Shoprite Holdings Limited · JSE:SHP
Shoprite — FY2008 Earnings Presentation
24 slides from Shoprite's earnings presentation, 2008
Slide 1: Supermarket Complimentary Services
Supermarket Complimentary Services 48
Slide 2: Net income up 27%, money transfers and ticketing growth
• Net income increased by 27% • Money transfers grown over 300% • We sell enough Mango flight tickets to fill 323 Boeing 737’s • Enough bus tickets to fill 21 000 Lux Liners • And event tickets to fill Newlands 200 times • Currently 12 006 events on sale • Latest retail first with 100% no claim cash
Slide 3: Pharmacies: 10 opened, sales growth of 36.8%
•10 Pharmacies opened, now a total of 53 •Sales growth of 36.8% •Scheduled products make up 74% of sales •Health and Beauty integration showing growths of >100% in some categories •Dispensing on its own not profitable 50
Slide 4: Luxury in a slow economy for LSM 4-6
•A luxury in a slow economy for LSM 4-6 •Sales growth of 23.2% •Trading profit growth of 10.5% •Opened 116th store 51
Slide 5: Liquor: sales and profitability up 3 times
• Sales and profitability up 3 times • Opened 14 stores now 32 trading • Positive contribution to overall store offering • Combined wine sales with the supermarket increased – no cannibalisation • Excellent penetration in Shoprite market segment • 44 new applications submitted 52
Slide 6: Turnover growth of 21% on existing business
•Good turnover growth on existing business of 21% •Overall improvement of cost to income ratio together with the sales improvement increased trading profit by 71.6% •Good debtors book with 95% on 30 days and under •29 newly recruited members 53
Slide 7: Personnel
Personnel 54
Slide 8: Productivity and employment
Productivity and employment •Group: Sales per FTE +13.44% •Employment: Headcount 73 373 •4 096 permanent jobs directly created in the last 12 months •Payroll produces 2 500 000 payslips annually in 17 countries 55
Slide 9: Achievements
Achievements • Substantial increase in volumes: – R102m (14% increase) invested into training – 98 816 training interventions – 821 learnerships – 9 full SETA qualifications • 4 733 Managers attended training programmes • 1 325 Trainee Branch Managers in training during last 6 months • 3 125 employe
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Slide 11: RSA Shoprite Overview
RSA Shoprite Overview • No 1 • Sales growth of 25% • Customer growth of 11.2% • Market leader with 302 stores (7 new) • Relentless low price investment proved a strong success factor during tough economic times • Highest customer loyalty – 43% of customers do their bulk shopping exclusively at Shopr
Slide 12: Shoprite most preferred shopping destination
Shoprite improved its stature as the most preferred shopping destination when competitors’ main bulk shoppers switch Source: Nielsen Shopper Trends Plus June 2007 and June 2008 59
Slide 13: Emerging Markets
Emerging Markets •Best positioned to capture emerging market •434 000 new jobs in RSA from Sep 2006 to Sep 2007 •Strict definition of unemployment down by 2.5% to 23% •Degrees in low income households with a strong increase in R7000+ segment (AMPS 2007 AB) •Continued growth in participation of emerg
Slide 14: Shoprite gained more customers than any other retailer
On a yearly measure, Shoprite 11.5% gained more customers 12.6% than any other retailer 6.5% 7.7% 7.7% 8.8% 6.5% 17.4% Source: All Media and Products Survey (AMPS), 2005, 2006, 2007 61
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Slide 16: Usave Overview
Usave Overview •Sales growth of 48.2% •Customer growth of 21.9% •Gross margin reduced by 1.3% - overall profitability improved (LESS IS MORE!!) •Private label products now 127 at an average price difference of 15% and a 5% margin gain •Although from a low base, the Usave market share has doubled ove
Slide 17: Shoprite Holdings Ltd
SHOPRITE(3 HOLDINGS LTD
Slide 18: Checkers Overview
Checkers Overview •Sales growth of 15.6% (GEB 12.9%) •Customer growth of 6.2% to 13.3m customers per month •Basket Size growth of 9% •Number of stores 143 (7 new, 1 closed) 65
Slide 19: Checkers Strategy
Checkers Strategy •Main objective of repositioning is to become the preferred shopping destination of LSM 8-10 shoppers •Evidence that strategy is gaining traction: - Highest % growth of all retailers in LSM 8-10 - LSM 8-10 profile now sitting at 47.4% (AMPS 2007 AB) •Total store sales have also gro
Slide 20: Total customer participation divided by LSM for Checkers
Total customer participation divided by LSM for Checkers Source: AMPS 2007 67
Slide 21: Checkers Categories
Checkers Categories • Continue to enhance our leadership in key areas where we are outgrowing the market • Focus categories include: – Wine – Cheese – Meat • Steakhouse Classic • Certified Natural Lamb • Championship Boerewors • Perishable basket grew 20% • Rapidly expanding fresh foods range and re
Slide 22: Succession Management
2009… • Succession Management – How well are you positioned with your people? – No of graduates - 1 306 – Entrepreneurs •SA Demographic for future 69
Slide 23: Demographic spread makes us more resilient than other retailers
Demographic spread makes us more resilient than other retailers Source: AMPS 2007 70
Slide 24: Questions
Questions 71