Slide 1: Carrefour Investor Presentation May 2017
CARREFOUR INVESTOR PRESENTATION May 2017 May 2017 | 1
Slide 2: Carrefour's Multiformat & Omnichannel model
Carrefour’s Multiformat & Omnichannel model
Slide 3: Carrefour: the reference in food retail
CARREFOUR: THE REFERENCE IN FOOD RETAIL Unique know- Pioneer Quality Powerful Sourcing how in organic food accessible to all exclusive brands expertise in fresh produce and Quality Lines Food represents 83% of the Group sales in 2016 (growth of over 4% in 2016) INVESTOR PRESENTATION May 2017 | 3
Slide 4: A balanced portfolio
A BALANCED PORTFOLIO Integrated countries Countries in partnership INVESTOR PRESENTATION May 2017 | 4
Slide 5: Continued sales growth
CONTINUED SALES GROWTH ORGANIC SALES GROWTH EVOLUTION EX PETROL - 2012 TO 2016 – (in %) +3.0% CAGR 2012 – 2016 +3.0% +2.6% +3.9% +2.3% +1.0% 2012 2013 2014 2015 2016 2016 INVESTOR PRESENTATION May 2017 | 5
Slide 6: A multiformat group: everyone under one roof
A MULTIFORMAT GROUP: “EVERYONE UNDER ONE ROOF” 2012 1963 1999 2007 2016 to 2015 First Promodès Atacadão Acceleration Hypermarket in convenience Rue Billa, Dia, Eroski du Commerce May 2017 | 6
Slide 7: Each format has a specific mission
EACH FORMAT HAS A SPECIFIC MISSION 51% 25% 10% 13% 1% Sales Sales Sales Sales Sales Hypermarkets Supermarkets Convenience Cash & Carry E-commerce Everything under one roof Choice close to home Essential daily needs with Wholesale prices for a The broadest assortment at a competitive price with a foc
Slide 8: Multiformat progressively rolled out in all our countries
MULTIFORMAT PROGRESSIVELY ROLLED OUT IN ALL OUR COUNTRIES FRANCE SPAI N ITALY BELGIUM POLAND ROMANIA ARGENTINA BRAZIL CHINA TAIWAN Hypermarket Supermarket Convenience Cash & Carry eService Other services: Travel, leisure, ticketing, car rental INVESTOR PRESENTATION May 2017 | 8
Slide 9: Multiformat: a proven track record in revenue uplift
MULTIFORMAT: A PROVEN TRACK RECORD IN REVENUE UPLIFT MULTIFORMAT CLIENTS SPEND MORE Italy multiformat store network: Hypermarkets Supermarkets 57 Hypermarkets 1.9x 416 Supermarkets 1.0x 1.1x 588 Convenience 13 Cash & Carry 2.5x A multi-format customer is more 1.8x 1.7x loyal to Carrefour 30% of cust
Slide 10: Carrefour's center of gravity is shifting towards multiformat
CARREFOUR’S CENTER OF GRAVITY IS SHIFTING TOWARDS MULTIFORMAT BREAKDOWN OF STORES UNDER BANNERS BY FORMAT GROSS SALES BREAKDOWN – (%) 14,500 Evolution stores 2012 vs. 2019e 11,935 350 +100% stores 9,995 1 450 +6% 42% 305 49% stores >50% 164 1,328 3,700 +24% 1,366 3,227 2,986 58% 51% <50% 9,000 + 64%
Slide 11: E-commerce, an additional format and a complementary service
E-COMMERCE, AN ADDITIONAL FORMAT AND A COMPLEMENTARY SERVICE HYPERMARKETS SUPERMARKETS CASH & CARRY CONVENIENCE E-COMMERCE INVESTOR PRESENTATION May 2017 | 11
Slide 12: Rapid rollout of e-commerce throughout the group
RAPID ROLLOUT OF E-COMMERCE THROUGHOUT THE GROUP FRANCE SPAIN ITALY BELGIUM POLAND ROMANIA ARGENTINA BRAZIL CHINA TAIWAN Home FOOD delivery and/or Click In progress 2017 & Collect Direct offer 2017 2017 () () () NON- FOOD Under Under Marketplace In progress In progre
Slide 13: 2020 e-commerce prospects
