Ceconomy Ag · XETR:CEC
Ceconomy — Investor Day (2023)
81 slides from Ceconomy's investor day presentation, 2023
Slide 1: Capital Markets Day
Capital Markets Day O
Slide 2: Today's agenda
I. Group Strategy Dr Karsten Wildberger II. Foundations for Growth Dr Karsten Wildberger III. Building Blocks of our Strategy Dr Sascha Mager & Remko Rijnders & Andy Wolfe IV. Business Plan Dr Kai-Ulrich Deissner V. Q&A Session Executive committee VI. Lunch Executive committee VII. Store tour: Xperi
Slide 3: Let's Go
Capital Markets Day 2023 3 Let's Go
Slide 4: Welcome to CECONOMY Capital Markets Day 2023
Capital Markets Day 2023 4 Welcome to CECONOMY Capital Markets Day 2023 / Please note that following presentation is NOT indicating any changes from our Capital Markets guidance for FY 22/23
Slide 5: I. Group Strategy
Capital Markets Day 2023 5 Our Purpose “We Create I. Group Strategy EXPERIENCE ELECTRONICS to Enrich People’s Life” Dr Karsten Wildberger
Slide 6: Our strategy is all about the customer
Capital Markets Day 2023 6 Our strategy >2.2 bn +53 >35 m is all about Customer contacts Net Promotor Score Loyalty members the customer
Slide 7: We operate in a constantly growing industry
Capital Markets Day 2023 7 We operate in a constantly growing industry Growth opportunities Sustainability Sustainable and energy-efficient products +50% CAGR in energy-efficient category segments3 Premium products More premium products in key categories 47% of consumers prefer fewer but higher qual
Slide 8: And guide customers through an increasingly complex world
Capital Markets Day 2023 8 And guide customers through an increasingly complex world Convenient and Sustainable Strong and reliable Customer-centric Lifecycle seamless shopping products and partner to assortment services experience solutions the industry
Slide 9: We are better positioned than many competitors to deliver a great omnichannel experience
Capital Markets Day 2023 9 We are better positioned than many competitors to deliver a great omnichannel experience Awareness Presence Omnichannel Excellence Industry Relationships / >70% unaided brand / Market leading / Seamless omnichannel / Long-standing awareness position in 9 out of 11 journey
Slide 10: Four strategic pillars provide direction
Capital Markets Day 2023 10 Four strategic pillars provide direction “Front-line first Employee delivering great Engaging employees and customers experience customer experience” Shopping “Mobile-first Omnichannel Excellence growing online “We Create experience omnichannel” and transforming our store
Slide 11: Employee experience: Putting our front-line first
Capital Markets Day 2023 11 Employee experience: Putting our front-line first Employer Branding Net Promoter People Store Upskilling Higher employer Increased NPP scores Investment into people attractiveness 75% Target of 100% 64% reached until 14,000 end of FY 23/24 +31 NPP peopl e ov er the last t
Slide 12: Moving from CE retail to a retail service platform with several business models
Capital Markets Day 2023 12 Moving from CE retail to a retail service platform with several business models >2.2 bn annual customer contacts > > ”The Next Stores Online App ”Omnichannel Touchpoints“ Direct Contact Social Big Thing“ … Center Media Retail Core Services & Space-as-a- Marketplace Privat
Slide 13: Our Purpose
Capital Markets Day 2023 13 Our Purpose We create Experience Electronics to enrich people’s life
Slide 14: II. Foundations for Growth
Capital Markets Day 2023 14 Our Purpose “We Create II. Foundations for Growth EXPERIENCE ELECTRONICS to Enrich People’s Life” Dr Karsten Wildberger
Slide 15: Freed from the burdens of the past, we can drive our transformation faster
Capital Markets Day 2023 15 Freed from the burdens of the past, we can drive our transformation faster “Myth” “Reality” Shareholders’ conflicts Shareholder structure simplified, effective governance established, and conflicts resolved Complex store ownership structure Centralization on national leve
Slide 16: Progress since the last Capital Markets Day in 2020
Capital Markets Day 2023 16 Progress since the last Capital Markets Day in 2020 CMD 2020 Status FY 21/22 >€22 bn net sales FY 22/23 €21.8 bn Digital sales towards 30% 25% +30% Services & Solutions sales vs FY 19/20 +19% >20% SKU reduction -30% store SKUs1, +€500 m net sales new categories1 +€270 m s
