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May 18, 2006

NETHERLANDS: Ahold chief says must quicken pace of recovery

Speaking at Ahold’s AGM, president and CEO Anders Moberg said that although the company had taken great strides towards recovery since 2003, it is now time to quicken the pace.

Speaking at Ahold’s AGM, president and CEO Anders Moberg said that although the company had taken great strides towards recovery since 2003, it is now time to quicken the pace.
 
Recognising the challenges faced over the past three-years, such as the problematic integration of US Stop & Shop and Giant-Landover, Moberg told shareholders that the tagrets set in 2003 remain unchanged.

“We have given an outlook for 2006 that falls short of the original targets we set in 2003. But let me be clear, these original targets remain unchanged. I believe we can – and need – to achieve them to continue to be competitive and successful. This remains our focus and our goal,” he said.

In 2005, Moberg said, Ahold completed its divestment program, reduced debt, launched a new US Foodservice strategy and successfully drew Ahold’s various businesses together. “During the past year we continued to work on our strategic initiatives – sourcing, general merchandise, and IT retail systems – to drive synergies, create simplicity, and reduce costs,” he observed.
 
Outlining the challenges in a highly competative market, Moberg said that consumer attitudes towards value had altered: “Customers at all income levels now expect to see a distinct difference in quality, service or convenience if they are to pay more….To compete successfully in this new value-driven world, it is more critical than ever to understand what our customers want – and to deliver superior solutions, faster than the competition.

“We are not satisfied. We must find ways to increase the pace of implementing our strategic plans without sacrificing the quality of execution. This is a critical objective and a top priority.”

Moberg said that one area where the retailer would be able to differentaite itself and offer high-quality value products was in the production of own-brand foods. He also identified Ahold’s ability to make shopping an easy one-stop experiece by offering a range of general goods.

“One of our greatest strengths is making shopping easy for customers. Easy in, easy shop, easy out. We have great locations and we continually invest in improving our stores,” Moberg said.

In order to improve the company’s competative position in the market, the Dutch retailer is currently experimenting with new retail formats in Europe and the US.

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