Royal Ahold · 20-F · For 12/31/00

Filed On 4/9/01 4:27pm ET   ·   SEC File 1-12510   ·   Accession Number 950127-1-252

Annual Report of a Foreign Private Issuer   ·   Form 20-F
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 1: 20-F        Annual Report of a Foreign Private Issuer            138±   472K 
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20-F   ·   Annual Report of a Foreign Private Issuer
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UNITED STATES 
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 FORM 20-F
(Mark One)                                                                      

[ ]    Registration Statement pursuant to Section 12 (b) or (g)       
of the Securities Exchange Act of 1934
or
[X]          Annual Report pursuant to Section 13 or 15(d)            
of the Securities Exchange Act of 1934
 for the fiscal year ended December 31, 2000
or
[ ]        Transition report pursuant to Section 13 or 15(d)          
of the Securities Exchange Act of 1934
for the transition period from..... to .......
Commission file number 0-18898
Koninklijke Ahold N.V.
(Exact name of Registrant as specified in its charter)
 Royal Ahold
 (Translation of Registrant's name into English)
 The Netherlands
 (Jurisdiction of incorporation or organization)
 Albert Heijnweg 1, 1507 EH Zaandam, The Netherlands
(Address of principal executive offices)

Securities registered or to be registered pursuant to Section 12(b) of the Act: 
Title of each class                    Name of each exchange on which registered
Common Shares at a par value of                          New York Stock Exchange
EUR 0.25 each, represented by                                               
American Depositary Shares                                                  

Securities registered or to be registered pursuant                              
  to Section 12(g) of the Act:                                             None.
Securities for which there is a reporting obligation                            
  pursuant to Section 15(d) of the Act:                                    None.

Indicate the number of outstanding shares of each                           
of the issuer's classes of capital or common                            
stock as of the close of the period covered by                          
the Annual Report:                                                      
Cumulative Preferred Shares par value EUR 500                           
      per share                                                            None.
Cumulative Preferred Financing Shares par value                         
      EUR 0.25 per share                                             259,317,164
    Common Shares par value EUR 0.25 per share                       816,849,445

Indicate  by check mark  whether the  registrant  (1) has filed all reports     
required to be filed by Section 13 or 15(d) of the Securities Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  registrant  was
required  to file  such  reports),  and  (2) has  been  subject  to such  filing
requirements for the past 90 days.                                              
Yes [X] No [ ]

Indicate by check mark which  financial  statement  item the registrant has     
elected to follow.                                                              
 Item 17 [ ] Item 18 [X]

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TABLE OF CONTENTS 

                                                                            Page

GENERAL INFORMATION........................................................    1

PART I                                                                          
Item 1.   Identity of directors, senior management and advisers............    4
Item 2.   Offer statistics and expected timetable..........................    4
Item 3.   Key information..................................................    4
Item 4.   Information on the Company.......................................    7
Item 5.   Operating and financial review and prospects.....................   24
Item 6.   Directors, senior management and employees.......................   39
Item 7.   Major shareholders and related party transactions................   45
Item 8.   Financial information............................................   47
Item 9.   The offer and listing............................................   49
Item 10.  Additional information...........................................   50
Item 11.  Quantitative and qualitative disclosures about market risk.......   59
Item 12.  Description of securities other than equity securities...........   61

PART II                                                                         
Item 13.  Defaults, dividend arrearages and delinquencies..................   62
Item 14.  Material modifications to the rights of security holders and          
          use of proceeds..................................................   62
Item 15.  [Reserved].......................................................   62
Item 16.  [Reserved].......................................................   62

PART III                                                                        
Item 17.  Financial Statements.............................................   63
Item 18.  Financial Statements.............................................   63
Item 19.  Exhibits.........................................................  108

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GENERAL INFORMATION                                                             

The consolidated  financial  statements of Koninklijke Ahold N.V., also referred
to as "we",  "us",  "our",  "Royal Ahold" or "Ahold",  appear in Item 18 of this
annual report. Our consolidated  financial statements are prepared in accordance
with accounting principles generally accepted in The Netherlands ("Dutch GAAP").
Dutch  GAAP  differs  in  certain  material  respects  from  generally  accepted
accounting  principles  in the United  States  ("U.S.  GAAP").  The  differences
between  Dutch GAAP and U.S.  GAAP which  materially  affect  our  reported  net
earnings and shareholders' equity are explained in the notes to the consolidated
financial  statements,  followed by a reconciliation  of Dutch GAAP net earnings
and shareholders' equity to amounts computed under U.S. GAAP.                   

     We are domiciled in The  Netherlands,  which is one of the  countries  that
participate in the European Economic and Monetary Union (the "European Union" or
the "EU").  Prior to fiscal year 1999,  the reporting  currency of our financial
statements  was the Dutch guilder  ("NLG").  Effective from fiscal year 1999, we
have  adopted the euro as our  reporting  currency,  the new  currency of the EU
("euro" or "EUR").  The Council of the European Union fixed effective January 1,
1999 the official  exchange rate between the euro and the Dutch guilder at EUR 1
= NLG 2.20371 (the "fixed rate"). Our financial  statements for fiscal year 1998
and certain other data included in this annual report were originally  stated in
Dutch  guilders or "NLG",  but we have  converted  them to euros using the fixed
rate.  As a significant  portion of our business is based in the United  States,
exchange  rate  fluctuations  between the euro,  or the Dutch guilder for fiscal
years prior to 1999, and the United States dollar,  referred to as "dollar", "$"
or "USD", are among the factors that have influenced year-to-year  comparability
of consolidated earnings and equity. The weighted average rate of the dollar per
euro that we used in the preparation of our  consolidated  financial  statements
was:                                                                            

o    USD 0.9232 for fiscal 2000                                                 
o    USD 1.0638 for fiscal 1999                                                 
o    USD 1.1100 for fiscal 1998                                                 

The year end rates of the dollar per euro that we  applied  to  balances  in the
consolidated financial statements were:                                         

o    USD 0.9424 as of December 31, 2000                                         
o    USD 1.0075 as of January 2, 2000                                           

The rates for fiscal 1998 included above were converted from the originally used
Dutch Guilder rate to euros using the fixed rate.                               

The rates used in the preparation of our consolidated  financial  statements may
vary in  certain  minor  respects  from  the rate in New  York  City  for  cable
transfers in foreign currencies as certified for customs purposes by the Federal
Reserve Bank of New York ("noon buying rate"). The noon buying rate for the euro
was USD 0.8794 per EUR 1.00 on March 30, 2001.                                  

Solely for convenience of the reader,  this annual report contains  translations
between  certain euro  amounts and dollar  amounts at  specified  rates.  Unless
otherwise indicated, we have translated euros into dollars at a rate of EUR 1.00
= USD 0.9424 which is equal to the exchange rate that we used in the preparation
of our 2000  balance  sheet.  Except  for  amounts  translated  for  convenience
purposes,  we have  translated  certain foreign  currency  balance sheet amounts
included in this annual report into euros using the exchange rate  prevailing as
of the end of our reporting period. We have translated  certain foreign currency
income  statement  amounts  included in this annual  report into euros using the
weighted average exchange rate during our reporting period.                     

Our fiscal year generally consists of 52 weeks and ends on the Sunday nearest to
December  31 of each  calendar  year.  The  quarters  that  we use  for  interim
financial reporting are determined as follows:                                  

o    the first quarter consists of the first 16 weeks of the fiscal year;       
o    the second,  third and fourth  quarters  consist of the subsequent  12-week
     periods,  except years  containing  53 weeks,  which have a 13-week  fourth
quarter.                                                              

Fiscal 2000 and fiscal 1999  contained  52 weeks and ended on December  31, 2000
and on January 2, 2000,  respectively.  Fiscal 1998 contained 53 weeks and ended
on January 3, 1999.                                                             

We have presented certain sales area data in the tables in this annual report in
terms of square feet.  Square feet may be converted to square  meters,  "m2", by
multiplying  the  number  of  square  feet by 0.093  and  square  meters  may be
converted to square feet by multiplying the number of square meters by 10.75.   

Unless otherwise indicated, references to currencies of countries other than The
Netherlands or the United States are as follows:                                

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                                                                [Download Table]

Country                            Currency                     Symbol
-------                            ---------                    ------
                                                                      
Brazil                             Brazilian Reals              BRL   
Thailand                           Thai Baht                    THB   
Czech Republic                     Czech Crowns                 CZK   
Sweden                             Swedish Krona                SEK   
Norway                             Norwegian Krone              NOK   
Portugal                           Portuguese Escudos           PTE   
Denmark                            Danish Krone                 DKK   


Forward-Looking Statements                                                      
Certain  statements   contained  in  this  annual  report  are  "forward-looking
statements"  within the meaning of U.S. federal  securities laws. We intend that
these  statements be covered by the safe harbors created under these laws. Those
statements include, but are not limited to:                                     

o    statements as to expected increases in net sales, operating results, market
     shares and certain expenses,  including  interest  expenses,  in respect of
certain of our operations;                                            
o    expectations  as to the impact of innovative  improvements  on productivity
levels, operating results and profitability in the stores;            
o    expectations  as to the savings  from new  projects  and  programs and from
     increased cooperation between our subsidiaries, in particular in the United
States;                                                               
o    estimates and financial  targets in respect of net earnings  growth and net
earnings per share;                                                   
o    expectations as to synergies to be realized from new  acquisitions  and the
impact on our operating results;                                      
o    statements as to the anticipated rate of growth of markets in which we have
operations;                                                           
o    expectations with respect to opportunities for expansion and growth;       
o    expectations  regarding  whether  conditions  of closing new  partnerships,
     business  ventures  and  acquisitions  of  businesses  or  stores  will  be
     satisfied,  and whether those  transactions will be consummated on schedule
or at all;                                                            
o    statements as to the funding of future expenditures and investments;       
o    estimates of euro conversion costs and impact of non-compliance;           
o    expectations of risks and liabilities of hedging transactions entered into;
o    statements as to the expected outcome of certain legal proceedings; and    
o    estimates of future growth in the number of employees.                     

These forward-looking  statements are subject to risks,  uncertainties and other
factors that could cause actual results to differ materially from future results
expressed or implied by the forward-looking  statements.  Important factors that
could cause actual results to differ  materially  from the information set forth
in any forward-looking statements include:                                      

o    the effect of general economic  conditions and changes in interest rates in
the countries in which we operate;                                    
o    difficulties  encountered  in converting to euros and  unanticipated  costs
during the transition;                                                
o    increases  in  competition  in the  markets in which our  subsidiaries  and
     partnerships   operate  and  changes  in  marketing   methods  utilized  by
competitors;                                                          
o    difficulties  encountered  in  the  integration  of  new  acquisitions  and
     partnerships and unanticipated costs,  diversion of management's  attention
and loss of personnel that could result;                              
o    fluctuations in exchange rates between the euro and the other currencies in
     which our assets,  liabilities and operating  results are  denominated,  in
particular, the dollar; and                                           
o    unusual  items and changes in Dutch GAAP  accounting  treatment of goodwill
amortization;                                                         

as well as the other factors discussed elsewhere in this annual report.         

Many of these factors are beyond our ability to control or predict.  Given these
uncertainties,  readers  are  cautioned  not  to  place  undue  reliance  on the
forward-looking statements.                                                     

Neither our independent auditors,  nor any other independent  accountants,  have
compiled, examined, or performed any procedures, with respect to the prospective
financial  information  contained herein, nor have they expressed any opinion or
any other form of assurance on such information or its achievability, and assume
no  responsibility  for, and  disclaim any  association  with,  the  prospective
financial information.                                                          

Our Address                                                                     

Company Address                 Mailing Address                                 
Royal Ahold                     P.O. Box 3050                                   
Albert Heijnweg 1               1500 HB Zaandam                                 
Zaandam, The Netherlands        The Netherlands                                 

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PART I                                                                          
ITEM 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISORS                   

Not Applicable                                                                  

ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE                                 

Not Applicable                                                                  

ITEM 3. KEY INFORMATION                                                         

The  selected  consolidated  financial  data set forth  below  should be read in
conjunction  with the  consolidated  financial  statements  contained in Item 18
"Financial Statements" of this annual report.                                   

Reference is made to note 23 to the consolidated financial statements,  included
elsewhere in this annual report,  for a discussion of the principal  differences
between U.S. GAAP and Dutch GAAP. For  information  about material  acquisitions
and  consolidations  affecting the periods presented below,  please see Item 4 -
"Information  on the Company" and Item 5 - "Operating  and Financial  Review and
Prospects - Acquisitions and Consolidations".  For information on the changes in
share  capital,  please see Item 9 -"The Offer and  Listing"  and note 15 of the
consolidated financial statements, included elsewhere in this annual report.    

Our fiscal year generally consists of 52 weeks and ends on the Sunday nearest to
December  31.  Fiscal years 1996 and 1997 each  contained 52 weeks,  fiscal 1998
contained 53 weeks and fiscal 1999 and fiscal 2000 each contained 52 weeks.     

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                                                        [Enlarge/Download Table]

Consolidated Earnings Data                                                                                             
                                                                                         Fiscal Year                   
                                                                           2000      1999      1998      1997      1996
                                                                         (in EUR millions, except per share amounts)   
                                                                                                                       
Amounts in accordance with Dutch GAAP                                                                                  
Net sales                                                                52,471    33,560    26,484    22,947    16,580
Net income from operations                                                1,116       752       547       424       287
Net income from operations per common share                                1.51      1.14      0.91      0.76      0.61
Diluted net earnings per common share                                      1.47      1.11      0.90      0.75      0.60

Approximate amounts in accordance with U.S. GAAP                                                                       
Net sales                                                                52,471    33,560    26,484    22,947    16,580
Net income from operations                                                  811       586       398       323       235
Net income from operations per common share                                1.09      0.88      0.65      0.58      0.50
Diluted net earnings per common share                                     1.07      0.87      0.65      0.57      0.49 

Consolidated Balance Sheet Data                                                                                        
                                                                        Dec. 31    Jan. 2    Jan. 3   Dec. 28   Dec. 29
                                                                           2000      2000      1999      1997      1996
                                                                         (in EUR millions, except per share amounts)   
Amounts in accordance with Dutch GAAP                                                                                  
Total assets                                                             25,461    14,286    11,426     8,549     6,748
Shareholders' equity (1)                                                  2,503     2,352     1,724     1,525     1,190
Capital Stock                                                               269       179       175       146       118
Common shares outstanding                                               816,849   653,919   646,657   547,323   538,579
Cumulative preferred financing shares outstanding                       259,317   144,000   144,000   120,000   120,000

Approximate amounts in accordance with U.S. GAAP                                                                       

Total assets                                                             37,393    20,894    16,919    11,575     9,332
Shareholders' equity                                                     13,571     8,106     6,652     4,353     3,682

--------------                                                                                                         
(1) Effective  fiscal 2000,  the proposed  dividend  payable on common shares is                                       
included  in  shareholders'   equity  and  not  in  other  current  liabilities.                                       
Shareholders' equity and current liabilities are restated for fiscal 1999, 1998,                                       
1997 and 1996.  Shareholders'  equity under the old methodology would have been,                                       
in  millions,  EUR 2,135 in fiscal  2000 and was EUR 2,126 in fiscal  1999,  EUR                                       
1,553 in fiscal 1998, EUR 1,402 in fiscal 1997 and EUR 1,097 in fiscal 1996.                                           

Dividends                                                                       

We customarily  declare  dividends twice a year. An interim dividend is proposed
by our  Corporate  Executive  Board and,  with the  approval of our  Supervisory
Board,  is generally  paid in  September.  The proposed  total  dividend must be
approved by the Annual General Meeting of Shareholders,  which is typically held
in May, and the final  portion of the total  yearly  dividend is paid after this
meeting.  Historically,  shareholders have had the option to elect either a cash
dividend or a stock dividend.  Prior to fiscal 1997, the cash dividend consisted
of a Dutch guilder component and a dollar  component.  Effective fiscal 1997, we
discontinued  cash dividend  declarations  in two  currencies and cash dividends
were declared only in Dutch  guilders.  We declared our dividend for fiscal 1998
in Dutch guilders. Effective fiscal 1999, dividends were declared in euros.     

The following table gives certain information  relating to dividends declared in
the years  indicated.  The  dividend  for fiscal  2000 has been  proposed by the
Corporate Executive Board, but must be approved by the Annual General Meeting of
Shareholders  to be held on May 15, 2001.  The final portion of the total yearly
dividend  will be paid after this meeting.  For purposes of this table,  we have
converted dividend amounts that have been paid in Dutch guilders in fiscal 1998,
1997 and 1996 to euros using the fixed rate of EUR 1 = NLG 2.20371.             

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                                                        [Enlarge/Download Table]

                                                        Total Translated Cash                                     
Fiscal Year                     Cash Dividend Option      Dividend Option (1)             Stock Dividend Option   

                                                                                                                  

                               EUR             $        EUR             $                                         
1996         Interim           0.04     and    0.04     0.07     or     0.09        1 common share per 100 owned  
             Final             0.10     and    0.10     0.18     or     0.21        2 common shares per 100 owned 
                               ----            ----     ----            ----                                      
             Total             0.14     and    0.14     0.25            0.30                                      

1997         Interim           0.09                                     0.10        1 common share per 100 owned  
             Final             0.23                                     0.26        2 common shares per 100 owned 
                               ----                                     ----                                      
             Total             0.32                                     0.36                                      

1998         Interim           0.12                                     0.14        1 common share per 100 owned  
             Final             0.26                                     0.32        2 common shares per 100 owned 
                               ----                                     ----                                      
             Total             0.38                                     0.46                                      

1999         Interim           0.14                                     0.15        1 common share per 100 owned  
             Final             0.35                                     0.35        2 common shares per 100 owned 
                               ----                                     ----                                      
             Total             0.49                                     0.50                                      

2000         Interim           0.18                                     0.16        1 common share per 100 owned  
             Final(proposed)   0.45                                      --         2 common shares per 100 owned 
                               ----                                      --                                       

             Total             0.63                                      --                                       

-------------------                                                                                               
(1)  For fiscal 1999 and 2000,  the translated  total dollar  dividend  amount  consists of the euro cash dividend
     translated into dollars at the noon buying rate on the applicable  dividend payment date. For fiscal 1997 and
     1998, the translated euro dividend  amount consists of the Dutch guilder cash dividend  translated into euros
     at the fixed exchange rate. For fiscal 1997 and 1998, the translated  dollar  dividend amount consists of the
     Dutch guilder  dividend  translated into dollars at the noon buying rate on the applicable  dividend  payment
     date. For fiscal 1996, the translated euro dividend consists of the dollar cash dividend component translated
     into Dutch  guilders at the noon buying rate on the  applicable  dividend  payment  date,  added to the Dutch
     guilder cash dividend  component,  and then  translated  into euros at the fixed rate.  This  information  is
     included only for the reader's convenience.                                                                  

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Exchange Rates                                                                  

Prior to fiscal 1999, we utilized the Dutch  guilder as our reporting  currency,
however,  beginning  in  fiscal  1999,  we  adopted  the  euro as our  reporting
currency. As part of the introduction of the euro throughout the European Union,
the  exchange  rate  between  the  legacy  currencies  and the euro was fixed on
January  1,  1999.  Accordingly,   we  have  converted  the  historic  financial
statements and related disclosures that were reported using the Dutch guilder to
the euro  using the fixed rate of EUR 1 = NLG  2.20371.  The  conversion  of our
historical  financial  statements  from Dutch guilders to euro at the fixed rate
depicts  the same  trends  that  would  have  been  presented  if we would  have
continued to present our financial statements in Dutch guilders.                

The  following  table  sets  forth,  for our  fiscal  years  indicated,  certain
information  concerning  the exchange  rate of the dollar  relative to the euro,
expressed in dollar per euro, at the noon buying rate:                          

                                                                [Download Table]

                    Period End   Average (1)    High        Low                 
                                                                                
1996..............     1.2617      1.3050      1.2550     1.3708                
1997..............     1.1019      1.1252      1.0406     1.2739                
1998..............     1.1741      1.1116      1.0572     1.1791                
1999..............     1.0070      1.0588      1.0016     1.1812                
2000..............     0.9388      0.9207      1.0335     0.8270                

-------------------                                                             
(1)  The average of the noon buying  rates on the last day of each month  during
     the relevant period.                                                       

The  following  table sets forth,  for the  six-month  period of October 1, 2000
through March 30, 2001, the high and low noon buying rates of the dollar against
the euro. The noon buying rate of the dollar as of March 30, 2001 was $ 0.8794 =
EUR 1.                                                                          

                                                                [Download Table]

                                                High     Low 
                                                             

October 2000.............................      0.8806  0.8270
November 2000............................      0.8694  0.8382
December  2000...........................      0.9388  0.8765
January 2001.............................      0.9535  0.9181
February 2001............................      0.9395  0.9057
March 2001...............................      0.9340  0.8794

Fluctuations in the exchange rate between the dollar and the euro, or the dollar
and the Dutch  guilder for the periods  prior to January 1, 1999,  have affected
the dollar  equivalent  of the euro prices of the common  shares on the Official
Segment of Euronext Amsterdam N.V.'s stock market,  also referred to as Euronext
Amsterdam,  or Euronext  (formerly known as the AEX-Stock  Exchange or Amsterdam
Exchanges) and, as a result, are likely to have affected the market price of the
ADSs on the NYSE. Such fluctuations will also affect the dollar amounts received
by holders of ADSs on conversion by the  Depositary  of cash  dividends  paid in
euro on the common shares represented by the ADSs.                              

Risk Factors Affecting Financial Condition and Operating results                

Exchange Rates                                                                  
We adopted  the euro as our  reporting  currency in our  consolidated  financial
statements  effective  at the  beginning  of  fiscal  1999.  See  "Item 5 - Euro
Conversion".  Because a  substantial  portion  of our  assets,  liabilities  and
operating results are denominated in dollars,  we are exposed to fluctuations in
the value of the dollar against the euro. We do not hedge this foreign  currency
translation exposure.                                                           

Our financial and risk management  policy is to match the currency  distribution
of our borrowings to the denomination of our assets.  As a result,  fluctuations
in our  balance  sheet  ratios  resulting  from  changes in  exchange  rates are
generally  limited.  The  effect of other  currency  changes  on our  results is
limited  due to the smaller  size of our net  earnings,  assets and  liabilities
denominated in other foreign currencies.                                        

Euro Conversion                                                                 
The  introduction  of the euro will have a  significant  effect on our  European
operations and financial systems.  From January 1, 1999 until December 31, 2001,
certain EU member  countries will have had two  currencies for electronic  funds
transfers,  the euro and its local currency.  We have already begun our transfer
to euro denominated billing in our business-to-business transactions. Euro notes
and coins will  officially  enter  circulation on January 1, 2002 and certain EU
member  country will have to remove its national  currency from  circulation  by
June 30, 2002. The relevant EU countries are expected to shorten this transition
period to a maximum of two months. In The Netherlands, a dual currency period of
four weeks has been  agreed  upon.  The actual  costs of this  conversion  could
differ materially from those anticipated.                                       

Foreign Investment Risks                                                        
We have operations and other investments in a number of countries outside of the
United States and Europe.  Foreign operations and investments are subject to the
risks normally associated with conducting business in foreign countries such as:

o    labor disputes;                                                            
o    uncertain political and economic environments;                             
o    risks of war and civil disturbances;                                       
o    risks associated with the movement of funds;                               
o    deprivation of contract rights;                                            
o    taking  of  property  by  nationalization  or  expropriation  without  fair
compensation;                                                         
o    risks relating to changes in laws or policies of particular  countries such
as foreign taxation;                                                  
o    risks associated with obtaining necessary governmental permits, limitations
on ownership and on repatriation of earnings; and                     
o    foreign exchange and currency fluctuations.                                

We cannot assure you that these problems or other  problems  relating to foreign
operations will not be encountered by us in the future.  Foreign  operations and
investments  may also be  adversely  affected by laws and policies of the United
States,  Europe and the other  countries in which we operate  governing  foreign
trade, investment and taxation.                                                 

Inflation and Changing Prices                                                   
Inflation continues to cause moderate increases in our costs, including the cost
of merchandise,  labor,  utilities and acquiring property,  plant and equipment.
Cost inflation in our primary  markets,  the United States and The  Netherlands,
however,  has been relatively low in each of the last three years. In the United
States,  the inflation  rate for food prices has been roughly  equivalent to the
general  increase in consumer prices,  while in The  Netherlands,  the inflation
rate for food prices has remained below general price increases.  Although there
is the risk that inflation in Asia Pacific,  other European  countries and Latin
America could have an effect on our results, we do not believe inflation has had
a material  effect on net sales or operating  results in these  regions to date,
primarily because we have been able to pass along merchandise price increases to
our customers.                                                                  

ITEM 4. INFORMATION ON THE COMPANY                                              

Overview                                                                        

We are the largest food provider in The Netherlands  based on 2000 net sales and
one of the largest food  providers in the United States based on 2000 net sales.
During fiscal 2000, we provided food primarily  through retail trade outlets and
made substantial  investments in complementary food service  activities.  We are
also one of the  largest,  and  among  the most  internationally  diverse,  food
providing groups world-wide. As of fiscal year end 2000, we operated or serviced
8,600 stores,  including  nearly 4,000  franchise  and  associated  stores,  and
employed  approximately 377,000 people. The store format we primarily use is the
supermarket.  However we also operate or service hypermarkets,  discount stores,
specialty stores,  cash-and-carry  stores and convenience  stores. The following
table sets out,  as of the dates  indicated,  our store  count and sales area by
geographic region:                                                              

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                                                        [Enlarge/Download Table]

                                       Store Count and Sales Area by Geographic Region                                      

                                                                                     As of Fiscal Year End                  
                                                                        2000                1999                1998        
                                                                  Store   Sales Area  Store  Sales Area   Store  Sales Area 
                                                                  Count   (sq. ft.    Count   (sq. ft.    Count  (sq. ft.   
                                                                             000)               000)                000)    
                                                                                                                            
United States (including franchise stores)                        1,313     33,482    1,063     31,495    1,031    30,175   
Europe (including franchise and associated stores) (1) (2)        6,623     45,076    2,958     19,659    2,696    16,904   
Latin America                                                       567      9,256      530      8,396      292     5,964   
Asia Pacific                                                         97      1,841       89      1,872      147     1,715   
                                                                  -----     ------    -----     ------    -----    ------   
Total                                                             8,600     89,655    4,640     61,422    4,166    54,758   
                                                                  =====     ======    =====     ======    =====    ======   
---------------                                                                                                             
(1)  Excludes for fiscal 2000 the sales area of the associated stores in Norway.                                            
(2)  Starting fiscal 2000, the stores  associated with our subsidiaries  have been included,  for fiscal years 1999 and 1998
     figures have been adjusted accordingly.                                                                                

Our operations are located primarily in the United States and Europe.  Net sales
in the United States accounted for 58% of fiscal 2000 net sales, while net sales
in Europe  accounted  for 31% of total net  sales in fiscal  2000.  We also have
operations  in Latin  America,  which  accounted  for 10% of net sales in fiscal
2000, and in several  countries in the Asia Pacific region,  which accounted for
1% of net sales in 2000. Our principal business is retail trade, which accounted
for 85% of total  net sales in  fiscal  2000.  Retail  trade  includes  sales to
consumers  at our own stores as well as sales to our  franchise  and  associated
stores.  Our food service  activities  accounted for 15% of net sales for fiscal
year 2000.                                                                      

We  have  substantially  expanded  our  business  through  acquisitions  and new
partnerships in fiscal years 2000, 1999 and 1998. Over this period, we completed
14  significant  business  acquisitions,   for  an  aggregate  consideration  of
approximately  EUR 14.9 billion,  including assumed  indebtedness.  We have also
made five business divestitures, for an aggregate consideration of approximately
EUR 46.4 million.                                                               

The  following  tables set out,  for the  periods  indicated,  our net sales and
operating results by business segment and geographic region:                    

                                                        [Enlarge/Download Table]


                                     Net Sales by Business Segment/Geographic Region                                    

                                                                                        Fiscal Year                     
                                                                             2000               1999          1998      
                                                                         ($)    (EUR)  (%)    (EUR)   (%)   (EUR)   (%) 
                                                                             (in millions, except percentages)          
                                                                                                                        
Retail trade:                                                                                                           
   United States (including sales to franchise stores) (1)            21,796   23,703   45   19,126    57  14,503    55 
   Europe (including sales to franchise and associated stores)        14,576   15,466   29    9,867    30   9,051    34 
   Latin America                                                       4,789    5,082   10    3,497    10   2,116     8 
   Asia Pacific                                                          378      402    1      476     1     410     2 
                                                                      ------   ------  ---   ------   ---  ------   --- 
Total retail trade                                                    41,539   44,653   85   32,966    98  26,080    99 
Food service:                                                                                                           
    United States (1)                                                  5,952    6,649   13       --    --      --    -- 
    Europe                                                             1,041    1,105    2      553     2     365     1 
                                                                      ------    -----  ---      ---   ---  ------   --- 
Total food service                                                     6,993    7,754   15      553     2     365     1 
Other activities                                                          60       64   --       41    --      39    -- 
                                                                      ------   ------  ---   ------   ---  ------   --- 
Total                                                                 48,592   52,471  100   33,560   100  26,484   100 
                                                                      ======   ======  ===   ======   ===  ======   === 
--------------                                                                                                          
(1)  The dollar amount for fiscal 2000 represents the actual amount before conversion into euros and was $20,333 million
     in fiscal  1999 and  $16,174  million  in fiscal  1998 for the retail  trade.  As a  consequence  the USD amount as
     displayed does not arise from the translation  method described in the section "General  Information" of the annual
     report.                                                                                                            

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                                                                [Download Table]

                      Operating Results by Business Segment                 

                                            Fiscal Year                     
                                2000               1999           1998      
                           ($)    (EUR)  (%)     (EUR)  (%)    (EUR)   (%)  
                                (in millions, except percentages)           
                                                                            
Retail trade              1,738   1,845    81    1,364    96     925     91 
Food service                278     294    13       15     1       8      1 
Real estate and other       127     135     6       36     3      84      8 
                          -----   -----   ---    -----   ---   -----    --- 
Total                     2,143   2,274   100    1,415   100   1,017    100 
                          =====   =====   ===    =====   ===   =====    === 

                                                                [Download Table]

                     Operating Results by Geographic Region                     

                                                 Fiscal Year                    
                                     2000               1999           1998     
                                ($)    (EUR)  (%)     (EUR)  (%)    (EUR)   (%) 
                                     (in millions, except percentages)          
                                                                                

United States (1)             1,342   1,466    65      944    67     639     63 
Europe                          631     670    29      459    32     406     40 
Latin America                   192     204     9       97     7      63      6 
Asia Pacific                    (19)    (20)   (1)     (41)   (3)    (47)    (5)
Unallocated corporate costs     (43)    (46)   (2)     (44)   (3)    (44)    (4)
                              -----   -----   ---    -----   ---   -----    --- 
Total                         2,103   2,274   100    1,415   100   1,017    100 
                              =====   =====   ===    =====   ===   =====    === 
---------------                                                                 
(1)  The dollar  amount for fiscal  2000  represents  the actual  amount  before
     translation  into  euros and was  $1,001  million  in fiscal  1999 and $714
     million in fiscal 1998. As a consequence  the USD amount as displayed  does
     not arise from the  translation  method  described in the section  "General
     Information" of the annual report.                                         

The  following  table  shows  average  capital  employed by  geographic  region.
"Capital  employed" is defined as fixed assets,  including  capitalized  leases,
plus goodwill, at initial cost at date of acquisition, and net working capital. 

                                                                [Download Table]

        Average Capital Employed including goodwill by Geographic Region        

                               Average Capital Employed for Fiscal Year         
                                  2000           1999           1998            
                                       (EUR in millions)                        
                                                                                

United States (1)                13,039          8,232          5,629           
Europe                            4,769          2,496          2,112           
Latin America                     3,456          2,310          1,469           
Asia Pacific                        268            275            193           
                                 ------         ------          -----           
Total                            21,532         13,313          9,403           
                                 ======         ======          =====           

----------------                                                                
(1)  Dollar  amounts  prior to  conversion  into euros were  $12,136  million in
     fiscal  2000,  $8,741  million in fiscal 1999 and $6,315  million in fiscal
     1998.                                                                      

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The  following  table  shows  average  capital  employed  excluding  goodwill by
geographic  region.  "Capital  employed" is defined as fixed  assets,  including
capitalized leases, and net working capital.                                    

                                                                [Download Table]

        Average Capital Employed excluding goodwill by Geographic Region        

                                Average Capital Employed for Fiscal Year        
                                   2000           1999           1998           
                                        (EUR in millions)                       
                                                                                

United States (1)                  6,633          4,173          3,190          
Europe                             3,081          1,915          1,754          
Latin America                      1,621          1,143            629          
Asia Pacific                          74             78             81          
                                  ------          -----          -----          
Total                             11,409          7,309          5,654          
                                  ------          -----          -----          
---------------                                                                 
(1)  Dollar amounts prior to conversion into euros were $6,177 million in fiscal
     2000, $4,425 million in fiscal 1999 and $3,570 million in fiscal 1998.     

History                                                                         

Royal Ahold was founded in 1887.  In 1948,  we, named Albert Heijn N.V.,  listed
our shares on the what is today Euronext. In 1973, our name was changed to Ahold
N.V.,  indicative  of our  development  as a holding  company with  interests in
retail trade and related  areas.  On our one hundredth  anniversary in 1987, the
Queen of The Netherlands granted us the title "Koninklijke" (Dutch for "Royal"),
and we changed our full name of Ahold N.V. to Koninklijke Ahold N.V.            

In order to further  develop our  strategy  of  sustained  growth,  we began our
international  expansion in 1977.  Major  acquisitions in the United States have
consisted of:                                                                   

o    BI-LO in 1977;                                                             
o    Giant-Carlisle in 1981;                                                    
o    First National (Finast) in 1988;                                           
o    Tops in 1991;                                                              
o    Red Food Stores in 1994;                                                   
o    Mayfair in 1995;                                                           
o    Stop & Shop in 1996;                                                       
o    Giant-Landover in 1998;                                                    
o    U.S. Foodservice in 2000;                                                  
o    Peapod in 2000; and                                                        
o    PYA/Monarch in 2000.                                                       

Notable acquisitions and partnerships formed in other regions include:          

o    JMR in Portugal in 1992;                                                   
o    Bompreco in Brazil in 1996;                                                
o    Supermar in Brazil in 1997;                                                
o    Disco and Santa Isabel in Argentina and Chile in 1998;                     
o    Dialco, Dumaya, Guerrero and Castillo del Barrio in Spain in 1999;         
o    Gastronoom in The Netherlands in 1999;                                     
o    Supamer and Gonzales in Argentina in 1999;                                 
o    La Fragua in Guatemala in 1999;                                            
o    ICA Group in Scandinavia in 2000;                                          
o    Kampio in Spain in 2000;                                                   
o    Ekono in Argentina in 2000;                                                
o    A&P in The Netherlands through our 73% owned subsidiary  Schuitema in 2000;
and                                                                   
o    Superdiplo in Spain in 2000.                                               

Corporate and Organizational Structure                                          

We are  incorporated  under the laws of The  Netherlands  as a  holding  company
conducting  business  through our  subsidiaries  and  partnerships.  In the USA,
operational  management is divided into a "retail" division and a "food service"
division.  Within the retail  trade  division,  we manage our  businesses  along
geographical lines. In the United States,  Ahold U.S.A., Inc. ("Ahold USA"), the
U.S.  holding  company,   coordinates  the  activities  of  the  U.S.  operating
companies.   In  The  Netherlands,   operational   management  is  divided  into
supermarkets,  specialty  retailing,  food service,  food  production  and other
operations.  Retail  operations  outside The  Netherlands  primarily  consist of
supermarkets.  In other European countries and Latin America and Asia, we manage
our businesses along geographical lines.                                        

Management of each  individual  chain is responsible  for  merchandising,  store
formats and marketing  strategies.  Decisions  regarding the strategic direction
and overall  management  of group  companies  are taken at the  holding  company
level.                                                                          

Below is the organizational  structure of our principal consolidated  activities
as of the end of fiscal 2000:                                                   

                                                        [Enlarge/Download Table]

                                                                                                                         

                                                -----------------------                                                  
                                                | Corporate Executive |                                                  
                                                |         Board       |                                                  
                                                -----------------------                                                  
                                                           |                                                             
                   ----------------------                  |             ----------------------                          
                   |  Corporate Staff   |------------------|-------------|       Other        |                          
                   |                    |                  |             |    Activities      |                          
                   ----------------------                  |             ----------------------                          
                                                           |                                                             
                                                           |                                                             
-------------------------------------------------------------------------------------------------------------------------
|         Retail       |   |                                                               |                            |
------------------------   |                                                               |                            |
|                          |                                                               |                            |
|   --------------------   |    -----------------------        ------------------------    | -----------------------    |
|---|  Stop & Shop     |   |----|   Albert Heijn      |        |     Bompreco         |----| | Ahold Kuok Malaysia |----|
|   |                  |   |    |  (The Netherlands)  |        |     (Brazil)         |    | |     (Malaysia)      |    |
|   --------------------   |    -----------------------        ------------------------    | -----------------------    |
|                          |                                                               |                            |
|   --------------------   |    -----------------------        ------------------------    | -----------------------    |
|   | Giant-Carlisle   |   |----|     Schuitema       |        |         Disco        |----| |      CRC Ahold      |----|
|---|                  |   |    | (The Netherlands)   |        |     (Argentina)      |    | |     (Thailand)      |    |
|   --------------------   |    -----------------------        ------------------------    | -----------------------    |
|                          |                                                               |                            |
|   --------------------   |    -----------------------        ------------------------    | -----------------------    |
|---|      BI-LO       |   |----|  Specialty Stores   |        |    Santa Isabel      |----| |     PSP Group       |----|
|   |                  |   |    | (The Netherlands)   |        |       (Chile)        |    | |    (Indonesia)      |    |
|   --------------------   |    -----------------------        ------------------------    | -----------------------     
|                          |                                                               |                             
|   --------------------   |    -----------------------        ------------------------    |                             
|---|      Tops        |   |----|  Food Production    |        |      La Fragua       |----|                             
|   |                  |   |    | (The Netherlands)   |        |     (Guatemala)      |                                  
|   --------------------   |    -----------------------        ------------------------                                  
|                          |                                                                                             
|   --------------------   |    -----------------------                                                                  
|---| Giant-Landover   |   |----|      Deli XL        |                                                                  
|   |                  |   |    |  (The Netherlands)  |                                                                  
|   --------------------   |    -----------------------                                                                  
|                          |                                                                                             
|   --------------------   |    -----------------------                                                                  
|---|  Peapod, Inc.    |   |----|    Real Estate      |                                                                  
|   |                  |   |    | (The Netherlands)   |                                                                  
|   --------------------   |    -----------------------                                                                  
|                          |                                                                                             
|   --------------------   |    -----------------------                                                                  
|   |   Real Estate    |   |----|     ICA Group       |                                                                  
|---|                  |   |    |   (Scandinavia)     |                                                                  
|   --------------------   |    -----------------------                                                                  
|                          |                                                                                             
|-----------------------   |    -----------------------                                                                  
|     Food Service     |   |    |  Jeronimo Martins   |                                                                  
|-----------------------   |----|       Retail        |                                                                  
|                          |    |     (Portugal)      |                                                                  
|                          |    -----------------------                                                                  
|   --------------------   |                                                                                             
|---| U.S. Foodservice |   |                                                                                             
    --------------------   |    ------------------------                                                                 
     |                     |    | Ahold Czech Republic |                                                                 
     |                     |----|  (Czech Republic)    |                                                                 
     |                     |    ------------------------                                                                 
     |   ---------------   |                                                                                             
     |---| PYA/Monarch |   |                                                                                             
         ---------------   |    -----------------------                                                                  
                           |----|   Ahold Polska      |                                                                  
                           |    |     (Poland)        |                                                                  
                           |    -----------------------                                                                  
                           |                                                                                             
                           |    -----------------------                                                                  
                           |----| Ahold SuperMercados |                                                                  
                                |       (Spain)       |                                                                  
                                -----------------------                                                                  

------------------------       ------------------------       --------------------------     ---------------------       
|                      |       |                      |       |                        |     |                   |       
|    UNITED STATES     |       |        EUROPE        |       |      LATIN AMERICA     |     |    ASIA PACIFIC   |       
|                      |       |                      |       |                        |     |                   |       
------------------------       ------------------------       --------------------------     ---------------------       

For a  detailed  list of  significant  subsidiaries,  proportions  of  ownership                                         
interest  and,  if  different,  proportion  of  voting  power,  see  Item  19  -                                         
"Exhibits".                                                                                                              

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Retail Trade - Overview                                                         

We are an  internationally  diverse food provider with  operations in the United
States,  Europe, Latin America and Asia Pacific. Our retail business consists of
our retail  chain  sales,  sales to  franchise  stores  and sales to  associated
stores.  The following table sets out, for the periods  indicated,  retail trade
net sales by geographic region:                                                 

                                                        [Enlarge/Download Table]

                   Retail Trade Net Sales by Geographic Region                                          

                                                                             Fiscal Year                
                                                                   2000          1999          1998     
                                                                 (EUR)   (%)   (EUR)   (%)    (EUR)  (%)
                                                                  (in millions, except percentages)     
                                                                                                        
United States (including sales to franchise stores)             23,703    53  19,126    58   14,503   56
Europe (including sales to franchise and associated stores)     15,466    35   9,867    30    9,051   35
Latin America                                                    5,082    11   3,497    11    2,116    8
Asia Pacific                                                       402     1     476     1      410    1
                                                                ------   ---  ------   ---   ------  ---
Total Retail Trade                                              44,653   100  32,966   100   26,080  100
                                                                ======   ===  ======   ===   ======  ===

As of the end of fiscal 2000, we operated or serviced  8,600  stores,  including
1,245 franchise stores and 2,733 associated  stores.  Over 7,000 of these stores
are  supermarkets.  In some local markets,  we have expanded into other formats,
including  specialty  retailing,  hypermarkets,  cash and carry and  convenience
stores.  The majority of our  franchise  stores are located in The  Netherlands,
while associated stores are found in Scandinavia and in The Netherlands.  (For a
detailed  description  of our franchise and  associated  stores,  please see the
section  "Retail Trade - Europe" of this Item 4). The following  table sets out,
as of the end of fiscal 2000,  store count by company stores,  franchise  stores
and associated stores:                                                          

                                                        [Enlarge/Download Table]

                                       Company, Franchise and Associated Stores                                       

                                                          As of Fiscal Year End 2000                                  

                                Company       Franchise       Associated     Company   Franchise   Associated   Total 
                           Supermarkets(1)  Supermarkets(1)  Supermarkets(1)  Other(2)   Other(2)    Other(2)         
                                                                                                                      
United States (3)                 956              7              --            341         9         --        1,313 
Europe                          1,966            743           2,703            695       486         30        6,623 
Latin America                     531             --              --             36        --         --          567 
Asia Pacific                       97             --              --             --        --         --           97 
                                   --             --              --             --        --         --           -- 
Total                           3,550            750           2,703          1,072       495         30        8,600 
                                =====            ===           =====          =====       ===         ==        ===== 

-------------------                                                                                                   

(1)  Includes grocery stores and food retail stores considered supermarkets under local market conditions.            
(2)  Includes certain specialty retail stores in The Netherlands,  hypermarkets,  mostly in Portugal,  Scandinavia and
     Brazil, minimarkets in Brazil, and convenience stores in the United States.                                      
(3)  In February 2001, certain of our U.S. subsidiaries sold 34 stores to unaffiliated purchasers. The purchasers then
     leased the properties to one of our wholly-owned  subsidiaries.  For a further  discussion of the leveraged lease
     transactions, please see Item 5 - "Operating and Financial Review and Prospects - Recent Developments".          