Slide 17: Building on strong market positions we are continuing to optimize our international portfolio
Capital Markets Day 2023 17 Building on strong market positions we are continuing to optimize our international portfolio 9 markets with #1 or #2 position Other2 East / Lead-or-leave strategy Sales West/South3 share by segment1 DACH / Sustained double-digit market share in most markets / Stronger po
Slide 18: And we have started to reposition our strong brands
Capital Markets Day 2023 18 And we have started to reposition our strong brands by building on our new purpose and refreshed strategy Image & perception: Positioning as experience champion Focus on strategic differentiators: Omnichannel, services & the human factor International campaigning: Success
Slide 19: Strengthening financial performance with continuously increasing contribution from new business models
Capital Markets Day 2023 19 Strengthening financial performance with continuously increasing contribution from new business models >2.2 bn annual customer contacts Moderate Sales Growth & c. 30% Online Share c. 5.5% Services & €750 m c. 5% Up to20 c. €45 m Solutions Marketplace Private Label Retail
Slide 20: We trust in our international management team to deliver our transformation
Capital Markets Day 2023 20 We trust in our international management team to deliver our transformation Dr Karsten Dr Kai-Ulrich Wildberger Deissner Chief Executive Officer Chief Financial Officer Dr Sascha Guido Iris Mager Monferrini Pruefer Chief Operating Officer - Chief Operating Officer – Chief
Slide 21: Dr Sascha Mager
Capital Markets Day 2023 21 Dr Sascha Mager Chief Operating Officer - Germany
Slide 22: III. Building Blocks of our Strategy
Capital Markets Day 2023 22 Our Purpose “We Create III. Building Blocks of our Strategy EXPERIENCE ELECTRONICS to Enrich People’s Life” Dr Sascha Mager & Remko Rijnders & Andy Wolfe
Slide 23: Building Blocks of our Strategy: Rewarding customer loyalty
Capital Markets Day 2023 23 Building Blocks of our Strategy Rewarding customer loyalty Customer Loyalty Retail Core Services & Space-as-a- Marketplace Private Label Retail Media Solutions Service Omnichannel Supply Chain | Tech Stack Sustainability People
Slide 24: Loyalty and customer stickiness drive platform value
Capital Markets Day 2023 24 Loyalty and customer stickiness drive platform value myMediaMarkt Germany Impact Sales with loyalty members MediaMarkt Germany in €bn Performance improvement after launch of points-based loyalty program in October 2022 c. +20% >10% higher basket size1 0.9 0.7 + 2.5% highe
Slide 25: Our ambition is to double the sales impact
Capital Markets Day 2023 25 Our ambition is to double the sales impact Our growth levers How we measure success Sales with loyalty members across the group in €bn Launch myMediaMarkt concept in 8 further countries until FY 24/25 c. +60% Omnichannel communication platform in all countries until FY 23
Slide 26: Building Blocks of our Strategy: Omnichannel excellence
Capital Markets Day 2023 26 Building Blocks of our Strategy Omnichannel excellence Customer Loyalty Retail Core Services & Space-as-a- Marketplace Private Label Retail Media Solutions Service Omnichannel Supply Chain | Tech Stack Sustainability People
Slide 27: We continuously improve the omnichannel shopping experience
Capital Markets Day 2023 27 We continuously improve the omnichannel shopping experience Illustrative—exemplary customer journey Interest Information Selection Purchase Installation Usage Care/Repair Extension Online 70% start their Inspire via Buy products Deliver Use customer care Use online journe
Slide 28: We have doubled our online share and will grow even more
Capital Markets Day 2023 28 We have doubled our online share and will grow even more Our growth levers How we measure success Online sales in €m +124% Now >80% of online sales generated on new web while consumer app pushed more strongly New content platform leads to higher organic traffic2 c. 6,500
Slide 29: Four store formats, all around experience zones, services, and the human touch
