Public companies are required to disclose risks that can affect the business and impact the stock. These disclosures are known as “Risk Factors”. Companies disclose these risks in their yearly (Form 10-K), quarterly earnings (Form 10-Q), or “foreign private issuer” reports (Form 20-F). Risk factors show the challenges a company faces. Investors can consider the worst-case scenarios before making an investment. TipRanks’ Risk Analysis categorizes risks based on proprietary classification algorithms and machine learning.

Koninklijke Ahold Delhaize disclosed 49 risk factors in its most recent earnings report. Koninklijke Ahold Delhaize reported the most risks in the “Finance & Corporate” category.

Risk Overview Q4, 2016

Risk Distribution

41% Finance & Corporate

16% Legal & Regulatory

16% Macro & Political

14% Production

8% Ability to Sell

4% Tech & Innovation

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

This chart displays the stock's most recent risk distribution according to category. TipRanks has identified 6 major categories: Finance & corporate, legal & regulatory, macro & political, production, tech & innovation, and ability to sell.

Risk Change Over Time

S&P500 Average

Sector Average

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Koninklijke Ahold Delhaize Risk Factors

New Risk (0)

Risk Changed (0)

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No changes from previous report

The chart shows the number of risks a company has disclosed. You can compare this to the sector average or S&P 500 average.

The quarters shown in the chart are according to the calendar year (January to December). Businesses set their own financial calendar, known as a fiscal year. For example, Walmart ends their financial year at the end of January to accommodate the holiday season.

Risk Highlights Q4, 2016

Main Risk Category

Finance & Corporate

With 20 Risks

Finance & Corporate

With 20 Risks

Number of Disclosed Risks

S&P 500 Average: 31

Recent Changes

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Since Jan 2017

0Risks added

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Since Jan 2017

Number of Risk Changed

S&P 500 Average: 3

See the risk highlights of Koninklijke Ahold Delhaize in the last period.

Risk Word Cloud

The most common phrases about risk factors from the most recent report. Larger texts indicate more widely used phrases.

Risk Factors Full Breakdown - Total Risks 49

Finance & Corporate

Total Risks: 20/49 (41%)Above Sector Average

Share Price & Shareholder Rights8 | 16.3%

Share Price & Shareholder Rights - Risk 1

Dividends paid on our common shares, which may include amounts paid by our Company to repurchase ordinary shares, will generally be subject to Dutch withholding tax.

Dividends, if any, paid on our common shares will generally be subject to a 15% Dutch dividend withholding tax. In certain circumstances, amounts paid to repurchase our common shares may be treated as dividends that are subject to a withholding tax. In such a case, if the repurchase of our common shares is from an unknown seller, the Company will be responsible for the tax payment, on a grossed-up basis, at a 17.65% rate.

Share Price & Shareholder Rights - Risk 2

Provisions in the call option agreement of Stichting Ahold Continuïteit (SAC) could discourage, delay or prevent a change of control of our Company.

Pursuant to the provisions of the call option agreement of SAC, a foundation with the purpose of safeguarding the interests of our Company and all our stakeholders and potentially resisting, to the best of its ability, influences that might conflict with those interests by affecting our Company's continuity, independence or identity, may acquire from our Company a number of Ahold Delhaize cumulative preferred shares in our share capital with a nominal value of €0.01 per share such that the total nominal value of the Ahold Delhaize cumulative preferred shares so acquired is equal to (a) the total nominal value of all Ahold Delhaize common shares and all Ahold Delhaize cumulative preferred financing shares, in each case issued and outstanding at the time of exercising the SAC call option, minus (b) the total nominal value of any Ahold Delhaize cumulative preferred shares held by the SAC at such time. Each Ahold Delhaize cumulative preferred share would, upon the issuance of Ahold Delhaize cumulative preferred shares following the exercise of the SAC call option, give the holder the right to one vote. The issuance of these Ahold Delhaize cumulative preferred shares would, as a result, cause a substantial dilution of the voting power of any holder of shares in the capital of our Company, including of a shareholder attempting to gain control of our Company, and could therefore have the effect of discouraging, delaying or preventing a change of control of our Company, even if this change in control is sought by our shareholders.

Share Price & Shareholder Rights - Risk 3

If we issue additional common shares in the future, the value and voting power of our common shares may become diluted as more common shares become issued and outstanding.

We may undertake additional offerings of common shares or of securities convertible into our common shares. The resulting increase in the number of our common shares issued and outstanding, and the possibility of sales of such common shares, may depress the future trading price of our common shares. In addition, if such additional issuances of common shares of our Company occur, the voting power of the existing shareholders of our Company may be diluted.

Share Price & Shareholder Rights - Risk 4

Holders of the common shares in our Company who are resident or located in certain jurisdictions outside the Netherlands, including the United States, may not be able to exercise pre-emptive rights in future offerings and, as a result, may experience dilution.

In the event of an issue of common shares in the capital of our Company, holders of common shares in our Company are generally entitled to pre-emptive rights unless those rights are restricted or excluded either by a resolution of our Company's General Meeting of Shareholders or by a resolution of our Company's Management Board with the approval of our Supervisory Board (if the Management Board has been authorized to do so by our Company's General Meeting of Shareholders). However, the securities laws of certain jurisdictions may restrict our ability to allow such holders of common shares to participate in offerings of securities of our Company and to exercise pre-emptive rights. Under the U.S. federal securities laws, the issuance of additional common shares must be registered, unless an exemption from registration is available. Accordingly, subject to certain exceptions, holders of the common shares in our Company with registered addresses, or who are resident or located in certain jurisdictions outside the Netherlands, including the United States, may not be eligible to exercise pre-emptive rights. As a result, such holders may experience dilution of their ownership and voting interests in our Company's share capital.

Share Price & Shareholder Rights - Risk 5

The market price of our common shares and American Depositary Receipts may be volatile, and holders of our common shares or American Depositary Receipts could lose a significant portion of their investment due to drops in the market price of our common shares and American Depositary Receipts.

The market price of our common shares and ADRs has, in the past, experienced fluctuation, including fluctuation that is unrelated to our performance, and this fluctuation may continue in the future. Specific factors that may have a significant effect on the market price for our common shares include, among others, the following: - Changes in stock market analyst recommendations or earnings estimates regarding our common shares, other companies comparable to our Company or other companies in the industries that our Company serves - Actual or anticipated fluctuations in our operating results or future prospects, which may be influenced by, among other things, changes in food retail industry conditions - Reaction to public announcements we make - Strategic actions taken by us or our competitors, such as acquisitions or restructurings - Our failure to achieve the anticipated benefits of the merger, including the anticipated cost savings, synergies, growth opportunities and other benefits, as rapidly as, or to the extent, anticipated by financial or industry analysts - The recruitment or departure of key personnel - Conditions or trends in the industries in which we operate, including new laws or regulations or new interpretations of existing laws or regulations or changes in the food retail industry - Announcements of investigations or regulatory scrutiny of our operations or lawsuits filed against us - Changes in tax or accounting standards, rulings, policies, guidance, interpretations or principles - Adverse conditions in the United States or international financial markets or general U.S. or international economic conditions, including those resulting from war, catastrophes, incidents of terrorism and responses to such events - Sales of our common shares or American Depositary Receipts by us, members of our management team or significant shareholders or holders of our American Depositary Receipts

Share Price & Shareholder Rights - Risk 6

There may be less publicly available information concerning our Company than there is for issuers that are not "foreign private issuers" because, as a "foreign private issuer," we are exempt from a number of rules under the Exchange Act and are permitted to file less information with the SEC than issuers that are not "foreign private issuers."

As a "foreign private issuer" under the Securities Exchange Act of 1934, as amended (referred to in this Form 20-F Report as the Exchange Act), we are exempt from certain rules under the Exchange Act, and are not required to file periodic reports and financial statements with the SEC as frequently or as promptly as companies whose securities are registered under the Exchange Act but are not "foreign private issuers," or to comply with Regulation FD, which restricts the selective disclosure of material non-public information. In addition, we are exempt from certain disclosure and procedural requirements applicable to proxy solicitations under Section 14 of the Exchange Act. The members of our Supervisory Board and Management Board, officers and principal shareholders are exempt from the reporting and "short-swing" profit recovery provisions of Section 16 of the Exchange Act. Accordingly, there may be less publicly available information concerning us than there is for companies whose securities are registered under the Exchange Act but are not "foreign private issuers," and such information may not be provided as promptly as it is provided by such companies. In addition, we may provide certain information in accordance with Dutch law, which may differ in substance or timing from such disclosure requirements under the Exchange Act.

