: In this respect strengthening own Brent assortment is key and we have a big ambition.
Speaker Change: Thank you.
Speaker Change: <unk> penetration over time to 45%.
Speaker Change: Our Hain is a front runner in own brand execution and in 2020 for more than 150 owned brand products.
Speaker Change: Clients were award winning in consumer taste and quality elections.
Speaker Change: Our CSD brands made progress on the product amortization, bringing an additional 500 products both price value at assortment differentiators to the rich.
Speaker Change: These products also playing a vital role in increasing regional price favorites with all the CSD brands now having a minimum.
Speaker Change: 125 price favorites everyday assortment, which is an increase of 15% compared to 2020.
Speaker Change: Pete.
Speaker Change: In the U S. A major focus has been on raising the awareness of <unk>.
Speaker Change: Okay.
Speaker Change: Price relatively to national brands.
Speaker Change: And during the last quarter U S owned branch sales growth outpaced the rest of the store in both dollars and units.
Teachers to drive loyalty higher baskets, more traffic and increase healthy cells.
And for example included in these features are weekly personalized rewards and additional rewards for shopping Overshorten thresholds, 15% discount on our nature's promise own brand product line and the ability to earn credits on selected healthy products.
Speaker Change: Yeah.
Speaker Change: The second aspect I would like to highlight today is the progress we are making to densify and grow our markets.
Speaker Change: By prioritizing optimizing and sharpening our portfolio you will see a more pronounced a rigorous focus on growing customer reach.
Speaker Change: Extending leading positions in our most profitable markets.
Since the update our testing and doubling in customer engagement and in discounts redeemed.
Speaker Change: Yeah.
Speaker Change: During our strategy day in May JJ presented a clear view for the future potential of the U S brands in this respect.
It has helped contribute to a 7% points increase in loyalty sales penetration.
And as we strengthen our customer value proposition through our price investments enhancements to our loyalty programs and differentiation of our own brand portfolio. We are also able to grow our customer reach.
Speaker Change: One of them.
Speaker Change: The giant company, which is a regional presence local customer base and leading market positions, which is why I'm pleased about.
Speaker Change: The branch in Philadelphia in December with two additional stores in the works for 2025.
Which brings me to the next growth driver that I would like to spend some time on <unk>.
Speaker Change: Additionally, 95% and store fleet is now remodeled with the latest 40 zones.
<unk> and grow our markets.
Starting first with Prophage.
We are pleased to have completed our first quarter with profi integrated into our portfolio of brands.
Speaker Change: On the flip side.
Speaker Change: Sorry interventions when branch are challenged is an essential contributor to elevating the quality of our sales.
<unk> adds over 1700 supermarkets and convenience stores to our European footprint in the U S E region and will contribute over 3 billion euro to our sales throughout 2025.
Speaker Change: Successful completion of the Belgium future plan.
Speaker Change: Affiliation project and the closure of the identified underperforming stop and shop locations.
Speaker Change: Okay.
The acquisition solidifies, our ambition to reach the number one or number two position in the markets, where we operate it also sets the CSC region up for additional growth and provides opportunities to address synergies.
Speaker Change: Our company's ability to do so and with these projects behind US I will share next steps. The teams are focused on a little bit later.
Speaker Change: Next let's spend a moment on leveraging and lowering our cost base in an environment, where inflationary cost our concern for many of us.
So far the integration is going well.
Next to integrating this most recent acquisition into the family we are proceeding at a good pace to accelerate remodels and new store openings.
Speaker Change: Our brands remain proactive.
Speaker Change: Sure that essential items are affordable and within reach for every wallet size.
When the opportunities arise. This also includes improving our position in the market by relocating our replacing stores.
Speaker Change: This is fueled by our save for our customers program, where we are proud that we exceeded our plans generating overwhelmed.
With a replacement store, we recognized a benefit of a larger sales uplift than the stand that we model.
Speaker Change: 75 billion euros in cost savings in 2024.
Without growing the store count, but with paybacks ultra taking a short of time compared to opening a new store.
Speaker Change: In all ways and although we always can do better to things we can do.
Speaker Change: Really well in this respect our fact based negotiations through our should cost models and simplification, where we challenged ourselves to continuously improve and magnified best practices.
An example of this is a giant food, which opened a replacement store at the Salt Lake market place in Maryland.
The store is a testament to community partnership.
The store features premium offerings like full service meat and seafood departments, along with a coffee shop in a restaurant, creating a vibrant retail recreation hub that benefits local residents and businesses.
Speaker Change: Two good examples of simplification through collaborations from last year.
Speaker Change: For example in the U S. The team began streamlining the support brands into one of the less USA support organization supporting all of our five local brands in a consistent and cost efficient manner.
As part of our plan to revitalize stop and shop.
Communicated our intention to deploy a more efficient use of capital to complete the remaining store remodels.
Speaker Change: In the <unk> region. The brands have completed the first phase of a project to standardized.
Boeing forward Remodels are focused on making investments that will have the greatest impact on the in store shopping experience and this combined with enhancements to the customer value proposition.
Speaker Change: Allowing for optimized store execution.
Speaker Change: Additionally, commercial operations have been standardized across all the CZ breaths, including one centralized data supporting <unk>.
Under this way of working stoppage of completed four remodels during the quarter and recently celebrated dray model of Framingham, Massachusetts location.
Speaker Change: Consistent training across by Us and aligned calendars for negotiations.
Speaker Change: This will.
For intermodal produce and bakery departments, Xbox with prepared foods and over 800, new products, including additional multicultural assortments.
Speaker Change: Opportunities for coffee to leverage and to unlock synergies in the coming years.
Speaker Change: Finally, let me spend a moment on healthy communities and planet.
Moving to the next quarter drove our growth model identifying innovation solutions and leveraging the power of AI and data. Both are both critical components that enable us to innovate for growth and efficiency to drive our complementary income streams.
Speaker Change: While the environment, we operate in continues to evolve our role and commitment commitment to support healthy communities and planet is unchanged.
Speaker Change: These topics remain key for long term business resilience.
Speaker Change: Our competitive advantage and align very closely with our values.
Again, we have made good progress on this front during the quarter, which several initiatives. We believe can scale over time and here are just a few examples.
Speaker Change: Our brands continue to implement.
Speaker Change: To promote healthy affordable food.
Speaker Change: Sustainable business practices, reducing food waste and energy consumption and encourage diversity and inclusion in the workplace.
Retail media in the U S has partnered with in market intelligence to provide advanced in store advertising solutions for CPG partners.
Speaker Change: Reflecting our respecting the local communities in which we operate.
This collaboration aims to enhance customer engagement by utilizing creative strategies to reach shoppers at key moments in their shopping journey.
Speaker Change: One such example is obtained in the Netherlands, it's focus on healthy and sustainable products has contributed significantly to its growth in market share and customer loyalty.
In Marsh measurement tools.
CPG companies to assess the effectiveness of their investment in advertising.
Speaker Change: Their percentage of AUM around healthy food sales.
Bolt is piloting branded shelf 50 selected advertisers, allowing them to customize content branding and product selection.
Speaker Change: <unk> increased.
Speaker Change: 200 basis points in 2010, before while the organic range and plant based assortment.
Speaker Change: Brent.
This initial version aimed to gather insights on campaign performance and advertising interaction, which will guide the broader rollout of the feature in dismay.
Speaker Change: Tara are extremely popular.
Speaker Change: So in summary.
Speaker Change: 24 behind there are lots of positives to leverage and build upon in 2025.
Our hand recently introduced stain your smart helper in the kitchen, which gets a phase to the already existing my eight may obtain assistant.
Speaker Change: I will share a few of our plans for the year a little bit later, but now over to Yolanda to share her remarks and insights in our numbers.
Yolanda: Thank you, France, and good morning to everyone.
Stan makes it possible to naturally engage in conversation with moms and dads and children about all questions in the kitchen, and we will be given more functionality in the coming periods.
Speaker Change: Great. Thank you goodbye.
Vijay: Vijay is that we are coming.
Speaker Change: Thank you our estimate.
Speaker Change: Personal and digital connections, we have with them understanding their needs in real time is a powerful asset and combined with the agility and entrepreneurial spirit of our great local brands.
Healthy communities and planet is an important priority within our growing to get our strategy and we are committed to playing a role in the transition to a healthier and more sustainable food system.
Speaker Change: Through a steadying.
Speaker Change: She has strong <unk> brand strength.
Speaker Change: You can see we are doing the right things as customers choose to shop.
Every small change we implement makes a difference on the larger scale and I'm proud that we achieved several important milestones already in this year.
Speaker Change: Everyday.
Speaker Change: It sounds mentioned we are now.
East with how we ended the year strong holiday sales, thanks, Jay first of Assortments and shopping.
We successfully priced our third sustainability linked bond.
Speaker Change: Is that often estimates everything they needed to celebrate the season.
We published our second Green Bond impact report and the carbon disclosure project CDP, a prominent global benchmark on environmental issues recognized our <unk> progress in climate.
Speaker Change: On slide eight.
Speaker Change: We present, the key underlying numbers for the quarter and the full year two centers.
Speaker Change: Okay.
<unk>, our climate rating to a minus.
Speaker Change: Three 0.6% too.
We received validation of our scope three targets in line within one five degrees scenario from SB Ti.
Speaker Change: One 3 billion during the quarter and 0.9% to $89 4 billion euro during the full year.
That completes my review of our performance so far this year.
Speaker Change: So benefited from positive comparable sales ex gas and store openings.
I'm confident our brands are taking the right steps moving at the right pace and leveraging the strong foundation and scale of our business supporting our customers and drive a competitive advantage for our business along the way.
Speaker Change: Sales in the Netherlands.
Speaker Change: The closure of underperforming stop inshore locations and the divestment of fresh direct impacted net sales growth by $2, one and one seven percentage point for Q4 and full year respectively.
Yolanda: Now over to you Yolanda to talk more about the financials. Thank you Jonathan good morning to everyone.
Speaker Change: Online sales increased by five 8% in Q4.
Yolanda: Our performance in the first quarter highlights that we can deliver solid results in a volatile environment.
Speaker Change: Two 5% for the full year.
Speaker Change: Assessment of fresh Didact had a negative impact of five one percentage points.
Yolanda: These results are a reflection of how we are balancing our growth investments and cost saving strategies in the U S and 10 Europe.
Speaker Change: And six nine percentage points.
Speaker Change: Yeah.
Yolanda: As you know we have an ambitious growth plan, we want to grow faster than the industry, while maintaining leading margins and delivering sustainable earnings growth.
Speaker Change: Excluding fresh direct we saw double digit growth rate.
Speaker Change: Many of our brands, including all the time and food Lion.
Speaker Change: Underlying operating margin for the quarter was four 1%.
Yolanda: Our brands are well underway and the new strategy and we see a strong and positive response from customers for what we're doing.
Speaker Change: The decrease of 20 basis points. This is last year.
Yolanda: Net sales grew 5% to $23 3 billion year round.
Speaker Change: Thank you.
Speaker Change: No recurring items in the U S related to holiday approvals.
Yolanda: Closure of stop and shop stores, and the cessation of tobacco sales in the Netherlands, and Belgium negatively impacted net sales growth by one percentage points.
Speaker Change: Our full year underlying.
Speaker Change: <unk> margin for 2024 was 4.0%.
Speaker Change: Diluted.
Yolanda: And underlying operating margin was three 8% strong performance and leverage in both regions was offset by planned strategic price investments in the U S and to decrease in insurance results at Ahold Delhaize group.
Speaker Change: Earnings per share was 69%.
Speaker Change: Okay.
Speaker Change: <unk> 54.
Speaker Change: The full year in line with our guidance.
Speaker Change: Operating income for the quarter was 607 million Euro <unk>.
Yolanda: Diluted underlying earnings per share was <unk> 62, euro cents up 4% four 6%, sorry, primarily driven by higher underlying operating profit the impact from the share buyback program and foreign exchange rates, partly offset by higher financial expenses and income taxes.
Speaker Change: Presenting and I in France operating margin of two 6%.
Speaker Change: <unk> results were.
Speaker Change: 51 million lower than the underlying results largely related Q&A.
Speaker Change: And then.
Speaker Change: And additional funding of the Dutch pension plan.
Speaker Change: With this change we have reduced our overall pension risk exposure.
Yolanda: Slide 20 shows our results on an <unk> reported basis for Q1, which were in line with our underlying performance.
Speaker Change: Eliminated the annual right.
Speaker Change: In the noncash charges.
Q1 comparable sales growth with three 3%, which includes a positive net impact of 0.4 percentage points from weather and calendar shifts and the negative impact of <unk> five percentage points from the end of tobacco sales in the Netherlands and Belgium.
Speaker Change: For the full year operating income was two points.
Speaker Change: In Euro BP.
Speaker Change: <unk> operating margin of three 1%.
Speaker Change: <unk> results.
Speaker Change: 824 million Euro lower underlying results largely due to cost associated with the following elements.
Yolanda: U S comparable sales growth shows a positive net impact from calendar shifts and winter storms or 0.5 percentage points.
Speaker Change: Transitional schools as part of the Belgium, Fuji future plan, the closure of stopping shelf schools and the amendment to additional funding.
Yolanda: In Europe, there was around a one 1% percentage points negative net impact from tobacco in calendar.
Yolanda: Commented both regions comparable sales growth this quarter was a very strong performance in online sales, which increased 13, 7%.
Speaker Change: Okay.
Speaker Change: Pension plan.
Speaker Change: That's great.
Speaker Change: Q4 performance starting with revenues.
Speaker Change: Comparable sales were up one 4%, which included a negative.
Yolanda: Here, we see that our investments in expanding our omni channel infrastructure and enhancements to our digital loyalty programs.
Speaker Change: Zero.
Speaker Change: <unk> points from Webster and current initiatives.
Yolanda: <unk> strong results.
Yolanda: In both regions, we are on a steady trajectory fueled by the fourth consecutive quarter of double digit growth in online grocery.
Speaker Change: The impact of one one percentage points from the end of tobacco sales in the nine months.
Speaker Change: U S comparable sales.
Yolanda: To accommodate how U S consumers want to shop, our U S brands have expanded the accessibility of our same day delivery options, but additional click and click and collect locations more time slots and partnering with Dougherty.
Speaker Change: Paul.
Speaker Change: Okay.
Speaker Change: Wow.
Speaker Change: Basis points.
Speaker Change: In Europe that much.
Speaker Change: Three full percentage.
Speaker Change: Negative.
Speaker Change: Back from <unk>.
Speaker Change: Okay.
Yolanda: Today more than 80% of our stores have a click and collect points, while more customers are using either <unk> or <unk>.
Speaker Change: Looking at the regional performance.
Speaker Change: Net sales were three.
Speaker Change: 90 days.
Speaker Change: Okay.
Speaker Change: Comparable sales excluding gas.
Yolanda: This was a major competitive advantage during the winter storms in early 2025.
Speaker Change: One 2% excluding any net.
Speaker Change: Okay.
Yolanda: Our U S brands, we're well positioned to facilitate their rising customer demand contributing to record online penetration levels.
Speaker Change: Reflecting Halloween.
Speaker Change: Positive momentum.
Speaker Change: Tim.
Speaker Change: VITAS.
Speaker Change: Volume.
Speaker Change: Okay.
Yolanda: Overall, omnichannel customers have grown nearly 25% year on year with high retention levels.
Speaker Change: In addition to the calendar and weather impact sales were impacted.
Speaker Change: Okay.
Yolanda: On top of scaling our capacity to serve Omnichannel customers. We also continue to make steps to improve our utilization and e-commerce performance through innovation AI and smart solutions.
Speaker Change: Around 110 basis points.
Speaker Change: With that I'll stop and shop.
Speaker Change: Yes.
Speaker Change: Around eight basis points from the divestments.
Speaker Change: Act.
Speaker Change: Okay.
Yolanda: All the tiny neighbour neighborhood delivery bundle is an example of this the vendor allowance groceries to be delivered when the delivery person is already in the area utilizing smart algorithms to coordinate delivery times.
Speaker Change: Base declines.
Speaker Change: Yes.
Speaker Change: Net sales grew 10, 9%.
Speaker Change: The impact correct.
Speaker Change: A key highlight of the quarter customers are responding positively to our partnership.
Yolanda: The technology boost productivity reduce <unk> emissions and helps all the time meet increased demand on customers safe on that delivery costs.
Speaker Change: Okay.
Speaker Change: Okay.
Speaker Change: This is accelerating with a 20% increase number of days in Q4.
Yolanda: Now looking at the regional performance in a bit more detail U S. Net sales were $13 9 billion Euro.
Speaker Change: Back to Q3.
Speaker Change: Underlying operating margin in U S.
Yolanda: Comparable sales, excluding gas increased two 6%, excluding net weather and calendar impact, reflecting growing positive comparable sales momentum and positive volumes during the first quarter.
Speaker Change: In line with the second quarter.
Speaker Change: Margin performance year over year.
Speaker Change: Lower nonrecurring items.
Speaker Change: That's helpful. Joe.
Speaker Change: Unfavorable impact from changes in sales mix change.
Yolanda: In addition to the net positive impact from calendar and weather net sales were negatively impacted by the following around 100 basis points from the impact of stop and shop closures and around 20 basis points from a declining gasoline sales.
Speaker Change: <unk> installation.
Speaker Change: In Europe fourth quarter trends were again strong net sales were in full.
4 billion euros up two 4%.
Speaker Change: Being negatively impacted by two eight percentage points from the end of tobacco sales in the Netherlands.
Yolanda: Online sales growth of 17, 9% was a key highlight for the quarter with double digit growth across most spence.
Speaker Change: Excluding the impact of tobacco and calendar shifts comparable sales increase.
Yolanda: Underlying operating margin in the U S was four 4% down 30 basis points from the prior year due to price investments and the change in sales mix from increasing online and pharmacy sales.
Speaker Change: 7%.
Speaker Change: In the U S online sales growth.
Speaker Change: Okay.
Speaker Change: Increasing by 9%.
Speaker Change: Your line operating margin.
Speaker Change: Approximately 4%.
Yolanda: In terms of brand momentum food lines impressive performance now shows 50 consecutive quarters of comparable store sales growth.
Speaker Change: Up 70 basis points.
Speaker Change: Based on device performance recovery.
Yolanda: Equally impressive food lines online performance during the quarter with nearly 40% growth and over a percentage point increase in online penetration.
Speaker Change: Energy costs.
Speaker Change: We think it's important to appreciate the.
Speaker Change: Sally vacation.
Speaker Change: Market positioning.
Speaker Change: Okay.
Yolanda: Food line continues to grow that footprint with the opening of our new store located north of Charlotte and plans to open an additional five stores throughout the year.
Speaker Change: Yeah.
Speaker Change: European teams.
Speaker Change: All the time.
Speaker Change: <unk> strong growth.
Speaker Change: Expanding its market share.
Yolanda: Construction is also underway for the next round of Omnichannel Remodels with 152 stores planned for the Charlotte market by the end of the year.
Speaker Change: 37, 7%.
Speaker Change: Supported by <unk>, Inc.
Speaker Change: Got it.
Speaker Change: And loyalty among existing customers.
Yolanda: <unk> brand strength is it clear testimony to the strong connection the brand has with its communities. One remarkable achievement I would like to highlight is the food line feeds program, which started in 2014 and since then already handed at one 5 billion meals and they are not done our new goal is three.
Speaker Change: Belgium continues its strong market recovery following the transition of stores and the affiliate model.
Speaker Change: With an improved net promoter score.
Speaker Change: Increase in number of customers and markets at year end, well above pre announcement levels.
Speaker Change: Finally.
Yolanda: Billion meals by 2032.
Speaker Change: Okay.
Yolanda: These are the kind of initiatives that may be particularly proud of our people.
Speaker Change: So an acceleration in sales okay.
Speaker Change: Achieved an all time high.
Yolanda: Turning now to Europe sales were $9 3 billion, an increase of 10, 1%.
Speaker Change: Accuses disconnect at this time.
Speaker Change: Highest ever quarterly sales.
Speaker Change: This in combination with double digit growth in advertising services and a relentless focus on cost management.
Yolanda: This is driven by the integration of trophy, which contributed 647 million euros and the positive impact from comparable sales growth of three 7%.
Speaker Change: This increase.
Speaker Change: Increases in profitability with full year underlying EBITDA growing to $185 million.
Yolanda: Net sales were negatively impacted by <unk> eight percentage points from the change in operating model at affiliated stores in Belgium.
Speaker Change: 159 million.
Yolanda: We expect around a half of a percentage point impact for the second quarter and a minimal impact in the second half of the year.
Speaker Change: Part of both.
Speaker Change: Okay.
Speaker Change: Is it the market the.
Speaker Change: Proposition.
Speaker Change: Access to a 47000 seals.
Yolanda: Europe's comparable sales growth figure includes the following a negative impact of one three percentage points from the end of tobacco sales and a net positive impact of 0.2 percentage points from the calendar shifts from new year and Easter.
Speaker Change: Okay.
Speaker Change: Furnishings, calling that relation with <unk> in addition to the compelling holiday.
Speaker Change: Thank you.
Speaker Change: Five 6% increase in sales.
Speaker Change: So introduced probably go shop, which was a resounding success second pop up event planned for later this year in Belgium.
Yolanda: All experienced double digit sales growth during the quarter as well driven by new opportunities with social commerce and expanded offerings in home, leaving in appliances and notable initiatives is a partnership with the Belgium home renovation TV show, which showcases both product assortments and price cuts.
Speaker Change: Moving now to free cash flow.
Speaker Change: Q4 free cash.
Speaker Change: One 3 billion.
Speaker Change: Which we presented this in English.
Speaker Change: Keith.
Speaker Change: 27 million Euro.
Speaker Change: Q4 2023.
Yolanda: <unk> two dedicated pages on their website.
Speaker Change: Fiscal year, we realized a free cash flow.
Yolanda: Underlying operating margin in Europe was three 4% up 30 basis points from the prior year.
Speaker Change: For $2 5 billion Europe.
Speaker Change: Our guidance for the year.
Yolanda: Strong performance in the Benelux region more than offset margin pressure in the <unk> region. This includes the dilutive impact of integrating profi the income tax impact in Romania, and consumer pressures in Serbia.
Speaker Change: Our net capital expenditure for the year well below original guidance in part due to China.
Speaker Change: Certain projects shifted to 2025 like Atlanta distribution center expansion.
Yolanda: Moving on to Slide 26, our Q1 free cash flow was 199 million Euro, which represents a decrease of $178 million compared to Q1 2024.
Speaker Change: Which store Rollouts in CSD and delaying some models in the U S.
Speaker Change: Okay great.
Speaker Change: Okay.
Speaker Change: The new strategy.
Speaker Change: Yes.
Speaker Change: Okay.
Speaker Change: Turning slightly that strength.
Yolanda: This was largely related to an increase in net investments relative to the prior year as we cycle. The divestment of two meet facilities in the U S.
Speaker Change: Underlying operations allowed us to take the opportunity to optimize our future pension obligations in the Netherlands with additional funding to the Dutch pension plan of 105 million Euro.
Yolanda: This wraps up my financial review of Q1 and brings me to our outlook.
Speaker Change: Okay.
Yolanda: Our teams have delivered a solid start of the year and our performance. This far in the second quarter has been reassuring.
The picture on Slide 27, you can see our net debt reached.
Speaker Change: Yes.
Speaker Change: Despite returning $2 billion.
Yolanda: Well, David as additional volatility in the macro environment with terrorists and fluctuations in exchange rates, we maintained our guidance for 2025.
Speaker Change: Sure.
Speaker Change: Yeah.
Speaker Change: We were able to show a decline mainly due to healthy free cash flow levels.
Speaker Change: The offset by the impact of foreign exchange.
Yolanda: Provide a clear framework to work with for your models. Our EPS guidance reflects an average U S euro rate of $1 10 for 2025.
Speaker Change: Debt.
Speaker Change: But these three doses six to nine months.
Speaker Change: To increase the dividend.
Speaker Change: Okay.
Speaker Change: For 2020.
Yolanda: With our strong market positions, our financial strength and the great foundational work, we have carried out over the last few years I'm confident that we are well positioned to deliver on our growing together plants in this year.
Speaker Change: Two one year ago.
Speaker Change: <unk>.
Speaker Change: Yeah.
Speaker Change: We've also initiated the 1 billion euros.
Speaker Change: Grants for 2025 on December 30 <unk>.
Yolanda: We will stay focused on doing the right thing for the long term health and success of our business and we will continue to serve and protect our customers, providing a broad and healthy assortment with choice for all wallet sizes.
Speaker Change: Finally, let me provide.
Speaker Change: Our healthy community and planets priorities.
Speaker Change: In 2024, the percentage of owned brand healthy food sales was 52, 4%.
Yolanda: If you will leverage our strength keeping our own house in order and ensure we stay well invested in our value proposition whilst growing our footprint.
Speaker Change: This represents a step out almost one percentage point compared to 2023, if we exclude the negative impact of <unk> three five percentage points from the transition to Nutri score of 2.0 for our Dutch and Belgium, France.
