Koninklijke Ahold Del Ord

Ladies and gentlemen, good morning and welcome to the analyst conference call on the first quarter 2025 results of Aho Delhaes. Please note that this call is being webcast and recorded. During this call, Aho Delhaes 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 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. The introduction will be followed by a Q&A session. Any views expressed by those asking questions are not necessarily the views of our hotel heads. At this time, I would like to hand the call over to JP O'Meara, Head of Investor Relations. Please go ahead, JP.

Thank you very much, Erin, and good morning, everyone from Zendam. I'm delighted to welcome you to our Q1 2025 results conference call. On today's call are Franz Muller, our president and CEO, and Yolanda Putzweil, our CFO. After a brief presentation, we will open the call for questions. In case you haven't seen it, the earnings release and the accompanying presentation slides can be accessed through the investor section of our website, aholdeles.com, which also provides extra disclosures and details for your convenience. To ensure everyone has the opportunity to get their questions answered today, I ask that you initially limit yourself to two questions. I'll just repeat myself again. Two questions, please, to make sure everyone on the call would have sufficient time. If you have further questions, then feel free to re-enter the queue. To ensure ease of speaking, all growth rates mentioned in today's prepared remarks will be at constant exchange rates unless otherwise stated. And with that, friends, I'll hand the call over to you.

Yes, thank you very much, JP, and good morning, everyone. At the heart of our growing together plan and our growth model is our ambition to accelerate growth and outperform the industry in the coming years. Therefore, I am pleased to report a strong first quarter, placing us well on track to reach our goals and aspirations for the year. It has been a dynamic start to the year, as in both regions we are operating in an environment of increasing geopolitical volatility. In the U.S., there have been recent spikes in the price of X, evolving conditions around tariffs, and increasing job insecurity in several parts of the country. In Europe, we experience ongoing conflict in Ukraine and large-scale protests in several Central and Southeast European countries against corruption. To navigate this environment, the most important thing is to stay focused, be agile to meet customer needs, and leverage your strength through your teams. I'm confident our growing together strategy provide us with the right toolkit to do just that. Our plan is anchored in the core attributes of what it takes to be a great local retailer. It has this heart of our strategy and our growth model which balances investment and cost control to deliver a compelling customer value proposition now and in the future no matter the market environment. To this end, during the quarter, we continued with our planned price investments in the U.S. giant food, for example, expanded their Fresh Low Prices initiative, lowering the price on hundreds of products across their own brand range. This builds on the steady cadence of price investments at Stop & Shop that already started in the second half of 2024. And as of today, Stop & Shop has rolled out value-enhancing campaigns, and lower prices at more than 40% of its stores. While we are still in the early phases of the campaigns, we are encouraged by the positive feedback with volumes, beginning to trend better at locations where interventions have been made. We are closely monitoring the impact of these investments and have created a strong feedback loop to make adjustments to optimize future programs. Albert Heijn in the Netherlands has further expanded their plant-based Terra own brand range to 350 products. Over 20% of this product range is part of price favorites and all items qualify for an additional 10% discount as a part of our Albert Heijn premium program. We are also doing a lot of great work to transform our loyalty programs to make progress towards our ambition to drive omnichannel loyalty sales penetration to over 80% by 2028. In the first quarter of this year, our five U.S. brands delivered over 3.2 billion personalized offers, which is a year-over-year increase of 25%. MyHannaford's Rewards was named amongst Newsweek's America's Best Loyalty Programs. As customers shop over time, They receive personalized offers for the products they love and earn 2% rewards on every own brand item. It's no surprise that Hannaford leads the U.S. in own brand penetration at almost 38%. A year ago, Albert in the Czech Republic added new MyAlbert features to drive loyalty, higher baskets, more traffic and increase healthy sales. And for example, included in these features are weekly personalized rewards and additional rewards for shopping over certain thresholds, 15% discount on our Nature's Promise Home Brand product line, and the ability to earn credits on selected healthy products. Since the update, Albert has seen a doubling in customer engagement and in discounts redeemed. 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. Which brings me to the next growth driver that I would like to spend some time on. Densify and grow our markets. Starting first with Profi. We are pleased to have completed our first quarter with Profi integrated into our portfolio of brands. Profi adds over 1700 supermarkets and convenience stores to our European footprint in the CSE region and will contribute over 3 billion euro to our sales throughout 2025. The acquisition solidifies our ambition to reach the number one or number two position in the markets where we operate. It also sets the CSE region up for additional growth and provides opportunities to drive synergies. 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. When the opportunities arise, this also includes improving our position in the market by relocating our replacing stores. With a replacement store, we recognize the benefit of a larger sales uplift than a standard remodel, without growing the store count, but with paybacks also taking a shorter time compared to opening a new store. An example of this is at Giant Food, which opened a replacement store at the South Lake Marketplace 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 and a restaurant, creating a vibrant retail recreation hub that benefits local residents and businesses. As part of our plan to revitalize Stop & Shop, we communicated our intentions to deploy a more efficient use of capital to complete the remaining store remodels. Going 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. Under this way of working, Stopper Shop completed four remodels during the quarter and recently celebrated the remodel of the Framingham in Massachusetts location. The store includes remodeled produce and bakery departments, expanded prepared foods, and over 800 new products, including additional multicultural assortments. Moving to the next quadrant of 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. Again, we have made good progress on this front during the quarter with several initiatives we believe can scale over time. And here are just a few examples. AD Retail Media in the US has partnered with Inmar Intelligence to provide advanced in-store advertising solutions for CPG partners. This collaboration aims to enhance customer engagement by utilizing creative strategies to reach shoppers at key moments in their shopping journey. Inmar's measurement tools will enable CPG companies to assess the effectiveness of their investment in advertising. Bol is piloting branded shelves for 50 selected advertisers, allowing them to customize content, branding, and product selection. This initial version aims to gather insights on campaign performance and advertising interaction, which will guide the broader rollout of the feature in this May. Albert Heijn recently introduced Stain, your smart helper in the kitchen, which gives a face to the already existing My Albert Heijn assistant. Stein makes it possible to naturally engage in conversation with moms and dads and children about all questions in the kitchen and will be given more functionality in the coming periods. Healthy communities and planet is an important priority within our growing together strategy. and we are committed to playing our role in the transition to a healthier and more sustainable food system. Every small change we implement makes a difference on a larger scale and I'm proud that we achieved several important milestones already in this year. We successfully priced our third sustainability linked bond. We published our second green bond impact report and the carbon disclosure project a prominent global benchmark on environmental issues, recognized our progress in climate by upgrading our climate rating to A-. And we received validation of our scope 3 targets in line with a 1.5 degrees scenario from SBTI. That completes my review of our performance so far this year. I'm confident our brands are taking the right steps moving at the right pace and leveraging the strong foundation and skill of our business supporting our customers and driving competitive advantage for our business along the way. Now over to Jolanda to talk more about the financials.