Share Price & Shareholder Rights - Risk 7

We may terminate our Exchange Act reporting obligations if permitted by applicable law.

If we were to cease to be a reporting company under the Exchange Act, and to the extent not required in connection with any other debt or equity securities of our Company registered or required to be registered under the Exchange Act, the information now available to our shareholders and ADR holders in the annual and other reports required to be filed by us in the United States would no longer be available to them.

Share Price & Shareholder Rights - Risk 8

Due to delays in notification to and by the depositary, the holders of our American Depositary Receipts may not be able to give voting instructions to the depositary or to withdraw our common shares underlying their American Depositary Receipts to vote such shares in person or by proxy.

Despite our efforts, the depositary may not receive voting materials for our common shares represented by our American Depositary Receipts in time to ensure that holders of such American Depositary Receipts can either instruct the depositary to vote our common shares underlying their American Depositary Receipts or withdraw such shares to vote them in person or by proxy. In addition, the depositary's liability to holders of our American Depositary Receipts for failing to execute voting instructions, or for the manner in which voting instructions are executed, is limited by the deposit agreement relating to our American Depositary Receipts. As a result, holders of our American Depositary Receipts may not be able to exercise their rights to give voting instructions, or to vote in person or by proxy, and may not have any recourse against the depositary or our Company if their shares are not voted as they have requested or if their shares cannot be voted.

Accounting & Financial Operations3 | 6.1%

Accounting & Financial Operations - Risk 1

Declaration, payment and amounts of dividends, if any, to holders of our common shares will be uncertain and subject to a number of factors, including our profits and capital reserves under Dutch law, and distributions of operating earnings to our Company by our subsidiaries.

Whether any dividend is declared or paid to holders of our common shares, and the amounts of any dividends that are declared or paid, are uncertain and depend on a number of factors. We have the discretion to declare a dividend on our common shares, which may be based on a number of considerations, including our dividend policy, operating results and capital management plans and the market price of our common shares. In addition, the amount of any dividends that may be declared by our management board will be limited by Dutch law. Under Dutch law, we are permitted to make distributions to our shareholders only to the extent that our shareholders' equity exceeds the sum of the paid-in and called-up part of our issued share capital and the reserves that must be maintained under Dutch law and our articles of association, if any, as determined on the basis of our non-consolidated annual accounts. A distribution from the profits available for distribution will first be made to the holders of our cumulative preferred shares (if any) and then, if possible, to the holders of our cumulative preferred financing shares. Any profits remaining after these distributions and any additions to the reserves deemed necessary by our Supervisory Board, in consultation with our Management Board, will be at the disposal of our General Meeting of Shareholders for distribution to the holders of our common shares or addition to the reserves of our Company. Our ability to pay dividends, and the amounts of any dividends ultimately paid in respect of our common shares, will also be subject to the extent to which we receive funds, directly or indirectly, from our subsidiaries. The ability of our subsidiaries to make distributions to our Company will depend on satisfying the organizational documents and the applicable laws of the jurisdictions in which our subsidiaries are organized.

Accounting & Financial Operations - Risk 2

Future changes in accounting standards may result in increased levels of assets and debt being recognized on our Company's balance sheet.

Our Company's financial statements are prepared in accordance with IFRS as issued by the IASB. From time to time, the IASB issues new accounting standards or amendments to existing standards. The IASB issued a new standard on lease accounting in 2016, with an effective date for annual periods beginning on or after January 1, 2019. A consequence of this standard is to recognize substantially all leases on the balance sheet and thereby bring an end to off-balance sheet lease accounting. This will have a significant impact on many companies including those in the retail industry, due primarily to long-dated property leases. We or our respective subsidiaries have a large number of operating lease liabilities currently not included on the balance sheet but disclosed as commitments. When this new lease accounting standard becomes effective, it is expected that substantially all operating leases will be recognized in our financial statements, which would result in a significant increase in leased assets, liabilities and changes to the allocation of expenses within the income statement and which could have an adverse impact on various debt ratios and other key performance indicators of our Company.

Accounting & Financial Operations - Risk 3

If we do not generate positive cash flows, we may be unable to service our debt.

The mid- to long-term ability to pay principal, premium, if any, and interest on our debt will depend on the future operating performance of our and our respective subsidiaries businesses. Future operating performance will be subject to market conditions and business factors that will often be beyond our or their control. Consequently, we are not able to guarantee that there will be sufficient cash flows to pay the principal, premium, if any, and interest on our debt. If cash flows and capital resources are insufficient to allow us to make scheduled payments on our debt, we may have to take alternative measures, such as reducing or delaying capital expenditures, selling assets, seeking additional capital or restructuring or refinancing our debt. We are not able to guarantee that the terms of our debt will allow us to take these alternative measures or that these alternative measures, individually or in the aggregate, will allow us to satisfy our scheduled debt service obligations. If we cannot make scheduled payments on our debt, we will be in default and, as a result: - Our debt holders could declare all outstanding principal and accrued interest to be due and payable - Our lenders could terminate their commitments and commence foreclosure proceedings against our assets - We or one or more of our respective subsidiaries could be forced into bankruptcy or liquidation Certain of our debt agreements may contain covenants requiring us to maintain specified financial ratios and meet specific financial tests. Our failure to comply with these covenants could result in an event of default that, if not cured or waived, could result in our Company being required to repay these borrowings before their due date. If we were unable to make this repayment, or otherwise refinance these borrowings, our lenders could foreclose on our assets. If we were unable to refinance these borrowings on favorable terms, our business could be adversely impacted.

Debt & Financing2 | 4.1%

Debt & Financing - Risk 1

We have significant financial debt outstanding that could negatively impact our business.

We have significant debt outstanding. As of January 1, 2017, Ahold Delhaize's consolidated net debt was approximately €3,244 million, which represents approximately 9% of our total assets. Net debt is the difference between (i) the sum of loans, finance lease liabilities, cumulative preferred financing shares and short-term debt (i.e., gross debt) and (ii) cash, cash equivalents, current portion of available-for-sale financial assets, and short-term deposits and similar instruments. Our level of debt could: - Make it difficult for us to satisfy our obligations, including interest payments - Limit our ability to obtain additional financing for us and our respective subsidiaries to operate our businesses - Limit our financial flexibility in planning for and reacting to industry changes - Place our Company at a competitive disadvantage as compared to less leveraged companies - Increase our vulnerability to general adverse economic and industry conditions - Require our Company to dedicate a substantial portion of our cash flow to payments to our debt, reducing the availability of cash flow for other purposes We may borrow additional funds to support our capital expenditures, working capital needs to finance future acquisitions and for other purposes. The incurrence of additional debt could make it more likely that we will experience some or all of the risks described above. For additional information on liquidity and leverage risk, see Item 5 "Operating and Financial Review and Prospects –B. Liquidity and Capital Resources."

Debt & Financing - Risk 2

Increases in interest rates and/or a downgrade of our credit ratings could negatively affect financing costs and ability to access capital.

We are exposed to changes in interest rates with respect to our outstanding debt position and/or additional debt to the extent that we raise debt in the capital markets to meet maturing debt obligations, to fund our capital expenditures and working capital needs, and to finance future acquisitions. To manage interest rate risk, we have an interest rate management policy aimed at reducing volatility in its interest expense and maintaining a target percentage of its debt in fixed rate instruments. As of January 1, 2017, after taking into account the effect of interest rate swaps and cross-currency swaps, the entirety of our long-term debt was at fixed rates of interest. It is anticipated that our Company's daily working capital requirements will continue to be primarily financed with operational cash flow and through the use of various committed and uncommitted lines of credit. The interest rates on these short- and medium-term borrowing arrangements will generally be determined either as the inter-bank offering rate at the borrowing date plus a pre-set margin, or based on market quotes from banks. Although we may employ risk management techniques to hedge against interest rate volatility, significant and sustained increases in market interest rates could materially increase our financing costs and negatively impact our reported results. We will rely on access to bank and capital markets as sources of liquidity for cash requirements not satisfied by cash flows from operations. A downgrade in our credit ratings from the internationally-recognized credit rating agencies, particularly to a level below investment grade, could negatively affect our ability to access the bank and capital markets, especially in a time of uncertainty in either of those markets. A rating downgrade could also impact our ability to grow our businesses by substantially increasing the cost of, or limiting access to, capital. A credit rating is not a recommendation to buy, sell or hold debt, as the credit rating does not comment as to market price or suitability for a particular investor. The credit ratings assigned to our debt address the likelihood of payment of principal and interest pursuant to the terms of the debt. A credit rating is subject to revision or withdrawal at any time by the assigning rating agency. Each credit rating should be evaluated independently of any other credit rating that may be assigned to our securities and should only be viewed as the opinion of the assigning credit rating agency.