Yolanda: And with that I would like I would like to thank you for tuning in and Sharon. Please open the lines for questions.
Speaker Change: Thank you to ask a question you will need to press star one on your telephone and wait for your name to be announced to withdraw your question. Please press star one again.
Speaker Change: Total tons of food waste pet food sales was 35% lower than our 2016 baseline.
Speaker Change: This is a similar result as in 'twenty.
We will now go to our first question.
Speaker Change: However, it includes <unk>.
Speaker Change: In fact, our full percentage points from improve data quality and measurements in the U S.
Speaker Change: And your first question today comes from the line of Robert Jan Vos from ABN Omri <unk> hate to ask please go ahead.
Speaker Change: In Europe performance improved driven by.
Speaker Change: Exploration with partners to increase food donations.
Speaker Change: Yes, hi, good morning, all and thanks for taking my two questions.
Speaker Change: The first one in February your EPS growth outlook was based on an implicit modest exchange rate tailwind on EPS growth, whereas the current exchange rates that you were guidance or that you mentioned, Tim implies modest headwind on EPS growth. So my first.
Speaker Change: We've reduced our C O two emissions in our own operations by 36% compared to our 2018 baseline.
Speaker Change: Treatment of 2% versus last year, driven by the installation of more sustainable refrigeration systems in the U S stores and an increased use of clean energy in Europe.
Speaker Change: Question is where did you find the new way to keep your EPS guidance unchanged. Despite this the estimated currency related negative delta, while some estimated a few percentage points on EPS.
Speaker Change: So Virgin own brand plastic packaging, we can report a 10% production comes back.
Speaker Change: 91.
Speaker Change: Which is equal to a reduction last year.
Speaker Change: My second question is on Profi.
Speaker Change: Our brands were able to increase the percentage of recycled.
Speaker Change: You mentioned that it had a modest negative impact on net income in the quarter and that it was mildly diluted for EBIT margin.
Speaker Change: And continued to implement initiatives to replace plastic packaging with paper or cardboard.
Speaker Change: For Europe based on this is it fair to assume that protease EBIT margin was about 2% or maybe slightly below that in the quarter.
Speaker Change: As we move to our outlook for 2025, we have several leaders at our disposal to navigate the environment.
Speaker Change: Using a gliding to get our strategy and our growth model as a guide you can count on us to keep a steady pace as we accelerate new store openings, and remodels and prioritize and add to the scope of price investments.
Speaker Change: Were my two questions. Thank you.
Speaker Change: Thank you very much for those questions first.
Speaker Change: First on EPS.
Speaker Change: <unk> guidance is a range as what we include it in our guidance is the one point 10, which gives us the confidence that we are able to deliver on the foundations that we've presented and that is a balancing act between growth on the one side and margin on the other side for US it's important to.
Speaker Change: We will enrich our omnichannel capabilities driving growth and customer loyalty and expanding our reach.
Speaker Change: That has a proven and successful track record.
Speaker Change: At the same time, we will also be focused on integrating trophy or seven.
Speaker Change: We remain focused on the underlying performance.
Speaker Change: And we hope that with the guidance given that we have provided you with some input for the financial models that they're using but the guidance reflects for EPS.
Speaker Change: Local brand.
Speaker Change: Here are some of the.
Speaker Change: While our 2025 financials.
Speaker Change: To take into account.
Speaker Change: The integration will add around 3 billion in net sales.
Speaker Change: A range like a mid to high single digit also reflects a range.
Speaker Change: Dilutive impact to our European margin in the first year there.
Speaker Change: Then on trophy as you know we don't guide.
Speaker Change: It will be offset by improvements in the rest of the EU region.
Speaker Change: Guide on a brand level a for profit margins the from fee impact, which was negative indeed in the first quarter has been absorbed by the EU.
Speaker Change: Taking net financial expenses into account. This will result in a net.
Speaker Change: In fact, two underlying EPS performance.
Speaker Change: Results that we presented and are also absorbed in the guidance that we've given.
Speaker Change: Finally, adding profi impact on capital expenditure by around 150 million Euro, which includes maintenance capex as well as plans to open right.
Speaker Change: We expect pro fee to contribute to our margin in 2026 onwards, because as we disclosed earlier the synergies that we expect from the trophy Brophy transaction will only materialize amongst approximately one year. After closing the deal. So that is how we how we look at trophy.
Speaker Change: 100, New trophy stores.
Speaker Change: Yeah.
Speaker Change: Reported sales numbers in 2025, there are also a few other specific factors you want to reflect in your expectations.
Speaker Change: Hi.
Speaker Change: Thank you.
Speaker Change: The scope and shelf store closures are estimated to have an impact of between 550 and 575 million.
Speaker Change: Thanks.
Speaker Change: Thank you.
Speaker Change: We will now take the next question. The question comes from the line of is about <unk> <unk> from Morgan Stanley. Please go ahead.
Speaker Change: Thanks.
Speaker Change: That will be around a one.
Speaker Change: At this point.
Speaker Change: Hey, good morning.
Speaker Change: <unk> reported and comparable store sales in Europe due to the end of tobacco sales at all the times franchise locations in the Netherlands.
Speaker Change: I have two questions both of them are on the U S.
Speaker Change: So my first question on the U S could you elaborate on the grocery online sales growth.
Speaker Change: In the first half of the year as well as due to the new regulations coming into force in Belgium from April 1st.
Speaker Change: <unk> said they grew at 40%.
Speaker Change: With Lion, just because the numbers that we need.
Speaker Change: Putting everything together for a 2025 aggregate we expect underlying.
They're just very robust could you expand a little bit more on what you have done in terms of the sales level improvements to take market share and also within those growth rate what was the impact of the winter storm. So that we can understand how the weather.
Speaker Change: Over around 4%.
Speaker Change: Diluted earnings underlying earnings per share growth.
Speaker Change: High single digit at a free cash flow of at least $2 2 billion euros combined.
Speaker Change: This step up in our gross Capex.
Speaker Change: Weather trends is evolving in the online grocery business in the U S.
Speaker Change: The $2 7 billion euros.
Speaker Change: That's what I said at strategy day, that's all locked through our plan for the coming year.
Speaker Change: And then my second question also on the U S could you comment a little bit about your expectation of what might happen with snap program and whether you expect any cut back to be a mouse.
Speaker Change: In 2025, it's balanced.
Speaker Change: But it's about industry leader.
Speaker Change: And our cost discipline, we are investing in the future and in cash generation, resulting in growing shareholder returns and.
Speaker Change: Once the budgets are places like that.
Speaker Change: And linked to that how should we think about your sensitivity to any perpetual cutback map would you expect it to be quite similar to how it was in 2023.
France: And we are not dependent on one element to drive values. Since we have multiple levers to deal with volatility and economic political or social context with that let me hand back to France to give you a flavor of our priorities for this year.
Speaker Change: Is anything changed which makes you think this is it may be higher or lower.
Speaker Change: It does come back.
Speaker Change: Yeah.
Speaker Change: Thank you very much.
Speaker Change: So thank you Isabella for your questions.
Speaker Change: Much of our success over the past years comes down to doing debate.
Speaker Change: Address Liberty online.
Speaker Change: Growth and why do we have this.
Speaker Change: Retail world, while at the same time innovating for the future.
Speaker Change: Strong growth.
Speaker Change: Yolanda will say a few things on the weather impacts in the U S and I will come back to the labor to snap and what we might expect as far as we have for the.
Speaker Change: Customers are responding positively to our actions with increasing engagements with our apps and loyalty programs and more frequently becoming omni channel shoppers.
Speaker Change: Our crystal ball or no crystal ball so on online.
Speaker Change: And 17, 9% growth in the U S. In the first quarter is phenomenal.
Speaker Change: With a growing preference for our own brand products.
Speaker Change: Sure.
Speaker Change: To continue to invest we're just winning formula.
Speaker Change: We have an eight 8% online participation ourselves now which is record high for us in the U S and I think this is.
Speaker Change: Sequencing, our investments show that to build up.
Speaker Change: So all the time and thus yielding compounding growth.
Speaker Change:
Speaker Change: Sequential results.
Speaker Change: Okay.
Speaker Change: Want to sound too confidence, but in all the investments we've made in the last years on digital online.
Speaker Change: We'll be doing four key things.
Speaker Change: Yeah.
Speaker Change: New store openings and Remodels.
Speaker Change: Store pick.
Speaker Change: Software, which is proprietary but also the partnerships we have with instant garten door dish.
Speaker Change: Okay.
Speaker Change: Adding to the scope of price investments.
Speaker Change: Enriching, our omnichannel capabilities, and therefore driving growth in customer loyalty and scanning technologies.
Speaker Change: And where food Lion came a little bit later into the game.
Speaker Change: One lumpier than the penetration that's why also the richness that therefore that the catch up not quite fast with a 40% growth online Yolanda mentioned for food line. So I think we are in the U S.
Speaker Change: Moving and successful track record.
Speaker Change: Yeah.
Speaker Change: Our underlying operating margin guidance of around 4% and our gross capital expenditure plans.
Speaker Change: Quite some learnings we took quite some consequences last year, when we close down a few fulfillment centers and transferred those sales to our in store pick click and collect systems, which is super convenient for customers to drive their car and from the distortion in three minutes, you're your basket is in your <unk>.
Speaker Change: <unk>, two 7 billion euro.
Speaker Change: Reflective of this stops.
Speaker Change: Yeah.
Speaker Change: We are ready to sell.
Speaker Change: Our branch organic store growth and remodeling program in the U S on top of that.
Speaker Change: Company stores, we expect to open an additional 10 stores. This year starting with the recent launch of a new food Lion and Troutman North Carolina.
Speaker Change: So I think.
Speaker Change: A good good online offering.
Speaker Change: Full store is at your disposal, which is rather unique for online.
Speaker Change: We will also increase the pace of remodeling in the U S, including the resumption of Remodels at stop <unk> shop.
Speaker Change: And as your own full store with your own cultural and ethnic assortment if you shop there.
Speaker Change: In 2025, we will build on the group.
Speaker Change: It's a very good digital connection with high efficiencies and in store.
Speaker Change: Before.
Speaker Change: And the first rounds of the planned $1 billion of price investments, we outlined from the payer for the period 2025 to 2028.
Speaker Change: At the moment in store pick.
Speaker Change: And I think we have a very good digital connection with our customers and the high level of convenience.
Speaker Change: On snap.
Speaker Change:
Speaker Change: All brands will make depression.
Speaker Change: First of all the present snap levels the SNP Gov.
Speaker Change: Throughout the year tailored to the local positioning and pricing strategies.
Speaker Change: Government support levels are at the lowest levels since COVID-19. So we at the very low snip level at the moment.
Speaker Change: Okay.
Speaker Change: In Europe, our teams in central and South Eastern Europe, we will be focused on the integration of Coffey and with trophy. We at over 1700 stores that we will serve in.
Speaker Change: What might happen or what the government might decide on that we don't know we have not.
Speaker Change: Further information.
Speaker Change: I would like to further supports if they would like to hybrid or to increase it more we don't know what they have in mind. So we have no information on snap, but the present snap levels are at the lowest since <unk> already.
Speaker Change: Additional one 3 million customers on it.
Speaker Change: Okay.
Speaker Change: We will continue to invest decisively and with focus on our strategic priorities across the region also to capture more opportunities.
Speaker Change: There will be interest and ability.
Speaker Change: And then.
Speaker Change: On whether the weather impact for the U S. Yolanda, yes weather impacted our comp sales in the U S positively and these were related to the snow storms and by 130 basis points and that was offset by new year's Eve and Easter up by 80 basis points, so weather impacted our comp sales.
Speaker Change: In Belgium, our team to build on the successful transformation of third.
Speaker Change: Only churn of proposition.
Speaker Change: Okay.
Speaker Change: A new home shop center, putting e-commerce on the path to profitability.
Speaker Change: And we also reasonably.
Speaker Change: Substantially this quarter.
Speaker Change: Subject to regulatory approval the planned acquisition of gel foot, which included 325 points of sale.
Speaker Change: Thank you and are you able to break out that weather impact on the online sales.
Speaker Change: Should we assume that was where it was concentrated.
Speaker Change: And with this acquisition the last one to open new potential in the medium term in the fast growing convenience space.
Speaker Change: No we can't we can't break that out and of course, it country related but I would not say, Wisconsin traded so it contributed but not concentrate.
Speaker Change: And in terms of scaling our technologies, we will report S&P.
Speaker Change: P S for Hana to our European brands to establish one standardized global financial backbone and ramp up.
Speaker Change: Okay. Thank you.
Speaker Change: Thank you.
Speaker Change: Your next question comes from the line of Frederic Wild from Jefferies. Please go ahead.
Speaker Change: At our <unk> checkup in Romania.
Yolanda: Good morning from Yolanda J P. M team. Thank you for taking my question.
Speaker Change: Which alongside our other data.
Speaker Change: Okay.
Speaker Change: We will support the development of new digital data and tech capabilities.
Frederic Wild: So first of all could you talk us on maybe your comments on U S behaviors, you're seeing at the moment. For example are you seeing maybe more private label trading.
Speaker Change: These examples demonstrate we have a clear plan for the year, we will continue to build scale, where it makes sense.
Yolanda: Have you seen any volume response to sean's sequential price cuts.
Speaker Change: <unk>, where we can make the difference.
Yolanda: How does all these changing through the quarter on into April.
Speaker Change: Our guidance for 2025 ecosystems.
Speaker Change: We're going to get ambitions and we are fully committed to realizing the growth opportunities.
Yolanda: Second question is you've had more than 40% of the store base investments in store control could you remind me. What this was in Q4 and how do you see the cadence of that in the developing through the rest of this year okay.
Speaker Change: Yeah.
Speaker Change: <unk> is ahead of us.
Speaker Change: I am pleased to say that we're off to a good start for the year or.
Yolanda: Yeah.
Speaker Change: Carrying the good momentum from the holiday season.
Speaker Change: Yolanda I will take.
Speaker Change: The last one which is also about frederick by itself or the more difficult question.
Speaker Change: Yes.
Speaker Change: Evidence for another good year for our brand.
Speaker Change: Communities and company.
Speaker Change: Sure.
Speaker Change: You had some light on the on the penetration of the store base Remodels for stop and shop on the U S behaviors, what do we see.
Speaker Change: Sharon Please open the lines for questions.
Speaker Change: Thank you.
At the moment, we see.
Speaker Change: To ask a question you will need to press star one one on your telephone and wait for your name to be announced to withdraw your question. Please press star one.
Speaker Change: <unk> and rational pricing behavior in the market.
Speaker Change: And it comes down to I think that a lot of companies are dealing now with <unk>.
Speaker Change: Okay.
Speaker Change: Please standby, while we compile the Q&A.
Speaker Change: Investing in technology, and digital E Commerce and online.
Speaker Change: E Commerce and pharmacy of Yolanda mentioned this earlier.
Speaker Change: Our strong growth drivers for us, but at the same time also dilutive to our store margins.
Speaker Change: Thank you.
Speaker Change: We will now go to our first question.
Speaker Change: One moment please.
Speaker Change: That phenomenon is not unique for us so we have to deal with it anyhow.
Speaker Change: And your first question comes from the line of Robert Jan Vos from ABN Amro.
Speaker Change: And what we see from a customer behavior. A point is that yes. There is more I think uncertainty in the markets.
Speaker Change: Please go ahead.
Speaker Change: With everything what what.
Speaker Change: Okay.
Speaker Change: Is out there might be announced or.
Speaker Change: Good morning, all and thanks for taking my question.
Speaker Change: Might still come there I think the ultra that is quite uncertain.
Speaker Change: First one.
Speaker Change: Concerning.
Speaker Change: I think that's also the reason why.
Speaker Change: Comments from Profi and Europe, It's fair to assume that's including <unk>, you expect a roughly flat underlying EBIT margin of error of about three 8% of core Europe in 2025.
Speaker Change: The fact that we start addressing.
Speaker Change: Favorable prices since the middle of last year, even more than we did before.
Speaker Change: Investing in our prices invested in our private label, having also more price opening price private label.
Speaker Change: My first question.
Speaker Change: And my second.
Speaker Change: A question on your stock.
Speaker Change: Our shows.
Speaker Change: I think they are right to the right.
Speaker Change: But the investments that stop and shop and this will continue in 2020.
Speaker Change: Reaction, there so that customers, where they might get or might have more challenged baskets or challenge household budgets. They also can still show up in our store both for the more price sensitive for them for the list price insensitive assortments. So.
Speaker Change: Okay.
Can you elaborate a little bit on the first effects you've seen.
Speaker Change: Of those initial price investments.
Speaker Change: Thank you.
Speaker Change: I think it's fair to say that we will see a more value focused customer due to uncertainty and that's why also we started with those price investments last year.
Speaker Change: Yeah. Thank you for your question.
Speaker Change: Yes.
Speaker Change: As you know, we don't give guidance on a on a regional level and for the next year, we trend around 4% and like I said that strategy Ultra V. We believe base, reaching the 4% plus.
Speaker Change: That's why also private brands plays an important role.
Speaker Change: And so far I think within the with the sales numbers, we see now.
Speaker Change: Jim and I have to leave it at that.
Speaker Change: We are on the right track there and if you look at stop <unk> shop also dare.
Speaker Change: Yes, Hello, gentlemen, proprietary investments.
Speaker Change: The promotional prices, we do the way we talk about it in the store the way we run our promotions and the way we have special things or meal deals in meal solutions are the right things to also.
Yeah.
Speaker Change: We have communicated this growing together.
Speaker Change: The D C.
Speaker Change: The CAGR.
Speaker Change: 4% for the total sales CAGR.
Speaker Change: And on an average 4% margin and of course, you don't fall.
Speaker Change: Given a better customer experience for dose.
Speaker Change: In January to start with the plant so you prepare already.
Speaker Change: And budgets, which which might be challenged the store base and four days, yes, we indeed.
Speaker Change: Also in the U S with price investments already cater for growth and.
Speaker Change: <unk> already invested in 40% of the store base and stop and shop, and we are now focusing more on our price investments because our stores are pretty much pretty good conditions and we have a light renovation model that we're deploying a which is a lot lower investment levels as we are shifting to that price investments because.
Speaker Change: And therefore, maybe not a surprise, but it's good.
Speaker Change: To know that we had positive volumes in the U S in the fourth quarter.
Speaker Change: The first is it fair.
Speaker Change: Yes.
Speaker Change: Very pleased just to be a request also there we saw growth in volume for the total U S. Also saw effects positive effects stop assure brands, where we invested in and pricing but also.
Speaker Change: That is how we can save our customers a best and as Frans already indicated 40% off the stores at stop <unk> shop, now have those price investments going on I mean, we've rolled that out going forward.
Speaker Change: Taken in customer value and private brands in this kind of thing so.
Speaker Change: Okay.
Speaker Change: Very happy with the momentum how we came out of this.
Speaker Change: Okay.
Speaker Change: What we what we said earlier Frederic.
Speaker Change: Okay.
Speaker Change: Total U S.
Speaker Change: We've remodeled now roughly 200 stores at stop <unk> shop already we are in the total store fleet of 360.
Speaker Change: You also can confirm that we see positive upticks with stop and shop.
Speaker Change: And the start of the year with the price investments, we already made and will make further ultra in the year and let's not forget that we set for the strategy period.
Speaker Change: We already said earlier, that's part of the base, we don't need to remodel because they are in good shape.
Speaker Change: And we have light remodels for a number of stores now where with lower amounts of investments, we can still do a great job there.
Speaker Change: Billion priced investments of dollars four in the U S and Louisville also.
Speaker Change: Thank you have a few here.
Speaker Change: To those price investments.
Speaker Change: Two to make sure shop, which will compete in those neighborhoods.
Speaker Change: Okay.
Speaker Change: For our U S brands.
Speaker Change: Thank you both very much.
Speaker Change: Maybe to add to that our France, if you look at stop <unk> shop Indeed.
Speaker Change: Thank you.
Speaker Change: Your next question comes from the line of Michel the clot from KBC Securities. Please go ahead.
Speaker Change: We started with.
Speaker Change: Rhode Island.
Speaker Change: All the stores that Rhode Island have reduced by almost 3500 product.
Speaker Change: Yes, hi, thanks for taking my questions.
Speaker Change: Our customers will experience it and we are indeed happy that we ended with positive volumes do those five investments at large it's not only stop and shop, we see a positive trend really paying it.
Speaker Change: The first one would be on on Europe and more specifically.
Speaker Change: Belgium.
Speaker Change: One of your key competitors, there recently issued a profit warning stating that.
Speaker Change: Competition has intensified and there is more pricing pressure as well.
Speaker Change: Alright, thank you.
Speaker Change: Thank you.
Speaker Change: We will now take the next question. The question comes from the line of is about <unk>.
Speaker Change: I was just wondering in the past you always mentioned that the Belgium, and the transformation has been outperforming.
Speaker Change: Wanted to get your view if this strength is still it's still ongoing and if you're maybe the competitor that they are referring to of course and then the.
Luke: Since that Luke go ahead.
Speaker Change: Good morning, and thank you for taking my question.
Luke: My thought on that.
Luke: Oh, sorry.
Speaker Change: The second.
Speaker Change: Question would be returning to the to the online sales growth in the U S, which was of course very strong.
Luke: Okay.
Luke: Could this but.
Luke: But could you comment on the ACA school long term plans.
Speaker Change: In the past the online sales the margins are of course lower than the U S. Overall margins.
Luke: So for example.
Debbie: This is debbie.
Speaker Change: I understand that you cannot be very specific about that but can you maybe tell us. How these online margins have been have been trending over the recent orders given the strong sales uplift in the recent years those would be my questions. Thanks.
Debbie: So synergies what level of contingency you have in mind.
Debbie: For example is the business breakeven today it would be good to understand.
Debbie: What do you have in mind on the multiyear view could lose business.
Speaker Change: 2025 Gigawatts.
Speaker Change: Great question. So thank you very much Yolanda will come back to the second one.
Debbie: Okay.
Debbie: Okay.
Debbie: Okay.
Speaker Change: Will.
Debbie: My other question is just on the U S.
Speaker Change: Give a little bit more feel for the Belgian market.
Debbie: Uh huh.
Yes, we said in the previous call in the previous quarter that our Belgium business.
Debbie: Okay.
Debbie: The one off it was about.
Debbie: Thank you Paul So is this a realistic level.
Speaker Change: Back on higher market share than pre our intervention in franchising the other than 28 stores.
Debbie: The level of.
Debbie: That we can expect for the first half.
Speaker Change: Okay, and just reconfirm that dose or 128 were already fully transitioned last quarter, but that indeed the business it keeps growing.
Debbie: On the profit question.
Debbie: Great questions you actually Pizza last question from me, sorry, I lost track that.
Speaker Change: And also the business keeps growing in market share.
Debbie: Perfect question that you asked every time.
Debbie: We do expect.
Speaker Change: I think it has to do with the entrepreneurialism spirit in the stores the Sunday openings.
Debbie: The synergies that we can realize together.
Debbie: That profit and denying the euro.
Speaker Change: But also our associates she is.
Debbie: European margins are that we guided for for the other brands as well.
Speaker Change: It's a great environment to work in and it's also the entrepreneurialism.
Debbie: On our current operating profit level, they are profitable, but as you probably know that we intended to close the transaction.
Speaker Change: Even better.
Speaker Change: Field with the local communities to compete even better so.
Speaker Change: The Dallas stores are gaining share and gaining share, but also the <unk> stores in Belgium gained share and not only because of the open more stores, but also on the same the same surface. They also gained share comparable sales. So we see our market shares both for the less segments and for the overtime.
Debbie: Summer it took a bit longer and the synergies.
Debbie: So in the next year, we are now preparing for those synergies and.
Debbie: Pain at the real synergy payback will start in 2026.
Debbie: Could you repeat your second question. Please.
Speaker Change: Segment, our <unk> segment is of course, mainly the Dutch speaking part of Belgium.
Debbie: Yeah.
Debbie: My second question was on the U S margin.
Speaker Change: What we see both share is growing and that is yet that is exactly what we had in mind.
Debbie: If I look at the level of decline over Q4, excluding the one offs I guess it implies down 22 basis points, which was in line with what you guided.
Speaker Change: Who is also growing by the way market share, but it's not so much in the supermarket channel. These are bolt business in Belgium. So also there we are like in like in the Netherlands, we are quite happy with that development.
Debbie: Okay.
Debbie: I was wondering is that the level of decline we should expect over the cycle.
Speaker Change: Yeah, and thank you for your question on online profitability, we are strongly improving our online profitability most of our brands in Q1 were already profitable.
Debbie: Yeah.
Debbie: <unk> does price.
Debbie: It would come onto your life in the run rate.
Speaker Change: Reallocated, we expect to be profitable 2026 onwards.
Debbie: Yeah.
Debbie: Thank you for your question.
Speaker Change: And repeating it Ed Frac as you know and we're sorry for that but we don't give guidance on reaching a level four autonomy.
Speaker Change: Yeah.
Speaker Change: Okay. That's clear thank you.
Speaker Change: Thank you.
