Koninklijke Ahold Delhaize N.V.

Frederic van Daele - Vice President, Investor Relations Frans Muller - President and Chief Executive Officer Pierre Bruno Charles Bouchut - Executive Vice President and Chief Financial Officer

Edouard Aubin - Morgan Stanley John Kershaw - Exane BNP Paribas Fabienne Caron - Kepler Cheuvreux James Grzinic - Jefferies & Co. Xavier Le Mene - BofA Merrill Lynch Borja Olcese - JPMorgan Alan Vandenberghe - KBC Securities

Thank you, operator and good morning everyone. Welcome to Delhaize Group's conference call regarding our first quarter 2015 results.

I want to remind you that today's presentation and discussion will include forward-looking statements. We want to caution you that such statements are predictions and that actual events or results can differ materially.

Factors that may have a material effect on our business are detailed in the cautionary note in our earnings release and are contained in our SEC filings. These statements are made as of the date of this presentation, and Delhaize Group assumes no obligation to update this information.

Today we have the following people with us Frans Muller, CEO of Delhaize Group; and Pierre Bouchut, CFO of Delhaize Group. During this call, we will first reflect on the first quarter performance, followed by comments on our operations and afterwards, we will take questions.

For those unable to stay on the call or wish to listen to the call again, a replay will be available on the Group’s website. Frans the floor is yours now.

Thank you very much, Frederic. Welcome, everyone, on this conference call where we discuss our first-quarter performance.

I move straight to Slide number 4, as you will be familiar with our strategic framework, which I've discussed at earlier occasions. Slide 4, provides an overview of the highlights of this quarter.

At Delhaize America, we have been able to maintain a healthy comparable sales store growth at both our Food Lion and Hannaford, which was also reflected in positive real in positive real growth at broadly the same rate as in the previous quarter. However, it has been a quarter with a degree of volatility.

Firstly, similarly to last year's first quarter, we had a significant positive impact from winter weather. We actually believe that the impact of both the years is comparable.

While this positively helps revenues, it makes planning difficult and we also experience extra costs related to snow removal. Secondly, we are currently seeing a significant drop in retail and input cost inflation.

Thirdly, as earlier indicated, we do see some more competition, mainly at Food Lion. Given these factors, we are pleased with our performance and believe that both Food Lion and Hannaford have, at least, retained market share.

Our underlying operating profit in the U.S. increased by 2.5% in absolute levels and the underlying operating margin remained flat.

Gross margin improved, but was compensated by higher SG&A. We, nevertheless, believe that we are on the track for having relatively a flat SG&A as a percentage of sales and flat UOP margin at Delhaize America for the full year.

At Delhaize Belgium, our results were affected by the transformation plan, for which an agreement was signed only at the end of February. This has provided still a high level of uncertainty for our associates.

Let me now briefly update you where we are. We have more than 1,500 associates who've signed up to take one of the redundancy packages, of which nearly 1,000 associates will go on early retirement.

They will start leaving the Company as from this May. There will be a second opportunity for our associates to sign up for voluntary leave in the fourth quarter of the year.

The first stores to operate under the new organization are scheduled for June, and we are making good progress on affiliating the nine stores that were selected and agreed on. Our operating performance this quarter was impacted.

Although we lost 87 basis points of market share this quarter, our revenue and market share trend gradually improved. We are optimistic to see positive revenue growth in the second half of the year, in combination with a gradually improvement in our profitability.

In Southeastern Europe we were pleased to see that we continued to gain market share in all three countries. In Greece, our same-store sales trend improved, although it did remain negative.

We are mindful of the uncertain macroeconomic, but trading conditions were not really impacted this quarter. In Serbia, our sales trend improved, helped by same-store sales growth, which was, to some degree, the result of the success of our remodeled Maxi supermarkets.

Our Tempo hypermarkets are still impacted, although we are optimistic that trends will improve as well. Our Tempo new-generation store received a positive response in revenues and customer feedback when it opened just a few weeks ago.

Mega Image in Romania continued to grow, albeit at a slower pace, as we hardly opened any stores this quarter. I will be back later to highlight our priorities for the year.