Corporate Activity and Growth7 | 14.3%

Corporate Activity and Growth - Risk 1

We will continue to incur integration, assimilation and restructuring costs following the merger.

We will continue to incur integration and restructuring costs following the merger, as we continue to integrate, assimilate and restructure the former Ahold and Delhaize businesses during the transition period following the merger. We cannot give any assurance that the realization of efficiencies related to the integration of the former Ahold and Delhaize businesses will offset the incremental integration and restructuring costs in the near term, if at all. An inability to realize these efficiencies could have an adverse effect on our businesses, subsequent integration, assimilation and restructuring and related transactions, cash flows, financial condition or operating results.

Corporate Activity and Growth - Risk 2

Uncertainties associated with the integration of Ahold and Delhaize may cause a loss of management personnel or other key employees, which could adversely affect our future business and operations.

We depend on the experience and industry knowledge of our officers and other key employees to execute our business plans. Our success depends, in part, upon our ability to attract and retain key management personnel and other key employees. Current and prospective employees may experience uncertainty about their roles within our and our respective subsidiaries' businesses post-merger, which may have an adverse effect on the ability to attract or retain key management and other key personnel. Accordingly, no assurance can be given that our and our respective subsidiaries' businesses will be able to attract or retain key management personnel or other key employees.

Corporate Activity and Growth - Risk 3

We may be unable to successfully integrate, assimilate and restructure the businesses of Ahold and Delhaize and the respective subsidiaries, and realize the anticipated benefits of the merger.

The merger involved the combination of two companies that operated as independent public companies. This requires devoting significant management attention and resources to integrating, assimilating and restructuring the businesses of the merged entities during the post-merger transition period. Potential difficulties we may encounter as part of this process include, but are not limited to, the following: - Inability to successfully coordinate the businesses, or particular business segments, of Ahold and Delhaize in a manner that permits our Company to enjoy the advantages of a complementary base of strong local brands and a strong financial profile for investing in future growth, to be able to provide a superior customer offering, to achieve the full cost synergies and other benefits anticipated to result from the merger, and to further expand our global market reach and customer base - Inability to achieve or maintain leading industry standards in quality and food retail offerings of the respective subsidiaries - Complexities associated with managing the respective businesses, including challenges of integrating or coordinating complex systems, technology, networks and other assets in a seamless manner that minimizes any adverse impact on customers, suppliers, employees and other constituencies - Continuing to provide consistent, high quality customer service during the period of integration and restructuring - Potential unknown liabilities and unforeseen expenses or delays associated with the merger, including but not limited to costs of integration and restructuring the former Ahold and Delhaize businesses that may exceed the costs that we anticipated prior to the execution of the merger agreement Any of the foregoing could adversely affect the ability to maintain relationships with customers, suppliers, employees and other constituencies, or the ability to achieve the anticipated benefits of the merger, or could reduce our earnings or otherwise adversely affect our businesses and financial results.

Corporate Activity and Growth - Risk 4

Our business relationships or those of our respective subsidiaries may be subject to disruptions due to uncertainty associated with the merger, which could have an adverse effect on our operating results, cash flows and financial position.

Parties with which we or our respective subsidiaries do business may experience uncertainty associated with the merger and related transactions, including with respect to our current or future business relationships or those of our respective subsidiaries. Our relationships or those of our respective subsidiaries may be subject to disruption as customers, suppliers and other persons with whom we or our respective subsidiaries have business relationships may delay or defer certain business decisions or might decide to seek to terminate, change or renegotiate their relationships with us or our respective subsidiaries, as applicable, or consider entering into business relationships with parties other than Ahold Delhaize or our respective subsidiaries.

Corporate Activity and Growth - Risk 5

We may be unable to successfully develop and execute our strategy, which may include, but is not limited to, completing renovations and conversions, implementing brand repositioning plans and growing our eCommerce business.

Our success depends in large part on the ability of our respective subsidiaries to operate their customers' preferred local supermarkets. If they are unable to successfully develop and execute a strategy, or if our plans fail to meet customers' expectations, our overall financial condition and operating results could be adversely affected. The introduction, implementation, success and timing of new business initiatives and strategies, including but not limited to initiatives to increase revenue, reduce costs or enter into new areas of business, could be less successful or could be different than anticipated, which could materially adversely affect our business. A key to our respective subsidiaries' business strategy is the renovation and/or conversion of existing stores, as well as the renovation of infrastructure. Although it is expected that cash flows generated from operations, supplemented by the unused borrowing capacity under our credit facilities and the availability of capital lease financing, will be sufficient to fund capital renovation programs and conversion initiatives, sufficient funds may not be available. The inability to successfully renovate and/or convert existing stores and other infrastructure could adversely affect our businesses, operating results and ability to compete successfully. In addition, we anticipate that many customers are increasingly shopping over our eCommerce websites – including delhaize.be, ah.nl, bol.com and Peapod – and mobile commerce applications. We anticipate that online and mobile shopping will continue to be a key component of growth for food retailers in years to come. Any failure by our respective subsidiaries to provide attractive, user-friendly online shopping platforms that meet the expectations of online shoppers and adapt to future developments and trends in eCommerce could place them and us at a competitive disadvantage, result in the loss of eCommerce and other sales, harm our reputation with customers and have a material adverse impact on the growth of our eCommerce business, operating results and ability to compete successfully.

Corporate Activity and Growth - Risk 6

We may be unsuccessful in managing the growth of our businesses or realizing the anticipated benefits of acquisitions we have made.

We may continue to reinforce our presence in the geographic locations where our respective subsidiaries currently operate, and in adjacent regions, by pursuing acquisition opportunities in the retail grocery industry and by opening new stores. We may also occasionally consider opportunities to expand into new regions. Realization of the anticipated benefits of an acquisition, store renovation, market renewal or store opening could take several years or may not occur at all. We face risks commonly encountered with growth through acquisition and conversion or expansion. The areas where we and our respective subsidiaries could face risks include: - Identifying suitable acquisition opportunities or markets in which to expand - Facing competitors who may have more resources to make acquisitions or expand operations or otherwise may make acquisitions that we would have been interested in pursuing - Diverting management's time and focus from operating the businesses to acquisition or integration challenges - Obtaining necessary financing on satisfactory terms - Making payments on the indebtedness that might be incurred as a result of these acquisitions - Losing customers of an acquired business - Entering markets where we have no or limited experience - Failing to assimilate the operations and personnel of acquired businesses - Failing to install and integrate all necessary systems and controls - Needing to integrate operations across different cultures and languages and to address the particular economic, currency, political, and regulatory risks associated with specific countries - Facing litigation or other claims or liabilities in connection with the acquired company, including claims from terminated employees, customers, former shareholders or other third parties There can be no assurance that we will be able to execute successfully on an acquisition and integration strategy or store openings. The failure to address these risks or other problems encountered in connection with past or future acquisitions and investments could have a material adverse effect on our businesses, financial condition and operating results.

Corporate Activity and Growth - Risk 7

Businesses and/or financial results could be negatively affected if divestitures are not successfully completed or if contingent liabilities materialize in connection with completed divestitures.

We regularly evaluate the potential disposition of assets and businesses that may no longer help meet our objectives. When we decide to sell assets or a business, we may encounter difficulties in finding buyers or alternative exit strategies on acceptable terms or in a timely manner, which could delay the achievement of our strategic objectives. We may also dispose of a business at a price, or on terms, less desirable than we had anticipated. In addition, we may experience greater dis-synergies than expected, and the impact of the divestiture on our revenue growth may be larger than projected. After reaching an agreement with a buyer or seller for the disposition of a business, we will be subject to satisfaction of pre-closing conditions as well as to necessary regulatory and governmental approvals on acceptable terms, which, if not satisfied or obtained, may prevent us from completing the transaction. Dispositions may also involve continued financial involvement in the divested business, such as through continuing equity ownership, guarantees, indemnities or other financial and commercial obligations. There can be no assurance that the anticipated benefits of our future divestiture strategies will be realized.