The following table gives an overview of changes in total store count, including
franchise stores and associated stores, for the periods indicated:              

                                                                [Download Table]

                       Changes in Consolidated Store Count                  

                                             Fiscal Year                    

                                                                            
                                    2000             1999              1998 
Beginning of period                4,640            4,166             3,635 
Opened/acquired                    4,184              681               745 
Disposed                            (224)            (207)             (214)
                                   -----            -----             ----- 
End of period                      8,600            4,640             4,166 
                                   =====            =====             ===== 

Retail Trade in the United States                                               
We have established  ourselves,  through  acquisitions and organic growth,  as a
leading  food  retailer  in the  United  States,  operating  in 17 states in the
eastern United States and  Washington,  D.C. Based on fiscal 2000 sales, we were
among the top five food retailers in the United States. While management of each
individual  chain  is  responsible  for its  merchandising,  store  formats  and
marketing  strategies,  the operations of the five regional operating  companies
are  coordinated as a group through Ahold U.S.A.  Each chain operates in its own
local marketing area.                                                           

The  table  that  follows  sets out,  for the  periods  indicated,  net sales in
millions of dollars,  store counts and sales area,  in thousands of square feet,
for Royal Ahold's retail trade  operations in the United  States.  Net sales for
fiscal  2000  include  Peapod  beginning  from the end of the second  quarter of
fiscal  2000.  Net  sales  for  fiscal  1998  include  Giant-Landover  from  its
acquisition date of October 28, 1998.                                           

                                                        [Enlarge/Download Table]

                                   U.S. Retail Trade Sales, Store Count and Sales Area                                  

                                                                As of and for the Fiscal Year Ended                     
                                                      2000                      1999                     1998           
                                                                       (sales in millions)                              
                                             $ Net     Store    Sales  $ Net      Store    Sales  $ Net    Store  Sales 
                                              Sales    Count    Area    Sales     Count    Area   Sales    Count  Area  
                                                                                                                        
Stop & Shop                                   7,748      274   11,023   6,672      202    8,184   6,187     193   7,735 
Giant-Carlisle                                2,993       96    3,285   3,432      156    5,157   3,417     149   4,971 
BI-LO                                         3,423      422    8,102   3,001      281    7,336   2,887     266   6,667 
Tops                                          2,807      342    5,493   2,716      248    5,290   2,846     250   5,390 
Giant-Landover                                4,780      179    5,579   4,512      176    5,528     837     173   5,412 
Peapod                                           45       --       --      --       --       --      --      --      -- 
                                             ------    -----   ------  ------    -----   ------  ------   -----  ------ 
Total United States (1)                      21,796    1,313   33,482  20,333    1,063   31,495  16,174   1,031  30,175 
                                             ======    =====   ======  ======    =====   ======  ====== = =====  ====== 

---------------                                                                                                         
(1)  In February 2001, certain of our U.S. subsidiaries sold 34 stores to unaffiliated  purchasers.  The purchasers then
     leased the properties to one of our  wholly-owned  subsidiaries.  For a further  discussion of the leveraged  lease
     transactions, please see Item 5 - "Operating and Financial Review and Prospects - Recent Developments".            

The following table gives, for the periods indicated,  changes in store count in
the United States:                                                              

                                                                [Download Table]

                   Changes in Store Count in the United States                  

                                         Fiscal Year                            
                             2000                 1999                1998      
                                                                                

Beginning of period         1,063                1,031                 830      
Acquired:                                                                       
    Sugar Creek                87                   --                  --      
    Golden Gallon             134                   --                  --      
   Giant-Landover              --                   --                 173      
Opened                         62                   67                  53      
Disposed                      (33)                 (35)                (25)     
                            -----                -----               -----      
End of period (1)           1,313                1,063               1,031      
                            =====                =====               =====      

---------------                                                                 
(1)  In  February  2001,  certain  of our U.S.  subsidiaries  sold 34  stores to
     unaffiliated  purchasers.  The purchasers then leased the properties to one
     of our wholly-owned subsidiaries. For a further discussion of the leveraged
     lease transactions, please see Item 5 - "Operating and Financial Review and
     Prospects - Recent Developments".                                          

Stop & Shop                                                                     
We acquired Stop & Shop in July 1996.  Stop & Shop,  which is  headquartered  in
Quincy, Massachusetts,  pioneered the superstore concept in New England in 1982.
In fiscal 2000,  most of the stores in the  "Edwards"  chain,  which  previously
formed a part of  Giant-Carlisle,  were converted to the Stop & Shop brand.  The
conversion  was  completed by the end of fiscal 2000.  Stop & Shop  operated 274
superstores and conventional  supermarkets (including the former Edwards stores)
at fiscal year end 2000, which are located in Massachusetts,  Connecticut, Rhode
Island, New Jersey and New York.                                                

Giant-Carlisle                                                                  
Based in Carlisle,  Pennsylvania,  Giant-Carlisle operated 96 supermarkets as of
the  end  of  fiscal  2000.  The  stores  operate  under  the  name  "Giant"  in
Pennsylvania  and under  the name  "Martin's"  in  Maryland,  Virginia  and West
Virginia. We acquired Giant-Carlisle in 1981.                                   

BI-LO                                                                           
We acquired BI-LO, based in Mauldin, South Carolina, in 1977. In May 2000, BI-LO
acquired  the  Golden  Gallon  convenience  stores in the  south-eastern  United
States.  As of the end of fiscal 2000,  BI-LO operated 288  supermarkets and 134
Golden Gallon convenience stores in South Carolina,  North Carolina,  Tennessee,
Alabama and Georgia.                                                            

Tops                                                                            
We  acquired  Tops in  March  1991.  In May  2000,  Tops  acquired  Sugar  Creek
convenience  and gas stores,  with 87 merchandise  and fuel stations in New York
State.  As of  the  end  of  fiscal  end  2000,  Tops  owned  and  operated  119
supermarkets  under the name "Tops  Friendly  Markets",  120  neighborhood  food
stores under the name "Wilson Farms" and 87 merchandise and fuel stations in New
York  State.  As of the end of fiscal  2000,  Tops  also had  seven  independent
supermarket  franchisees  operating  under the "Tops Friendly  Markets" name and
nine franchise  neighborhood food stores.  Tops' primary markets are Buffalo and
Rochester, both in the State of New York as well as markets in Cleveland, Ohio. 

Giant Food ("Giant-Landover")                                                   
In October 1998, we acquired Giant-Landover,  based in Landover, Maryland. As of
the end of fiscal  2000,  Giant-Landover  operated a chain of 179 retail  stores
selling food, health care items and general  merchandise in Maryland,  Virginia,
Delaware,  New Jersey and the District of Columbia.  In fiscal 2000, four stores
from  the  "Edwards"   chain  were  converted  to  the   Giant-Landover   brand.
Giant-Landover also operates four free-standing drugstores.                     

Peapod                                                                          
In June 2000,  we acquired a majority  stake in a leading U.S.  on-line  grocer,
Peapod,  based in Chicago,  Illinois.  For details  regarding  our  ownership in
Peapod,  please see Item 5 - "Operating  and  Financial  Review and  Prospects -
Acquisitions  and  Consolidations".  Peapod had net sales in fiscal  2000 of $93
million,  and was consolidated in our financial  statements beginning at the end
of the second quarter of fiscal 2000. In September 2000, Peapod acquired various
assets from  Streamline.com,  an on-line  shopping and delivery service based in
Massachusetts,  for approximately $12 million.  These assets included facilities
located in Chicago, Baltimore and Washington, D.C.                              

General                                                                         
All of our U.S.  supermarket chains,  with the exception of Giant-Carlisle,  are
serviced from their own distribution centers.  Giant-Carlisle  distributes meat,
produce and most other perishable items through its own distribution  center and
uses third-party wholesalers for the majority of its grocery items.             

One  common  feature  of each U.S.  subsidiary's  strategy  has been to focus on
maximizing consumer value,  optimizing store sizes and upgrading the quality and
the number of services  offered to  consumers.  Ahold  U.S.A.  has  undertaken a
number of projects to improve operational  efficiency by partially  centralizing
certain  common  functions  of its  subsidiaries  to take  advantage of possible
economies of scale. Ahold U.S.A. has three integrated companies,  American Sales
Company, Ahold Information Services and Ahold Financial Services,  which service
its  retail   operations.   American  Sales  Company  provides   purchasing  and
distribution services in health and beauty care items and general merchandise to
our U.S.  subsidiaries.  Ahold  Information  Services operates a data processing
center on behalf of all of our  retail  U.S.  subsidiaries,  facilitating  their
information systems operations.  Ahold Financial Services is expected to provide
all of our U.S. retail  subsidiaries'  accounting and financial  services at the
end of 2001.                                                                    

In November  2000,  Tops and  Giant-Carlisle  began  efforts to combine  certain
support services to create a Shared Services Structure.  This structure combines
support  functions in the areas of IT, real estate,  private label  development,
legal  affairs,  human  resources and  advertising & promotion  with the goal of
increasing  efficiency and generating cost savings.  The two operating companies
will continue to operate individually as separate and distinct businesses.      

Efficiency has been further improved by the establishment of a number of working
groups,  composed of  representatives  of each of our U.S.  subsidiaries,  whose
objective  is  to  identify  and  implement  operational  "best  practices"  and
potential  efficiency  improvements  across the various  subsidiaries.  Our U.S.
subsidiaries  have initiated  projects that include advanced product  purchasing
systems,  joint private label  purchasing  and a more unified  approach to store
construction.                                                                   

Retail Trade in Europe                                                          

We  have  significant  retailing  operations  in The  Netherlands,  Scandinavia,
Portugal,  the Czech Republic,  Poland and Spain.  The following table sets out,
for the periods  indicated,  net sales in millions  of euros,  store  counts and
sales area, in thousands of square feet, for our retailing operations in Europe:

                                                        [Enlarge/Download Table]

                                European Retail Trade Sales, Store Count and Sales Area                               

                                                              As of and for the Fiscal Year Ended                     
                                                    2000                      1999                      1998          
                                                                  (sales in millions of EUR)                          
                                             Net    Store   Sales      Net    Store     Sales   Net     Store   Sales 
                                            Sales   Count   Area      Sales   Count     Area   Sales    Count   Area  
                                                                                                                      
The Netherlands                                                                                                       
   Albert Heijn company stores               4,543    508    6,463    4,397     516    6,524   4,362      517   6,303 
   Albert Heijn franchise stores               768    201    1,757      730     238    1,694     710      232   1,588 
   Etos                                        315    480      997      291     460      790     258      395     769 
   Gall & Gall                                 211    486      449      215     488      436     218      485     434 
   Schuitema company stores (1)                165    128    1,550      --      --       --      --       --      --  
   Schuitema associated stores (1) (2)       1,971    423    3,263    1,831     453    3,172   1,726      464   3,046 
   Other                                        36    142      273       35     134      214      40      185     316 
Scandinavia (1)                                                                                                       
   Sweden associated/franchise stores        2,999  1,958   12,705      --      --       --      --       --      --  
   Norway company stores                       985    375    3,125      --      --       --      --       --      --  
   Norway associated/franchise stores (3)      440    767    1,773      --      --       --      --       --      --  
   Baltic States                                57     24      216      --      --       --      --       --      --  
Portugal (1)                                 1,467    210    2,731    1,341     196    2,492   1,202      174   2,182 
Czech Republic                                 598    190    2,514      455     173    1,899     326      149   1,393 
Poland                                         393    149    1,886      221     115    1,063     162       80     731 
Spain                                          518    582    5,374      351     185    1,375      47       15     142 
                                            ------  -----   ------    -----   -----   ------   -----    -----  ------ 
Total Europe                                15,466  6,623   45,076    9,867   2,958   19,659   9,051    2,696  16,904 
                                            ======  =====   ======    =====   =====   ======   =====    =====  ====== 

---------------                                                                                                       
(1)  These subsidiaries are not wholly-owned by us. For more information, see Item 19 - "Exhibits".                   
(2)  Starting fiscal 2000, these stores have been included. For fiscal years 1999 and 1998, figures have been adjusted
     accordingly.                                                                                                     
(3)  Sales area excludes associated stores.                                                                           

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The  following  table  gives,  for the periods  indicated,  the changes in store
count, including franchise stores, for Europe:                                  

Changes in Store Count in Europe

             Fiscal Year
                         2000                 1999                1998
                         -----                -----               ----
Beginning of period          2,958                2,696               2,625     
Opened/acquired              3,837                  379                 242     
Disposed/closed               (172)                (117)               (171)    
                        -----                -----               -----
End of period                6,623                2,958               2,696     
                        =====                =====               =====

The Netherlands                                                                 
We pioneered the  supermarket  concept in The  Netherlands and are currently the
leading  Dutch food  retailer  through our Albert Heijn brand,  both in terms of
sales volume and store count. As of the end of fiscal 2000, Albert Heijn had 709
stores, including 201 franchise stores, consisting of:                          

o    206 stores with sales areas of less than 8,600 sq. ft. (800 m2);           
o    439 stores with sales areas  between  8,600 sq. ft. (800 m2) and 18,275 sq.
ft. (1,700 m2); and                                                   
o    64 stores with sales areas over 18,275 sq. ft. (1,700 m2).                 

Albert  Heijn has achieved its position in The  Netherlands  by  implementing  a
retailing  strategy which offers customers a wide range of competitively  priced
products and high service levels in modern  stores.  Private label goods form an
important part of Albert Heijn's product selection and represented approximately
41% of its 2000 net sales.  Albert Heijn operates five distribution  centers for
grocery  products and a number of processing and other  distribution  facilities
for produce.                                                                    

In early 1998,  Albert Heijn introduced a customer  loyalty card program,  which
provides  insights into customer  profiles and buying  behavior,  while offering
discounts and buying incentives.  As of the end of fiscal 2000, the loyalty card
program had more than four million participants. We believe that these and other
innovative  improvements are leading to increased  productivity levels in Albert
Heijn stores.                                                                   

Albert Heijn  operates its home delivery  services  under the name "Albert Heijn
Thuisservice". The service allows customers to place orders through a variety of
electronic  media for home or other  delivery.  Over the years this  service has
been enhanced by improvements in our internet catalog,  in the area of logistics
and by linking the Albert Heijn Thuisservice with the loyalty card program.     

As of the end of fiscal 2000,  Albert Heijn also operated  through 201 franchise
stores.  These franchise stores typically  operate in smaller market areas under
the Albert Heijn formula and are not distinguishable from company-owned  stores.
For each franchise, Albert Heijn has agreed to provide:                         

o    merchandise at wholesale prices, including a franchise fee;                
o    various support services, including logistical and warehouse services; and 
o    management  support and training,  marketing support and administrative and
financial assistance.                                                 

Franchise  agreements typically have a term of five years, and are renewable for
additional five-year terms.  Franchise stores are primarily smaller stores, with
46% of franchise  stores having a sales area of less than 8,600 sq. ft. (800 m2)
while company-owned stores are generally larger, with only 22% of company stores
having a sales area of less than 8,600 sq. ft. (800 m2).                        

Other retailing in The Netherlands includes our specialty retailing  operations,
which are  organized as a separate  group.  The  companies in this group include
Gall & Gall and Etos.  Gall & Gall  operates  wine and spirit  stores,  and Etos
operates stores specializing in health, beauty care and natural products. Gall &
Gall store sales are  supplemented  by an  internet-based  order-entry  and home
delivery  system.  In August 2000,  Etos  reached an agreement  with the British
drugstore chain,  Boots, to acquire 17 Boots outlets in The Netherlands.  By the
end of 2000,  the stores were  remodeled  to the Etos  format.  As of the end of
2000,  Gall & Gall operated 330 stores and supplied 156  franchise  stores while
Etos  operated 219 stores and supplied 261  franchise  stores.  Other  specialty
operations  include  confectionery  stores,  operating  under the name  "Jamin".
However,  in March 2001, we announced  that we have signed a letter of intent to
divest  Jamin,  because  with net sales in fiscal 2000 of  approximately  EUR 36
million,  the  scale of its  operations  is no longer  consistent  with our core
activities.                                                                     

Schuitema  provides goods and services to  approximately  420  independent  food
retailers operating under various trade names and formats. Schuitema and certain
independent  food retailers are members of an association that has developed and
controls several store formats,  including C1000, Spar Voordeelmarkt,  Kopak and
Casper. Schuitema services these associated stores, which accounted for over 90%
of  Schuitema's  sales for fiscal 2000.  Prior to the end of fiscal 2000,  these
sales to associated stores were classified as part of the previously named "Food
wholesaling  and food supply"  business  segment.  Schuitema also supports these
independent  member  retailers,  on a commercial  level,  and in some instances,
financially.  In October 2000,  Schuitema  completed its  acquisition of 123 A&P
supermarkets and six hypermarkets  from the Dutch Hermans Group. The stores will
be converted to the C1000 format.  As of fiscal year end 2000,  Schuitema  owned
122 former A&P  supermarkets  and six  hypermarkets and serviced 423 independent
food retail stores.                                                             

Scandinavia                                                                     
In April 2000, we acquired a 50% partnership  interest in the ICA Group ("ICA"),
for approximately  EUR 1.8 billion in cash. ICA is a prominent,  integrated food
retail  and  wholesale   group,   servicing   over  3,100   retailer-owned   and
company-owned  supermarkets,  superstores,  hypermarkets  and discount stores in
Sweden,  Norway and the Baltic states,  with annual net sales of EUR 7.0 billion
as of the end of fiscal 2000.                                                   

In Sweden, ICA supported over 1,950 stores as of the end of fiscal 2000, most of
which were  retailer-owned  and  operated.  ICA,  including  the  retail  stores
associated  with ICA,  has been a market  leader in Sweden  since 1966.  All ICA
retailers  in  Sweden  are  members  of  the  ICA  Forbundet   (ICA   retailers'
association).  The majority of the ICA retailers are only linked to ICA by their
membership of ICA Forbundet.  Besides this membership,  approximately 40% of the
ICA retailers,  representing  approximately  75% of the store sales, have an ICA
agreement,  under which ICA has a minority stake in the store and normally holds
or rents  the real  estate  or  other  premises.  There  are also  store  format
agreements  with  almost all ICA  stores,  linking  the stores and their  market
behavior  together with ICA. The Rimi discount  stores operate under a franchise
agreement,  under which ICA, charging a franchise fee, has agreed to provide the
trademark,  the general  store  concept,  various  support  services,  including
purchasing,   management   support   and   training,   marketing   support   and
administrative and financial  assistance.  These franchise  agreements typically
have  an  indefinite  term,  but  may  be  terminated  by  ICA  in a  number  of
circumstances  and by the franchisee by giving three months prior notice.  As of
December 31, 2000, the store portfolio consisted of 1,135 ICA Nara neighbourhood
stores, 126 ICA Kvantum large supermarket stores, 552 ICA Supermarked stores, 24
MAXI ICA Stormarknad  hypermarkets  and 121 Rimi discount  stores.  These stores
generated approximately EUR 8.1 billion of consumer sales (including Value Added
Taxes) in 2000.                                                                 

In Norway,  Hakon Gruppen serviced 1,142 stores at the end of fiscal 2000, which
are either  company-owned or  retailer-owned  with franchise  agreements or with
cooperation agreements. For each franchisee, Hakon Gruppen has agreed to provide
products, service and development resources, and in many cases owns or holds the
premises and store equipment necessary for the operations of the franchisee. The
franchise  agreements  typically have a term of five years and are renewable for
additional terms. In Norway, the Rimi format is the largest daily food format in
the  country,  though  Hakon  Gruppen was the second  largest in terms of retail
market share. As of the end of fiscal 2000, the store  portfolio,  excluding the
345  associated  stores  with  cooperation  agreements,  consisted  of 521  Rimi
discount stores, 85 ICA supermarkets, 171 Sparmat stores, nine Maxi hypermarkets
and 11 other stores. The associated stores use various store formats. The stores
in Norway  generated  approximately  EUR 2.4 billion of consumer sales in fiscal
2000.                                                                           

In  addition,  ICA owns  stores in the  Baltic  states:  22 in Latvia and two in
Estonia,  and operates 27 stores  through a non-  consolidated  joint venture in
Lithuania as of the end of fiscal 2000.                                         

ICA has a  non-consolidated  50/50 joint  venture  with Statoil  called  Statoil
Detaljhandel  Scandinavia AS ("Statoil Retail").  Statoil Retail generated sales
of EUR 3.2  billion  in  fiscal  2000.  Statoil  Retail  operates  and  services
approximately 1,500 Statoil gas stations and forecourt stores in Denmark, Norway
and Sweden.  ICA was consolidated in our financial  statements  beginning May 1,
2000.  During fiscal 2000 ICA continued  expansion.  In February,  13 Interpegro
stores in Latvia  were  acquired.  In  November,  ICA Baltic  acquired 12 stores
through  its  Lithuanian  joint-venture.  In Denmark  ICA has  strengthened  its
presence  through  the  acquisitions  of 50% of the shares of ISO  Supermarkets,
which  reported sales of EUR 160 million in 2000 and which operates 11 stores in
the greater Copenhagen area.                                                    

Portugal                                                                        
In 1992,  we became a 49% partner with  Jeronimo  Martins,  SGPS,  S.A.  ("JM").
Through this partnership,  we created Jeronimo Martins Retail,  also referred to
as "JMR", in Portugal. JMR owns both Pingo Doce, which at the end of fiscal 2000
operated 187  supermarkets,  and Feira Nova,  which as of the end of fiscal 2000
operated 23 hypermarkets.  Pingo Doce is a major  supermarket chain in Portugal,
offering a wide  variety  of  products  at  competitive  prices.  The Feira Nova
hypermarkets offer a wide variety of food and non-food products at low prices.  

In January 2000, we announced that we were in  discussions  regarding the nature
of our partnership with JM. Various options for the continuation and development
of the joint venture have been  discussed.  On March 30, 2001, JM announced that
it intents to continue the partnership with us and not to exercise the option to
buy our 49% interest in JMR.                                                    

Czech Republic                                                                  
Ahold Czech  Republic,  formerly  known as  Euronova,  is an indirect  99% owned
subsidiary, which began food retail operations in the Czech Republic in 1991. As
of the end of fiscal 2000, Ahold Czech Republic operated 190 food retail stores,
making it one of the largest food  retailers in the country as measured by sales
volume.  In fiscal 2000 we announced our expansion into Slovakia.  As of the end
of fiscal year 2000, we had 158 stores  operating  under the name  "Albert",  27
"Prima" mini-hypermarkets and five "Hypernova" hypermarkets.                    

Poland                                                                          
In  1995,  we   established   a  50/50  joint   venture  with  German   retailer
Allkauf-Gruppe  to develop  retail  operations  in Poland.  In January  1999, we
purchased  Allkauf-Gruppe's  share of the joint  venture and renamed the company
Ahold Polska in February  1999.  As of the end of fiscal end 2000,  Ahold Polska
operated 84 discount food stores operating under the name Sesam, 53 supermarkets
operating  under the name Max and nine  hypermarkets  and three other  stores in
Poland.                                                                         

Spain                                                                           
In 1996, we  established  Store2000,  through a joint  venture with  Caprabo,  a
privately-held  food  retailing  company based in Barcelona,  Spain.  In October
1998, we sold our interest in the joint venture.  In 1998, we acquired 15 stores
from Longinos Velasco through our wholly-owned  subsidiary Ahold  SuperMercados.
In 1999,  we expanded  our  operations  in Spain by  acquiring  Dialco,  Dumaya,
Castillo del Barrio, Guerrero,  Mercasol and Las Postas supermarket chains which
operated a total of 160 stores.                                                 

In January 2000, we acquired Kampio, a prominent  regional  supermarket chain in
Catalonia. The chain operates 39 large supermarkets,  of which 24 are located in
Barcelona,  and had sales of  approximately  EUR 118 million in fiscal 2000.  In
December  2000,  we  completed  a tender  offer to acquire  the  majority of the
outstanding  shares in  Superdiplo,  S.A.  ("Superdiplo").  Superdiplo  reported
annual sales during  fiscal 2000 of  approximately  EUR 1.5 billion and operates
341 stores on the Canary Islands, in Andalusia and the greater Madrid region. As
of the end of fiscal 2000, we operated 582 stores in Spain.  In January 2001, we
announced our intention to acquire Cemetro, S.L., which is subject to regulatory
approval.  For more information,  please see Item 5 - "Operational and Financial
Review and Prospects - Recent Developments".                                    

We intend to develop further and expand in Spain through our existing operations
as well as through acquisitions.                                                

Retail Trade in Latin America                                                   

We  have  retail  operations  in  Brazil,  Argentina,   Chile,  Peru,  Paraguay,
Guatemala,  El Salvador and in Honduras.  The following  table sets out, for the
periods  indicated,  net sales in millions of euros, store count and sales area,
in thousands of square feet, for our retailing operations in Latin America:     

                                                        [Enlarge/Download Table]

                             Latin American Retail Trade Sales, Store Count and Sales Area                          

                                                            As of and for the Fiscal Year Ended                     
                                                2000                         1999                       1998        
                                                                (sales in millions of EUR)                          
                                        Net     Store     Sales     Net      Store    Sales     Net     Store  Sales
                                       Sales    Count     Area     Sales     Count    Area     Sales    Count   Area
                                                                                                                    
Bompreco                               1,515      106     3,151    1,167      100     2,848    1,590      91   2,538
Disco (1)                              2,174      235     3,017    1,652      213     2,392      353     111   1,658
Santa Isabel (1)                         764       96     1,764      678       95     1,831      173      90   1,768
La Fragua (1)                            629      130     1,324       --      122     1,325       --      --      --
                                       -----      ---     -----    -----      ---     -----    -----     ---   -----
Total Latin America                    5,082      567     9,256    3,497      530     8,396    2,116     292   5,964
                                       =====      ===     =====    =====      ===     =====    =====     ===   =====

---------------                                                                                                     
(1)  These subsidiaries are not wholly-owned by us. For more information, please see Item 19 - "Exhibits".          

 Changes in Store Count in Latin America

                     Fiscal Year
                     2000                 1999                1998

Beginning of period          530                  292                  93       
Opened/acquired               51                  241                 201       
Disposed/closed              (14)                  (3)                 (2)      
                      ----                 ---                 ---
End of period                567                  530                 292       
                      ===                  ===                 ===

Brazil                                                                          

In December 1996, we entered the Latin American market through an agreement with
Bomprecopar  S.A. Under this agreement we indirectly  acquired 50% of the voting
shares and 50.1% of the total capital of Bompreco S.A. Supermercados do Nordeste
or "Bompreco". Bompreco is the leading food retailer in north-eastern Brazil. In
June  1997,  Bompreco  acquired  SuperMar,   a  regional  supermarket  chain  in
north-eastern  Brazil,  which was  subsequently  renamed Bompreco Bahia S.A. All
Bompreco Bahia stores operate under the Bompreco and Hyper  Bompreco  names.  In
July 2000,  we acquired the remaining 50% of the voting shares and an additional
10.9% of the non-voting shares of Bompreco.  As a result, we currently own 85.9%
of the total capital of Bompreco,  including all of the voting shares. As of the
end of fiscal 2000,  Bompreco operated 106 supermarkets,  hypermarkets and other
food retail stores, including 50 Bompreco Bahia stores.                         

Argentina, Chile, Peru and Paraguay                                             
We  continued  to  develop  our  Latin  American   operations  through  our  50%
partnership,  Disco Ahold International  Holdings,  or "DAIH", with Velox Retail
Holdings which was established in January 1998. The partnership controls a 98.1%
stake in Disco, the largest supermarket company in Argentina based on net sales,
and a 69% interest in Santa Isabel,  the second largest  supermarket  company in
Chile and Peru  based on net sales and with  operations  in  Paraguay.  In 1999,
Disco acquired the Supamer,  Gonzalez and Pinocho supermarket chains. In January
2000,  Disco  continued to expand  acquiring 100% of the  outstanding  shares of
Supermercados Ekono S.A.  ("Ekono").  Disco operated 235 stores as of the end of
fiscal 2000.                                                                    

As of the end of fiscal 2000, Santa Isabel operated 96 stores, with 62 stores in
Chile, 25 in Peru and nine in Paraguay.                                         

Guatemala, El Salvador and Honduras                                             
In December 1999, we established a 50/50 partnership, Paiz Ahold, which controls
an 80.5% stake in La Fragua, the leading  supermarket and hypermarket company in
Guatemala with a presence in El Salvador and Honduras.  The partnership  intends
to expand the retail  activities  of La Fragua in the  region.  As of the end of
fiscal  2000,  La  Fragua  operated  102  stores in  Guatemala,  20 stores in El
Salvador and eight in Honduras.  These 130 stores  comprised 99 discount stores,
26 supermarkets and five hypermarkets.                                          

Retail Trade in Asia Pacific                                                    

In 1999, we restructured our presence in Asia Pacific,  focusing on Thailand and
Malaysia. As a result, we sold our stake in unprofitable operations in China and
our  partnership  in  Singapore  sold its 14 stores to Dairy Farm  International
during the fourth  quarter of 1999. In 1996 we formed a partnership in Malaysia,
with  companies  of the  Kuok  Group.  The  Malaysian  partnership,  Ahold  Kuok
Malaysia,  acquired  the  Parkson  and  Looking  Good store  chains in 1998.  In
December  2000,  we  became  100%  owner of our  Malaysian  operations  (after a
reduction  in 1998 to 52% and an  increase  to 65% in 1999),  which  included 39
stores as of the end of fiscal 2000.                                            

Early in 1997, we entered into a 49%-owned consolidated  partnership in Thailand
with the Central Robinson Group,  CRC Ahold Thailand.  In 1998, we acquired 100%
ownership of the partnership,  subject to repurchase options of up to 50% of the
outstanding  shares  granted to the  Central  Robinson  Group.  As of the end of
fiscal 2000, CRC Ahold Thailand operated 41 stores in Thailand.                 

In July 1997,  we entered  into a technical  assistance  agreement  with the PSP
Group in Indonesia in connection with the potential development of a supermarket
chain in that country.  As of the end of fiscal 2000,  the PSP Group operated 17
stores in Indonesia.                                                            

As of the end of fiscal  2000,  we,  partly  through  partnerships,  operated 97
retail  stores in Asia Pacific.  We believe  that,  despite the losses in fiscal
years 1999 and 2000, the Malaysian, Thai and Indonesian retail food market offer
medium to long term opportunities for expansion and growth.                     

Food Service                                                                    

The United States                                                               
In April 2000,  we acquired U.S.  Foodservice  for  approximately  $3.6 billion,
including the assumption of approximately $925 million in debt. U.S. Foodservice
is the second largest food service  distributor  in the United States,  based on
its net sales for fiscal 2000.  As of the end of fiscal 2000,  U.S.  Foodservice
operated  65  marketing  and  distribution  outlets and  serviced  approximately
200,000  customers.   U.S.  Foodservice  sells  food  and  related  products  to
restaurants  and other  institutional  food service  establishments  through its
national distribution networks. U.S. Foodservice also purchases, stores, markets
and transports food products, paper products and other supplies and food related
items for  establishments  that  prepare  and serve  meals to be eaten away from
home. U.S. Foodservice was consolidated in our financial statements beginning of
the second quarter of fiscal 2000.                                              

In July 2000, U.S. Foodservice  completed its acquisition of GFG Foodservice,  a
large  broadline  distributor  in North  Dakota and South  Dakota  and  northern
Minnesota.  Headquartered  in Grand Forks,  North  Dakota,  GFG  operates  three
distribution  centers and services over 4,300  accounts.  GFG generated sales of
approximately  $110  million  in 2000  and  was  consolidated  in our  financial
statements as of the beginning of the third quarter of fiscal 2000.             

In December 2000, U.S. Foodservice  completed its acquisition of PYA/Monarch,  a
food  service  distributor  in the  southeastern  United  States.  Previously  a
subsidiary  of Sara Lee  Corporation,  PYA/Monarch  provides  food and  non-food
items, including private label brands, to nearly 40,000 customers. PYA/Monarch's
customer base includes national  restaurant  chains,  health care  institutions,
universities  and  hotels.  PYA/Monarch  operates  15  distribution  centers and
generated sales of  approximately  $3.5 billion in fiscal 2000.  PYA/Monarch has
been consolidated in our financial statements as of December 2000.              

Europe                                                                          
We are a  leading  food  service  distributor  in The  Netherlands  through  our
subsidiary, Deli XL. Deli XL provides a wide range of food and non-food products
to hospitals,  schools,  other  customers and hospitality  enterprises,  such as
hotels and restaurants.                                                         

In October 2000,  Deli XL completed its  acquisition of the Belgian food service
company  MEA-De  Wilde-De Loore ("MEA") from Compass Group plc. As of January 1,
2001,  MEA operated  under the name Deli XL. Based in Charleroi,  Deli XL is the
market  leader in Belgium  with sales in fiscal  2000 of  approximately  EUR 100
million.  MEA was  consolidated  in our  financial  statements  as of the  third
quarter of 2000.                                                                

In Sweden,  we engage in food  service  activities  through our 50%  partnership
interest in ICA under the name "ICA  Menyforetagen".  ICA Menyforetagen  manages
operations in restaurant catering and convenience stores.                       

Real Estate                                                                     

As of the end of fiscal  2000,  we  operated  two real estate  companies  in the
United States, under the names Ahold Real Estate Company or "ARC" and Ahold Real
Properties  or "ARP".  Ahold  Vastgoed  or AVG, a  100%-owned  Dutch real estate
subsidiary,  is engaged in the acquisition,  development and management of store
locations  in The  Netherlands,  the  Czech  Republic  and  Slovakia.  For  more
information  on our real  estate  companies,  see below under  "Stores,  Support
Facilities and Related leases".                                                 

Other Activities                                                                

Our other activities in fiscal 2000 primarily include a food production  company
"Marvelo", operating as an independent profit center. The company is principally
engaged in  producing a portion of Albert  Heijn's  private  label  products and
selling to third parties.  Major product groups include coffee, tea and wine. In
March 2001,  we announced  that we had signed a letter of intent to sell four of
Marvelo's product groups to third parties.  For further information see Item 5 -
"Operating and Financial Review and Prospects - Recent Developments".           

Unconsolidated Companies                                                        

We had investments of EUR 408 million in unconsolidated  companies as of the end
of fiscal 2000,  relating  primarily to investments by ICA in Statoil Retail and
by  Schuitema  in  an   unconsolidated   company  "Eembrug  CV",  which  owns  a
distribution  center  and real  estate  in The  Netherlands.  Other  investments
include our interest in "Luis Paez SA", a Spanish wine producer.                

Seasonal variation regarding the business of Royal Ahold                        

Sales relating to our food service  business,  and to a lesser extent our retail
trade business, vary depending on the season of the year. Generally,  during the
second  half of the year,  sales are  higher  than  during  the first  half.  We
generally  experience  our highest sales in December,  due mainly to the holiday
season. Seasonality does not materially affect our business.                    

Dependence on Intellectual Property                                             

We own a number of registered  and pending  trademarks,  including the marks for
our  product  line  names  and  the  trade  names  and  logos  under  which  our
subsidiaries and joint venture partnerships conduct their businesses.  Our trade
names and trademarks are not of material importance to our operations.          

