Woolworths Group Ltd · ASX:WOW
Woolworths — Shareholder Meeting (November 2003)
24 slides from Woolworths's shareholder meeting presentation, Nov 21, 2003
Slide 1: ASX Listing Rule 3.1 cover letter
21 November, 2003 The Manager, Companies Australian Stock Exchange Limited Company Announcements Office Level 4 20 Bridge Street SYDNEY NSW 2000 Dear sir, WOOLWORTHS LIMITED: LISTING RULE 3.1 For the purpose of Listing Rule 3.1, attached are the presentation materials used by the Chief Executive Off
Slide 2: Woolworths Limited Annual General Meeting
WOOLWORTHS LIMITED ANNUAL GENERAL MEETING 21 November 2003
Slide 3: Roger Corbett, Group Managing Director/CEO
ROGER CORBETT GROUP MANAGING DIRECTOR/ CHIEF EXECUTIVE OFFICER 21 November 2003
Slide 4: FY03 sales by division
FY02 FY03 Change Normalised $m $m % % (2) Supermarkets and Liquor 19,595 21,039 TA% 9.4% -etrol 1,119 1,711 52.9% 55.8% Total Supermarkets 20,714 22,750 9.8% 11.9% IG W 2,281 2,500 9.6% 11.3% >onsumer Electronics 659 791 20.0% 22.5% fotal General Merchandise 2,940 3,291 11.9% 13.8% >ontinuing Operat
Slide 5: EBIT by division FY02 vs FY03
Food & Liquor Petrol Total Supermarkets BIG W Consumer Electronics Total General Merchandise Total Trading Result Property Central overheads Continuing operations Wholesale Group EBIT Previous ** Current * Before After Before After Before After Goodwill Goodwill Goodwill Goodwill Goodwill Goodwill $
Slide 6: Supermarkets key financial metrics
FY02 Sales ($ mil) 20,714.3 Gross Margin (%) 24.84 Cost of Doing Business (%) 21.23 EBIT to Sales (%) 3.61 EBIT before goodwill ($ mil) 767.4 EBIT after goodwill ($ mil) 747.4 Funds Employed ($ mil) 1,495.5 AVE ROFE (%) 53.2 )41.9% increase on a comparable 52 week basis FY03 22,749.5 24.39 20.63 3.7
Slide 7: Food and liquor sales growth highlights
cc * Food and liquor sales growth (ex petrol) was strong. Comparable (like for like) sales of 5.4%. (5.1% first half and 5.8% second half). * Market share of Food, Liquor and Groceries increased by 0.5% in the year. * Sales result reflects customer acceptance of total offer of range, freshness, qual
Slide 8: Liquor business and Dan Murphy's expansion
Woolworths has brought significantly greater price competition to this sector with customers benefiting from lower prices. Despite this our Liquor profitability rate exceeds that of our Supermarkets business. * Expansion of Dan Murphy’s with 5 new stores in NSW / ACT and 3 new stores in Victoria * D
Slide 9: Petrol supplemental offer
Petrol continues to be a good supplemental offer to our Supermarkets with 210 out of 287 canopies either in the car park or adjacent to the store ¢ Petrol sales increased by 55.8% on a 52 week comparable basis ¢ Strong volume growth has helped fractionalise fixed costs ¢ EBIT growth on last year exc
Slide 10: BIG W financial metrics
“acca FY02 FY03 CHG Sales ($ mil) 2,280.5 2,500.3 +9.6%'” Gross Margin (%) 31.30 30.88 -0.42%pts Cost of Doing Business (%) 27.20 26.73 -0.47%pts EBIT to Sales (%) 4.10 4.15 +0.05%pts EBIT * ($ mil) 93.5 103.7 +10.9% Funds Employed ($ mil) 299.2 269.5 -9.9% AVE ROFE (%) 32.6 36.5 +3.9%pts No purchas
Slide 11: BIG W highlights
“ic * BIG W comparable (like for like) sales were a strong and consistent 4.2% (first half 4.2%, second half 4.3%) in a very competitive market. Total sales reached $2.5b. ¢ EBIT exceeds $100m. « Customer EDLP acceptance strong. * Solid growth across all categories, particularly in small appliances
Slide 12: Consumer Electronics financial metrics