Legal & Regulatory

Total Risks: 8/49 (16%)Below Sector Average

Regulation3 | 6.1%

Regulation - Risk 1

Various aspects of our and our respective subsidiaries' businesses are subject to federal, regional, state and local laws and regulations in the United States, the Netherlands, Belgium and other countries, in addition to environmental regulations. Our compliance with these laws and regulations may require additional expenses or capital expenditures and could adversely affect our ability to conduct our business as planned.

In addition to environmental regulations, our and our respective subsidiaries' businesses are subject to federal, regional, state and local laws and regulations in the United States, the Netherlands, Belgium and other countries relating to, among other things, zoning, land use, workplace safety, public health, community right-to-know, store size, alcoholic beverage sales, tobacco sales and pharmaceutical sales. A number of jurisdictions regulate the licensing of supermarkets, including retail alcoholic beverage license grants. In addition, under certain regulations, we are prohibited from selling alcoholic beverages in certain of our stores. We are also subject to laws governing our relationships with employees, including minimum wage requirements, overtime, working conditions, collective bargaining, disabled access and work permit requirements. A number of laws exist that impose obligations or restrictions with respect to property access. Compliance with these laws could result in modifications to properties or prevent performing certain further renovations. Compliance with, or changes in, these laws could reduce revenue and profitability and could otherwise adversely affect our businesses, financial condition or operating results. In the past year, some notable events occurred in the political world of our market areas, including the Brexit referendum in the UK and the U.S. elections, which will directly or indirectly impact international trade and the legislative and regulatory environment across our markets. The outcome of the various national elections in Europe during 2017 might have implications as well. These political developments may have a material adverse effect in our businesses, financial condition and results of operations.

Regulation - Risk 2

We are subject to antitrust and similar legislation in the jurisdictions in which we operate.

We are subject to a variety of antitrust and similar legislation in the jurisdictions where we and our respective subsidiaries operate. In a number of markets, we have market positions that may make future significant acquisitions more difficult and may limit our ability to expand by acquisition or merger, if we wish to do so. In addition, we and our respective subsidiaries are subject to legislation relating to unfair competitive practices and similar behavior in many of the jurisdictions where our respective subsidiaries operate. We or they may be subject to allegations of, or further regulatory investigations or proceedings into, such practices. Such allegations, investigations or proceedings (irrespective of merit) may require the devotion of significant management resources to defending ourselves. In the event that such allegations are proven, there may be significant fines, damages awards and other expenses, and our reputations may be harmed, which could materially adversely affect our businesses, results of operation, financial condition and liquidity.

Regulation - Risk 3

Antitrust conditions imposed or to be imposed by the Belgian Competition Authority could have an adverse effect on Ahold Delhaize or could partly prevent the consummation of the merger as originally intended.

The Belgian Competition Authority approved the merger of Ahold and Delhaize Group on March 15, 2016, conditional upon our commitments to divest eight Albert Heijn stores, five Delhaize franchisee stores and a limited number of planned stores in Belgium to address competition concerns raised by the regulator. The fulfillment of these commitments was not a condition precedent to the completion of the merger. In view hereof, the merger has lawfully taken place effective as of July 24, 2016. We are conducting the divestment process in full compliance with these commitments. There can be no assurance, however, that the Belgian Competition Authority will not impose unanticipated conditions, terms, obligations or restrictions and that, to the extent that any such conditions, terms, obligations or restrictions are imposed, they will not have an adverse effect on Ahold Delhaize, impose additional material costs on, or materially limit, our revenues. Also, such unanticipated conditions, terms, obligations or restrictions could partly prevent the consummation of the merger as originally intended.

Litigation & Legal Liabilities3 | 6.1%

Litigation & Legal Liabilities - Risk 1

Unexpected outcomes in our legal proceedings could impact our financial performance.

From time to time, we or our respective subsidiaries are party to legal proceedings, including matters involving personnel and employment issues, personal injury, intellectual property, competition/antitrust matters, landlord-tenant matters, tax matters and other proceedings arising in the ordinary course of business. We estimate the exposure to the claims and litigation arising in the normal course of our business and make what we believe to be adequate provisions for this exposure. Unexpected outcomes in these matters could have an adverse effect on our financial condition and operating results. Additional legal proceedings, including the Greek litigation and proceedings involving our respective subsidiaries' operations or the operations of affiliated and franchised stores, are ongoing or may arise from time to time outside the ordinary course of business, for which outcomes could have an adverse effect on our financial condition and operating results. For further information, see Note 34 of Ahold Delhaize's consolidated financial statements included in Item 18 of this Form 20-F Report.

Litigation & Legal Liabilities - Risk 2

Claims based on U.S. civil liabilities may not be enforceable.

We are a company incorporated under Dutch law, and, as such, the rights of our shareholders and the civil liability of the members of our Supervisory Board and Management Board are governed by Dutch law and our Articles of Association. A substantial portion of our assets is located outside of the United States. In addition, certain members of our Management Board and Supervisory Board and certain of our executive officers reside outside the United States. As a result, it may be difficult for investors to effect service of process within the United States on us or such individuals, or to enforce outside the United States any judgments obtained against us or such persons in U.S. courts in any action, including actions predicated upon the civil liability provisions of the U.S. federal securities laws. In addition, it may be difficult for investors to enforce rights predicated upon the U.S. federal securities laws in original actions brought in courts in jurisdictions located outside the United States (including the Netherlands) or enforce claims for punitive damages. The United States and the Netherlands currently do not have a treaty providing for the reciprocal recognition and enforcement of judgments, other than arbitration awards, in civil and commercial matters. In addition, the countries of residence of the members of our Management Board and Supervisory Board and certain of our executive officers may also not have a treaty providing for the reciprocal recognition and enforcement of judgments. Consequently, a final judgment for payment given by a court in the United States, whether or not predicated solely upon U.S. federal securities laws, would not be enforceable in the Netherlands. However, if a person has obtained a final and conclusive judgment rendered by a U.S. court that is enforceable in the United States and files a claim with the competent Dutch court, the Dutch court will generally give binding effect to the foreign judgment to the extent it finds that the jurisdiction of the U.S. court has been based on grounds that are internationally acceptable and that proper legal procedures have been observed, that the foreign judgment does not contravene Dutch public policy and that the foreign judgment is not irreconcilable with a judgment of a Dutch court given between the same parties, or with an earlier judgment of a foreign court given between the same parties in a dispute involving the same cause of action and subject matter, provided that such earlier judgment fulfills the conditions necessary for it to be given binding effect in the Netherlands. It is uncertain whether this practice extends to default judgments as well. In addition, even if a judgment by a U.S. court satisfies the above requirements, the Dutch court may still deny a claim for a judgment if the U.S. court judgment is not, not yet or no longer formally enforceable according to the relevant U.S. state or federal laws. Dutch courts may deny the recognition and enforcement of punitive damages or other awards. Moreover, a Dutch court may reduce the amount of damages granted by a U.S. court and recognize damages only to the extent that they are necessary to compensate actual losses or damages. Enforcement and recognition of judgments of U.S. courts in the Netherlands are solely governed by the provisions of the Dutch Civil Procedure Code (Wetboek van Burgerlijke Rechtsvordering). There can be no assurance that our Company's U.S. shareholders will be able to enforce any judgments obtained in U.S. courts in civil and commercial matters, including judgments under the U.S. federal securities laws, against us or members of our Supervisory Board or Management Board or executive officers who are residents of the Netherlands or countries other than the United States.

Litigation & Legal Liabilities - Risk 3

Holders of our American Depositary Receipts will have limited recourse if our Company or the depositary fails to meet the respective obligations under the deposit agreement relating to our American Depositary Receipts or if they wish to involve our Company or the depositary in a legal proceeding.