Capital Markets Day 2023 29 Four store formats, all around experience zones, services, and the human touch LIGHTHOUSE CORE Inspiration and Availability and Experience Advice >4,000sqm c. 1,200-3,500sqm XPRESS SMART Proximity and Omnichannel and Convenience City center location c. 400-1,100sqm c. 70-
Slide 30: We target the complete overhaul of core store portfolio by FY 25/26
Capital Markets Day 2023 30 We target the complete overhaul of core store portfolio by FY 25/26 Refreshing our store portfolio How we measure success Smart Store portfolio Xpress 6 Lighthouse stores with significantly increased frequency development Lighthouse & profitability – 20 stores planned unt
Slide 31: Building Blocks of our Strategy: Making our assortment even more attractive
Capital Markets Day 2023 31 Building Blocks of our Strategy Making our assortment even more attractive Customer Loyalty Retail Core Services & Space-as-a- Marketplace Private Label Retail Media Solutions Service Omnichannel Supply Chain | Tech Stack Sustainability People
Slide 32: Our private labels are an important part of our assortment
Capital Markets Day 2023 32 Our private labels are an important part of our assortment Three key consumer demands… …addressed by our four very strong private labels Consumer Consumer Accessories Price appliances electronics for devices Consumers are value-focused and want to buy for the best price Q
Slide 33: We set ourselves ambitious targets to grow our highly profitable private label business
Capital Markets Day 2023 33 We set ourselves ambitious targets to grow our highly profitable private label business We have already achieved strong private label We will integrate private label into our retail core shares in key categories and grow by >100% Share of private label in % of respective
Slide 34: Building Blocks of our Strategy: Improving our marketplace offering
Capital Markets Day 2023 34 Building Blocks of our Strategy Improving our marketplace offering Customer Loyalty Retail Core Services & Space-as-a- Marketplace Private Label Retail Media Solutions Service Omnichannel Supply Chain | Tech Stack Sustainability People
Slide 35: We are continuously expanding our customer-centric assortment
Capital Markets Day 2023 35 We are continuously expanding our customer-centric assortment Breadth of assortment Yesterday / Customer-centric prioritization of Reduction of online/ strategic assortment & private label Online Assortment offline assortment B&M Assortment Today Launch of / SKU and stock
Slide 36: We are increasing the share of adjacent and new categories
Capital Markets Day 2023 36 We are increasing the share of adjacent and new categories by building on our 360° concepts Today: Approx. 80% of our product mix on growing categories3 Market size Bubble size: MMS inhouse share of respective department (Oct 22–Feb 23, €bn) 25 We are focusing on growth c
Slide 37: Marketplace is the key driver to enrich our assortment
Capital Markets Day 2023 37 Marketplace is the key driver to enrich our assortment Our growth levers How we measure success Gross Merchandise Value in €m Assortment: Currently c. 1,000 sellers offering c. 1 m SKUs with aim to 750 further accelerate seller onboarding & SKU growth Customer satisfactio
Slide 38: MMS Germany performing strongly despite market pressure
Capital Markets Day 2023 38 MMS Germany performing strongly despite market pressure Market development in Germany Turnaround in Germany Quarterly 2YR stack growth trend (in %)1 12% +120 bp market share gain in H1 FY 22/23; +132% EBIT (G) YoY2 5% 1% 1% -6% Expanded Services & Solutions income as key
Slide 39: Coffee break
Capital Markets Day 2023 39 Coffee break
Slide 40: Remko Rijnders
Capital Markets Day 2023 40 Remko Rijnders Chief Operating Officer – BeNeLux, Iberia, Turkey, Poland
Slide 41: Building Blocks of our Strategy: Growing our service platform
Capital Markets Day 2023 41 Building Blocks of our Strategy Growing our service platform Customer Loyalty Retail Core Services & Space-as-a- Marketplace Private Label Retail Media Solutions Service Omnichannel Supply Chain | Tech Stack Sustainability People
Slide 42: Today's big variety of Services & Solutions Portfolio
Capital Markets Day 2023 42 Today’s big variety of Services & Solutions Portfolio Insurance and warranties Telecom and digital products Power Services € Finance Services Sustainability services and others