I will now hand to Pierre to discuss our financial performance in more detail.

Thank you, Frans; and good morning to everyone. Let me now review our Q1 2015 and financial results.

Slide 5 provides you with our summary Q1 income statements. At €5.8 billion our revenues increased by 15.8% at actual FX rates and by 2.2% at identical exchange rates.

Organic growth for the quarter also stood at 2.2%. Our gross margin reached 24.4% and increased by three basis points compared to last year at identical exchange rate.

This is explained by the following factors. First, there was a gross margin decrease of almost 100 basis points at Delhaize Belgium primarily higher promotion, price investments, and the limited impact of retail deflation on our gross margin.

Second gross margin increased in Southeastern Europe by approximately 70 basis points, largely due to the elimination of our low-margin transit sales operation in Serbia, but also by improved procurement terms in all the three countries in the region. Third, the gross margin in the US increased by 20 basis points due to lower cost inflation, improved supplier terms, and a better sales mix.

This was partly offset by higher shrink. Our SG&A for the Group stood at 21.9% of sales an increase by 44 basis points compared to last year at identical FX rates.

This increase is the outcome of four factors. First, negative sales leverage and €4 million higher advertising expenses in Belgium, where SG&A increased by 80 basis points.

Two, higher SG&A in Southeastern Europe for 10 basis points. Three, 20 basis points increase in SG&A at Delhaize America, which relates to higher staff costs compared to a particularly low first quarter 2014.

Four, we also accelerated depreciation both in the US and in Belgium for a total amount of €6 million or 10 basis points, as a result of our remodeling program in those two countries. At €173 million our Q1 UOP increased by 4.4% at actual rates, but decreased by 11.2% at identical rates.

Our UOP margin reached 3%, down 43 basis point at identical rates, mainly due to difficult results in Belgium, which is still in recovery phase. We also had expenses this quarter, which were not included in our underlying operating profit.

We have decided to reorganize our procurement and merchandising function within Delhaize America to now integrate them at vendor level in order to create a more customer-focused organization. This resulted in €3 million of restructuring expenses this quarter with about €# million more to come for the full Group in the remainder of the year.

We also took a legal provision in Belgium and store impairment charge of €7 million for the US and Belgium combined. When taking into account €96 million of net finance cost, €13 million of income tax expenses, and a loss of €8 million in discontinued operation, we recorded a Group share in net profit of €28 million compared to €80 million last year.

Net finance cost increased up to €11 million as a result of the US dollar versus Euro FX rate evolution; and up to €41 million as a result of a one-off charge relating to the US bond buyback, which took place in February this year, and which should allow us to save approximately $25 million in interest expenses on an annual basis over the two coming years. Our free cash flow was negative in this first quarter and amounted to minus €93 million.

But for the full year, everything being equal, we nevertheless expect to generate a healthy free cash flow of approximately €400 million based on the Q1 FX rate of $1.13 million and excluding approximately €80 million of cash out related to the transformation plan in Belgium. Slide 6, shows the evolution of our EBITDA and underlying EBITDA in Q1.

As you can note at actual exchange rates our EBITDA progressed by 5.1% and our underlying EBITDA by 11.2% up to €339 million. At identical exchange rate our EBITDA decreased by 9.5%, while our underlying EBITDA decreased by 3.5% to €294 million.

Let me highlight that our underlying EBITDA evolution of minus 3.5% is clearly more resilient than our UOP evolution of minus 11.2%. This is because our UOP has been affected by non-cash elements and mainly accelerated depreciation in the U.S.

and Belgium with our intensive remodeling program. The following Slide 7 gives you more insight on the revenue evolution at Delhaize America over Q1.

In Q1 we reported a same-store sales growth of 2.5%. Retail inflation has decreased fairly rapidly since the beginning of the year and stood at 1.2% for the quarter.

The timing of Easter promotion and price decreases of around 7% in milk, and 5% to 6% in produce in March are the main drivers of this inflation slowdown. Real growth was positive at 1.3% for two U.S.

banners combined and, in fact, slightly higher than in Q4 last year. While both Food Lion and Hannaford experienced positive real growth, the competitive activity was more intense in the Southeast.