The deposit agreement relating to our American Depositary Receipts expressly limits the obligations and liability of our Company and the depositary. Neither we nor the depositary will be liable to the extent that liability results from the fact that we or they: - Perform the respective obligations without gross negligence or willful misconduct - Take any action in reliance upon the advice of, or information from, legal counsel, accountants, any person presenting shares for deposit, any holder of American Depositary Receipts of our Company or any other qualified person - Rely on any documents we or they believe in good faith to be genuine and properly executed In addition, neither we nor the depositary are under any obligation to appear in, prosecute or defend any action, suit or other proceeding in respect of any of our American Depositary Receipts, which in our or their opinion may involve us or them in expense or liability, unless we or they are indemnified to our or their satisfaction. The provisions of the deposit agreement relating to our American Depositary Receipts limit the ability of holders of such American Depositary Receipts to obtain recourse if our Company or the depositary fails to meet the respective obligations under the deposit agreement or if they wish to involve us or the depositary in a legal proceeding.

Taxation & Government Incentives1 | 2.0%

Taxation & Government Incentives - Risk 1

Unexpected outcomes with respect to audits of tax filings in the jurisdictions where we or our respective subsidiaries operate could result in an adverse effect on our financial performance.

Because we and our respective subsidiaries operate in a number of countries, our businesses' income is subject to taxation in differing jurisdictions and at differing tax rates. Significant judgment is required in determining the consolidated income tax position. As a result of our multi-jurisdictional operations, we are exposed to a number of different tax risks including, but not limited to, changes in tax laws or interpretations of these tax laws. The tax authorities in the jurisdictions where our businesses operate may audit our tax returns and may disagree with the positions taken in those returns. While the ultimate outcome of such audits will not be certain, we will consider the merits of our filing positions in our overall evaluation of potential tax liabilities with the objective of having adequate liabilities recorded in our consolidated financial statements to meet potential exposures. An adverse outcome resulting from any settlement or future examination of our tax returns or any other tax audit could result in additional tax liabilities and could adversely affect our effective tax rate, which could have a material adverse effect on our financial position, operating results and liquidity. In addition, any examination by the tax authorities in the jurisdictions where our businesses operate could cause us to incur significant legal expenses and divert management's attention from the operation of the businesses.

Environmental / Social1 | 2.0%

Environmental / Social - Risk 1

Because of the number of properties that we own and lease, we have a potential risk of environmental liability associated with these properties.

We are subject to laws, regulations and ordinances that govern activities and operations that may have adverse environmental effects and impose liabilities for the costs of cleaning, and certain damages arising from sites of past spills, disposals or other releases of hazardous materials. Under applicable environmental laws, we could be responsible for the remediation of environmental conditions and could be subject to associated liabilities relating to our or our respective subsidiaries' stores, warehouses and offices, as well as the land on which they are situated, regardless of whether we lease, sublease or own the stores, warehouses, offices or land in question and regardless of whether such environmental conditions were created by us or by a prior owner or tenant. The costs of investigation, remediation or removal of environmental conditions may be substantial, and these costs may increase if stricter laws are passed or applicable environmental laws are more strictly enforced. Certain environmental laws also impose liability in connection with the discharge, storage, handling, disposal of, or exposure to, hazardous or toxic substances, including materials containing asbestos, pursuant to which third parties may seek recovery from us or owners, tenants or sub-tenants of real properties for personal injuries associated with such substances or materials. There can be no assurance that environmental conditions relating to prior, existing or future store sites will not harm us through, for example, business interruption, cost of remediation or harm to reputation, which could have a material adverse effect on our financial position, operating results and liquidity.

Macro & Political

Total Risks: 8/49 (16%)Above Sector Average

Economy & Political Environment2 | 4.1%

Economy & Political Environment - Risk 1

General economic factors may adversely affect our financial performance.

General economic conditions in the areas where our respective subsidiaries operate may adversely affect our overall financial performance. Factors such as higher interest rates, higher fuel and other energy costs, weakness in the housing market, inflation, deflation, higher levels of unemployment, unavailability of consumer credit, higher consumer debt levels, higher tax rates and other changes in tax laws, overall economic slowdown and other economic factors could adversely affect consumer demand for the products our respective subsidiaries sell, require a change in the mix of products that are sold to one with a lower average profit margin and result in slower inventory turnover and greater markdowns on inventory. Higher interest rates, higher fuel and other energy costs, higher transportation costs, inflation, higher costs of labor, insurance and healthcare, foreign exchange rate fluctuations, higher tax rates and other changes in tax laws, changes in other laws and regulations and other economic factors could increase the cost of sales and selling, general and administrative expenses, and otherwise adversely affect operations and operating results. These factors could affect not only our respective subsidiaries operations, but also the operations of suppliers from whom they purchase goods, which could result in an increase in the cost to our Company of the goods sold to customers.

Economy & Political Environment - Risk 2

Our respective subsidiaries' operations are subject to economic conditions that impact consumer spending.

Operating results are sensitive to changes in overall economic conditions that impact consumer spending, including discretionary spending, in the areas where we operate, including Greece. Consumers may reduce spending or change their purchasing habits due to certain economic conditions such as decreasing employment levels, slowing business activity, increasing interest rates, increasing energy and fuel costs, increasing healthcare costs and increasing tax rates. In Greece, the occurrence of certain economic policy developments, such as the implementation of capital controls or the potential exit from the Eurozone, could have an adverse impact on consumer spending and cause us to impair assets related to our operations in Greece and record lower contributions from those assets in our operating results. A general reduction in the level of consumer spending or the inability to respond to shifting consumer preferences regarding products, store location and other factors in the markets where our respective subsidiaries operate could adversely affect growth and profitability.

International Operations1 | 2.0%

International Operations - Risk 1

Our international operations subject us to numerous risks.

We are a global company incorporated in the Netherlands with key suppliers operating internationally. We may further expand our business and operations into new countries. The international nature of our business and operations subjects us to risks inherent in operating in or selling products imported from foreign countries, including government regulation; political and economic instability; currency restrictions; fluctuations and other restraints; import and export restrictions; complex and burdensome tax regimes; additional tax assessments in foreign jurisdictions; risks of expropriation; threats to employees; terrorist activities, including extortion; and risks of U.S. and foreign governmental regulation and action in relation to these operations.

Natural and Human Disruptions2 | 4.1%

Natural and Human Disruptions - Risk 1

Natural disasters and geopolitical events could adversely affect financial performance.

The occurrence of one or more natural disasters, such as hurricanes, earthquakes, tsunamis, pandemics or severe weather, whether as a result of climate change or otherwise, or geopolitical events, such as civil unrest in a country in which we or our respective subsidiaries operate or in which our suppliers are located, and attacks disrupting transportation systems, could adversely affect operations and financial performance. Such events could result in physical damage to one or more of properties, a temporary closure of one or more stores or distribution centers, a temporary lack of an adequate work force in a market, a temporary decrease in customers in an affected area, a temporary or long-term disruption in the supply of products from some local and overseas suppliers, a temporary disruption in the transport of goods from overseas, a delay in the delivery of goods to distribution centers or stores within a country in which our respective subsidiaries are operating, or a temporary reduction in the availability of products in their stores. These factors could otherwise disrupt and adversely affect operations and financial performance.

Natural and Human Disruptions - Risk 2

The significance of the contributions of our U.S. businesses to our revenues and the geographic concentration of our respective subsidiaries' U.S. operations on the East Coast of the United States make us vulnerable to economic downturns, natural disasters and other catastrophic events that impact that region.

A total of 62% of our revenues (excluding discontinued operations) during the financial year ended January 1, 2017, was generated through our respective subsidiaries U.S. operations. We depend in part on these U.S. operations for dividends and other payments to generate the funds necessary to meet financial obligations. Substantially all of the U.S. operations are located on the East Coast of the United States. Consequently, the operations depend significantly upon economic and other conditions in this area, in addition to those that may affect the United States or the world as a whole. Our operating results as a whole may suffer based on a general economic downturn, natural disaster, change in regulations or other adverse condition impacting the East Coast of the United States.

Capital Markets3 | 6.1%

Capital Markets - Risk 1

Turbulence in the global credit markets and economy may adversely affect our financial condition and liquidity and of our respective subsidiaries.

