Food Lion 2008 Annual Report Download - page 7
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OUR STRATEGIC PRIORITIES
Coping with a Challenging 2009
We expect our Group to benefit from continued revenue momentum in
2009 even though the economic outlook looks uncertain. Our Company
has never been in stronger shape than it is today. We remain confident
that we have strong store concepts, assortments, prices and energetic
associates which are ready to do their utmost to offer friendly and
efficient service to our customers. Furthermore, we have developed
solid plans to support our Group’s revenues, profitability and cash
flows.
Our strategy remains organized around the three pillars of profitable
top-line growth, the pursuit of excellence in execution and corporate
citizenship.
Strong top-line growth is the key to success in our industry. In 2009, all
our operating companies will continue to drive top-line growth through
innovative concept and brand differentiation, dynamic store and market
renewals as well as network expansion.
The key-element in Delhaize Group’s market approach is “creating
distinctiveness”. The Group’s objective is to connect with its customers
by permanently renewing and developing our assortment and offering
interesting alternatives.
Guiding Stars
, our nutritional information
system in the U.S., continued investments in our organic product
assortment and further work on customer segmentation will remain
important elements of our sales building activities.
The current economic environment requires us to be very price com-
petitive. Now more than ever, consumers are looking for alternatives
such as private brand products and lower priced items. We are com-
mitted to offering our customers three critical elements: competitive
prices, a great variety of quality products and outstanding service. In
2009, we will continue to develop our successful private brand pro-
gram in the U.S. Constant innovation in our stores and the develop-
ment of radically new concepts such as the ones we recently opened
in Belgium, Greece and the U.S. will help us learn how to improve our
existing stores and increase their relevance to the consumer.
Network expansion will supplement revenue growth in existing stores.
Our Group plans to open between 106 and 116 new stores in 2009.
Strong revenue growth must be supported by excellence in execution,
the second pillar of our strategy. We are committed to the ongoing
development and improvement of our systems and processes with
the clear goal of becoming “Best-in-Class” in this domain. Delhaize
Belgium will open a new distribution center for fresh products in 2009
and our U.S. operating companies will start to work on the first phase
of the project to integrate the existing supply chain organizations
into one single master network resulting in an integrated consumer
driven supply chain. Throughout the Group, we have set objectives
to align enterprise systems and create common platforms to improve
efficiencies in a multitude of processes. Where appropriate, we will
› Generate Profitable
Top-line Growth
› Pursue Best-in-Class
Execution
› Operate as a Responsible
Corporate Citizen
converge systems and processes across our operating companies to
standardize what is not relevant for our customers.
We are dedicated to growth but at the same time we want to be
prudent in these uncertain times. This means that we will go to great
lengths this year to support our profitability and our cash flows.
Therefore, in 2009 we plan cost savings of EUR 100 million, on top of the
EUR 60 million we realized in 2008. These savings will be reinvested
in the growth of our business and support our profits and cash flows.
Improved working capital management will free up an additional
EUR 50 million of cash.
In 2009, our Group plans EUR 600 to 620 million in capital expenditures
compared to EUR 714 million in 2008. These investments will continue
to focus on store openings and renewals, and innovations in our
supply chains worldwide.
Corporate responsibility is the third pillar of our strategy because
we are convinced that beyond the generation of financial profit, our
Company must play a role each and every day to improve the lives
and well-being of our customers and associates and the vitality of the
communities in which we operate. We believe that ultimately, what
is good for society is good for our business. In 2008, we published
our first Corporate Responsibility report, including an impressive list
of CR initiatives within Delhaize Group. We take great pride in the
extraordinary achievements our associates have reached so far, but
know we can do even better. Our goal is to develop strategies and
targets to improve further our corporate responsibility performance.
In 2008, our 141 000 associates have faced a very difficult economic
environment with motivation, commitment and innovative thinking.
We are grateful to all of them for their drive and energy. Thanks to
them, Delhaize Group was able to stay the course. In 2009, we will
face challenging economic times with strength, resilience and an
exceptional attitude.
Finally we want to thank you, our shareholders, for your confidence
and loyalty. With your continued support and collaboration in 2009,
we will make of Delhaize Group an even stronger Company.
Count Jacobs de Hagen,
Chairman of the
Board of Directors
Pierre-Olivier Beckers,
President and
Chief Executive Officer
Delhaize Group Our Strategy Our Activities in 2008 Corporate Governance Risk Factors Financial Statements Shareholder Information
at a Glance
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Chairman and the CEO
> Overview of
Operating Companies