Speaker Change: 70, <unk> company as a whole we will trend around 4%, but if you take out the.
Speaker Change: Your next question comes from the line of Palm slot the Gao from Kepler. Please go ahead.
Speaker Change: Oh U S margin is expected to be stable.
Speaker Change: Good morning, Thank you for taking my questions. The first one would be around the owned brands could you help us too.
Speaker Change: Yeah.
Speaker Change: More close on its own.
Speaker Change: Thank you.
Speaker Change: Penetration in the U S, whether you're stoned or imaging or is it from one to another.
Speaker Change: Sequentially.
Speaker Change: Okay.
Speaker Change: Right.
Speaker Change: What kind of growth do you experience from from your off Bronco.
Speaker Change: Thank you Keith.
Speaker Change: The second question would be a follow up on the online sales. So we understand that there is a dilutive on margin in the U S. Economy can you quantify the impact on kind of understands on their own books.
Speaker Change: We will now go to the next question.
Speaker Change: And your next question comes from the line of William Woods from Bernstein. Please go ahead.
William Woods: Hi, good morning, Thanks for taking the questions.
Speaker Change: It does not deteriorate anymore in Europe. Thank you.
Speaker Change: I think it's kind of pick up on the U S.
William Woods: And again I think there's a lot of nervousness about that.
Speaker Change: Okay, So thats RASK, which once.
Speaker Change: I'm sorry could you repeat the second question what is dilutive to margins what did you say.
Brian: Thanks, Brian.
Speaker Change: Does the U S margins need to go down.
Speaker Change: With this backdrop and I think I'm thinking about the commentary that you've made around the impact of price investments.
Speaker Change: Question.
Speaker Change: Online for life on this also.
Speaker Change: Could you quantify the dilutive impact on margin in the U S. Okay.
Speaker Change: Hi, good mix of wage inflation impacting your margins in that space.
Speaker Change: Okay are we right to understand that in Europe. There is no more dilutive impact of online sales. Thank you.
Speaker Change: Why is that.
Speaker Change: Repeat again.
Speaker Change: Okay.
Speaker Change: What is.
Speaker Change: Yeah.
Speaker Change: Bigger picture question.
Speaker Change: Maybe just start with the last question then because we all that night and days region online remains diluted and so as I stated from 26.
Speaker Change: There's been changes at the FCC.
Speaker Change: Yes.
Speaker Change: M&A environment in the U S.
Speaker Change: Why do you take advantage of that merge with Chris. Thanks.
Speaker Change: <unk>.
Speaker Change: Thanks.
Speaker Change: We will be profitable. It will then be a it's still dilutive FBL from watching this of course higher than that.
Speaker Change: Okay.
Speaker Change: Okay.
Speaker Change: Thank you for your advice by wavefront, leading to suggest that if we look at that business around the gross margin I can on this.
And we don't quantify that on denying his role by the way we are very happy with it because.
Speaker Change: Because we believe in that channel model and we need those online customers personalization building communities and I'll say the online.
Speaker Change: Okay.
Speaker Change: The back to Yohan, we presented a growing to get a strategy, where we stated that we are going to invest in prices.
Speaker Change: Estimate spent more money overall than a customer that shops only in our stores.
Speaker Change: Over the period.
Speaker Change: Together strategy, so its not a one off in 2025.
Speaker Change: Profitable impact both ways, but it will remain dilutive for awhile scale, but you also mentioned to you Yolanda earlier that we are trending towards profitability fully allocated on the calculation fully allocated profitability, we're trending towards that and we expect that to emphasis in 2020, and then it still will be diluted so it will be.
Speaker Change: In our sequencing dose investments to get the best return.
Speaker Change: We can get and if you look at the whole year at the U S level, although we don't give guidance on a regional level margin. The margin also in the U S will be rather stable.
Speaker Change: For the full year.
Speaker Change: As a whole because we're balancing our investments and the upsides were creating.
Speaker Change: We become less diluted diluted.
Speaker Change: Right.
Speaker Change: It's a good trend.
Speaker Change: Yes.
Speaker Change: And again like you did.
Speaker Change: And we've talked about it earlier I think you Yolanda ocean in previous quarters.
Speaker Change: As I mentioned.
Just to look only at the online are only at the store channel I think is not anymore, how customers behave customers look for an omnichannel solution.
Speaker Change: Let me talk about.
Speaker Change: Margins in Europe, we see that recovering now.
Speaker Change: They can have that shopping experience under one roof. The same type of offers the same type of private brands has stepped up with assortments.
Speaker Change: The margins in the U S. We have a business where both regions are 4% margin companies.
Speaker Change: And the store experience if they get also this online I think that gets you see we know that the loyalty gets up we know that the customers get will get bigger. We noted the share of wallet is growing and that is exactly what we would like to do so only looking at online is in our view the right thing to look at this you have to look at total customer profit.
Speaker Change: Therefore also not a surprise that youll see in our growing together strategy that 4% margin comes back again.
Speaker Change: <unk>.
Speaker Change: We have been always a 4% margin in the U S with won't don't want to change that and we are.
Speaker Change: Thanks to a 4% margin in Europe, knowing that fit some deviations.
Speaker Change: Debility and total in total value there.
Speaker Change: Unbranded sales. The other question that you face as you know, we're not going to get a strategy.
Speaker Change: Okay.
Speaker Change: On your.
Speaker Change: Suggestion recommendation on this otherwise boring Wednesday.
Speaker Change: <unk> set a target for 2028% to 45%.
Speaker Change: Yes.
Speaker Change: You talked about Kroger.
Speaker Change: Branded food sales.
Speaker Change: <unk> shared with you that.
Speaker Change: When that own brand tree sales team last year with 1% one 1% in Q1.
Speaker Change: We are.
Speaker Change: Then open view on expanding our business also inorganically when opportunities arise which are in line with our strategy.
Speaker Change: U S hasn't been location and ranked 32% to 33% and Europe.
Speaker Change: Yeah.
Speaker Change: And that's why you have seen delta.
Speaker Change: And it's a stronger proposition to our customers Francois.
Speaker Change: She trophy and Europe wishes.
Speaker Change: Oh.
Speaker Change: Brent private brand.
In line with strategy, giving us more strength in markets as well.
Speaker Change: How you call it.
Speaker Change: We formulated the products, we make the proposition if it's on healthy food packaging, if its so nutritional labeling.
Speaker Change: And also like in the past, we opened two opportunities inorganically.
Speaker Change: <unk> fits.
Speaker Change: Our our.
Speaker Change: Our design and if we have good products, there and as we have fantastic wrenches and ultra in the U S and 38% share already attested ranges on formulation healthy gluten free all kind of dietary requirements that makes you different that makes sure that differentiation.
Speaker Change: Our strategy as such we have a spot.
Speaker Change: As you know so we have the firepower in itself, but let me come back to you if we have for sure to ideas.
Speaker Change: M&A in total.
Speaker Change: Thank you can I just clarify on the price investments on the three periods.
Speaker Change: Does that Brent you only can buy with us.
Speaker Change: The strategy I think you've previously said that they would accelerate.
Speaker Change: With big learnings from the year from Europe, with 50 more than 50% in the Netherlands, and Belgium on private brand share. So it is a beautiful learning, where we work with teams to get between Europe and the U S to make those learnings also effective for the U S and the targets Yolanda just mentioned.
Speaker Change: 35, G do you still see them accelerating into 2025.
Speaker Change: Okay.
Speaker Change: Yes, there is an acceleration from 2020 full into a growing together period, but the 1 billion that we talked about it it's a sequence over the full going together period.
Speaker Change: Thank you very much.
Speaker Change: And at that time.
Speaker Change: Thank you.
Speaker Change: Yes, it's also spread with branch through the year as well exactly.
Speaker Change: Your next question comes from the line of William Wallace from Bernstein. Please go ahead.
Speaker Change: Okay.
William Wallace: Hi, good morning, Thanks for taking my questions. The first one is on the price investments can you give any comments on where Youll price index has gone versus peers.
Speaker Change: Thank you very much.
Speaker Change: Okay.
Thank you.
Speaker Change: Our next question comes from the line of from Jefferies. Please go ahead.
William Wallace: Please why only food stop and shop stores have.
William Wallace: Price investment and then the second one is obviously youre balancing price investments in margins in the U S.
Jason: Good morning, Jason.
Jason: Thank you for taking my questions.
Jason: Randy.
William Wallace: Are you seeing any positive reaction to the price investments and how do you see the trajectory of price investments versus margins over the next 12 months. Thanks.
Jason: Okay.
Jason: Moving part.
Jason: Okay.
Jason: First on the 4% margin guide.
Speaker Change: Is that consistent with both ends of the mid single digit to high single digit.
Jason: EPS growth range.
William Wallace: William did the 40%.
Jason: So which of the hardware and the sales you see.
William Wallace: Your 40% question what was it about versus about.
Jason: The bonds with those volumes okay.
William Wallace: Price investments in 40% of the of the stop <unk> shop stores wasn't going in that direction.
Jason: Paul.
Jason: Secondly sooner.
Jason: Okay.
William Wallace: Yes.
Jason: Absolutely.
Jason: Is it right to think that if you deliver mid single digit EPS growth, we should be looking at $2 2 billion.
William Wallace: Why why have you only rolled out over the last three to nine months in 40% of the stop and shops.
William Wallace: All of the stop <unk> shop stores, yes, okay. So.
Jason: Okay.
Jason: Or is that okay.
Jason: No Matt.
William Wallace: That is maybe one of the easier question is today.
If you didn't have a high single digit do you think free cash flow you can get to.
William Wallace: The reason why we do this is.
William Wallace: We would like to be in a way surgical and we would like to make sure that we test and try those price investments what does resonate what gives us elasticity of price uplift.
Jason: Okay. Thank you for your question.
Jason: Yes, the margin of rainfall is consistent to me.
Jason: To high single digit earnings per share guidance that were given it's a combination of share.
William Wallace: Sales uplift so.
William Wallace: It's why we go region by region.
Jason: Sure.
Jason: And FX impact, which is favorable for the.
William Wallace: We test and try and we have a whole team on this not only on the price investments in itself, but also how to communicate in the stores and what we what we have seen is that.
Jason: Interest rates.
Jason: Yeah.
Jason: And at least $2 here it is at least two points.
William Wallace: We are undervalued, let's say by customers on the actual pricing so depressed perception is not where it should be and where we.
Speaker Change: Free cash flow that we are guiding on did you say that.
Speaker Change: And therefore, one could say Hey would you also gave a $90 billion free cash flow for the total strategy area too yes.
William Wallace: We think we deserve it to be so that's why also the in store communication on the labeling on the on the work the work with digital tools.
Speaker Change: At the beginning of the year.
Speaker Change: At least two two for 2025.
William Wallace: Your apps and in your phone these kind of things. We also tested at the same time and I think that's why it's just smart sequence too.
Speaker Change: Fighting for more as a lifestyle 12 for February.
Speaker Change: Okay.
Speaker Change: Forget that we also.
$2 7 billion Capex.
William Wallace: To invest in pricing.
Speaker Change: Capex number for this year.
William Wallace: One Ron your communications jet fuel price perception see your elasticity and price uplift adjust where needed and get better over time and Thats router.
Speaker Change: To take the necessary steps to modernize further our our questions to build stores and to invest further in technology and data.
William Wallace: What we do to set them at a reasonable schedule because we have those price investments are investments so you'd like to have a return on that.
Speaker Change: Of course also fits together.
Speaker Change: Okay. Thank you very much.
Speaker Change: Thank you.
William Wallace: On the fresh index pricing.
Speaker Change: Your next question comes from the line of Francois the Gao from Kepler Cheuvreux. Please go ahead.
William Wallace: Price index, and we track of course, a price indexes that we gained displace them and maybe to the last question funds and maybe I can kick off and you can fill in where in fact, not so much challenging <unk> investments in margin margins. What we are balancing is find investments and crushed.
Speaker Change: Hello. Good morning, Thank you for taking my question.
Speaker Change: Ed.
Speaker Change: Okay.
Speaker Change: But Tom U S devoted to recovery as it bleeds through <unk> or does it go.
Speaker Change: Okay.
William Wallace: So what we're looking at whether or not as Frans said in a surgical way the price investments that we do trigger a greg.
Speaker Change: Awesome.
Speaker Change: <unk> market.
Speaker Change: Yes.
Speaker Change: Globally.
Speaker Change: Are you finding the right players or are you shipping.
William Wallace: And that is a high we will optimize one could say are returns also for our shareholders and we do see that as positive impact what encourage me this quarter was the continuing volume trend.
Speaker Change: Presence from Europe. Thank you.
Speaker Change: So the second question was.
Speaker Change: Do we find the right supplier base for our private brand strategy is that your question.
William Wallace: As in Q4, we had already started with those price investments in Q4 as you know we saw positive volumes in the U S and that trend has continued and further in place in Q1. So that is that on a macro level in the U S. Why we see that those price investments seem to take a positive reactions.
Speaker Change: In the U S.
Speaker Change: Sure.
Speaker Change: Okay.
Speaker Change: We're taking a little bit broader because we get questions question tariffs as well.
Speaker Change: In food retail, we all have we have a very.
Speaker Change: A very small number of our sales in general merchandize to start with food retail is very local.
William Wallace: The numbers, we have and those are always lacking a little bit the Nielsen numbers as I mentioned before in U S. We are <unk>.
Speaker Change: And although we import.
William Wallace: Slower with the Nielsen numbers, then in Europe, It's just about that one mistake, but that's as a provider.
Speaker Change: A few things from Asia and Europe.
Speaker Change: It's a relatively small share and it's very much a level playing field for <unk>.
William Wallace: We see.
William Wallace: Stable or growing market share in the U S in our markets and we see the second quarter in a row that we have parcel volumes.
Speaker Change: The competitors we compete with.
Speaker Change: Okay.
William Wallace: And those are positive.
Speaker Change: Local business food so the terrorists.
William Wallace: Positive indicators.
William Wallace: We do the right thing and we also see that a positive trend with stop and shop as well, but again.
Speaker Change: Most of it.
Speaker Change: It has been a heavy impact on us.
Speaker Change: Secondly, okay.
William Wallace: We know that we.
Speaker Change: Element of price investments and therefore also volume growth.
We lost share.
William Wallace: Over time with stop and shop, we said, we'd go to invest in this brand and not only in pricing, but also in private brands all of in store execution Ocean produce and also in the asset quality and the fleet quality, which we did already for a big part. So there are number of things which come together.
Speaker Change: We see volume growth in all our branch in the U S.
Speaker Change: As indicated before.
Speaker Change: We intentionally did.
Speaker Change: This because we would like to deliver on our first year of going together, which is a growth strategy as you know.
Speaker Change: And that's why we started.
Speaker Change: Quarter already with our progress.
William Wallace: As a whole and that is a gradual a gradual improvement, but you would like to make sure that you spent the money.
Speaker Change: We're also happy to see that also the start of the year as I mentioned before.
William Wallace: India and also the effect will come so that's why that's why we are careful but the moment, we see that things are working then we rolled that of course out.
Speaker Change: Very good.
Speaker Change: Okay.
Speaker Change: On growth and on volume.
Speaker Change: And so yes.
Speaker Change: It was our promise and growing to grow our business and that's a 4% CAGR.
William Wallace: Excellent. Thank you very much.
William Wallace: Thank you.
Speaker Change: The strategy period.
Speaker Change: Your next question comes from the line of Dan onto law from the Golf play Telecom. Please go ahead.
Speaker Change: So the targets to deliver on.
Speaker Change: Yes. Good morning, it's another girlfriend halfway to come and thank you for taking my questions.
Speaker Change: Thank you very much.
Speaker Change: Thank you.
Speaker Change: I've actually come like to come back on this topic show up because if you look at your numbers for the U S.
Speaker Change: Your next question comes from the line of.
Speaker Change: And then on to go from the Gulf Coast to come can you go ahead.
Speaker Change: And you should look at the sales excluding online and you say food line and hand afford us taking the lead then I arrived.
Speaker Change: Yes, good morning, it's coming on the board.
Speaker Change: Peter.
Peter: Couple of questions from my side I remain a little bit bustle from the U S market.
Speaker Change: <unk> growth for the auto business. So if you.
Speaker Change: Yes.
Speaker Change: Because you say we have a name.
Speaker Change: Could you explain that is that you put through the price investments.
Speaker Change: On table impactful change the sales mix.
Speaker Change: Or is it also that the volumes are down there that's the first question.
Speaker Change: But you closed down just off the shelf you also had the impact of.
Speaker Change: And on the consumer behavior.
Speaker Change: Is that kind of restocking at the consumers are stocking ahead of the trade tariffs coming in because of all my questions.
Speaker Change: The first direct assessment, which I thought had a positive impact on launch it so could you elaborate a little bit that part.
Speaker Change: And then coming back on the amendment for the Netherlands.
Speaker Change: Okay.
Speaker Change: On the first part of your question there in the back of your head that we had to stop and shop store closures.
Speaker Change: At home with $8 million.
Speaker Change: Second on your cash flow.
Speaker Change: Had an impact of around 100 basis points in Q1 in the U S net sales.
Speaker Change: And what could we expect that going forward because I saw the charts to a quite a bit in that form.
Speaker Change: And because we will count.
Speaker Change: And maybe to come back on the ask a question.
Speaker Change: Then we come to for that then we cannot follow you on mathematics.
Speaker Change:
Speaker Change:
Speaker Change: I thought you said in the call that you assume.
Nick: I welcome Nick on the grid.
Speaker Change: Yeah.
Speaker Change: Checking with the IR Department.
Speaker Change: This impact of coffee to be compensated.
Nick: We don't think that we are.
Speaker Change: No everything but this calculation we cannot follow.
Speaker Change: Yeah improvements in the rest of the business. So I still think that there's kind of three 8% margin for 2020.
Speaker Change: And the second thing is stocking up yes, there is quite some gladstone.
Speaker Change: Things questions, we get all the tariffs, let me be as explicit as we can be.
Speaker Change: We need to compare to with progress in Q4 of 'twenty three 'twenty four.
Speaker Change: We are in a total basis.
Speaker Change: Yeah.
Speaker Change: In our food business, 97% of our sales is food.
Speaker Change: So on the on the margin competition.
Speaker Change: And the central question for now.
Speaker Change: Mostly food is locally sourced locally procured.
Speaker Change: And indeed, we have not been maybe it completely.
Speaker Change: So that's why the fruit business is less vulnerable less exposed to tariffs that's one thing for.
Speaker Change: Hopefully to complete here.
Speaker Change: There are two elements, which are also not helping our margin first of all our online sales growth.
Speaker Change: For dose.
Speaker Change: Food items, which are important for example to the U S or two to the U S. In this case, we're talking about tariffs is a level playing field for everybody everybody and everybody is importing bananas than it is for everybody. The same level playing field. So that's also where our food business and our tariffs are not hitting food at heart.
Speaker Change: We grow double digit which is strategy and we're very proud about that number and it is of course.
Speaker Change: Our overall margin and the second thing is we also grow in pharmacy.
Speaker Change: And you have heard that before with other players.
Speaker Change: There's also diluting this too.
Speaker Change: Yolanda.
Speaker Change: We are not in general merchandise, we are not in non food, we not in discretionary items. So I think therefore less vulnerable and at the same time, we do not see that customers are stocking up.
Speaker Change: Of course, and thank you for the question setting on the pension settlement in our.
Speaker Change: For the quarter is 280 ranked it for pension settlement of which 205 is related.
Speaker Change: Products because they are afraid for.
Speaker Change: Or tariffs or.
Speaker Change: And the remainder is the remainder remaining parties at the balance sheet settlement.
Speaker Change: Or increases there.
The CPI in the northeast food at home is two 4%.
Speaker Change: And after 205 caching.
Speaker Change: We pay already 105 in 2024.
Speaker Change: You might you might expect some increase in food prices.
Speaker Change: <unk> $100 million.
Speaker Change: Okay.
Speaker Change: We have yet to come and factored into our guidance.
Speaker Change: Indirect effects might be there, but the thing that is at the moment speculation.
Speaker Change: Okay. Thank you.
Speaker Change: Your last question yes.
Speaker Change: Okay. Thank you very much.
Speaker Change: Like I said half of it.
Speaker Change: Thank you.
Speaker Change: Your next question comes from the line of work toys from BNP Paribas. Please go ahead.
Speaker Change: But we don't give you that guidance sorry.
Speaker Change: Sorry.
Speaker Change: You too.
Speaker Change: Concluded an apple or we will deliver Iraq.
Speaker Change: Hey, good morning, Thanks, very much for taking my question. So two on the U S. Firstly on the volume performance.
Speaker Change: Okay.
Speaker Change: Okay. Thank you.
Speaker Change: Youre welcome.
Speaker Change: Thank you.
Speaker Change: Inflation.
Speaker Change: Your next question comes from the line of Sweden for calling from UBS. Please go ahead.
Speaker Change: Underlying numbers my right in saying it looks like like for like volume was around 1% in the quarter and can you.
Speaker Change: Is it trending slowly opening up in the first five weeks of <unk> it would be great.
Speaker Change: Hi, good morning.
Speaker Change: Your line is JP.
Speaker Change: Great.
Speaker Change: And the second one is just on the U S margin should we think of the four 4% this quarter as a good level for the second quarter.
Speaker Change: Questions.
Speaker Change: It was a couple.
Speaker Change: Maybe.
Speaker Change: Thank you.
Speaker Change: A couple of times.
Speaker Change: Renee.
Speaker Change: And are you based on what you see today still happy that margin should be sort of flat in the second half of 2025 in the U S. Thank you.
Speaker Change: Okay. Good and then average pool person margin over the next four years.
Speaker Change: In that context is 2020 volume a year of investing.
Speaker Change: Yolanda dusk U S margin.
Speaker Change: Potentially below Paulson laws and if not why you called.
Speaker Change: Do you want to talk with us.
Speaker Change: Right.
Speaker Change: Yes, I can.
Speaker Change: To help you move.
Speaker Change: No we don't give guidance on a regional level, we are confident with the Q1 that we realize that we can deliver on the ambitions that we shared that we shared.
Speaker Change: Okay. Good.
Speaker Change: Beyond this year and then obviously get you back to at least folks and margin trajectory that you've enjoyed over the past few years.
Speaker Change: So that's the first one.
Speaker Change: We are driving very fast you know investing in price expanding our brands and we will see in the second half of the year that we will anniversary some of those price investments in the U S. Because we already started with them last year on the positive side I would say you see the volume online profitability, improving and the cost savings and on the negative side as we already indicate.
Speaker Change: Just very briefly go back to help food use margin comments you made.
Speaker Change: Within the year is there some phasing to be.
Speaker Change: For us to be thinking about.
Speaker Change: Glucose Tal.
Speaker Change: Some of US were trying to explore a bit more so if you could just help a little bit of that.
Speaker Change: Can you give us any.
Speaker Change: Is it a bit the sales mix.
Speaker Change: Yes.
Speaker Change: First off with the second half.
Speaker Change: Which is dilutive so all in all confident to realize the guidance that we've given for that for the year and Anniversarying. Some of those pricing fast men's in the U S. In the second half of the emphasis last year I think that is as much guidance that I can get I think Yolanda also on the rope as well.
Speaker Change: Maybe very lastly, sorry to squeeze one more in.
Speaker Change: Just in terms of run rate. This year I think you referred to a good start anything you can share in terms of penetration.
Speaker Change: This is Q4 run rate.
Speaker Change: Great.
Speaker Change: I think that.
Speaker Change: Good to hear you.
Speaker Change: Your guidance for the total company with all the elements like.
Speaker Change: Hi, guys.
Speaker Change: Okay.
Speaker Change: You asked us for almost weekly guidance as of our results.
Speaker Change: Like margin and the investments and the free cash flow in the mid high single digits with the $1000. I think is already in this time of uncertainty quite some quite some confidence so I think so.
Speaker Change: Okay.
Speaker Change: I appreciate the interest and curiosity.
Speaker Change: On the on the total plan, yes, CAGR of 4% growth, yes in average 4% margin.
Speaker Change: <unk>.
Speaker Change: We do of course I'll buildup in the company, but we don't.
Speaker Change: Okay.
Speaker Change: We gave the guidance too.
Speaker Change: We don't give guidance or reporting on segments or these kind of things.
Speaker Change: Jeff a little bit of flexibility.
Speaker Change: Over time, because we.
Speaker Change: It was also our first cloud question lesson that unlike flight <unk> sorry, yes.
Speaker Change: We would like to bring that growth.
Speaker Change: If you didn't break it down what does it mean for 2025.
Speaker Change: Yeah, I guess, just one more quickly if somewhat marginal.
Speaker Change: Previously given us an indication as to sort of the quarterly U S margin trajectory.
Speaker Change: Great.
Speaker Change: To share these kind of things, we just started the year.
Speaker Change: So third quarter and fourth quarter, I mean, just to give US an idea are we kind of are we round above a level you think it's going to be or.
Speaker Change: We started the year.
Speaker Change: Better than our 4% growth.
Speaker Change: At the beginning of the year so.