Disruptions in the capital and credit markets could adversely affect our ability and of our respective subsidiaries to draw on our bank credit facilities or enter into new bank credit facilities. Access to funds under our bank credit facilities is dependent on the ability of the banks that are parties to the facility agreements to meet their funding commitments. Those banks may not be able to meet their funding commitments to our Company and our respective subsidiaries, if they experience shortages of capital and liquidity or if they experience excessive volumes of borrowing requests from our Company and our respective subsidiaries and other borrowers within a short period of time. Also, disruptions in the capital and credit markets may impact our ability and of our respective subsidiaries to renew bank credit facilities or enter into new bank credit facilities as needed. In addition, our suppliers and third-party service providers could experience credit or other financial difficulties that could result in their inability to supply us with necessary goods and services in a timely fashion or at all.

Capital Markets - Risk 2

Unfavorable exchange rate fluctuations may negatively impact our financial performance.

Our respective subsidiaries' operations are conducted primarily in the United States, the Eurozone countries of the Netherlands, Luxembourg, Belgium, Germany and Greece and to a lesser extent in other parts of Europe outside the Eurozone, including the Czech Republic, Romania and the Republic of Serbia. Although our historical financial information is being presented in euros, during the financial year ended January 1, 2017, we derived approximately 67% of our revenues from subsidiaries that have functional currencies other than the euro. The operating results and the financial position of each of our entities outside the Eurozone are accounted for in the relevant local currency, including the U.S. dollar, and are then translated into euros at the applicable foreign currency exchange rate for inclusion in our consolidated financial statements. Exchange rate fluctuations between these local currencies, including the U.S. dollar, and the euro could have a material adverse effect on our consolidated financial statements. Because a substantial portion of our assets, liabilities and operating results are denominated in currencies other than our presentation currency, the euro, we are particularly exposed to currency risk arising from fluctuations in the value of these currencies against the euro.

Capital Markets - Risk 3

The market price of our American Depositary Receipts and dividends paid on our common shares underlying our American Depositary Receipts may be materially adversely affected by fluctuations in the exchange rate for converting euros into U.S. dollars.

Fluctuations in the exchange rate for converting euros into U.S. dollars may affect the value of our American Depositary Receipts and the common shares underlying them. Specifically, as the relative value of the euro to the U.S. dollar declines, each of the following values will also decline (and vice versa): - The U.S. dollar equivalent of the euro trading price of our common shares in Amsterdam or Brussels, which may consequently cause the market price of our American Depositary Receipts in the United States to also decline - The U.S. dollar equivalent of the proceeds that a holder of our American Depositary Receipts would receive upon the sale in Amsterdam or Brussels of any of our common shares withdrawn from the depositary - The U.S. dollar equivalent of cash dividends paid in euro on our common shares represented by ADRs.

Production

Total Risks: 7/49 (14%)Below Sector Average

Employment / Personnel2 | 4.1%

Employment / Personnel - Risk 1

A competitive labor market, changes in labor conditions or labor disruptions such as strikes, work stoppages and slowdowns may increase our respective subsidiaries' costs or negatively affect their financial performance.

Our success depends in part on our and our respective subsidiaries' ability to attract and retain qualified personnel in all the businesses, including executives to lead them. We compete with other businesses in our markets in attracting and retaining employees. Tight labor markets, increased overtime, collective bargaining agreements, increased healthcare costs, government-mandated increases in the minimum wage and a higher proportion of full-time employees could result in an increase in labor costs, which could materially impact our respective subsidiaries' operating results. A shortage of qualified employees may also require increases in wage and benefit offerings to compete effectively in the hiring and retention of qualified employees or to retain more expensive temporary employees. A number of our Company's and our respective subsidiaries' employees, both inside and outside of the United States, are members of unions. It is possible that relations with the unionized portion of some or all of those workforces could deteriorate or that the workforces could initiate a strike, work stoppage or slowdown in the future. Similar actions by the non-unionized workforces of our Company or the respective subsidiaries are also possible. In such an event, our respective subsidiaries' businesses, cash flows, financial condition and operating results could be negatively affected, and we or they may not be able to adequately meet the needs of customers by utilizing the remaining unaffected workforce. Further, as existing collective bargaining agreements are expected to expire, we or our respective subsidiaries who are signatory to such agreements may not be able to negotiate extensions to, or replacements for, such agreements on acceptable terms, which could result in work stoppages or other costs, which could be disruptive to business, lead to adverse publicity and have a material adverse impact on cash flows, financial condition and operating results. While we believe that relations with our employees and those of our respective subsidiaries will continue to be good, we will always face the risk that legislative bodies may approve laws that liberalize the procedures for union organization, and there can be no assurance that our non-unionized employees will not become unionized. If more of our workforce becomes unionized, it could affect our operating expenses. Increased labor costs could increase our costs, resulting in a decrease in our profits or an increase in our losses. There can be no assurance that we will be able to fully absorb any increased labor costs through our efforts to increase efficiencies in other areas of our operations.

Employment / Personnel - Risk 2

Increasing costs associated with our defined benefit pension plans may adversely affect our operating results, financial position or liquidity.

Most of our businesses and those of our respective subsidiaries have pension plans, the structures and benefits of which vary with conditions and practices in the countries concerned. Pension benefits are provided through defined contribution plans or defined benefit plans. A defined contribution plan is a post-employment benefit plan under which the employing company and/or the employee has an obligation to pay limited contributions to a separate entity. Under such a plan, there are no legal or constructive obligations to pay further contributions, regardless of the performance of the funds held to satisfy future benefit payments. The actual retirement benefits are determined by the value of the contributions paid and the subsequent performance of investments made with these funds. A defined benefit plan is a post-employment benefit plan that normally defines an amount of benefit that an employee will receive upon retirement, usually dependent on one or more factors such as age, years of service, compensation and/or guaranteed returns on contributions made. Assumptions related to discount rates, inflation, interest crediting rate and future salary increases or mortality rates have a significant impact on our funding requirements related to these plans. These estimates and assumptions may change based on actual return on plan assets, changes in interest rates, demographic situation and governmental regulations. Therefore, our funding requirements could change and additional contributions could be required in the future. In addition, a significant number of our respective subsidiaries have union employees in the United States who are covered by multi-employer plans (referred to in this Form 20-F Report as MEPs). An increase in the unfunded liabilities of these MEPs may result in increased future payments by us and the other participating employers. In addition, we may become obligated for a MEP's unfunded obligations if other participating employers cease to participate in the plan. Similarly, if a number of employers cease to have employees participating in the MEP, we could be responsible for an increased share of the MEP's deficit. If we withdraw from an MEP, we may be required to pay the MEP an amount based on the underfunded status of the MEP, referred to as a withdrawal liability. Since any of the respective subsidiaries with union employees who are covered by a MEP are only one of several employers participating in most of our MEPs and there is no reliable basis to accurately determine its share of plan obligations and assets following defined benefit principles, these MEPs are not included in our balance sheet. We may be required to pay significantly higher amounts to fund U.S. employee healthcare plans in the future. Significant increases in healthcare and pension funding requirements could have a material adverse effect on our financial position, operating results and liquidity.

Supply Chain2 | 4.1%

Supply Chain - Risk 1

Risks associated with the suppliers from whom products are sourced could adversely affect financial performance.

Significant disruptions in the operations of vendors and suppliers could materially impact our respective subsidiaries' businesses by disrupting store-level product selection or increasing costs, resulting in reduced sales. The products they sell are sourced from a wide variety of domestic and international suppliers. If disruptions should occur, the ability to find qualified suppliers who meet their standards, and to access products in a timely and efficient manner, could be significantly challenged. Political and economic instability in the countries in which suppliers are located, suppliers' financial instability or failure to meet required standards, labor problems experienced by suppliers, the availability of raw materials to suppliers, competition for products from other retailers,the impact of adverse weather conditions, product quality issues, currency exchange rates, transport availability and cost, inflation, deflation, and other factors relating to the suppliers and the countries in which they are located are beyond our control. In addition, tariffs and other impositions on imported goods, trade sanctions imposed on certain countries, the limitation on the importation of certain types of goods or of goods containing certain materials from other countries and other factors relating to foreign trade are beyond our control. These factors and other factors affecting the suppliers and access to products could result in decreased product selection and increased out-of-stock conditions, as well as higher product costs, which could adversely affect our respective subsidiaries operations and financial performance.

Supply Chain - Risk 2

A change in supplier terms could adversely affect our financial performance.

