Shoprite Holdings Limited · JSE:SHP
Shoprite — FY2009 Earnings Presentation
17 slides from Shoprite's earnings presentation, August 2009
Slide 1: Operational Overview
Opera,onal Overview Whitey Basson Chief Execu5ve Officer 20
Slide 2: Operational Overview
Opera,onal Overview • Excellent volume growth despite economic downturn • Sold almost 5bn items (8% growth) • Now more than 60m customers per month (9% growth) by being the lowest priced retailer • Assisted by high food inflaLon in all countries and 13% in currency conversion to the rand for non‐RSA
Slide 3: 3 Year Performance
3 Year Performance • Profitable market share growth, despite maintaining lowest prices • Increased margin through below‐the‐line efficiencies Return on Equity 41.5% Sales Growth 37.3% 30.6% 24.5% Trading Margin 22.3% 16.2% 4.1% 4.8% 5% 2007 2008 2009 2007 2008 2009 2007 2008 2009 22
Slide 4: International Comparison
Interna,onal Comparison • Shoprite is an internaLonal business running at world class efficiencies Food Retailers Food Manufacturers Shoprite Avg Int Avg SA Avg Int GP Margin 19.3% 24.5% 35.2% 44.3% OperaLng Profit Margin 4.96% 5.3% 12.9% 13.9% % Share of Margin 37% 36% 63% 64% 23
Slide 5: Operational Overview - RSA Supermarkets
Opera,onal Overview ‐ RSA Supermarkets • Sales growth 22.8% to R47bn (Like stores growth: 17.8%) • Lowered margins to the value of R300m • Offset by: - Increased producLvity R124m - Volume increase R119m • Customers responded to the investment in price – growing 9% • Market share reached a 9 year hig
Slide 6: Outpaced competition every month of the year
Outpaced compe,,on every month of the year* Shoprite Group Market excluding Shoprite Group (Pick n Pay, Spar, Woolworths) 25
Slide 7: Our brands cover the entire SA customer profile
Our brands cover the en,re SA customer profile 10 9 LSM 8 Target 7 Market 6 5 4 3 2 1 1000 skus 18000 skus 48000 skus Assortment size: SMALL MEDIUM LARGE 26
Slide 8: RSA overview
RSA overview • Aggressively maintained low price leadership posiLoning – paid dividends in the tougher economic Lmes • More than 14m individual shoppers, more than any other supermarket (AMPS, Released March 2009) • Extremely loyal customer base - 39% shop exclusively at Shoprite (AMPS, Released Mar
Slide 9: "Did you know?" Corporate TV Campaign
“Did you know?” Corporate TV Campaign* • Sold 105m litres of coke, enough to cover more than 1000 soccer fields • Gained 1m new customers this year • Bought enough toys for each of the 16m kids in SA who celebrated a birthday • Sold 294m nappies last year 28
Slide 10: Voted SA's No.1 Supermarket
VOTED SA's NO.1 SUPERMARKET
Slide 11: Most powerful supermarket brand
is the most powerful supermarket brand* 3.1% = internaLonal 3.3% benchmark for strong brands 2.4% 3.1% 1.5% 0.8% Shoprite Pick n Pay Spar/Superspar Woolworths Supermarket Source: Nielsen Shopper Trends Study (May 2009) 30
Slide 12: Gaining customers in core target market
is gaining customers in core target market 73% 67% 2006 2008 20% 14% 13% 13% LSM 1–3 LSM 4–7 LSM 8–10 Source: AMPS (Released March 2009) 31
Slide 13: RSA overview
RSA overview • Fastest growing store format in RSA opened 36 stores • Aim to open a store a week • Private label products now contribute 19% of turnover - On average, priced 13% below brand leaders - with 8% higher margin • Served 50m customers • ROI > 50% 32
Slide 14: RSA overview
RSA overview • The Checkers brand grew at 27.6%, faster than any other supermarket brand in RSA • ReposiLoning success story as Checkers gained affluent shoppers from compeLtors – resulLng in 12.2% customer growth • Customer profile improved and LSM 9 now makes up the largest porLon of the shopper base
Slide 15: Steakhouse Classic, Cheese World, Housebrand
Steakhouse Classic Cheese World Housebrand Cer,fied Natural Lamb Odd Bins 34
Slide 16: Checkers Winter Wines Catalogue
Checkers Winter Wines Catalogue 35
Slide 17: Gained higher LSM customers
gained higher LSM customers 2006 2008 73% 67% 20% 14% LSM 1 – 6 LSM 7 – 10 Source: AMPS (Released March 2009) 36