Speaker Change: Is there anything we should expect big changes from that.
Speaker Change: And a good start in 2025, so that's why the teams are ultra in the U S and also in Europe.
Speaker Change: Live live with the group guidance or margin.
Speaker Change: Okay.
Speaker Change: And then my other question was just you guys use volumes, Mike Health was about 1% positive in the quarter could you just confirm that's about right and then give us some idea where that's trending please and the first half of the second quarter. Thank you.
Speaker Change: Happy with that starts and let's not forget I mentioned that before.
Speaker Change: You cannot think about your strategy on the first one.
Speaker Change: Great.
Speaker Change: Did that.
Speaker Change: Starting up and ramp up earlier.
Speaker Change: Well, we already gave you all the information that we had four consecutive quarter in the U S pasta volumes and we would like to leave that there.
Speaker Change: And.
Speaker Change: And also in Europe, if you take the tobacco sales out we also grew in Europe.
Speaker Change: Fourth quarter to four 7% already and so that growth is coming I mentioned volume growth in both regions.
Speaker Change: And maybe the only thing you are a bit more forgiving that Nathan.
Speaker Change: The first insights in the second quarter I apologize.
Speaker Change: We work very hard to keep it like that so.
Speaker Change: We had a good start of the second quarter that that that can give as well.
Speaker Change: Let's see.
Speaker Change: Maybe talk to each other in the first quarter how that developed.
Speaker Change: And our teams working on volume our teams working on volume our CPG partners are super interested in volume. They also support with their trade funds and the promotional money to build the volume because it is an opportunity and a challenge for the total industry.
Speaker Change: In the beginning of this year.
Speaker Change: <unk>, we don't expect huge swings, we do things step by step and likes from that are we.
Speaker Change: The opportunity.
Speaker Change: Got it.
Speaker Change: Our second half of last year and two already <unk>.
Speaker Change: And but then I'll repeat myself as debt.
Speaker Change: So we're phasing and I get it.
Speaker Change: Strong position on the East Coast number one growth on the east coast and 80% of our sales we are number one and two in our DNA is so strong leadership positions there.
Speaker Change: Okay.
Speaker Change: A big move.
Speaker Change: Thank you both.
Speaker Change: Thank you we will now take this off line.
Speaker Change: Question for today.
Speaker Change: And that resonates well with our CPG partners good negotiation levels going on people drive try to drive volume private label sales is growing faster than non private label sales that also is driving volume so yeah.
Speaker Change: The final question.
Speaker Change: One of my themes stood out from <unk> Bank. Please go ahead.
Speaker Change: Hi, Good morning, and thank you for taking my question being the last I'm going to focus on Europe instead of the U S.
Speaker Change: Could you elaborate a bit on the building blocks for the improvement in margin in Q4, excluding <unk>.
Yeah, I would be disappointed.
Speaker Change: In the second quarter, we will not report volume growth, but we.
Speaker Change: We had a good start of this quarter.
Speaker Change: You just end up.
Speaker Change: But in terms of Martin of different countries Europe.
Speaker Change: Thank you.
Speaker Change: Thank you we will now take our final question for today.
Speaker Change: You provided with the logical.
Tom: Tom This is royalties thank you.
Speaker Change: Final question comes from the line of suite on my own colleagues from UBS. Please go ahead.
Speaker Change: Yeah.
Speaker Change: Thank you for that thank you for that.
Speaker Change: So for focusing on Europe, because we are quite tired of how are you.
Speaker Change: Hi, good morning, Thanks for taking my questions.
Speaker Change: Well, maybe just to build on the U S position.
Speaker Change: Teams are indeed the following.
Speaker Change: And in the European margin is coming from the Belgium future plan I mean, we.
Speaker Change: I think you've talked about getting up to 40% of the price investments completed in stock on shelf Upfronts earlier.
Speaker Change: In the Belgium transition the 100 and trade 28 stores are now affiliated and they out they are outperforming the base.
Speaker Change: Should we expect you to complete that repositioning in 2025.
Speaker Change: And can you give us an idea where you are with giant fleets on the same sort of 40%.
Speaker Change: As we had in recovering market share.
Speaker Change: And then we had we are now at a level of market share that is higher than before we started the plan. So you can really see that that intervention, which was heavy one is paying out and know and that margins.
Speaker Change: Benchmark, so far we've got to stop and shop. So that's the first one on the U S. Secondary funds you also referred to Sunday openings in Belgium.
Speaker Change: Is there any way you can help us in terms of quantifying, perhaps the Sunday openings impact you.
Speaker Change: Faster than we expected towards.
Speaker Change: <unk> segment level on the pump.
Speaker Change: Sockets that reset, but also of course, all the Titan had a tremendously well.
Speaker Change: And when should we expect that to.
Speaker Change: So we'll start Annualizing. Please.
Speaker Change: Q4 is the line very happy with the European performance and the Belgium future plan makes a difference.
Speaker Change: Thank you.
Speaker Change: Yes.
Speaker Change: So on the Sunday openings search radar.
Yolanda: Yolanda mentioned already delivered to <unk> and of course.
Speaker Change: It should almost annualized next quarter.
Speaker Change: Based on the rhythm of the franchised transition stores other than 28.
Speaker Change: <unk> got our closing of the project delivered later the plant.
Speaker Change: You mentioned.
Speaker Change:
Speaker Change: And.
Yolanda: Fair enough to see that the team's come very nicely together.
Speaker Change: It helps us a lot because the weekend it gets bigger in general in the industry. So as Sunday opening for.
Speaker Change: Good integration process of course.
Speaker Change: Six months more time to prepare that so we are super well prepared teams are now.
Speaker Change: 50% of your sales in Belgium, because the other 50% at already.
Speaker Change: Working on the synergies.
Speaker Change: Okay.
Speaker Change: Sunday openings, because they were already franchise as you might remember so it's helping us a lot on this also I think one of the reasons one of the good reasons plus the other things I mentioned earlier Nicole offer in a post of sales strength and a positive market share gain.
Speaker Change: This will be a great thing for our business in Romania complementarity of the business 3 billion sales more so.
Speaker Change: Thank you.
Speaker Change: It will show a good number to.
Speaker Change: To close off the last question.
Speaker Change: On the stop and shop that question in <unk> as we disclosed on the strategy day, we will invest $1 billion in the next four years and are going to get our strategy in the U S. That's an alternate stop and shop by the way. So we talk a lot back stop and shop at its not any stop and shop and 40% of stores that we already invested prices in that time.
Yolanda: And then I sound repetitive Yolanda.
Speaker Change: Okay.
Speaker Change: Our business in the U S is a 4% business our business in Europe is a 4% business and you will see that number in Europe, coming and you won't see us pushing that.
Speaker Change: Number in the U S. So let's.
Speaker Change: And thank you very much.
Speaker Change: The reality today.
Speaker Change: Refer to it as part of a multi year plan also for stop and shop. So we will be done market say in year four of our strategy and it probably is a continuous balancing again growth and margin because in the end. It's not margin we can bring to the bank. Its the euros into dollars. We earn so we find try and find that optimum there.
Speaker Change: For your tenants through the call.
Speaker Change: And.
Speaker Change: Speak to you.
Speaker Change: In the quarter one.
Speaker Change: Not that far from now we look forward. Thank you.
Speaker Change: Thank you. This concludes today's conference call thanks for participating.
Speaker Change: That's correct.
Speaker Change: Okay got it and then relative to that 40%.
Speaker Change: Are we in giant is that a number.
Speaker Change: How much have you completed in giant.
Speaker Change: For giant to just said.
Speaker Change: It's a little bit less programmatic as it is.
Speaker Change: Sure.
Speaker Change: So I'll stop and shop I managed you mentioned, a few things store fleet asset quality.
Speaker Change: Mentioned execution in stores I mentioned private rent the giant food is number one in.
Speaker Change: I suppose you referred to giant food and look to John's Company John's Company, Pennsylvania Giant food to you refer to most likely is Washington and Baltimore.
Speaker Change: The number one player there and the.
Speaker Change: The stores are in very good shape asset quality as grid.
Speaker Change: Store execution is super good supply chain on the produce side so.
Speaker Change: Ladies and gentlemen.
Speaker Change: There are more day to day management offering to be well.
Speaker Change: Good morning, and welcome to the Analyst Conference call on the full quarter of full year 'twenty 'twenty four results of ours that has a please note that this call is being webcast.
Speaker Change: Two we are well positioned for competition. So it's very comparable situation to stop <unk> shop, which is more from smoke emetic approach.
Speaker Change: Okay.
Speaker Change: During this call that has now anticipates, making projections and forward looking statements all statements other than statements of historical facts may be forward looking statements forward looking statements are subject to risks uncertainties and other factors that could.
Speaker Change: Thank you.
Okay.
Speaker Change: Thank you I will now hand, the call back for closing remarks.
Speaker Change: So everybody. Thank you very much for sticking to the two questions today with regards to <unk>.
Speaker Change: Good day and that May cause our actual results to differ materially from future results expressed or implied by such forward looking statements. Therefore, you should not.
Speaker Change: I will follow up with any of you who have missed on the call today around any follow up questions. The team is available and we look forward to seeing you at the many conferences over the next couple of months.
Speaker Change: Undue reliance on any of these forward looking statements.
Speaker Change: That's it for today and we'll be back again in August and good luck to the London Nurse 40, Arsenal again Tonight.
Speaker Change: The introduction will be followed by a Q&A session any views expressed asking questions on not necessarily the views of all of that.
Speaker Change: For those who support our structure.
Speaker Change: Alright, Thank you very much operator for your help.
Speaker Change: At this time I would like to hand, the call over to Jay PMA Route Senior Vice President head of Investor Relations. Please go ahead JP.
Speaker Change: Thank you that does conclude our conference for today. Thank you for participating you may now disconnect.
Speaker Change: Alright, Thank you very much Karen and good morning, everyone.
Speaker Change: Core to our 2024 results conference call.
Speaker Change: On today's call.
Speaker Change: Our president and CEO and Yolanda put spud our CFO. After a brief presentation, we will open the call for questions.
Speaker Change: Yeah.
Speaker Change: Good morning.
Speaker Change: Case, you Havent seen it the earnings release and the accompanying presentation slides can be accessed through the investors section of our website <unk> dot com.
Speaker Change: We oh delays.
Speaker Change: We operate in nine countries on three continents, we have 17 brands and well over 9400 stores and every day 393000 people work hard to serve over 72 million customers per week, you could say that we're a big company and yet.
Speaker Change: These are provided extra disclosures in detail.
For your convenience to ensure everyone has the opportunity to get their questions answered today.
Speaker Change: I ask that you initially limit yourself to two questions. That's two questions not fight for our questions and if you refer to questions and feel free to reenter the queue.
Speaker Change: All our efforts and to be small.
Speaker Change: To ensure ease of speaking all growth rates mentioned in today's prepared remarks will be at constant exchange rates, unless otherwise stated and.
Speaker Change: Because when you're small.
Speaker Change: You are part of your local community.
Speaker Change: You can customize stores on a local level and when you are small you can connect with the people who work with.
Speaker Change: Trends over to you.
Speaker Change: Thank you very much J J P and good morning, everyone.
Speaker Change: Reflecting on the year I am proud of all that we've accomplished.
Speaker Change: Small.
Speaker Change: Is it me.
Small means that we take the best local innovation and share them across the world.
Speaker Change: If I were to choose three works to summarize our year it would be commitment.
Speaker Change: Assistance C and clarity.
Speaker Change: From being first to bring the bar code from the rest of the Netherlands in the seventies, and introducing AI solutions to predict shelf life and limit food waste to being open for everyone and sharing values of passion for serving customers and a love for peanut butter, just not always with daily <unk>.
Speaker Change: Great.
Speaker Change: Staying true to our values to deliver for our customers every day and consistency is sticking to our clients realizing another year of strong underlying performance.
Speaker Change: And clarity being clear.
Speaker Change: We're heading as a company.
Speaker Change: Okay, let's continue.
Speaker Change: Our strategy.
Speaker Change: Small means understanding our responsibility to provide access to essential products. It's about realizing that everything that happens in society affects us our stores and our customers.
Speaker Change: Commitment starts with our people.
Speaker Change: Before has been a dynamic and disruptive year with a lot of to do lots of things to deal with inflation.
Speaker Change: Inflation volatility in commodities and supply chain.
Speaker Change: And that works both ways with every small step we take.
Speaker Change: Social and political tensions and fast paced changes due to new technologies, and how we work and how we live.
Speaker Change: <unk>.
Speaker Change: Helping customers to make better choices by gradually reducing salt sugar and fat from products.
Speaker Change: Creating value for customers catering to their local circumstances specific.
Speaker Change: <unk> healthier and more sustainable shopping basket.
Speaker Change: Working together with suppliers with farmers towards a more sustainable food system.
Speaker Change: Continued.
Speaker Change: Tangible differentiator for our business.
Speaker Change: Together, we inspire everyone E and live better healthier.
Speaker Change: And for this I would like to thank our associates for living our values and their dedication to our performance driven culture.
Speaker Change: A healthier future for people and planet.
Speaker Change: Yes.
Speaker Change: Moving to consistency this for me means sticking to our promises.
Speaker Change: Yeah.
Speaker Change: 2024, we said you could dependent on us for four weeks.
Speaker Change: Our relentless focus on the customer our price positioning.
Speaker Change: And leveraging the strength of our great local brands.
Speaker Change: Continued advancement of our own brand strategies, increasing penetration and category.
Speaker Change: Yes.
Speaker Change: It's fair to say, presumably if it's okay.
Speaker Change: Modernization of our organization to sustain growth.
Speaker Change: And as always continuing to be laser focused on cost control and cash flow to reinvest in our customers and our company.
Speaker Change: Okay.
Speaker Change: Looking at our scorecard, we were indeed, consistent and achieved or exceeded all of our key goals for the year.
Speaker Change: At the same time, we also had the room to kickstart several growing together initiatives, which will pave towards 2025.
Speaker Change: And finally clarity, which is ultimately the key to great execution.
Speaker Change: In May and June.
Speaker Change: Game plan.
Speaker Change: <unk> for the coming four years building on our core strengths.
Speaker Change: And looking with an open mind.
Speaker Change: Sure.
Speaker Change: Yeah.
Speaker Change: We have an ambitious growth plan.
Speaker Change: We want to grow faster than the industry maintaining.
Speaker Change: Margins.
Speaker Change: Tangible earnings growth.
Speaker Change: And I'm, particularly proud of how quickly our teams have stepped into a new strategy with several actions already well underway let.
Speaker Change: Let me share a few highlights in this respect.
The first area is investing in our winning customer value proposition.
Speaker Change: We want our customers to have vibrant experiences every time, they interact with our brands whether in store or digitally or at the intersection of the two.
Speaker Change: And we are elevating our digital solutions and also.
Speaker Change: Secret sauce through AI and predictive analytics.
Speaker Change: In Europe, and the U S. Our brands delivered 12 billion personalized offers for the year.
Speaker Change: The 1 billion increase compared to 2023.
Speaker Change: And we also announced a new partnership with Edmar intelligence on digital coupons to further improve offer types and savings.
Speaker Change: At alphabet to increase the modular E. Commerce platform was launched the final in a series of six launches across the European market.
Speaker Change: It's all about in the Czech Republic, the first Brent on the new <unk>.
Speaker Change: Earlier monthly App users have increased by over 20% and loyalty sales have increased nearly 10% compared to 2023.
Speaker Change: In tandem with our digital experiences. We also have been working hard on our assortment throughout the year and.
Speaker Change: Ensuring we offer the customer the freshest.
Speaker Change: <unk> products on the market at great competitors.
Speaker Change: Yes.
Speaker Change: In this respect strength.
Speaker Change: The assortment is key and we have a big ambition to increase own brand penetration over time to 45%.
Speaker Change: Our plan is a front runner in own brand execution.
Speaker Change: And then 2024.
Speaker Change: 150 owned brand products or product lines, where award winning.
Speaker Change: In consumer taste and quality elections.
Speaker Change: Our CSD brands made progress.
Speaker Change: Amortization, bringing an additional 500 programs.
Speaker Change: Are you at assortment differentiators to the right.
Speaker Change: These products also play a vital role.
Speaker Change: Increasing regional price favorites with all.
Speaker Change: Now, having a minimum of 825 fresh favorites in the everyday assortment.
Speaker Change: An increase of 15%.
Speaker Change: Back to 2023.
Speaker Change: In the U S. A major focus has been on raising awareness of own brand quality or price relatively to national brands and during the last quarter U S owned branch sales growth outpaced the rest of the store in both dollars and units.
Speaker Change: The next aspect I would like to.
Speaker Change: Today is the progress we are making.
Speaker Change: So <unk> and grow our markets.
Speaker Change: Prioritizing optimizing and sharpening up.
Speaker Change: You will see a more pronounced a rig rate.
Speaker Change: On growing customer reach and extend the leading positions.
Speaker Change: Most profitable markets.
Speaker Change: During our strategy day in May.
<unk> presented a clear view.
Speaker Change: Future potential of the U S brands in this respect.
Speaker Change: One of the most just a giant company, which is a regional presence local customer base and leading market positions, which is why I'm pleased about our new store opening of the branch in Philadelphia in December with two additional stores in the works for 2025.
Speaker Change: Additionally, 95% of the store fleet is now remodeled with the latest Florida.
Speaker Change: On the flip side, making necessary intervention instrument branch.
Speaker Change: It is an exchange or contributor to elevating.
Speaker Change: Our sales to.
Speaker Change: The successful completion of the Belgium future plan.
Speaker Change: Affiliation project and the closure of the identified underperforming stop and shop Okay.
Speaker Change: <unk> demonstrated our <unk>.
Speaker Change: <unk> ability to do so and with these projects behind US I will share next steps. The teams are focused on a little bit later.
Speaker Change: Next let's spend a moment on leveraging and lowering our cost base in an environment, where inflationary costs are a concern for many of them.
Speaker Change: Our brands remain proactive to ensure that essential items are affordable and where they can reach for every one.
Speaker Change: Yeah.
Speaker Change: This is fueled by our save for our customers program, where we are proud.
Speaker Change: See the top plants generating over one.
Speaker Change: 35 billion euros and cost savings in 2024.
Speaker Change: Okay.
Speaker Change: And always and although we always can better two things we did you read that.
Speaker Change: With respect our <unk>.
Speaker Change: Locations through our should cost models, and simplification, where we challenge ourselves to continually improve and magnify it best practices.
Speaker Change: Two good examples of simplification through collaboration from last year include for example in the U S.
Speaker Change: Began streamlining support brands into one of the less USA sport organization supporting all of our five local brands in a consistent and cost efficient manner.
Speaker Change: In the <unk> region. The brands have completed the first phase of a project.
Speaker Change: For standardized labor management, allowing for optimized store execution.
Speaker Change: Additionally.
Speaker Change: Commercial operations have been standardized across all the Skus <unk> brands, including one centralized data support.
Speaker Change: Consistent training across virus.
Speaker Change: Calendars for negotiations.
Speaker Change: This will also provide opportunities for coffee to leverage as we unlock synergies in the coming years.
Speaker Change: Finally, let me spend a moment on that.
Speaker Change: The entities and planet.
Speaker Change: While the environment, we operate in continues to evolve our roadmap.
Speaker Change: Maintenance commitment to support healthy communities and planet is unchanged.
Speaker Change: These topics remain key.
Speaker Change: Brazilians are a competitive advantage and align very closely with our values.
Speaker Change: Our brands continue to implement projects to promote healthy affordable food drive sustainable business practices, like reducing food waste and energy consumption and I'm sorry, Chris.
Speaker Change: <unk> inclusion in the workplace.
Speaker Change: <unk>.
Speaker Change: The local communities in which we operate.
Speaker Change: One such example is obtained in the Netherlands, it's focus on healthy and sustainable products has contributed significant.
Speaker Change: Two its growth in market share and customer loyalty.
Speaker Change: As a percentage of AUM.
Speaker Change: Stifel sales <unk> increased to close 200 basis points in 2010 before while the organic range and plant based assortment.
Brent: Hey, Brent.
Brent: Overtime Teva are extremely popular.
Brent: So in summary, as released 2024 behind there are lots of positives to leverage.
Brent: In 2025.
Brent: I will share a few of our plans for the year a little bit later, but now over to Linda to share her remarks and insights in our numbers.
Linda: Thank you, France, and good morning to everyone.
Linda: Great thing about being a grocery retailer is that we are constantly connected to our customers the personal and digital connections, we have with them and us.
Linda: In real time is a powerful asset when combined with the agility.
Linda: Intrapreneur, you'll spirit of our great local brands.
Linda: Through a steady and growing market shares strong relative brand strength. We can see we are doing the right things as customers choose to shop with us every day.
Linda: It sounds mentioned we are there.
Linda: With how we ended the year strong holiday sales. Thanks, Jay first of Assortments and shopping experiences that offered customers everything they need to celebrate the season.
Linda: On slide 18, and 19, we present, the key underlying numbers for the quarter and the full year to summarize.
Linda: Net sales grew 0.6% to $23 3 billion euro during the quarter.
Linda: 0.9% to $89 4 billion euro during the full year.
Linda: Sales benefited from positive comparable sales.
Linda: And store openings.
Linda: The end of tobacco sales in the Netherlands, the closure of underperforming stop onshore locations and the divestment of fresh direct impacted net sales growth by 2.1.
Linda: That percentage point for Q4 and full year respectively.
Linda: Online sales increased by five 8% in Q4, and three 5% for the full year.
Linda: The divestments.
Linda: That had a negative impact of 5.1 percentage points.
Linda: Water and six nine percentage points for the full year.
Linda: Excluding <unk>.
Linda: We saw double digit growth rates at many of our brands, including all the time and food Lion.
Speaker Change: Okay great.
Speaker Change: Operating margin for the quarter was four 1%.
Speaker Change: <unk> of 'twenty.
Speaker Change: Points. This is last year.
Speaker Change: Mainly due to lower nonrecurring items in the U S related to holiday grew us.
Speaker Change: Our full year underlying operating margin for 2024 plus 4.0%.
Speaker Change: Diluted underlying earnings per share was <unk> 69 cents for the quarter and to Europe.
Speaker Change: For the full year in line with our guidance.
Speaker Change: Operating income for the quarter was 607 million Euro <unk>.
Speaker Change: Presenting and I address operating margin of two 6%.
Speaker Change: I press results with 351 million euro or lower than the underlying results.
Speaker Change: <unk> related to an amendment and additional funding of the Dutch pension plan.
Speaker Change: The biggest change we have reduced our overall.
Speaker Change: Exposure and have eliminated the annual for liability in the noncash.
Speaker Change: Charges.
Yeah operating with.
Speaker Change: With $2 8 billion euro representing an <unk> operating margin.
Speaker Change: 0.1%.
Speaker Change: <unk> results were 824 million euro lower and the underlying results.
Speaker Change: Actually due to cost associated with the following elements.
Speaker Change: Transitional stores as part of the Belgium future plan, the closure of stop <unk> shop stores and the amendment.
Speaker Change: Additional funding of the Dutch pension okay.
Speaker Change: Let's take a trip.
Speaker Change: Our Q4 performance starting with revenues.
Speaker Change: For comparable sales.
Speaker Change: 4%, which includes a negative net impact.
0.1 percentage point from weather and calendar shifts.
Speaker Change: And a negative impact of 1.1 percentage point from the.
Speaker Change: Sales in the Netherlands.
Speaker Change: U S comparable sales.
Speaker Change: Positive net impact from calendar and weather.
Speaker Change: Points.
Speaker Change: In Europe, there was around three four percentage points negative net impact from tobacco and categories.
Speaker Change: Looking at the regional performance U S. Net sales were $13 9 billion euro comparable sales excluding gas Inc.
Speaker Change: One, 2%, excluding net weather and calendar impact.
Speaker Change: Reflecting growing positive comparable sales momentum and a return to positive volumes during the fourth quarter.
Speaker Change: And in addition to the calendar and weather impact net sales were impacted by the following.
Speaker Change: <unk> 110 basis points from the impact of stop and shop closures.
Speaker Change: Around 80 basis points from the second.
Speaker Change: Thanks, Brent or fresh direct.
Speaker Change: And around 25 basis points from a decline in Canada.
Speaker Change: Yes.
Speaker Change: Online sales growth.
Speaker Change: Okay.
Speaker Change: As for the impact of <unk> was a key highlight of the quarter customers are responding positively to our partnership with door dash.
Speaker Change: In our mind avoided accelerating with a 20% increase in number of orders in Q4 compared to Q3.
Speaker Change: Underlying operating margin in the U S was four 2%.
Speaker Change: In line with the third quarter.
Speaker Change: Margin performance year over year was impacted by.
Speaker Change: Recurring items guys.
Speaker Change: Investments at stop <unk> shop, the net unfavorable impact from a change in sales mix and wage inflation.
Speaker Change: In Europe fourth quarter trends were again strong.
Speaker Change: Net sales were $9 4 billion euros up two 4% despite being negatively impacted by two eight percentage points from the end of tobacco sales in the Netherlands.
