Carrefour Sa · EURONEXT:CA
Carrefour Sa — Investor Day (February 2005)
37 slides from Carrefour Sa's investor day presentation, Feb 1, 2005
Slide 1: Carrefour France Presentation to Analysts
CARREFOUR France Presentation to Analysts 1st February 2005 1 Presentation to Analysts / 01.02.2005
Slide 2: Introducing our Hypermarket management
Introducing our Hypermarket management Venette 216 hypermarkets Exploitation Nord – 51 stores L’Isle d’Adam PARIS NORD on the 17th December Frédéric Philippe St.Pol sur Mer PAS DE CALAIS Limay St Brice Calais Hazebrouck Montigny les C. Coquelle Armentières 2004 Sartrouville Stains St Martin au Laert
Slide 3: Carrefour is the number one French retailer
Carrefour the market leader Carrefour is the number one French retailer • We are the number one hypermarket retailer in France with market share of 14% • We have 216 stores (179 integrated, 37 franchised), of which 109 achieve sales of more than € 100 m p.a. Of these, 16 achieve sales of more than €
Slide 4: Carrefour is also a market leader in services
Carrefour the market leader Carrefour is also a market leader in services • 2 750 000 Cartes Pass cards in circulation • 386 000 customers • €2 bn of loans to clients • 87 agencies • 520 000 contracts :+7% • €1.4 bn of customer • 400 000 travelling in 2004 savings customers in 2004 • No1 retail insu
Slide 5: Hypermarkets are part of a successful multi-format strategy in France
Carrefour the market leader Hypermarkets are part of a successful multi- format strategy in France Split of Carrefour France sales Carrefour’s market share by format 21,30% 14,00% Carrefour = 25.7% 7,80% 5,70% 3,90% 52,20% 20,80% 74,30% Hypermarkets Supermarkets Hard discount Others Hypermarkets Sup
Slide 6: The Carrefour brand is very strong
Carrefour the market leader The Carrefour brand is very strong • No one does better than Carrefour in fresh food* • Carrefour is recognised as market leader* for – Service – Innovation – Store lay out – Communication (advertising, catalogues, magazine) • In the past, however, we have lagged in terms
Slide 7: In 2004, we took back the initiative on price
Carrefour in 2004 In 2004, we took back the initiative on price • In January 2004, 30 % of our hypermarkets were # 1 or # 2 on price versus their local competitors* • Today, almost all of our hypermarkets are # 1 or # 2 locally *Source : GPS 7 Presentation to Analysts / 01.02.2005
Slide 8: In 2004, we took back the initiative on price
Carrefour in 2004 In 2004, we took back the initiative on price Number of stores first on price in their catchment area 100% National Accords ! 134 stores (out of 179 80% integrated) 60% were first on 40% price in their catchment area 20% in December 0% 04 04 Ju 4 04 04 04 04 04 04 04 04 04 0 ug ch
Slide 9: Carrefour has never before been as competitive on price
Carrefour in 2004 Carrefour has never before been as competitive on price Carrefour versus competition (GPS exhaustive price index) National Accords Index 98 02 03 02 04 02 03 04 02 03 04 03 04 04 02 03 04 n n t ct t ct pt s s s nv ov t ai ai ai oû oû Ja Ja ar ar ar e M M M O O Se Ja N il l A A M M
Slide 10: Carrefour has never before been as competitive on price
Carrefour in 2004 Carrefour has never before been as competitive on price 3 Site by site Carrefour is cheaper 2,5 2 1,5 1 0,5 0 juin-03 juil-03 août-03 sept-03 oct-03 nov-03 déc-03 janv-04 févr-04 mars-04 avr-04 mai-04 juin-04 juil-04 août-04 sept-04 oct-04 nov-04 déc-04 -0,5 -1 -1,5 2 1 3 Carrefour
Slide 11: We began to see the results in Q4 sales
Carrefour in 2004 We began to see the results in Q4 sales Number of customer transactions Q1 03 Q2 03 Q3 03 Q4 03 Q1 04 Q2 04 Q3 04 Q4 04 0% -1% -2% -3% -4% -5% -6% 11 Presentation to Analysts / 01.02.2005
Slide 12: We will press home our advantage in 2005
Carrefour in 2005 We will press home our advantage in 2005 We will lower prices by more than €300 m in the current year Our target is that 100 % We will lower prices of our hypermarkets will across the whole offer, be number one, or equal on national brands and number one, on price in own label, wit
Slide 13: We have the means to pay for this
Carrefour in 2005 We have the means to pay for this • We will continue to cut costs • We will secure further synergies with Carrefour group • We are developing our product offer and margin mix = broadly stable EBIT margin in 2005 13 Presentation to Analysts / 01.02.2005
Slide 14: We are cutting costs
Carrefour in 2005 We are cutting costs • We expect to reduce costs by € 200 m in 2005 14 Presentation to Analysts / 01.02.2005
Slide 15: We are securing synergies with other parts of Carrefour group
Carrefour in 2005 We are securing synergies with other parts of Carrefour group • When we buy Number One in common, we typically reduce our buying costs by up to 35% • Our « Produits Carrefour Internationaux » are sourced on a European basis, allowing us to price 15- 20% lower than comparable own la
Slide 16: We are developing the product offer
Carrefour in 2005 We are developing the product offer • We are redefining the assortment to differentiate ourselves from our competitors • With our own labels, we are making our offer even more attractive • We are adapting better to local customer needs 16 Presentation to Analysts / 01.02.2005
Slide 17: We are redefining our assortments in food and non food
Carrefour in 2005 We are redefining our assortments in food and non food • Segmentation allows us to differentiate versus other formats Carrefour own label Breakdown of dry The best value grocery sales 21% 6% Fighting brands National brands 74% The cheapest on display Choice, innovation and low pric
Slide 18: With N° 1, we are the cheapest in the market
Carrefour in 2005 With N° 1, we are the cheapest in the market • Within 18 months of its launch, Number One has become one of the best recognised brands in France, with sales of €630m • With Number One, we are the cheapest in the market Food Non Food 18 Presentation to Analysts / 01.02.2005