We estimate the impact of severe winter weather to be broadly similar to what we experienced last year at approximately 180 basis points. When taking into account the positive 50 basis point calendar impact and a 20 basis point positive impact from store openings, our Q1 organic growth stands at 3.2%, Slide 8, provides you with background information on our underlying operating margin evolution at Delhaize America in Q1.

We reported a Q1 UOP margin of 3.8%, flat compared to Q1 last year. The following elements have impacted our UOP margin in this first quarter.

First, the 20 basis point increase in staff cost, short term incentives, pension and healthcare benefits, which is mostly due to the comparison with Q1 2014, which was particularly low. Second, higher shrink for approximately 20 basis points partly due to increased focus on fresh at Food Lion.

Third, other costs such as IT expenses, easy fresh and affordable one-off costs, and snow removal costs, also contributed to upward pressure on SG&A in this first quarter. Globally, our good momentum in sales did offset the upward pressure on cost and resulted in a flat UOP margin for this first quarter.

At this stage, for the full-year 2015 and versus 2014, we expect flat SG&A as a percentage of sales and a UOP margin of 3.9 in the U.S. all that on a 52 week comparable basis in 2014.

Actually, we anticipate to stabilize both staff cost and shrink as a percentage of sales for the full year versus last year. The next slide presents Delhaize Belgium sales evolution.

In Q1, Delhaize Belgium comparable store sales decreased by 2.8%. We have been suffering from sales disruption until late February when we reached a final agreement with the unions on our transformation plan.

Our internal retail inflation stayed negative at minus 0.4% as we continue to carry out significant price investments, which impacted both our top line and our margin in Q1. With a negative calendar impact of 10 basis points and the positive 50 basis points from network expansion Delhaize Belgium revenue growth stand at minus 2.4%.

Following the agreement with the unions, we are now busy with the implementation of our transformation plan. However, as you know, our number one priority in Belgium is to regain customers.

We are clearly encouraged by the evolution of our market share over the last six months. In Q4 2014, it stood at a low 24.1%, in Q1 2015 it reached 24.4% and for the last six weeks until April 15 it was an average 24.6%.

The decline versus the comparable period of the prior year is, therefore, progressively reducing from 117 basis points in Q4 2014, to 87 basis points in Q1 2015, to 55 basis points on average for the last six week. This trend is, of course, a cause for satisfaction and shows that Delhaize Belgium is on track to regain customer confidence.

As shown on Slide 10, Delhaize Belgium's underlying operating profit margin decreased by a significant 170 points over Q1, from 3.1% in Q1 2014 to 1.4% in Q1 this year. This 170 basis point drop is explained by several elements.

First, price investment and promotion for our next 65 basis point. Second, higher advertising cost for 40 basis points.

Three, higher supply chain cost for 30 basis points, including the negative impact of our e-commerce operation. And four, higher SG&A for 35 basis points, including accelerated depreciation relating to additional store remodeling for 20 basis points.

All together the negative sales leverage accounts for 60 basis points out of the 170 basis point decrease. We still expect our UOP margin in Belgium to remain under pressure in Q1 and Q2 with a recovery in Q4.

On Slide 11 we provide you with the revenue evolution of our Southeastern Europe segment. Our same-store sales for Q1 stand at minus 0.8% for the segment.

While same-store was negative in Q1, both same-store sales and re-growth have improved compared Q4 for the three countries. Greece's same-store sales is impacted by the macro environment in the country, but to a lesser extent than in previous quarters.

In Serbia, we posted positive same-store sales which was in particulars reported by double digit sales uplift in our successfully 21 fully remodeled Maxi stores. In Romania, Mega Image reported same-store sales growth despite a low challenging market.

We now have 411 stores in Romania, which even increase of 109 stores compared to the end of the first quarter of last year. In all three countries we continue to gain market share.

In Greece the market share of Alfa-Beta expanded by 90 basis points. In Serbia our share grew by approximately 50 basis point to 14% and also in Romania, Mega Image continue to improve the market share.