Our respective subsidiaries receive allowances, credits and income from suppliers primarily for volume incentives, new product introductions, in-store promotions and co-operative advertising. Certain of these funds are based on the volume of net sales or purchases, growth rate of net sales or purchases and marketing programs. If they do not grow our net sales over prior periods or if they are not in compliance with the terms of these programs, there could be a material adverse effect on the amount of incentives offered or paid to them by the suppliers. Additionally, suppliers routinely change the requirements for, and the amount of, funds available. No assurance can be given that the respective subsidiaries will continue to receive such incentives or will be able to collect outstanding amounts relating to these incentives in a timely manner, or at all. A reduction in, the discontinuance of, or a significant delay in receiving these incentives, as well as the inability to collect incentives, could have a material adverse effect on our businesses, results of operations and financial condition.

Costs3 | 6.1%

Costs - Risk 1

We may fail to realize some or all of the anticipated cost savings, synergies, growth opportunities and other benefits of the merger, which could adversely affect the value of our ordinary shares and American Depositary Receipts.

The achievement of the anticipated benefits of the merger is subject to a number of uncertainties, including whether we are able to integrate, assimilate or restructure the merged businesses in an efficient and effective manner, and general competitive factors in the marketplace. Failure to achieve these anticipated benefits could result in increased costs, decreases in revenues and diversion of management's time and energy and could materially impact our businesses, cash flows, financial condition or operating results. If we are not able to successfully achieve these objectives, the anticipated cost savings, synergies, growth opportunities and other benefits may not be realized fully or at all, or may take longer to realize than expected. It is possible that the integration, assimilation and restructuring process could take longer or be more costly than anticipated or could result in the loss of key employees; the disruption of our ongoing businesses; or inconsistencies in standards, controls, procedures and policies that adversely affect our ability to maintain the respective businesses' relationships with clients, customers and employees, to achieve the anticipated benefits of the merger or to maintain quality standards. Integration efforts may also divert management's time and energy. An inability to realize the full extent of, or any of, the anticipated benefits of the merger, as well as any delays encountered in the integration process, could have an adverse effect on our business, cash flows, financial condition or operating results, which may affect the value of our ordinary shares and American Depositary Receipts. In addition, the integration, assimilation and restructuring of Ahold's and Delhaize's businesses may result in additional and unforeseen expenses and capital investments, and the anticipated benefits of the integration, assimilation and restructuring plans may not be realized. Actual cost synergies, if achieved at all, may be lower than we expect and may take longer to achieve than anticipated. If we are not able to adequately address these challenges, we may be unable to successfully integrate, assimilate or restructure Ahold's and Delhaize's businesses, or to realize the anticipated benefits of the integration, assimilation or restructuring of the businesses.

Costs - Risk 2

We may experience adverse results arising from claims against our self-insurance programs.

We manage our insurable risks through a combination of self-insurance and commercial insurance coverage. Our and our respective subsidiaries' operations in the United States are self-insured for workers' compensation, general liability, property, vehicle accident and certain health care-related claims. Self-insurance liabilities are estimated based on actuarial valuations. While we believe that our actuarial estimates are reasonable, they are subject to a high degree of variability and uncertainty caused by such factors as future interest and inflation rates; future economic conditions; litigation and claims; settlement trends and results; legislative and regulatory changes; changes in benefit levels; and the frequency and severity of incurred-but-not-reported claims. It is possible that the final resolution of some claims may require significant expenditures in excess of existing reserves. In addition, third-party insurance companies that provide the fronting insurance that is part of the self-insurance programs require us to provide certain collateral. We assess and monitor the financial strength and credit-worthiness of the commercial insurers from which we purchase insurance. However, we remain exposed to a degree of counterparty credit risk with respect to these insurers. If conditions of economic distress were to cause the liquidity or solvency of our counterparties to deteriorate, we may not be able to recover collateral funds or be indemnified from the insurer in accordance with the terms and conditions of our policies.

Costs - Risk 3

If we are unable to locate appropriate real estate or enter into real estate leases on commercially acceptable terms, our respective subsidiaries may be unable to open new stores.

The ability to open new stores depends on success in identifying and entering into leases on commercially reasonable terms for properties that are suitable for the needs of our respective subsidiaries. If they fail to identify and enter into leases on a timely basis for any reason, including inability due to competition from other companies seeking similar sites, growth may be impaired because they may be unable to open new stores as anticipated. Similarly, our respective subsidiaries businesses may be harmed if they are unable to renew the leases on existing stores on commercially acceptable terms.

Ability to Sell

Total Risks: 4/49 (8%)Below Sector Average

Competition1 | 2.0%

Competition - Risk 1

Our results are subject to risks relating to competition and pressure on profit margins in the food retail industry.

The food retail industry is competitive and generally characterized by pressure on profit margins. Our competitors include international, national, regional and local supermarket chains, supercenters, independent grocery stores, specialty food stores, warehouse club stores, retail drug chains, convenience stores, membership clubs, general merchandisers, discount and online retailers and restaurants. It is possible that we could face increased competition in the future from some or all of these competitors. In addition, consolidation in the food retail industry due to increasing competition from larger companies is also likely to continue. Food retail businesses generally compete on the basis of location, quality of products, service, price, product variety, store condition and eCommerce offerings. The ability to maintain our current position depends upon the ability of our respective subsidiaries to compete in the food retail industry through various means such as price promotions, continued reduction of operating expenses where the cost savings are reinvested in our Company, enhancing customer offerings and store expansions. To the extent that prices are reduced to maintain or grow market share, net income and cash generated from the respective subsidiaries' operations could be adversely affected. Some of our competitors may have financial, distribution, purchasing and marketing resources that are greater than ours, and there is no assurance that we will be able to successfully compete in the markets where our respective subsidiaries operate. Profitability could be impacted as a result of the pricing, purchasing, financing, advertising or promotional decisions made by our competitors. Such an impact on profitability could have an adverse effect on our business and the businesses of our respective subsidiaries, cash flows, financial condition or operating results, which may affect the value of our common shares and American Depositary Receipts.

Sales & Marketing3 | 6.1%

Sales & Marketing - Risk 1

As a result of selling products, we face the risk of exposure to product liability claims and adverse publicity.

The preparation, packaging, marketing, distribution and sale of products purchased from others entail an inherent risk of product liability, product recall and resultant adverse publicity. These products may contain contaminants or other hazards that may be inadvertently redistributed by our respective subsidiaries. These contaminants or other hazards may, in certain cases, result in illness, injury or death if processing at the foodservice or consumer level does not eliminate the contaminants or other hazards. Even an inadvertent shipment of adulterated, contaminated or defective products may lead to an increased risk of exposure to product liability claims. There can be no assurance that these claims will not be asserted against us or our respective subsidiaries that we or they will not be obligated to perform such a recall in the future. If a product liability claim is successful, insurance may not be adequate to cover all liabilities incurred, and we may not be able to continue to maintain such insurance, or obtain comparable insurance at a reasonable cost, if at all. If our businesses do not have adequate insurance or contractual indemnification available, product liability claims relating to defective products could have a material adverse effect on the ability to successfully market products and on our businesses, financial condition and operating results. In addition, even if a product liability claim is not successful or is not fully pursued, the negative publicity surrounding any assertion that our products were defective, or caused illness, injury or death, could have a material adverse effect on the reputations of us and our respective subsidiaries with existing and potential customers and on our businesses and financial condition and operating results.

Sales & Marketing - Risk 2

We are subject to risks related to corporate responsibility and sustainable retailing.

Many factors influence our reputation and the value of our respective subsidiaries' brands, including perceptions of our Company held by our key stakeholders and the communities in which we do business. Increased regulatory demands, concerns about climate change, stakeholder awareness and the growing sentiment that large retailers should address sustainability issues across the entire supply chain mean that our respective subsidiaries' brands and reputations could suffer if we, our suppliers or our other business partners do not adequately address, or are perceived as not adequately addressing, relevant corporate responsibility issues affecting the food retail industry.

Sales & Marketing - Risk 3

Risks associated with our franchised and affiliated stores could adversely affect our financial performance.