Slide 19: Our investment in the Carrefour brand is paying off
Carrefour in 2005 Our investment in the Carrefour brand is paying off • Our own brands are much more visible on the shelf • We are developing targeted sub-brands such as Carrefour Bio • Carrefour own label in dry grocery has seen a 1.4 percentage point increase in share of volume year on year The ra
Slide 20: Our investment in the Carrefour brand is paying off
Carrefour in 2005 Our investment in the Carrefour brand is paying off • The Carrefour brand is also about fresh food • Filières Qualité Carrefour is a guarantee of quality • Fresh food is key to customer loyalty and generating traffic in store 20 Presentation to Analysts / 01.02.2005
Slide 21: Our investment in the Carrefour brand is paying off
Carrefour in 2005 Our investment in the Carrefour brand is paying off • In non-food, we have selected key categories where we are growing our exclusive brands • We launched the Tex range in Baby in January 2005 159€ 79€ 39€ 21 Presentation to Analysts / 01.02.2005
Slide 22: In Non-food, we are developing a more targeted offer
Carrefour in 2005 In Non-food, we are developing a more targeted offer Every day purchases New markets Seasonal ranges Generating profitability Creating a modern image Driving traffic 22 Presentation to Analysts / 01.02.2005
Slide 23: In apparel, Tex has become the leading brand in France
Carrefour in 2005 In apparel, Tex has become the leading brand in France We have rolled out our Spanish apparel offer in all our French hypermarkets. An extended range has been under test at Villiers-en Bière and roll out will begin next month 23 Presentation to Analysts / 01.02.2005
Slide 24: In consumer electronics, we are growing Bluesky and Number One
Carrefour in 2005 In consumer electronics, we are growing Bluesky and Number One, and have introduced Carrefour Techno Carrefour Techno is a new integrated presentation of consumer electronics which has increased sales by 3% to 7% in H2 2004. Techno will be in all French stores by April 24 Presentat
Slide 25: We are branding the culture offer better
Carrefour in 2005 We are branding the culture offer better A more segmented approach to help customers find what they want has been rolled out across the chain 25 Presentation to Analysts / 01.02.2005
Slide 26: We are developing new ranges in home furnishings
Carrefour in 2005 We are developing new ranges in home furnishings The new ranges in glassware have increased volumes by 48% 26 Presentation to Analysts / 01.02.2005
Slide 27: We are adopting a new marketing approach
Carrefour in 2005 We are adopting a new marketing approach • More targeted • More focused on price • More local, more “feel-good” • Setting Carrefour apart from its competitors • Better results at a lower cost 27 Presentation to Analysts / 01.02.2005
Slide 28: We are adopting a new marketing approach
Carrefour in 2005 We are adopting a new marketing approach • Promotional campaigns based on more punchy offers • And more targeted catalogues 28 Presentation to Analysts / 01.02.2005
Slide 29: We are adopting a new marketing approach
Carrefour in 2005 We are adopting a new marketing approach • Our pricing message is getting clearer • As we use our customer database to do more targeted marketing, we are able to communicate better and at lower cost 29 Presentation to Analysts / 01.02.2005
Slide 30: Our loyalty card has been a huge success
Carrefour in 2005 Our loyalty card has been a huge success • Our card is different to anything else on offer – The card can be used in any Carrefour hypermarket – Holders receive a 5 % discount on Carrefour own labels – Savings on products chosen by the customers themselves 30 Presentation to Analys
Slide 31: Our loyalty card has been a huge success
Carrefour in 2005 Our loyalty card has been a huge success • In only 9 months since its launch, we now have – 6.5 million active holders, equivalent to 50% of our customer base or 25% of French households – 59 % of sales are made using the card – The average value of the cheque given to holders is 9
Slide 32: The success of our loyalty card enables targeted marketing
Carrefour in 2005 The success of our loyalty card enables us to move from mass marketing to targeted marketing We have launched targeted programmes to create loyalty to the brand For example: • baby • pets • Wine aficionados • « Club Junior » 32 Presentation to Analysts / 01.02.2005
Slide 33: The success of our loyalty card enables targeted marketing
Carrefour in 2005 The success of our loyalty card enables us to move from mass marketing to targeted marketing 1 Only 50% of our loyal customers buy meat each month 2 Development of targeted couponing 10% en réduction fid élité 15% sur votre sur prochain votre achat de 3 Prochain Boucherie caddie ch
Slide 34: The loyalty card helps us understand where our customers live and shop
Carrefour in 2005 The loyalty card helps us understand where our customers live and how they shop The store director manages his communication locally 34 Presentation to Analysts / 01.02.2005
Slide 35: We are adding new m2, and upgrading the quality of our portfolio
Carrefour in 2005 We are adding new m2, and upgrading the quality of our portfolio • In 2005, we will invest €440m in French hypermarkets, of which 60% will be spent on modernising our stores • We will accelerate the addition of new m2 in 2005 (60,000 m2 versus 40,000 m2 in 2004) • We will enlarge 2
Slide 36: Conclusion
Carrefour CONCLUSION • We have fundamentally repositioned the business on price in 2004. We will press home our advantage in 2005 • We will do this by investing more than €300m in price • We have the means to finance these price investments and expect EBIT margin to be broadly stable in 2005. Howeve
Slide 37: Presentation to Analysts / 01.02.2005
37 Presentation to Analysts / 01.02.2005