Slide 43: Services along the entire product life cycle – our life-time promise
Capital Markets Day 2023 43 Services along the entire product life cycle – our "life-time promise" Provide services along the entire product life cycle – our "life-time promise" Hand out trade-in Enable circular vouchers economy with rental Trade-in models Device- as-a- Recycling Service of products
Slide 44: We have extended our service portfolio and acquired new capabilities
Capital Markets Day 2023 44 We have extended our service portfolio and acquired new capabilities Proof points Impact Operational Services & Solutions Income in % of total net sales1 4.5% First uniform service-oriented training concept 4.0% Extended warranties available as monthly subscription across
Slide 45: Spain as an example of strong services offering
Capital Markets Day 2023 45 Spain as an example of strong services offering Market development in Spain Services & Solutions in Spain Quarterly 2YR stack growth trend (in %)1 25% Services & Solutions income as key earnings pillar 19% 2% 5% -4% Strong repair capabilities with highly efficient infrast
Slide 46: We expect >€200 m increase in Services & Solutions income by FY 25/26
Capital Markets Day 2023 46 We expect >€200 m increase in Services & Solutions income by FY 25/26 Our growth levers How we measure success Operational Services & Solutions Income in % of total net sales1 Train-the-trainer concept established to continuously c. 5.5% improve sales excellence – train a
Slide 47: Building Blocks of our Strategy: Scaling Retail Media
Capital Markets Day 2023 47 Building Blocks of our Strategy Scaling Retail Media Customer Loyalty Retail Core Services & Space-as-a- Marketplace Private Label Retail Media Solutions Service Omnichannel Supply Chain | Tech Stack Sustainability People
Slide 48: We provide an attractive Retail Media platform for our partners
Capital Markets Day 2023 48 We provide an attractive Retail Media platform for our partners Sponsored Sponsored Consideration Product Ad Brand Ad & Action Report A+ Content Increase sales Increase brand Access to all insights Transforming the and market share awareness across to make data-driven pro
Slide 49: We are continuously expanding our Retail Media capabilities
Capital Markets Day 2023 49 We are continuously expanding our Retail Media capabilities to drive additional income Our growth levers How we measure success Retail Media Income €m 4 products live in core countries since FY 21/22 c. 45 Partnership with global ad-tech company Criteo successfully establ
Slide 50: Andrew Wolfe
Capital Markets Day 2023 50 Andrew Wolfe Chief Technology Officer
Slide 51: Building Blocks of our Strategy: Supply chain and tech transformation
Capital Markets Day 2023 51 Building Blocks of our Strategy Supply chain and tech transformation Customer Loyalty Retail Core Services & Space-as-a- Marketplace Private Label Retail Media Solutions Service Omnichannel Supply Chain | Tech Stack Sustainability People
Slide 52: We are transforming our tech infrastructure and will be fully in the cloud in three years
Capital Markets Day 2023 52 We are transforming our tech infrastructure and will be fully in the cloud in three years Our tech stack transformation The move from single channel and multichannel to omnichannel … We are replacing our legacy IT systems New IT capabilities enable us to develop new busin
Slide 53: In the Netherlands, we have already moved to state-of-the-art
Capital Markets Day 2023 53 In the Netherlands, we have already moved to state-of-the-art Proof points of our pilot country Netherlands Technology next to supply chain is the backbone of the omnichannel vision to achieve a seamless customer experience "One stock" availability by consolidating Nation
Slide 54: We are also transforming our supply chain
Capital Markets Day 2023 54 We are also transforming our supply chain – from store-centric to multi-tier omnichannel networks… Simplified illustration From sales channel dependent fulfillment …To omnichannel integrated fulfillment (Store - Centric)… (Anytime – Anywhere) Ecommerce Distribution Center
Slide 55: Improving availability, delivery excellence, and efficiency