As of January 1, 2017, 25% of the stores in our store network were franchised or affiliated (that is, stores with one of our Company's banners and operated by independent third parties to whom we sell our products at wholesale prices) and 8% of our revenues are generated from our franchise or affiliate activities and are part of retail sales. The operators of our affiliated and franchised stores operate and oversee the daily operations of their stores and are independent third parties. Although we attempt to properly select, train and support the operators of our affiliated and franchised stores, the ultimate success and quality of any affiliated or franchised store will rest with the third party operators. If the operators of the affiliated and franchised stores do not successfully operate in a manner consistent with our standards, our image and reputation could be harmed, which could adversely affect our business and operating results. In addition, we have accounts receivable associated with the franchised and affiliated stores. If the third party operators of these stores do not operate successfully, we could be forced to write-off a portion of or all of the accounts receivable associated with such franchised and affiliated stores.

Tech & Innovation

Total Risks: 2/49 (4%)Below Sector Average

Technology2 | 4.1%

Technology - Risk 1

There are inherent limitations in our control systems, and misstatements due to error or fraud may occur and not be detected, which may harm our business and financial performance and result in difficulty meeting our reporting obligations.

Effective internal control over financial reporting is necessary for us to provide reasonable assurance with respect to our financial reports and to effectively prevent fraud. If we cannot provide reasonable assurance with respect to our financial reports and effectively prevent fraud, our reputation, business and operating results could be harmed. Internal control over financial reporting may not prevent or detect misstatements because of our inherent limitations, including the possibility of human error, the circumvention or overriding of controls, or fraud. Therefore, even effective internal controls can provide only reasonable assurance with respect to the preparation and fair presentation of financial statements. In addition, projections of any evaluation of the effectiveness of internal control over financial reporting to future periods are subject to the risks that the control may become inadequate because of changes in conditions or that the degree of compliance with policies or procedures may deteriorate. If we fail to maintain the adequacy of our internal controls, including any failure to implement required new or improved controls, or if we experience difficulties in our integration and implementation of changes to our internal controls, the businesses and operating results could be harmed and we could fail to meet our reporting obligations.

Technology - Risk 2

Operations are dependent on information technology (IT) systems, the failure or breach of security of any of which could harm the operations and our and our respective subsidiaries reputations and adversely affect our overall financial performance.

Many of our functions of our respective subsidiaries operations are dependent on IT systems developed and maintained by internal experts or third parties. It is possible that we may encounter unforeseen technical complexities or issues that we may be unable to resolve, or that the resolution of complexities or issues may require management to devote more attention than anticipated to such matters. The failure of any of these IT systems could also cause disruptions in operations, adversely affecting sales and profitability. There are recovery plans in place to reduce the negative impact of IT systems failures on our operations, but there is no assurance that these recovery plans will be completely effective in doing so. Any of these risks may cause us to incur unanticipated costs and may prevent us from obtaining the expected benefits and cost savings of the IT systems or from obtaining benefits and cost savings as soon as expected. As part of normal operations, both we and our respective subsidiaries receive and store confidential information about customers (including credit/debit card information), employees and other third parties in our own systems and through our third-party service providers. These third-party service providers are used for a variety of reasons, including, without limitation, encryption and authentication technology, content delivery to customers, back-office support, and other functions. In addition, online operations depend upon the secure transmission of confidential information over public networks, including information permitting cashless payments. Any failure to protect confidential data could materially damage our brand and reputation, and those of our respective subsidiaries, and result in significant expenses and disruptions to operations and loss of customer confidence and subject us to litigation, any of which could have a material adverse impact on our business and results of operations. To protect against security breaches and rapidly evolving cyber threats, we maintain administrative, physical and technical security measures to protect, and to prevent unauthorized access to, such information. There are security processes, protocols and standards in place that are applicable both internally and to our third-party service providers to protect information from systems to which they have access under their engagements with us. Inherent to our businesses, we face attempts – such as phishing, malware and distributed denial-of-service attacks – to access the information stored in our information systems or to disrupt our IT systems. We have not been subject to intrusions of our network security, nor have we experienced any other cyber attack incidents, which, individually or in the aggregate, have been material to our or our respective subsidiaries' businesses, financial condition and operations. We have cyber risk insurance that includes business interruption and recovery cost coverages up to a limit of $150 million to protect against both third-party damages and expenses resulting from a privacy breach and first-party damages and costs incurred as a result of a cyber attack incident.

See a full breakdown of risk according to category and subcategory. The list starts with the category with the most risk. Click on subcategories to read relevant extracts from the most recent report.

FAQ

What are “Risk Factors”?

Risk factors are any situations or occurrences that could make investing in a company risky.

The Securities and Exchange Commission (SEC) requires that publicly traded companies disclose their most significant risk factors. This is so that potential investors can consider any risks before they make an investment.

They also offer companies protection, as a company can use risk factors as liability protection. This could happen if a company underperforms and investors take legal action as a result.

It is worth noting that smaller companies, that is those with a public float of under $75 million on the last business day, do not have to include risk factors in their 10-K and 10-Q forms, although some may choose to do so.

How do companies disclose their risk factors?

Publicly traded companies initially disclose their risk factors to the SEC through their S-1 filings as part of the IPO process.

Additionally, companies must provide a complete list of risk factors in their Annual Reports (Form 10-K) or (Form 20-F) for “foreign private issuers”.

Quarterly Reports also include a section on risk factors (Form 10-Q) where companies are only required to update any changes since the previous report.

According to the SEC, risk factors should be reported concisely, logically and in “plain English” so investors can understand them.

How can I use TipRanks risk factors in my stock research?

Use the Risk Factors tab to get data about the risk factors of any company in which you are considering investing.

You can easily see the most significant risks a company is facing. Additionally, you can find out which risk factors a company has added, removed or adjusted since its previous disclosure. You can also see how a company’s risk factors compare to others in its sector.

Without reading company reports or participating in conference calls, you would most likely not have access to this sort of information, which is usually not included in press releases or other public announcements.

A simplified analysis of risk factors is unique to TipRanks.

What are all the risk factor categories?

TipRanks has identified 6 major categories of risk factors and a number of subcategories for each. You can see how these categories are broken down in the list below.

1. Financial & Corporate

Accounting & Financial Operations - risks related to accounting loss, value of intangible assets, financial statements, value of intangible assets, financial reporting, estimates, guidance, company profitability, dividends, fluctuating results.
Share Price & Shareholder Rights – risks related to things that impact share prices and the rights of shareholders, including analyst ratings, major shareholder activity, trade volatility, liquidity of shares, anti-takeover provisions, international listing, dual listing.
Debt & Financing – risks related to debt, funding, financing and interest rates, financial investments.
Corporate Activity and Growth – risks related to restructuring, M&As, joint ventures, execution of corporate strategy, strategic alliances.

2. Legal & Regulatory

Litigation and Legal Liabilities – risks related to litigation/ lawsuits against the company.
Regulation – risks related to compliance, GDPR, and new legislation.
Environmental / Social – risks related to environmental regulation and to data privacy.
Taxation & Government Incentives – risks related to taxation and changes in government incentives.

3. Production

Costs – risks related to costs of production including commodity prices, future contracts, inventory.
Supply Chain – risks related to the company’s suppliers.
Manufacturing – risks related to the company’s manufacturing process including product quality and product recalls.
Human Capital – risks related to recruitment, training and retention of key employees, employee relationships & unions labor disputes, pension, and post retirement benefits, medical, health and welfare benefits, employee misconduct, employee litigation.

4. Technology & Innovation

Innovation / R&D – risks related to innovation and new product development.
Technology – risks related to the company’s reliance on technology.
Cyber Security – risks related to securing the company’s digital assets and from cyber attacks.
Trade Secrets & Patents – risks related to the company’s ability to protect its intellectual property and to infringement claims against the company as well as piracy and unlicensed copying.

5. Ability to Sell

Demand – risks related to the demand of the company’s goods and services including seasonality, reliance on key customers.
Competition – risks related to the company’s competition including substitutes.
Sales & Marketing – risks related to sales, marketing, and distribution channels, pricing, and market penetration.
Brand & Reputation – risks related to the company’s brand and reputation.

6. Macro & Political

Economy & Political Environment – risks related to changes in economic and political conditions.
Natural and Human Disruptions – risks related to catastrophes, floods, storms, terror, earthquakes, coronavirus pandemic/COVID-19.
International Operations – risks related to the global nature of the company.
Capital Markets – risks related to exchange rates and trade, cryptocurrency.

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