Kesko Oyj Class A · OMXHEX:KESKOA
Kesko Oyj Class A — Q1 2017 Earnings Presentation
28 slides from Kesko Oyj Class A's earnings presentation, May 3, 2017
Slide 1: Kesko presentation Q1/2017
— Kesko presentation Q1/2017 CFO Jukka Erlund Wi
Slide 2: Highlights
Highlights Net sales increased in all divisions and profitability remained at a good level despite renewal projects Extensive chain renewal in grocery trade is progressing well Building and technical trade division is growing in B2B trade, operating profit continued to improve Car trade sales and pr
Slide 3: Key Performance Indicators
Key Performance Indicators Q1/2017 Q1/2016 Net sales, €m 2,597 2,013 Net sales growth, % +29 3 Operating profit*, €m 28.7 32.3 Operating margin*, % 11 1.6 Profit before tax*, €m 33.6 34.5 Earnings/share”, € 0.29 0.26 Return on capital employed’, %, rolling 12 mo 11.2 12.4 Return on equity”, %, rolli
Slide 4: Net Sales by Division Q1/2017
Net Sales by Division Q1/2017 Car trade €245m Ce Growth 8.9%, comparably +3.4%* €2,597m Building and technical trade €1,112m Growth 59.9%, comparably +5.9% Grocery trade €1,243m Growth 13.6%, comparably +0.1%
Slide 5: Net Sales by Quarter
Net Sales by Quarter Q1/2017 growth 29.0%, comparably +2.4% €m 2015 M2016 2017 3,000 5 2765 2,500 5 2,082 2,013 2,000 + 1,500 4 1,000 + 500 5 0+ Q1 Q2 Q3 Q4
Slide 6: Operating Profit by Quarter
Operating Profit by Quarter Comparable €m 100 5 Wi 2015 M2016 M2017 80 4 60 4 40 4 Q1 Q2 Q3 Ql , K
Slide 7: Return on Capital Employed by Division Q1/2017
Return on Capital Employed by Division Q1/2017 Comparable, rolling 12 mo % 30 5 23.3 20.7 20 + Grocery trade Building and technical trade Car trade 11.2 Group total
Slide 8: Strong Financial Position
Strong Financial Position 31.3.2017 31.3.2016 Equity ratio, % 47 55 Liquid assets, €m 365 746 Interest-bearing net debt, €m 226 -311 Cash flow from operating activities, Q1, €m -57 -96 Cash flow from investing activities, Q1, €m -34 -53
Slide 9: Grocery Trade
Grocery Trade
Slide 10: Grocery Trade
Grocery Trade 10 K Group’s grocery sales +15.8%, comparably excluding Suomen Lahikauppa +0.2% Profitability at a good level thanks to growth, efficiency measures and divestment of Russian operations Suomen Lahikauppa’s profit impact negative owing to seasonal fluctuations and extensive change progra
Slide 11: New K-Market Chain - Finland's Most Comprehensive Neighbourhood Store Network
New K-Market Chain - Finland’s Most Comprehensive Neighbourhood Store Network * Over 800 K-Markets provide a solid platform for the . . . Se cee eee ee ee hel implementation of neighbourhood market strategy “a Ld — * 407 Siwas and Valintatalos converted into K-Markets and 57 of them transferred to r
Slide 12: Net Sales
Net Sales Q1/2017 growth 13.6%, comparably +0.1% 1,243 1,000 + 500 | Q1/2016 Q1/2017 n
Slide 13: Operating Profit
Operating Profit Comparable €m 40 4 30 5 20 + 10 5 % 31.3 Q1/2016 26.4 Q1/2017
Slide 14: Building and Technical Trade
Al Building and Technical Trade
Slide 15: Building and Technical Trade
Building and Technical Trade 15 Net sales growth 59.9%, in local currencies excluding Onninen 5.9% Strong sales growth in B2ZB trade continued Good position in growing markets Comparable operating profit increased despite renewal projects
Slide 16: Integration of Onninen into Kesko Progressing Well
Integration of Onninen into Kesko Progressing Well * Strongest B2B sales entity in the market * Onninen’s sales growth 12% and operating profit €2.5 million (€-3.0 million, pro forma 2016) * B2B business organised into a single entity ¢ Reorganisation programmes are progressing in Poland and Sweden
Slide 17: New K-Rauta Has Got Off to a Good Start
New K-Rauta Has Got Off to a Good Start * K-Rauta and Rautia combined into new K-Rauta chain * Finland’s largest and most diversified network of uy K-RAUTA building and home improvement stores at 139 locations fo - YLLATTAVAN HELPPOA Pianjaterassin susihituottet * Launch of renewed k-rauta.fi online
Slide 18: Net Sales
Net Sales Q1/2017 growth 59.9%, comparably +5.9% €m 1,500 5 1,000 + 500 5 Q1/2016 Q1/2017 18
Slide 19: Operating Profit
Operating Profit Comparable €m 10 4 0.3 Q1/2016 Q1/2017 19
Slide 20: Car Trade
Car Trade
Slide 21: Car Trade
Car Trade * Car trade net sales are growing and profitability at a good level * Strong growth in first time registrations of vans +49% (market +30%) + Long delivery times have affected first time registrations of passenger cars; situation will improve as new models become available * Integration of
Slide 22: Net Sales
Net Sales Q1/2017 growth 8.9%, comparably +3.4% 245 200 4 100 4 Q1/2016 Q1/2017 2
Slide 23: Operating Profit
Operating Profit Comparable €m 15 4 10.0 10 4 Q1/2016 Q1/2017 23
Slide 24: Outlook
Slide 25: Outlook
Outlook Estimates for the outlook of Kesko Group's net sales and comparable operating profit are given for the 12-month period following the reporting period (4/2017-3/2018) in comparison with the 12 months preceding the end of the reporting period (4/2016-3/2017). The general economic situation and
Slide 26: Growth Strategy Implementation Continues
Growth Strategy Implementation Continues * Increasingly unified K Group focusing on growth areas * Integrations and synergies of acquisitions * Capture the significant growth potential in the building and technical trade profitably * Continued improvement of cost effectiveness * Improvement of custo
Slide 27: K Group the Third Biggest Retail Operator in Northern Europe
K Group the Third Biggest Retail Operator in Northern Europe a K Group’s sales €13.2bn (pro forma 2016) ONE UNIFIED { THE CUSTOMER AND QUALITY - IN EVERYTHING WE DO K Group formed by Kesko and 1,088 K-retailer entrepreneurs KCITYMARKET «Supermarket Operations in nine countries KMarket KESPRO MeESTEK
Slide 28: For shopping to be fun
as For shopping to be fun Ce