Speaker Change: Excluding the impact of tobacco.
Speaker Change: Comparable sales increased four 7%.
Speaker Change: Like in the U S online sales growth comes from boost increasing by 10, 9%.
Speaker Change: And then operating margin in Europe was four 4% up 70 basis points. This was mainly driven by strong performance recovery in Belgium, and lower energy cost.
Speaker Change: We think it's important to appreciate the strong value creation, leading market position and.
Speaker Change: And opportunities being delivered by our European teams.
Speaker Change: All the time.
Speaker Change: Sixth consecutive year of strong growth.
Speaker Change: Expanding its market share.
Speaker Change: 7.7% supported by an increase in number of customers and greater loyalty among existing customers.
Speaker Change: In Belgium continues.
Speaker Change: Sure recovery following the transition of stores to the affiliate model with an improved net promoter score increase in number of customers and market share at year end, well above pre announcement levels.
Speaker Change: Finally, following a strong holiday period, but also an acceleration in sales Greg achieved an all time high in App users.
Speaker Change: And recognize its highest ever quarterly sales.
Speaker Change: This in combination with double digit.
Speaker Change: Advertising services.
Speaker Change: Our relentless focus on cost management drove the incremental increases in profitability.
Speaker Change: <unk> underlying EBITDA growing to 185 million up from $159 million year round.
Speaker Change: Yeah.
Speaker Change: Part of both competitive advantage.
Speaker Change: And market proposition, giving access to over 47000 sales partners.
Speaker Change: An example is that flourishing collaboration with leak out in addition to compelling holiday campaigns, which drove a 25% increase in legal sales. While also introduced a pop up legal shelf, which was a resounding success.
Speaker Change: <unk> pop up already planned for later this year in Belgium.
Speaker Change: Moving now to free cash.
Speaker Change: Okay.
Speaker Change: Q4 free cash.
Speaker Change: One 3 billion Euro, which represents an increase of $227 million.
Speaker Change: Oh <unk> okay.
Speaker Change: 1023.
Speaker Change: Looking at the full year, we realized a free cash flow.
Speaker Change: $2 5 billion Euro X CDI.
Speaker Change: For the year.
Speaker Change: Our net capital expenditure for the year was below our original guidance in part due to timing of certain projects shifted to 2025 like Atlanta distribution Center expansion.
Speaker Change: Okay.
Speaker Change: Yes.
Speaker Change: In CSD and delaying some remote.
Speaker Change: To calibrate more efficiently to our new strategy.
Speaker Change: With capital expenditure running slightly lower this strength of our underlying operations allowed us to take the opportunity to optimize our future pension obligations in the Netherlands with additional funding to the Dutch pension plan of 105 million Euro.
Speaker Change: To complete the picture on Slide 27, you can see our net debt bridge year on year, Despite Ron returning 2 billion euro to our shareholders.
Speaker Change: We're able to show a decline mainly due to healthy free cash flow levels, partially offset by the impact of foreign exchange rates on that debt.
Speaker Change: With these results I'm pleased to announce.
Speaker Change: Also to increase the dividend per share by six 4% for 2020.
Speaker Change: Two one year ago, and 17 cents per share.
We've also initiated.
Speaker Change: Julian Euro share buyback program for 2025 on December 30 last year.
Speaker Change: Finally, let me provide some insights in a healthy community and planets priorities.
Speaker Change: In 2024, the percentage of owned brand health.
Speaker Change: Sales was 52, 4%.
Speaker Change: This represents a step up of all Mike.
Speaker Change: It's going to come back to 2023.
Speaker Change: If we exclude the negative impact of around three five percentage points from the transition to Nutri score of 2.0 for our Dutch and Belgium brands.
Speaker Change: Total tons of food waste pet food sales was 35% lower than our 2016 baseline.
Speaker Change: This is a similar result as in 2023. However, it includes a negative impact of four percentage points.
Speaker Change: With data quality and measurement in the U S.
Speaker Change: In Europe performance improved.
Speaker Change: Is that closer collaboration with partners to increase food bank donations.
Speaker Change: We reduced our C O two emissions in our operations by 36% compared to our 2000.
Speaker Change: To baseline.
Speaker Change: Inventories went up 2% versus last year, driven by the installation of more sustainable refrigeration systems in the U S stores and an increased use of cleaner energy in Europe.
Speaker Change: Okay.
Speaker Change: Plastic packaging, we can report a 10% reduction comes back to 2021.
Speaker Change: Which is equal to a region.
Speaker Change: Yeah.
Speaker Change: Our brands were able to increase the percentage of.
Speaker Change: Clinical content and continued to implement initiatives to replace that.
Speaker Change: Paper or cardboard.
Speaker Change: As we move to our outlook for 2025, we have several levers at our disposal to navigate the environment.
Speaker Change: Using our leading together strategy and our growth model as a guide you can count on us to keep a steady pace as we accelerate new store openings and Remodels and prioritize and act to describe of price investments.
Speaker Change: We will enrich our omnichannel capabilities driving growth in customer loyalty and expanding our reach.
Speaker Change: Scalable technologies that have a proven and successful track record.
Speaker Change: At the same time, we will also be focused on integrating trophy, our 17th great local brands.
Ross: Hey, Ross.
Speaker Change: Thanks to our 2025 financials, you have to take into account.
Speaker Change: The integration will add around 3 billion euro in net sales.
Speaker Change: Diluted.
Speaker Change: Two our European margin in the first year, it will be offset by improvements in the rest of the EU region.
Speaker Change: Taking that Angela.
Speaker Change: <unk> expenses into account. This will result in a net neutral impact to underlying EPS performance and finally, adding profi impact our capital expenditure by around 150 million Euro which includes maintenance capex as well as planned.
Speaker Change: 100, new grocery stores.
Speaker Change: Okay.
Speaker Change: Reported.
Speaker Change: In 2025, there are also a few other specific factors you want to reflect in your expectations.
Speaker Change: Let's stop and shop store closures are estimated to have an impact.
Speaker Change: 550 and $575 million.
Speaker Change: That will be around a one percentage point impact on reported and comparable store sales in Europe due to the end of tobacco sales at all the times franchise locations in the Netherlands.
Speaker Change: Yes.
Speaker Change: Of the year.
Speaker Change: Due to the new regulations coming into force.
Speaker Change: In Belgium from April finished.
Speaker Change: Putting everything together for 2025 outlook, we expect an underlying margin of around 4%.
Speaker Change: Alluded earnings underlying earnings per share growth of mid to high single digit and a free cash flow of at least two 2 billion in Europe.
Speaker Change: Combined with the step up in our gross Capex to two.
Speaker Change: Seven 1 billion euros.
Speaker Change: As I said at strategy day.
Speaker Change: A lot to like about our plan for the coming years.
Speaker Change: 2025, it's balanced it's about growth, it's about industry, leading margins and our cost discipline, we are investing in the future and in cash generation, resulting in growing share.
Speaker Change: And we are not dependent on one element.
France: I can tell you is since we have multiple levers to deal with volatility in economic political or social contacts with that let me hand back to France to give you a flavor of our priorities for this year.
Thank you very much.
Speaker Change: Much of our success.
Speaker Change: Over the past year or so it comes down to doing that.
Speaker Change: It's got a good retail well while at the same time innovating for the future.
Speaker Change: Customers.
Positively to our actions with increasing engagements with our apps and loyalty programs and more frequently becoming omnichannel shoppers and with a growing preference for our own brand product.
Speaker Change: Surely Arps now is to continue to invest we're just winning formula.
Speaker Change: You can see our investments show that they build upon each other overtime and thus yielding compounding growth.
Speaker Change: For 2025, we will be doing for Keith thanks.
Speaker Change: Decelerating, new store openings and Remodels.
Speaker Change: Prioritizing, adding to the scope of price investments and.
Speaker Change: Enriching our omnichannel capability.
Speaker Change: And therefore drive the growth in customer loyalty and scaling technologies that have a proven and successful.
Speaker Change: Great.
Speaker Change: Our underlying operating margin guidance of around 4% and our gross capital expenditure.
Speaker Change: Sure.
Speaker Change: Round, two 7 billion euro.
Speaker Change: Reflective of this.
Speaker Change: Yes.
Speaker Change: We are ready to step up.
Speaker Change: Organic store growth.
Speaker Change: Modeling program in the U S on top of the giant company stores.
Speaker Change: Test stores this year, starting with the recent launch of a new food Lion and Tuchman North Carolina.
Speaker Change: We've also increased the pace of remodeling in the U S, including the resumption of Remodels at stop <unk> shop.
Speaker Change: In 2025, we will build on the good work of 24.
Speaker Change: And later in the first round of the planned 1 billion dollar price investments, we outlined from the payer for the period 2025 to 2028.
Speaker Change: All brands will make price investments throughout the year.
Speaker Change: To the local position and pricing strategies.
Speaker Change: In Europe, our teams in central and South Eastern Europe will be focused on the integration of Coffey.
Speaker Change: Appropriately we at over 17 hundreds of stores and we will serve an additional.
Speaker Change: But.
Speaker Change: <unk> customers.
Speaker Change: Yes.
Speaker Change: We'll continue to invest decisively and with focus on our strategic priorities across our regions also to capture more opportunities from technology and sustainability.
Speaker Change: Yeah.
Speaker Change: In Belgium, our teams will build on success for transformation.
Speaker Change: Further evolve our omnichannel proposition.
Speaker Change: For example by launching a new home shop Center poaching.
Speaker Change: On the path to profitability.
Speaker Change: And we also recently announced subject to regulatory approval the planned acquisition of gel food.
Speaker Change: Which includes 325, a bunch of shale.
Speaker Change: And we're just acquisition.
Speaker Change: We'll open new potential in the medium term.
Speaker Change: Right.
Speaker Change: Following convenient and space.
Speaker Change: And in terms of scaling.
Speaker Change: We will rollout S&P S forehead too.
Speaker Change: To our European brands to establish one.
Speaker Change: Global financial backbone and ramp up operations at our <unk> alone checkup in Romania.
Speaker Change: Which alongside our other data and tech teams will support the development of new digital data and tech capabilities.
Speaker Change: These examples demonstrate we have a clear plan for the year, we will continue to do so.
Speaker Change: Okay makes sense and at local where we can make the difference.
Speaker Change: Our guidance for 2025 is consistent with our.
Speaker Change: Ambitions, we are fully committed to realizing the growth opportunities of value creation that is ahead of us.
Okay.
Speaker Change: We are off to a good start for the year.
Speaker Change: Carrying the good momentum from the holiday season, and this gives us confidence for another good year for us.
Speaker Change: Communities and company.
Speaker Change: With that Sharon Please open the line for questions.
Speaker Change: Thank you to all.
Speaker Change: I'll ask a question you will need to press star one one.
Speaker Change: Telephone I'll wait for your name to be announced to withdraw your question.
Speaker Change: Please press star one.
Speaker Change:
Speaker Change: Please standby, while we compile the Q&A.
Speaker Change: Hello.
Speaker Change: Thank you we will now go to one last question.
Speaker Change: Well Mike.
Speaker Change: Please.
Speaker Change: And your first question comes from the line of Robert Jan Vos from ABN Amro O'day BHF. Please go ahead.
Speaker Change: Yes, hi, good morning, all and thanks for taking my questions.
Speaker Change: First one.
Speaker Change: Concerning your comments from profile.
Speaker Change: Europe is it fair to assume.
Speaker Change: Excluding <unk> you expect a roughly flat underlying EBIT margin of error of about right. Okay.
Speaker Change: Great set of core Europe in 2025.
Speaker Change: That's my first question and my second.
Speaker Change: A question.
Speaker Change: You started.
Speaker Change: And then stop and shop and this will continue in 2025.
Speaker Change: Can you elaborate a little bit on the first effects you've seen.
Speaker Change: The initial price investments.
Speaker Change: Thank you Tim.
Speaker Change: Yes. Thank you for your question.
Speaker Change: Yes.
Speaker Change: As you know, we don't give guidance on a on a regional level and for the next year, we turned around.
Speaker Change: Perfect.
Speaker Change: And like I said its strategy ultimately, we believe phase III and thoughtful percent plus.
Speaker Change: Great.
Speaker Change: And I have to leave it at that.
Speaker Change: And have a vaginal pressing investment U S.
Speaker Change: Yes.
Speaker Change: We are coming up.
Speaker Change: Drawing together a strategy.
Speaker Change: <unk> CAGR.
Speaker Change: 4% for the total period of sales CAGR.
Speaker Change: Average, 4% margin and of course, you don't fall.
Speaker Change: In January.
Speaker Change: Start with the plant so you prepare already.
Speaker Change: Mostly in the U S with price investment to already cater for growth and therefore, maybe not a surprise, but it's good to know that we had positive volumes in the U S in the fourth quarter.
Speaker Change: Sure.
Speaker Change: The first period of the year was a very positive theory.
Speaker Change: Also there we saw growth in volume.
Speaker Change: Of the total U S and we also saw effects positive effects stopper sure Brent Webb.
Speaker Change: And in price.
Speaker Change: And proposition in customer value and Brian.
Speaker Change: So we are very happy with the momentum and how we came out of the.
Speaker Change: Okay.
Speaker Change: The U S and we also can confirm that the machine.
Speaker Change: Optics for stop <unk> shop in the start of the year with the price investments, we already made and will make further ultra in the year and let's not forget.
Speaker Change: Thank you Mr for the strategy period.
Speaker Change: Seven 1 billion price investments.
Speaker Change: For the U S and we will also in the 'twenty 'twenty half year do those price investments across it.
Speaker Change: For our U S branch.
Speaker Change: Maybe to add to that France, if you look at stop <unk> shop Indeed.
Speaker Change: We started with very good idea of Rhode Island, why we at all the stores that Rhode Island to have reduced prices of Omega.
Speaker Change: Okay.
Speaker Change: The product so I think customers will really experience it and we are indeed happy that we have.
Speaker Change: The positive volume say those client investments at large it's not only stop and shop, we see a positive trend.
Speaker Change: Thank God.
Speaker Change: Yeah.
Speaker Change: Alright, thank you.
Speaker Change: Thank you.
Speaker Change: Okay.
Speaker Change: Then the question comes from the line of about <unk> <unk> from Morgan Stanley. Please go ahead.
Speaker Change: Hello, Good morning, and thank you for taking my questions.
Speaker Change: My first one is on coffee so you gave us.
Speaker Change: Good day.
Speaker Change: Okay.
Speaker Change: Hi, Matt.
Speaker Change: The actual locked up labs.
Speaker Change: So for example, where do you see the steady state margin.
Speaker Change: This post synergies what level of synergies do you have in mind.
Speaker Change: For example is the business breakeven today it would be good to understand.
Speaker Change: What do you.
Speaker Change: On the E Commerce business.
Speaker Change: 2025 gig.
Speaker Change: <unk> spent.
Speaker Change: And then my other question is just with New York mortgage.
Speaker Change: If we exclude the one offs it was down.
Speaker Change: Okay.
So is this a realistic run rate.
Speaker Change: Decline that we can expect for the first half.
Speaker Change: On the profit question and thank you for your question.
Speaker Change: Can you repeat your last question for me you, sorry, I lost track that.
Speaker Change: Proofing question that you asked over time.
Speaker Change: We do expect profit with the synergies that way.
Speaker Change: Thanks together.
Speaker Change: That profit will trend in line with the European margins are that we guide for for the other brands as well.
Speaker Change: On our current operating profit level, they are profitable, but as you are probably aware we intended to close the transaction last summer.
Speaker Change: So long as the synergies also take a bit longer so in the next year. We are now preparing for those synergies and they will dropping at the real synergy a payback will start in <unk>.
Speaker Change: Thanks.
Speaker Change: Could you repeat your second question. Please.
Speaker Change: Okay.
My second question was on the U S margin.
Speaker Change: If I look at the level of decline over Q4, excluding the one offs I guess it implies down 20.
Speaker Change: Which was in line with what you got.
Speaker Change: Okay.
Speaker Change: I was wondering is.
Speaker Change: The level of decline, we should expect over the cycle.
Speaker Change: The year before those price investments. Please go ahead.
Speaker Change: And the run rate.
Speaker Change: Yeah.
Speaker Change: Thank you for your question. Thank you.
Speaker Change: And Ed.
Speaker Change: As you know and we're sorry for that.
Speaker Change: Guidance on regional level for our margin service company.
Speaker Change: We will trend around.
Speaker Change: <unk>, 4%, but if you take away the one offs U S margin is expected to be stable.
Speaker Change: Thank you.
Speaker Change: Okay.
Speaker Change: Oh your dinner.
Speaker Change: Thank you.
Speaker Change: We will now go to the next question.
Speaker Change: And your next question comes from the line of William Wallace from Bernstein. Please go ahead.
William Wallace: Hi, good morning, Thanks for taking the question.
William Wallace: I can kind of pick up on the U S.
William Wallace: And I think there's a lot of nervousness about that.
William Wallace: Thinking about how quickly does the U S margins need to go down before it goes back up and I think I'm thinking about the comments you made around the <unk>.
William Wallace: Price investment.
William Wallace: Favorable mix of wage inflation impacting our margin.
William Wallace: The question is why don't they repeat again.
William Wallace: 25.
William Wallace: And then the second commodities.
William Wallace: Bigger picture question.
William Wallace: There's been changes at the FTC.
William Wallace: Yeah.
William Wallace: Changes in the U S.
William Wallace: M&A environment in the U S y.
William Wallace: Why did you take advantage of that emerge with program right.
William Wallace: Take care.
William Wallace: Yes.
Speaker Change: Thank you for your advice by the way in France will go into suggested manager if we look at that nervousness around the U S margin.
Speaker Change: I can understand that but keep in the back of your head we presented a growing to get a strategy, where we stated that we are going to invest in prices.
Speaker Change: The theory of a grading together strategy. So it is not a one off in 'twenty.
Speaker Change: Five.
Speaker Change: Sequencing those investments to get the best return, we can get and if you look at the whole year at the U S level, although we do not give guidance on a regional level margin. The margin also in the U S.
Speaker Change: You rather stable.
Speaker Change: For the full year.
Speaker Change: As a whole because we're balancing our investments and the upside that we're creating.
Speaker Change: And we've talked about it earlier I think you yolanda option in previous quarters.
Speaker Change: Sometimes we talk about.
Speaker Change: The margins in Europe, we see them.
Speaker Change: Now we've talked about the margins in the U S. We have a business where both regions.
Speaker Change: 4% margin companies and.
Speaker Change: Therefore also not a surprise that youll see in our growing together strategy, 4% margin coming back again.
Speaker Change: And we.
Speaker Change: We have to be always a 4% margin in the U S with won't don't want to change that.
Speaker Change: And we are are we covering two or 4% margin.
Speaker Change: So that gets some.
Speaker Change: Deviations with the Belgium business.
Speaker Change: Your suggestion and recommendation.
Speaker Change: This otherwise boring.
Speaker Change: You talked about Kroger.
Speaker Change: We always shared with you that.
Speaker Change: We are having an open view on expanding our business also.
Speaker Change: Okay directly when opportunities arise, which are in line with our strategy.
Speaker Change: And that's why you have seen Dell foods. That's why you have seen trophy in Europe, which is in.
Speaker Change: In line with strategy, giving us more strength in market as well.
Speaker Change: And also like in the past.
Speaker Change: Ts inorganic correctly.
Speaker Change: If doses fits our.
Speaker Change: Our strategy as such we have a strong balance sheets as you know so we have the firepower in itself, but we come back to you. If we have for sure to ideas on M&A in total.
Speaker Change: Thank you can I just clarify on the price investments.
Speaker Change: Three periods.
Speaker Change: Period.
Speaker Change: Great.
Speaker Change: I think you previously said that they would accelerate into the class of 2025, Keith do you still see them accelerating into 2025 from two inch core.
Speaker Change: Okay.
Speaker Change: Acceleration from 2024 into a growing together period, but the 1 billion that we talked today there is a sequence over the full going together period.
Speaker Change: And in 2025 years is also spread with branch through the year as well exactly.
Speaker Change: Thank you very much.
Speaker Change: Youre welcome.
Speaker Change: Thank you.
Next question.
Speaker Change: Fredrik <unk> from Jefferies. Please go ahead.
Speaker Change: Good morning.
Speaker Change: Right.
Speaker Change: Thank you.
Speaker Change: Taking my questions.
Speaker Change: And really if I could just understanding the moving.
Okay.
Speaker Change: The guidance.
Speaker Change: Yes.
Speaker Change: Around 4%.
Speaker Change: Oh God.
Speaker Change: Is that consistent.
Speaker Change: Both ends of the mid single digit to high single digit.
Speaker Change: Aps growth range.
Speaker Change: Which of the.
Speaker Change: Do you see.
Speaker Change: The bonds.
Speaker Change: Got it.
Speaker Change: Hum.
Speaker Change: Okay.
Speaker Change: So my question for.
Speaker Change: Free cash flow level.
Speaker Change: Right.
Speaker Change: Mid single digit EPS growth, we should be looking at $2 2 billion.
Speaker Change: A free cash flow or it's not an absolute.
Speaker Change: Well, if you kind of a high single digit do you think free cash flow you can.
Speaker Change: Thank you.
Speaker Change: Okay. Thank you for your questions.
Speaker Change: Yes, the margin of rainfall is Kansas City, the mid to high single digit earnings per share guidance that were given it's a combination of growth share buybacks and FX impact, which.
Speaker Change: For the year at current rates.
Speaker Change: And at least two printed.
Speaker Change: It is at least two points.
Speaker Change: Free cash flow that we are guiding on so that's the floor one could say hey would you also gave a nine.
Speaker Change: Free cash flow for the total strategy area too.
Speaker Change: And we at the beginning of the year. So we said at least two part two for 2025.
Speaker Change: It's.
Speaker Change: Driving forward.
Speaker Change: For February.
Speaker Change: And let's not forget that we also gave you a $2 7 billion Euro Capex number for this year.
Speaker Change: To take the necessary steps to bottleneck further our our assets to build stores and.
Invest further technical.
Speaker Change: So those things of course also fits together.
Speaker Change: Thank you very much.
Speaker Change: Okay.
Speaker Change: Your next question comes from the line of from.
Suva: From cabinets Suva. Please go ahead.
Speaker Change: Hello, Good morning substitute to taking my question.
Suva: Thank you Ricky.
Suva: Recovery.
Suva: Through all of your brands.
Suva: Okay.
Suva: Thank you.
Suva: Okay.
Suva: Underlying markets on my single question will deal, but it's public level are.
Suva: Hi.
Players or are you shipping some dry on frozen products from Europe. Thank you.
Suva: So the second question was do.
Suva: Do we find a red supplier base.
Suva: Private brand strategy issues is that your question.
Suva: Exactly.
Suva: Yes sure.
Suva: Yeah.
Suva: Let me let me take.
Speaker Change: We're taking a little bit broader because could request we get questions on tariffs as well we are in food retail.
Speaker Change: Very small number of our sales in general merchandize to start with footwear.
Speaker Change: Okay.
Speaker Change: And although we imported.
Speaker Change: A few things from Asia and Europe.
Speaker Change: This relatively small share and it's very much a level playing field for for.
Speaker Change: For the competitors, we compete with.
Speaker Change: But it is a very local business food. So the tariffs will not most likely not have there hasnt been a heavy impact on us.
Speaker Change: <unk>.
Speaker Change: Second thing was the element of surprise.
Speaker Change: Investments and therefore also volume growth, yes, we see volume growth in all our brands in the U S and as indicated before.
Speaker Change: We intentionally.
Speaker Change: <unk>, because we would like to deliver on our first year of growing together, which is a growth strategy as you know.
Speaker Change: And Thats why we started in the fourth quarter already with our preparations and we're also happy to see that also the start of the year.
Speaker Change: Four isn't.
Speaker Change: Very good start on growth and on volume.
Speaker Change: And so thats whats our plan. This was a promised we growing to grow our business and that's 4%.
Speaker Change: Total strategy period is for us also.
Targets to deliver on.
Speaker Change: Thank you very much.
Speaker Change: Thank you.
Speaker Change: Next question.
Speaker Change: Comes from the line of Simon on table from the golf credit to come Okay go ahead.
Speaker Change: Hey, guys. Good morning, it's been on the board.
Speaker Change: Okay.
Mike: Chris It's Mike.
Speaker Change: I remain a little bit Brussels on the U S margins.
Speaker Change: Because you say, we have a negative unfavorable impactful changes sales mix.
Speaker Change: But you closed down just off the shelf you also.
Speaker Change: Exactly.
Speaker Change: The first direct assessment with all had positive impact to launch it so could you elaborate a little bit on that part.
Speaker Change: And then coming back on the amendment for the Netherlands are used at home with $8 million.
Speaker Change: Hello.
Speaker Change: What could we expect that going forward, because I saw the charts quite bigger than that.
Speaker Change: And maybe to come.
Speaker Change: Come back on the last question on Europe.
Speaker Change: I thought you said in the call.
Speaker Change: If you assume.
Speaker Change: The dilutive impact of <unk> to be compensated by.