European Cooperative Association                                                

We are a member of a group of 10 European retailers cooperating in AMS Marketing
Service  B.V., a Swiss  company  engaged in organizing  and  supervising  active
cooperation between retailers and manufacturers in Europe to reduce distribution
and production costs.                                                           

Stores, Support Facilities and Related Leases                                   

As of the end of fiscal 2000,  we operated  6,399 retail  stores and 386 support
facilities   (warehouse/distribution   centers,   offices  and  food  processing
facilities).  Of these  locations,  23% were  owned by us,  12% were held  under
capital leases and 65% were held under  operating  leases.  The following  table
summarizes  our property  locations as of fiscal year end 2000,  by industry and
geographic segment:                                                             

                                                        [Enlarge/Download Table]

                                                                                               Percentage of locations         
                                                                       Retail  Support                     Capital   Operating 
                                                                       Stores facilities    Total   Owned   lease      lease   
                                                                                                                               
Retail Trade                                                                                                                   
United States                                                           1,313       50      1,363     12%     35%        53%   
Europe (1)                                                              4,422      179      4,601     25%      5%        70%   
Latin America                                                             567       45        612     41%      5%        54%   
Asia Pacific                                                               97       10        107      4%     27%        69%   
                                                                        -----      ---      -----                              
                                                                        6,399      284      6,683     23%     12%        65%   
                                                                        =====      ===      =====     ===     ===        ===   

Food Service                                                                                                                   
United States                                                              --       70         70     51%      1%        48%   
Europe                                                                     --       28         28     54%      0%        46%   
                                                                           --       --         --                              
                                                                           --       98         98     52%      1%        47%   
Other Activities                                                                                                               
Europe                                                                     --        4          4      0%      0%       100%   

---------------                                                                                                                
(1)  Retail store count does not include the  acquisition of  Superdiplo,  which operated 341 stores in Europe as of the end of
     fiscal 2000. For more information on Superdiplo please see Item 5 - "Operating and Financial Review and Prospects - Recent
     Developments".                                                                                                            


Retail Trade                                                                    
In the  United  States,  our  subsidiaries  operated  1,313  retail  stores,  32
distribution centers, four stand-alone  pharmacies,  one production facility and
13 office  locations as of the end of fiscal 2000. In February 2001,  certain of
our U.S.  subsidiaries  sold 34 retail  stores and 12  non-retail  properties to
unaffiliated purchasers. The purchasers then leased the properties to one of our
wholly-owned  subsidiaries.  For a further  discussion  of the  leveraged  lease
transactions,  please see Item 5 - "Operating and Financial Review and Prospects
- Recent  Developments".  All of our  operations in the United States are in the
eastern  part of the  country.  The  terms of the  leases in the  United  States
typically  range from 10 to 25 years and contain  renewal  options.  Also in the
United  States,  our retail  subsidiaries  lease or own 97 other sites which are
generally former supermarket locations or sites held for future development.  Of
these  additional  sites not in company  use,  52% have been  subleased to third
parties.                                                                        

In Europe,  our  subsidiaries  operated  4,422 retail  stores,  83  distribution
centers,  ten  production  facilities  and 86 office  locations as of the end of
fiscal 2000. In The Netherlands, we operated a total of 2,407 stores and support
facilities,  not including  associated stores,  mainly under the names of Albert
Heijn,  Gall & Gall,  Etos,  Jamin,  Ter  Huurne  and  A&P.  The  stores  in The
Netherlands   are   generally   rented  under   contracts   which   provide  for
non-cancelable,  five to ten year periods with renewal  options,  and with rents
which may be  adjusted  annually  based on  predetermined  indices.  Our  retail
companies in The Netherlands also own or lease 224 other sites, all of which are
leased to franchisees.                                                          

As of the end of fiscal 2000, we also operated 256 stores and support facilities
in Spain, 214 in Portugal, 155 in Poland, 202 in the Czech Republic and 1,367 in
Scandinavia,  not including  associated  stores which are supplied by ICA, since
some of these associated  stores are owned by third parties and subleased to the
independent  retailers  operating the  associated  stores.  Lease terms on these
properties  generally  range  from  five to ten  years,  with  renewal  options.
Additionally,  663 other  locations are controlled by our  subsidiaries in these
countries,   which  are  not  currently  being  used  for  our  own  operations.
Substantially all are subleased to third parties.                               

In Latin America,  we operated 567 retail stores,  17 distribution  centers,  13
production  facilities  and 15 office  locations  as of the end of fiscal  2000.
Leased locations  generally  operate under lease terms of four to ten years with
renewal  options.  Our retail  companies in Latin  America also control 18 other
stores  and one  warehouse  which  are not  currently  in use,  of which 14% are
subleased to third parties.                                                     

As of the end of fiscal  2000,  our Asia Pacific  operations  included 97 retail
stores,  four distribution  centers and six office locations.  Leased facilities
operate under lease terms of five to ten years.                                 

Food Service                                                                    
In the United  States,  we  operated  65  distribution  centers  and five office
locations as of the end of fiscal 2000 under the names of U.S.  Foodservice  and
PYA/Monarch.  Additionally,  these  subsidiaries  controlled 14 other facilities
which are currently not in use.                                                 

In Europe,  we operated 25 distribution  centers in The Netherlands and Belgium,
one of which is partially used for office space,  and one other office  location
under the name of Deli XL. Additionally,  Deli XL controls one warehouse that is
currently not being used. We also  operated two  distribution  centers under the
name of ICA Menyforetagen in Scandinavia.                                       

Other Activities                                                                
Other  activities  consist  of one  production  facility  operated  by our  food
processing  company  in The  Netherlands  under  the name of  Marvelo  and three
corporate  offices  located  in  The  Netherlands  and  Belgium.  All  of  these
facilities are currently leased.                                                

Real Estate                                                                     
As of the end of fiscal 2000, we operated  three real estate  companies,  two in
the United  States under the names of Ahold Real Estate  Company (ARC) and Ahold
Real Properties  (ARP) and one in The  Netherlands  under the name of AVG. These
companies are involved in the acquisition, development, and management of retail
sites in  support  of our  retail  operations.  In  doing  so,  the real  estate
companies  may  own  or  lease  individual  store  sites,  shopping  centers  or
buildings. Locations controlled by these real estate companies and rented to our
consolidated  subsidiaries  are included in the "Store,  Support  Facilities and
Related  Leases"  table  above  under the  segment  using the  property  and are
included as owned or leased based on the interest of ARC, ARP or AVG.           

In addition to the locations rented to our companies,  the real estate companies
may own or lease locations which are adjacent to our store sites, locations held
for future development or rented to third-parties.                              

As of the end of fiscal 2000, ARC and ARP controlled a total of 153  properties,
almost  all of which  are  rented  to our  subsidiaries.  AVG  controlled  2,261
properties of which 52% are rented to our subsidiaries.                         

Expansion Plans                                                                 
For a  discussion  of our plans to  construct,  expand and  improve  facilities,
please see Item 5 - "Operating  and  Financial  Review and Prospects - Strategic
Outlook".                                                                       

ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS                            

In this section,  we explain our general financial  condition and the results of
our operations.  As you read the following  discussion and analysis,  you should
refer to our consolidated financial statements and the related notes thereto for
fiscal years 2000, 1999 and 1998 contained in Item 18 of this annual report.  We
prepare our consolidated financial statements in accordance with Dutch GAAP. See
note 23 to the consolidated  financial  statements,  included  elsewhere in this
annual  report for a discussion of the principal  material  differences  between
Dutch GAAP and U.S. GAAP, which apply to our consolidated  financial statements.
Our results from  operations for fiscal 1998 include  Disco's and Santa Isabel's
operating results from the beginning of the fourth quarter and  Giant-Landover's
operating  results from October 28, 1998.  Our results for fiscal year 1999 were
affected by the full year results of these acquisitions as well as the July 1999
acquisition of Gastronoom and several  supermarket  chains in Spain. Our results
for fiscal  2000 were  affected  by the  operating  results  of La Fragua,  U.S.
Foodservice and ICA. Consolidation began January 2, 2000, April 23, 2000 and May
1, 2000,  respectively.  Our results were to a lesser  extent  influenced by the
operating  results of the  acquisitions of PYA/Monarch,  the A&P Group,  Peapod,
Kampio and Ekono.                                                               

Our U.S. and Dutch  operations  for fiscal  years 2000 and 1999  consisted of 52
weeks of results,  while fiscal 1998 consisted of 53 weeks.  The other European,
Latin American and most of the Asia Pacific  operations were consolidated in our
financial statements report on a calendar-year basis. As a result, the net sales
and expenses for fiscal  years 2000 and 1999 in  comparison  to fiscal year 1998
reflect the  difference  of one week of operating  results for the United States
and The Netherlands, and to this extent do not reflect changes in our underlying
business.                                                                       

Overview                                                                        

Net sales in fiscal 2000 were EUR 52,471 million  compared to EUR 33,560 million
in fiscal 1999 and EUR 26,484 million in fiscal 1998,  representing increases in
net sales of 56% in fiscal 2000 and 27% in fiscal  1999.  Net earnings in fiscal
2000 were EUR 1,116  million  compared to EUR 752 million in fiscal 1999 and EUR
547 million in fiscal  1998,  representing  increases  in net earnings of 48% in
fiscal 2000 and 37% in fiscal 1999. Earnings per common share were EUR 1.51, EUR
1.14  and  EUR  0.91  in  fiscal  years  2000,  1999  and  1998,   respectively,
representing an increase of 32% in fiscal 2000 and 25% in fiscal 1999.          

Forward-Looking Statements                                                      

For a discussion  regarding  forward-looking  statements,  see  "Forward-Looking
Statements"  in the  front of this  annual  report  under the  heading  "General
Information".                                                                   

Euro Conversion                                                                 

On January 1, 1999,  certain member countries of the EU established a new single
currency  known  as  the  euro.  For  the  three  years  thereafter  there  is a
transitional  period  during  which  certain  EU  member  country  will have two
currencies, the euro and its local currency, for electronic fund transfers. Dual
pricing of goods and services in euro and local currency is already  established
in most of the countries  participating  in the EU, in particular in our markets
in Spain and Portugal. In The Netherlands dual pricing was introduced on January
1, 2001.  In the relevant EU  countries  there is a movement to shorten the dual
currency  period,  i.e., the period in which the national  currency and the euro
notes and coins will  coincide,  to a maximum of two months  after the  official
introduction on January 1, 2002. In The Netherlands, a dual currency period of a
maximum of four weeks has been decided upon by the government.  Final details of
the dual currency period have yet to be established.                            

The  introduction  of the euro will have a  significant  effect on our  European
operations and financial  systems.  The impact of the euro can be separated into
two main effects:                                                               

o    business-to-business conversion, and                                       
o    business-to-consumer conversion.                                           

For  the  business-to-business   conversion,   that  is  the  transfer  to  euro
denominated billing, we have been in formal communications with our suppliers to
establish a conversion date. For Albert Heijn in The Netherlands,  more than 80%
of our suppliers  already send euro denominated  invoices.  Business-to-consumer
conversion,  that is, the introduction of the euro notes and coins, has a larger
effect.  Several  issues  have  been  identified,  and  action  plans  have been
developed and put into practice to address these issues.  The largest concern is
consistent  pricing  of  our  products  in the  relevant  EU  countries.  Due to
differences in distribution structures, overhead costs and competitive pressure,
the  introduction  of the euro is not expected to lead  immediately  to consumer
pricing equivalency in the relevant EU countries. However, the price differences
among  the EU  countries  may  diminish  in the long  run as a  result  of price
transparency.                                                                   

As of the  end of  fiscal  2000,  our  consolidated  balance  sheet  included  a
provision of EUR 14 million for the introduction of the euro. During fiscal 2000
and 1999 we recorded expenses of EUR 8 million and EUR 3 million,  respectively,
relating to the euro issues and we expect to spend EUR 12 million in fiscal 2001
and EUR 2  million  in  2002.  These  projected  costs  are  based  on our  best
estimates, which were derived using a number of assumptions as to future events,
including the continued  availability of certain resources.  However, our actual
results could differ materially from those anticipated.                         

Acquisitions and Consolidations                                                 

Acquisitions are a key component of our growth strategy in the United States, in
Europe and in the  relatively  underdeveloped  markets of Latin America and Asia
Pacific.  We have substantially  expanded our business through  acquisitions and
new partnerships in fiscal years 2000, 1999 and 1998.  During these three years,
we completed 15 principal business acquisitions, with an aggregate consideration
of  approximately  EUR  14.9  billion  in cash  and  assumed  indebtedness.  Our
acquisition  program has considerably  broadened the  geographical  scope of our
business.  Through the  acquisitions  and new  partnerships  completed in fiscal
years 2000,  1999 and 1998,  we have  established  a  significant  presence in a
number  of  new  markets,  including  Scandinavia,   Guatemala,  Spain,  Brazil,
Argentina and Chile, in addition to  significantly  expanding  operations in the
United States.                                                                  

During  fiscal years 2000,  1999 and 1998,  we completed  the  acquisitions  and
partnership  investments  set forth  below.  The store  counts  indicated  below
represent  the  number of stores  operated  at the time of  acquisition,  unless
otherwise indicated.                                                            

o    Superdiplo:  On September 7, 2000, we announced plans to acquire all of the
     outstanding shares of the Spanish food retailer,  Superdiplo, S.A. by means
     of a public tender offer.  Superdiplo  operates over 300 stores in Southern
     Spain, Andalusia,  the Canary Islands and the greater Madrid region as well
     as two stores in Northern Morocco.  On September 7, 2000, we also announced
     that  we had  signed  an  agreement  with  several  major  shareholders  of
     Superdiplo  holding in the aggregate  69.16% of the  outstanding  shares of
     Superdiplo in which the major shareholders agreed, pursuant to the terms of
     the tender  offer,  tender  their  shares in  Superdiplo  at a rate of 0.74
     common shares of Royal Ahold for every  Superdiplo  share held,  subject to
     certain  adjustments.  Also on September 7, 2000,  our Corporate  Executive
     Board  authorized a capital  increase of up to 42,207,000 new common shares
     to be used as consideration for the tendered Superdiplo shares. On November
     25, 2000 we launched our public tender offer for the outstanding  shares in
     Superdiplo.  On  December  27,  2000,  the  tender  offer was closed and on
     December 29, 2000,  we issued  36,849,875  Royal Ahold  common  shares.  On
     January 3, 2001,  we  exchanged  the  36,849,875  newly  issued Royal Ahold
     common shares for 49,797,129 Superdiplo shares,  representing 97.64% of the
     outstanding  share  capital  in  Superdiplo.  Superdiplo  shareholders  who
     tendered  their shares  received  0.74 new common  shares of Royal Ahold in
     exchange  for  every  Superdiplo  share  tendered.  The  balance  sheet  of
     Superdiplo was consolidated as of year end 2000, as we obtained  beneficial
     ownership  on December  29, 2000,  but none of the  operating  results were
included in our consolidated statement of earnings for fiscal 2000.   

o    PYA/Monarch:  In December 2000, U.S. Foodservice  completed its acquisition
     of  PYA/Monarch,  a food service  distributor  in the  southeastern  United
     States for a total  cash  consideration  of  approximately  $1.57  billion.
     PYA/Monarch  was  previously  a  subsidiary  of Sara Lee  Corporation.  For
     further information on PYA/Monarch, please see Item 4 - "Information on the
     Company - Food Service - The United  States.  For  information  relating to
     financing of this acquisition, please see Item 5 - "Operating and Financing
     Review  and  Prospects  -  Liquidity  and  Capital  Resources  -  Financing
Activities" and "Recent Developments".                                

o    The A&P Group: In September 2000,  Schuitema  acquired the A&P Group in The
Netherlands with 123 supermarkets and six hypermarkets.               

o    Bompreco:  In June 2000, we acquired the  remaining  voting rights from the
other shareholders of Bompreco in Brazil.                             

o    Peapod: In June 2000, we acquired series B convertible  preferred stock and
     warrants to acquire common stock of the U.S.  on-line  grocer Peapod,  Inc.
     Each  share of  preferred  stock  entitles  the holder to the vote that the
     holder  would be entitled to cast had the holder  converted  the  preferred
     stock into common  stock.  In addition the holders of the  preferred  stock
     have voting rights relating to the election of the directors. The preferred
     stock was convertible into shares of common stock that, after giving effect
     to such conversion,  would have represented  approximately  51% of Peapod's
     outstanding  common  stock.  The warrants  issued in June 2000,  along with
     warrants we  acquired  from Peapod in April  2000,  in  consideration  of a
     revolving  credit  facility  that we provided  to Peapod,  enable us to buy
     additional shares of common stock. In October 2000, we purchased  2,331,917
     shares of Peapod  common  stock in an open market  transaction.  In October
     2000, we exchanged the series B  convertible  preferred  stock for series C
     convertible  preferred stock of Peapod,  which is convertible into the same
     number  of shares of common  stock as the  series B  convertible  preferred
     stock. If we were to convert all of the preferred stock to common stock and
     exercise all of the  warrants,  our  beneficial  ownership of Peapod common
     stock would represent approximately 78.9% of Peapod's outstanding stock. In
     September 2000,  Peapod acquired various assets of  Streamline.com,  a U.S.
     on-line  shopping and delivery  service  based in Westwood,  Massachusetts.
     Peapod paid  approximately  $12 million for the Washington,  D.C./Baltimore
     area  facilities  of  Streamline,  which  are  expected  to be  used in the
development of Giant-Landover's internet-based home delivery services.

o    The ICA Group:  In April 2000,  we acquired a 50%  partnership  interest in
     ICA, the largest  Scandinavian  food retailer,  for  approximately  EUR 1.8
     billion  in cash.  ICA was  formed in early  1999 when ICA AB  acquired  an
     additional  55% of Norway's  Hakon  Gruppen AS, which became a wholly owned
     subsidiary.  In August  1999,  ICA entered  into a  non-consolidated  50/50
     joint-venture  with Statoil.  For further  information on ICA's  operations
     please see Item 4 - "Information  on the Company - Retail Trade in Europe".
     For  further  information  relating  to the  financing  of our  partnership
     interest in ICA,  please see Item 5 - "Operating  and Financial  Review and
Prospects - Liquidity and Capital Resources - Financing Activities".  

o    U.S. Foodservice:  In April 2000, we acquired U.S. Foodservice,  the second
     largest food service  distributor in the United States,  based on net sales
     for approximately  $3.6 billion,  including the assumption of approximately
     $925  million  in  debt.  In  July  2000,  GFG  Foodservice,   a  broadline
     distributor  in North  Dakota,  South  Dakota and  northern  Minnesota  was
     acquired by U.S. Foodservice.  For further information on U.S. Foodservice,
     please see Item 4 - "Information on the Company - Food Service - The United
     States".   For  further  information  relating  to  the  financing  of  the
     acquisition,  please see Item 5 -  "Operational  and  Financial  Review and
Prospects - Liquidity and Capital Resources - Financing Activities".  

o    Kampio:  In January  2000,  we acquired the  Catalonian  supermarket  chain
Kampio, based in Barcelona.                                           

o    Ekono:  In January 2000, we acquired  Ekono with 10 large  supermarkets  in
Buenos Aires.                                                         

o    La Fragua:  In December  1999,  we  established a 50/50  partnership,  Paiz
     Ahold,  which  controls an 80.5%  interest in La Fragua,  the largest  food
     retailer in Guatemala. We completed this agreement in December 1999 and, as
     a result,  the assets and  liabilities  of La Fragua are  reflected  in our
     consolidated  balance  sheet  at the end of  fiscal  1999  but  none of the
     operating  results are included in our  consolidated  statement of earnings
for fiscal 1999.                                                      

o    Supamer and Gonzalez: In May 1999, through our 50/50 partnership with Velox
     Retail Holdings, Disco Ahold International Holdings acquired 75 stores from
Supamer and Gonzalez.                                                 

o    Gastronoom:  In July 1999, we acquired  Gastronoom,  a Dutch  institutional
     food supplier, for EUR 152 million including interest-bearing debt. In July
     1999, Gastronoom was combined with our existing food service company in The
Netherlands, Grootverbruik Ahold to form Deli XL.                     

o    Dialco, Dumaya, Guerrero and Castillo del Barrio: Throughout 1999, in Spain
     we acquired several companies for an aggregate amount of EUR 118 million in
cash.                                                                 

o    Giant-Landover: In October 1998, we acquired Giant Food, which operated 179
     supermarkets  in the  Mid-Atlantic  region of the United  States,  for $2.7
billion in cash.                                                      

o    Disco and Santa  Isabel:  In  January  1998,  we  established  Disco  Ahold
     International  Holdings, or DAIH, a 50% owned partnership with Velox Retail
     Holdings.  DAIH  currently  controls  a  99.3%  stake  in  Disco.  We  paid
approximately $538 million to acquire our interest in DAIH.           

Segment information                                                             

Selected segment information is as follows:                                     

                                                                [Download Table]

                                 Fiscal Year             
                        2000         1999          1998  
                            (in millions of EUR)         
                                                         
Net Sales                                                
Retail trade           44,653        32,966       26,080 
Food service            7,754           553          365 
Real estate and other      64            41           39 
                        -----        ------       ------ 
                        52,471       33,560       26,484 
                        ======       ======       ====== 
Operating Results                                        
Retail trade             1,845        1,364          925 
Food service               294           15            8 
Real estate and other      181           80          124 
Corporate costs            (46)         (44)         (40)
                         -----        -----        ----- 
                         2,274        1,415        1,017 
                         =====        =====        ===== 

                                                        [Enlarge/Download Table]

                                                      December 31,    January 2,    January 3, 
                                                          2000          2000          1999     
                                                              (in millions of EUR)             
                                                                                               
Assets in use for operational activities *                                                     
Retail trade                                             17,915        12,175         9,519    
Food service                                              3,965           169            81    
Real estate and other                                     2,642         1,876         1,576    
Intersegment                                               (275)         (398)         (209)   
                                                         ------        ------        ------    
                                                         24,247        13,822        10,967    
                                                         ======        ======        ======    

---------------                                                                                
*    Assets in use for  operational  activities  are all  assets of a  segment,  less the loans
     receivable, investment in subsidiaries and deferred income taxes.                         

More segment  information can be found in note 19 to the consolidated  financial
statements  included elsewhere in this annual report.  Please see the discussion
elsewhere in this item for an explanation of the  information  presented in this
section of the document.                                                        

Operating Results                                                               

Selected earnings data are as follows:                                          

                                                        [Enlarge/Download Table]


                                                                              Fiscal Year                              
                                                              2000                 1999                     1998       
                                                         EUR        % of      EUR        % of           EUR      % of  
                                                                    sales                sales                   sales 
                                                                   (in millions, except per common share data)         
                                                                                                                       
Net sales                                               52,471      100.0    33,560      100.0       26,484      100.0 
Gross profit                                            11,887       22.6     8,354       24.9        6,189       23.4 
Operating expenses                                      (9,613)     (18.3)   (6,939)     (20.7)      (5,172)     (19.6)
Operating results                                        2,274        4.3     1,415        4.2        1,017        3.8 
Net financial expense                                     (669)      (1.3)     (366)      (1.1)        (245)      (0.9)
Income taxes                                              (401)      (0.7)     (283)      (0.8)        (197)      (0.7)
Income from unconsolidated subsidiaries and affiliates      14         --         7         --           11         -- 
Minority interests                                        (102)      (0.2)      (21)      (0.1)         (39)      (0.1)
Net earnings                                             1,116        2.1       752        2.2          547        2.1 
Net earnings per common share                             1.51                 1.14                    0.91            

Net Sales                                                                       

Net sales in fiscal 2000 increased by EUR 18,911 million,  or 56%, to EUR 52,471
million,   from  EUR  33,560  million  in  1999.  At  constant  exchange  rates,
consolidated  net sales  growth was 42% in fiscal 2000  compared to fiscal 1999.
The major  reasons for the  increase  in net sales were,  in addition to organic
growth, the acquisition of U.S.  Foodservice,  consolidated  starting April 2000
and  the  acquisition  of the 50%  partnership  interest  in  ICA,  consolidated
starting May 2000. The other acquisitions  mentioned  elsewhere in this document
also contributed to net sales growth.  Organic sales growth,  which excludes the
net sales from acquisitions  consolidated for less than four quarters,  for 2000
was 6.6%. Net sales in fiscal 1999  increased by EUR 7,076  million,  or 27%, to
EUR 33,560 million from EUR 26,484 million in fiscal 1998. At constant  exchange
rates, consolidated sales growth was 25% in fiscal 1999 compared to fiscal 1998.
The major  reasons for the  increase  in net sales were,  in addition to organic
growth, the full-year  consolidation of  Giant-Landover,  Disco and Santa Isabel
and the July 1999 acquisition of Gastronoom.  These increases were partly offset
by the additional  week in fiscal 1998 for our operations in The Netherlands and
the United States.                                                              

Net sales for fiscal 2000, 1999 and 1998 are as follows:                        

                                                        [Enlarge/Download Table]


                                                                           Fiscal Year                      
                                                      2000                   1999                 1998      
                                               Amount      Change      Amount    Change     Amount    Change
                                                          (EUR in millions, except percentages)             
                                                              %                    %                     %  
                                                                                                            
Retail trade                                                                                                
  United States                                                                                             
     Stop & Shop                               8,454         35      6,278        13        5,560       14  
     Giant-Carlisle                            3,223         --      3,227         5        3,074       10  
     BI-LO                                     3,726         32      2,823         9        2,597        3  
     Tops                                      3,052         19      2,554        --        2,559        2  
     Giant-Landover                            5,196         22      4,244       496          713        2  
     Peapod                                       52         --         --        --           --       --  
                                              ------                ------                 ------           
        Total United States                   23,703         24     19,126        32       14,503       15  
  Europe                                                                                                    
     Albert Heijn including franchise stores   5,310          4      5,127         1        5,073        6  
     Schuitema                                 2,136         17      1,832         6        1,726       10  
     The Netherlands other                       564          4        540         5          515        4  
     Sweden                                    2,999         --         --        --           --       --  
     Norway                                    1,424         --         --        --           --       --  
     Baltics                                      57         --         --        --           --       --  
     Portugal                                  1,467          9      1,341        12        1,202       12  
     Czech Republic                              598         32        455        39          326       51  
     Poland                                      393         78        221        37          162       64  
     Spain                                       518         48        351       644           47      (25) 
                                              ------                ------                 ------           
        Total Europe                          15,466         57      9,867         9        9,051        9  
  Latin America                                                                                             
     Bompreco                                  1,515         30      1,167      (27)        1,590       33  
     Disco                                     2,174         32      1,652       368          353       --  
     Santa Isabel                                764         13        678       293          173       --  
     La Fragua                                   629         --         --        --           --       --  
                                              ------                ------                 ------           
        Total Latin America                    5,082         45      3,497        65        2,116           
        Total Asia Pacific                       402        (16)       476        16          410       (3) 
Food service                                                                                                
  United States                                6,649         --         --        --           --       --  
  Europe                                       1,105        100        553        52          365        8  
Real estate and other                             64         55         41         4           39       16  
                                              ------                ------                 ------           
Net sales                                     52,471         56     33,560        27       26,484       15  
                                              ======                ======                 ======           

Retail Trade                                                                    
United States - Net sales in the United  States  increased by 24% in fiscal 2000
compared to fiscal 1999. This increase was caused by strong organic sales growth
as well as the consolidation of Golden Gallon, Sugar Creek and Peapod which were
acquired  during fiscal 2000. Net sales were higher at all operating  companies,
particularly  at Stop & Shop and  Giant-Landover.  During  2000,  the  "Edwards"
chain,  which previously  formed a part of Giant Carlisle,  was converted to the
Stop & Shop  brand,  except  for  the  four  stores  that  were  transferred  to
Giant-Landover.  Bonus card programs introduced  beginning in fiscal 1997, aimed
at generating and rewarding  customer  loyalty had a positive effect on the U.S.
stores,  as reflected in a 2.1%  increase in fiscal 2000 in identical  store net
sales as  compared  to a 2.0%  increase  in fiscal  1999 and a 1.6%  increase in
fiscal  1998.  Net sales in the United  States  increased  by 32% in fiscal 1999
compared to fiscal 1998. This substantial increase mainly reflects the full year
consolidation of Giant-Landover, which we acquired in October 1998, contributing
an additional  EUR 3,493  million to fiscal 1999 retail net sales.  Stop & Shop,
BI-LO and  Giant-Carlisle  generated  higher net sales in fiscal 1999, while net
sales in fiscal 1999 in dollars at Tops declined,  reflecting the sale of the 12
Vix pharmacy stores.                                                            

Europe - Net sales in Europe  increased  by 57% in 2000  compared  to 1999.  The
increase  particularly  reflects the consolidation of ICA effective May 1, 2000.
Net sales were higher in all countries.  In Portugal, the net sales increase was
attributable  to new store openings.  In the Czech Republic and Poland,  the net
sales increase was mainly  attributable to the opening of new  supermarkets  and
hypermarkets. In Spain the net sales increase was largely due to the acquisition
of the Kampio supermarket chain. In The Netherlands,  Albert Heijn and Schuitema
achieved  market sales  growth.  Net sales in fiscal 1999 were EUR 9,867 million
compared to EUR 9,051 in fiscal  1998,  representing  an annual  increase of 9%.
This increase  reflected the Spanish  supermarket chains acquired in fiscal 1999
as well as increased net sales in Portugal,  the Czech  Republic and Poland.  In
Portugal,  the  supermarkets  of Pingo Doce and the  hypermarkets  of Feira Nova
contributed to net sales growth,  with  additional  benefits from the opening of
new stores.  Net sales in the Czech  Republic were boosted by the  popularity of
the three Hypernova  hypermarkets and 19 Prima general  merchandise  stores. The
net sales increase in Poland in fiscal 1999 resulted from the  acquisition of 11
Centrum supermarkets and the opening of new stores.                             

Latin  America  - Net sales in Latin  America  increased  by 45% in fiscal  2000
compared  to  fiscal  1999.   This  increase   partly  reflects  the  full  year
consolidation  of La Fragua in Guatemala.  All operating  companies  contributed
substantially  to the sales  growth.  Net sales in Latin  America in fiscal 1999
increased by 65%,  primarily  due to the full year  inclusion of Disco and Santa
Isabel in fiscal 1999. In local currency,  net sales at all chains  increased in
fiscal 1999. However, due to the devaluation of the Brazilian Real, net sales in
fiscal 1999 in Brazil  decreased by  approximately  EUR 500 million  compared to
fiscal 1998.                                                                    

Asia  Pacific  - Net  sales in Asia  Pacific  decreased  by 16% in  fiscal  2000
compared to fiscal  1999,  reflecting  the sale of store  chains in Shanghai and
Singapore in the fourth  quarter of fiscal 1999.  Despite the  divestment of our
interests in China and Singapore,  net sales in Asia Pacific increased by 16% in
fiscal 1999 compared to fiscal 1998. This increase was primarily attributable to
the full-year  consolidation of 27 Malaysian stores, which we acquired in fiscal
1998.  Net sales  increased  in Thailand in fiscal  1999,  despite the  currency
crisis and the 11% devaluation of the Thai Baht.                                

Food Service                                                                    
Net sales  from food  service  increased  by EUR 7,201  million  in fiscal  2000
compared to fiscal  1999 and EUR 188  million in fiscal 1999  compared to fiscal
1998.  The  increase  in  fiscal  2000  was  due  to  the  acquisition  of  U.S.
Foodservice.  The consolidation of Menyforetagen as part of ICA also contributed
to the increase. The increase in fiscal 1999 was attributable to our acquisition
of Gastronoom,  later renamed to Deli XL, which we consolidated  starting in the
second half of fiscal  1999,  as well as to  increased  net sales to  affiliated
customers.                                                                      

Net sales from food supply through Deli XL were approximately EUR 761 million in
fiscal 2000, EUR 550 million in fiscal 1999 and EUR 360 million in fiscal 1998. 

Real estate and other                                                           
Our other activities  consist primarily of revenues from real estate operations.
Net sales in this category consist of rent revenue generated from third parties,
including franchisees and sales to third parties from our production company and
services  rendered to our associated  stores in Scandinavia.  As a percentage of
total net sales, these revenues are insignificant.                              

Gross Profit                                                                    

Gross  profit in  fiscal  2000 was EUR  11,887  million,  compared  to EUR 8,354
million in fiscal 1999 and EUR 6,189  million in fiscal  1998.  The  increase in
fiscal  2000  was  due  to  an  increase  in  net  sales  as  a  result  of  the
aforementioned  acquisitions which were partly offset by a lower gross margin as
a percentage of net sales, as explained  below.  The increases in fiscal 1999 as
compared  to fiscal  1998 was due to both  increases  in net  sales  and  margin
improvements.  The growth in  absolute  amounts  was  fueled by the fiscal  1999
acquisition  of  Gastronoom,   the  acquisitions  in  Spain  and  the  full-year
consolidation of the fiscal 1998 acquisitions of Giant-Landover, Disco and Santa
Isabel. In addition, fiscal 2000, fiscal 1999 and fiscal 1998 gross profits were
positively  affected  by a stronger  dollar  relative  to the euro and the Dutch
guilder.                                                                        

Gross margin as a percentage of net sales was 22.6% in fiscal 2000,  compared to
24.9% in fiscal 1999 and 23.4% in fiscal  1998.  The decrease in fiscal 2000 was
due to  acquisitions  in the food service  segment  which  typically  have lower
margins. Our acquisition of the 50% partnership interest in ICA also contributed
to our lower gross margin,  since its net sales largely consists of lower-margin
sales to the associated stores and franchise stores. Despite strong competition,
gross margin as a percentage of net sales increased by 1.2 percentage  points in
fiscal 1999.  These  increases were primarily due to the growth in higher margin
operations in the United States,  including the addition of  Giant-Landover  and
growth in  Portugal.  We expect  gross  margins  to  continue  to improve as the
operations  in the  United  States  become  more  integrated  and  supply  chain
improvements are implemented and realized.                                      

Operating Expenses                                                              

Operating expenses,  consisting of selling, general and administrative expenses,
were EUR 9,613  million in fiscal 2000,  compared to EUR 6,939 million in fiscal
1999 and EUR 5,172 million in fiscal 1998. These expenses as a percentage of net
sales were 18.3% in fiscal  2000  compared  to 20.7% in fiscal 1999 and 19.5% in
fiscal 1998. The decrease in operating  expenses as a percentage of net sales in
fiscal  2000 was due to the  aforementioned  acquisitions  in the  food  service
segment and the acquisition of a 50% partnership  interest in ICA. Both the food
service  companies  and ICA have a  different  cost  structure  with lower gross
profit  margins and lower  operating  expenses  as a  percentage  of sales.  The
increase in operating  expenses as a percentage  of net sales in fiscal 1999 was
due to  slightly  higher  store  wages and other  store  expenses  in almost all
operating companies as a result of increased service levels.                    

Selling  expenses  were EUR 7,905  million in fiscal 2000,  EUR 5,806 million in
fiscal  1999 and EUR  4,413  million  in  fiscal  1998.  Selling  expenses  as a
percentage  of net sales were 15.1% in fiscal 2000,  compared to 17.3% in fiscal
1999 and 16.7% in fiscal 1998. The decrease in selling  expenses as a percentage
of net sales in fiscal 2000 was due to the  aforementioned  acquisitions  in the
food service segment and the acquisition of the 50% partnership interest in ICA.
The increase in selling expenses as a percentage of net sales in fiscal 1999 was
attributable to the increase in store wages and other store expenses as a result
of increased service levels mentioned above.                                    

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General and  administrative  expenses were EUR 1,708 million in fiscal 2000, EUR
1,133  million in fiscal  1999 and EUR 759 million in fiscal  1998.  General and
administrative  expenses as a percentage  of net sales were 3.3% in fiscal 2000,
compared to 3.4% in fiscal 1999 and 2.9% in fiscal 1998. The increase in general
and  administrative  expenses in fiscal 2000 was due to the  inclusion  of newly
acquired  and   consolidated   companies  as   described   above.   General  and
administrative  expenses in fiscal  1999  increased  in absolute  terms and as a
percentage of net sales due to the inclusion of newly acquired and  consolidated
companies.  Particularly,  Giant-Landover,  has had higher levels of general and
administrative costs than our other operating units. We also incurred additional
costs  associated  with creating and staffing our new  corporate  offices in the
United States. Additionally,  information system costs increased, representing a
continued investment in systems at all operating companies.                     

Operating Results                                                               

Operating results for fiscal 2000, 1999 and 1998 are as follows:                

                                                                [Download Table]


                                       Fiscal Year                           

                       2000                  1999                 1998       

                 Amount     Change     Amount    Change      Amount    Change

                          (EUR in millions, except percentages)              
                                %                    %                     % 
                                                                             
United States     1,466        55         944       48          639       26 
Europe              670        46         459       14          402       13 
Latin America       204       110          97       54           63       72 
Asia Pacific        (20)       51         (41)      13          (47)     (31)
Corporate Staff     (46)       (4)        (44)     (10)         (40)     (23)
                   ----                 -----                 ----           
Total             2,274        61       1,415       39        1,017       22 
                  =====                 =====                 =====          

Operating results were EUR 2,274 million in fiscal 2000, an increase of 61% over
fiscal 1999.  Operating results were 4.3% of net sales in fiscal 2000,  compared
to 4.2% in fiscal 1999. The increase in operating  results was mainly due to the
new consolidated  acquisitions  during fiscal 2000 but also caused by the strong
organic growth of 13.6% of existing  operations.  Operating  results improved in
fiscal  2000 as compared to fiscal  1999 in all areas  except for  Portugal  and
Poland.                                                                         

United States operating  results rose 55% from EUR 944 million in fiscal 1999 to
EUR 1,466 million in fiscal 2000. United States operating results in U.S. dollar
rose by 34% from $1,001 million in fiscal 1999 to $1,342 million in fiscal 2000,
partially reflecting the consolidation of U.S.  Foodservice.  Excluding Edwards,
all supermarket  chains showed market share gains,  improved  operating margins,
significant synergy benefits and ongoing cost control. During the second half of
the year,  64 Edwards  stores were  converted to the Stop & Shop format and four
stores were transferred to Giant-Landover. Approximately $30 million was charged
to  operating  results for this  conversion.  The  operating  losses of internet
grocer Peapod amounted to $32 million.                                          

Operating  results in Europe rose 46% to EUR 670 million in fiscal 2000,  partly
reflecting the consolidation of ICA.  Operating results in The Netherlands,  the
Czech Republic and Spain also contributed to this increase. Operating results in
Portugal  were  lower  than  last  year,   partially  reflecting  the  costs  of
implementation of a new logistics  system.  The operating loss in Poland was due
to the high cost of opening a large number of new stores.                       

Operating  results  in Latin  America  increased  by 110% to EUR 204  million in
fiscal  2000,   partly   attributable  to  the   consolidation   of  La  Fragua.
Substantially higher operating results at Bompreco and Disco also contributed to
the rise.  Operating  results  at Santa  Isabel  were  positive  for the  fourth
quarter, although a slight loss was recorded for the year as a whole.           

Operating  losses for Asia  Pacific  amounted to EUR 20 million in fiscal  2000,
compared to EUR 41 million in fiscal 1999. In Thailand, operating results turned
positive in fiscal  2000,  while  Malaysia  and  Indonesia  sustained  operating
losses.                                                                         

Operating  results were EUR 1,415  million in fiscal 1999,  an increase of 39.1%
over fiscal  1998.  Operating  earnings  were 4.2% of net sales in fiscal  1999,
compared to 3.8% in fiscal 1998.  Operating  results  improved in fiscal 1999 as
compared to fiscal 1998 in all geographic areas except for Poland,  where losses
resulted from continued  investment in infrastructure  and development of market
share.                                                                          

Exchange  rate  fluctuations,  particularly  of the dollar  against  the euro in
fiscal 2000 and fiscal 1999 had a net positive  effect on  operating  results of
EUR 219  million in fiscal 2000 and EUR 30 million in fiscal  1999.  At constant
rates of exchange,  operating  results  would have  increased 45% in fiscal 2000
compared to fiscal 1999 and 36% in fiscal 1999 compared to fiscal 1998.         