2020 E-COMMERCE PROSPECTS GROSS MERCHANDISE VOLUME €4bn Target x3 €1.2bn in 2016 2020 target INVESTOR PRESENTATION May 2017 | 13
Slide 14: Store based omnichannel model
STORE BASED OMNICHANNEL MODEL: UNIQUE OPPORTUNITY TO ENSURE E-COMMERCE SUSTAINABILITY OPERATIONAL MODEL CONSUMER CHOICES FOR ORDER MANAGEMENT FOR ORDER COLLECTION Store-picking across formats Home delivery (hypermarkets, supermarkets, convenience) E-Commerce Mixed model: Click & collect in store sto
Slide 15: Carrefour's omnichannel transformation approach
CARREFOUR’S Digital OMNICHANNEL eCommerce marketing TRANSFORMATION APPROACH Technology Big Data IoT Each country adapts the API, agile framework to its market conditions on the basis of key pillars Data, CRM, Omnichannel Hyper- Supply Chain customization HR & cultural transformation
Slide 16: Benefits of omnichannel for Carrefour
BENEFITS OF OMNICHANNEL FOR CARREFOUR Increase in expenditure “Own” the customer and frequency of in our ecosystem existing customers Rejuvenate (Re)Gain customers customer base May 2017 | 16
Slide 17: Omnichannel allows Carrefour to better meet customer needs
Hypermarkets OMNICHANNEL ALLOWS Convenience Convenience & “CLIENT CARREFOUR TO (services) FOR LIFE” E-commerce BETTER MEET LONG-TERM LOYALTY THROUGHOUT CLIENT’S LIFE CUSTOMER THANKS TO MULTIFORMAT NEEDS Hypermarket/ Supermarket/ Drive Click & collect INVESTOR PRESENTATION May 2017 | 17
Slide 18: Carrefour's vast ecosystem favors customer ownership
CARREFOUR’S VAST ECOSYSTEM FAVORS CUSTOMER “OWNERSHIP” Whenever you want 24 hours 7 days Wherever However you want Fresh food Gourmet you want Organic Wine cellar Game & Sports Baby TV · Sound · Photo Textile Technology Appliance ... Whatever you want INVESTOR PRESENTATION May 2017 | 18
Slide 19: Omnichannel reinforces multiformat
OMNICHANNEL REINFORCES MULTIFORMAT +20% +10% A CLIENT WHO ADOPTS DRIVE OR CLICK & COLLECT Hyper- Hyper- market market SPENDS MORE Hyper- + Hyper- + market Drive market Click & Collect Source : 2016 study based on a panel in France and Spain INVESTOR PRESENTATION May 2017 | 19
Slide 20: Omnichannel rejuvenates customer base
OMNICHANNEL REJUVENATES CUSTOMER BASE AVERAGE AGE OF CARREFOUR CUSTOMERS BY FORMAT (2011-2016) Index 100 = average age of Carrefour Hypermarket customers in 2011 108,9 109,3 107,7 104,5 105,3 102,1 Carrefour Market 102,5 103,3 103,5 Carrefour Hypermarket 101,4 100,0 100,4 88,4 85,4 84,7 84,4 84,4 84
Slide 21: Our goal: develop the Carrefour reflex
Carrefour is the leading physical retailer in France. OUR GOAL: We are building a major DEVELOP market position in THE CARREFOUR E-commerce leveraging a “REFLEX” unique store network. INVESTOR PRESENTATION May 2017 | 21
Slide 22: A coherent and complete ecosystem of websites
A COHERENT AND COMPLETE ECOSYSTEM OF WEBSITES DEDICATED WEBSITES SPECIALIZED AN ONLINE FOOD A NON-FOOD FOR SERVICES WEBSITES CONNECTED OFFER ACCESSIBLE PLATFORM INCLUDING TO THE CARREFOUR TO ALL A MARKETPLACE Carrefour brand ECOSYSTEM HOME DELIVERY CLICK AND COLLECT All the websites centralized thro
Slide 23: Food online is not one size fits all