Speaker Change: Improvements in the rest of the business. So I still think that this.
Speaker Change: 0.8% margin for 2000.
Speaker Change: Do we need to compare to with progress in Q4 of 23 to 34.
Speaker Change: So on the on the margin composition in USA and the central question for now.
Speaker Change: And indeed, we have not been maybe it completely.
Speaker Change: Thank you.
Speaker Change: Two elements, which are also not helping out.
Speaker Change: Our online sales growth.
Speaker Change: So double digits, which is strategy and we're very proud about that number.
Speaker Change: Okay.
Speaker Change: To our overall margins and a check of thinking Israel to grow in pharmacy.
Speaker Change: And you have heard that before with other players in the U S and that is also dilutive.
Speaker Change: Yolanda the other things of course, and thank you for the question.
Speaker Change: Thank you.
Speaker Change: A settlement in our unusual for the quarter is 200 and ADT rounded for pension settlement of which 205 is cash related and the remainder is the remainder remaining part is the balance sheet settlement.
Speaker Change: Off the 205 cash impact we paid already 105 in 2024.
Speaker Change: Okay.
Speaker Change: 100 million is spread over the period to come expected in our guidance.
Speaker Change: Okay. Thank you.
Speaker Change: And your last question yes.
Speaker Change: Like I said I feel a bit repetitive, but we don't give that guidance.
Speaker Change: So it's up to.
Speaker Change: To conclude on a group level, we will deliver a wrongful descend.
Speaker Change: Okay. Thank you.
Speaker Change: Youre welcome.
Speaker Change: Thank you.
Speaker Change: Your next question comes from the line of Sweden, Mahwah Collie from UBS. Please go ahead.
Speaker Change: Hi, good morning.
Speaker Change: Okay.
Speaker Change: Thanks for taking my questions.
Speaker Change: It was a couple.
Speaker Change: Thank you.
Speaker Change: Having gone through Refered to growing together strategy a couple of times.
Speaker Change: Q&A, the folks and say, okay. Good and then average walks in margin.
Speaker Change: Yes.
Speaker Change: In that context is 2025.
Speaker Change: Investing E Patel.
Speaker Change: Potentially below book, then margin is that why you're calling out around to.
Speaker Change: To help you move towards the hoops and say okay.
Speaker Change: Beyond this year and then obviously get you back to at least folks and margin trajectory that you've enjoyed over the past few years. So that's the first one and secondly, if I can just very briefly go back to help reduce margin.
Speaker Change: Okay.
Speaker Change: Okay.
Speaker Change: Within the year is there some phasing to be.
Speaker Change: For us to be thinking about particularly close call.
Speaker Change: So that's where some of us were trying to explore a bit more so if you could just help a little bit.
Speaker Change: Give us a little bit of nice.
Speaker Change: Phasing.
Speaker Change: What's the second half.
Speaker Change: Maybe very lastly, sorry to squeeze one more in.
Speaker Change: Just in terms of run rate this year.
Speaker Change: Once you record the good stuff.
Speaker Change: Anything you can share in terms of current trading so club, perhaps versus Q4 run rate.
Speaker Change: Great.
Speaker Change: Good to hear you.
Speaker Change: Hi, guys.
Speaker Change: Got it.
Speaker Change: You asked us for almost weekly guidance as of our results.
Speaker Change: Okay.
Speaker Change: I appreciate the interest and curiosity.
Speaker Change: On the on the total plan, yes, a CAGR.
Speaker Change: Ralph Yes, an average 4% margin.
Speaker Change: We gave that guidance to.
Speaker Change: Jeff a little bit of flexibility.
Speaker Change: Over time, because we.
Speaker Change: We would like to bring that growth.
Speaker Change: If you didn't break it down what does that mean for 2025.
Speaker Change: Okay.
Speaker Change: To share these kind of things, we just started the year.
Speaker Change: We started the year.
Speaker Change: Better than our 4% growth.
Speaker Change: At the beginning of the year so.
Speaker Change: Yeah.
Speaker Change: A good start in.
Speaker Change: In terms of 25, so that's what the teams are ultra in the U S and ultra in Europe are quite quite happy with that start and let's not forget I mentioned that before.
Speaker Change: You can think about your strategy for the <unk>.
Speaker Change: First of January.
Speaker Change: Did that.
Speaker Change: Our ramp up earlier.
Speaker Change: And also in Europe, if you if you take the tobacco.
Speaker Change: We also grew in Europe in the fourth quarter four 7%.
Speaker Change: And so that growth is coming I mentioned volume growth in both regions.
Speaker Change: And we work very hard to keep it like that so.
Speaker Change: Let's see where we are.
Speaker Change: Okay.
Speaker Change: Quarter, how does that.
Speaker Change: Developed.
Speaker Change: In the beginning of this year the $3.
Speaker Change: Okay.
Speaker Change: Swings, we do things step by step and likes from Ziad.
Speaker Change: We have the opportunity because we had to get.
Speaker Change: Second.
Speaker Change: <unk> already turned towards a strategy. So we're phasing in and I don't expect big Big move.
Speaker Change: Okay.
Speaker Change: Thank you we will now take our final question for today.
Speaker Change: And the final question comes from the line of Maxim <unk> from <unk>.
Speaker Change: Please go ahead.
Speaker Change: Hi, Good morning, and thank you for taking my question being the last I'm going to focus on Europe instead of the U S.
Speaker Change: Could you elaborate a bit on the building blocks for the improvement in margin in Q4, excluding bullet with different <unk> and Delta.
Speaker Change: In terms of margins in the different countries Europe and intervention.
Speaker Change: You provided with the <unk>.
Speaker Change: The light on this as well please thank you.
Speaker Change: Yeah.
Speaker Change: Thank you for that thank you for the question and answer for focusing on Europe, because we are quite tired of highlight European teams are indeed performing.
Speaker Change: Bringing in and the European margin is coming from the Belgian future plans I mean.
Speaker Change: The of course investors.
Speaker Change: In Belgium, a transition the 120.
Speaker Change: 28 schools are now affiliated and they out.
Speaker Change: Performing the business cases, we had in recovering market share.
Speaker Change: We are now at a level of market share that is higher than before we started the plan. So you can really see that that intervention, which both had anyone is banging out and know and that margins. Okay.
Speaker Change: Then we expect it towards.
Speaker Change: The targets that we set but also of course, all the Titan had a tremendously well.
Speaker Change: Q4 <unk>.
Speaker Change: Is it the line very happy with European performance, and the Belgium future plan makes a difference.
Speaker Change: Yolanda mentioned already.
Speaker Change: And of course, we are.
Speaker Change: Got our closing of the project delivered late to the plant.
Speaker Change: What are your intentions, but it's very nice to see.
Speaker Change: <unk> come very nicely together.
Speaker Change: Good integration process of course.
Speaker Change: Got you explore more time to prepare that so we are super well prepared schemes are now.
Speaker Change: Working on the <unk> and <unk>.
Speaker Change: I'm quite confident that this will be a great thing for our business in Romania.
Speaker Change: So if the business 3 billion sales more so.
Speaker Change: A year ago.
Speaker Change: A good number.
Speaker Change: To close off this the last question.
Speaker Change: And then I sound repetitive here.
Speaker Change: But our business in the U S is a 4% business our business in Europe to support.
Speaker Change: You will see that number in Europe coming.
Speaker Change: You will see us losing that number into the U S. So.
Speaker Change: And thank you very much for your curiosity today and.
Speaker Change: And for your attendance.
Speaker Change: Okay.
Speaker Change: Speak to you in the in quarter one.
Speaker Change: So not that far from now we look forward. Thank you take care.
Speaker Change: Thank you this concludes.
Speaker Change: Conference call. Thanks for participating you may now disconnect.
Speaker Change: Ladies and gentlemen, good morning, and welcome to the Analyst Conference call on the fourth quarter.
Speaker Change: <unk> 24, a result of all that has a note.
Speaker Change: With being webcast unrecorded Julien with cool.
Speaker Change: <unk> anticipates may contain projections and forward looking statements.
Speaker Change: Statements over than statements of historical facts may be forward looking.
Speaker Change: Okay.
Speaker Change: Forward looking statements are subject to risks uncertainties and other factors that are difficult to predict and that may cause our actual results to differ materially from future results expressed or implied by such forward looking statements. Therefore, you should not place undue reliance on any of these forward looking statements.
Speaker Change: The introduction will be followed by a Q&A session.
Speaker Change: He has expressed by those asking questions on not necessarily the views.
Speaker Change: That has a.
Speaker Change: At this time.
J.P.: On the call over to J P. <unk> senior Vice President head of Investor Relations. Please go ahead JP.
J.P.: Alright, Thank you very much Sharon and good morning, everyone I'm delighted to welcome you all to our 2024 results conference call.
Speaker Change: On today's call are friends motor, our president and CEO and Yolanda inspired our CFO.
J.P.: After a brief presentation, we will open the call for questions.
J.P.: In case, you haven't seen it the earnings release and the accompanying presentation slides can be accessed through.
J.P.: The investors section of our website at <unk> Dot com.
J.P.: These are.
J.P.: Extra disclosures in detail.
J.P.: Convenience.
J.P.: To ensure everyone has the opportunity to get their questions answered today.
J.P.: Okay.
J.P.: So two questions. That's two questions not five prior questions and if you've further questions then feel free to re enter the queue.
J.P.: Okay.
Speaker Change: All growth rates mentioned in today's prepared remarks will be at constant exchange rates, unless otherwise stated and without friends over to you.
J.P.: Thank you.
Speaker Change: J P and good morning, everyone.
J.P.: Reflecting on the year I'm proud of all that.
J.P.: Accomplished if.
J.P.: If I were to choose three works to summarize our year it would be commitments consistency and clarity.
J.P.: Commitment is staying true to our values to deliver for our customers every day and consistency.
J.P.: Looking to our plants, realizing another year of strong underlying performance.
J.P.: And clarity being clear on where we are heading as a company through our growing together strategy.
J.P.: Yeah.
J.P.: Quick starts.
J.P.: It starts with our people.
J.P.: 2024 has been dynamic and disruptive year with a lot of to do lots of things.
J.P.: Inflation volatility in commodities and supply chain Soc.
J.P.: Social and political tensions as fast paced changes due to new technologies, and how we work and how we live.
J.P.: Creating value for customers okay.
J.P.: Catering to the local circumstances and a specific niche.
J.P.: To get tangible.
J.P.: Now for our business.
J.P.: And for this I would like to thank our passionate associates for living our values and their dedication.
J.P.: Okay.
Speaker Change: David culture.
Speaker Change: Moving to consistency. This for me means sticking to our performances in 2024, we said you could depend on us for four things.
Speaker Change: Our relentless focus on the customer our price positioning.
Speaker Change: Leveraging the strength of our great local brands.
Speaker Change: Continued advancement of our own brand strategies, increasing penetration and category.
Speaker Change: Fair enough severity for simplification and modernization of our organization to sustained growth and as always continuing to be laser focused on cost control and cash flow to reinvest in our customers and our company.
Speaker Change: Looking at our scorecard, we were indeed, consistent and achieved or exceeded all of our key goals for the year.
Speaker Change: At the same time, we also had the room to kickstart several growing together initiatives, which will pave towards 2025.
Speaker Change: And then finally clarity, which is ultimately the key to great execution.
Speaker Change: In May and June we crystallized our game plan.
Speaker Change: Provisions for the coming four years building.
Speaker Change: And looking with an open mind to the future.
Speaker Change: This growth plan, where we want to grow faster than the industry, maintaining leading margins and deliver sustainable earnings growth.
Speaker Change: And empathy.
Speaker Change: How quickly our teams have stepped into a new strategy with several actions already well underway.
Speaker Change: Let me share a few highlights.
Speaker Change: We expect.
Speaker Change: First area is investing in our winning CVP the customer value proposition.
Speaker Change: We want our customers to have vibrant experiences every time, they interact with our brands whether in store or digitally or at the intersection of the two.
Speaker Change: To that end, we are elevating our ticket.
Speaker Change: And also adding some secret sauce through AI and predictive analytics.
Speaker Change: And in the U S. Our brands delivered 12 billion Personalised offers for the year.
Speaker Change: 1 billion increase compared to 2020.
Speaker Change: And we also announced a new partnership with <unk>.
Speaker Change: On digital coupons.
Speaker Change: Further improve offer types and savings.
Speaker Change: At a.
Speaker Change: To increase the modular E Commerce platform was launched the <unk>.
Speaker Change: Finally, a series of six launches across the European market.
Speaker Change: At Albertina, Czech Republic, the first Brent on the new <unk> earlier monthly.
Speaker Change: <unk> increased by Ofer.
Speaker Change: And loyalty sales have increased nearly 10% compared to 2023.
Speaker Change: In tandem with our digital experiences we also have been working hard.
Speaker Change: Sure print throughout the year.
Speaker Change: Ensuring we offer the customer the freshest healthiest products on the market at great competitive prices.
Speaker Change: In this respect strengthening home Brent assortment is key and we have a big ambition to increase own brand penetration over time to 45.
Speaker Change: Yeah.
Speaker Change: Our <unk> as a front runner in on Brent execution and in 2024.
Speaker Change: 51 brand products and product lines, where award winning in consumer taste and quality elections.
Speaker Change: Our CSD brands.
Speaker Change: On the product harmonization, bringing an additional 500 products, both price value and assortment differentiators to the rich.
Speaker Change: These products also play a vital role in increasing regional price favorites with all the CSE brands now having a minimum of eight.
Speaker Change: 25 press favorites in the everyday assortment.
Speaker Change: He is an increase of 15%.
Speaker Change: <unk> to 'twenty to 'twenty two.
Speaker Change: In the U S. A major focus has been on raising the awareness of own brands quality and price.
Speaker Change: Relatively to national brands and during the last quarter U S owned branch sales growth outpaced the rest of the store in both.
Speaker Change: And units.
Speaker Change: The second aspect I would like to highlight today is the progress we are making to densify and grow our markets by prioritizing optimized.
Speaker Change: Sharpening our portfolio you will see a more pronounced a rigorous process.
Speaker Change: Growing customer reach and extending leading positions in our most profitable markets.
Speaker Change: Jewelry bring our strategy day in May J, J presented a clear view for the future potential of the U S brands in this respect.
Speaker Change: One of those is a giant company, which is a regional presence local customer base and leading market positions.
Speaker Change: This is why I'm pleased about our new store opening a branch in Philadelphia in December with two additional stores in the works for 2025.
Speaker Change: Additionally, 95% of the store fleet is now remodeled with the latest Florida Zion.
Speaker Change: On the flip side, making necessary interventions from a branch are challenged is an essential contributor too.
Speaker Change: The quality of our sales.
Speaker Change: The successful completion of the Belgium future plan.
Speaker Change: Project and the closure of the identified underperforming stop and shop locations demonstrated our company's ability to.
Speaker Change: And with these projects behind US I will share next steps. The teams are focused on a little bit later.
Speaker Change: Next let's spend a moment on leveraging and lowering our cost.
Speaker Change: In an environment where inflation.
Speaker Change: Concern for many households, our brands remain proactive to ensure that essential items are affordable and within reach for every wallet side.
Speaker Change: This is fueled by our save for our customers program, where we are proud that we exceeded our plans generating over one.
Speaker Change: Billion euros in cost savings in 2024.
Speaker Change: Okay.
Speaker Change: Although we always can do better to things, we do really well in this respect our fact based negotiations through our should cost models and simplification, where we challenge ourselves to continuously improve and magnify it best practices.
Two good examples of simplification through collaborations from last year include for example in the U S. The team began.
Speaker Change: Adding the support brands into one.
Speaker Change: <unk> USA support organization supported.
Speaker Change: Okay.
Speaker Change: <unk> brands in a consistent and cost efficient manner.
Speaker Change: It is.
Speaker Change: The brands have completed the first phase of a project to standardized labor management.
Speaker Change: We're optimized store execution.
Speaker Change: Additionally, commercial operations have been standardized across all the <unk> brands, including one centralized data supporting <unk>.
Speaker Change: Consistent training across Iris and aligned calendars for negotiations.
Speaker Change: This will also provide opportunities for coffee to leverage as we unlock synergies in the coming years.
Speaker Change: He.
Speaker Change: Spent a moment on healthy communities and planet.
Speaker Change: While the environment, we operate in continues to evolve our role and commitment equipment to support healthy communities and planet is unchanged.
Speaker Change: These topics remain key for long term business resilience are a competitive advantage and align very closely with our values.
Speaker Change: Our brands continue to implement projects to promote healthy.
Speaker Change: Driving sustainable business practices.
Speaker Change: Food waste and energy consumption.
Speaker Change: And encourage diversity and inclusion in the workplace.
Reflecting our respecting the local communities in which we operate.
Speaker Change: One such example is our paint in the Netherlands, it's focus on healthy and sustainable products has contributed significantly to its growth in market share and customer loyalty.
Speaker Change: That percentage of owned rent healthy food sales.
Speaker Change: <unk> increased.
Speaker Change: 200 basis points in 2010 before while the organic range and plant based assortment the Brent.
Speaker Change: Overtime.
Speaker Change: Our extremely popular.
Speaker Change: So in summary, as released 2024 behind.
Speaker Change: There are lots of positives to leverage.
Speaker Change: In 2025.
Speaker Change: I will share a few of our plans for the year a little bit later, but now overdue yolanda to share her remarks and insights in our numbers.
Yolanda: Thank you, France, and good morning to everyone.
Yolanda: Great thing about being a grocery retailer is that we are constantly connected to our customers personal and digital.
Yolanda: We have with them understanding their needs in real time is a powerful asset and combined with the agility.
Yolanda: Proprietary all spirit of our great local brands.
Yolanda: Through a steady and growing market shares strong relative brand strength. We can see we are doing the right things as customers choose to shop to shop with US every day.
Frans: As Frans mentioned we are.
Frans: With how we ended the year strong holiday sales, thanks, Jay first of Assortments and shopping experience.
Frans: And often customers everything they needed to celebrate the season.
Frans: On slide 18, and 19, we present, the key underlying numbers for the quarter and the full year to summarize.
Frans: Net sales grew 0.6% to 23.
Frans: Billion euro during the quarter and 0.9% to $89 4 billion in Europe during the full year.
Frans: That's it from positive comparable sales ex gas and store openings.
Frans: Tobacco sales in the Netherlands, the closure of underperforming stop onshore locations and the divestment of fresh direct impacted net sales growth by two.
Frans: One seven percentage points.
Frans: Q4, and full year, respectively.
Frans: Online sales increased by five 8% in Q4, and three 5% for the full year.
Frans: The divestment of fresh didact had a negative impact of 5.1 percentage points for the quarter and $6 nine percentage points for the full year.
Frans: Excluding fresh direct with low double digit growth rates at many of our brands.
Frans: All the time and food Lion.
Frans: Underlying operating margin for the quarter was four 1%.
Frans: Greece of 20 basis points versus last year, mainly.
Frans: Mainly due to lower nonrecurring.
Frans: In the U S related to holiday accruals.
Frans: Full year underlying operating margin for 2024 was 4.0%.
Frans: Diluted underlying earnings per share was <unk> 69 cents for the quarter and two euros 54 cents for the full year in line with our guidance.
Frans: Our operating income for the quarter was 607.
Frans: Euro representing an ire, France operating margin of two 6%.
Frans: I have read results with $351 million euro lower than the underlying resales largely related to an amendment and additional funding of the Dutch pension.
Frans: With me this change we have reduced our overall pension risk this year.
Frans: And have eliminated the annual variability in the noncash service charges.
Frans: For the full year.
Frans: <unk> income was $2 8 billion.
Frans: Representing an <unk> operating margin of three 1%.
Frans: <unk> results were 824 million Euro Aloha.
Frans: And results largely due to cost associated with the following elements.
Frans: The transition of stores as part of the Belgium future plan.
Frans: Sure I'll stop and shop stores, and the amendment to <unk> additions.
Frans: Of the Dutch pension plan.
Frans: Let's take a closer look at our Q4 performance starting with revenues.
Frans: For comparable sales with 1.4%, which includes a negative net impact of 0.1 percentage point.
Frans: And calendar shifts.
Frans: And a negative impact of 1.1 percentage point from the end of tobacco sales in the Netherlands.
Frans: U S comparable sales showed a positive.
Frans: Any impact from calendar and weather of 20 basis points.
Frans: In Europe, there was a ranked three four percentage points negative net impact from tobacco and.
Frans: Okay.
Frans: Looking at the regional performance.
Frans: Net sales were $13 9 billion euro.
Frans: Comparable sales, excluding gas increased one 2%, excluding net weather and calendar impact.
Frans: Reflect.
Frans: Positive comparable sales momentum and a lead.
Frans: But if volumes during the fourth quarter.
Frans: In addition to the calendar weather impact net sales were impacted by the following.
Frans: Around 100.
Frans: Basis points from the impact of stop and shop closures.
Frans: Around 80 basis points from divestment of fresh direct.
Frans: And around 25 basis points from a decline in gasoline sales.
Frans: Alright.
Speaker Change: So $10, 9% adjusted for the impact of fresh direct was a key highlight of the quarter customers are responding positively to our partnership with door Dash. We continue to see an amount of orders accelerating with a 20% increase in number of orders in Q4 compared to Q3.
Speaker Change: Underlying operating margin in the U S was four 2% in line with the third quarter.
Speaker Change: The margin performance year over year was impacted by lower nonrecurring items price investments at stop <unk> shop, and net unfavorable impact from a change in sales mix and wage inflation.
Speaker Change: In Europe fourth quarter trends were again strong net sales were $9 4 billion euros up two.
Speaker Change: 4%, despite being negatively impacted by two eight percentage points.
Speaker Change: End of tobacco sales in the Netherlands.
Speaker Change: Excluding the impact of tobacco and calendar shifts comparable sales increased four 7%.
Speaker Change: Like in the U S online sales growth was robust increasing by <unk>.
Speaker Change: 9%.
Speaker Change: Underlying operating margin.
Speaker Change: Four 4% up 70 basis points. This was mainly driven by strong performance recovery in Belgium, and lower energy costs.
Speaker Change: We think it is important to appreciate the strong value creation, leading market positions and opportunities being delivered by our European teams.
Speaker Change: All the time achieved its sixth.
Speaker Change: If you have strong growth further expanding its market share to 37.
Speaker Change: And supported by an increase in number of customers and greater loyalty among existing customers.
Speaker Change: In Belgium continues its strong market share recovery following the transition to the affiliate model with an improved net promoter score.
Speaker Change: The increase in number of customers and market share at year end well above.
Speaker Change: Yes.
Speaker Change: Okay.
Speaker Change: Finally, following a strong holiday period bull, so and accelerating.
Speaker Change: Sales Greg.
Speaker Change: An all time high in App users and recognize its highest.
Speaker Change #100: Quarter of sales.
Speaker Change #100: This in combination with double digit growth in advertising services and a relentless focus on cost management drove the incremental increases in profitability with full year.
Speaker Change #100: Your line EBITDA growing to 185 million.
Speaker Change #100: From 159 million year round.
Speaker Change #100: Part of both competitive.
Speaker Change #100: Is it the divested market proposition, giving access to over 47000 sales partners.
Speaker Change #100: An example is the flourishing collaboration with leak out.
Speaker Change #100: In addition to compelling holiday campaigns, which drove a 25% increase illegal sales will also introduced a pop up legal shop, which was a resounding success. The second BOP up already planned for later this year in Belgium.
Moving now to free cash flow Q.
Speaker Change #100: Q4, okay.
Speaker Change #100: One 3 billion, which represents an increase of 227 million euro compared to Q4 2023 looking.
Speaker Change #100: Looking at the full year, we realized a free cash flow of over $2 5 billion euro exceeding our guidance of the year.
Speaker Change #100: Our net capital expenditure for the year was below our original guidance in part due to timing of certain drugs.
Speaker Change #100: Shifting to 2025 like Atlanta distribution center expansion football.
Speaker Change #100: Slowest store Rollouts in CSD and delaying some remodels in the U S to calibrate more efficiently 200, new strategy.
Speaker Change #100: Capital expenditures are running slightly lower.
Speaker Change #100: Underlying operations allowed us to take the opportunity to optimize our future.
Speaker Change #100: Obligations in the Netherlands with additional funding to the Dutch pension plan of 105 million Euro.
Speaker Change #100: To complete the picture on them.
Speaker Change #100: Seven you can see our net debt bridge year on year. Despite run returning 2 billion euro to our shareholders.
Speaker Change #100: We're able to show a decline mainly due to healthy free cash flow levels, partially offset by the impact of foreign exchange rates on that debt.
Speaker Change #100: With this please.
Speaker Change #100: Pleased to announce a proposal to increase the dividend per share by six.
Speaker Change #100: 4% for 2024 to one euro and 17 cents per share.
Speaker Change #100: We've also initiated the 1 billion Euro share buyback program for 2025 on December 30 last year.
Speaker Change #100: Finally, let me provide some insights in our healthy community and planets priorities in.
Speaker Change #100: In fact 24 the percentage of AUM.
Speaker Change #100: Okay.