Net Financial Expense                                                           

Interest expense increased in fiscal 2000 to EUR 809 million compared to EUR 421
million in fiscal  1999 and EUR 319  million in fiscal  1998.  The  increase  in
fiscal 2000 is due to the  consolidation of interest expenses related to the 50%
partnership  interest in ICA and the acquisition of U.S.  Foodservice as well as
the higher U.S.  dollar  exchange  rate and the issuance of notes during  fiscal
2000 as discussed below under - "Financing  Activities".  The increase in fiscal
1999 compared to fiscal 1998 was primarily due to the September 1998 issuance of
3% subordinated  convertible  notes due 2003 and the  consolidation  of interest
expenses  of  Disco  and  Santa  Isabel  in  the  fourth  quarter  of  1998  and
Giant-Landover  effective October 28, 1998. The increase in 1999 was also due to
the April 1999  issuance  of $1  billion  aggregate  principal  amount of senior
notes.  For more details on our  financing  activities,  please see - "Financing
Activities" below.                                                              

The  interest  coverage  ratio,  defined  as  operating  results  divided by net
interest  expense,  was 3.2 in fiscal 2000, 3.9 in fiscal 1999 and 4.2 in fiscal
1998. Net financial  expense is expected to increase in fiscal 2001,  reflecting
the first full year of additional  borrowings for the acquisitions  completed in
fiscal 2000.                                                                    

Income from  unconsolidated  companies was EUR 15 million in fiscal 2000,  EUR 7
million  in fiscal  1999 and EUR 11  million  in fiscal  1998.  Of the amount in
fiscal  2000,  a total of EUR 11 million  consisted  of  earnings  from  Statoil
Retail.  Statoil  Retail is the  non-consolidated  joint-venture  of ICA. Of the
amount in fiscal 1999, a total of EUR 4 million  consisted of earnings  from our
investment in Singapore, which was deconsolidated when we decided to divest this
investment. Of the amount in fiscal 1998, EUR 6 million related to earnings from
the acquisitions in Argentina and Chile,  which we did not consolidate until the
fourth quarter of fiscal 1998.                                                  

Income Taxes                                                                    

Our effective income tax rate was 25.0% in fiscal 2000, 27.0% in fiscal 1999 and
25.5% in fiscal  1998.  The  decrease in the tax rate for fiscal 2000 was due to
changes in the  composition  of the  earnings  before  taxes  among the  various
countries in which we operate,  which  countries  have  different tax rates.  In
fiscal 1999,  operations in countries with higher  effective tax rates,  such as
Giant-Landover  in  the  United  States,  contributed  higher  pre-tax  earnings
relative to countries with lower effective tax rates.                           

Net Earnings                                                                    

Net earnings in fiscal 2000 were EUR 1,116 million,  representing an increase of
48%  compared to fiscal  1999.  Net earnings per common share rose 32% in fiscal
2000 to EUR 1.51.  At constant  exchange  rates,  net earnings  increased 36% in
fiscal 2000 compared to fiscal 1999, resulting in a 19% increase in earnings per
share. Net earnings in fiscal 1999 were 752 million, representing a 37% increase
over fiscal 1998,  resulting in an 25% increase in net earnings per common share
to EUR 1.15.                                                                    

Net earnings  available to common  shareholders as determined in accordance with
U.S.  GAAP would have been EUR 794 million in fiscal  2000,  compared to EUR 573
million  in fiscal  1999 and EUR 388  million  in  fiscal  1998.  The  principal
differences  between Dutch GAAP and U.S. GAAP affecting net earnings include the
accounting  treatment  of  pensions,   provisions  and  goodwill.   For  further
information,  see note 23 to the  consolidated  financial  statements,  included
elsewhere in this annual report.                                                

Liquidity and Capital Resources                                                 

Cash Flow and Liquidity                                                         
Cash flow generated  from  operations  provides us with a significant  source of
liquidity.  Our operating  activities generated net cash of EUR 2,700 million in
fiscal 2000,  EUR 1,730  million in fiscal 1999 and EUR 1,258  million in fiscal
1998.  Cash flow from  operations is reinvested  each year in new stores,  store
remodeling  and  store  expansions,  as  well as in  store  efficiency-improving
measures and retailing innovations.                                             

Cash and cash  equivalents  as of the end of fiscal  years  2000,  1999 and 1998
totaled EUR 1,336  million,  EUR 888 million and EUR 519 million,  respectively.
The ratio of current assets to current liabilities was 86.7%, 87.7% and 90.7% at
year end 2000,  1999 and 1998,  respectively.  As of the end of fiscal 2000,  we
held  approximately  31 days of inventory,  compared to 32 days as of the end of
fiscal 1999 and 30 days as of the end of fiscal 1998.                           

Our primary  line of credit,  entered  into in December  1996,  is a $1 billion,
seven-year multi-currency revolving credit facility, under which, as of December
31, 2000, $233 million was available for additional  borrowings.  In March 1998,
we entered into an additional  $500 million,  four-year  standby  multi-currency
revolving  credit  facility.  The  terms and  conditions  of this  facility  are
substantially similar to the existing $1 billion multi-currency revolving credit
facility.  As of December 31, 2000,  the full amount was  outstanding  under the
$500  million,  four-year  credit  facility.  These  facilities  are intended to
provide  us with  sufficient  financial  capacity,  and we  believe  that  these
facilities  represent a sufficient source of working capital  sufficient to meet
our future  short-term and long-term  financing of our ongoing  operations.  The
borrowings  under our revolving  credit  agreements  bore interest at an average
rate per annum of 6.3% per U.S. dollar  borrowings as of the end of fiscal 2000.
For cash management  purposes,  local companies have committed credit lines, the
most important of which are the credit lines in the United States  totaling $150
million.                                                                        

Investing Activities and Capital Expenditures                                   
Amounts that we incurred for capital expenditures and acquisitions of businesses
were as follows:                                                                

                                   Fiscal Year
                                      2000      1999      1998

                                      (EUR millions)
Purchases of tangible fixed assets             2,469     1,733    1,320         
Acquisitions of businesses                     9,074       700    3,069         
Fixed assets disposals and other                (201)     (122)    (108)        
                                     ------     -----    -----
Net cash used in investing activities         11,342     2,311    4,281         
                                     ======     =====    =====
Capitalized lease commitments incurred           237       181      131         

In fiscal 2000,  capital  expenditures  were EUR 2,469  million  compared to EUR
1,733  million in fiscal 1999.  Of the amount  expended in fiscal years 2000 and
1999,  approximately 75% and 71%, respectively,  was incurred for new stores and
store improvements,  while the remainder was incurred for distribution  centers,
computer hardware and other assets.                                             

We expect our  investments in tangible fixed assets to total  approximately  EUR
3,090  million  in fiscal  2001,  of which  approximately  EUR 300  million  was
committed as of the end of fiscal 2000.  The  following  shows the  breakdown of
expected fiscal 2001 tangible fixed assets expenditures by geographic location: 

o EUR 1,710 million in the United States;                                       
o EUR 1,020 million in Europe;                                                  
o EUR 340 million in Latin America; and                                         
o EUR 20 million in Asia Pacific.                                               

We expect that new capitalized  lease commitments in the United States in fiscal
2001 will total approximately EUR 240 million.                                  

Acquisitions in fiscal 2000, totaling EUR 9,074 million,  consisted primarily of
U.S.  Foodservice,   our  50%  partnership  interest  in  ICA,  PYA/Monarch  and
Superdiplo. See - "Acquisitions and Consolidations" above.                      

We invested EUR 700 million in fiscal 1999 on  acquisitions  of  businesses  and
partnership interests, including the partnership in Guatemala, Gastronoom in The
Netherlands,  the acquisition through Disco of Supamer and Gonzalez in Argentina
and the  acquisition  of several chains in Spain.  Acquisitions  in fiscal 1998,
totaling  EUR 3,069  million,  consisted  primarily of  Giant-Landover,  and the
partnership interest in DAIH.                                                   

For a discussion of the financing of the fiscal 2000  acquisitions  please see -
"Financing Activities" below.                                                   

Financing Activities                                                            
Cash provided by financing  activities was EUR 8,716 million in fiscal 2000, EUR
866 million in fiscal 1999 and EUR 3,317 million in fiscal 1998.                

In May 2000, we completed a global  offering of common shares and an issue of 4%
convertible  subordinated notes due 2005. We issued 106,950,000 common shares at
an offering price of EUR 26.00,  raising net proceeds of  approximately  EUR 2.7
billion.  We also raised  approximately  EUR 0.9 billion through the issuance of
the convertible subordinated notes. We used the total net proceeds of the global
offering, amounting to approximately EUR 3.6 billion, to partly repay borrowings
under  a  EUR  4.4  billion  multi-currency  stand-by  bridge  revolving  credit
facility, which were used to finance in part our acquisition of U.S. Foodservice
and  a  50%  partnership  interest  in  ICA.  We  repaid  the  remaining  amount
outstanding  under this bridge  facility with the net proceeds from the issuance
in June 2000 of EUR 1.5 billion  6.375% bonds due 2005 by Ahold Finance  U.S.A.,
Inc. Ahold Finance U.S.A., Inc. is our 100% owned finance subsidiary and we have
fully and unconditionally guaranteed the notes.                                 

At the end of June 2000,  we acquired from  shareholders  of Bompreco 50% of the
remaining  Bompreco voting share capital partly in exchange for 5,301,201 of our
common shares valued at EUR 30.06 per share.                                    

In July 2000,  Ahold  Finance  U.S.A.,  Inc.  issued in a public  offering  $700
million aggregate principal amount of 8 1/4% notes due 2010, which are fully and
unconditionally  guaranteed  by us, and the net proceeds  were used to refinance
the debt of U.S. Foodservice and to pay down short term facilities.             

In September  2000, we issued CZK 3,000 million  floating rate notes due 2005 in
the Czech Republic. The proceeds were used to repay short term facilities in the
Czech Republic.                                                                 

In October 2000, we issued  115,317,164  cumulative  preferred  financing shares
with a par value of EUR 0.25 per share at an issue price of EUR 3.50,  resulting
in aggregate proceeds of approximately EUR 404 million.  We used the proceeds of
the issuance for general corporate purposes in The Netherlands.                 

In December 2000, we financed the acquisition of PYA/Monarch  through borrowings
under short-term  facilities and short term EMTN issues under a Euro Medium Term
Note program, which we planned to refinance in first half of fiscal 2001.       

Share  capital  was  increased  by  approximately  EUR 1.3 billion at the end of
fiscal 2000 in connection  with the  acquisition of Superdiplo  S.A.,  completed
early January  2001. A total of 36,849,875  shares were issued at a price of EUR
34.36 per share.                                                                

Financing  activities  in fiscal  1999  consisted  primarily  of net  additional
long-term and short-term  debt  borrowings  totaling EUR 555 million.  These net
borrowings  include  the  proceeds  from the $1.0  billion  aggregate  principal
proceeds of senior notes that Ahold Finance U.S.A.,  Inc issued in April 1999 to
repay the outstanding  borrowings under the credit facilities.  The senior notes
are  guaranteed  by Royal  Ahold  and  consist  of two  tranches,  $500  million
principal  amount of 6.25% due in May 2009 and $500 million  principal amount of
6.875%  due in May  2029.  Additionally,  capital  contributions  from  minority
interest shareholders  provided additional financing totaling  approximately EUR
326 million and,  proceeds  from the exercise of stock  options  provided EUR 21
million.   Dividend  payments,   including  dividends  on  cumulative  preferred
financing shares, totaled EUR 46 million.                                       

Cash  provided by financing  activities  in fiscal 1998  consisted  primarily of
proceeds from the global  offerings.  In April 1998 we issued  34,500,000 of our
common shares, resulting in total net proceeds of approximately EUR 998 million.
We used the proceeds primarily to repay debt incurred to finance the acquisition
of our 50%  participation  in  DAIH.  In  August  1998,  we  issued  24  million
cumulative  preferred  financing  shares  resulting  in  aggregate  proceeds  of
approximately  EUR 73 million.  In September  and October  1998,  to finance the
acquisition of Giant-Landover,  we issued 51,750,000 common shares, resulting in
net proceeds of approximately  EUR 1,184 million,  and EUR 678 million aggregate
principal amount of 3% subordinated  convertible  notes due 2003.  Additionally,
net  increases in  long-term  and  short-term  debt  borrowings  totaled EUR 288
million,  capital  contributions  from minority interest  shareholders  provided
additional  financing totaling  approximately EUR 78 million,  and proceeds from
the  exercise  of stock  options  provided  EUR 36 million.  Dividend  payments,
including  dividends on cumulative  preferred  financing shares,  totaled EUR 25
million.                                                                        

We have hedged  certain risks related to  fluctuations  of interest rates on our
dollar   outstanding   debt  through  the  purchase  of   derivative   financial
instruments.  We have also used  derivatives to convert  exposures from loans to
local   currencies.   Our   policy   is   to   hedge   only   interest-rate   or
foreign-exchange-transaction  exposure  that are  clearly  identifiable  and, in
principle, not to hedge foreign exchange translation exposure.                  

As of  fiscal  2000  we had  numerous  insignificant  foreign  exchange  forward
contracts  outstanding,  which  are used to hedge  future  payments  in  foreign
currencies to suppliers by operating  companies.  To hedge exposures  related to
loans and leases in foreign  currencies we had 29 swaps and cross currency swaps
outstanding  as of the end of  fiscal  2000.  Of  those 29  contracts,  19 had a
maturity of shorter than one year,  and ten had  maturities  ranging from two to
five years. Also, of those 29 contracts, 16 hedge USD/BRL exposure,  seven hedge
USD/EUR exposure,  three hedge SEK/NOR  exposure,  and in total three derivative
contracts are used to hedge THB/EUR, CZK/EUR and DKK/SEK exposure. As of the end
of fiscal 2000, we had nine interest rate derivatives  outstanding maturing from
2001 to 2004.  We believe  that our  hedging  practices  do not expose us to any
unusual  risks or  significant  exposure  to  potential  liabilities  from these
transactions.  For details  regarding  the  notional  amounts and values of such
derivative  financial  agreements,  see  note 21 to the  consolidated  financial
statements, included elsewhere in this annual report.                           

Interest-bearing  debt, including capitalized lease commitments,  was EUR 10,940
million at the end of fiscal 2000  compared  to EUR 4,874  million at the end of
fiscal 1999 and EUR 4,082  million at the end of 1998.  The ratio of average net
interest  bearing debt over earnings before  interest,  taxes,  depreciation and
amortization  (EBITDA) was 2.42, 2.00 and 1.42 for fiscal 2000,  fiscal 1999 and
fiscal 1998, respectively.                                                      

Shareholders'  equity was EUR 2,503  million,  EUR 2,352  million  and EUR 1,724
million at year end 2000, 1999 and 1998, respectively.  Group equity, defined as
shareholders' equity and minority interest in shareholders' equity,  represented
12% of total assets at the end of 2000 compared to 19% at the end of fiscal 1999
and 17% at the end of fiscal 1998.                                              

Shareholders' equity determined in accordance with U.S. GAAP would have been EUR
13,571 million at fiscal year end 2000,  compared to EUR 8,106 million at fiscal
year end 1999 and EUR 6,652  million  at fiscal  year end  1998.  The  principal
differences between Dutch GAAP and U.S. GAAP affecting  shareholders' equity are
the accounting  treatment of goodwill,  pensions and provisions.  See note 23 to
the consolidated financial statements, included elsewhere in this annual report.

Recent Developments                                                             

In January 2001,  Superdiplo signed an agreement to acquire Cemetro,  a chain of
24 supermarkets in the Canary Islands with annualized sales of approximately EUR
45  million.  The  acquisition  of Cemetro is  currently  subject to  regulatory
approval.  For further information  relating to Superdiplo,  please see Item 4 -
"Information on the Company".                                                   

In February 2001, we entered into separate leverage lease transactions  relating
to the purchase of interests in 46 commercial  properties in the United  States.
In these transactions,  certain of our U.S. subsidiaries sold their interests in
the properties to separate  limited  liability  companies formed by unaffiliated
equity  participants.  The purchasers  then leased the properties to Ahold Lease
U.S.A.,  Inc.,  our  indirect  wholly-owned  subsidiary,   which  subleased  the
properties to the relevant U.S.  operating  companies.  We have guaranteed Ahold
Lease U.S.A.,  Inc.'s,  payment and  performance  obligations  under each of the
leases. In connection with each property, the relevant purchaser issued notes to
two pass through  trusts which in turn issued pass  through  certificates  in an
offering exempt from registration under the U.S. Securities Act of 1933 pursuant
to Rule  144A  thereunder.  The pass  through  certificates  were  issued in two
series:  $313,665,000  fully  accreted  principal  amount of 7.82% pass  through
certificates with a final  distribution date of January 2, 2020 and $250,720,000
fully accreted principal amount of 8.62% pass through  certificates with a final
distribution date of January 2, 2025.  Payments on the notes, and hence the pass
through  certificates,  will come from the rent  payments  due from Ahold  Lease
under the leases.  Proceeds  from the issuance of the pass through  certificates
were used to finance the purchase price of the notes, which in turn were used by
the  purchasers to finance a portion of the purchase price of the 46 properties.
We obtained off balance  sheet  treatment for the debt included in the leveraged
lease transactions and we received gross proceeds of approximately $638 million,
which were used to repay indebtedness  under our revolving credit agreements,  a
portion of which was incurred in connection with our acquisitions of PYA/Monarch
and of certain commercial real estate properties in the United States.          

In February 2001,  two of our U.S.  operating  companies,  Tops and Stop & Shop,
signed  an  agreement  to  acquire  56  supermarkets  and eight  sites  from C&S
Wholesale  Distributors,  which acquired the locations from Grand Union.  Stop &
Shop is in the  process of  integrating  36 stores and the eight sites with Tops
integrating the remaining 20 stores. We will take an unusual charge of about $50
million  to cover the costs of store  conversions.  The total  transaction  size
amounted to  approximately  $178  million and is expected to  positively  impact
earnings per share as of 2002.                                                  

In February 2001, U.S.  Foodservice  acquired Parkway Food Service,  a broadline
food  service  distributor  in  western  Florida.   Parkway  reported  sales  of
approximately   $85  million  for  its  fiscal  2000  and  is  headquartered  in
Clearwater,  Florida. Parkway services over 1,000 accounts,  mostly restaurants,
schools, universities and health care institutions. Parkway will be consolidated
as of the first quarter 2001.                                                   

In March  2001,  U.S.  Foodservice  signed a letter of intent to acquire  Mutual
Distributors,  Inc., a broadline  food  service  distributor  in Florida,  which
reported  annual sales of  approximately  $300 million for its fiscal year 2000.
Mutual,  a privately held company,  is  headquartered  in Lakeland,  Florida and
services over 4,200 accounts, which include restaurants,  schools,  universities
and health care institutions.                                                   

In March  2001,  we  announced  that we have signed a letter of intent to divest
Jamin, our confectionery chain, because with 2000 net sales of approximately EUR
36 million,  the scale of its operations no longer was consistent  with our core
activities.                                                                     

In March 2001,  we announced  that we had signed a letter of intent to sell four
of Marvelo's product groups to third parties.                                   

In March 2001, Royal Ahold,  which owns all of the voting shares of Bompreco and
61.2% of the non-voting shares of Bompreco, announced that it planned to buy the
remaining non-voting shares of Bompreco.                                        

On April 9, 2001, we announced a proposal for two new Supervisory  Board members
and two Executive Board members.  These  appointments  will be effective as from
September  1,  2001,  conditionally  upon  the  amendment  to  the  Articles  of
Association  which is to be submitted to the General  Meeting of Shareholders on
May 15,  2001.  For more  information  on  these  proposals,  please  see Item 6
"Directors, Senior Management and Employees-Supervisory Board."                 

Strategic Outlook                                                               

We expect  that net sales and  operating  results  in fiscal  2001,  which  will
consist of 52 weeks,  will improve in all regions.  We also  anticipate that our
acquisition  strategy  in fiscal  2001 will be less robust as compared to fiscal
2000. Based on our current  business plan, and barring any unforeseen  events or
economic  changes,  our overall financial target is to increase net earnings per
share by 15% in 2001  (excluding  currency  impact,  unusual  items and goodwill
amortization),  while  improving our return on invested  capital of our existing
business. Realization of our earnings targets, of course, is dependent upon many
factors and we cannot assure you that we will be able to realize this growth.   

We expect that our retail  subsidiaries  will continue to generate organic sales
growth,  driven by investments in square footage and  improvements  in sales per
square  foot.  Flexible,   innovative  solutions  in  the  areas  of  home  meal
replacement,  internet-based  delivery  services  and  value-added  services are
anticipated  to contribute to top line growth.  The  development of loyalty card
programs  throughout our retail network will continue to aid us in tailoring our
assortment to meet local  customers'  needs.  Additionally,  we anticipate  that
developments  in  the  area  of  category  management,  micro-merchandising  and
expansion of specialty and non-food assortment will contribute to both growth in
net sales and margin improvements.                                              

In the United States, we expect a 7% increase in square footage to contribute to
organic sales growth in our retail channel. Cooperation between our food service
and retail divisions will increasingly enhance our ability to offer a variety of
mealtime  solutions to our customers.  The synergies  gained from combining U.S.
Foodservice with PYA/Monarch are expected to lead to margin  improvements in our
food service division.  Centralization  of corporate  functions among our retail
subsidiaries should also positively impact operating margins. Overall, increased
concentration  of our U.S.  business  will support us in ensuring the quality of
our supply chain.                                                               

In Europe,  growth in net sales and  operating  earnings in The  Netherlands  is
anticipated in all areas of activities.  Our focus in Poland will be to generate
net sales growth with an aim to break even within a two-year time frame. Planned
store openings,  primarily compact  hypermarkets,  will lead that growth. In the
Czech Republic,  our store opening  program,  including new  hypermarkets,  will
continue together with our announced plans to expand the business into Slovakia.
Following our acquisition of Superdiplo,  we have a solid platform from which we
will  continue to build and  consolidate  our  presence  in the  Spanish  retail
sector. In Scandinavia,  we anticipate continued improvements in our business at
both the top and bottom line. Specifically, the implementation of a new business
model in Sweden with regard to the associated store arrangements, is expected to
boost growth in sales to associated stores beginning in 2001.                   

In Central  America,  we will continue to explore  opportunities  to expand into
neighboring  countries through our local partnership,  Paiz Ahold, which holds a
majority  stake of La Fragua.  We intend to step up investment in our stores and
logistics in Brazil,  including our plans for a central  distribution  center in
Recife. With economic  difficulties in Argentina being forecasted to continue in
fiscal 2001,  we plan to continue  the  development  of our compact  hypermarket
formula, which is intended to offer customers a price competitive proposition.  

In fiscal 2001, the focus of our operations in Malaysia,  Thailand and Indonesia
will continue to center upon building a profitable business.                    

Throughout our network, we will prudently pursue opportunities to strengthen our
market  performance  and make  acquisitions  when and  where  applicable.  In an
on-going  effort to control  costs  within our  network,  we will  continue  our
continental  approach to providing  support services to our business,  including
accelerated   integration   of  our  European   business.   Our   multi-channel,
multi-format  strategy grants us the  flexibility to react to the  ever-changing
consumption patterns of our customers and will continue to be our strength going
forward.                                                                        

ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES                              

Supervisory Board                                                               

Our  Supervisory  Board  is  an  independent  and  self-electing   entity.   The
Supervisory  Board must consist of at least three  members.  As a member's  term
expires or as a member  retires,  the ongoing  members  vote on  replacement  or
re-appointment.  Supervisory  Board members are elected for a term of four years
and may be re-elected thereafter.  A member of the Supervisory Board must retire
upon  reaching  the age of 72.  Persons  employed by us or a  dependent  company
("afhankelijke maatschappij") cannot be members of the Supervisory Board.       

The  Supervisory  Board has the power to appoint  and  discharge  members of our
Corporate  Executive  Board, the right to approve certain  important  management
decisions,  and the power to adopt the annual financial  accounts.  In addition,
the  Supervisory  Board  supervises  the  policies  conducted  by the  Corporate
Executive  Board, as well as our general course of affairs and our business.  In
performing  their  duties,  members of the  Supervisory  Board must consider the
interests of Royal Ahold and its business.                                      

The General Meeting of Shareholders or a duly appointed  committee thereof,  the
Corporate  Executive Board and the Central Works Council, in its capacity as the
representative  of our  employees,  may make a  non-binding  recommendation  for
candidates to fill a vacancy on the Supervisory Board. In addition,  the General
Meeting of  Shareholders  and the Central Works Council have the right to object
to a proposed  appointment of a member of the Supervisory Board. The appointment
will take place if such objection is declared invalid by the Enterprise  Chamber
("Ondernemingskamer") of the Amsterdam Court of Appeal.                         

A member of the Supervisory Board may be dismissed by the Enterprise  Chamber of
the Amsterdam  Court of Appeal for neglect of duties,  for certain other serious
reasons or following a significant  change in circumstances as a result of which
continued membership is no longer reasonable.                                   

The  Supervisory  Board and the  Corporate  Executive  Board intend to present a
proposal to amend our Articles of  Association,  which would be submitted to the
General  Meeting of  Shareholders  of the Company to be held on May 15, 2001. If
the proposed amendments to the Articles of Association are adopted,  the members
of both  the  Corporate  Executive  Board  and the  Supervisory  Board  would be
appointed, suspended and dismissed by the General Meeting of Shareholders.  Such
appointment, however, will be subject to a binding nomination by the Supervisory
Board,  unless overruled by at least a two-thirds  majority of the votes cast in
the General Meeting of Shareholders. Such majority, however, must represent more
than half of the issued share capital.  The resolution of the General Meeting of
Shareholders  to suspend or dismiss a member of either the  Corporate  Executive
Board or the  Supervisory  Board is also subject to the  qualified  majority and
quorum requirements. The proposed amendments would eliminate the requirement for
the  Supervisory  Board to approve a number of important  resolutions.  However,
under the amended Articles of  Association,  the Supervisory  Board would retain
the right to approve  certain  resolutions  of the  Corporate  Executive  Board.
Futhermore,  the proposed amendments to the Articles of Association would enable
the  Supervisory  Board to provide the Corporate  Executive Board with a list of
the executive  resolutions  that would be subject to approval by the Supervisory
Board. The Articles of Association,  if amended, would no longer provide for the
possibility  of creating a  shareholders'  committee.  In addition,  the General
Meeting  of  Shareholders  would be given  the  authority  to adopt  the  annual
accounts at that meeting.                                                       

On April 9, 2001, we announced a proposal for two new Supervisory  Board members
and two Executive Board members.  These  appointments  will be effective as from
September  1,  2001,  conditionally  upon  the  amendment  to  the  Articles  of
Association  which is to be submitted to the General  Meeting of Shareholders on
May 15, 2001. For more information on these proposed amendments, please see this
Item 6 "Directors, Senior Management and Employees-Supervisory Board."          

In accordance with the provisions of article 21, sub 4 of the proposed  Articles
of Association,  the Supervisory Board anticipates  nominating Mr. R.G. Tobin at
the top of the binding  nominations for a member of the Supervisory Board on the
grounds  of  his  experience  and  merits.  The  particulars  of  the  nominated
candidates are as follows:                                                      

1.   Mr.  R.G.  Tobin,  age  62-Currently  a member  of the  Executive  Board of
Koninklijke Ahold N.V. and Chairman of Ahold USA, Inc.                
2.   Mr. R. Fahlin, age 62-Formerly the Chairman and President of ICA Ahold AB  

In accordance with the provisions of article 21, sub 4 of the proposed  Articles
of Association, the Supervisory Board anticipates nominating Mr. R.Fahlin at the
top of the  binding  nominations  for a member of the  Supervisory  Board on the
grounds  of  his  experience  and  merits.  The  particulars  of  the  nominated
candidates are as follows:                                                      

1.   Mr. R. Fahlin, age 62-Formerly the Chairman and President of ICA Ahold AB  
2.   Prof. M. van Olffen,  age  39-Currently  the Civil law notary in Amsterdam,
partner of De Brauw Blackstone Westbroek, N.V.                        

In accordance with the provisions of article 16, sub 4 of the proposed  Articles
of Association,  the Supervisory Board anticipates  nominating Mr. W.J. Grize at
the top of the binding  nominations  for a member of the Executive  Board on the
grounds  of  his  experience  and  merits.  The  particulars  of  the  nominated
candidates are as follows:                                                      

1.   Mr. W.J. Grize, age 54-Currently the President and CEO of Ahold USA, Inc   
2.   Mr. J. Miller, age 52-Currently the President and CEO of U.S.  Foodservice,
Inc.                                                                  

In accordance with the provisions of article 16, sub 4 of the proposed  Articles
of Association,  the Supervisory Board  anticipates  nominating Mr. J. Miller at
the top of the binding  nominations  for a member of the Executive  Board on the
grounds  of  his  experience  and  merits.  The  particulars  of  the  nominated
candidates are as follows                                                       

1.   Mr. J. Miller, age 52-Currently the President and CEO of U.S.  Foodservice,
Inc.                                                                  
2.   Prof. S.E.  Eisma,  age  52-Currently a lawyer in the Hague,  partner of De
Brauw Blackstone Westbroek, NV.                                       

As of March 30, 2001, the members of the Supervisory Board were as follows:     

                                                        [Enlarge/Download Table]


NAME               DATE OF BIRTH      BUSINESS EXPERIENCE AND ACTIVITIES                          
                                                                                                  
H. de Ruiter       March 3, 1934      Henny de Ruiter is a Dutch national.  He was first appointed
(Chairman)                            in 1994 and has been  reappointed  until 2002. Mr. De Ruiter
                                      is a former  Managing  Director  and  also a  member  of the
                                      Supervisory   Board   of  N.V.   Koninklijke   Nederlandsche
                                      Petroleum  Maatschappij.  In addition, he is a member of the
                                      Supervisory Boards of Aegon N.V., Beers N.V., Heineken N.V.,
                                      Corus Group PLC, Vopak N.V. and Wolters Kluwer N.V.         

R.J. Nelissen      April 4, 1931      Roelof  J.  Nelissen  is a  Dutch  national.  He  was  first
(Vice Chairman)                       appointed in 1981 and has been  reappointed  until 2001. Mr.
                                      Nelissen  is a  former  Chairman  of the  Board  of ABN AMRO
                                      Holding  N.V.  and ABN AMRO Bank N.V. He is also a member of
                                      the   Supervisory   Board  of  N.V.   Luchthaven   Schiphol,
                                      Koninklijke   Boskalis   Westminster  N.V.,   Schiphol  Area
                                      Development   Company,   Daimler  Chrysler  Nederland  B.V.,
                                      Elsevier N.V., Reed Elsevier PLC, ABN AMRO Holding N.V., ABN
                                      AMRO Bank N.V. and International  Flavors and Fragrances IFF
                                      (Nederland) BV.                                             

J.A. van Kemenade  June 3, 1937       Jos A.  van  Kemenade  is a  Dutch  national.  He was  first
                                      appointed  in 1996 and has been  reappointed  until the year
                                      2004. Mr. van Kemenade is the Queen's  Commissioner  for the
                                      Dutch province of North Holland.  He is also a member of the
                                      Supervisory Board of De Nederlandsche Bank N.V.             

C. Boonstra        January 7, 1938    Cor Boonstra is a Dutch national.  He was appointed in 2000.
                                      Mr.  Boonstra is a former  President of Sara Lee/DE and Sara
                                      Lee Corporation in the United States. He is the President of
                                      Royal Phillips Electronics. Mr. Boonstra is also a member of
                                      the Supervisory Board of the Technical University Eindhoven,
                                      Amstelland  N.V.,  Atos-Origin,  Sara Lee/DE N.V. and Hunter
                                      Douglas International N.V.                                  

Sir Michael Perry  February 26, 1934  Sir  Michael  Perry  CBE  is  a  British  national.  He  was
                                      appointed in 1997 and his term runs until 2004.  Sir Michael
                                      is a former  Chairman  of  Unilever,PLC.  He is  Chairman of
                                      Centrica PLC,  Chairman of the Dunlop  Slazenger  Group Ltd,
                                      Deputy Chairman of Bass PLC, Non-Executive Director of Marks
                                      & Spencer PLC, President of the Marketing Council,  Chairman
                                      of the Shakespeare  Globe Trust,  President of the Liverpool
                                      School  of  Tropical  Medicine,   Chairman  of  the  British
                                      Government's  Senior  Salaries  Review Body and President of
                                      the Anglo Nederlands Society.                               

L.J.R. de Vink     February 12, 1945  Lodewijk  J.R.  de  Vink  is an  American  national.  He was
                                      appointed in 1998 and his term runs until 2002.  Mr. de Vink
                                      is a former  Chairman,  President & Chief Executive  Officer
                                      and Director of Warner-Lambert  Company. He is also a member
                                      of the  Board  of the  National  Foundation  for  Infectious
                                      Diseases,   United   Negro   College   Fund  and   Nijenrode
                                      University,  National Actors Theater,  New Jersey Performing
                                      Arts Center and Advisory Board of Sotheby's.                

Corporate Executive Board                                                       

The Corporate Executive Board is responsible for the management of our business.
The Corporate Executive Board must consist of at least three members. Members of
the Corporate  Executive  Board are appointed and discharged by the  Supervisory
Board.  There is no stated term of office for Corporate  Executive Board members
or other executive officers.                                                    

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As of March 30,  2001,  the  members of the  Corporate  Executive  Board were as
follows:                                                                        

                                                        [Enlarge/Download Table]


NAME                        DATE OF BIRTH      BUSINESS EXPERIENCE AND ACTIVITIES                          
                                                                                                           
C.H. van der Hoeven         September 9, 1947  Cees van der Hoeven  joined Royal Ahold in 1985 as Executive
President                                      Vice  President  of  Finance  and  Administration.   He  was
                                               appointed President/CEO in March 1993. In this position, Mr.
                                               van der Hoeven is responsible for  management,  development,
                                               communications, global sourcing, and legal affairs. Prior to
                                               joining  Ahold,  Mr. van der  Hoeven  held the  position  of
                                               Finance  Director  of  Petroleum  Development   Corporation,
                                               Finance Director for Nederlandse Aardolie Maatschappij (NAM)
                                               and various  positions with Royal Shell  International.  Mr.
                                               van der Hoeven is also a member of the Supervisory  Board of
                                               ABN AMRO Bank N.V., KPN (Royal Dutch Telecom) and LVMH (Moet
                                               Hennessy Louis Vuitton).                                    

J.G. Andreae                April 25, 1946     Jan Andreae  joined Royal Ahold in 1980 and has held various
                                               positions  since that time,  including  President  of Albert
                                               Heijn  and his  most  recent  position  as a  member  of the
                                               Corporate  Executive Board. Mr. Andreae was appointed to the
                                               board  in  1997  and  is   responsible   for  our   European
                                               operations.  Mr.  Andreae  is  also  the  President  of  the
                                               Supervisory  Board  of SVM  (foundation  for  packaging  and
                                               environment),  Chairman of Raad NDH (Dutch Retail  Council),
                                               President of ERRT (European  Retail Round Table),  Member of
                                               the  Supervisory  Council  Hogeschool  Amsterdam,  and Board
                                               member of CIES.                                             

A.M. Meurs                  November 5, 1950   Michiel  Meurs joined Royal Ahold in 1992 as Vice  President
                                               Finance and has since then held the positions of Senior Vice
                                               President   Finance,    Senior   Vice   President   Business
                                               Development  and Member of the Executive  Board and CFO. Mr.
                                               Meurs  was  appointed  to the  Board  in  April  1997 and is
                                               responsible for the administration,  finance, internal audit
                                               and business  development  of Royal Ahold.  Prior to joining
                                               Ahold, Mr. Meurs worked as the Senior Vice President for ABN
                                               AMRO Bank in Rotterdam and various other  positions with ABN
                                               Bank in The Netherlands  and Singapore.  Mr. Meurs is also a
                                               member of the Supervisory Board of Van der Hoop Effectenbank
                                               N.V.  and a member of the  Supervisory  Board of  Schuitema,
                                               N.V.                                                        

A.S. Noddle                 August 7, 1940     Allan  Noddle  officially  joined  Royal  Ahold in 1981 when
                                               Giant Food Stores, Inc., for which he was the Vice President
                                               of Sales and later  President and CEO, was acquired by Royal
                                               Ahold.  In  1997,  Mr.  Noddle  moved  to  the  position  of
                                               President  and CEO of Ahold  USA  Support  Services  and was
                                               appointed  as a member of the  Executive  Board in 1998.  In
                                               this  position,  Mr.  Noddle  is  responsible  for our Latin
                                               American and Asia Pacific  operations.  Mr.  Noddle has also
                                               served on the Board of Directors of Junior Achievement,  the
                                               Better Business Bureau, the YMCA, Capital Health Foundation,
                                               Allied  Arts,  Jewish  Community  Center,   Hershey  Medical
                                               Center,  United  Jewish  Community,  and  Chairman  of Topco
                                               Associates.                                                 

R.G. Tobin                  July 13, 1938      Robert Tobin officially joined Royal Ahold in 1996 when Stop
(expected to retire in 2001)                   & Shop  Companies,  Inc. for which he was President and CEO,
                                               was  acquired by Royal Ahold.  Mr. Tobin was  appointed as a
                                               member of the Executive Board in 1998. In this position,  he
                                               is responsible for our operations  within the United States.
                                               Mr. Tobin is also a member of the Board of Directors for the
                                               Food  Marketing  Institute  and a  member  of the  Board  of
                                               Overseers for the Dana-Farber Cancer Institute.             

M.P.M. de Raad              January 7, 1945    Theo de Raad  joined  Royal Ahold in 2001 as a member of the
                                               Executive   Board.   Mr.  de  Raad  is  expected  to  assume
                                               responsibility  for our  Latin  American  and  Asia  Pacific
                                               operations.  Prior to  joining  Ahold,  Mr. de Raad held the
                                               position of a member of the Executive  Board of Directors of
                                               METRO AG,  Chairman of the  Executive  Board of Directors of
                                               SHV  MAKRO  NV  and a  member  of  the  Executive  Board  of
                                               Directors of SHV Holdings N.V.                              

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Other Executive Officers                                                        
As of March 30, 2001,  other key  executive  officers who are not members of the
Corporate Executive Board were as follows:                                      

                                                        [Enlarge/Download Table]


NAME                    DATE OF BIRTH       BUSINESS EXPERIENCE AND ACTIVITIES                          
                                                                                                        
G.J.G. van Breen        November 16, 1956   Gerard  van  Breen  joined  Ahold  in 1987 as the  Marketing
                                            Manager of Albert  Heijn  Institutional  Food Supply and has
                                            held several  Marketing  positions  within the company since
                                            that time.  In January 2000, he was appointed to Senior Vice
                                            President of Ahold Global Sourcing.  Prior to joining Ahold,
                                            Mr. Van Breen held  various  marketing  and sales  positions
                                            within Colgate  Palmolive  Benelux  (Belgium) and Weesp (The
                                            Netherlands).  Mr.  van  Breen is also the  chairman  of the
                                            Supervisory Board of AMS Marketing Service B.V. and a member
                                            of the Advisory Board European Food Management  Institute of
                                            the Erasmus University.                                     

A.J. Brouwer            September 27, 1961  Arthur Brouwer joined Ahold in 1992 as the Vice President of
                                            Management  Development and Organization and was promoted to
                                            Senior  Vice   President  of  Management   Development   and
                                            Organization  in October 1997.  Prior to joining Ahold,  Mr.
                                            Brouwer  held the  position  of Manager  of Human  Resources
                                            Planning and  Development  at  Mercedes-Benz  Nederland B.V.
                                            Currently,  Mr. Brouwer is also the Chief Support Officer of
                                            the European Competence Center                              

A. Buitenhuis           February 1, 1947    Andre  Buitenhuis  joined Ahold in 1983 as Vice President in
                                            Ahold corporate  financial  staff. In 1996, he was appointed
                                            as Senior  Vice  President  of Finance  and Fiscal  Affairs.
                                            Prior to joining Ahold, Mr.  Buitenhuis held a position with
                                            the  Dutch  Revenue  Service  and  served  on the  Amsterdam
                                            Corporate Income Tax Inspectorate.  Mr. Buitenhuis is also a
                                            member of the Amcham's Tax Committee.                       

P.P.M. Ekelschot        April 3, 1942       Paul Ekelschot joined Ahold in 1989. He held the position of
                                            Senior  Vice  President  of  Internal  Audit from April 1997
                                            through April 1, 2000 and was then  appointed to Senior Vice
                                            President of Financial Services. Prior to joining Ahold, Mr.
                                            Ekelschot  held the positions of Vice  President of Internal
                                            Audit  at  Philips  France  and  Head of  Internal  Audit at
                                            Polygram  B.V.  Currently,  Mr.  Ekelschot  is  also a Board
                                            Member  of  the  Dutch   Institute   of   Certified   Public
                                            Accountants (Royal Nivra).                                  