FOOD ONLINE IS NOT ‘ONE SIZE FITS ALL’ A broad Food e-commerce offer at HOME DELIVERY MODEL • Launched in 1999 Delivery D+1 or D+2 • Serves Paris, Lyon, Extra Large assortment Marseille, Nice • ~15,000 SKUs Hypermarket as a warehouse • A 1h-delivery service for Supermarket additional last-minute sho
Slide 24: Omnichannel approach to leverage non food
OMNICHANNEL APPROACH TO LEVERAGE NON FOOD A SINGLE NON FOOD MULTISPECIALIST PLATFORM Store STORE TO WEB: In store tablets available WEB TO STORE: Upload store assortment 750 marketplace merchants to the salesforce online OBJECTIVE: 100% of the full offer CLICK & COLLECT CLICK & COLLECT 3M SKUs avail
Slide 25: Development of our offer on strong potential categories and services
DEVELOPMENT OF OUR OFFER ON STRONG POTENTIAL CATEGORIES AND SERVICES ONLINE FRENCH MARKET CARREFOUR SALES FORECAST (2020) EVOLUTION (2016) OTHER KPIS 340,000 visits/month Wine €400-500m +250% 530 SKUs 600,000 visits/month Organic >€1bn +50% 20,000 SKUs 150,000 visits/month Pet food €600-800m +30% 5,
Slide 26: Data opens new opportunities for Carrefour
Carrefour is well underway to DATA achieve new level of insights and OPENS NEW exploit data commercially and OPPORTUNITIES operationally. FOR CARREFOUR INVESTOR PRESENTATION May 2017 | 26
Slide 27: Data is a 3-stage rocket
DATA IS A 3-STAGE ROCKET Big Data and data science Leverage technology to grow revenue Small data” is in play to enrich Leverage “small data” customer value-proposition and convey adequate messages. Carrefour is already a data-centric Gather relevant data organization gathering relevant customer and
Slide 28: Carrefour is a data-deep company
CARREFOUR IS A DATA-DEEP COMPANY CARREFOUR CARREFOUR SOCIAL LOYALTY CARD CREDIT CARD PAYMENT NETWORKS WEBSITES MOBILE APPS 55 million 6.5 million 13m 14.4m 1.3m 8.2m households holders daily transactions fans / followers daily visitors downloads INVESTOR PRESENTATION May 2017 | 28
Slide 29: Customer data strategy enables revenue growth
CUSTOMER DATA STRATEGY ENABLES REVENUE GROWTH Type of Carrefour customers Carrefour customers Not Carrefour Customer Loyalty cardholder Not cardholders customers PASS cardholder Strategy Increase share of Enroll in loyalty Bring to Carrefour wallet program Type of Data Known Client data Anonymous da
Slide 30: Supply chain: leverage transformation to improve operating efficiency
Our supply chain is evolving to SUPPLY CHAIN: LEVERAGE support multiformat deployment TRANSFORMATION and industrialize omnichannel TO IMPROVE processes. OPERATING EFFICIENCY INVESTOR PRESENTATION May 2017 | 30
Slide 31: Our supply chain is evolving to support Carrefour's transformation
OUR SUPPLY CHAIN IS EVOLVING TO SUPPORT CARREFOUR’S TRANSFORMATION 2 MAIN STRATEGIC GOALS TO SUPPORT GROUP’S TRANSFORMATION Support Industrialize multiformat omnichannel deployment processes Leverage transformation to improve operating efficiency INVESTOR PRESENTATION May 2017 | 31
Slide 32: France: a more efficient multiformat supply chain thanks to Caravelle
FRANCE: A MORE EFFICIENT MULTIFORMAT SUPPLY CHAIN THANKS TO CARAVELLE in 2012 in 2018 Reduced number of warehouses in France 67 -18% 55 2018 CARAVELLE TARGETS* Reinforced network of multiformat warehouses 13 x3 34 Number of Km Number of SKUs -20% +15% +50% Cost of package -5% Number of delivered sto