\} NI NN FY02 FY03 CH( Sales ($ mil) 659.0 791.2 +20.0 Gross Margin (%) 37.16 33.59 -3.57%pi Cost of Doing Business (%) 32.91 28.91 -4.00%pi EBIT to Sales (%) 4.25 4.68 +0.43%pi EBIT before goodwill ($ mil) 31.3 41.2 +31.6° EBIT after goodwill ($ mil) 28.0 37.0 +32.1' Funds Employed ($ mil) 253.0 24
Slide 13: Consumer Electronics highlights
¢ Business progressing extremely well and is reflected by a 32.1% increase in EBIT after goodwill. * Strong double digit comparable (like for like) sales growth achieved 18.1% (first half 15.5%, second half 21.1%). * Strong growth achieved in communications category, particularly mobile phones and i
Slide 14: Focus areas and results
| Focus Areas Result Continuing Growth High single digit sales growth Improved customer offer Lower prices Bolt-on acquisitions Cost Reductions (The Enabler) Project Refresh | continues ~s Project Refresh II deliveries Capital & Balance Efficient Balance Sheet Sheet Management Continue to reduce inv
Slide 15: Opportunities for ongoing growth in revenues and earnings
Considerable opportunities for ongoing growth in both revenues and earnings Continuing opportunity to grow market share + Market share of Food, Liquor & Grocery (FLG) remains below 30% and still low by world standards ee Defined plans to continue space roll out * Adding 15 - 25 new supermarkets each
Slide 16: Opportunities: new ranges, formats, pricing, acquisitions
hn Considerable opportunities for ongoing growth in both revenues and earnings New range and formats ¢ New format rollouts (eg. smaller BIG Ws to country towns) - New categories across supermarkets and general merchandise eg. pharmacy Continued focus on improved in-store execution and service + Prov
Slide 17: Project Refresh reorganisation
Level | - Reorganisation / line items 99 00 01 02 03 04 O85 O06 O7 08
Slide 18: Cost savings program
1 ,500 _ 3.40% of sales 5 1,200 1025 5 900 —s?| | | jo g Wl il - I||B = 300 } 163 WA em ; WA 00 01 O02 O03 04 O05 O06 O7 O08
Slide 19: Supply chain systems progress
: INT | UT Replenishment ¢ Integration of StockSmart and AutoStockR to provide end- to-end replenishment functionality StockSMART « System development completed - on time and on budget (DC forecast based = *_ Stock levels in DC reduced inventory * Store service levels improved replenishment) Autosto
Slide 20: Distribution centres and logistics roll-out
One Touch Roll Cages Distribution Centres Primary Transport Successfully trialed in 22 stores during FY03 NSW and WA leading the roll-out from FY04 Plan to consolidate 31 Supermarket DCs to 9 Regional and 2 National DC sites of significantly larger size and scale 3 new RDC sites secured — Perth (Air
Slide 21: First quarter FY04 sales by division
Division Food & Liquor Petrol Total Supermarkets BIG W Consumer Electronics Total General Merchandise Continuing Operations Wholesale Total Quarter Sales FY03 FY04 Increase 5,387 5,695 5.7% 373 519 39.1% 5,760 6,214 7.9% 587 656 11.8% 188 215 14.4% 775 871 12.4% 6,535 7,085 8.4% 130 35 -73.1% 6,665
Slide 22: First quarter trading comments
Supermarkets * Sales increase 5.7% greater than national market growth at around 4% * Comparable sales 2.8% increase ¢ Inflation lower by approximately 1.0% to 1.5% BIG W * Comparable sales 5% increase (full year 2003 4.2%) Consumer Electronics ¢ Comparable store sales 13.5%
Slide 23: Outlook and guidance
Sales ¢ Expect sales will continue to grow in the upper single digits Earnings * Anticipate earnings per share before goodwill will be in a range between 67 cps and 70 cps, a growth rate between 10% and 15%. ¢ EPS after goodwill is expected to be in the range of 64 cps to 67 cps, a growth rate betwe
Slide 24: Woolworths Limited Annual General Meeting
WOOLWORTHS LIMITED ANNUAL GENERAL MEETING 21 November 2003