It is now over two years since Ahold first began its slide into the red, feeling the impact of currency devaluations in Latin America. This decline was exacerbated by the discovery of widespread fraud at the company's US Foodservice business, which left the retailer with a €1 billion hole in its accounts which needed to be plugged.
To do so, the group stepped up its programme of disposals which had begun following the initial losses and has now withdrawn completely from Asia and Spain, is close to quitting Latin America and has reduced its footprint in the US and parts of central Europe.
Selling off businesses has, of course, taken its toll on turnover, which dropped 7.3 per cent to €52 billion in 2004, but with the disposals now apparently coming to an end, another factor is likely to have a major influence on sales in 2005 - the decline of the US dollar.
While Ahold has withdrawn partially from the US (the sale of Bruno's and BI-LO, for example, is due to be completed early this year), it has retained a large chunk of its operations there, not least the foodservice business at the heart of the fraud scandal. As a result, the current weakness of the dollar has taken a major toll on sales - excluding the impact of exchange rates, sales for 2004 would have been down just 0.4 per cent, and excluding disposals as well would in fact have risen by 3.1 per cent.
The exchange rates also mask a mixed performance from the US retail business, with sales ahead 1.6 per cent at $27.4 billion but principally as a result of an extra trading week in 2004; on a comparable basis, sales were down 0.4 per cent, mainly as a result of more store closures.
The US Foodservice group fared slightly better, posting a 3.9 per cent improvement on a comparable basis to $18.8 billion, although food price inflation was the main reason for the improvement.
So Ahold clearly still has some work to do to strengthen its US operations this year, but should be well positioned to benefit should the exchange rate situation improve in line with a possible strengthening US economy (which would, of course, also increase consumer spending levels). Its more streamlined US operations, clustered now around three regional groups rather than spread across the country, should allow it to cut costs further in 2005, while the reduction in its number of foodservice customers should also improve efficiency going forward.
Ahold's European business now forms the core of the group, with the Netherlands and central and eastern Europe its main arenas. Price wars in the Dutch market in 2004 took their toll early in 2004, but the moves to position the flagship Albert Heijn chain as a low-cost retailer are now paying off, as Ahold leverages its buying power. The chain ended 2004 with sales of €5.8 billion, up 1.1 per cent on 2003 on a like-for-like basis.
Ahold remains one of the few European groups with a substantial holding in the notoriously difficulty US market - Belgium's Delhaize is another notable exception, while France's Casino also has a smaller holding - and it has continued to make money there when others (Sainsbury and Marks & Spencer, for example ) have been forced to sell up.
With the dollar unlikely to remain weak against the euro for ever, and with years of solid trading experience in the US under its belt, Ahold is well positioned to benefit from the eventual upturn in the American economy, especially as its programme of disposals is now all but complete and it can dedicate even more time and effort to growing those businesses which it has retained.
But with Ahold's withdrawal from those markets likely to lead the way in retail development over the next few years - Latin America and Asia - the company has to rely more than ever on its US operations.
There is certainly still room for growth in central and eastern Europe, but it will be many years until consumer spending levels there reach those in the west, even in many of the new EU member states, and growth is more likely to come through new stores- which are likely to become ever harder to achieve as planners clamp down on out-of-town developments.
The most turbulent period in Ahold's recent history is coming to an end, but the immediate future looks likely to be only marginally calmer.