Speaker Change #100: <unk> was 52, 4%.
Speaker Change #100: This represents a step out of almost one percentage point compared to 2023, if we exclude the negative impact of around three five percentage points from the transition.
Speaker Change #100: Score 2.0 for our Dutch and Belgium brands.
Speaker Change #100: Total tons of food waste pet food sales was 35%.
Speaker Change #100: 2016.
Speaker Change #100: <unk>.
Speaker Change #100: This is a similar result as in 2023. However, it includes a negative impact of four percentage points from improved data quality and measurement in the U S.
Speaker Change #100: In Europe performance improved driven by closer collaboration with partners to increase food bank donations.
Speaker Change #100: We reduced our C O two emissions in our own operations by 36% compared to 2019.
Speaker Change #100: <unk> an improvement of 2%.
Speaker Change #100: This last year, driven by the installation of more sustainable refrigeration systems in the U S stores and an increased use of clean energy in Europe.
Speaker Change #100: For Virgin own brand plastic packaging, we can report a 10% reduction.
Speaker Change #100: Back to 2021.
Speaker Change #100: Richard just equal to a reduction last year.
Speaker Change #100: Oh brands, we're able to increase the percentage of recycled content and continues.
Speaker Change #100: And initiative to replace bested packaging with paper or cardboard.
Speaker Change #100: As we move to our outlook for 2025, we have.
Speaker Change #100: Diseases at our disposal to navigate the environment.
Speaker Change #100: Using a gliding to get our strategy.
Speaker Change #100: Yes.
Speaker Change #100: You can count on us to keep a steady pace as we accelerate new store openings, and remodels and prioritize and add to the scope of price investments.
Speaker Change #100: We will enrich our omnichannel capabilities driving growth in customer loyalty and expanding our reach and scale technologies that happens.
And successful track record.
Speaker Change #100: At the same time, we will also be focused on integrating trophy.
Speaker Change #100: Local brand.
Speaker Change #100: Here are some of the impact to our 2025 financials you have to take into account.
Speaker Change #100: The integration will add around 3 billion euro in net sales.
Speaker Change #100: Dilutive impact to our European margin in the first year there'll be offset by improved.
Speaker Change #100: And the rest of the EU region.
Speaker Change #100: Taking net financially.
Speaker Change #100: Into our guidance. This will result in a net neutral impact to underlying EPS performance.
Speaker Change #100: Okay.
Speaker Change #100: I think trophy impact our capital expenditure by around 150 million Euro, which includes maintenance capex as well as plans to open around 100, new grocery stores.
Speaker Change #100: Okay.
Speaker Change #100: For our reported sales numbers in 2025, there are also a few questions.
Speaker Change #100: Factors you want to reflect in your expectations.
Speaker Change #100: This conference call.
Speaker Change #100: <unk> are estimated to have an impact.
Speaker Change #100: 550 and $575 million.
Speaker Change #100: That will be around a one percentage point impact.
Speaker Change #100: Comparable store sales in Europe due to the end of tobacco sales at all the times franchise location in the Netherlands.
Speaker Change #100: In the first half of the year as well as due to the new regulations coming into force in Belgium from April 1st.
Speaker Change #100: Putting everything together for a 2025 outlook, we expect an underlying margin of around 4%.
Speaker Change #100: Diluted earnings underlying earnings per share growth of mid to high single digit and a free cash flow of at least $2 2 billion euros.
Speaker Change #100: Combined with the step up in our gross Capex to $2 7 billion.
Speaker Change #100: And as I said at strategy day, Theres, a lot to like about it.
Speaker Change #100: And for the coming years, including 2025, it's balanced it's about growth, it's about industry, leading margins and our cost discipline, we are investing in the future and in cash generation, resulting in growing shareholder returns and we are not dependent on one element.
Speaker Change #100: Since we have multiple levers to deal with volatility.
Speaker Change #101: Political or social context, with that let me hand back to France to give you a flavor of our priorities.
Speaker Change #100: Yeah.
Speaker Change #100: Thank you very much.
Speaker Change #100: Much of our success over the past years comes down to doing the basics of good retail well while at the same time innovating for the future.
Speaker Change #100: Customers are responding positively to our actions with increasing engagements with our apps and loyalty program.
And more frequently becoming omni channel shoppers and with a growing preference for our own brand products.
Speaker Change #100: Surely Arps now is to continue to invest which is winning formula.
Speaker Change #100: Considering our investments shoulder to build upon each other overtime and thus yielding compounding growth.
Speaker Change #100: 75 will be doing for key thanks.
Speaker Change #100: Okay.
Speaker Change #100: Salaries cutting new store openings and Remodels.
Speaker Change #100: Prioritizing, adding to the scope of price investments.
Speaker Change #100: Enriching, our omnichannel capabilities, and therefore driving growth in customer loyalty and scaling technologies that have a proven and successful track record.
Speaker Change #100: Okay.
Speaker Change #100: Our underlying operating margin guidance of around 4% and our gross capital expenditure plans of around two 7 billion Euro.
Speaker Change #100: <unk> of these stocks.
Speaker Change #100: We are ready to step up our branch organic store growth and remodeling from the U S.
Speaker Change #100: On top of the giant company stores, we expect to open an additional 10 stores. This year started.
Speaker Change #100: The launch of a new food Lion.
Speaker Change #100: North Carolina.
Speaker Change #100: We've also increased the pace of remodeling in the U S, including the resumption of <unk>.
Speaker Change #100: Sure.
Speaker Change #100: In 2025, we will build on the good work of 24.
Speaker Change #100: And later in the first tranche of the planned 1 billion dollar price investments, we outlined from the payer for the period 2025 to 2028.
Speaker Change #100: All brands will make fresh investments throughout the year tailored to the local position and pricing strategies.
In Europe, our teams in central.
Speaker Change #100: Eastern Europe will be focused on the integration of Coffey and with trophy, we at over 1700 stores and we will serve an additional one.
Speaker Change #100: Customers on a daily basis.
Speaker Change #100: We will continue to invest decisively and with focus on our strategic priorities across the region also to capture more opportunities from technology and sustainability.
Speaker Change #100: In Belgium, our teams will build on the successful transformation by further evolving our omnichannel proposition.
Speaker Change #100: For example by launching a new home shop Center.
Speaker Change #100: e-commerce on the path to profitability.
Speaker Change #100: And we also recently announced subject to.
Speaker Change #100: With the approval the planned acquisition of gel food, which includes 325 point of sale and.
Speaker Change #100: And we're just acquisition the last one to open new potential in the medium term in the fast growing convenience space.
Speaker Change #100: And in terms of scaling our technologies, we will rollout S&P as for Hana to our European branch to establish one standardized global financial backbone and ramp up operations at our <unk>, Czech and Romania.
Which alongside our other data and tech team.
Speaker Change #100: We will support the development of new digital data and capabilities.
Speaker Change #100: These examples.
Speaker Change #100: A clear plan for the year, we will continue to build scale.
Speaker Change #100: And at local where we can make the difference.
Speaker Change #100: Our guidance for 2025 is consistent with our growing to get ambitions and we are fully committed to reinvest into growth opportunities and value creation that is ahead of us.
Speaker Change #100: I am pleased to say that we're off to a good start for the year.
Speaker Change #100: Carrying the good momentum.
Speaker Change #100: Holiday season, and this gives us confidence.
Speaker Change #100: Another good year for our brands communities and company.
Speaker Change #102: With that Sharon Please open the line for questions.
Speaker Change #103: Thank you to ask a question you will need to press star one one on your telephone and wait for your name to be announced to withdraw your question. Please.
Speaker Change #102: One one.
Speaker Change #102: Yeah.
Speaker Change #102: These dumbo, while we compile the Q&A lifestyle.
Speaker Change #102: Thank you we will now go to our first question.
Speaker Change #102: One moment please.
Speaker Change #104: So first question comes from the line of Robert Jan Vos from ABN Amro ODO BHF. Please go ahead.
Speaker Change #104: Yes, hi, good morning.
Speaker Change #104: Thanks for taking my questions.
Speaker Change #104: First one.
Speaker Change #104: Concerning your comments from pro fees.
Speaker Change #104: Is it fair to assume that's including Brophy you expect a roughly.
Speaker Change #104: Underlying EBIT margin of about three 8%.
Speaker Change #106: For Europe in 2025, so that's my first question and my second question.
Speaker Change #106: You've started to price investments that stope, which opened this will continue in 2025.
Speaker Change #106: Can you elaborate a little bit on the first effects you've seen.
Speaker Change #106: Those initial price investments.
Speaker Change #106: <unk>.
Speaker Change #106: Okay.
Speaker Change #106: Yes. Thank you for your question.
Speaker Change #106: John.
Speaker Change #106: As you know, we don't give guidance on a on a regional level and for the next year, we turned around 4% and like I said its strategy outbid V. We believe based regions, our 4% plus reagents and I have to leave it at that.
Speaker Change #106: And have a vaginal <unk> invested in the U S.
Speaker Change #106: Yes.
Speaker Change #106: We have communicated this growing together strategy.
Speaker Change #106: Okay.
Speaker Change #106: 4% for the total period of sales CAGR.
Speaker Change #106: On average, 4% margin and of course, you don't form Cliff in January.
Speaker Change #106: So you can prepare already.
Speaker Change #106: Mostly in the U S with price investment to already cater for growth and therefore, maybe not a surprise, but it's good to know that we had positive volumes in the U S in the fourth quarter and.
Speaker Change #106: First Ed.
Speaker Change #106: The period of the year was a very positive period to US also Dara we saw growth in volume for the total U S and we also saw positive.
Speaker Change #106: Effects with stop <unk> shop brands, where we invested in and pricing, but also a proposition and customer value and private brands at these kind of things. So we are very happy with the momentum how we came out of the fourth quarter for the total U S and we also can cause for.
Speaker Change #106: Positive upticks or shop in shop in the start of the year with the price investments, we've already made and will make further portion of the year and let's not forget that we set for the site.
Speaker Change #106: Have you said 1 billion price investments for.
Speaker Change #106: For the U S.
Speaker Change #106: Also the 2025 here.
Speaker Change #106: Do those price investments across the total year for our products.
Speaker Change #106: And maybe to add to that fronts, if you stop and shop Indeed.
Speaker Change #106: We started with very good guidance, Rhode Island, why we at all the stores, Rhode Island have reduced prices of almost 3500 product. So I think our customers will take it.
Speaker Change #106: And we are indeed happy that we ended with positive volumes out of those five investments at large it's not only stop and shop, we see a positive trend really paying out.
Speaker Change #106: Alright, thank you.
Speaker Change #106: Thank you.
Speaker Change #106: We will now take the next step.
Speaker Change #107: And the question comes from the line of is about <unk> <unk> from Morgan Stanley. Please go ahead.
Speaker Change #107: Good morning, and thanks for taking my question.
Speaker Change #107: My first one is on coffee.
Speaker Change #107: You gave us some disclosure.
Speaker Change #107: But could you comment on the actual long term labs.
Speaker Change #107: So for example, where do you see the steady state margin business those synergies and what level of synergies do you have in mind.
Speaker Change #107: For example is the business breakeven today it would be good to understand.
Speaker Change #107: What do you have in mind.
Speaker Change #109: Oh Dear.
Speaker Change #107: Yes.
Speaker Change #107: Beyond 2025, Guillermo you can see them.
Speaker Change #107: Mt.
Speaker Change #107: Hi.
Speaker Change #107: Second question is just on the U S margin.
Speaker Change #107: If we use.
Speaker Change #107: The one offs. It was down 20 bps I guess in Q4. So is this a realistic run rate a good level.
Speaker Change #107: Decline.
Speaker Change #107: Can we expect.
Speaker Change #107: Yeah.
Speaker Change #110: On the property question and thank you for your questions. You asked me if I repeat your last question for me you sorry, I lost track that.
Speaker Change #107: Proofing question that you asked overtime.
Speaker Change #107: We do expect profit with the synergies that we can realize together at that profit will trend in line with the European margins are that we guide for for the other brands as well.
Speaker Change #107: On our current operating profit level, they are profitable, but as you are probably aware.
Speaker Change #107: We intended to close the transaction last summer it took a bit longer so the synergies also take a bit longer so in the neck.
Speaker Change #107: We are now preparing for those synergies and they will dropping at the real synergy a payback will start in 2020.
Speaker Change #107: Could you repeat your second question. Please.
Speaker Change #107: Yep.
Speaker Change #107: My second question was on the margin.
Speaker Change #107: If I look at the level of decline over Q school excluded.
Speaker Change #107: I guess, it implies down 22 basis points, which was.
Speaker Change #107: You got to the call.
Speaker Change #107: So I was wondering is that the level of decline we should expect.
Speaker Change #111: Thanks, Paul.
Speaker Change #107: Year.
Speaker Change #107: Those price investments become annualized in the run rate.
Speaker Change #112: Thank you for your question and thank you for repeating it for us.
Speaker Change #112: As you know and we're sorry for that but we don't give guidance on regions.
Speaker Change #112: For our margin 70, <unk> company as a whole we will trend around 4%, but if you take the one offs U S margin is expected to be stable.
Speaker Change #112: Yeah.
Speaker Change #112: Thank you.
Speaker Change #112: Thanks.
Speaker Change #112: Oh, yeah yeah.
Speaker Change #112: Thank you.
Speaker Change #112: We will now go to the next question.
Speaker Change #113: And your next question comes from the line of William Wallace from Bernstein. Please go ahead.
William Wallace: Hi, good morning, Thanks for taking the questions.
William Wallace: I can kind of pick up on the U S margin again, I think there's a lot of nervousness about that especially when you're thinking about FY 'twenty five does the gross margin go down.
William Wallace: Okay.
William Wallace: And I think I'm thinking about the commentary that you've made around the impact of.
Speaker Change #114: Good afternoon.
Speaker Change #114: April mix of wage inflation impacting our margins in that space.
Speaker Change #114: Why don't they repeat.
Speaker Change #114: Thank you train five and then the second one is.
Speaker Change #115: Bigger picture question.
Speaker Change #114: There's been changes at the FTC has been.
Speaker Change #114: Changes in the.
Speaker Change #114: M&A environment in the U S.
Speaker Change #114: Why did you take advantage of that emerge with Kroger.
Speaker Change #114: Thanks, guys.
Speaker Change #114: Thank you for your advice by the way it will go into a suggested manager if we can't let that nervousness around the U S margin I can understand that but keep in the back of your head. We presented today growing to get a strategy, where we stated that we are going to invest.
Speaker Change #114: Mr <unk>.
Speaker Change #114: Over the period of our grain together strategies. So it's not a one off in 2025, it's you know sequencing gates investments to get the best return, we can get and if you look at the whole year at the U S level, although we do not give guidance on the region.
Speaker Change #114: Margin the margin also in the U S will be rather stable.
Speaker Change #114: Full year as a whole because we're balancing our investments and the upsides we're creating.
Speaker Change #114: Yeah.
Speaker Change #114: And we've talked about it earlier I think you Yolanda.
Speaker Change #114: Previous quarters.
Speaker Change #114: Sometimes we talk about.
Speaker Change #114: The margins in Europe, we see that recovery.
Speaker Change #114: We talked about the margin indeed U S. We have a business where both regions are 4% margin companies.
Speaker Change #114: And deaths.
Speaker Change #114: Therefore also not a surprise that youll see in our growing together.
Speaker Change #114: That 4% margin coming back again.
Speaker Change #114: And.
We have been always.
Speaker Change #114: In the U S with won't don't want to change that.
Speaker Change #114: We are a recovering to a 4% margin of Europe, knowing that we had some deviations who had to Belgium business.
Speaker Change #114: Alright.
Speaker Change #114: The suggestion that recommendation of this otherwise boring one maybe.
Speaker Change #114: You talked about Kroger.
Speaker Change #114: We.
Speaker Change #114: Sure Joe.
Speaker Change #114: Debt.
Speaker Change #114: We are oh.
Speaker Change #114: Expanding.
Speaker Change #114: It's also inorganically when opportunities arise.
Speaker Change #114: In line with our strategy and that's <unk>.
Speaker Change #114: We have seen Dell thoughts that's why you have seen trophy in Europe, which is.
Speaker Change #114: In line with strategy.
Speaker Change #114: There's more strength in market as well.
Speaker Change #114: Hmm.
Speaker Change #114: Also like in the past we are open to opportunities Inorganically.
Speaker Change #114: If dose fit our.
Speaker Change #114: Yes.
Speaker Change #114: <unk> balance sheets as you know so we have the firepower in itself, but we come back to you. If we have further ideas on M&A in total.
Speaker Change #114: Thank you can I just clarify on the price investments.
Speaker Change #114: With periods of great.
Speaker Change #116: I think you previously said that they would accelerate into the first half of 2025, Keith do you still see them accelerate to get into 2025 from 'twenty to 'twenty two.
Speaker Change #116: Yes, there is an acceleration from 2020 full into outgrowing together period, but the 1 billion that we talked today. It is a sequence over the full going together period.
Speaker Change #116: In 2025 years is also spread with branch through the year as well exactly.
Speaker Change #116: Okay.
Speaker Change #116: Thank you very much.
Speaker Change #116: Welcome.
Speaker Change #116: Thank you.
Speaker Change #117: Your next question comes from the line of further equity.
Speaker Change #118: Please go ahead.
Yolanda: Good morning from Yolanda J P team. Thank you for taking my questions.
Speaker Change #118: It's really about just understanding the moving parts.
Yolanda: Within the guidance.
Yolanda: Our only around 4% margin guide.
Yolanda: Is that consistent with both ends of the mid single digit to high single digit.
Yolanda: Growth range.
Yolanda: And if some of the where and the sales you see the bottoms of theirs.
Speaker Change #119: Your next question coming from.
Yolanda: Secondly, similar question free.
Speaker Change #119: Free cash flow level.
Speaker Change #119: Right.
Speaker Change #119: Okay.
Speaker Change #119: EPS growth, we should be looking at a $2 2 billion.
Speaker Change #119: Free cash flow or is that an obsolete.
Speaker Change #119: No matter, where if you deliver high single digit do you think free cash flow.
Speaker Change #119: Thank you.
Speaker Change #119: Okay. Thank you for your questions.
Speaker Change #119: Yes, the margin of rainfall is consistent mid to high single digit earnings per share guidance that.
Speaker Change #119: It's a combination of growth share buybacks and to ethics in fact, which is favorable for the year at current rates.
Speaker Change #119: And at least two points here it is.
To find $2 billion of free cash.
Speaker Change #119: We are guiding on so that's the floor one could say we also gave a 9 billion free cash flow for the total strategy Peoria too yes.
Speaker Change #119: Yes.
Speaker Change #119: For the year. So we said at least two two.
Speaker Change #119: 2025.
Speaker Change #119: Driving for more as a waste 12 till February.
Speaker Change #119: And let's not forget that.
Speaker Change #119: $2 7 billion Capex number for this year too.
Speaker Change #119: To take the necessary steps to modernize further our our S. S.
Speaker Change #119: To build stores and to invest further in <unk>.
Speaker Change #119: Data so those things of course also fits together.
Speaker Change #119: Okay. Thank you very much.
Speaker Change #119: Thank you.
Speaker Change #120: Your next question comes from the line of Francois <unk> from Kepler Cheuvreux. Please go ahead.
Francois Gao: Hello. Good morning, Thank you for taking my question.
Speaker Change #120: Okay.
Speaker Change #120: Could you come back on the U S ability to recruit really hasnt been through all your bottles on or does it compare to your assumptions underlying markets almost cycled question with deal Thats, probably globally in the U S.
Speaker Change #120: Phasing heightening the runs players or are you shipping.
Speaker Change #120: On the frozen products from Europe. Thank you.
Speaker Change #122: So the second question was do we find the right supplier base for private brand strategies is that your question.
Speaker Change #122: In the U S. Yes sure.
Speaker Change #122: Yeah.
Speaker Change #122: Let me.
Speaker Change #124: Taking a little bit broader because could request, we get questions questions on tariffs as well.
Speaker Change #124: In food retail, we all have we have a very small number of <unk>.
Just in general merchandize to start with food retail is very local.
Speaker Change #124: And although we import.
Speaker Change #124: A few things from Asia and Europe.
Speaker Change #124: It's a relatively small share and it's very much a level playing field for.
Speaker Change #124: For the competitors can compete with.
Speaker Change #124: But it is a very local business food so the tariffs.
Speaker Change #124: Most of that.
Speaker Change #124: Having a heavy impact on us.
Speaker Change #124: The second thing was the element of price investments and therefore also volume growth, yes, we see volume growth in all our branch in the U S and as I indicated before we.
Speaker Change #124: We intentionally.
Speaker Change #124: Okay.
Speaker Change #124: We would like to deliver on our fair share of growing together, we had a growth strategy as you know.
Speaker Change #124: It's why we started in the fourth quarter already but our preparations and we also happy to see that at all.
Speaker Change #124: For the year as I mentioned before.
Speaker Change #124: A very good start on growth and on volume.
Speaker Change #124: So yeah, that's what's our plan. This was a promise we growing to grow our business and its 4% CAGR for the total.
Speaker Change #124: <unk> is for us.
Speaker Change #124: The targets to deliver them.
Speaker Change #124: Thank you very much.
Speaker Change #124: Thank you.
Speaker Change #124: Okay.
Speaker Change #125: Next question comes from the line of Simon on table from the Gulf to come Okay.
Speaker Change #125: Go ahead.
Speaker Change #125: Yes, good morning, it's been on the board.
Speaker Change #125: Couple of questions My side I remain puzzled from the U S market.
Speaker Change #125: Because you say, we have a negative on favorable impacts from changes sales mix.
Speaker Change #125: But you closed down just off the shelf stores you also.
Speaker Change #125: Lots of impact of.
Speaker Change #125: The first direct assessment, which I thought had a positive impact on margin. So could you elaborate a little bit on that part.
Speaker Change #125: Uh huh.
Speaker Change #125: Then coming back on the amendment for the Netherlands, you said home with eight.
Speaker Change #125: The impact on your cash flow.
Speaker Change #125: What could be expected.
Speaker Change #125: Going forward, because I saw the charts quite bigger than that one.
To come back on the last question on Europe.
Speaker Change #125: I thought you said in the call.
Speaker Change #125: You assume.
Speaker Change #125: The dilutive impact of <unk> to be compensated by.
Speaker Change #125: Improvements in the rest of the business. So I still think that there's kind of three 8% margin for 2024 or do we need to compare to with progress in Q4 of 'twenty three 'twenty four.
Speaker Change #125: So on the.
Speaker Change #125: On the margin composition.
Speaker Change #125: And the central question for now.
Speaker Change #125: And indeed, we have not been maybe.
Speaker Change #125: Okay.
Speaker Change #125: Hopefully to complete here.
Speaker Change #125: There are two elements, which are also not helping our margin first of all our online sales growth.
Speaker Change #125: Grow double digits, which is strategy and we're very proud about that number and there is of course dilutive to our overall margin.
Speaker Change #125: Good thing is we also grow in pharmacy.
Speaker Change #125: And you have to you have heard that before with other players in the U S and that is also dilutive to <unk>.
Yolanda: Yolanda the other things of course.
Speaker Change #128: Thanks for the question.
Speaker Change #128: The pension settlement in our annual.
Speaker Change #128: For the quarter as 280 recommend it for pension settlement of which 205 is cash related and the remainder is the remainder remaining body of the balance sheet settlement.
Speaker Change #128: Of the 205 cash impact we paid already 102000.
Speaker Change #128: <unk> for the remainder of the 100 million is spread over the period to come and factored into our guidance.
Speaker Change #128: Okay. Thank you.
Okay.
Speaker Change #128: Last question, Yes, I like I said, I feel a bit repetitive, but we don't give that guidance Ah sorry.
Speaker Change #128: Sorry.
Speaker Change #128: To you to conclude on a group level.
Speaker Change #128: And.
Speaker Change #128: Okay. Thank you.
Speaker Change #128: Youre welcome.
Speaker Change #128: Thank you.
Speaker Change #129: Your next question comes from the line of Sweda Mahwah Collie from UBS. Please go ahead.
Speaker Change #129: Hi, good morning.
Speaker Change #130: France Yolanda JP.
Speaker Change #129: My questions.
Speaker Change #129: A couple.
Speaker Change #129: Maybe I think you referred to.
Speaker Change #129: The strategy a couple of times.
Speaker Change #129: Q&A.
Speaker Change #129: Since there okay. Good and then average 4% margin.
Speaker Change #129: Yes.
Speaker Change #129: In that context. These 2025, a year of investing I E.
Speaker Change #132: Aynsley below book and Martin is that why you're calling out around work to help you.
Speaker Change #129: Okay.
Speaker Change #129: This year and then obviously get you back to at least hooks and margin trajectory that you've enjoyed.
Speaker Change #129: So that's the first one secondly, if I can just let me briefly go back to help food use margin comments you made.
Speaker Change #129: The year is there some phasing to be.
Speaker Change #129: For us to be thinking about.
Speaker Change #129: A glucose tau.
Speaker Change #129: Some of US were trying to explore a bit more so if you could just help a little bit.