H. Gobes                August 15, 1938     Hans Gobes  joined  Ahold in 1990 in the  position of Senior
                                            Vice  President of  Communications.  Prior to joining Ahold,
                                            Mr.  Gobes held the  position of Director of  Communications
                                            for  DSM   chemical   company  and   several   international
                                            communication    positions   for   the   American   Polaroid
                                            Corporation.                                                

A.H.P.M. van Tielraden  September 1, 1955   Ton van Tielraden joined Ahold in 1997 as the Vice President
                                            and Deputy General  Counsel and was promoted in January 2000
                                            to  Senior  Vice  President  of Legal  Affairs  and  General
                                            Counsel.  Prior to joining Ahold, Mr. Van Tielraden held the
                                            position of Director of Legal  Affairs for  Hagemeyer  N.V.,
                                            Senior Legal Advisor for Unilever B.V., and General  Counsel
                                            for Quest International.                                    

L.A.P.A. Verhelst       May 31, 1943        Bert Verhelst joined Ahold in 1997 in the position of Senior
                                            Vice  President of  Administration.  Prior to joining Ahold,
                                            Mr.  Verhelst  was a Member  of the Board of  Directors  for
                                            Koninklijke  BolsWessanen  N.V.  ,  Member  of the  Board of
                                            Directors of N.V. Koninklijke  Distilleerderijen Erven Lucas
                                            Bols and Managing Director of Pays-Bas Property Fund N.V.   

N.L.J. Berger           December 20, 1952   Nol Berger  joined  Ahold in 1989 in the  position of Deputy
                                            General  Counsel.  In 1994,  he was  appointed  as Corporate
                                            Secretary of Royal Ahold. Prior to joining Ahold, Mr. Berger
                                            held  positions  with   Amsterdam-Rotterdam  Bank  N.V.  and
                                            Nederlandsche Credietverzekering Mij. N.V.                  

J.P. Herweijer          May 27, 1950        Jan Pieter Herweijer joined Ahold in 2000 as the Senior Vice
                                            President of IS&T.  Prior to joining  Ahold,  Mr.  Herweijer
                                            held the position of Vice President of Professional Services
                                            and Global Processes at Origin  International,  Director and
                                            Chairman of IBM Global Services  Netherlands and a Member of
                                            the Board of Getronics N.V.                                 

Th. Smit                July 25, 1956       Thijs Smit joined Ahold in August of 2000 in the position of
                                            Senior Vice  President of Internal  Audit  Europe.  Prior to
                                            joining  Ahold,  Mr. Smit held the  positions of Director of
                                            Audit at Corus,  Head of Internal  Audit at Royal  Hoogovens
                                            N.V., Director of Finance at Belgische  Distributie and Head
                                            of Internal Audit at PTT Post. Currently, Mr. Smit is also a
                                            Boardmember   of  the   Institute   of   Internal   Auditors
                                            Netherlands and participates in several committees regarding
                                            the audit profession.                                       

R.J. van Solt           May 5, 1948         Ronald van Solt  joined  Ahold in 1976 and has held  various
                                            positions in the company  since that time.  Mr. van Solt was
                                            appointed to the position of Senior Executive Vice President
                                            of Strategy  and  Planning in 2000.  Prior to this,  Mr. Van
                                            Solt held the positions of President and CEO of Albert Heijn
                                            B.V. and Senior Vice  President of Business  Development  of
                                            Albert Heijn B.V.                                           

Compensation of Directors and Officers                                          
The aggregate  amount of compensation  paid by us in fiscal 2000 for services in
all  capacities to the  Supervisory  Board (the  "Directors")  and the Corporate
Executive Board, the Senior Vice Presidents and the Corporate Secretary of Royal
Ahold  (collectively  referred to as the  "Officers")  was EUR 12.0 million.  In
addition,  in fiscal 2000, we made aggregate  contributions in the amount of EUR
2.0 million to pension plans on behalf of the Directors and Officers.  A portion
of the compensation of the members of the Corporate  Executive Board is based on
the outcome of key performance indicators. Currently, no other service contracts
other than those described  above,  exist which provide  benefits to officers or
directors upon termination of service.                                          

Share Ownership                                                                 
For full disclosure of stock options held by Officers and Directors,  along with
a description of the stock option plan,  please see note 15 to the  consolidated
financial statements included elsewhere in this annual report.                  

In addition,  as of March 30, 2001, the members of our Corporate Executive Board
were personally holders of 3,458 Royal Ahold common shares. Of these shares, Mr.
C.H. van der Hoeven held 1,699, Mr. A.M. Meurs held 334 and Mr. A.S. Noddle held
1,425, all of which are  substantially  less than 1% of the total share capital.
The  members  of our  Executive  Board are not  indirect  owners  other  than as
disclosed under Item 9, nor do they hold any power of attorney to vote on common
shares nor do they hold voting rights through any intermediate person. Likewise,
the members of the Corporate  Executive  Board are not direct or indirect owners
nor do they hold any power of attorney to vote on cumulative preferred financing
shares.                                                                         

As of March 30, 2001, the members of the  Supervisory  Board do not own,  either
directly or  indirectly,  or on behalf of other  companies or third  parties any
common shares or cumulative preferred financing shares.                         

Audit Committee                                                                 
The audit  committee is responsible  for providing on behalf of the  Supervisory
Board,  supervision of our accounting and reporting policies and procedures,  as
well as the supervision of risk assessment and internal controls.  In fulfilling
their responsibilities, it is recognized that members of the audit committee are
not,  and  do not  represent  themselves  to  be,  accountants  or  auditors  by
profession,  nor experts in the field of accounting and auditing,  but rather to
have a basic  understanding  of the  financial  statements  and condition of the
company.                                                                        

The audit  committee is comprised of at least three  members of the  Supervisory
Board and is chaired by the President of the Supervisory  Board.  Members of the
audit committee are elected by the  Supervisory  Board for a period of two years
and serve until their successors are duly elected and qualified. As of March 30,
2001, the audit committee members were as follows:                              

H. de Ruiter                                                                    
R.J. Nelissen                                                                   
Sir Michael Perry                                                               

Remuneration Committee                                                          
The  remuneration  committee is  responsible  for the review and proposal to the
Supervisory Board of the remuneration of the members of the Corporate  Executive
Board.  The  remuneration  committee  is  comprised  of  three  members  of  the
Supervisory  Board.  Members of the  remuneration  committee  are elected by the
Supervisory Board for a period of two years and serve until their successors are
duly elected and  qualified.  As of March 30, 2001, the  remuneration  committee
members were as follows:                                                        

H. de Ruiter                                                                    
R.J. Nelissen                                                                   
Sir Michael Perry                                                               

Employees                                                                       
The average number of associates employed by us in fiscal 2000 were:            
o  152,628 in the United States;                                                
o  113,724 in Europe;                                                           
o  57,446 in Latin America; and                                                 
o  8,288 in Asia Pacific.                                                       

A large portion of these 332,086 employees were part-time  employees.  As of the
end of fiscal 2000, we had 279,533 full-time  employee  equivalents  compared to
219,587 as of the end of fiscal 1999 and  201,461 as of the end of fiscal  1998.
The number of  employees  rose in 2000  primarily  because of  acquisitions  and
opening of new stores.                                                          

Employees of our  subsidiaries  in The Netherlands who are also customers of our
supermarket  chain,  Albert Heijn,  are entitled to  participate in the AH Vaste
Klanten Fonds ("AHVKF" or "Dutch  Customer  Fund").  The AHVKF is an arrangement
through which customers of Royal Ahold's Dutch supermarket chain,  Albert Heijn,
as well  as our  employees  in the  Netherlands  and  members  of our  Corporate
Executive  Board  and  Supervisory   Board,  can  indirectly  benefit  from  the
profitability of Royal Ahold. Fortis Investment  Management  Netherlands N.V. is
responsible for investing half of the funds of AHVKF in our common shares listed
on Euronext Amsterdam. The other half of the funds of the AHVKF is lent to us at
the European Central Bank rate plus 1.25%.  N.V.  Nederlandsch  Administratie en
Trustkantoor  ("NATK",  Dutch for "Dutch  Administration  and Trust  Office") in
Amsterdam  administers the AHVKF. As of December 31, 2000,  AHVKF held 5,962,899
common shares.                                                                  

As of March 30, 2001 the members of our Corporate Executive Board of Royal Ahold
were  personally  direct  holders  of  29,451  units  in  the  AHVKF.  Of  these
participations Mr. C.H. van der Hoeven held 14,726, Mr. A.M. Meurs 4,908 and Mr.
J.G. Andreae 9,817. As of March 30, 2001, the members of our Corporate Executive
Board  do  not  own  on  behalf  of  third   parties  or  other   companies  any
participations  in  the  AHVKF.  As of  March  30,  2001,  the  members  of  the
Supervisory Board do not own, either directly or indirectly, on their own behalf
or on behalf of other  companies or third parties any common  participations  in
the AHVKF.                                                                      

Related Party Transactions                                                      
In January 1994, a group of our Dutch  managers and employees  replaced a EUR 15
million capital  investment in the AHVKF,  an independent  investment fund which
invests  all of its assets in our shares and debt.  The capital  investment  had
been held by Het  Weerpad  B.V.,  an  investment  company  of the Heijn  family,
founders of Royal Ahold.  We made loans to this group of managers and employees,
which included some of our Officers, to assist them with their investment in the
Fund.  These  floating-rate  loans,  bearing  fluctuating  interest based on the
European Central Bank interest rates on deposits, are generally due in ten years
from issuance or upon an individual's termination of employment, if earlier, and
are secured by each individual's corresponding investment in the Fund.          

In July 1996 and April 1998, additional loans were granted to our Dutch managers
and  employees to purchase  additional  investments  in the Fund.  Some Officers
participated  in these  purchases.  As of the end of fiscal 2000, a total of EUR
55.8 million of loans was outstanding  from  approximately  4,300 Dutch managers
and employees including EUR 1.8 million in amounts due from our Officers.       

Collective Bargaining Relative to Royal Ahold                                   
The  legal  framework  regarding  our labor  relationships  is  provided  for in
applicable  collective  agreements  depending  on  the  geographic  location  of
individual stores and distribution facilities.                                  

ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS                       

We are not directly or indirectly owned or controlled by another  corporation or
by any foreign  government.  Except as  described  under  "Cumulative  Preferred
Shares" below,  there are no arrangements  known to us that may, at a subsequent
date, result in a change in our control.                                        

Cumulative Preferred Shares                                                     

In March 1989 we,  together with Stichting Ahold  Continuiteit  ("SAC" or "Ahold
Continuity  Foundation"),  entered into an agreement  (the "option  agreement").
This option  agreement  was  amended and  restated in April 1994 and March 1997.
Pursuant to this option agreement, SAC was granted an option to acquire from us,
from time to time until March 2004,  cumulative  preferred  shares up to a total
par value  that is equal to the total par value of all  issued  and  outstanding
shares of our capital  stock at the time of exercising  the option.  We have the
right,  pursuant to the option agreement,  to place cumulative  preferred shares
with SAC up to a total par value that is equal to the total nominal value of all
issued and  outstanding  shares of our capital  stock at the time of placing the
cumulative  preferred shares. The holders of the cumulative preferred shares are
entitled to 2,000 votes per share and a cumulative  dividend on the  outstanding
and paid-up shares, based on AIBOR, with a minimum dividend of 5.75%. Subject to
limited  exceptions,  each transfer of cumulative  preferred shares requires the
approval of the Corporate Executive Board.  Cumulative preferred shares can only
be issued in registered  form. No share  certificates  are issued for cumulative
preferred shares.                                                               

We  may  stipulate  that  only  25% of the  nominal  value  will  be  paid  upon
subscription  for cumulative  preferred  shares until payment in full of the par
value is later called by us. No cumulative  preferred shares have been issued or
were outstanding during fiscal years 2000, 1999 or 1998.                        

The  option   agreement  and  the  cumulative   preferred  shares  have  certain
anti-takeover  effects.  The  issuance of all  authorized  cumulative  preferred
shares will cause  substantial  dilution of the  effective  voting  power of any
shareholder, including a shareholder that attempts to acquire us, and could have
the effect of delaying, deferring and preventing a change in our control.       

SAC is a  non-membership  organization  with a  self-appointed  managing  board,
organized  under the laws of The  Netherlands.  Its statutory  objectives are to
enhance our continuity and identity in case of a hostile take-over  attempt.  As
of March 30, 2001, the members of the board of the SAC were:                    

Name                   Principal occupation or relation to Royal Ahold          
Voting members                                                                  
J.J. Slechte           Former President of Shell Nederland B.V.                 
W.E. de Vin            Former Civil Law Notary                                  
P.J. van Dun           Former Executive Vice President of Royal Ahold           

Non-voting members                                                              
H. de Ruiter           Chairman of the Supervisory Board of Royal Ahold         
C.H. van der Hoeven    President of the Corporate Executive Board of Royal Ahold

Significant ownership of voting shares, including cumulative preferred financing
shares                                                                          

Under the 1996  Netherlands' Act of Disclosure of Holdings in Listed  Companies,
or the  Disclosure  Act,  any person who,  directly or  indirectly,  acquires or
disposes of an interest in the capital or the voting rights of a public  limited
liability  company  incorporated  under Dutch law with an official  listing on a
stock exchange within the European  Economic Area, must give a written notice to
the company of such acquisition or disposal,  if as a result of such acquisition
or disposal the  percentage  of legal or beneficial  capital  interest or voting
rights held by such person falls within another  percentage range as compared to
the percentage  range held by such person prior to such acquisition or disposal.
The percentage ranges are 0-5, 5-10, 10-25, 25-50, 50-66 2/3 and over 66 2/3.   

As of March 30, 2001,  except as  discussed  below we do not know of any persons
that own of record or beneficially more than 5% of any class of capital interest
and/or voting rights.  All of the issued and  outstanding  cumulative  preferred
financing  shares are held by a trustee  that  issued  corresponding  depositary
receipts  to  the  following  five  investors:  Fortis  N.V.,  ING  Groep  N.V.,
Cooperatie Achmea U.A., Aegon N.V. and CGNU plc. These investors do not hold the
voting rights in connection with these  depositary  receipts because the trustee
exercises all of the voting rights attached to the cumulative  preferred shares,
as described in Item 10 - "Additional Information - Voting Rights".             

Voting rights of shareholders  owning more than 5% of any class of shares do not
differ from other  shareholders.  For more details on voting  rights  please see
Item 10-  "Additional  Information - Articles of Association - Voting Rights" of
this annual report.                                                             

With  respect to the bearer  common  shares,  we do not  maintain a register  of
holders of such shares.  Therefore, we do not know of the existence and identity
of parties, if any, which own more than 5% of our common shares.  Therefore,  we
do not know the number and  percentage  of common  shares in bearer form held by
directors and officers as a group.                                              

For  information  on  the  number  of  registered  common  shares  and  American
Depositary  Receipts  held by holders  having  their  registered  address in the
United States, please see Item 9 - "The Offer and Listing".                     

Related party transactions                                                      

See Item 6 -  "Directors,  senior  management  and employees -  compensation  of
directors and officers".                                                        

ITEM 8. FINANCIAL INFORMATION                                                   

Consolidated Statements and Other Financial Information                         
Our consolidated  financial statements have been audited by independent auditors
in accordance with auditing standards  generally accepted in The Netherlands and
the United States. For a discussion of the principal  differences  between Dutch
GAAP  and  U.S.  GAAP  relevant  to  Royal  Ahold,  please  see  note  23 to the
consolidated  financial statements,  included elsewhere in this annual report. A
consolidated  balance  sheet is presented  for fiscal 2000 and 1999 along with a
consolidated statement of income,  statement of cashflow and statement of change
in  shareholders'  equity which are  presented  for fiscal 2000,  1999 and 1998.
Reference is made to Item 18 for detailed financial information.                

Litigation and Legal Proceedings                                                
We are involved in a litigation  matter  arising out of the December 2000 filing
by Bradlees Stores,  Inc.  ("Bradlees  Stores") for bankruptcy  protection under
Chapter 11 that was made in order to facilitate the wind-down and liquidation of
its  assets.  As a result of a prior  bankruptcy  reorganization  of Bradlees in
1995, Bradlees assumed approximately 102 leases, a majority of which were leases
that Stop & Shop had assigned to Bradlees  prior to Stop & Shop's 1992  spin-off
of Bradlees.  Under  certain  circumstances,  it is likely that Stop & Shop will
have  potential  liability  under  certain  of  these  leases  in the  event  of
non-performance by Bradlees.  Stop & Shop may retain liability under leases that
are not  purchased  and are  subsequently  rejected  by  Bradlees as part of the
bankruptcy  proceeding  begun in  December  2000.  S&S/B Lease  Disposition  LLC
("S&S/B"),  which  is  wholly  owned  by Stop & Shop,  has  been  involved  in a
litigation arising from an appeal by Vornado Realty Trust, which is the landlord
with respect to some of the Bradlees  leases,  from a Bankruptcy  Court decision
approving a Lease Designation and Disposition  Agreement between Bradlees Stores
and New  Horizons of Yonkers,  Inc.  (collectively  "Bradlees")  and S&S/B dated
January 11, 2001 (the "Disposition Agreement").  S&S/B and Bradlees entered into
the Disposition  Agreement to provide for the sale and disposition of all of the
Bradlees real property leases,  including the leases under which Stop & Shop may
have  potential  liability.  Under  the  agreement,  which was  approved  by the
Bankruptcy Court following a hearing on January 30, 2001, (1) S&S/B is permitted
to designate  third party  purchasers for all of the Bradlees  leases,  with all
purchases  being subject to a subsequent  auction to maximize  value,  (2) S&S/B
will guarantee that Bradlees receives at least $150 million from the proceeds of
the sale of the leases to third parties, which guaranteed amount will be reduced
by the amount of a  substantial  initial  payment by S&S/B to Bradlees  enabling
Bradlees to pay off its senior secured  working capital lenders that have a lien
against  certain  of the  Bradlees  leases,  (3) S&S/B and  Bradlees  will share
additional  proceeds  after the  recovery of certain  expenses of selling  those
leases to third  parties,  including  carrying  costs and (4) S&S/B can  exclude
leases  from  the  agreement  which  Bradlees  has the  right to  reject  if not
otherwise  sold,  with S&S/B being  responsible  for Bradlees'  lease  rejection
damages  exceeding $30 million,  which amount does not include rejection damages
related to 17 specific  leases  which  either are likely to be rejected or which
have particularly high rejection damage payments. S&S/B may purchase some of the
Bradlees  leases,  subject to an auction  process  where other  parties would be
entitled to submit bids.  As of March 30, 2001,  33 of the Bradlees  leases have
been purchased.                                                                 

On February 9, 2001, the United States District Court for the Southern  District
of New York  upheld the  Bankruptcy  Court's  decision  to deny  Vornado  Realty
Trust's  challenge  to the  Disposition  Agreement,  except  for the  Bankruptcy
Court's decision to allow S&S/B and Bradlees to allocate future rental increases
under the Vornado  leases.  Neither  Bradlees  nor Vornado is expected to appeal
this decision.  In addition,  S&S/B does not intend to appeal this decision.  If
the Disposition  Agreement is not appealed from the District Court decision,  we
believe that any remaining contingent liability that we may have with respect to
the  Bradlees  leases  will not have any effect on our  financial  condition  or
operating results or, if the agreement is successfully  appealed,  that any such
remaining  contingent liability will not have a material effect on our financial
condition or operating results.                                                 

We are currently  involved in two litigation matters arising out of an Agreement
and Plan of Merger,  dated March 9, 1999 (the "Merger  Agreement"),  between us,
our subsidiary  Ahold  Acquisition,  and SMG-II Holdings Corp.  ("SMG-II"),  the
indirect  parent  of the  entity  owning  the  Pathmark  chain of  supermarkets.
Pursuant to the Merger Agreement,  Ahold Acquisition was to acquire the Pathmark
stores by  merging  with  SMG-II.  In  accordance  with the terms of the  Merger
Agreement,  we terminated  the Merger  Agreement on December 16, 1999 because we
did not obtain the necessary  governmental  antitrust  approvals for the merger.
Prior  to our  termination,  SMG-II  alleged  that we had  breached  the  Merger
Agreement by failing to use "best efforts" to obtain all necessary approvals. We
filed a  complaint,  and later an amended  complaint,  in New York  State  court
seeking a  declaratory  judgment  that (1) the  "best  efforts"  provisions  are
unenforceable,  (2) we did not breach  any  provision  of the Merger  Agreement,
including the "best  efforts"  provisions,  and (3) we properly  terminated  the
Merger  Agreement.  SMG-II filed  counterclaims  seeking damages for (1) alleged
breaches of the "best  efforts"  provisions  (2)  alleged  breach of the implied
covenant of good faith and fair dealing, and (3) unfair competition. The damages
sought by SMG-II  are not  quantified.  The  parties  have  taken  some  written
discovery and have produced  documents.  In April 2000,  SMG-II brought a motion
for  partial  summary  judgment,  seeking  to  dismiss  our claim that the "best
efforts"  provisions  in the merger  agreement are  unenforceable.  We brought a
cross-motion for summary judgment,  claiming that the "best efforts"  provisions
are  unenforceable  as a matter of law, or have been  satisfied.  On December 5,
2000, the court granted our cross-motion for summary judgment,  finding that the
"best efforts"  provisions were satisfied and dismissing  SMG-II's claim that we
breached the Merger Agreement. SMG-II has appealed this decision. On January 16,
2001,  SMG-II  also filed a motion to  reargue  or renew its motion for  summary
judgment.  On January  16,  2001,  we filed a motion to  dismiss or for  summary
judgment on SMG-II's  remaining  causes of action under the implied  covenant of
good faith and fair dealing and unfair  competition. We are awaiting the court's
decision on these two motions.                                                  

We believe that we have good defenses to this claim and that any damages awarded
against us would not be material to us.  Accordingly,  we believe this case will
not have a material effect on our financial position or operating results.      

In a  separate  matter,  a holder of  preferred  stock in  Supermarkets  General
Holding Corporation ("SMG"), a subsidiary of SMG-II, commenced a class action in
a Delaware state court challenging the terms of the transaction  contemplated by
the Merger Agreement,  essentially  claiming that the  consideration  offered by
Ahold Acquisition was unfairly  allocated  between SMG's preferred  shareholders
and its common  shareholders.  The  parties to this  litigation  reached a class
settlement  dated  June 9,  1999 (the  "Settlement")  and,  as a  result,  Ahold
Acquisition  revised the tender offer.  Following our  termination of the Merger
Agreement,  the preferred  shareholder filed a motion to enforce the Settlement.
We opposed  the motion to enforce  the  Settlement  and also moved for a stay of
this action  pending  resolution of the New York action  described  above.  In a
decision  dated January 23, 2001,  the court agreed with our position that Ahold
Acquisition  had complied with  Settlement  and denied the motion to enforce the
Settlement.                                                                     

We believe that we have good defenses to this claim and that any damages awarded
against us would not be material to us.  Accordingly,  we believe this case will
not have a material effect on our financial position or operating results.      

There are no other  material  pending  legal  proceedings,  other than  ordinary
routine litigation incidental to us and our subsidiaries'  businesses,  to which
we or any of our  subsidiaries is a party or of which any of our property is the
subject.                                                                        

Significant changes                                                             
For  information  on any changes or events that have occurred after the close of
the balance sheet date on December 31, 2000,  please see Item 5 - "Operating and
Financial Review and Prospects - Recent Developments".                          

ITEM 9. THE OFFER AND LISTING                                                   

As of October 10, 2000, our Articles of Association  have been amended to change
the par  value of all our  shares  to euros  and to  eliminate  the  convertible
cumulative preferred financing shares.                                          

The  authorized  share  capital  as of  December  31,  2000 is  composed  of the
following classes.  For a full discussion of our share capital,  please see note
15 of the consolidated  financial statements,  included elsewhere in this annual
report.                                                                         

   800,000 cumulative  preferred  shares  of EUR  500  par  value  each;
   400,000,000 cumulative preferred financing shares of EUR 0.25 par value each;
1,200,000,000 common shares of EUR 0.25 each.                                 

Euronext  Amsterdam is the principal  trading market for our common shares.  Our
common  shares are also listed on the Swiss  Exchange.  As of December 31, 2000,
the  register  of holders of  registered  common  shares  contained  no names of
holders having their registered  address in the United States. The common shares
trade  in the  United  States  on the New  York  Stock  Exchange  in the form of
American  Depositary  Shares or ADSs and are  evidenced  by American  Depositary
Receipts or ADRs. The ADRs trade under the symbol "AHO".                        

The depositary for the ADSs is The Bank of New York (the "Depositary"). Each ADS
evidences  the right to  receive  one  common  share  deposited  under a deposit
agreement  for the ADSs.  We have been  informed by the  Depositary  that in the
United States,  as of December 31, 2000,  there were 15,136,645 ADRs outstanding
and 3,495 record owners  compared with  10,491,243  ADRs  outstanding  and 3,437
record owners at the end of fiscal 1999.                                        

Our U.S.  associates are able to purchase our ADRs through the Associates  Stock
Purchase Plan  ("ASPP") in the United  States.  Through the ASPP,  employees may
choose to purchase  ADRs through  voluntary  payroll  deductions.  During fiscal
2000,  approximately 306,021 ADRs were purchased by our U.S. associates pursuant
to the ASPP.                                                                    

The table below sets forth the high and low last sales prices during the periods
indicated for our common shares on Euronext Amsterdam and the closing prices for
our ADSs on the NYSE. The quarters used are our fiscal quarters.                

Prior to January 1999, Euronext Amsterdam quoted sales prices in Dutch guilders.
Effective  January 1999,  Euronext  Amsterdam quotes sales prices in euros only.
The prices  indicated  below in euros for fiscal  1998,  1997 and 1996 have been
translated into euros at the fixed rate of EUR 1 = NLG 2.20371.                 

               Euronext Amsterdam                 NYSE
                     High           Low             High         Low
                    n EUR per common share           in $ per ADR*
Fiscal 2000                                                                     
First quarter              30.05         21.00           31.13        20.63     
Second quarter             31.18         24.70           29.69        22.31     
Third quarter              34.65         28.86           30.88        26.31     
Fourth quarter             37.08         31.86           32.63        27.50     

Fiscal 1999                                                                     
First quarter              35.80         32.40           41 3/8        35 9/16  
Second quarter             38.55         32.90           41 9/16       34 3/16  
Third quarter              35.65         30.45           37 1/16       32 7/8   
Fourth quarter             32.35         25.61           32 15/16      25 7/8   
Fiscal 1998                31.76         23.46           31            25       
Fiscal 1997                29.50         15.88           31 7/8        19 53/64 
Fiscal 1996                16.40         10.06            9 17/25       6 1/2   

               Euronext Amsterdam                 NYSE
                     High           Low             High         Low
                    n EUR per common share           in $ per ADR*

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Share prices for the most recent six months are as follows:                     

March 2001                 35.82         32.56           33.49        29.00     
February 2001              35.19         32.65           32.65        29.96     
January 2001               34.68         29.96           32.63        28.56     
December 2000              36.94         32.30           32.63        29.00     
November 2000              37.08         33.07           32.31        28.69     
October 2000               34.85         31.43           29.44        27.75     
Share prices on                                                                 
March 30, 2001 were        35.35         34.68           31.25        30.09     
----------                                                                      
(*) Beginning  January  29,  2001,  share  prices on the NYSE are  quoted  using
decimals, however information for 2000 is also stated in decimals.      

ITEM 10. ADDITIONAL INFORMATION                                                 

Articles of Association                                                         

Organization and Register                                                       
Royal Ahold was founded in 1887 and has been incorporated as a limited liability
company under the laws of The  Netherlands by notarial deed dated April 29,1920.
Royal Ahold is registered with the Trade Register at the Chamber of Commerce and
Industry for Amsterdam, office Zaanstreek under No. 35000363.                   

Purpose and Object                                                              
Pursuant to Article 2 of the Articles of Association,  the object of Royal Ahold
is:                                                                             

"to  promote  or  join  others  in  promoting  companies  and  enterprises,   to
participate in companies and  enterprises,  to finance  -including the giving of
guarantees and acting as surety for the benefit of third parties as security for
liabilities of companies and  enterprises  with which the Company is joined in a
group or in which  the  Company  owns an  interest  or with  which  the  Company
collaborates  in any other  way-,  to conduct the  management  of and to operate
companies  engaged in the  wholesale  and retail  trade in consumer  and utility
products,  to operate  restaurants  and  companies  engaged in rendering  public
services, including all acts and things which relate or may be conducive thereto
in the broadest sense, as well as to promote,  to participate in, to conduct the
management of and, as the case may be, to operate businesses of any other kind."

The Articles of  Association  set forth the rules  governing  the  operations of
Royal Ahold and are  incorporated  by  reference  into this annual  report.  The
Articles of Association have been amended most recently by a notarial deed dated
October 10, 2000 executed  before Mr. W. Gooijer,  deputized by Prof. Mr. M. van
Olffen, a civil law notary in Amsterdam.  The most important changes are (1) the
amendment of the authorized  share capital to change the par value of our shares
to  euros;  and (2) the  elimination  of the  class  of  convertible  cumulative
preferred financing shares. The current Articles of Association are available to
the  public at the Trade  Register  of the  Amsterdam  Chamber of  Commerce  and
Industries and at the Corporate office of Royal Ahold at Albert Heijnweg 1, 1507
EH Zaandam, The Netherlands. The amended Articles of Association are filed as an
exhibit to our Report on Form 6-K,  dated  October 31, 2000,  which is available
for public  viewing at the public  reference room of the Securities and Exchange
Commission in Washington, D.C.                                                  

Share Capital                                                                   
For a  description  of our share  capital,  please  see Item 9 - "The  Offer and
Listing"  and  note  15  of  the  consolidated  financial  statements,  included
elsewhere in this annual report. Under this section - "Articles of Association",
"share" refers to cumulative  preferred shares,  cumulative  preferred financing
shares and common shares, unless otherwise stated.                              

Pre-emptive Rights                                                              
Holders of  cumulative  preferred  shares and  holders of  cumulative  preferred
financing shares do not have pre-emptive rights with respect to issues of common
shares.                                                                         

Holders of common shares have pro rata  pre-emptive  rights to subscribe for new
issues of common shares in proportion to their holdings, except for:            

(1)  issues  of  shares  to  employees  of  Royal  Ahold or  employees  of group
companies; and                                                        

(2)  issues of shares in return for non-cash consideration.                     

For these purposes, issues of shares include the granting of rights to subscribe
for  shares,  such as options  and  warrants,  but not the issue of shares  upon
exercise of such rights.                                                        

Pre-emptive  rights  with  respect to the common  shares  may be  restricted  or
excluded  by a  resolution  of the  Corporate  Executive  Board  subject  to the
approval  of the  Supervisory  Board.  The  Corporate  Executive  Board has been
delegated this authority by the General Meeting of Shareholders  with respect to
the common shares until May 6, 2002. The Corporate  Executive  Board's authority
may be extended by the General Meeting of Shareholders.  If no such extension is
given,  the  restriction  or  exclusion  of  pre-emptive  rights will  require a
resolution  of the  General  Meeting  of  Shareholders  upon a  proposal  by the
Corporate  Executive Board,  which is subject to the approval of the Supervisory
Board.  The  adoption by the General  Meeting of  Shareholders  of a  resolution
restricting  or  excluding  pre-emptive  rights  with  respect to common  shares
requires  a vote of (1) a  majority  of the votes  cast if at least  half of the
issued and outstanding share capital is present or represented at the meeting or
(2) at least  two-thirds  of the votes  cast if less than half of the issued and
outstanding capital is present or represented at the meeting.                   

Liquidation                                                                     
In the event of the  dissolution  and  liquidation  of Royal  Ahold,  the assets
remaining after payment of all debts will be distributed in the following order:

(1)  to the holders of cumulative preferred shares; and                         

(2)  to the holders of cumulative preferred financing shares.                   

If any assets  remain,  the holders of common shares shall be paid, if possible,
the par value amount of their common  shares plus the pro rata part of the share
premium reserve to which the holders of common shares are entitled.             

Corporate Governance                                                            
For  a  discussion  relating  to  corporate  governance,  please  see  Item  6 -
"Directors, Senior Management and Employees".                                   

General Meeting of Shareholders                                                 
A General Meeting of  Shareholders  must be held once a year, on a date no later
than June, as decided by the Corporate  Executive  Board,  to approve the annual
accounts and attend to other matters.  General  Meetings of Shareholders  may be
convened by the Corporate Executive Board, the Supervisory Board and, in certain
circumstances,  the  holders  of at least  10% of the  total  outstanding  share
capital  of Royal  Ahold.  Notice of the  general  meeting  will be given by the
Corporate  Executive Board, the Supervisory Board or the holders of at least 10%
of the total  outstanding  share capital of Royal Ahold,  as the case may be, at
least 15 days  prior to the  meeting,  not  including  the  date the  notice  is
published,  and will be published in at least one nationally  distributed  daily
newspaper  and the  Official  Price List  (Officiele  Prijscourant)  of Euronext
Amsterdam.  Holders  of  registered  shares  will  also  be  notified  by  mail.
Resolutions  of the General  Meeting of  Shareholders  cannot be annulled on the
grounds  that a letter  of notice  that is sent  timely  is not  received  or is
received late. There are no quorum  requirements  applicable to General Meetings
of Shareholders.                                                                

Special General Meetings of Shareholders regarding specific matters will be held
whenever they are called by the Corporate  Executive Board or by the Supervisory
Board, or when requested in writing by one or more  shareholders  and/or holders
of depositary receipts, representing at least 10% of the total outstanding share
capital of Royal Ahold. Meetings of holders of shares of a particular class will
be held  whenever  such a meeting is required by Dutch law or by the Articles of
Association. These meetings may be called by the Corporate Executive Board or by
the Supervisory  Board, or by one or more  shareholders or holders of depositary
receipts  who  jointly  represent  at least 10% of the total  outstanding  share
capital of the class  concerned.  Meetings  of holders of  cumulative  preferred
shares and  meetings of holders of a series of  cumulative  preferred  financing
shares are called by means of letters sent by registered or regular post.       

Voting                                                                          
Each share in the  capital of Royal  Ahold is  entitled to one vote for each EUR
0.25 par value represented  thereby.  Subject to certain exceptions provided for
by Dutch  law or the  Articles  of  Association,  resolutions  are  passed by an
absolute majority of the votes cast. Pursuant to Article 43.3 of the Articles of
Association,  a proposal  to alter the  Articles  of  Association  to change the
rights vested in the holders of shares of a particular  class requires the prior
approval of a meeting of holders of shares of that particular class. Among other
types of  resolutions,  a resolution of the General  Meeting of  Shareholders to
amend the Articles of  Association or to wind up Royal Ahold may only be adopted
upon a proposal of the Corporate  Executive  Board that has been approved by the
Supervisory Board.                                                              

The holders of the common  shares are entitled to one vote per share.  There are
no limitations, either under Dutch law or in our Articles of Association, on the
right of  non-residents  of the  Netherlands  or foreign  owners to hold or vote
Royal Ahold's common shares.                                                    

Holders of cumulative  preferred  financing  shares are entitled to one vote per
share and are  entitled  to vote upon the same  matters as the holders of common
shares.  These  shares  have been issued to the  Stichting  Administratiekantoor
Preferente Financierings Aandelen Ahold (the "Administratiekantoor"). The object
of the  Administratiekantoor  is to  acquire  and hold as a  trustee  cumulative
preferred financing shares in the share capital of Royal Ahold against the issue
of limited exchangeable  depositary receipts,  as well as to exercise all voting
rights attached to these shares. Holders of depositary receipts will be admitted
to the General Meeting of Shareholders,  but will not be allowed to vote in this
meeting  as the voting  rights  belong to the  Administratiekantoor.  Holders of
cumulative preferred stock are entitled to 2,000 votes per share. As of the date
of this annual report, no cumulative preferred shares were outstanding.         

Shareholders and holders of non-voting  depositary receipts are only entitled to
attend the General Meeting of Shareholders  and take part in the  deliberations,
and those who have voting rights may only vote at meetings of  shareholders,  if
they have signed the  attendance  list in  advance.  Holders of shares in bearer
form or depositary receipts in bearer form must deposit their share certificates
or  depositary  receipt  certificates  at the office of Royal Ahold prior to the
meeting.  Shareholders and holders of depositary  receipts may be represented by
written proxy.                                                                  

In  accordance  with Article 29 of the Articles of  Association,  the  Corporate
Executive Board has the authority to determine that  shareholders and holders of
depositary receipts who are registered as such on the record date are authorized
to attend the General  Meeting of  Shareholders  and to exercise  voting rights,
subject to certain conditions.  Prior to this change, only those who held shares
on the date of the General Meeting of Shareholders were authorized to attend the
meeting and exercise voting rights.                                             

No votes  may be cast in  respect  of shares  held by Royal  Ahold or any of its
subsidiaries  nor in respect of shares of depositary  receipts which are held by
Royal Ahold or by any of its subsidiaries. However, holders of certain ownership
rights and pledgees of shares  which  belong to Royal Ahold or its  subsidiaries
will not be excluded  from the right to vote if such grant of certain  ownership
rights or pledge was  created  before the  shares  concerned  were held by Royal
Ahold.                                                                          

ADR holders  will receive  notice from the  Depositary  whenever the  Depositary
receives notice of a General Meeting of Shareholders or solicitation of consents
or proxies of holders of common shares.  The Depositary will provide a statement
that the owners of ADRs as of the close of business  on a specified  record date
will be entitled to instruct  the  Depositary  as to the  exercise of any voting
rights represented by their ADRs.                                               

Upon the written  request of an owner of an ADR, the  Depositary  will endeavor,
insofar as practicable, to vote or cause to be voted the amount of common shares
or other  deposited  securities  represented by the ADRs in accordance  with the
instructions  set forth in the request.  The Depositary  will not vote shares or
other deposited  securities other than in accordance with such instructions.  If
the  Depositary  does not receive  instructions  from any owner on or before the
date  established by the Depositary for such purpose,  the share depositary will
deem the owner to have instructed the Depositary to give a  discretionary  proxy
to a  person  designated  by Royal  Ahold  for such  deposited  securities.  The
Depositary will then give a discretionary  proxy to a person designated by Royal
Ahold to vote such deposited securities.  No such instruction,  however, will be
deemed given and no such  discretionary  proxy will be given with respect to any
matter as to which Royal Ahold informs the Depositary  that (1) Royal Ahold does
not wish such proxy given, (2) substantial  opposition exists or (3) such matter
materially and adversely  affects the rights of holders of common shares.  There
can be no assurance  that the owners will  receive the notice  described in this
paragraph  sufficiently  prior to the date established by the Depositary for the
receipt of  instructions to ensure that the Depositary will in fact receive such
instructions on or before such date. For a discussion on ADRs, please see Item 9
- "The Offer and Listing".                                                      

Form and Transfer of Shares                                                     
The common shares are issued in bearer or registered  form, at the option of the
shareholder.  Common shares in bearer form may be exchanged for common shares in
registered  form,  or vice  versa,  at any time,  upon  written  request  to the
Corporate Executive Board of Royal Ahold.                                       

Common  shares  held in bearer form are  evidenced  by share  certificates.  The
Corporate  Executive  Board will determine the number of common shares in bearer
form that may be represented by one certificate.  For registered  common shares,
share  certificates may also be issued.  Share certificates which are issued for
bearer shares have a dividend sheet without  dividend  coupons or vouchers.  The
bearer CF ("Centrum voor  Fondsenadministratie")  certificates for common shares
are in  practice  held by an  approved  custodian  in order to allow  them to be
traded on Euronext Amsterdam.                                                   

The names and  addresses  of holders  of  registered  shares are  entered in the
shareholders'  registers for each class of shares which are  maintained by Royal
Ahold.   Such  registers  also  include  the  number  of  shares  held  by  each
shareholder,  the class and number of their  shares,  the amount paid up on each
share,  and whether any share  certificate  has been issued.  The registers also
include the names and addresses of persons who possess certain  ownership rights
or a pledge in respect of such shares. On request of the shareholder, pledgee or
a holder of  certain  ownership  rights,  and  without  charge,  Royal  Ahold is
required to provide an extract from the register of  shareholders  in respect to
its right to any  registered  share.  Registers  are  available at the office of
Royal Ahold for inspection by  shareholders,  as well as pledgees and holders of
certain  ownership  rights,  insofar as the voting right  attached to the shares
rests in them. Any part of a register kept outside The Netherlands in compliance
with laws or stock exchange regulations in the foreign jurisdictions  concerned,
however, is not available for such inspection.                                  