With the positive 20 basis point Canada effect and 650 basis point positive impact from store openings, our organic growth stand at 5.9% in Southeastern Europe. On this following chart we provide you with more details on the margin evolution for Southeastern Europe.

The European margin increased by 40 basis points from 1.9% in Q1 2014 to 2.3% in Q1 2015. The main drivers of this improvement are, firstly, the reduction in low-margin revenues in Serbia where we terminated transit operations over the course of 2014 and where our wholesale revenues also decline.

Secondly, we manage to improve procurement terms in each of the countries as a result of our continued expansion and our solid current profile vis-a-vis our peers, notably in Serbia and Greece. The following Slide, 13, provides you a waterfall analysis of our cash flow generation at actual FX rates in this first quarter.

Our Q1 operating free cash flows to that minus $107 million. With a relatively unchanged EBITDA and CapEx, the negative €150 million evolution of our free cash flow versus Q1 of last year can be mainly explain by the following factors.

First of all, approximately €35 million due to higher taxes paid over Q1. Two, €35 million due to the timing of the payment of salaries, resulting from the impact of the 53rd week last year on biweekly salary payments at Delhaize America.

Three, approximately €20 million due to startup issues linked to the implementation of SAP cycle in Belgium since we have temporarily been not able, in a position, to offset our suppliers payable with receivables. And four, approximately €10 million due to increased benefit in the U.S.

short-term incentive and healthcare mainly. With the proceeds from Bottom Dollar's divestitures for €40 million, our total free cash flow for Q1 was minus €93 million.

Finally, our net debt increased by €235 million to $1.2 billion, which was largely due to the strengthening of the U.S. dollar versus the euro, but also to the €93 million negative free cash flow the €14 million premium paid related to U.S.

bond buyback and €55 million proceeds relating to the exercise of stock options. Free cash flow generation remain a priority for us this year.

Our objective is to generate a healthy level of free cash flow in 2015 of approximately €450 million at Q1 exchange rate and €80 million of cash outlook related to the transformation plan. Our efforts in terms of capital discipline and working capital have recently been recognized by Standard & Poor's, who has raised our credit rating outlook from stable to positive.

I now hand over to Frans to give you an update on our operations.

Thank you, Pierre. I would now like to discuss our priorities for the remainder of the year, which are actually centered around two strategic initiatives, as you know: the further rollout of Easy, Fresh & Affordable Food Lion and the implementation of the transformation plan in Belgium.

I will discuss Food Lion first. We recently hosted an analyst and investor visit in Wilmington, North Carolina, so I believe that you are sufficiently up to speed.

We are currently focused on rolling out the strategy to the next 160 es in the ready market. At this moment, we have more than 80 stores already under remodeling with the first stores already being finalized.

We are on schedule to complete this program in the fourth quarter with, as planned, an average capital spending of €1.5 million per store and €325,000 of one-off expenses per store. We also discussed in March that we still need to fine-tune the performance in the first 76 stores.

Like we said in March, the sales performance continues to be in line with our expectation. However, in terms of profitability there is still some work to do on shrink and on labor.

We are optimistic that we will be able to resolve these two issues soon. This means that we can use these valuable earnings on costs when launching the strategy in Raleigh later in the year.

Now some update on what is currently going on in the rest of the Food Lion network. We have completed the rollout of then new checkout technology to the last 200 stores in the first quarter.

We have progressed with the center store assortment rollout, which is now largely complete. And finally, we are making progress with the rollout of our revamped private brands.

By the end of March approximately 25% of the new products were already in the stores, representing 1,250 SKUs. Hannaford will continue to focus on accelerating growth.

We discussed in March how we want to leverage our strength in quality fresh foods and in customer service. We will run a number of pilots on fresh assortment and service this year, and we plan to open a smaller format of 20,000 square feet this summer.

We will also continue with the rollout of Hannaford To Go, our click and collect proposition, to an additional 15 stores this year. Let's now move to Belgium.