Slide 33: France: Caravelle enhances operating efficiency
FRANCE: CARAVELLE ENHANCES OPERATING EFFICIENCY 2013 / 2014 2015 2016 2017 2018 €350m 30% 10% 25% 10% 25% savings between end-2012 and end-2018 65% 35% of savings delivered as of end-2016 of savings to be delivered in 2017 and 2018 INVESTOR PRESENTATION May 2017 | 33
Slide 34: China: integration of supply chain supporting multiformat roll-out
CHINA: INTEGRATION OF SUPPLY CHAIN SUPPORTING MULTIFORMAT ROLL-OUT (2/2) INTEGRATION AND OPTIMIZATION OF LOGISTICS % of goods supplied by our BEIJING/TIANJIN DC distribution centers: 40 stores 2017 target: 80% December 2015 Increase in assortment: +20% in small- and mid-sized cities SHENYANG DC
Slide 35: Carrefour tests and operates multiple fulfillment models across markets
CARREFOUR TESTS AND OPERATES MULTIPLE FULFILLMENT MODELS ACROSS MARKETS Future Partly-automated models? # OF DAILY warehouse ORDERS Dark store: (conveyers) dedicated warehouse, Mixed model: manual picking dedicated storage In-store picking space adjacent to geographically the store In-store concentr
Slide 36: Financials
Financials
Slide 37: 2016 key figures
2016 KEY FIGURES RECURRING ADJUSTED OPERATING NET INCOME, FREE CASH FLOW NET SALES EBITDA MARGIN(2) INCOME GROUP SHARE EX. EXCEPTIONAL ITEMS NET DEBT €76,645m 5.1% €2,351m €1,031m €1,039m €4,531m up a a margin of or up an improvement of +2.7%(1) Stable margin 3.1% 1.39 €/per share +9.2% €15m (1) At
Slide 38: Organic growth of 3.0% in 2016
ORGANIC GROWTH OF 3.0% IN 2016 2016 SALES EVOLUTION – (in €m and %) +3.0% 0.0% +3.0% +2.7% +0.2% €79.2 -0.5% €79.0 -0.4% bn €76.9 bn -3.1% €76.6 bn bn 2015 LFL Scope effect1 2016 organic Petrol & Acquisitions/ 2016 net sales Currencies 2016 net sales ex petrol net sales calendar effect disposals at
Slide 39: Gross margin from recurring operations held up well
GROSS MARGIN FROM RECURRING OPERATIONS HELD UP WELL 17,985 GROSS MARGIN FROM RECURRING +3.5% 2016 2016 OPERATIONS at constant (in €m) exch. rates 2015 18,019 GROSS MARGIN 2016 2016 23.5% FROM RECURRING OPERATIONS +10bp (as a % of net sales) 2015 23.4% INVESTOR PRESENTATION May 2017 | 39
Slide 40: Good control of operating costs
GOOD CONTROL OF OPERATING COSTS 13,125 OPERATING +4.9% 2016 2016 COSTS at constant (in €m) 2015 13,070 exch. rates OPERATING 2016 2016 18.7% COSTS (as a % of net sales, +10bp ex. petrol) 2015 18.6% INVESTOR PRESENTATION May 2017 | 40
Slide 41: Stable asset costs as a percentage of sales
STABLE ASSET COSTS AS A PERCENTAGE OF SALES 2,509 ASSET +2.8% 2016 2016 COSTS at constant (in €m) 2015 2,505 exch. rates ASSET 2016 2016 3.6% COSTS (as a % of net sales, Stable ex. petrol) 2015 3.6% INVESTOR PRESENTATION May 2017 | 41
Slide 42: 2016 net sales and recurring operating income by region
2016 NET SALES AND RECURRING OPERATING INCOME BY REGION NET SALES RECURRING OPERATING INCOME Organic growth Variation at Variation at Variation at ex petrol current exch. constant current exch. (in €m) 2015 2016 ex calendar rates 2015 2016 exch. rates rates France 36,272 35,877 -0.9% -1.1% 1,191 1,0
Slide 43: Adjusted net income, Group share