Transfer  of a  registered  share in the  capital  of Royal  Ahold  requires  an
instrument  of transfer  and, if Royal Ahold is not a party to the  transfer,  a
written  acknowledgment by Royal Ahold of the transfer.  The acknowledgment must
be made in the instrument of transfer, or by a dated statement on the instrument
of transfer,  or on a copy or extract thereof certified by a civil law notary or
the  transferor  to be a true copy or extract  of the  instrument  of  transfer.
Official  service by an authorized Dutch person of the instrument of transfer or
of such copy or extract on Royal Ahold is  considered to have the same effect as
an  acknowledgment  by Royal  Ahold of the  transfer.  In  addition,  if a share
certificate has been issued for a registered  share, the share  certificate must
be surrendered to Royal Ahold.  The transfer may then be  acknowledged  by Royal
Ahold by way of endorsement  to that effect written on the share  certificate or
by replacing the share certificate by a new share certificate issued in the name
of the transferee.                                                              

Every transfer of cumulative preferred shares and cumulative preferred financing
shares  (subject  to certain  exceptions)  shall  require  the  approval  of the
Corporate  Executive Board. The request must be made in writing and must specify
the  name  and  address  of the  proposed  transferee  and the  price  or  other
consideration  which the proposed  transferee is willing to give.  The Corporate
Executive Board may withhold  approval and instead  designate one or more buyers
who are willing to purchase the cumulative  preferred  shares and/or  cumulative
preferred  financing  shares  for  cash,  at a price  agreed  upon  between  the
transferor  and the  Corporate  Executive  Board,  within two  months  after the
intending buyers have been designated.  The Articles of Association  provide for
mechanisms whereby the price is to be determined, in the event that no agreement
is reached between the transferor and the Corporate Executive Board as described
above.  If the transferor does not receive any notice from Royal Ahold rejecting
the request for approval of the intended  transfer  within three months from the
receipt  thereof by Royal Ahold,  upon the expiration of the period the transfer
shall be deemed to have been granted.                                           

Issue of Additional Shares                                                      
Shares may be issued  pursuant to a resolution  adopted by a General  Meeting of
Shareholders  on a proposal of the Corporate  Executive  Board, or pursuant to a
resolution of the Corporate Executive Board, if such authorization is given by a
resolution  adopted by a General  Meeting of  Shareholders,  such  authority may
apply for a maximum  period of not more than five years.  The  resolution by the
General  Meeting of  Shareholders  to issue shares or to authorize the Corporate
Executive  Board to do so will be legally  valid only if it has been  previously
approved  or  simultaneously  approved  by each group of holders of the class of
shares concerned whose rights are affected by the issue.                        

Repurchase by Royal Ahold of Its Own Shares                                     
Royal  Ahold may  acquire  any class of its  shares in its  capital,  subject to
certain provisions of Dutch law and the Articles of Association, if:            

(1) shareholders'  equity less the payment required to make the acquisition does
not fall below the sum of paid-up capital and any reserves required by Dutch law
or the Articles of Association; and                                             

(2) Royal Ahold and its  subsidiaries  would  thereafter not hold shares with an
aggregate nominal value exceeding 10% of Royal Ahold's issued share capital.    

Any shares held by Royal Ahold and its  subsidiaries  in its own capital may not
be voted.                                                                       

An  acquisition  by Royal  Ahold of any class of shares in its  capital  must be
approved by resolution of the Corporate Executive Board, subject to the approval
of the  Supervisory  Board.  Acquisitions  by Royal  Ahold of  shares in its own
capital  may only take place if the  General  Meeting of  Shareholders  of Royal
Ahold has granted to the  Corporate  Executive  Board the authority to make such
acquisitions.  Such  authority  may apply for a maximum  period of 18 months and
must  specify  the number of shares  that may be  acquired,  the manner in which
shares may be acquired and the price limits within which shares may be acquired.
In May 2000,  the Annual  General  Meeting of  Shareholders  voted to extend the
authority to acquire shares through  November 15, 2001,  subject to the approval
of the Supervisory Board. As of the date of this annual report,  Royal Ahold has
not acquired any shares under this authorization.  Under this authorization, the
maximum  number of shares that can be acquired  cannot exceed the maximum amount
authorized by Dutch law (currently  10%) of the issued share capital at the time
of acquisition. No such authority is required for the acquisition by Royal Ahold
of shares in its own  capital  for the  purpose of  transferring  such shares to
employees of Royal Ahold or employees of a group company pursuant to an employee
stock  option plan and as long as such shares are quoted on the  official  price
list of a stock exchange.                                                       

Change of Control                                                               
For a  discussion  on the  possible  effect  that  the  issuance  of  cumulative
preferred  shares may have on  delaying,  deferring  or  preventing  a change of
control,  please see note 15 to the consolidated financial statements,  included
elsewhere in this annual report.                                                

Notification of Interest in Royal Ahold Shares                                  
For a  discussion  of  Dutch  law  provisions,  including  the  Disclosure  Act,
governing the ownership  thresholds  for  disclosure of  shareholder  ownership,
please  see  Item 7 - "Major  Shareholders  and  Related  Party  Transactions  -
Significant ownership of voting shares, including cumulative preferred financing
shares."                                                                        

Exchange  Controls                                                              
Currently,  there are no  limitations,  other than those  described  below under
"Taxation,"  regarding  the  payment by us to  non-residents  with regard to the
remittances of dividends,  or any other payments to or from non-resident holders
of our  securities.  The Disclosure Act provides that a civil court can issue an
order  suspending  voting  rights  of  a  shareholder  up  to  three  years  for
non-compliance  with the reporting  requirements under that Act. This penalty is
applicable  to both  resident and  non-resident  holders of common  shares.  The
existing  laws  and  regulations  of  The   Netherlands   impose  no  additional
limitations on  non-resident or foreign owners with respect to holding or voting
common shares other than those also imposed on resident owners.  Our Articles of
Association  do not impose any  limitation on (1)  remittances to or from abroad
regarding  dividends or capital or (2) rights of  non-resident or foreign owners
to hold or vote common shares.                                                  

Taxation                                                                        

The  information  set out  below  is only a  summary  of  certain  material  tax
consequences of the purchase, ownership and disposition of ADSs. Dutch, U.S. and
other taxation may change from time to time.  Prospective and current  investors
should consult their  professional  advisors as to the tax  consequences  of the
purchase,  ownership and disposition of our common shares or ADSs,  including in
particular the effect of tax laws of any other jurisdiction.                    

Dutch Taxation                                                                  

Income and Withholding Tax                                                      

In  general,  for Dutch tax  purposes,  holders  of ADSs will be  treated as the
beneficial  owners of our  shares  represented  by such ADSs.  Dividends  on our
common  shares are  subject to Dutch  withholding  tax of 25%.  Pursuant  to the
Income Tax Convention  between the United States and The Netherlands of December
18,1992  (the "Tax  Treaty"),  dividends  paid by us on our  common  shares to a
resident of or corporation  organized in the United States,  having no permanent
establishment  or business  property in The  Netherlands,  qualifying  as a U.S.
resident for the purpose of that  convention  and is entitled to the benefits of
that convention,  qualify for a reduction of Dutch  withholding tax on dividends
from  25% to 15%  (5% if the  beneficial  owner  is a  corporation  which  holds
directly at least 10% of the voting power of our shares).                       

Where a  resident  of or a  corporation  organized  in the  United  States has a
permanent  establishment in The Netherlands and our common shares form a part of
the business  property of such permanent  establishment,  dividends  received on
such  shares are  included  in the profit of such  establishment  and subject to
Dutch income tax or corporation  tax (assuming it relates to a  shareholding  of
less than 5%), as the case may be. The Netherlands' withholding tax on dividends
will be applied  at the full rate of 25% and  allowed  as a credit  against  the
Dutch income tax on such income.  Such tax will be treated as foreign income tax
eligible for credit against the shareholder's United States income taxes.       

A qualifying U.S.  pension trust or charitable or other exempt  organization may
be exempt from Dutch  withholding  tax on dividends  from its  investment in our
common  shares.  In order to qualify for this  exemption,  a pension  trust must
reside  in the  United  States,  generally  be  exempt  from  U.S.  taxes and be
constituted and operated exclusively to administer or provide benefits under one
or more funds or plans  established  to  provide  pension,  retirement  or other
employee benefits.                                                              

In order to qualify for this  exemption,  a U.S.  charitable  organization  must
reside  in the  United  States,  generally  be  exempt  from  U.S.  taxes and be
organized and carry on all of its activities in The Netherlands.                

Net Wealth Tax                                                                  

A holder of common shares or ADSs will not be subject to Dutch net wealth tax in
respect  of the  common  shares  or ADSs  provided  that  such  holder is not an
individual or, if such holder is an individual:                                 

(1)  the holder is not a resident or deemed resident of The Netherlands; and    
(2)  the holder does not have an  enterprise,  or an interest in an  enterprise,
     which  carries  on  business  in  The   Netherlands   through  a  permanent
     establishment or a permanent  representative to which or to whom the common
shares or ADSs are attributable.                                      

The Dutch net wealth tax has been abolished, as of January 1, 2001.             

Gift, Estate or Inheritance Tax                                                 

No gift,  estate or inheritance  tax will arise in The Netherlands in respect to
the  transfer or deemed  transfer  of common  shares or ADSs by way of a gift or
inheritance from a shareholder that is neither a resident nor deemed resident in
The Netherlands, unless either such shareholder has an enterprise or an interest
in an  enterprise  that is, in whole or in part,  carried on through a permanent
establishment or permanent  representative to which or to whom the common shares
or ADSs are attributable,  or such shareholder dies within 180 days after having
made a gift,  while  being,  on the  moment of his or her death,  a resident  or
deemed resident of The Netherlands.                                             

Taxes on Income and Capital Gains                                               

A holder of common  shares or ADSs will not be subject to Dutch  taxes on income
and capital gains provided that:                                                

(1)  the holder is not a resident or deemed resident of The Netherlands;        
(2)  the holder does not have an  enterprise,  or an interest in an  enterprise,
     which  carries  on  business  in  The   Netherlands   through  a  permanent
     establishment or a permanent  representative to which or to whom the common
shares or ADSs are attributable; and                                  
(3)  the holder does not have a  substantial  interest,  as defined in Dutch tax
     law, or a deemed substantial  interest, as defined in Dutch tax law, in our
     share capital or, if such holder does have such interest,  it is part of an
enterprise outside The Netherlands.                                   

United States Federal Income Taxation                                           

The following is a summary of the principal  United  States  federal  income tax
consequences that may be relevant with respect to the acquisition, ownership and
disposition  of common shares or ADSs.  This summary  addresses  only the United
States federal income tax considerations of holders that were initial purchasers
of common  shares or ADSs at the initial  issue price and hold common  shares or
ADSs as  capital  assets.  This  summary  does not  address  tax  considerations
applicable  to  holders  that may be  subject  to  special  tax  rules,  such as
financial  institutions,  insurance  companies,  real estate investment  trusts,
regulated investment companies, grantor trusts, dealers or traders in securities
or currencies,  tax-exempt entities, persons that received common shares or ADSs
as compensation  for the performance of services,  persons that will hold common
shares  or ADSs  as part of a  "hedging"  or  "conversion"  transaction  or as a
position in a "straddle" for United States federal income tax purposes,  persons
that have a "functional currency" other than the United States dollar or holders
that own (or are  deemed to own) 10% or more (by  voting  power or value) of our
shares. Moreover, this summary does not address the United States federal estate
and gift or alternative  minimum tax consequences of the acquisition,  ownership
and disposition of common shares or ADSs.                                       

This summary (1) is based on the Internal  Revenue Code of 1986, as amended (the
"Code"),  the United States Treasury Regulations and judicial and administrative
interpretations  thereof, in each case as is in effect and available on the date
of this  annual  report and (2) is based in part on the  representations  of the
Depositary and the assumption that each obligation in the Deposit  Agreement and
any related agreement will be performed in accordance with its terms. All of the
foregoing  are subject to change,  which  change could apply  retroactively  and
could affect the tax consequences described below.                              

The United States Treasury  Department has expressed  concern that  depositaries
for American depositary receipts, or other intermediaries between the holders of
shares of an issuer and the issuer,  may be taking actions that are inconsistent
with the claiming of United States  foreign tax credits by United States Holders
of such receipts or shares. Accordingly, the analysis regarding the availability
of a United  States  foreign  tax  credit  for Dutch  taxes and  sourcing  rules
described  below could be affected  by future  actions  that may be taken by the
United States Treasury Department.                                              

For purposes of this summary,  a "United  States  Holder" is a beneficial  owner
(or, in the case of a  partnership,  the holder) of common  shares or ADSs that,
for United States federal income tax purposes,  is: (1) a citizen or resident of
the United States,  (2) a partnership or corporation  created or organized in or
under the laws of the United States or any state thereof (including the District
of  Columbia),  (3) an estate the  income of which is  subject to United  States
federal  income  taxation  regardless of its source or (4) a trust if such trust
validly elects to be treated as a United States person for United States federal
income  tax  purposes  or if (x) a court  within  the  United  States is able to
exercise primary  supervision over its administration and (y) one or more United
States persons have the authority to control all of the substantial decisions of
trust. A "Non-United  States Holder" is a beneficial owner (or, in the case of a
partnership,  a  holder)  of common  shares or ADSs that is not a United  States
Holder.                                                                         

Each  prospective  purchaser  should consult its own tax advisor with respect to
the  United  States  federal,  state,  local and  foreign  tax  consequences  of
acquiring, owning or disposing of common shares.                                

Ownership of ADSs in General                                                    
For United States federal  income tax purposes,  a holder of ADSs generally will
be treated as the owner of the common shares represented by such ADSs.          

Distributions                                                                   
The gross  amount of any  distribution  we make of cash or property  (other than
certain distributions,  if any, of common shares distributed pro rata to all our
shareholders,  including holders of ADSs) with respect to common shares or ADSs,
before reduction for any Dutch taxes withheld  therefrom,  will be includible in
income  by a  United  States  Holder  as  dividend  income  to the  extent  such
distributions are paid out of our current or accumulated earnings and profits as
determined  under United States  federal income tax  principles.  Such dividends
will not be eligible for the dividends received  deduction  generally allowed to
corporate United States Holders.  To the extent,  if any, that the amount of any
distribution we make exceeds our current and accumulated earnings and profits as
determined under United States federal income tax principles, it will be treated
first as a tax-free return of the United States  Holder's  adjusted tax basis in
the common  shares or ADSs and  thereafter  as capital  gain. We do not maintain
calculations  of our earnings and profits under United States federal income tax
principles.                                                                     

Any such dividend paid in euros will be included in the gross income of a United
States  Holder in an amount equal to the United States dollar value of the euros
on the date of receipt.  The amount of any  distribution  of property other than
cash will be the fair market value of such property on the date of distribution.

A United States  Holder may elect to deduct in computing its taxable  income or,
subject to certain complex limitations on foreign tax credits generally,  credit
against its United States federal income tax liability Dutch  withholding tax at
the rate  applicable  to such United  States  Holder.  As discussed  above under
"Dutch Taxation - Income and Withholding  Tax," under the Tax Treaty,  dividends
paid by us to a  United  States  Holder  generally  will be  subject  to a Dutch
withholding  tax rate of 15%. Such reduced rate of  withholding  will apply only
if:                                                                             

     o    such  United  States  Holder is treated  as a  resident  of the United
          States for  purposes of such treaty and  otherwise  is entitled to the
benefits of such treaty and                                 

     o    the  dividends  are  not   effectively   connected  with  a  permanent
          establishment  or fixed  base of such  United  States  Holder  that is
situated in The Netherlands.                                

For purposes of calculating the United States foreign tax credit, dividends paid
by Ahold will generally  constitute  passive  income,  or in the case of certain
United States Holders,  financial services income.  United States Holders should
consult their tax advisors  regarding the  availability  of, and limitations on,
any such foreign tax credit.                                                    

If and to the extent that we pay a dividend on the common  shares or ADSs out of
dividend income from our non-Dutch  subsidiaries and are therefore entitled to a
credit for Dutch tax purposes for foreign  taxes  attributable  to such dividend
income  from  non-Dutch  subsidiaries,  there is a risk that the  United  States
Internal  Revenue Service might take the position that our allowable  credit for
Dutch  tax  purposes  constitutes  a  partial  subsidy  of our  withholding  tax
obligation and that, therefore,  a United States Holder would not be entitled to
a foreign tax credit with respect to the amount so allowed.  However, this Dutch
tax credit is allowed  only to us and does not reduce the amount of  withholding
tax applied  against the  dividends  paid by us. We believe that such a position
would not be correct  because  such Dutch  credit is based  primarily on the net
dividend received and the United States Holder does not receive any benefit from
such Dutch tax credit allowable to us.                                          

Subject to the discussion  below under "Backup  Withholding  Tax and Information
Reporting  Requirements,"  a Non-United  States  Holder of common shares or ADSs
generally will not be subject to United States federal income or withholding tax
on  dividends  received  on  common  shares  or  ADSs,  unless  such  income  is
effectively  connected  with the conduct by such  Non-United  States Holder of a
trade or business in the United States.                                         

Sale or Exchange of Common Shares or ADSs                                       
A United  States Holder  generally  will  recognize  gain or loss on the sale or
exchange  of common  shares or ADSs equal to the  difference  between the amount
realized on such sale or exchange and the United  States  Holder's  adjusted tax
basis in the common  shares or ADSs.  Such gain or loss will be capital  gain or
loss. In the case of a noncorporate  United States Holder,  the maximum marginal
United States federal income tax rate applicable to such gain will be lower than
the  maximum  marginal  United  States  federal  income tax rate  applicable  to
ordinary  income if such United States  Holder's  holding period for such common
shares or ADSs exceeds one year and will not be further  reduced if such holding
period exceeds five years.  Gain or loss, if any,  recognized by a United States
Holder  generally  will be treated as United  States  source  income or loss for
United States foreign tax credit purposes.  The  deductibility of capital losses
is subject to limitations.                                                      

Subject to the discussion  below under "Backup  Withholding  Tax and Information
Reporting  Requirements,"  a Non-United  States  Holder of common shares or ADSs
generally will not be subject to United States federal income or withholding tax
on any gain  realized  on the sale or  exchange  of such  common  shares or ADSs
unless  (i)  such  gain  is  effectively  connected  with  the  conduct  by such
Non-United  States Holder of a trade or business in the United States or (ii) in
the case of any gain realized by an individual  Non-United  States Holder,  such
holder is present in the United  States for 183 days or more in the taxable year
of such sale or exchange and certain other conditions are met.                  

Backup Withholding Tax and Information Reporting Requirements                   
United States backup  withholding  tax and  information  reporting  requirements
generally apply to certain  payments to certain  noncorporate  holders of stock.
Information  reporting  generally will apply to payments of dividends on, and to
proceeds from the sale or  redemption  of, common shares or ADSs made within the
United  States to a holder  of common  shares  or ADSs  (other  than an  "exempt
recipient"  which  is a payee,  including  a  corporation,  that is not a United
States  person that  provides an  appropriate  certification  and certain  other
persons).  A payor will be required to withhold 31% of any payments of dividends
on, or the proceeds from the sale or redemption of, common shares or ADSs within
the United States to a holder (other than an "exempt  recipient") if such holder
fails to furnish its correct taxpayer  identification  number or otherwise fails
to comply with,  or establish an exemption  from,  such backup  withholding  tax
requirements.                                                                   

In the case of such payments  made within the United States to a foreign  simple
trust, a foreign grantor trust or a foreign  partnership (other than payments to
a foreign simple trust, a foreign  grantor trust or a foreign  partnership  that
qualifies  as  a  "withholding   foreign   trust"  or  a  "withholding   foreign
partnership"  within the meaning of such United States Treasury  Regulations and
payments  to a  foreign  simple  trust,  a  foreign  grantor  trust or a foreign
partnership  that  are  effectively  connected  with the  conduct  of a trade or
business in the United States),  the  beneficiaries of the foreign simple trust,
the persons  treated as the owners of the foreign  grantor trust or the partners
of the foreign partnership,  as the case may be, will be required to provide the
certification  discussed  above in order to establish  an exemption  from backup
withholding tax and information  reporting  requirements.  Moreover,  a payor or
middleman may rely on a  certification  provided by a payee that is not a United
States person only if such payor or middleman does not have actual  knowledge or
a  reason  to  know  that  any  information  or  certification  stated  in  such
certificate is incorrect.                                                       

The above summary is not intended to  constitute a complete  analysis of all tax
consequences relating to acquisition, ownership and disposition of common shares
or ADSs.  Holders of common shares or ADSs should consult their own tax advisors
concerning the tax consequences of their particular situations.                 

Material Contracts                                                              

We were not party to any material  contracts,  outside of our ordinary course of
business.                                                                       

Documents on Display                                                            

Copies of the annual reports on Form 20-F of Royal Ahold and documents  referred
to within this Form 20-F and the Articles of Association as well as the Articles
of   Association   of  the   Aministratiekantoor   and  the   trust   conditions
("Administratievoorwaarden")  will be available for  inspection  upon request at
the Corporate  Office of Royal Ahold at Albert Heijnweg 1, 1507 EH Zaandam,  The
Netherlands (tel. +31-75-659-5625).                                             

ITEM 11.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK            

The  following   discussion  about  our  risk  management   activities  includes
"forward-looking  statements"  that  involve  risk and  uncertainties  which are
discussed  more  fully in Item 3 - "Key  Information  - Risk  Factors  Affecting
Financial  Condition  and  Operating  results".   Actual  results  could  differ
materially from those projected in the forward-looking statements.              

Overview                                                                        

Our primary market risk exposures  include  exchange rate movements and interest
rate  fluctuations.  We actively  review and monitor our  exposure to changes in
exchange  rates and  interest  rates.  To manage  foreign  exchange  transaction
exposure and interest rate exposure,  we from time to time enter into derivative
financial  instruments.  The derivative  financial  instruments that we utilize,
while  appropriate  for hedging a particular  kind of risk,  are not  considered
specialized or high-risk and are generally  available from numerous sources.  We
do not enter into  contracts or utilize  derivative  financial  instruments  for
speculative  purposes,  and the contracts into which we enter are generally of a
duration that is consistent with the anticipated  related underlying  exposures.
Gains and losses from derivative  financial  instruments  that are designated as
and  deemed to be  effective  hedges  are  deferred  and are  recognized  in the
statement of earnings when the hedged  transactions  occur;  gains and losses on
instruments  that  are  not  designated  as  and  deemed  effective  hedges  are
recognized  immediately into earnings.  Our use of financial instruments and its
accounting  policies for financial  instruments are described more fully in note
21 to the consolidated financial statements.                                    

Financial Instruments                                                           

Long-term debt                                                                  
The following table identifies our long-term indebtedness, including capitalized
lease  commitments,  by  currency  and type of  interest.  The  majority  of the
borrowings  indicated  below  are fixed or have been  fixed  through  the use of
interest rate swaps.                                                            

                                                        [Enlarge/Download Table]


                                            Fixed Interest  Floating Interest      Total           Total    
                                                 2000             2000             2000            1999     
                                                 ----             ----             ----            ----     
Long-term debt and capital leases denominated in:                                                           
                                                                                                            
   U.S. dollars                              USD 5,117,201    USD  1,343,822   EUR 6,855,917   EUR 3,078,075
   Euros                                     EUR 2,311,496    EUR    526,363   EUR 2,837,859   EUR 1,471,281
   Other                                     EUR   125,318    EUR    480,894   EUR   606,212   EUR   107,836
                                                                                     -------        ------- 

Total                                                                          EUR 10,299,988  EUR 4,657,192
                                                                                   ==========      =========

Foreign currency exchange contracts                                             
As of the end of fiscal 2000,  we had numerous  insignificant  foreign  exchange
forward  contracts  outstanding,  which  are used to hedge  future  payments  in
foreign  currencies  made to  suppliers  by our  operating  companies.  To hedge
exposures related to loans and leases in foreign  currencies we had 29 swaps and
cross currency swaps  outstanding as of the end of fiscal 2000,  with a notional
amount  outstanding  of EUR  1,678  million.  Of  those 29  contracts,  19 had a
maturity of shorter  than one year,  and 10 had  maturities  ranging from two to
five years. Also, of those 29 contracts, 16 hedge USD/BRL exposure,  seven hedge
USD/EUR exposure,  three hedge SEK/NOK  exposure,  and in total three derivative
contracts are used to hedge THB/EUR, CZK/EUR and DKK/SEK exposure.              

Interest rate swaps and other interest rate derivatives                         
As of the end of fiscal 2000, we had nine interest rate derivatives outstanding.
Of those nine, four are NLG denominated interest rate swaps, with a total amount
outstanding of EUR 218 million. These contracts expire between 2002 and 2004. In
three of these swaps we pay a floating  (Euribor)  rate and receive a fixed rate
(total  notional  amount  outstanding of EUR 172 million).  In one swap we pay a
fixed rate and receive a floating  (Euribor) rate with a total  notional  amount
outstanding  of  EUR  45  million.  We  also  had  three  dollar  interest  rate
derivatives outstanding,  of which one is an exercised swaption, in which we pay
a fixed rate and receive a floating  (LIBOR) rate,  with a total notional amount
outstanding  of $129  million.  We also had one  written  payers  interest  rate
swaption,  with a total notional  amount  outstanding  of $200 million,  and one
bought interest rate cap (LIBOR based) with a total notional amount  outstanding
of $100 million.  The last two interest rate derivatives are a CZK interest rate
collar with a total notional amount outstanding of CZK 900 million and a Forward
Rate Agreement in SEK (SEK 1.2 billion). Both are used to hedge outstanding debt
in those currencies.                                                            

Sensitivity Analysis                                                            

Interest rates                                                                  
The  following  analysis  sets  out the  sensitivity  of the  fair  value of our
financial  instruments  to  selected  changes in  interest  rates.  Fair  values
represent the present value of forecasted future cash flows at the market rates.
The sensitivity  analysis  assumes an immediate 10% change in interest rates for
all our financial  instruments  from their levels as of December 31, 2000,  with
all other variables held constant.                                              

                                                        [Enlarge/Download Table]


                                                         As of fiscal year end 2000                          
                                  ---------------------------------------------------------------------------
                                                                               Sensitivity analysis          
                                                                        -------------------------------------
                                        Carrying              Fair          Fair value at     Fair value at  
                                         Amount               Value             + 10 %             -10 %     
                                        --------              ------           ------             -----      
                                                  (All amounts are stated in thousands of euro)              
                                                                                                             
Liabilities                                                                                                  
Long-term debt                          (10,299,988)       (10,445,372)      (10,195,993)      (10,712,108)  

Derivative financial instruments                                                                             
Currency derivatives                             --            (71,829)          (77,037)          (68,556)  
Interest rate derivatives                        --             (6,155)           (5,713)           (4,154)  
                                                 ---            -------           -------           -------  

Total                                   (10,299,988)       (10,523,356)      (10,278,743)      (10,784,818)  
                                        ============       ============      ============      ============  

Foreign currency exchange rates                                                 
The  following  analysis  sets  out the  sensitivity  of the  fair  value of our
financial  instruments  to  selected  changes in  exchange  rates.  Fair  values
represent the present value of forecast future cash flows at the market exchange
rates.  The sensitivity  analysis assumes an immediate 10% change in all foreign
currency  exchange  rates  against  the euro from their  levels as of the end of
fiscal 2000, with all other variables held constant.  A +10% change  indicates a
strengthening   of  the  currency  in  which  our  financial   instruments   are
denominated,  primarily the dollar, against the euro and a -10% change indicates
a weakening of the currency in which our financial  instruments are denominated,
primarily the dollar, against the euro.                                         

                                                        [Enlarge/Download Table]


                                                         As of fiscal year end 2000                          
                                  ---------------------------------------------------------------------------
                                                                               Sensitivity analysis          
                                                                        -------------------------------------
                                      Carrying               Fair           Fair value at     Fair value at  
                                       Amount               Value               +10%              -10%       
                                      --------              -----               ----              ----       
                                                (All amounts are stated in thousands of euro)                
                                                                                                             
Liabilities                                                                                                  
Long-term debt                         (10,299,988)        (10,445,372)      (11,283,071)       (9,607,672)  

Derivative financial instruments                                                                             
Currency derivatives                            --             (71,829)         (257,782)          (80,754)  
Interest rate derivatives                       --              (6,155)           (4,155)           (6,362)  
                                                ---             -------           -------           -------  

Total                                  (10,299,988)        (10,523,356)      (11,545,008)       (9,694,788)  
                                       ============        ============      ============       ===========  

Based on similar  analyses  related to our market  exposures in fiscal 1999,  no
significant changes in our market exposures were identified.                    

ITEM 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES                 

Not applicable.                                                                 

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PART II                                                                         

ITEM 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES                        

None                                                                            

ITEM 14.  MATERIAL  MODIFICATIONS  TO THE RIGHTS OF SECURITY  HOLDERS AND USE OF
PROCEEDS                                                    

For a discussion of changes in the voting rights of  shareholders  in accordance
with Article 29 of the Articles of Association,  as amended on October 10, 2000,
please see Item 10 - "Voting rights".                                           

ITEM 15                                                                         

[Reserved]                                                                      

ITEM 16                                                                         

[Reserved]                                                                      

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PART III                                                                        

ITEM 17. FINANCIAL STATEMENTS                                                   

Not applicable.                                                                 

ITEM 18. FINANCIAL STATEMENTS                                                   

Index of Consolidated Financial Statements                                      

                                                                    Page
Independent Auditors' Report                                             64     

Consolidated Statements of Earnings for fiscal years 2000,                      
1999 and 1998                                                            65     

Consolidated Balance Sheets as of December 31, 2000 and                         
January 2, 2000                                                          66     

Consolidated Statements of Cash Flows for fiscal years 2000,                    
1999 and 1998                                                            68     

Consolidated Statements of Shareholders' equity for fiscal                      
years 2000, 1999 and 1998                                                69     

Notes to the Consolidated Financial Statements                           70     

Our condensed  consolidated  financial  statements  prepared under U.S. GAAP are
presented in note 23 to the consolidated financial statements.                  

Schedules are omitted because, under applicable rules, the omitted schedules are
not required,  are inapplicable or the information  required therein is included
in the financial statements or in the notes thereto.                            

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Independent Auditors' Report                                                    

To the Supervisory Board and Shareholders of Koninklijke Ahold N.V.:            

We have audited the  accompanying  Consolidated  balance  sheets of  Koninklijke
Ahold  N.V.  as of  December  31,  2000 and  January  2,  2000  and the  related
consolidated  statements  of earnings,  shareholders'  equity and cash flows for
each of the three fiscal years in the period ended December 31, 2000,  expressed
in euros.  These  consolidated  financial  statements are the  responsibility of
Koninklijke Ahold N.V.'s management. Our responsibility is to express an opinion
on the financial statements based on our audits.                                

We conducted our audits in accordance with auditing standards generally accepted
in The Netherlands and the United States.  Those standards  require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatements. An audit includes examining, on a
test basis,  evidence  supporting  the amounts and  disclosures in the financial
statements.  An audit also includes assessing the accounting principles used and
significant  estimates  made by  management,  as well as evaluating  the overall
financial  statement  presentation.   We  believe  that  our  audits  provide  a
reasonable basis for our opinion.                                               

In our opinion, the Consolidated  financial statements referred to above present
fairly,  in all  material  respects,  the  Consolidated  financial  position  of
Koninklijke  Ahold N.V.  as of  December  31,  2000 and  January 2, 2000 and the
results of its operations,  changes in its equity and its cash flows for each of
the three fiscal years in the period ended December 31, 2000, in conformity with
generally accepted accounting principles in The Netherlands.                    

As discussed in note 1 to the financial  statements,  in 2000 Koninklijke  Ahold
N.V.  changed  its  method of  accounting  to reflect  dividends  payable on the
balance  sheet upon  approval  of the Annual  General  Meeting of  Shareholders,
rather  than  when  proposed,  and  retroactively  restated  the 1999  financial
statements  for the  change.  As further  discussed  in note 1 to the  financial
statements, effective January 2, 2000, Koninklijke Ahold N.V. changed its method
of  accounting to reflect the  capitalization  of certain costs for internal use
software and effective December 2000,  Koninklijke Ahold N.V. changed its method
of accounting to capitalize purchased goodwill.                                 

Generally  accepted  accounting  principles in The  Netherlands  vary in certain
significant respects from generally accepted accounting principles in the United
States.  The application of the latter would have affected the  determination of
net earnings for each of the three fiscal years in the period ended December 31,
2000 and the  determination of shareholders'  equity as of December 31, 2000 and
January 2, 2000 to the extent summarized in Note 23.                            

Deloitte & Touche                                                               
Accountants                                                                     

March 6, 2001 (April 9, 2001 as to note 22)                                     

Amsterdam, The Netherlands                                                      

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                                                        [Enlarge/Download Table]


Consolidated Statements of Earnings of Royal Ahold                                                              
(All amounts, except per share amounts, are expressed in thousands of   fiscal 2000   fiscal 1999   fiscal 1998 
Euros. Amounts reported for fiscal 1998 have been converted from Dutch  ------------  ------------  ----------- 
guilders to euros at the fixed rate of EUR 1 = NLG 2.20371)                                                     
                                                                                                                

Net Sales                                                                52,470,832    33,560,391    26,484,210 
Cost of sales                                                           (40,583,717)  (25,206,346)  (20,295,007)
                                                                        ------------  ------------  ------------

Gross Profit                                                             11,887,115     8,354,045     6,189,203 
Selling expenses                                                         (7,905,310)   (5,806,134)   (4,413,052)
General and administrative expenses                                      (1,707,712)   (1,133,239)     (758,885)
                                                                         -----------   -----------     ---------

Operating Results                                                         2,274,093     1,414,672     1,017,266 

Interest income                                                              87,021        58,589        76,358 
Interest expenses                                                          (808,990)     (420,820)     (319,479)
Exchange rate differences                                                    51,542        (6,479)       (1,877)
Other financial income                                                        1,162         2,516             0 
Net financial expense                                                        ------        ------           --  
                                                                           (669,265)     (366,194)     (244,998)
                                                                           ---------     ---------     ---------

EARNINGS BEFORE INCOME TAXES AND MINORITY INTERESTS                       1,604,828     1,048,478       772,268 

Income taxes                                                               (401,010)     (283,001)     (197,075)
                                                                           ---------     ---------     ---------

EARNINGS AFTER TAXES AND BEFORE MINORITY INTERESTS                        1,203,818       765,477       575,193 
Income from unconsolidated companies                                         14,562         7,437        11,105 
Minority interests                                                         (102,389)      (20,807)      (39,099)
                                                                           ---------      --------      --------

NET EARNINGS                                                              1,115,991       752,107       547,199 
                                                                          =========       =======       ======= 

Appropriation of net earnings:                                                                                  
Retained earnings and reserves                                              592,164       424,031       299,133 
Proposed dividend common shares                                             506,383       315,909       238,141 
Dividend cumulative preferred financing shares                               17,444        12,167         9,925 
                                                                             ------        ------         ----- 

                                                                          1,115,991       752,107       547,199 
                                                                          =========       =======       ======= 

Net earnings after preferred dividends                                    1,098,547       739,940       537,274 

Weighted average number of common shares outstanding (x 1,000)              729,825       650,564       592,715 

Earnings per common share                                                      1.51          1.14          0.91 
Diluted earnings per common share                                              1.47          1.11          0.90 

SEE NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS.                                                             

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Consolidated Balance Sheets of Royal Ahold                                      
(Before appropriation of current year results)                                  
(All amounts, except share and per share amounts,                               
are expressed in thousands of euros)                   December 31,   January 2,
                                                        2000          2000
                                                        ----          ----
ASSETS                                                                          

Current assets                                                                  
Cash and cash equivalents (Note 3)                     1,335,592      887,592   
Receivables (Note 4)                                   3,426,151    1,696,748   
Inventories (Note 5)                                   4,100,223    2,552,323   
                                                    --------- -  ---------

                                                    8,861,966    5,136,663

Fixed assets                                                                    
Tangible fixed assets, net of depreciation (Note 6)                             
Buildings and land                                  6,855,938    4,377,756
Machinery and equipment and other                   4,730,821    3,408,379
Under construction                                    645,892      607,563
                                                      ------- -    -------

                                                   12,232,651    8,393,698

Loans receivable (Note 7)                                414,055      208,357   
Investments in unconsolidated companies (Note 8)         407,843      132,035   
Intangible fixed assets (Note 9)                       3,152,688      291,201   
Deferred income taxes (Note 17)                          391,421      123,688   
                                                      ------- -    -------

                                                   16,598,658    9,148,979

TOTAL ASSETS                                          25,460,624   14,285,642   
                                                   ==========   ==========

SEE NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS.                             

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Consolidated Balance Sheets of Royal Ahold (continued)                          

(All amounts, except share and per share amounts, are expressed in thousands of 
euros)                                                 December 31,   January 2,
                                                    2000          2000
                                                    -----         ----

LIABILITIES AND SHAREHOLDERS' EQUITY                                            

Current liabilities                                                             
Loans payable (Note 10)                                2,355,345     1,312,320  
Taxes payable                                            551,185       447,514  
Accounts payable                                       5,185,432     2,860,584  
Accrued expenses                                       1,533,244       869,397  
Other current liabilities (Note 11)                      595,654       364,135  
                                                       -------- -    -------

                                                    10,220,860     5,853,950

Long-term liabilities                                                           
Subordinated loans (Note 12)                           1,779,907       859,914  
Other loans (Note 12)                                  7,183,514     2,713,975  
                                                     ---------  -  ---------
                                                     8,963,421     3,573,889

Capitalized lease commitments (Note 13)                1,336,567     1,083,303  
Deferred income taxes (Note 17)                          362,949       102,793  
Other provisions (Note 14)                             1,396,882       983,794  
                                                     ---------  -    -------

                                                    12,059,819     5,743,779

Minority interests                                       677,379       336,048  

Shareholders' equity (Note 15)                                                  
Cumulative preferred shares--EUR 500 par value;                                 
    authorized--800,000 shares; issued--none                    --            --
Cumulative preferred financing shares--EUR 0.25                                 
par value; authorized--400,000,000 shares;                              
outstanding in 2000--259,317,164 shares and                             
  in 1999--144,000,000 shares                           64,829        32,672

Common shares--EUR 0.25 par value; authorized--                                 
1,200,000,000 shares; outstanding in 2000                               
--816,849,445 shares and in 1999--                                      
  646,484,126 shares                                   204,213       146,681

Additional paid-in capital                             8,675,969     4,224,505  
Revaluation reserve                                       26,124        30,221  
Reserve shareholdings                                     14,589         1,600  
Reserve for exchange rate differences                    (85,270)      (60,552) 
General reserve                                       (6,397,888)   (2,023,162) 
                                                     ----------- - -----------

                                                     2,502,566     2,351,865

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY            25,460,624    14,285,642  
                                                    ==========-   ==========

SEE NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS.                             