I already managed - mentioned that we have started the implementation of our transformation plan with over 1,500 associates signed up for a redundancy package. To make sure the transformation plan is executed well, the project and management office is tracking the progress on a very regular basis.

Other initiatives we are taking with respect to the transformation plan include: careful planning on the HR impact of the departure of such a large number of our associates; the implementation of the new store organization, which we will start to roll out in June; the affiliation of the nine stores where we have decided to stop the Company-managed activities; and we are planning on an increase in remodelings by the summer and we will the first conclusions of the four pilot stores. Currently, we plan for 16 store remodels in 2015.

From a commercial perspective, our goal this year is to have more customers than last year and part of the increased spend on advertising is allocated to more impactful promotions. We already saw results with our wine promotion in March, for example.

Let me repeat, that we expect to see positive same-store sales growth in the second half of the year, in combination with positive evolution in terms of our profitability. In Southeastern Europe the priority this year is to continue our growth path.

In Greece we have managed to open eight stores and we're optimistic about our market share trends and about further store growth. Also, in Romania, the priority is further store network, further network growth and market share growth, while in Serbia our progress is more focused on remodels.

Our early success in the first quarter bodes well for this program. Additionally, we have now started to gain pace also at Tempo with the first next generation stores to open this year, and one just opened, and the second is scheduled for the summer.

Before moving to the questions you might have, we have summarized the outlook for 2015 on Slide 15. In the U.S.

we remain focused on maintaining sales momentum, in spite of a heightened level of competition and lower inflation. We expect a relatively stable UOP margin for Delhaize America.

In Belgium we expect positive comparable sales growth in the second part of the year, combined with a gradual improvement in profitability. For Southeastern Europe we expect Greece and Romania to continue their expansion, while Serbia continues to focus on sales improvement coupled with a good level of profitability.

We expect Group capital expenditure of approximately €700 million at identical exchange rates of €1.33 to $2, using the Q1 average exchange rate of €1.13 this translates into CapEx of approximately €765 million. We will continue to be disciplined with respect to operating costs, capital allocation and working capital, and plan to continue generating a healthy level of free cash flow, as Pierre already mentioned.

I now would like to open up for questions, so please operator could give us instructions and lead the Q&A session.

Yes, good morning guys. Just one question on U.S.

like-for-like, and one on free cash flows. So on the US like-for-like momentum, could you just comment on the exit rate in Q1 and how Q2 started?

And, based on your early expectations, should we expect a lower like-for-like sales in Q2 than the 2.5% you posted in Q1, despite the comparison basis getting a bit easier, given that inflation seems to be slowing down in the U.S.? Related to that, aren't we looking in the U.S.

in terms of like-for-like at the transition year as you kind of start losing the momentum that you had following the price repositioning that you achieved at the end of 2013 and you failed to get the benefit this year from Fresh, Easy and Affordable? And just lastly, sorry it's a bit of a long question, but on free cash flow, Pierre, you've given a guidance for €150 million.

Versus the initial expectation you had for the year, isn't it a touch below, because I had in mind around €500 million? And, if indeed it's a touch below, what is the delta versus your initial expectation?

Regarding free cash flow, we are in line with our original expectation; we never guided very precisely the market. What we are saying here, so that to avoid any misunderstanding, is €450 million at prevailing Q1 FX rate of 1.1 or 1.13 precisely, $1.13 or €1, and excluding an estimated severance cash impact of the transformation plan for about €80 million this year.

As already mentioned by Frans, 1,560 people have already applied for the redundancy package and we do expect some additional people by the end of the year, so that we reach a total number of 1,808 in Q4, with a relative payment of severance packages at that time. So no big change.

As you know we said approximately €450, so it’s a guidance, which is precise but nothing prevents us from doing better.

Okay.

The US in terms of like for like, it's a question which is fairly uneasy, because as we tried to explain it, the inflation slowed down in Q1, but mainly in March. This is due to - as I mentioned, it's some real price deflation in some categories of product, such as produce and milk, for instance; I mention it precisely.

But it certainly also has something to do with Easter, which was earlier this year. So, it's a bit uneasy to answer your question, but we have the feeling really that our sales would not be supported, as they were in Q4, by a solid inflation, food inflation.

