Ceconomy Ag · XETR:CEC
Ceconomy — Merger or Acquisition (June 2018)
18 slides from Ceconomy's merger presentation, Jun 20, 2018
Slide 1: CECONOMY signs Russian deal with M.video/Safmar and pushes portfolio optimization and consolidation
CECONOMY signs Russian deal with M.video/Safmar and pushes portfolio optimization and consolidation Dusseldorf, 20 June 2018
Slide 2: Disclaimer and Notes
DISCLAIMER (segmental or other) information in the consolidated financial statements of the former METRO Group and, thus, may not be fully comparable to such financial statements. Historical our business, results of operations, financial position or cash flows. There are, however, material limitatio
Slide 3: Disclaimer and Notes (cont'd)
Disclaimer and Notes (cont’d) We do not undertake any obligation to publicly update any CECONOMY is based on certain estimates and assumptions and presentation, warrant that the data collected, processed and forward-looking statements or to conform them to events or there can be no assurance that th
Slide 4: CECONOMY is the largest Consumer Electronics platform in Europe
CECONOMY is the largest Consumer Electronics FACT BOX CECONOMY’s European market platform in Europe share 13.4% 13.5% 13.2% #1 Market position Other market position Critical market position No presence 14/15 15/16 16/17 #1 position through Fnac Darty // All-time high market share at 13.5% // Leading
Slide 5: CECONOMY has resolved 2 portfolio issues during the last 18 months with 2 critical market positions remaining
CECONOMY has resolved 2 portfolio issues during the last 18 months with 2 critical market positions remaining redcoon Turkey Sweden Russia // Restructuring of redcoon // Succeeded in turning // Initiated cost savings // Market position completed around Turkey: profitable program further affected by
Slide 6: Decision on a new set-up in Russia
Decision on a new set-up in Russia 1 MediaMarktSaturn transfers its Russian retail business to Safmar, controlling shareholder of M.video 2 MediaMarktSaturn acquires a strategic stake of 15% in M.video from Safmar 3 M.video is commited to join the European Retail Alliance and to become the third mem
Slide 7: This deal cleans up the CECONOMY portfolio and actively drives consolidation in the Consumer Electronics industry
This deal cleans up the CECONOMY portfolio and actively drives consolidation in the Consumer Electronics industry Acquisition of c.24% Acquisition of 15% stake in Fnac Darty stake in M.video July 2017 May 2018 June 2018 Step … 6 Independence Start of the European M.video plans to join Retail Allianc
Slide 8: MediaMarkt Russia has no leading position and is likely to remain sub-scale
MediaMarkt Russia has no leading position and is likely to remain sub-scale given current competitive landscape €526m €-14m EBITDA1 Facts total sales €-26m EBIT1 // Store network grew from 3 stores in 2006 to a peak of 67 stores, excl. Shop-in-Shops, in 2015 // Faced strong top-line and margin press
Slide 9: The M.video/Safmar transaction is the best option, after assessing all alternative "Lead or Leave" scenarios
The M.video/Safmar transaction is the best option, after assessing all alternative “Lead or Leave” scenarios Lead Leave Gain leading market position in the Russian market through: Pull back from Russian market through: // Organic growth (store expansion): Substantial investment // Wind-down of exist
Slide 10: Russia has a growing CE market with M.video as a clear leader
Russia has a growing CE market with M.video as a clear leader Growth in the Russian CE market1 Bricks & Mortar Online Facts (in €bn) +4% +3% +3% +22% 29.4 30.2 31.1 // Sizeable Consumer Electronics market, which stands 28.2 23.2 5.4 5.9 6.3 6.6 for around 10% of the total European Consumer 4.3 Elect
Slide 11: M.video is Russia's largest electronics and consumer appliances retailer
M.video is Russia’s largest electronics and consumer appliances retailer Group pro-forma 2017 // M.video started its operations in 1993 and is publicly listed since 2007; Net sales c. €4.2bn in 2017, M.video became part of Safmar Group, one of the largest Top-Line industrial and financial groups in
Slide 12: Media-Saturn-Holding acquires a 15% stake in PJSC M.video and transfers its entire business to Safmar
Media-Saturn-Holding, CECONOMY’s majority shareholding, acquires a 15% stake in PJSC M.video and transfers its entire business to Safmar High-level transaction structure Target structure €258m** + transfer of entire Russian business Media-Saturn- Holding FREE FLOAT 15% stake in PJSC M.video; c.78% V
Slide 13: Transaction with significant long-term value for CECONOMY, and some negative one-time effects
Transaction with significant long-term value for CECONOMY, and some negative one-time effects in this financial year Main positive effects Main negative effects 15% participation in the profitable Russian market leader One-time non-cash deconsolidation impact and book value (recognized and disclosed
Slide 14: Financing considerations
Financing considerations MediaMarktSaturn finances transaction fully with existing cash Maintain our strategic options 1 2 Maintain financial flexibility Drive further market consolidation 3 4 Facilitate implementation of strategic agenda Support for investment grade rating We consider raising our s
Slide 15: Adjustment of outlook driven by increasing EBITDA/EBIT base and elimination of Russian turn-around effects
Adjustment of outlook driven by increasing EBITDA/EBIT base and elimination of Russian turn-around effects FY 2016/171 €m Baseline pre-transaction2 Transaction impact3 Adjusted baseline3 €mTotal sales 22,155 (526) 21,628 • Effect 1: Higher 2016/2017 EBITDA (excl. Fnac Darty) 704 +14 4 717 EBITDA/EBI
Slide 16: Key messages
Key messages 1 2 3 4 5 6 ERA now Continuation Continued M.video represents of portfolio presence in Large commited to CECONOMY worldwide optimisation: the fast shareholder join the leads largest CE Russia, growing in the clear European consolidation volume with Turkey, Russian CE market leader Retai
Slide 17: Contact
CECONOMY AG Investor Relations Benrather Strasse 18-20 CONTACT 40213 Dusseldorf Germany Tel.: +49 (211) 5408-7222 Email: IR@ceconomy.de https://www.ceconomy.de/en/investor-relations/ Date: 20.06.2018 // 17
Slide 18: Date: 20.06.2018
Date: 20.06.2018 // 18