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Consolidated Statements of Cash Flows of Royal Ahold                            

                                                        [Enlarge/Download Table]


(All amounts are expressed in thousands of euros. Amounts reported for 1998     fiscal year  fiscal year  fiscal year
have been converted from Dutch guilders to euros at the fixed rate of EUR 1 =       2000         1999         1998   
NLG 2.20371)                                                                       -----         -----        ----   
                                                                                                                     
Cash flows from operating activities                                                                                 
Net earnings                                                                     1,115,991      752,107      547,199 
Adjustments to reconcile to net cash from operating activities                                                       
Minority interests in earnings                                                     102,389       20,807       39,099 
Depreciation and amortization                                                    1,181,699      868,123      672,991 
Result divestments of subsidiaries                                                      --        1,847           -- 
Unremitted earnings of unconsolidated companies                                    (10,948)      (3,255)      (6,827)
Changes in assets and liabilities providing (using) cash (excluding                                                  
   assets and liabilities acquired):                                                                                 
   Receivables                                                                    (170,970)     (45,709)    (241,401)
   Inventories                                                                    (324,171)    (256,343)     (52,133)
   Other current liabilities                                                       796,644      512,012      221,004 
   Deferred income taxes                                                           205,638      (37,309)      52,695 
   Other provisions                                                               (196,393)     (82,286)      25,068 
                                                                                  ---------     --------      ------ 
Net cash provided by operating activities                                        2,699,879    1,729,994    1,257,695 

Cash flows from investing activities                                                                                 
Purchase of tangible fixed assets                                               (2,468,956)  (1,732,798)  (1,319,514)
Purchase of intangible assets                                                     (181,109)     (30,853)     (26,426)
Sale or disposal of tangible fixed assets                                          436,999      149,828      143,616 
Acquisitions of consolidated subsidiaries                                       (9,074,309)    (699,846)  (3,069,231)
Acquisitions of interests in unconsolidated companies                              (58,377)     (18,493)     (31,220)
Sales of subsidiaries                                                                4,163       20,898       21,305 
                                                                                     ------      -------      ------ 
Net cash used in investing activities                                          (11,341,589)  (2,311,264)  (4,281,470)

Cash flows from financing activities                                                                                 
Net proceeds from issuance of common shares                                      4,090,668           --    2,181,640 
Net proceeds from issuance of cumulative preferred financing shares                394,894           --       73,035 
Net proceeds from issuance of convertible subordinated notes                       920,000           --      678,402 
Convertible subordinated notes converted into shares                                     6           --           -- 
Net proceeds from exercised stock options                                           55,585       20,836       36,480 
Additional capital contributions from minority shareholders                         29,374      325,872       77,679 
Proceeds from long-term debt                                                    10,063,810    1,375,118    1,217,512 
Repayments of long-term debt                                                    (7,040,266)  (1,106,920)    (961,016)
Repayments of capitalized lease commitments                                        (83,557)     (53,043)     (38,539)
Change in short-term loans payable                                                 454,391      339,463       70,526 
Issuance of loans receivable                                                      (206,457)     (58,203)     (76,725)
Repayments of loans receivable                                                      93,568       69,425       82,914 
Payment of dividend on common shares                                               (43,856)     (34,522)     (16,651)
Payment of dividend on cumulative preferred financing shares                       (12,135)     (11,971)      (8,326)
                                                                                   --------     --------      -------
Net cash provided by  financing activities                                       8,716,025      866,055    3,316,931 

Effects of changes in exchange rates on cash                                       (43,110)      44,184     (128,872)
                                                                                   --------      -------    ---------

Net increase in cash and cash equivalents                                           31,205      328,969      164,284 

Cash and cash equivalents at beginning of the year                                 887,592      519,395      297,093 
Cash brought in through acquisitions and new consolidations                        416,795       39,228       58,018 
                                                                                   -------      -------      ------  

Cash and cash equivalents at end of the year                                     1,335,592      887,592      519,395 
                                                                                 =========      =======      ======= 

Supplemental cash flow information                                                                                   
   Income taxes paid                                                               213,219      145,832      316,655 
   Interest paid, net of amounts capitalized                                       658,827      397,832      307,947 
   Capitalized lease commitments incurred                                          237,352      181,441      130,588 

SEE NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS.                                                                  


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Consolidated Statements of Shareholders' Equity of Royal Ahold                  

                                                        [Enlarge/Download Table]


(All amounts are expressed in                                                                                                
thousands of euros. Amounts reported                                                                                         
for 1998  have been converted from                                                                                           
Dutch guilders to euros at the fixed                                                      Reserve                            
rate of EUR 1 = NLG 2.20371)                       Additional                           for exchange                         
                                          Share    paid-in    Revaluation     Reserve        rate       General              
                                          Capital  capital      reserve    Shareholdings differences    reserve      Total   
                                          -------  ---------- -----------  ------------- -------------  --------   ----------
                                                                                                                             
Balance as of December 28, 1997           145,802  1,946,065    58,384        1,907       (92,001)     (535,087)   1,525,070 
Net earnings                                   --         --        --           --            --       547,199      547,199 
Dividend on 1998 cumulative preferred                                                                                        
  financing shares                             --         --        --           --            --        (9,925)      (9,925)
Common shares issued as dividend            3,504    (3,504)        --           --            --       (16,651)     (16,651)
Common shares issued from exercise of                                                                                        
  option rights                               861     35,619        --           --            --            --       36,480 
Common shares issued                       19,569  2,162,071        --           --            --            --    2,181,640 
Cumulative preferred financing shares                                                                                        
  issued                                    5,445     67,590        --           --            --            --       73,035 
Goodwill paid                                  --         --        --           --            --    (2,362,476)  (2,362,476)
Changes in valuation                           --         --    (5,710)        (313)           --        (2,981)      (9,004)
Exchange rate differences in foreign                                                                                         
  interests                                    --         --        --           --      (245,733)        4,129     (241,604)
                                          -------  ---------    ------       ------       --------    ----------   ----------
Balance as of January 3, 1999             175,181  4,207,841    52,674        1,594      (337,734)   (2,375,792)   1,723,764 
Net earnings                                   --         --        --           --            --       752,107      752,107 
Dividend on 1999 cumulative preferred                                                                                        
   financing shares                            --         --        --           --            --       (12,167)     (12,167)
Common shares issued as final optional                                                                                       
stock dividend 1998                         2,480    (2,480)        --           --            --       (22,504)     (22,504)
Common shares issued as interim optional                                                                                     
   stock dividend 1999                      1,258    (1,258)        --           --            --       (12,019)     (12,019)
Common shares issued from exercise of                                                                                        
   option rights                              434     20,402        --           --            --            --       20,836 
Goodwill paid                                  --         --        --           --            --      (372,847)    (372,847)
Changes in valuation                           --         --   (22,453)           6            --        19,211       (3,236)
Exchange rate differences in foreign                                                                                         
  interests                                    --         --        --           --       277,182           749      277,931 
                                          -------  ---------    ------       ------       --------    ----------   ----------
Balance as of January 2, 2000             179,353  4,224,505    30,221        1,600       (60,552)   (2,023,262)   2,351,865 
                                         ========  =========    ======        =====       ========   ===========   ========= 
Net earnings                                   --         --        --           --            --     1,115,991    1,115,991 
Dividend on 2000 cumulative preferred                                                                                        
  financing shares                             --         --        --           --            --       (17,444)     (17,444)
Common shares issued as final optional                                                                                       
  stock dividend 1999                       2,607    (2,607)        --           --            --       (25,285)     (25,285)
Common shares issued as interim optional                                                                                     
   stock dividend 2000                      1,515    (1,515)        --           --            --       (18,571)     (18,571)
Common shares issued from exercise of                                                                                        
   option rights                              747     54,838        --           --            --            --       55,585 
Goodwill paid                                  --         --        --           --            --    (5,416,328)  (5,416,328)
Changes in valuation                           --         --    (4,097)      12,989            --       (12,989)      (4,097)
Change in nominal value EUR 0.25           21,309   (21,309)        --           --            --            --           -- 
Common shares issued                       34,682  4,055,986        --           --            --            --    4,090,668 
Preferred shares issued                    28,829    366,065        --           --            --            --      394,894 
Shares issued upon conversion of                                                                                             
  subordinated convertible notes               --          6        --           --            --            --            6 
Exchange rate differences in foreign           --         --        --           --                                          
  interests                                    --         --        --           --       (24,718)          ....     (24,718)
                                          -------  ---------    ------       ------       --------    ----------   ----------

BALANCE AS OF DECEMBER 31, 2000           269,042  8,675,969    26,124       14,589       (85,270)   (6,397,888)   2,502,566 
                                          =======  =========    ======       ======       ========   ===========   ========= 


SEE NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS                              

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Notes to the Consolidated financial statements                                  

Note 1     Significant accounting policies                                      

Company's business                                                              
Royal Ahold's ("Ahold" or the "Company")  principal activity is the operation of
retail  trade  supermarkets  both  in  the  United  States  and in  Europe  with
additional   activities  in  several  potential  growth  markets.   Such  retail
operations   are  primarily   conducted   through  the  following   consolidated
subsidiaries or partnerships:                                                   

     Region                                             Number of stores
                                                      as of December 31,
                                                                    2000
United States:                                                
       Stop & Shop                                                   274
       Giant-Carlisle                                                 96
       BI-LO                                                         422
       Tops                                                          342
       Giant-Landover                                                179
Europe:                                                       
The Netherlands--Albert Heijn:                            
          Company owned                                              508
          Franchised                                                 201
The Netherlands--Schuitema:                               
          Company owned                                              128
          Associated                                                 423
Scandinavia:                                              
          Company owned                                              375
          Franchised or Associated                                 2,725
       Portugal--Jeronimo Martins Retail, SGPS, S.A.                 210
       The Czech Republic--Ahold Czech Republic A.S.                 190
       Poland--Ahold  Polska  Sp. z o.o.                             149
       Spain--Ahold SuperMercados S.L.                               582

Royal Ahold also operates food retail  stores in other  regions  throughout  the
world.  Such retail  operations  are primarily  conducted  through the following
consolidated subsidiaries or partnerships:                                      

           Region                                             Number of stores
                                                            as of December 31,
                                                                          2000
Latin America:                                          
Brazil--Bompreco S.A. Supermercados do              
             Nordeste                                                106
          Argentina--Disco S.A.                                      235
          Chile--Santa Isabel S.A.                                    96
          Guatemala - La Fragua S.A.                                 130
Asia Pacific:                                           
          Malaysia--Royal Ahold - Perlis (Tops) Sdn. Bhd.             39
          Thailand--CRC Ahold Company Ltd.                            41

Royal Ahold also  operates  foodservice  activities  in the United  States,  The
Netherlands and Sweden.  In April 2000,  Royal Ahold acquired U.S.  Foodservice,
the second largest food service distributor in the United States,  based on 2000
net sales.  In Europe,  Royal Ahold conducts food service through Deli XL in The
Netherlands and through Menyforetagen in Sweden.                                

Royal Ahold has three  wholly-owned  real estate  affiliates,  Ahold Real Estate
Company,  Inc.  ("ARC")  and Ahold Real  Properties  LLC.  ("ARP") in the United
States and Ahold Vastgoed B.V. ("AVG") in The Netherlands. These three companies
are engaged in the  financing,  development  and  management  of store sites and
shopping centers primarily in support of Royal Ahold's retail operations.       

Consolidation                                                                   

The financial statements of Royal Ahold presented herein, and the notes thereto,
are prepared on a consolidated  basis in conformity with Dutch GAAP.  Generally,
all companies in which Royal Ahold can exercise control or where Royal Ahold has
a  direct  or  indirect   interest  of  more  than  50%  are   included  in  the
consolidation.  All  significant  intercompany  transactions  and  accounts  are
eliminated in consolidation.                                                    

Comparability  of the  financial  statements  with those  included in the Annual
Report of Royal Ahold                                                           

The  financial  statements  and related  notes of Royal Ahold  presented  herein
differ in certain  respects  from the  financial  statements  and related  notes
presented in the printed English  language  version of the 2000 Annual Report of
Royal Ahold.  The principal  differences  are  reclassifications  within certain
financial statement categories,  terminology changes and additional  disclosures
have been  provided in order to present these  financial  statements in a format
more customary to readers of U.S. annual reports.                               

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Basis of accounting                                                             

The  valuation  of  assets,   liabilities  and  shareholders'   equity  and  the
determination  of earnings are based on historical  cost,  except for AVG's 1988
revaluation of its real estate holdings and its related subsequent effects.     

Change in accounting principles                                                 

Starting  fiscal  2000,  the proposed  dividend on common  shares is included in
shareholders'  equity  until  final  approval of the Annual  General  Meeting of
Shareholders.  In prior years, the proposed  dividend was included in short term
liabilities.  Previous  years  have  been  restated  to  facilitate  comparison.
Effective January 2, 2000, certain costs relating to software developed in-house
or purchased for internal use have been  capitalized  and will be amortized over
the  anticipated  useful life. In accordance  with Dutch  Accounting  Principles
published in November 2000,  goodwill paid for acquisitions  since then has been
capitalized. Amortization takes place according to the straight-line method over
the  anticipated  useful  life of the asset  over a maximum  period of 20 years.
Goodwill paid until November 2000 was fully charged to shareholders'  equity. An
amount of EUR 2.6 billion was capitalized in the balance sheet at year-end 2000,
of which EUR 5.2 million was amortized in the results of 2000.                  

Fiscal year                                                                     

Royal Ahold's fiscal year generally  consists of 52 weeks and ends on the Sunday
nearest  to  December  31.  Fiscal  year  2000  contained  52 weeks and ended on
December 31, 2000.  Fiscal year 1999  contained 52 weeks and ended on January 2,
2000 and fiscal year 1998 contained 53 weeks and ended on January 3, 1999.      

Foreign exchange                                                                

Transactions,  receivables  and  liabilities  denominated in foreign  currencies
resulting from ordinary  activities  are  translated at the prevailing  rates of
exchange.  The  resulting  exchange  rate  differences  are added or  charged to
operating results. Exchange rate differences resulting from financing activities
are recorded in net financial expenses.                                         

In the consolidation,  subsidiaries' balance sheets whose functional currency is
other than euros are  translated at the rates of exchange  prevailing at the end
of the fiscal  year;  the amounts in the  subsidiaries'  statements  of earnings
denominated  in currencies  other than euros are  translated  per quarter at the
quarter's average rate of exchange.  The resulting exchange rate differences are
added or charged directly to shareholders'  equity.  On a cumulative  basis, the
aggregate  amount  of  foreign   exchange  rate   differences   charged  against
shareholders' equity was EUR 85 million as of December 31, 2000.                

Prior to fiscal 1999,  the Company  utilized the Dutch  guilder as its reporting
currency, however, beginning in fiscal 1999, Royal Ahold adopted the euro as its
reporting  currency.  As part of the  introduction  of the euro  throughout  the
European  Union,  the exchange rate between the legacy  currencies  and the euro
were fixed on January 1, 1999.  Accordingly,  the historic financial  statements
and related  disclosures  that were  reported  using the Dutch guilder have been
converted  to the euro using the fixed  conversion  rate of EUR 1 = NLG 2.20371.
The conversion of the  historical  financial  statements  from Dutch guilders to
euro at a fixed rate depicts the same trends as would have been  presented if we
would have continued to present our financial statements in Dutch guilders.  The
rates of exchange (dollar per euro) applied for the dollar are as follows:      

                                                      fiscal    fiscal    fiscal
                                                        year      year      year
                                                        2000      1999      1998
Balance Sheet                                                                   
Year-end rate                                         0.9424    1.0075    1.1685

Statement of Earnings                                                           
1st quarter                                           0.9790    1.1092    1.0746
2nd quarter                                           0.9313    1.0446    1.0918
3rd quarter                                           0.8941    1.0570    1.1163
4th quarter                                           0.8696    1.0329    1.1748

The  effect  of  changes  in  currencies  other  than the  dollar  have not been
material.                                                                       

Receivables/Loans receivable                                                    

Receivables and loans receivables are recorded at face value less provisions for
uncollectible   amounts.   Project   financing   represents   advances  for  the
construction  of  projects  that are to be sold upon  their  completion  and are
generally leased back.                                                          

Inventories                                                                     

Inventories  are stated at the lower of historical  cost or  manufacturing  cost
based on the first-in, first-out ("FIFO") method or market value.               

Tangible fixed assets                                                           

Tangible  fixed  assets are  stated at cost less  accumulated  depreciation  and
amortization. Depreciation is calculated using the straight-line method based on
the estimated useful lives of the related assets.  In the case of capital leases
and leasehold improvements,  the estimated useful lives of the related assets do
not exceed the remaining term of the  corresponding  leases.  Assigned  economic
lives of Royal Ahold's tangible fixed assets are as follows:                    

Category                                            Assigned  economic life   
 Buildings                                                   30-40 years
Machinery and equipment (primarily  distribution                      
   and  production  facilities)                                  8 years
Other fixed assets (including renovations and                         
   store equipment)                                            5-8 years

Interest  incurred  during  construction  is  capitalized as part of the related
asset, and totaled EUR 18 million,  EUR 15 million, and EUR 13 million in fiscal
years 2000, 1999 and 1998, respectively.  The amount recorded for buildings also
includes  capitalized  leases for real estate  (located  primarily in the United
States).                                                                        

Investments in unconsolidated companies                                         

Royal Ahold participates in certain joint ventures and partnerships,  as well as
maintains investments in other companies. Royal Ahold consolidates all companies
over which it exercises  control,  as evidenced by majority ownership or through
control  of   management.   Companies   over  which  Royal  Ahold  can  exercise
considerable  influence in terms of business  and  financial  policy,  and where
Royal Ahold owns more than a 20%  interest,  are  accounted for using the equity
method.  Other  unconsolidated  companies are stated at  historical  cost unless
there is a permanent decline in value.                                          

Intangible fixed assets                                                         

Goodwill  including  any necessary  restructuring  provisions as a result of the
acquisitions  of companies was charged  directly to  shareholders'  equity up to
December 2000. As of December 2000 goodwill was  capitalized  and amortized on a
straight  line basis over a maximum  period of 20 years.  The "lease  interests"
primarily  represent the  discounted  value of the  difference  between the fair
rental value and the contractual  rents due on leases as recorded at the time of
the  acquisition  of a business  or takeover of such  leases.  These  discounted
intangible  assets  are  amortized  over  the  remaining  length  of  the  lease
agreements on a straight-line  basis.  Effective January 2, 2000,  certain costs
relating to software  developed in-house or purchased for internal use have been
capitalized  and will be amortized  over the  anticipated  life of three to five
years.  The software  capitalized  in previous  years is also  transferred  from
tangible fixed assets to intangible fixed assets in 2000.                       

Recoverability of long-lived assets                                             

In evaluating useful lives and carrying values of long-lived assets, Royal Ahold
reviews  certain  indicators  of  potential  impairment,  such as  profitability
projections that incorporate the impact on existing company  businesses.  In the
event that an impairment  seems  likely,  the fair value of the related asset is
determined,  and Royal Ahold records a charge to earnings based on comparing the
asset's  carrying value to the estimated fair value.  Historically,  Royal Ahold
has generated sufficient returns from acquired businesses to recover the cost of
assets, including intangible assets.                                            

Taxes payable                                                                   

Taxes  payable  include  income taxes (net of investment  credits),  value added
taxes,  payroll  taxes and other taxes which are  expected to be paid within one
year.                                                                           

Revaluation reserve                                                             

In October 1988, a one-time  revaluation of certain relevant real estate held by
AVG was recorded. Royal Ahold added the difference between market value and book
value, net of deferred taxes, to a revaluation reserve in shareholders'  equity.
The revalued  amounts are amortized on a straight-line  basis over the remaining
estimated life of the related real estate.                                      

Income taxes/Deferred income taxes                                              

Income taxes are determined  based on the earnings  reported in the Consolidated
Statement of Earnings,  adjusted for  permanent  differences  between  income as
calculated for financial and tax reporting purposes at the prevailing tax rates.

Deferred   income  tax  assets  and   liabilities  are  derived  from  temporary
differences  between the financial  and tax reporting of assets and  liabilities
and from loss carryforward facilities available and are included under "Deferred
income taxes". Netting of deferred tax assets and liabilities occurs on a fiscal
unity basis.                                                                    

Deferred tax assets and liabilities are based on the tax rates prevailing at the
end of the fiscal year. A valuation allowance is established, when necessary, to
reduce  deferred  tax assets to the amount  that is more  likely  than not to be
realized based on available evidence.                                           

Use of estimates                                                                

The preparation of Royal Ahold's consolidated financial statements in conformity
with  generally  accepted  accounting  principles  requires  management  to make
estimates  and  assumptions  that  affect  the  reported  amounts  of assets and
liabilities  and disclosure of contingent  assets and liabilities at the balance
sheet dates and  reported  amounts of revenue and  expense  during the  reported
periods. Actual results could differ from those estimates.                      

Revenue recognition                                                             

Royal Ahold recognizes retail sales at the point of sale. Sales to franchise and
associated  stores  and food  supply  revenues  are  recognized  when  goods are
delivered. Vendor allowances and credits that relate to the company's buying and
merchandising activity are recognized as earned.                                

Advertising                                                                     

Royal Ahold recognizes  advertising  expenses as incurred.  Advertising expenses
totaled EUR 553  million,  EUR 327  million and EUR 261 million in fiscal  years
2000, 1999 and 1998, respectively.                                              

Earnings per share                                                              

The  calculation  of earnings per common share is based on the weighted  average
number of shares  outstanding  during  the  fiscal  year.  The  number of shares
outstanding is retroactively  adjusted for stock  dividends.  The calculation of
diluted  net  earnings  per common  share is  calculated  based on the  weighted
average number of common shares  outstanding,  inclusive of the number of shares
that would have been issued upon conversion of all dilutive common shares,  such
as  convertible  subordinated  notes and the exercise of employee  stock options
outstanding.                                                                    

Amounts in thousands of euros                                                   

Unless  indicated   otherwise,   all  amounts  included  in  the  notes  to  the
consolidated financial statements are stated in thousands of euros.             

Reclassifications                                                               

Certain  reclassifications  have been made to prior year financial statements to
conform to the current year presentation.                                       

Note 2     Business acquisitions and investments                                

During  fiscal years 2000,  1999 and 1998,  we completed  the  acquisitions  and
partnership  investments  set forth  below.  The store  counts  indicated  below
represent  the  number of stores  operated  at the time of  acquisition,  unless
otherwise indicated.                                                            

o    Superdiplo:  On September 7, 2000,  Royal Ahold  announced plans to acquire
     all of the  outstanding  shares of the Spanish food  retailer,  Superdiplo,
     S.A. by means of a public tender offer. Superdiplo operates over 300 stores
     in Southern  Spain,  Andalusia,  the Canary  Islands and the greater Madrid
     region as well as two stores in Northern  Morocco.  On  September  7, 2000,
     Royal Ahold also  announced  that it had signed an  agreement  with several
     major  shareholders  of Superdiplo  holding in the aggregate  69.16% of the
     outstanding  shares of Superdiplo in which the major  shareholders  agreed,
     pursuant  to  the  terms  of the  tender  offer,  tender  their  shares  in
     Superdiplo  at a rate of 0.74  common  shares  of  Royal  Ahold  for  every
     Superdiplo share held, subject to certain adjustments. Also on September 7,
     2000, Royal Ahold's Corporate Executive Board authorized a capital increase
     of up to 42,207,000 new common shares to be used as  consideration  for the
     tendered Superdiplo shares. On November 25, 2000 Royal Ahold launched Royal
     Ahold's public tender offer for the  outstanding  shares in Superdiplo.  On
     December  27,  2000,  the tender offer was closed and on December 29, 2000,
     Royal Ahold  issued  36,849,875  Royal Ahold common  shares.  On January 3,
     2001,  Royal Ahold exchanged the 36,849,875 newly issued Royal Ahold common
     shares  for  49,797,129  Superdiplo  shares,  representing  97.64%  of  the
     outstanding  share  capital  in  Superdiplo.  Superdiplo  shareholders  who
     tendered  their shares  received  0.74 new common  shares of Royal Ahold in
     exchange  for  every  Superdiplo  share  tendered.  The  balance  sheet  of
     Superdiplo  was  consolidated  as of year end 2000, as Royal Ahold obtained
     beneficial  ownership  on  December  29,  2000,  but none of the  operating
     results are included in our  consolidated  statement of earnings for fiscal
2000.                                                                 

o    PYA/Monarch:  In December 2000, U.S. Foodservice  completed its acquisition
     of  PYA/Monarch,  a food service  distributor  in the  southeastern  United
     States for a total  cash  consideration  of  approximately  $1.57  billion.
PYA/Monarch was previously a subsidiary of Sara Lee Corporation.      

o    The A&P Group: In September 2000,  Schuitema  acquired the A&P Group in The
Netherlands with 123 supermarkets and six hypermarkets.               

o    Bompreco:  In June 2000,  Royal Ahold acquired the remaining  voting rights
from the other shareholders of Bompreco in Brazil.                    

o    Peapod:  In June 2000, Royal Ahold acquired series B convertible  preferred
     stock and  warrants  to acquire  common  stock of the U.S.  on-line  grocer
     Peapod,  Inc. Each share of preferred stock entitles the holder to the vote
     that the holder  would be  entitled  to cast had the holder  converted  the
     preferred  stock  into  common  stock.  In  addition,  the  holders  of the
     preferred  stock  have  voting  rights  relating  to  the  election  of the
     directors.  The preferred stock was convertible into shares of common stock
     that,  after  giving  effect to such  conversion,  would  have  represented
     approximately 51% of Peapod's outstanding common stock. The warrants issued
     in June 2000, along with warrants Royal Ahold acquired from Peapod in April
     2000,  in  consideration  of a revolving  credit  facility that Royal Ahold
     provided to Peapod,  enable Royal Ahold to buy additional  shares of common
     stock. In October 2000,  Royal Ahold purchased  2,331,917  shares of Peapod
     common stock in an open market  transaction.  In October 2000,  Royal Ahold
     exchanged the series B convertible preferred stock for series C convertible
     preferred  stock of Peapod  which is  convertible  into the same  number of
     shares of common  stock as the series B  convertible  preferred  stock.  If
     Royal Ahold were to convert all of the preferred  stock to common stock and
     exercise all of the  warrants,  its  beneficial  ownership of Peapod common
     stock would represent approximately 78.9% of Peapod's outstanding stock. In
     September 2000,  Peapod acquired various assets of  Streamline.com,  a U.S.
     on-line  shopping and delivery  service  based in Westwood,  Massachusetts.
     Peapod paid  approximately  $12 million for the Washington,  D.C./Baltimore
     area  facilities  of  Streamline,  which  are  expected  to be  used in the
development of Giant-Landover's internet-based home delivery services.

o    The ICA Group:  In April  2000,  Royal  Ahold  acquired  a 50%  partnership
     interest in ICA, the largest Scandinavian food retailer,  for approximately
     EUR 1.8 billion in cash.  ICA was formed in early 1999 when ICA AB acquired
     an additional 55% of Norway's Hakon Gruppen AS, which became a wholly owned
     subsidiary.  In August  1999,  ICA entered  into a  non-consolidated  50/50
joint-venture with Statoil.                                           

o    U.S. Foodservice: In April 2000, Royal Ahold acquired U.S. Foodservice, the
     second  largest food service  distributor  in the United  States,  based on
     sales  for  approximately   $3.6  billion,   including  the  assumption  of
     approximately  $925  million in debt.  In July  2000,  GFG  Foodservice,  a
     broadline  distributor in North Dakota, South Dakota and northern Minnesota
was acquired by U.S. Foodservice.                                     

o    Kampio:  In January 2000,  Royal Ahold acquired the Catalonian  supermarket
chain Kampio, based in Barcelona.                                     

o    Ekono:  In  January  2000,   Royal  Ahold  acquired  Ekono  with  10  large
supermarkets in Buenos Aires.                                         

o    La Fragua: In December 1999, Royal Ahold  established a 50/50  partnership,
     Paiz Ahold, which controls an 80.5% interest in La Fragua, the largest food
     retailer in Guatemala.  Royal Ahold  completed  this  agreement in December
     1999  and,  as a result,  the  assets  and  liabilities  of La  Fragua  are
     reflected in its  consolidated  balance sheet at the end of fiscal 1999 but
     none of the operating results are included in its consolidated statement of
earnings for fiscal 1999.                                             

o    Supamer and Gonzalez:  In May 1999, through Royal Ahold's 50/50 partnership
     with Velox Retail Holdings,  Disco Ahold International Holdings acquired 75
stores from Supamer and Gonzalez.                                     

o    Gastronoom:  In  July  1999,  Royal  Ahold  acquired  Gastronoom,  a  Dutch
     institutional food supplier, for EUR 152 million including interest-bearing
     debt. In July 1999,  Gastronoom  was combined  with Royal Ahold's  existing
     food service company in The Netherlands,  Grootverbruik  Ahold to form Deli
XL.                                                                   

o    Dialco, Dumaya, Guerrero and Castillo del Barrio: Throughout 1999, in Spain
     Royal Ahold acquired  several  companies for an aggregate amount of EUR 118
million in cash.                                                      

o    Giant-Landover:  In October 1998,  Royal Ahold acquired  Giant Food,  which
     operated 179 supermarkets in the Mid-Atlantic  region of the United States,
for $2.7 billion in cash.                                             

o    Disco and Santa Isabel:  In January  1998,  Royal Ahold  established  Disco
     Ahold International  Holdings,  or DAIH, a 50% owned partnership with Velox
     Retail  Holdings.  DAIH  currently  controls a 99.3% stake in Disco.  Royal
Ahold paid approximately $538 million to acquire its interest in DAIH.

The  above  acquisitions  have  been  accounted  for by the  purchase  method of
accounting.  The purchase price has been  allocated  based on the estimated fair
values of the assets acquired and the liabilities  assumed. As discussed in Note
1 to the  consolidated  financial  statements,  under Dutch GAAP,  any resulting
goodwill  was  immediately  charged  to  shareholders'  equity  in the  year  of
acquisition  until November  2000. As of December 2000,  goodwill is capitalized
and  amortized on a straight line basis over a maximum  period of 20 years.  The
operating  results of all acquisitions are normally included in the Consolidated
Statements of Earnings from the dates of their  respective  acquisitions.  Under
U.S. GAAP, goodwill of approximately EUR 7,972 million and approximately EUR 373
million in 2000 and 1999,  respectively,  was recorded as an intangible asset to
reflect the excess of the purchase  price over the  estimated  fair value of the
net assets acquired.                                                            

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The unaudited pro forma combined  financial  data,  prepared in accordance  with
Dutch GAAP, as set forth below, give effect to:                                 

o        the acquisition of U.S. Foodservice;                                   
o        the acquisition of the 50% partnership interest in ICA;                
o        the acquisition of PYA/Monarch; and                                    
o        the acquisition of Superdiplo.                                         

We have prepared the unaudited pro forma  information  as it these  acquisitions
occurred at the beginning of fiscal 2000 and fiscal 1999, respectively.         

                                                        [Enlarge/Download Table]


                                                                fiscal 2000  fiscal 1999
                                                                (unaudited)  (unaudited)
                                                                -----------  -----------
                                                                                        
Net sales                                                        61,166,937   50,118,453
Operating results                                                 2,504,166    1,922,468
Net earnings                                                      1,169,265      887,673
Net earnings after preferred dividend                             1,151,821      875,506
Weighted average number of common shares outstanding (x 1,000)      807,283      780,504
Earnings per common share                                              1.43         1.12


The pro forma information  included above is provided for illustrative  purposes
only and does not purport to represent what the actual  operating  results would
have been had the  transactions  occurred on the respective  dates assumed.  All
historical  figures  shown are actual or, for  purposes of  comparison  restated
fiscal  2000 and 1999  numbers.  The  purchase  price paid for all  transactions
reflects  future growth  expectations  and is not based on historical  data. The
unaudited  pro forma  combined  earnings  data do not  reflect  the  anticipated
synergies from actual  integration into Royal Ahold and stand alone improvements
in operating  results.  With regard to the  remaining  acquisitions  referred to
elsewhere  in note 2,  since  the pro  forma  impact  of these  acquisitions  on
revenue,  earnings  before  interest,  taxes  and  extraordinary  items  and net
earnings would not be materially different from the historical  information,  no
pro forma information has been furnished in respect of them.                    

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NOTE 3     Cash and cash equivalents                                            
                                                      December 31,    January 2,
                                                      2000            2000
                                                      -----------     ----------

          Cash and cash equivalents                  1,090,680         444,193
          Interest bearing cash and time deposits      244,912         443,399
                                                       -------         -------

                                                     1,335,592         887,592
                                                     =========         =======

           Reported  amounts as  of December 31, 2000  include  restricted  cash
           of  EUR  38.6  million,  relating  to  required  deposits for certain
pension fund agreements.                                  

           Items   reported  as  cash  have  an  original  maturity of less than
three months.                                             

NOTE 4     Receivables                                                          

                                                     December       January 2,
                                                     31, 2000             2000
                                                     --------       ----------
          Trade receivables                          1,833,231         891,273
Receivables from unconsolidated                           
            subsidiaries and affiliates                 30,800              --
          Income tax receivable                         18,034           4,561
          Other receivables                          1,113,181         453,539
          Prepaid expenses                             465,182         355,987
          Project financing                            111,694          84,010
                                                       -------          ------
                                                     3,572,122       1,789,370
           Allowances for doubtful receivables         (145,971)        (92,622)
                                                      ---------      ---------

                                                     3,426,151       1,696,748
                                                     =========       =========

           As of year end 2000, we sold trade  receivables  to third parties for
           an  amount   of  EUR  438   million   under   securitization arrange-
ments. We retain the credit risk for these receivables.   

NOTE 5    Inventories                                                         

                                                       December       January 2,
                                                      31, 2000            2000
                                                       --------       ----------
         Raw materials and components                 13,966          12,991
Finished products and merchandise                         
          inventories                              4,160,001       2,549,922
         Other inventories                            98,596          62,639
                                                      ------          ------
                                                   4,272,563       2,625,552
          Allowances for obsolete inventories        (172,340)        (73,229)
                                                    ---------       --------

                                                   4,100,223       2,552,323
                                                   =========       =========

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Note 6     Tangible fixed assets                                                

                                                        [Enlarge/Download Table]


                                           Buildings and Land      Machinery                   Under                
                                          Stores         Other     equipment      Other     construction    Total   
                                         ----------    ---------   ----------  -----------    -------    -----------
                                                                                                                    
Cost, Jan. 2, 2000                       4,558,960      794,632    2,138,677    4,072,004     607,563    12,171,836 
         Accumulated depreciation         (804,473)    (171,363)    (802,833)  (1,999,469)         --    (3,778,138)
                                         ----------    ---------   ----------  -----------    -------    -----------
         Net book value, Jan. 2, 2000    3,754,487      623,269    1,335,844    2,072,535     607,563     8,393,698 

         Additions                         716,322      331,279      574,858      923,766     (77,269)    2,468,956 
         Capitalized leases                234,098           --        2,428          826          --       237,352 
         Assets brought in through                                                                                  
         acquisitions                      857,750      790,108      176,157      496,765      80,775     2,401,555 
         Book value of assets sold or                                                                               
         disposed and                                                                                               
         reclassifications                (293,483)     (52,116)     (30,665)     (40,304)     (6,675)     (423,243)
         Depreciation                     (165,025)     (61,975)    (254,482)    (639,959)         --    (1,121,441)
         Exchange rate differences         118,888        2,336       51,007       62,045      41,498       275,774 
                                         ----------    ---------   ----------  -----------    -------    -----------
         Net book value, Dec. 31, 2000   5,223,037    1,632,901    1,855,147    2,875,674     645,892    12,232,651 
                                         =========    =========    =========   ==========     =======    ========== 

         Cost, Dec. 31, 2000             6,258,398    2,097,935   3,065,747     5,726,875     645,892    17,794,847 
         Accumulated depreciation       (1,035,361)    (465,034)  (1,210,600)  (2,851,201)         --    (5,562,196)
                                         ----------    ---------   ----------  -----------    -------    -----------
         Net book value, Dec. 31, 2000   5,223,037    1,632,901    1,855,147    2,875,674     645,892    12,232,651 
                                         =========    =========    =========   ==========     =======    ========== 

         As of December 31, 2000,  the  aggregate  amounts of mortgage and other
         loans  collateralized  by real estate were EUR 146.2 million.  The book
         values of mortgaged real estate at December 31, 2000 exceed the amounts
due under the related loans or secured liabilities.           

         As of December 31, 2000, Royal Ahold had purchase commitments for fixed
assets outstanding of approximately EUR 312.9 million.        

         Net book value for fiscal year 1999  includes the  reclassification  of
         software from tangible fixed assets to intangible assets, in the amount
of EUR 81.3 million.                                          

Note 7     Loans receivable                                                     

                                                 December 31,   January 2,
                                                   2000         2000
                                                 ------------   ----------
      Employee loans, floating interest               106,724       63,913
      Other loans issued                              236,297      104,491
      Loans due from unconsolidated companies          71,034       39,953
                                                      -------      -------
                                                      414,055      208,357
                                                      =======      =======

          Employee  loans  include  EUR 55.8  million as of  December  31,  2000
          (January  2,  2000:  EUR 61.7  million)  of loans  due from  Officers,
          managers and employees which were granted to assist these Officers and
          employees with investments in the AH Dutch Customer Fund (the "Fund").
          These  floating-rate  loans,  bearing  interest  based  on  the  Dutch
          interest  rate,  are  generally due ten years from issuance or upon an
          individual's   termination   of  employment,   if  earlier,   and  are
          collateralized  by each individual's  corresponding  investment in the
          Fund. Loans to Corporate  Executive Board members were EUR 0.9 million
as of December 31, 2000 (January 2, 2000: EUR 0.9 million). 

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Note 8     Investments in unconsolidated subsidiaries and affiliates            
                                                          December    January 2,
                                                         31, 2000         2000
                                                          --------    ----------
  Beginning of fiscal year:                              132,035       123,229

  Brought in through acquisitions                        219,373         3,964
  Investments and increase in existing shareholdings      58,750        14,542
   Sale and settlement of shareholdings                    (4,163)      (12,891)
   Other movements                                           (373)       (6,466)
  Exchange rate differences                               (8,727)        6,402
  Income from unconsolidated subsidiaries and affiliates  14,562         7,437
   Dividend                                                (3,614)       (4,182)
                                                           -------       -------
   End of fiscal year:                                     407,843       132,035
                                                           =======       =======

Note 9   Intangible fixed assets                                                

                                                        [Enlarge/Download Table]


                                                                       Other            
                                                         Lease    intangible            
                                    Goodwill  Software  interest fixed assets    Total  
                                    --------  --------  -------- ------------    -----  
                                                                                        
Beginning of fiscal year:                                                               
At cost                                 --    123,810   166,872     106,442     397,124 
Accumulated amortization                --    (32,846)  (33,861)    (39,216)   (105,923)
                                        --    -------   -------     -------     ------- 
Book value                              --     90,964   133,011      67,226     291,201 

Additions                        2,556,269     92,838    18,231      70,040   2,737,378 
Brought in through acquisitions    286,819      1,419     1,154      12,833     302,225 
Divestments                             --    (13,617)   (5,156)     (5,669)    (24,442)
Amortization                        (5,236)   (31,730)   (8,640)    (14,652)    (60,258)
Exchange rate differences         (106,867)     2,835    10,113         503     (93,416)

End of fiscal year:                                                                     
At cost                          2,735,823    182,131   193,453     172,054   3,283,461 
Accumulated amortization            (4,838)   (39,422)  (44,740)    (41,773)   (130,773)
                                    -------   --------  --------    --------   ---------
Book value                       2,730,985    142,709   148,713     130,281   3,152,688 
                                 =========    =======   =======     =======   ========= 

Note 10   Loans payable                                                       

                                                           December   January 2,
                                                         31, 2000       2000
                                                           --------   ----------

   Bank overdrafts                                       1,025,723       708,387
   Borrowings, current portion                             247,588       191,948
   Customer savings                                        289,182        44,979
   Capitalized lease commitments, current portion           74,720        62,092
   Ahold Dutch Customer Fund Loan                          192,475       179,627
   Other loans                                             525,657       125,287
                                                         ---------     ---------
                                                         2,355,345     1,312,320

  Other  loans   consist of  savings  stamps,  held by Albert  Heijn  customers,
employees' savings accounts and short term debt.                            