On the other hand, we're happy in Q1 as we reported it, to show higher growth volume. For the coming quarters, we have the impact of Easy, Fresh and Affordable, we have this unknown about inflation in the U.S., so it's a bit uneasy to give precise figures.

But to come back precisely to your long question, my long answer would be to say that, as of the end of April, no change in our same-store sales evolution I would say in the U.S.

Okay thank you.

And we expect for the full year an inflation in the U.S. of 1% to 1.5%, which is lower than the last year.

So the real term sales growth in different profile.

Good morning guys. Just to follow up on Edouard's question, if…

John could cover little bit close to the phone, because we cannot hear you.

One second. Better?

Hello.

Much better. Thank you.

Perfect. Just following on from Edouard's question, if most of the inflation came - deflation came late in the quarter in the U.S., and you're saying you had 180 basis points of benefit from the snow storms, I suppose it was the same year-on-year.

But just help us understand, was your exit run rate of like for like nearer sort of 0.5% to 1% level? Or is the underlying still a case of its 2% plus?

So that's the first clarification point. Secondly, expand a little bit more on the competitive dynamics, because you've been taking a good bit of share from people for the last couple of years, so clearly there's going to be a fight back at some point.

You mentioned Wal-Mart Neighborhood stores I think, but perhaps expand on that? And finally, just a clarification, when do you finalize the new store model in Belgium?

Is it still in trial or did you say you'll roll it out from June?

On your first question, John, as Pierre already mentioned we have also some Easter effect to take with us, so as we all know the outcome of April, I think we can make a better comparison, so it's a little bit difficult to say more on that. On the U.S., I said that we think that at least we'll have retained market share, where in Q4 both our Food Lion and for Hannaford we gained market share of 20 to 30 basis points.

If we compare it to the marketplace, then we think that we have taken this from a few more peripheral operators with bigger boxes. Going forward I think for the bigger boxes this will be the case as well.

And the third question was on the trial stores in Belgium. We will assess those four stores as we started them some time ago in summer of this year we have 16 remodeling planned for this year - those will not all be stores in the same type of remodeling phase because the stores we have done now are, let's say, fit for more affluent areas for which we see a potential in Belgium of roughly 35 stores, so it's only a part of our network.

But we do that assessment of those four stores in July of this year.

Sorry, my point on Belgium was more about the labor model and whether it's in rollout from June or it's a trial with the new structure that you've agreed with the unions from June, just to understand how quickly the cost comes out. And just back to the U.S., because you had the snow benefit, presumably if we strip that out, the underlying moment, just for clarification, is, say, 2.5 minus 150 basis points - just to clarify that's the correct understanding of what you're saying.

What we said, and I thought I was precise, is that the impact of snow storms in Q1 this year was identical and estimated at about 180 basis points than last year.

Okay, so the underlying momentum is still the 2-plus-% like for like?

That's clear, a number.

On the new store organization, John, this we'll start in June that rollout of the new work charts including also to work with new teams, because a number of experienced associates will leave the Company. So this will start in June and we go in a few batches and we have to see how fast we can do this, but if it goes well then, of course, we will accelerate.

Okay, thank you very much guys.

Thank you.

Yes, good morning. [Technical difficulty].

Fabienne we lost you completely, you are out of the line.

Yes, good morning guys, hopefully you can hear me okay, just had a quick question on Easy, Fresh & Affordable, can you perhaps help us put into context better your confidence on improving on the shrink and labor numbers. So can you give us more confidence on how that improves over the balance of the program please?

Thank you.

Thank you, James; you were heard loud and clear. We did our 76 stores in Wilmington and Greenville from a test and pilot perspective, as I mentioned before.

We changed a lot of things as you know, both in center store, but also in front-line checkout, and therefore labor, and also in all the fresh parameter. So a lot of change for the Food Lion model coming from where they were into Easy, Fresh & Affordable.

This takes some adjustments in reordering processes and strength management, including your supply chain takes some adjustments in scheduling your labor for your checkouts, and getting used to the new equipment, and so on. We believe that we will be very much in line with our pro forma before the grand opening in Raleigh.