ADJUSTED NET INCOME, GROUP SHARE (in €m) 2015 2016 (in €m) 2015 2016 EBITDA (1) 3,955 3,886 Net income from continuing operations 1,120 934 Recurring operating income 2,445 2,351 Minority share of net income from -143 -148 continuing operations Net income from associates and JVs 44 -36 Net income fr
Slide 44: 2016 free cash flow
2016 FREE CASH FLOW (in €m) 2015 2016 Gross cash flow 2,733 2,964 Change in working capital 81 351 Discontinued activities 3 -11 Operating cash flow 2,818 3,305 Capital expenditure (ex. Cargo) -2,378 -2,492 Net capital expenditure (Cargo) - -249 Change in net payables to fixed asset suppliers 136 -7
Slide 45: The lower capital intensity of growth will help return on capital
THE LOWER CAPITAL INTENSITY OF GROWTH WILL HELP RETURN ON CAPITAL HYPERMARKETS SUPERMARKETS CONVENIENCE CASH & CARRY E-COMMERCE Number of stores 1,328 3,227 7,075 305 n.a % food in sales 70% 85% 95% c100% 55% Capex (by unit) €€€ €€ € € € Expansion outlook = Expansion capex per sqm ++
Slide 46: 2016 capex breakdown
2016 CAPEX BREAKDOWN BREAKDOWN OF CAPEX BREAKDOWN OF CAPEX 2016 CAPEX BY NATURE BY REGION 7% 18% 29% 21% 41% €2,492m 21% (ex Cargo) 25% 32% 6% Remodelling Maintenance France DIA Europe Latin Expansion IT & omnichannel Asia America INVESTOR PRESENTATION May 2017 | 46
Slide 47: Capex evolution reflects Carrefour's multiformat transformation
CAPEX EVOLUTION REFLECTS CARREFOUR’S MULTIFORMAT TRANSFORMATION HISTORICAL CAPEX SPLIT BY FORMAT MEDIUM-TERM TRENDS IN CAPEX (GROUP LEVEL) Remodeling Maintenance • Expansion in smaller formats 48% Expansion 64% • E-commerce roll out >60% IT & Omnichannel • Hypermarket remodeling 2017 CAPEX phase lar
Slide 48: Slight drop in net debt
SLIGHT DROP IN NET DEBT (in €m) 2015 2016 Opening net debt (December 31) -4,954 -4 546 Free cash flow 687 603 Acquisitions -85 -190 Disposals 109 45 Others -28 -25 Discontinued operations 0 16 Cash flow after acquisitions and disposals 682 449 Dividends paid by parent company -390 -121 Dividends pai
Slide 49: Credit rating and debt maturity maintained
CREDIT RATING AND DEBT MATURITY MAINTAINED DEBT REDEMPTION SCHEDULE – (in %) 5.25% 4.00% 3.88% On April 26, 2016, issua issuance 2.44% 1.75% 1.75% 1.25% of a €750m bond with a maturity 0.75% of 8 years and a 0.75% coupon 1,250 1,000 1,000 1,000 1,000 In 2016, €667m of bonds reached maturity 750 750
Slide 50: Stable proposed dividend: €0.70 per share
STABLE PROPOSED DIVIDEND: €0.70 PER SHARE Dividend Payout of 51% of Payment in of €0,70 adjusted net income, shares or in cash proposed Group share, in line to the General with our distribution Shareholders’ policy meeting on June 15, 2017 INVESTOR PRESENTATION May 2017 | 50
Slide 51: Value-creation drivers
VALUE-CREATION DRIVERS Solid Disciplined Control of Balanced generation of Capex Working capital operating cash between €2.3bn Capital allocation, flow and €2.5bn per Requirements combining year (€2.4bn in linked to improved continued targeted 2017), results acquisitions, with strict Return on Inves
Slide 52: Financial outlook – 2017 & medium-term
FINANCIAL OUTLOOK – 2017 & MEDIUM-TERM Total sales growth of 3% to 5% Planned IPOs of Carmila Continued increase in Free Cash at constant exchange rates in and Brazilian operations in 2017, Flow, with a new increase in 2017 2017 market conditions permitting Capex decrease in 2017 to Payout of betwee