Note 11   Other current liabilities                                           

                                                        December    January 2,
                                                       31, 2000         2000
                                                        --------   -----------

         Vacation allowances                           339,130       263,726
         Interest                                      223,844        73,681
         Pension funds                                  21,732        21,089
         Dividends                                      10,948         5,639
                                                       -------       -------
                                                       595,654       364,135
                                                       =======       =======

Effective  fiscal  2000 , the  proposed  dividend  payable  on common  shares is
included  in  shareholders'   equity  and  not  in  other  current  liabilities.
Stockholders' equity and current liabilities are restated for fiscal year 1999. 

Note 12    Borrowings                                                           

                                                        [Enlarge/Download Table]


                                                                         December    January 2,
                                                                         31, 2000       2000   
                                                                         --------    ----------
                                                                                               
Subordinated loans at fixed rates:                                                             
NLG 200 million 7.625% bonds, maturing in 2000                                --      90,756   
NLG 200 million 6.75% bonds, maturing in 2003                             90,756      90,756   
NLG 200 million 5.875% bonds, maturing in 2005                            90,756      90,756   

Convertible subordinated notes:                                                                
NLG 1,495 million 3.0% convertible subordinated notes, maturing in       678,395     678,402   
2003 EUR 920 million 4.0% convertible subordinated notes, maturing in    920,000          --   
2005                                                                                           

Credit facilities:                                                                             
$1 billion, multi-currency facility, floating interest                   720,738     153,846   
$500 million, multi-currency facility, floating interest                 530,560          --   
SEK 5,000 million, multi-currency facility, floating interest            241,138          --   

Other loans at fixed rates unless otherwise noted:                                             
NLG 300 million eurobonds, 5.875%                                        136,134     136,134   
NLG 500 million eurobonds, 6.25%                                         226,890     226,890   
NLG 100 million loan, 7.70%                                               36,302      45,378   
NLG 70 million loan, 7.20%                                                31,765      31,765   
$500 million 6.25% bonds                                                 530,560     496,279   
$500 million 6.875% bonds                                                530,560     496,279   
$250 million  9.75% senior loan                                          212,198     203,331   
$39 million 6.11% loan                                                    41,384      38,710   
$50 million 6.23% loan                                                    53,056      49,628   
$39 million loan LIBOR plus 70 bps (1)                                    41,384      38,710   
$250 million 9.875% bond                                                 140,135     148,884   
$100 million 9.125% bond                                                  32,932      34,740   
EUR 1,500 million 6.375% bond                                          1,500,954          --   
EUR 200 million 6.375% bond                                              200,000          --   
EUR 66 million floating rate note                                         66,000          --   
$700 million 8.25% bond                                                  742,784          --   
CZK 3,000 million floating rate note                                      84,604          --   
76 other loans, average 7.37%                                          1,025,252     484,169   
39 mortgage loans, average 7.35%                                         125,811      94,300   
Portuguese Escudo bonds, average 4.37%                                   124,700     167,069   
Brazilian Real bonds, average 13.90%                                      55,261      59,811   
                                                                       ---------   ---------   
                                                                       9,211,009   3,856,593   

Cash held in escrow                                                           --     (90,756)  
Current portion                                                         (247,588)   (191,948)  
                                                                       ---------   ---------   
Long-term portion of loans                                             8,963,421   3,573,889   
                                                                       ==========  =========   

----------                                                                      
(1) The LIBOR rate as of December 31, 2000 was 6.0%.                            

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As of December 31, 2000,  maturities  of long-term  debt during each of the next
five fiscal years and thereafter are as follows:                                
2001                                   247,588            
2002                                   998,741            
2003                                 1,891,120            
2004                                   126,638            
2005                                 2,944,184            
Thereafter                           3,002,738            
                         ---------
                         9,211,009
                         =========
Subordinated loans                                                              

Repayment of the principal of these  subordinated  loans is  subordinated to the
claims of all other  existing and future  creditors.  In fiscal year 1999,  cash
proceeds  were held in escrow  with a bank to be used when the bonds  matured in
2000. This bond was repaid on January 11, 2000.                                 

Convertible subordinated notes                                                  

In September 1998,  Royal Ahold completed a public offering of NLG 1,495 million
principal  amount of its 3.0%  convertible  subordinated  notes  due 2003,  with
interest  payable  annually,  commencing  September  30,  1999.  Holders  of the
convertible  subordinated  notes have the right to convert the notes into common
shares of Royal Ahold at any time prior to September  25,  2003.  On October 26,
2000, the conversion  price changed from EUR 28.06 to EUR 27.82 per common share
of EUR 0.25. At any time after  September 30, 2001,  the notes are redeemable at
the option of Royal Ahold,  in whole but not in part,  at the  principal  amount
thereof,  together with accrued interest. The notes will mature on September 30,
2003.                                                                           

In May 2000, Royal Ahold issued 4% convertible  subordinated  notes due in 2005,
with a  principal  amount of EUR 920  million.  Holders of these  notes have the
right to convert the notes into  common  shares of Royal Ahold at any time prior
to May 16, 2005.  On October 26, 2000,  the  conversion  price  changed from EUR
33.02 to EUR 32.74 per common  share of EUR 0.25.  Royal  Ahold has the right to
redeem the convertible  notes in whole but not in part, at the principal  amount
there of, together with accrued interest at any time after May 19, 2003.        

Credit facilities                                                               

In  December   1996,   Royal  Ahold   entered  into  a  $1  billion   seven-year
multi-currency revolving credit facility bearing interest at LIBOR plus 10 basis
points. Royal Ahold pays a facility fee of 10 basis points per year on the total
amount of the facility through the fifth year. Thereafter, the facility fee will
be 11.25 basis points per year.  This facility  agreement  contains  restrictive
covenants  with  regard to  maintenance  of certain  financial  ratios,  such as
interest coverage and gearing, as defined.                                      

In March 1998, Royal Ahold entered into a four-year $500 million  multi-currency
revolving credit facility  bearing  interest at LIBOR plus 10 basis points.  The
terms and  conditions  of this  facility  are  substantially  identical to Royal
Ahold's existing $1 billion multi-currency revolving credit facility.           

The  proceeds of the bonds issued by Ahold  Finance USA Inc.  were first used in
June 2000 and then again in July 2000 to repay the  majority of the  outstanding
amount  under  the  $1  billion   multi-currency   revolving   credit  facility.
Subsequently, the facility was used for other corporate activities including the
financing of PYA/Monarch.                                                       

On July 7, 2000 ICA  Finance  AB  entered  into a five  year SEK  5,000  million
multi-currency  revolving  credit  agreement,  bearing interest at a fluctuating
interest rate.                                                                  

On December 7, 2000,  Croesus Inc.,  entered into a $300 million bridge facility
and on  December  18,  2000  Royal  Ahold  entered  into a $500  million  bridge
facility. Under the latter facility, Ahold Finance USA Inc. can issue short-term
EMTN's at a guaranteed  margin.  Both  facilities were used for the financing of
the acquisition of PYA/Monarch. The outstanding loans under these facilities are
included in short term bank loans and will be refinanced on a long term basis in
the first half of year 2001.                                                    

Other loans (at fixed rates unless otherwise indicated)                         
NLG 300 million eurobonds,  5.875%.  These 10-year eurobonds have been issued by
Albert Heijn B.V., and are guaranteed by Royal Ahold. Matures December 19, 2007.

NLG 500 million  eurobonds,  6.25%.  These 10-year eurobonds have been issued by
Croesus Inc. and are guaranteed by Royal Ahold. Matures November 28, 2006.      

NLG 100 million  loan,  7.70%.  This loan was issued by AVG,  and has  principal
repayment due in five equal  installments  of NLG 20 million  starting June 2000
through June 2004.                                                              

NLG 70  million  loan,  7.20%.  This loan was  issued  by AVG,  and  matures  in
September 2003.                                                                 

$500 million  bonds,  6.25%.  These  10-year  bonds were issued by Ahold Finance
U.S.A. Inc. and are guaranteed by Royal Ahold. Matures May 1, 2009              

$500 million  bonds,  6.875%.  These  30-year bonds were issued by Ahold Finance
U.S.A. Inc. and are guaranteed by Royal Ahold. Matures May 1, 2029.             

$250 million senior loan,  9.75%.  This senior loan was issued by Stop & Shop in
February 1992.  Matures July 1, 2002.  This loan is  subordinated  to all senior
indebtedness of Stop & Shop.                                                    

$39 million loan,  6.11%. This loan was issued by Croesus Inc. and is guaranteed
by Royal Ahold. Matures June 30, 2003.                                          

$50 million loan,  6.23%. This loan was issued by Croesus Inc. and is guaranteed
by Royal Ahold. Matures June 30, 2006.                                          

$39 million  loan,  LIBOR plus 70 bps. This loan was issued by Tops in a private
placement, guaranteed by Royal Ahold. Matures March 15, 2002.                   

$250 million bond, 9.875%. This bond was issued by Disco.  Matures May 15, 2008.
Of the total principal amount of this bond, $118 million is held by Ahold Belgie
N.V.                                                                            

$100 million bond, 9.125%. This bond was issued by Disco.  Matures May 15, 2003.
Of the total principal  amount of this bond, $69 million is held by Ahold Belgie
N.V.                                                                            

EUR 1,500 million  bond,  6.375%.  This bond was issued by Ahold Finance  U.S.A.
Inc. and is guaranteed by Royal Ahold.  Matures June 8, 2005. This bond has been
swapped to a USD liability of $1,414 million at an interest rate of 8.547%.     

EUR 200  million  bond,  6.375%.  This bond was issued by Royal  Ahold.  Matures
November 30, 2007.                                                              

EUR 66 million floating rate note. This note was issued by Royal Ahold.  Matures
October 26, 2007.                                                               

$700 million bond,  8.257%.  This bond was issued by Ahold Finance U.S.A.  Inc.,
and is fully and  unconditionally  guaranteed  by Royal Ahold.  Matures July 15,
2010.                                                                           

Note 13    Capitalized lease commitments                                        

Capital  leases are  principally  for buildings and are generally  held by Royal
Ahold's U.S.  subsidiaries.  Terms typically range from ten to twenty-five years
and contain renewal options.  Components of assets held under capital leases are
as follows:                                                                     

                                                December    January 2,
                                               31, 2000         2000
                                             ---------     ---------

   Land and buildings                        1,552,846     1,250,242
   Machinery and equipment                      98,286        40,108
                                             ---------     ---------
                                             1,651,132     1,290,350
    Accumulated amortization                   (516,006)     (391,964)
                                             ---------     ---------
                                             1,135,126       898,386
                                             =========       =======

At the time of entering  into capital  lease  agreements,  the  commitments  are
recorded at present  value using the  interest  rate  applicable  for  long-term
borrowings.  As of December 31, 2000, existing lease commitments are recorded at
present value equivalent to an average rate of 8.97% (9.02% at January 2, 2000).

As of December 31, 2000,  the aggregate  amounts of minimum lease payments under
capitalized  lease  contracts  payable in each of the next five fiscal years and
thereafter are as follows:                                                      

     2001                                                        197,174
     2002                                                        183,649
     2003                                                        180,294
     2004                                                        174,064
     2005                                                        168,440
     Thereafter                                                1,703,100
                                                               ---------
     Total future minimum lease payments                       2,606,721
      Estimated executory costs                                    (3,391)
      Amounts representing interest                            (1,192,043)
                                                               ---------
     Present value of net minimum capital lease payments       1,411,287
      Current portion                                             (74,720)
                                                               ---------
     Long-term portion of capitalized lease commitments        1,336,567
                                                               =========

Total  future  minimum  lease  payments  above have not been  reduced by minimum
sublease  rentals of EUR 14.7  million as of December 31, 2000 due in the future
under related non-cancelable subleases.                                         

Note 14    Other provisions                                                     

The movements in provisions in 2000 were:                                       

                                                        [Enlarge/Download Table]


Other provisions                     Beginning                                                                  
----------------                      of fiscal                                       Exchange rate    End of   
                                        year     Acquisitions  Additions  Deductions  differences    fiscal year
                                     ---------   ------------  ---------  ----------  -------------- ---------- 
                                                                                                                
Pension provisions                     218,116    111,616        70,273     (68,443)     3,016       334,578    
Loss reserves for self-insurance       268,833     10,125       221,229    (185,085)    17,008       332,110    
Closed and divested facilities         186,054    133,125        10,892     (85,685)     8,883       253,269    
Severance and other personnel costs     79,298     68,889        30,480     (80,186)     (880)        97,601    
Bankruptcy guarantees                   31,298         --         1,698     (10,435)        --        22,561    
Conversion costs                        25,301         --            --     (11,193)        --        14,108    
Maintenance provisions                  51,917        307         7,523     (29,492)       288        30,543    
Straight line rent                      31,804         --         6,379      (1,642)     2,030        38,571    
Other                                   91,173    241,578        15,457     (88,163)    13,496       273,541    
                                       -------    -------       -------    ---------    ------     ---------    
                                       983,794    565,640       363,931    (560,324)    43,841     1,396,882    
                                       =======    =======-      =======    =========    ======     =========    

Pension provisions relate to various defined benefit plans, both in the U.S. and
The  Netherlands,  including  supplemental  plans  for early  retirement  in The
Netherlands.                                                                    

Royal Ahold is  self-insured  for property,  casualty,  medical,  disability and
general liability costs. Royal Ahold determines its liabilities for self-insured
claims based on an independent actuarial analysis.                              

The provision for closed and divested facilities represents the estimated future
costs  (principally for rent obligations and loss on the disposal of assets) for
facilities,  primarily  retail stores,  that have been closed or announced to be
closed.                                                                         

Severance and other  personnel  costs include  severance  benefits for employees
whose  employment  will be terminated.  Bankruptcy  guarantees  represent  lease
obligations  related to  properties  operated by  Bradlees,  Inc.  ("Bradlees").
Bradlees stores were sold by Stop & Shop in 1992; however,  Stop & Shop remained
obligated under  approximately  102 of its leases  assigned to Bradlees  stores.
Bradlees stores filed for bankruptcy  protection  under Chapter 11 of the United
States  Bankruptcy  Code in 1995  and on  February  2,  1999  emerged  from  the
bankruptcy.  In  December  2000,  Bradlees  Stores  again  filed for  bankruptcy
protection under Chapter 11 in order to facilitate the wind-down and liquidation
of its assets.  S&S/B Lease Disposition LLC ("S&S/B"),  which is wholly owned by
Stop & Shop, has been involved in a litigation arising from an appeal by Vornado
Realty Trust,  which is a landlord with respect to some of the Bradlees  leases,
from a Bankruptcy Court decision  approving a Lease  Designation and Disposition
Agreement  between Bradlees Stores and New Horizons of Yonkers,  Inc.  (together
with Bradlees Stores  collectively  "Bradlees") and S&S/B dated January 11, 2001
(the "Disposition  Agreement").  S&S/B and Bradlees entered into the Disposition
Agreement to provide for the sale and  disposition  of all of the Bradlees  real
property  leases,  including  certain  leases  under  which Stop & Shop may have
potential liability.  Under the agreement,  which was approved by the Bankruptcy
Court  following  a hearing on January  30,  2001,  S&S/B  will  guarantee  that
Bradlees  receives at least $150  million  from the  proceeds of the sale of the
leases.  S&S/B may purchase some of the Bradlees  leases,  subject to an auction
process  where other  parties  would be entitled to submit bids. As of March 30,
2001, 33 of the Bradlees  leases have been  purchased.  On February 9, 2001, the
United States  District  Court for the Southern  District of New York upheld the
Bankruptcy  Court's  decision to deny Vornado  Realty  Trust's  challenge to the
Disposition Agreement, except for the Bankruptcy Court's decision to allow S&S/B
and  Bradlees to allocate  future  rental  increases  under the Vornado  leases.
Neither  Bradlees nor Vornado is expected to appeal this decision.  In addition,
S&S/B does not intend to appeal this  decision.  The  provision  for  bankruptcy
guarantees  represents  the  estimated  future lease costs which Royal Ahold may
incur for Bradlees  stores based on available  information.  Total future rental
payments under all such assigned Bradlees leases aggregated  approximately  $143
million as of December 31, 2000. However, Royal Ahold believes that such ongoing
contingent  liability  will not be  material  or have a  material  impact on the
Company's future financial condition or operating results.                      

Conversion  costs  represent  the  expected  costs of systems  upgrades  for the
introduction of the euro. For more information on conversion  costs,  please see
the  U.S.  GAAP  reconciliation  in  note  23  to  the  consolidated   financial
statements. Maintenance provisions have been established for known and estimable
repair and upkeep of stores,  primarily in The  Netherlands.  Straight line rent
represents  the excess of rent expensed (on a straight line basis) for financial
reporting purposes over amounts paid for leases with scheduled increases.       

As of December 31, 2000,  other  provisions  are  comprised of  liabilities  for
potential  environmental,  labor  and other  potential  liability  arising  from
contractual obligations.                                                        

As of December 31, 2000,  approximately  EUR 134 million of the  provisions  are
expected to mature within one year.                                             

Note 15    Shareholders' equity                                                 

On October 9, 2000, a Special  Meeting of  Shareholders  approved an increase in
authorized share capital. It was also decided to convert the par value of all of
our shares to euros.  The  depository  obligation  as a result of  conversion to
euros was charged to the additional paid-in capital.                            

The authorized share capital is comprised of the following classes of shares:   

Cumulative preferred shares (800,000 at EUR 500 each)                 400,000   
Cumulative preferred financing shares (400,000,000 at EUR 0.25 each)  100,000   
Common shares (1,200,000,000 at EUR 0.25 each)                        300,000   
                                                                   -------
                                                                   800,000
                                                                   =======

Cumulative Preferred Shares                                                     

In March 1989,  Royal Ahold and Stichting Ahold  Continuiteit  ("SAC" or, "Ahold
Continuity  Foundation")  entered  into an agreement  (the "Option  Agreement"),
which was amended and  restated in April 1994 and March 1997,  pursuant to which
SAC was granted an option to acquire from us, valid until March 2004, cumulative
preferred shares up to a total par value that is equal to the total par value of
all issued and outstanding shares of capital stock at the time of exercising the
option.  Royal  Ahold had the right  pursuant to the Option  Agreement  to place
cumulative  preferred  shares  with SAC up to a total par value that is equal to
the total nominal value of all issued and outstanding shares of capital stock of
Royal Ahold at the time of placing the cumulative  preferred shares. The holders
of the cumulative  preferred  shares are entitled to 2,000 votes per share and a
cumulative dividend on the outstanding and paid up shares, based on AEBOR with a
minimum of 5.75%.  Each transfer of  cumulative  preferred  shares  requires the
approval of the Corporate Executive Board.                                      

The issuance of  cumulative  preferred  shares will have  certain  anti-takeover
effects.  The issuance of  cumulative  preferred  shares will cause  substantial
dilution  of  the  effective  voting  power  of  any  shareholder,  including  a
shareholder  that attempts to acquire us, and could have the effect of delaying,
deferring and preventing a change in control.                                   

Royal Ahold may  stipulate  that only 25% of the nominal value will be paid upon
subscription  for cumulative  preferred  shares until payment in full of the par
value is later called by Royal Ahold. No cumulative preferred shares were issued
and outstanding during the three year period ended December 31, 2000.           

Cumulative Preferred Financing Shares                                           

In accordance  with Article 46.1 of the Articles of  Association,  the Corporate
Executive Board of Royal Ahold was designated as the body authorized to issue or
grant rights to subscribe for Cumulative  Preferred Financing Shares of whatever
series,  subject to the prior approval of the Supervisory  Board of Royal Ahold,
up to a total nominal amount equal to 25% of all the  outstanding  shares of the
capital stock of Royal Ahold, excluding cumulative preferred shares.  Cumulative
Preferred Financing Shares must be fully paid up upon issuance.                 

Dividends are paid on each Cumulative  Preferred Financing Share at a percentage
(the "Financing  Dividend  Percentage")  based on the average effective yield on
Dutch state loans with a remaining life of nine to ten years,  and such rate has
been fixed for a period of ten years at a rate of 7.37% per fiscal  year for the
share  issuance  in June 1996,  5.18% for the share  issuance in August 1998 and
6.47% for the share issuance in October 2000.                                   

Common Shares                                                                   

The main  market on which the  common  shares of Royal  Ahold are  traded is the
stockmarket  of  Euronext  Amsterdam.  Shares are also listed on the Swiss Stock
Exchange and on the New York Stock  Exchange in the United States in the form of
American  Depositary Shares (ADSs),  evidenced by American  Depositary  Receipts
(ADRs).  The depository for the common shares is The Bank of New York.  Each ADS
evidences the right to receive one common share.                                

The  holders  of  common  shares  are  entitled  to one  vote per  share  and to
participate in the distribution of dividends and liquidation proceeds.          

The dividend for fiscal 1998 was declared in Dutch  guilders.  As of fiscal year
1999,  dividends were declared in euros.  Shareholders  have the option to elect
either a cash or a share  dividend.  The size and  composition of the final 2000
share  dividend  option,  will be announced on May 15, 2001,  after the close of
trading on the Euronext Amsterdam.                                              

Dividends on common shares paid or proposed are as follows:                     

                                                                [Download Table]


 Fiscal Year                  Cash Dividend Option   Stock Dividend Option       
                                                                                 
1998          Interim         EUR 0.12              1 share per 100 shares owned 
              Final           EUR 0.26              2 shares per 100 shares owned

1999          Interim         EUR 0.14              1 share per 100 shares owned 
              Final           EUR 0.35              2 shares per 100 shares owned

2000          Interim         EUR 0.18              1 share per 100 shares owned 
              Proposed final  EUR 0.45              2 shares per 100 shares owned

Stock option plans                                                              

Royal Ahold  established  stock option plans in The  Netherlands  and the United
States,  pursuant  to which a number of  options to  acquire  common  shares are
granted to  executives  and other key salaried  employees of Royal Ahold who are
employed at certain specified job levels and who are designated by the Corporate
Executive Board as eligible to be granted  options,  and such other employees as
are  designated by the Corporate  Executive  Board.  The exercise  price of such
options is equal to the closing price of the common shares on Euronext Amsterdam
on the day prior to the day the options are granted.                            

In The Netherlands,  options granted are exercisable for a period of five or ten
years after the grant date.  Options  granted  prior to the  beginning of fiscal
year 1997 vested  immediately.  Options granted in 1998 have a vesting period of
two years.  During 1999, The  Netherlands  plan was amended and restated and the
vesting period was changed to a period of three years.  In 2000, the option plan
in The Netherlands was amended to grant options also exercisable for a period of
ten years after the grant date.                                                 

In the United States,  Royal Ahold  established  stock option plans in 1986 (the
"1986 U.S.  Plan") and in 1990 (the "1990 U.S.  Plan"),  which were both amended
and restated,  effective  January 3, 2000.  Options  granted under the 1990 U.S.
Plan, as amended,  are exercisable  after a vesting period of five years,  after
which the  options  may be  exercised  in full,  or in part,  during a five-year
period.  Under  the 1986  Plan,  as  amended,  options  granted  thereunder  are
exercisable after a vesting period  determined by the Corporate  Executive Board
and  specified  in each option award  agreement,  after which the options may be
exercised in full, or in part, during the remainder of the five year period from
the date of grant.                                                              

Currently  option rights have been granted to  approximately  5,000 employees to
obtain common shares.  The exercise of option rights is regulated to comply with
Royal  Ahold's  regulations  designed  to  prevent  insider  trading.  Effective
December 1997, the number of option rights granted is dependent on the growth in
earnings per share. Starting January 2000, employees are also allowed to utilize
"out of the money"  option  rights  with  higher  exercise  prices.  Unexercised
options will be forfeited upon  termination  of  employment.  New shares will be
granted upon the exercise of option rights, subject to a yearly maximum of 1% of
the issued shares.                                                              

A summary of the activity under Royal Ahold's stock option plans is as follows: 

                                                        [Enlarge/Download Table]


                                  Beginning             Average               Average               End of    Average
                                  of fiscal             Exercise              Exercise              fiscal   Exercise
                                    year       Granted  Price      Exercised  Price      Canceled   year       Price 
                                  ---------   --------  --------   ---------  -------    --------   -------  --------
                                                                                                                     
C.H. van der Hoeven      5 yr     491,192     105,731   33.75       85,586     9.19        --       511,337   26.44  
                        10 yr     508,888       5,991   30.58         --       --          --       514,879   30.58  
J.G. Andreae             5 yr     326,506      52,927   33.64       45,279     9.19        --       334,154   26.73  
                        10 yr        --        25,000   34.36         --       --          --        25,000   34.36  
A.M. Meurs               5 yr     336,099      53,052   33.64       28,461     9.19        --       360,690   26.13  
                        10 yr        --        25,000   34.36         --       --          --        25,000   34.36  
A.S. Noddle              5 yr     187,171      51,580   34.03         --       --          --       238,751   26.88  
                        10 yr     209,647      27,127   32.67       18,906     4.47        --       217,868   17.83  
R.G. Tobin               5 yr     190,800      51,623   34.02         --       --          --       242,423   26.80  
                        10 yr      95,399      25,813   34.01         --       --          --       121,212   26.80  
M.P.M. de Raad           5 yr        --        50,000   34.36         --       --          --        50,000   34.36  
                        10 yr        --        25,000   34.36         --       --          --        25,000   34.36  
                                ---------     -------              -------     ----        --     ---------          
Total Corporate                 2,345,702     498,844   33.85      178,232     8.69        --     2,666,314   26.99  
Executive                                                                                                            
Board members                                                                                                        
Other associates         5 yr  14,439,061   6,043,578   33.86    2,440,143    15.12     348,907  17,693,589   28.86  
                        10 yr   4,679,797   2,119,593   33.54      478,694     7.05     475,651   5,845,045   25.10  
                               ----------   ---------            ---------     ----     -------  ----------          
Total number of option                                                                                               
rights                         21,464,560   8,662,015   33.79    3,097,069    13.50     824,558  26,204,948   27.83  
                               ==========   =========            =========    =====     =======  ==========          

                                                        [Enlarge/Download Table]


                                                          FISCAL YEAR                                    
                                                          -----------                                    

                                            2000                      1999                    1998       
                                            ----                      ----                    ----       

                                         Average Price             Average Price            Average Price
                                           per Share                 per Share                per Share  
                             Shares          EUR     Shares             EUR     Shares           EUR     
                             ------          ---     ------             ---     ------                   
                                                                                                         
Outstanding at                                                                                           
beginning of year           21,464,560       23.19   17,778,263         20.50  15,994,594        14.43   
Granted                      8,662,015       33.78    5,744,762         29.01   5,768,455        30.60   
Exercised                   (3,097,069)      13.48   (1,912,293)        10.90  (3,794,299)        9.60   
Canceled                      (824,558)      23.32     (146,172)        17.41    (190,487)       12.85   
                            ----------               ----------                -----------               
Outstanding at end of year  26,204,948       27.81   21,464,560         23.36  17,778,263        20.50   
                            ==========               ==========                ==========                

The following table summarizes information about stock options outstanding as of
December 31, 2000:                                                              

                                                        [Enlarge/Download Table]


                             Options Outstanding                             Options Exercisable                 
                             -------------------                             -------------------                 
   Range of                                                 Weighted                               Weighted      
   Exercise                            Weighted Average      Average                                Average      
     Prices   Number Outstanding          Remaining       Exercise Price   Number Exercisable      Exercise Price
        EUR  as of December 31, 2000   Contractual Life            EUR    as of December 31, 2000            EUR 
        ---  -------------------      ----------------    --------------  -----------------------  ------------- 
                                                                                                                 
  5.23-7.49         749,653                3.0            6.68                  749,653              6.68        
 9.19-15.34       2,847,327                2.6           14.40                1,831,802             15.34        
18.55-25.64       3,850,838                2.8           22.37                3,837,120             22.45        
26.28-42.96      18,757,130                7.0           31.84                       --                --        
                 ----------                                                   ---------                          
                 26,204,948                                                   6,418,575                          
                 ==========                                                   =========                          

Royal  Ahold  accounts  for the stock  option  plans  under  Dutch GAAP which is
comparable to Accounting  Principles Board Opinion No. 25 ("APB 25") and related
interpretations for non-compensatory  plans.  Accordingly,  no compensation cost
has been recognized for stock options.  The weighted average fair value of stock
options  granted  during  2000,  1999 and 1998 was EUR 10.55,  EUR 13.38 and EUR
10.91,  respectively.  The  fair  value  of the  stock  option  grants  has been
estimated on the date of grant using the Black-Scholes option pricing model with
the following assumptions:                                                      

                        fiscal      fiscal      fiscal
                        2000        1999        1998
                      -----       -----       ----
Expected life (years):                                                          
1986 Plan                         4.0         4.0         4.0         
1990 Plan                         7.5         7.5         7.5         
Interest rate                         5.5%        6.0%        6.0%              
Volatility                           32.5%       45.0%       30.0%              
Assumed forfeitures                   5.0%        6.0%        6.0%              
Dividend yield                        2.0%        2.0%        2.0%              

Had compensation cost for the stock option plans been determined consistent with
Statement of Financial  Accounting Standards No. 123, Accounting for Stock-Based
Compensation,  ("SFAS  123"),  under  Dutch  GAAP  Royal  Ahold's  pro forma net
earnings and earnings per Common Share would have been as follows:              

                                                        [Enlarge/Download Table]


                                                      fiscal 2000  fiscal 1999  fiscal 1998

                                                                                           
Net earnings after dividends on cumulative preferred                                       
 financing shares:                                                                         
     As reported                                        1,098,547    739,940    537,274    
     Pro forma                                          1,068,225    714,383    527,599    
Earnings per common share:                                                                 
     As reported                                             1.51       1.14       0.91    
     Pro forma                                               1.46       1.10       0.89    
Diluted earnings per common share:                                                         
     As reported                                             1.47       1.11       0.90    
     Pro forma                                               1.38       1.06       0.88    

This pro  forma  impact  only  takes  into  account  options  granted  since the
beginning  of fiscal  year 1995 and is likely  to  increase  in future  years as
additional options are granted and amortized ratably over the vesting period.   

Note 16    Rentals and operating leases with third parties                      

Operating leases of Royal Ahold's U.S.  subsidiaries  generally are for terms of
ten to 25 years,  contain renewal  options and in some cases require  additional
operating  lease payments based on sales volume.  The rental  contracts of Royal
Ahold's Dutch retailing  subsidiaries  generally provide for non-cancelable five
to ten year rental  periods  with  renewal  options,  and rents reset every year
based on predetermined indices.                                                 

The actual costs of rentals and operational leases were as follows:             
              fiscal    fiscal      fiscal
              2000      1999        1998
              --------  --------    --------
Minimum rentals                  848,522   605,073    476,464                   
Contingent rentals               109,965    13,626     11,333                   
Lease and sublease income       (146,156) (117,539)   (80,786)                  
              --------  --------    --------
              812,331   501,160    407,011
              =======   =======    =======

As of December 31, 2000,  the aggregate  amounts of minimum lease payments under
existing operational lease contracts are as follows:                            

2001                                                    974,035                 
2002                                                    903,050                 
2003                                                    824,087                 
2004                                                    717,034                 
2005                                                    656,095                 
Thereafter                                            4,683,917                 
                                     ---------
                                     8,758,218
                                     =========

Minimum lease  payments above have not been reduced by minimum lease or sublease
rental  income  of  EUR  593  million  due in the  future  under  non-cancelable
subleases.                                                                      

Note 17    Income taxes                                                         

The  reconciliation  of income taxes between the Dutch corporate income tax rate
and  Royal  Ahold's  effective  income  tax rate as  shown  in the  Consolidated
Statements of Earnings is as follows:                                           

                                                        [Enlarge/Download Table]


                                                                                                  

                                                                      fiscal     fiscal    fiscal 
                                                                       2000       1999      1998  
                                                                       -----      -----     ----  
Dutch corporate income tax rate                                       35.00%     35.00%    35.00% 

Items affecting the corporate income tax rate                                                     
  Different statutory income tax rate of foreign                                                  
     subsidiaries                                                     (7.48%)    (5.60%)  (10.40%)
  Non-taxable items                                                   (2.49%)    (2.35%)   (0.80%)
  Other factors                                                       (0.04%)    (0.06%)    1.72% 
                                                                      -------    -------    ----- 
Effective tax rate                                                    24.99%     26.99%    25.52% 
                                                                      ======     ======    ====== 

The components of the provisions for income taxes are as follows:                                 

                                                                       fiscal     fiscal    fiscal
                                                                        2000       1999      1998 
                                                                        -----      -----     ---- 
Current:                                                                                          
  Domestic                                                            97,001    105,559    68,077 
  Foreign                                                            195,739    118,742    66,925 
Deferred:                                                                                         
  Domestic                                                            24,450     14,884    45,470 
  Foreign                                                             83,820     43,816    16,603 
                                                                     -------    -------   ------- 
                                                                     401.010    283,001   197,075 
                                                                     =======    =======   ======= 
Earnings before income tax and minority interest                                                  
  Domestic                                                           897,979    702,600   547,065 
  Foreign                                                            706,849    345,878   225,203 
                                                                     -------    -------   ------- 
                                                                   1,604,828  1,048,478   722,268 
                                                                   =========  =========   ======= 

Deferred  income  taxes  reflect  the net tax effects of  temporary  differences
between the carrying  amounts of assets and liabilities for financial  reporting
purposes and the amounts used for income tax purposes.  As of December 31, 2000,
Royal Ahold had operating loss  carryforwards of  approximately  EUR 187 million
expiring  between  2002 and 2022,  general  business  tax  credit  carryforwards
totaling  approximately  EUR 2  million  expiring  between  2001 and  2016,  and
alternative  minimum tax  carryforwards  of EUR 39 million  which can be carried
forward indefinitely.  Such operating loss carryforwards and tax credits may not
be used  to  offset  income  taxes  in  other  jurisdictions.  Royal  Ahold  has
established  a  valuation  allowance  to reduce the tax  benefit of certain  net
operating  losses and certain general  business tax credits to an amount that is
more likely than not realizable.                                                

Deferred tax assets and  liabilities as of December 31, 2000 and January 2, 2000
are as follows:                                                                 

                                                        [Enlarge/Download Table]


                                                   Net deferred tax asset (liability)
                                                   December 31,      January 2,      
                                                      2000            2000           
                                                      ---------   -------------      

                                                                                     

Fixed assets                                         (324,374)     (323,589)         
Capitalized lease commitments                         112,476        68,309          
Benefit plans                                          95,592        23,252          
Inventories                                           (45,883)      (64,600)         
Closed locations                                       37,927        39,872          
Provisions not yet deductible                         102,386       162,342          
Carryforwards                                                                        
   Operating losses                                   186,794       124,979          
   Alternative minimum tax                             39,322        36,725          
   General business tax credits                         2,142        14,730          
Valuation allowances on carry forwards                (73,560)      (36,577)         
Valuation allowances on other deferred tax assets     (13,213)            --         
Other, net                                            (91,137)      (24,548)         
                                                      --------      --------         
                                                       28,472        20,895          
                                                       ======        ======          


Deferred  income taxes are classified in the  accompanying  balance sheets as of
December 31, 2000 and January 2, 2000 as follows:                               
                                                      December      January 2,
                                                   31, 2000         2000
                                                     ---------      ----------
Non-current deferred tax assets                        391,421       123,688    
Non-current deferred tax liabilities                  (362,949)     (102,793)   
                                                   ---------     ---------
                                                    28,472        20,895
                                                    ======        ======

Note 18    Employee benefit plans                                               

Pension plans                                                                   

Royal Ahold has a number of defined benefit pension plans covering substantially
all of its  employees.  Such  plans have been  established  in  accordance  with
applicable  legal  requirements,  customs  and  existing  circumstances  in each
country.  Benefits are generally based upon  compensation  and years of service.
Pension  plan  assets  are  generally   invested  in  shares,   fixed-rate  debt
securities, loans and real estate.                                              

Pension costs for all plans are  actuarially  determined  and  generally  funded
annually.  Royal  Ahold  accounts  for its U.S.  plans under the  provisions  of
Financial Accounting Standards No. 87 ("SFAS 87"). Pension expense for the plans
in The  Netherlands  is calculated  using the  methodology  required under Dutch
GAAP.  Pension  expense of the  qualified  plans  included  in the  accompanying
Statement  of Earnings  for fiscal  years  2000,  1999 and 1998  aggregated  EUR
32,465,  EUR 33,973 and EUR  33,791,  respectively.  In  addition,  Royal  Ahold
received  refunds  of EUR 29  million  in  2000  and EUR 34  million  in 1998 of
overfunded  pension plan assets in The  Netherlands,  which were  reflected as a
reduction  of  general  and  administrative   expenses  in  the  2000  and  1998
Consolidated  Statement of Earnings.  There were no refunds in fiscal year 1999.
Additionally,  certain  union  employees  in the United  States  are  covered by
multi-employer, defined benefit plans. Plan expenses were EUR 70,199, EUR 53,893
and EUR 31,275 for 2000,  1999 and 1998,  respectively.  For a discussion on the
U.S. GAAP accounting treatment, please see note 23 to the consolidated financial
statements.                                                                     

Other benefit plans                                                             

Royal Ahold also maintains  various other employee  benefit plans. For employees
of its U.S.  subsidiaries,  such plans are  principally  in the form of savings,
incentive  compensation  and  bonus  plans.  Royal  Ahold's  Dutch  subsidiaries
participate in a profit sharing plan for their employees.  In the United States,
Royal Ahold also maintains  three  supplemental  employee  retirement  plans for
officers and executives of its subsidiaries.                                    

Post-retirement plans                                                           

Royal Ahold provides life insurance and health care benefits for certain retired
employees meeting age and service requirements at its U.S.  subsidiaries.  Royal
Ahold's post-retirement plans are not funded.                                   

Assumed  health care cost trend rates have a  significant  effect on the amounts
reported for the health care plans. A  one-percentage-point  increase in assumed
health care cost trend rates would have  increased  the aggregate of service and
interest  cost for 2000 by 8%.  The  effect of this  change  on the  accumulated
post-retirement  benefit  obligations  as of the end of fiscal  2000 would be an
increase  of 6%. A  one-percentage-point  decrease  in assumed  health care cost
trend rates would have  decreased  the  aggregate of service and  interest  cost
components of net periodic  retirement  health care benefit cost for 2000 by 6%.
The effect of this change on the accumulated  post-retirement benefit obligation
for health care benefits as of the end of fiscal 2000 would be a decrease of 5%.

For purposes of additional  disclosure,  information  regarding the plans in The
Netherlands  has  also  been  provided  under  the   requirements  of  Financial
Accounting  Standards No 132,  Employers'  Disclosures  About Pensions and Other
Post-retirement Benefits ("SFAS 132"). The following table summarizes the funded
status  and  amounts  which  would  be  recognized  in Royal  Ahold's  financial
statements under SFAS 132 for all defined benefit and other plans.              

                                                        [Enlarge/Download Table]


                                                   United States         United States   
                                                  Pension Plans         Other Benefits   
                                               2000          1999     2000         1999  
                                               ----          ----     ----         ----  
                                                                                         
Change in benefit obligation:                                                            
  Benefit obligation at beginning of year    420,412       390,717   61,609       57,312 
  Service cost                                16,142        17,898      817          872 
  Interest cost                               43,716        30,973     5,325       4,325 
  Amendments                                   5,238           824       --           -- 
  Actuarial loss (gain)                          849       (64,820)  (2,455)      (4,770)
  Acquisition                                117,539            --   28,118           -- 
  Foreign currency exchange rate changes      29,040        62,422    4,255        9,158 
  Benefits paid                              (23,969)      (17,602)  (4,186)      (5,288)
                                             --------      --------  -------      -------
  Benefit obligation at end of year          608,967       420,412   93,483       61,609 
                                             =======       =======   ======       ====== 

Change in Plan Assets:                                                                   
  Fair value of assets, beginning of period  467,983       366,764       --           -- 
  Actual return on plan assets                21,369        40,375       --           -- 
  Company contribution                           989        19,851    4,186        4,405 
  Plan participant contribution                   --            --       --          747 
  Acquisition                                147,066            --       --           -- 
  Foreign currency exchange rate changes      32,327        58,595       --           -- 
  Benefits paid                              (23,969)      (17,602)  (4,186)      (5,152)
                                             --------      ----