Speaker Change #129: Give us a little bit of an idea in terms of phasing cluster.
Speaker Change #129: <unk>.
Speaker Change #129: Maybe very lastly, sorry to squeeze one more in.
Speaker Change #129: Just in terms of run rate this year that I think Ron you record. The good start anything you can share in terms of current trading so club perhaps less.
Speaker Change #129: Great. Thank you.
Speaker Change #133: Hey, guys. It's good to hear you Mike.
Speaker Change #129: But some of that.
Speaker Change #134: You asked us for almost weekly guidance as of our results.
Speaker Change #129: But.
Speaker Change #129: I appreciate the interest and curiosity.
Speaker Change #129: On the on the total plan, yes, a CAGR of 4% growth yes.
Speaker Change #129: The 4% margin.
Speaker Change #129: We gave that guidance too.
Speaker Change #129: Jeff a little bit of flexibility.
Speaker Change #129: Of overtime because we.
Speaker Change #135: We would like to bring that growth.
Speaker Change #129: If you didn't break it down what does that mean for 2025.
Speaker Change #135: But I think it's too early to too.
Speaker Change #129: Sure. These kind of things, we just started the year.
Speaker Change #135: Yes.
Speaker Change #135: We started the year.
Speaker Change #135: Better than our 4% growth.
Speaker Change #135: At the beginning of the year or so.
Speaker Change #135: Yeah.
Speaker Change #135: A good start in.
Speaker Change #135: 25, so that's why the teams are ultra in the U S and also in Europe.
Speaker Change #135: Yeah.
No.
Speaker Change #135: Let's not forget I've mentioned it before.
Speaker Change #135: You cannot think about your strategy on the first of January.
Speaker Change #135: Did that.
Speaker Change #135: Starting up a ramp up earlier.
Speaker Change #135: And also in Europe.
Speaker Change #135: Tobacco sales out we also grew in Europe in the fourth quarter four 7% already.
Speaker Change #135: All that growth is coming I mentioned volume growth in both regions and we worked very hard to keep it alive.
Speaker Change #135: Let's see where we are when we talk to each other in the first quarter how that.
Speaker Change #135: Developed in the.
Speaker Change #135: Beginning of this year.
Speaker Change #135: We don't expect huge swings, we do things step by step and likes fronts that.
We have the opportunity because we had to get a second half of last year to already churn towards the strike.
Speaker Change #135: Phasing in and again.
Speaker Change #135: A big movement.
Yeah.
Speaker Change #135: Thank you both.
Speaker Change #136: Thank you we will now take our final question for today.
Speaker Change #137: And the final question comes from the line of Mike <unk> from Citibank. Please go ahead.
Speaker Change #136: Okay.
Speaker Change #138: Hi, Good morning, and thank you for taking my question being the laws.
Speaker Change #136: On Europe, instead of the U S.
Speaker Change #138: Could you elaborate a bit.
Speaker Change #138: The building blocks for the improvements in margin in Q4, excluding bullet with differently than the former in terms of margin of the different countries in Europe and in the Lenten season could you provided with the.
Speaker Change #138: Light on this Oswald please thank you.
Speaker Change #139: Thank you for that thank you for the question and I will say for focusing on Europe, because we are quite tired of how our European teams are indeed, performing the big swing in and European margin is coming from the Belgium future plan I mean, we we.
Speaker Change #138: Of course invested.
Speaker Change #139: In the Belgian transition, the 128 stores and affiliate.
Speaker Change #139: And you know they out they are outperforming the business cases, we had in recovering market share faster than we had we are now at a level of market share that is higher than before we started the plan. So you can really see that that intervention, which was a healthy one.
Speaker Change #139: And no and that margins.
Speaker Change #139: Ending faster than we expected towards.
Speaker Change #139: The targets that we set but also of course all the time.
Speaker Change #139: Tremendously well.
Speaker Change #139: Q4, so <unk> very happy with European performance, and the Belgium future plan makes a difference.
Speaker Change #139: Yolanda mentioned already Levered profile and of course, we are.
Speaker Change #139: Got our closing of the project delivered later the plant like Yolanda already mentioned, but it's very nice to see that the team's come very nicely together. There's good integration process of course, we got six months more time to prepare that so we are super well preparedness teams are now.
Speaker Change #139: Working on the synergies and.
Speaker Change #139: Im quite confident that this will be a great thing for our business and remain.
Speaker Change #139: The complementarity of the business 3 billion sales more so.
Speaker Change #139: A year ago will show a good number.
Speaker Change #139: To close off this the last question then.
Yolanda: And then I sound repetitive Yolanda.
Yolanda: But our business in the U S is a 4% business our business in Europe is a 4% business and you will see that number in Europe.
Yolanda: And you won't see us losing that number in the U S. So.
Yolanda: Let's see and thank you very much for your curiosity today.
Yolanda: For your attendance.
Yolanda: Okay.
Yolanda: And.
Yolanda: Speak to you in.
Yolanda: Quarter one.
Yolanda: It's not that far from now we look forward. Thank you.
Yolanda: This concludes today's conference call. Thanks for participating you may now disconnect.
Speaker Change #140: Ladies and gentlemen, good morning, and welcome to the Analyst Conference call on the fourth quarter and full year 'twenty 'twenty. Four result of all of that has.
Speaker Change #141: Please note that this call is being webcast and recorded during this call. Our hotel has that anticipates, making projections and forward looking statements all statements.
Speaker Change #140: Those of historical facts may be forward looking statements forward.
Speaker Change #140: Statements are subject to risks uncertainties and other factors that are difficult to predict and that may cause our actual results to differ materially from future risk.
Speaker Change #140: Expressed or implied by such forward looking statements.
Speaker Change #140: Therefore, you should not place undue reliance on any of these forward looking statements. The introduction will be followed by <unk>.
Speaker Change #142: Thank you session any views expressed by those asking questions on not necessarily the views of all that has though.
JP: At this time I would like to hand, the call over to J P. A mirror senior Vice President head of Investor Relations. Please go ahead JP.
J.P.M. Ara: Alright, Thank you very much John.
J.P.M. Ara: Good morning, everyone I'm delighted to welcome you all to our 2024 results conference call.
J.P.M. Ara: On today's call are friends motor, our president and CEO and Yolanda put supply at our CFO.
J.P.M. Ara: After a brief presentation, we will open the call for questions.
J.P.M. Ara: So we haven't seen it the earnings release and the accompanying presentation slides can be accessed through the investors section of our website at <unk> Dot com.
J.P.M. Ara: Provided extra disclosure.
J.P.M. Ara: Just for your convenience to ensure everyone has the opportunity to get their questions answered I ask that you initially limit yourself to two questions. That's two questions not five part question and if you have further questions and feel free to reenter the queue.
J.P.M. Ara: To ensure ease of speaking all growth rates mentioned in today's prepared remarks will be at constant exchange rates, unless otherwise stated and without friends over to you.
Speaker Change #143: Thank you very much J J P and good morning, everyone.
J.P.M. Ara: Reflecting on the year I'm proud of all that we've accomplished.
J.P.M. Ara: If I were to choose fee works to summarized our year it would be commitment consistency and clarity.
J.P.M. Ara: Commitment is staying true to our values to deliver for our customers every day and consistency.
J.P.M. Ara: Sticking to our plants, realizing another year of strong underlying performance.
J.P.M. Ara: <unk> been clear on where we are heading as a company through our growing to get our strategy.
J.P.M. Ara: [noise] commitment starts with our people.
J.P.M. Ara: 24 has been a dynamic and disruptive year with a lot of to do lots of things to do with.
J.P.M. Ara: Inflation volatility in commodities and supply chain.
J.P.M. Ara: <unk> and political tensions and fast paced changes Julian.
J.P.M. Ara: And how we work and how we live.
J.P.M. Ara: Trading.
J.P.M. Ara: Customers.
J.P.M. Ara: Turning to the local circumstances and specific niche continue.
J.P.M. Ara: Integral differentiator for our business.
J.P.M. Ara: And for this I would like to thank our passionate associates for living our values and their dedication to our performance driven culture.
J.P.M. Ara: Okay.
J.P.M. Ara: Moving to consistency this for me means sticking to our promises.
J.P.M. Ara: In 2024, we said you could depend on us for four fix.
J.P.M. Ara: Our relentless focus on the customer our price positioning and leveraging the strength of our great local brands.
J.P.M. Ara: Continued advancement of our own brand strategies, increasing penetration and category depth.
J.P.M. Ara: First a very for simplification and modernization of our organization to sustain growth.
J.P.M. Ara: We're continuing.
J.P.M. Ara: Continuing to be laser focused on cost control and cash flow to reinvest in our customers and our company.
J.P.M. Ara: Looking at our scorecard, we were indeed, consistent and then.
J.P.M. Ara: Or exceeded all of our key goals for the year.
J.P.M. Ara: At the same time, we also had the room to Kickstart Stifel.
J.P.M. Ara: Together initiatives, which will pave towards 2025.
J.P.M. Ara: And then finally clarity, which is ultimately the key to great execution.
J.P.M. Ara: In May and June we crystallized, our game plan and ambitious for the coming four years building on our core strengths and looking with an open mind.
J.P.M. Ara: Okay.
J.P.M. Ara: Yes.
Speaker Change #144: We have an ambitious growth plan, where we want to grow faster than the industry.
J.P.M. Ara: Training, leading margins and deliver sustainable earnings growth.
J.P.M. Ara: And I'm, particularly proud of how quickly our teams have stepped into our new strategy, which several actions already well underway.
J.P.M. Ara: Let me share a few highlights in this respect.
J.P.M. Ara: First area is investing in our winning CVP the customer value proposition.
J.P.M. Ara: We want our customers to have vibrant.
J.P.M. Ara: Every time, they interact with our brands whether in store or digitally or at the intersection of the two.
J.P.M. Ara: To put it.
J.P.M. Ara: We are elevating our digital solutions and also adding some secret sauce through AI and predictive analytics.
J.P.M. Ara: And in the U S. Our brands delivered 12 billion Personalised offers 40 year.
J.P.M. Ara: A 1 billion increase compared to 2023.
J.P.M. Ara: And we also announced a new partnership with in market intelligence on digital coupons to further improve ofer types and savings.
J.P.M. Ara: At alphabet to increase.
J.P.M. Ara: The modular ecommerce platform was launched.
J.P.M. Ara: A series of six launches across the European market.
J.P.M. Ara: At Alberta in the Czech Republic, the first Brent on the new App earlier monthly App users have increased by over 20%.
J.P.M. Ara: Sales have increased nearly 10% compared to 2023.
J.P.M. Ara: Okay.
J.P.M. Ara: In tandem with our digital experiences. We also have been working hard on our assortment throughout the year.
J.P.M. Ara: Ensuring we offer the customer the freshest healthiest products on the market at great competitive prices.
J.P.M. Ara: In this respect.
J.P.M. Ara: Strengthening own breadth of assortment is key and we have a big ambition to increase own brand penetration over time to 45%.
J.P.M. Ara: Overtime is a front runner in own brand execution and in 2020 for more than 150.
J.P.M. Ara: Brent products or product lines, where award winning in consumer taste and quality elections.
J.P.M. Ara: Our.
J.P.M. Ara: To make progress on the product harmonization, bringing an additional 500 products both price value and shorten the difference.
J.P.M. Ara: To the right.
J.P.M. Ara: These products also play a vital role in increasing regional price favorites.
J.P.M. Ara: With all the CSC breath.
J.P.M. Ara: A minimum of 825 fresh favorites in the everyday assortment wishes and increased 15%.
J.P.M. Ara: Back to 2023.
J.P.M. Ara: In the U S. A major focus has been on raising the awareness of own brands quality and price relatively to national brands.
J.P.M. Ara: During the last quarter U S owned branch sales growth outpaced the rest of the store in both dollars and units.
J.P.M. Ara: The second thing.
J.P.M. Ara: I would like to highlight today is the progress we are making to densify and grow our markets.
J.P.M. Ara: Prioritizing optimizing and sharpening our portfolio you will see a more pronounced a rigorous focus on growing customer reach and extending leading positions in the most profitable markets.
J&J: During our strategy day in May J&J presented a clear view for the future potential of the U S brands in this respect.
J&J: One of those is the giant company, which is a regional presence local customer base and leading market positions.
J&J: It is why I'm pleased about our new store opening of the branch in Philadelphia in December.
J&J: Additional stores in the works for 2025.
J&J: Additionally, 95% of the store fleet is now remodeled with latest Florida Zion.
J&J: On the flipside, making necessary interventions from a branch are challenged is an essential contributor to elevating the quality.
J&J: Sales to.
J&J: The successful completion of the Belgium future plan.
J&J: In addition project and the closure of the identified underperforming stop and shop locations demonstrated.
J&J: Our company's ability to do so and with these projects behind US I will shut next steps. The teams are focused on a little bit later.
J&J: Next let's spend a moment on leveraging and lowering our cost base in an environment, where inflationary costs are a concern for many households, our brands remain proactive to ensure that essential items are affordable and within reach for.
J&J: Well, it's nice.
J&J: This is fueled by our save for our customers program, where we are proud that we exceeded our plans generating over 135 billion.
J&J: Cost savings in 2024.
J&J: And always and although we always can do better to things, we do really well in this respect our fact based negotiations through our should cost models and simplification, where we challenge ourselves to continuously improve and magnified the best practices.
J&J: Examples of simplification through collaborations from last year include for example in the U S. The team began streamlining the support brands into one of the less USAID support organization supported all of our five local brands in a consistent and cost efficient manner.
J&J: In the <unk> region. The breath of completed the first phase of a project to standardized labor management, allowing for optimal store execution.
J&J: Additionally, commercial operations have been standardized.
J&J: Z brands, including one centralized data supporting.
J&J: Consistent training across virus.
J&J: Liked calendars for negotiations.
J&J: This will also provide opportunities for coffee.
J&J: Towards beverage as we unlock synergies in the coming years.
J&J: Finally, let me spend a moment on healthy company.
Speaker Change #146: Ladies and planet.
J&J: While the environment we operate.
J&J: It continues to evolve our role and commitment commitment to support healthy communities and planet is unchanged.
J&J: These topics remain key for long term business resilience.
Speaker Change #147: Our competitive advantage and Alaska.
J&J: Mostly with our values.
J&J: Our brands.
J&J: To implement the projects to promote healthy affordable food drive sustainable business practices.
J&J: Reducing food waste and energy consumption.
J&J: And encourage diversity and inclusion in the workplace, reflecting.
J&J: Reflecting our respecting the local communities in which we operate.
J&J: One such example was obtained in the Netherlands, it's focus on healthy and sustainable products has contributed significantly to its growth in market share.
J&J: Loyalty.
J&J: That percentage of O&M rent healthy food sales increased.
J&J: Increased to close 200 basis points in 2010 before while the organic range and plant based assortment.
J&J: Brent.
J&J: Overtime Teva are extremely popular.
J&J: So in summary, as released 2024 behind there are lots of positives.
J&J: Built upon in 2025.
J&J: I will share a few of our plans for the year a little bit later.
Yolanda: Over to Yolanda to share her remarks and insights in our numbers. Thank.
Yolanda: Thank you, France, and good morning to everyone.
Speaker Change #148: Great thing about being a grocery retailer is that we are constantly connected to our estimate.
Speaker Change #148: Personal lines.
Speaker Change #148: Connections, we have with them understanding their needs in real time is powerful.
Speaker Change #148: Combined with the agility.
Speaker Change #148: <unk> spirit of our great local brands.
Speaker Change #148: Sure.
Speaker Change #148: Growing market shares strong relative brand strength.
Speaker Change #148: We can see we are doing the right things as customers choose to shop with US every day.
Speaker Change #148: Okay.
Speaker Change #148: And we are very pleased with how we ended the year strong holiday sales. Thanks, Jay first of Assortments and shopping experiences that offered customers everything they need to celebrate the season.
Speaker Change #148: On slide 18, and 19, we pretend the key underlying numbers for the quarter and the full year two summarized net.
Speaker Change #148: Net sales grade 0.6% to 23.
Speaker Change #148: Billion during the quarter and 0.9% to $89 4 billion euro during the full year.
Speaker Change #148: Sales benefited from positive comparable sales ex gas and store openings the end of tobacco sales in the Netherlands.
Speaker Change #148: Closure of underperforming stop inshore locations and the divestment of <unk>.
Speaker Change #148: Correct impacted net sales growth by two points, one and one seven percentage points for Q4 and full year respectively.
Speaker Change #150: All lines at Hill's.
Speaker Change #150: By five 8% in Q4, and three 5% for the full year.
Speaker Change #150: Assessment of fresh direct had a negative impact of 5.1 percentage points for the quarter.
Speaker Change #150: And six points.
Speaker Change #150: Percentage point for the full year.
Speaker Change #150: Excluding fresh direct we saw double digit growth rates that many of our brands, including all the time and food Lion.
Speaker Change #150: Underlying operating margin for the quarter was four 1% a decrease of 20 basis points versus last year, mainly due to lower nonrecurring items in the U S related to holiday.
Speaker Change #150: Yes.
Speaker Change #150: Our full year underlying operating margin for 2024.
Speaker Change #150: Zero percent.
Speaker Change #150: Diluted underlying earnings per share was 69 cents for the quarter and two euros 54 cents for the full year in line with our guidance.
Speaker Change #150: Our operating income for the quarter was 607 million Euro.
Speaker Change #150: We are presenting and I are friends operating margin of two 6%.
Speaker Change #150: I have read results with $351 million.
Speaker Change #150: Lower than the underlying results largely related to an amendment and additional funding of the Dutch pension plan.
Speaker Change #150: With this change we have reduced our overall pension risk exposure and have eliminated the annual variability in the noncash service charges.
Speaker Change #150: Yeah.
Speaker Change #150: For the full year operating income was $2 8 billion Euro represented.
Speaker Change #150: <unk> operating margin of three 1%.
Speaker Change #150: <unk> results were 824.
Speaker Change #150: Million Euro Aloha, and the underlying results largely due to <unk>.
Speaker Change #150: Associated with the following elements.
Speaker Change #150: The transitional stores as part of the Belgium future plan.
Speaker Change #150: Gerald stop <unk> shop stores, and the amendment to and additional funding of the Dutch pension plan.
Speaker Change #150: Let's take a closer look at our Q4 performance starting with revenues.
Speaker Change #150: Q4, comparable sales with 1.4% which increases <unk>.
Speaker Change #150: It is net impact of 0.1 percentage points from weather and calendar shifts.
Speaker Change #150: And a negative impact of 1.1 percentage point from the end of tobacco sales in the Netherlands.
Speaker Change #150: U S comparable sales shows a positive.
Speaker Change #150: For calendar and weather of 20 basis points.
Speaker Change #150: In Europe, the Mazo ranked three four percentage points negative.
Speaker Change #150: Tobacco and calendar.
Speaker Change #150: Looking at the regional performance U S. Net sales were a third party.
Speaker Change #150: Daily in Euro.
Speaker Change #150: Medical sales, excluding gas increased one 2%, excluding net weather and calendar impact.
Speaker Change #150: Flatting growing it.
Speaker Change #150: Comparable sales momentum and a return to positive volumes.
Speaker Change #150: Got it.
Speaker Change #150: In addition to the calendar and weather impact net sales were impacted by the following.
Speaker Change #150: Around 110 basis points.
Speaker Change #150: The impact of stop and shop closures.
Speaker Change #150: Okay.
Speaker Change #150: <unk> from the divestment of fresh direct.
Speaker Change #150: Around 25 basis points from a decline in gasoline sales.
Speaker Change #150: All right.
Breath of 10, 9% adjusted for the impact of fresh direct was a key highlight of the quarter.
Speaker Change #150: Customers are responding positively.
Speaker Change #150: Our partnership with door Dash, while we continued to see in our mind award is accelerating with a 20% increase.
Speaker Change #150: Orders in Q4 compared to Q2.
Speaker Change #150: Okay.
Speaker Change #150: And the operating margin in the U S was four 2% in line with the third quarter. The margin performance year over year was impacted by lower nonrecurring items price investments at stop <unk> shop, and net unfavorable impact from a change in sales mix and wage inflation.
Speaker Change #150: In Europe fourth quarter trends were again strong.
Speaker Change #150: Net sales were $9 4 billion euros up two 4% despite being net.
Speaker Change #150: Effected by two eight percentage points from the end of tobacco sales in the Netherlands.
Speaker Change #150: The impact of tobacco and calendar shifts comparable sales increased four 7%.
Speaker Change #150: Like in the U S online sales growth was robust increasing by 10, 9%.
Speaker Change #150: Underlying operating margin in Europe.
Speaker Change #150: 24% up 70 basis points.
Speaker Change #150: Mainly driven by strong performance recovery in Belgium, lower energy costs.
Speaker Change #150: We think it's important to appreciate this.
Speaker Change #150: Strong value creation.
Speaker Change #150: Market positions and opportunities being delivered by our European teams.
Speaker Change #150: <unk> achieved its sixth consecutive year of strong growth further expansion.
Speaker Change #150: At 237, 7%.
Speaker Change #150: Supported.
Speaker Change #150: The increase in number of customers and created royalty among existing customers.
Speaker Change #150: In Belgium continues its strong market share recovery following the transition of stores to the SaaS model.
Speaker Change #150: Net promoter score.
Speaker Change #150: Increase in number of customers and markets, yet and well above pre announcement levels.
Speaker Change #150: Finally, following a strong holiday period bull, so an acceleration in sales growth.
Speaker Change #150: Achieved an all time high in App users and recognized Hyatt.
Speaker Change #150: Ever quarter of sales.
Speaker Change #150: This in combination with double digit growth in advertising services.
Speaker Change #150: And a relentless focus on cost management.
Speaker Change #150: Financial Inc.
Speaker Change #150: Profitability with full year underlying EBITDA growing to $185 million.
Speaker Change #150: <unk> from 159 million year round.
Speaker Change #150: Part of both competitive advantage is its best in market proposition, giving access to over 47000 sales partners.
Speaker Change #150: An example is that flourishing collaboration with Leeco in addition to compelling holiday campaigns, which day.
Speaker Change #150: 5% increase in legal sales, but also introduced a pop up legal shelf, which was a resounding success. The second BOP up already planned for later this year in Belgium.
Speaker Change #150: Free cash flow Q.
Speaker Change #150: Q4 free cash flow was $1 3 billion Euro, which represents an increase of 227 million euro impact Q.
Speaker Change #150: Q4 2023.
Speaker Change #150: Looking at the full year, we realized a free cash flow of over $2 5 billion euro exceeding our guidance of the year.
Speaker Change #150: Our net capital expenditure for the year was below our original guidance in part due to timing of certain project shifted to 2025 like Atlanta distribution center expansion football.
Speaker Change #150: Lower store Rollouts in GSV and delaying some remodels in the U S to calibrate more efficiently to our new strategy.
Speaker Change #150: With capital expenditure are running slightly lower the strength of our underlying operations allowed us to take the opportunity to optimize our future pension obligations in the net.
Speaker Change #150: This additional funding to the Dutch pension plan of 105 million Euro.
Speaker Change #150: To complete the picture on Slide 27, you can see our net debt bridge Yale.
Speaker Change #150: Despite Ron returning 2 billion euro to our shareholders.
Speaker Change #150: We're able to show a decline mainly due to healthy free cash flow levels, partially offset by the impact of foreign exchange rate on that debt.
Speaker Change #150: With these results I'm pleased to announce a proposal to increase the dividend per share by six 4% for 2024 to one.
Speaker Change #150: And 17 cents per share.
Speaker Change #150: We've also initiated the 1 billion euro share buyback program for 2025 on the setup.
Last year.
Speaker Change #150: Finally, let me provide some insights in our healthy community and planets priorities in.
Speaker Change #150: In 2024.
Speaker Change #150: Vintage of own brand healthy food sales was 52, 4%. This represents a step up of almost one percentage point compared to 2023, if we exclude the negative impact.
Speaker Change #150: Three five percentage points from the Tracy.
Speaker Change #150: Nutri score 2.0 for our Dutch and Belgium brands.
Speaker Change #150: Total tons of food waste pet food sales was 35%.
Speaker Change #151: Then on Tuesday is an India based.
Speaker Change #150: Baseline.
Speaker Change #150: This is a similar result as in 2023. However, it includes a negative impact of four percentage points from improved data quality and measurement in the U S.
Speaker Change #150: In Europe.
Speaker Change #150: <unk> improved driven by closer collaboration with partners to increase food bank donations.
Okay.
Speaker Change #150: Our C O two emissions in our own operations by 36% compared to our 2018 baseline and improvement of 2% versus last year driven.
Speaker Change #150: Installation of more sustainable refrigeration system in the U S tools and an increased use of cleaner energy in Europe.
Speaker Change #150: For Virgin and brand plastic packaging.
Speaker Change #150: What a 10.
Speaker Change #150: Production comes back to 2021.
Speaker Change #150: Which is equal to a reduction last year.
Speaker Change #150: Our brands were able to increase the percentage of resource.
Speaker Change #150: Content and continued to implement initiatives.