Slide 53: Appendix
Appendix
Slide 54: Variation of Q1 2017 sales (including VAT)
VARIATION OF Q1 2017 SALES (INCLUDING VAT) Total sales Change at current Change at Organic growth LFL ex petrol inc. VAT exchange rates inc. constant exchange LFL inc. petrol ex petrol ex calendar (€m) petrol rates inc. petrol ex calendar France 9,406 +0.8% +0.8% +2.1% +0.5% -0.6% Hypermarkets 4,848
Slide 55: Q1 2017 takeaways
Q1 2017 TAKEAWAYS Continued momentum, with strong LFL and overall sales growth in Q1: ● Solid sales growth in Q1 ● LFL sales growth in France, solid performance of smaller formats ● Further growth in Europe on the back of strong comparables ● Continued strong sales growth in Latin America despite sl
Slide 56: Hypermarkets: everything under one roof at a competitive price
HYPERMARKETS EVERYTHING UNDER ONE ROOF AT A COMPETITIVE PRICE Carrefour’s historical format HYPERMARKETS New hypermarket concepts tested in all geographies Renewed offer – attractive and powerful Gradually becoming more urban, as cities expand 100,000 SKUs 51€ Average basket (France) 1,328 s
Slide 57: Supermarkets: choice close to home with a focus on fresh
SUPERMARKETS CHOICE CLOSE TO HOME WITH A FOCUS ON FRESH Dedicated to food SUPERMARKETS “Clusterizing” to better address local needs 4 clusters: Gourmet, Attraction, Urban, Discount Successful cross-fertilization across countries 20,000 Average SKUs 28€ Average basket (Belgium) 3,227 stores 1
Slide 58: Convenience: essential daily needs with extended shopping hours
CONVENIENCE ESSENTIAL DAILY NEEDS WITH EXTENDED SHOPPING HOURS Format in constant evolution, adapting to changing social and consumption trends CONVENIENCE On top of generalist stores, multiple tests of specialized convenience concepts across countries (organic stores, etc.) Last 2 countries t
Slide 59: Cash & Carry: wholesale prices for a no-frills experience
CASH & CARRY WHOLESALE PRICES FOR A NO-FRILLS EXPERIENCE B2B pure play activities in France (Promocash) and Italy (Docks and Gross Iper) CASH & CARRY Hybrid B2B/B2C: Atacadão is a winning model in Brazil Successful cross-fertilization based on Atacadão in other countries: Maxi in Argentina and
Slide 60: 2016 gross sales
2016 GROSS SALES Change at Change at Change at LFL Organic growth Gross sales current exch. constant exch. constant exch. ex. petrol ex. petrol (in €m) rates inc. petrol rates inc. petrol rates ex. petrol LFL inc. petrol ex. calendar ex. calendar France 40,126 -1.2% -1.2% -0.5% -0.1% +0.3% -0.9% Hyp
Slide 61: Stores under banners at end 2016
STORES UNDER BANNERS1 AT END 2016 (#) Hypermarkets Supermarkets Convenience Cash & Carry Total France 243 1,062 4,222 143 5,670 Spain 175 129 545 849 Belgium 45 442 285 772 Italy 57 412 586 13 1,068 Poland 86 159 641 886 Romania 32 213 53 298 Others 44 422 202 668 Other European countries 439 1,777
Slide 62: Contacts
CONTACTS HEAD OF INVESTOR RELATIONS IR DIRECTORS Mathilde RODIE Louis IGONET Anne-Sophie LANAUTE mathilde_rodie@carrefour.com louis_igonet@carrefour.com anne-sophie_lanaute@carrefour.com +33 1 41 04 28 06 Tel: +33 1 41 04 27 63 Tel: +33 1 41 04 41 22 +33 6 32 13 70 17 Mob: +33 6 72 24 91 26 Mob: +33