We have confidence that we make all the progress here.

And Frans, can you just perhaps help us understand where the shrink challenge is, bigger than the labor challenge, or vice versa?

No, different store by store; it has also to do with some competitive elements and the timing you should forget that Greenville only had a little more than three opening weeks in 2014, so it's still a very young organization. Wilmington is already much further in that progression and learning curve.

But we take the whole model to pro forma and colleagues strongly believe that this is possible; roughly, to give you an idea; shrink and labor are equally balanced.

Got it, thank you.

Thank you.

Good morning. Xavier Le Mene, Merrill Lynch.

Two questions if I may. Just a first one on the US inflation, so you are reporting 1.2%.

How does it compare actually with the market? You said you're gaining market share, but do we have to see that your current inflation is lower than the average of the market.

Can you just elaborate a bit on that? The second point, you said that - correct me if I'm wrong that Easy, Fresh & Affordable will be slightly dilutive to margin in full-year 2015.

So you are guiding for 3.9% EBIT margin in the US, so 10 bps down year on year. Is it what we should see potentially going forward in terms of dilution, so can you just elaborate a bit more on the 3.9% margin guidance in the US, and the impact on the new concept?

No, what we said is that on a 52 week comparable basis we are gaining the market at the same level of UOP margins for Delhaize America in 2015 than in 2014.

Regarding the inflation, we have no reason to believe that our inflation figure is higher than the U.S. global food retail figures.

It is true that we have been investing, in some fresh categories at Food Lion; and that may be a part of it is driven by some price investment in some categories, as I mentioned in produce, in milk among others, in fresh in general.

According to the market trend, what we see in produce, and dairy and therefore milk. But, of course, it might differ retailer by retailer, but based on the mix of the categories.

But we are in line with the normal inflation in the markets where we compete.

Okay, thank you.

Thank you. Hi, all.

Just a couple from me, can you please remind us of the volume uplift you're currently seeing from the Fresh & Easy initiative? And secondly if you can make a comment on - as to where the competitive activity you have seen in the U.S.

relates more to Food Lion specifically. I think you mentioned Wal-Mart, but perhaps make a comment on Harris Teeter as well?

Thank you.

We gave in March already some data on Wilmington and on Greenville for the Easy, Fresh & Affordable pilot stores; we have nothing to add at this moment. On the competitive environment in the Southeast we mentioned the openings of the Wal-Mart Neighborhood stores in our geography.

And talking about Harris Teeter, we see some more margin invest - we think pricing investment on Harris Teeter, but we still have a very comfortable price difference to them, and that field did not dramatically change, although they have been slightly more promotional than they had been before. And furthermore, we see in some areas, for example like Charlotte, the public's coming in.

But, at the moment, that is not a big amount of stores. I think that is really what we can say about this.

Okay, thanks a lot for the color.

Operator, can we take our last question please.

Yes, good morning gentlemen. Thanks for having my question.

I just had one question left. I was wondering if you could provide a bit more detail on the type of profitability improvement that you are expecting in Belgium over 2H 2015, and maybe also indicate when you are expecting the inflection point?

Thank you.

Good, understandable question. The first quarter, as you know, on February 23 we signed up our agreement with the social partners.

Up until that moment, there was, of course, a lot of insecurity with the associates. At the moment, we have people signing up for those redundancy packages and people leaving in May.

So we have on the labor side of the store, a mentality side still some insecurities amongst our store teams. On the other hand we see some good market share developments on the side of our promotions, which are working on our price investments on bringing the brand of Delhaize back to where it was.

And we feel that this - we need to put 2015 year to come back to our original market share. On the UOP profitability to give you some feel, and is also the number which is in our planning, we see a profitability of at least 2%.

Okay, thank you all for participating in today's conference call. A replay is available on the website, as I already mentioned.

If you have any additional questions do not hesitate to contact the Investor Relations department. Delhaize Group will announce our second quarter results on Thursday, July 30, 2015 I would like to thank you again and wish you all a nice day.