Capital Markets Day 2023 55 …thus, improving availability, delivery excellence, and efficiency FY 19/20 FY 21/22 FY 25/26 Sales & Not Comparable (New methodology 75%+ Availability 90%+ Availability Operations Planning since FY 20/21) Omnichannel 19% Centralization 34% Centralization 80% Centralizati
Slide 56: Case study: New DC in Göttingen (DE)
Capital Markets Day 2023 56 Case study: New DC in Göttingen (DE) shows improved operational and financial KPIs with further scale-up of activities Delivered Plan Outlook FY 21/22 FY 23/24 FY 25/26 Centralized 13.4 m >20 m >55 m # of units Net contribution Negative Break even Positive per piece
Slide 57: Dr Karsten Wildberger
Capital Markets Day 2023 57 Dr Karsten Wildberger Chief Executive Officer
Slide 58: Building Blocks of our Strategy: Delivering sustainability agenda
Capital Markets Day 2023 58 Building Blocks of our Strategy Delivering sustainability agenda Customer Loyalty Retail Core Services & Space-as-a- Marketplace Private Label Retail Media Solutions Service Omnichannel Supply Chain | Tech Stack Sustainability People
Slide 59: Sustainability is part of our DNA
Capital Markets Day 2023 59 Sustainability is part of our DNA 1 2 3 "We offer a climate- "We offer the most "We take social neutral shopping sustainable range of responsibility for our experience" CE products and are employees, suppliers circular business and communities" pioneers in Europe"
Slide 60: We have set ourselves ambitious sustainability targets
Capital Markets Day 2023 60 We have set ourselves ambitious sustainability targets Our growth levers Reducing carbon emission Scope 1&2 Scope 3 Ongoing application for “Science Based Targets” (SBTi) and participation in the EU Sustainable Consumption Pledge Our operations Upstream and downstream At
Slide 61: We continuously increase the share of sustainable and energy-efficient products
Capital Markets Day 2023 61 We continuously increase the share of sustainable and energy-efficient products in our assortment Broad range of sustainable products BetterWay sales share in % across the group Double the number of BetterWay products in our c. 20% assortment to c. 7,000 in FY 25/26 3% FY
Slide 62: Our more-life-per-cycle proposition goes beyond sustainable products
Capital Markets Day 2023 62 Our more-life-per-cycle proposition goes beyond sustainable products Our growth levers How we measure success Repairs – group wide in m 4.3 Full range from classic repair service to individual advice 3.2 3.5 on upgrades, remote service, sale of spare parts FY 18/19 FY 21/
Slide 63: Building Blocks of our Strategy: Engaging employees and customers
Capital Markets Day 2023 63 Building Blocks of our Strategy Engaging employees and customers Customer Loyalty Retail Core Services & Space-as-a- Marketplace Private Label Retail Media Solutions Service Omnichannel Supply Chain | Tech Stack Sustainability People
Slide 64: We invest in our people and measure the success of our strategic initiatives
Capital Markets Day 2023 64 We invest in our people and measure the success of our strategic initiatives “Let’s Go!” Employer Branding Campaign Diversity, equity & inclusion roadmap People Experience and clear targets +31 NPP 1 Performance Management Process & International Leadership Program Busine
Slide 65: Because in the end … it's all about Customer Experience!
Capital Markets Day 2023 65 Because in the end … it’s all about Customer Experience!
Slide 66: Dr Kai-Ulrich Deissner
Capital Markets Day 2023 66 Dr Kai-Ulrich Deissner Chief Financial Officer
Slide 67: IV. Business Plan
Capital Markets Day 2023 67 Our Purpose “We Create IV. Business Plan EXPERIENCE ELECTRONICS to Enrich People’s Life” Dr Kai-Ulrich Deissner
Slide 68: Our key pledges for FY25/26
Capital Markets Day 2023 68 Our key pledges for FY25/26 – regularly communicated to capital markets Our key pledges for FY 25/26… …and further KPI targets Retail core Retail Core # of customer contacts 2.2 bn # of sold refurbished products c. 220,000 Sales with loyalty members c. +60%1 Availability
Slide 69: Our growth plan targets >€500 m EBIT and c. €200 m FCF
Capital Markets Day 2023 69 Our growth plan targets >€500 m EBIT and c. €200 m FCF Key financial figures FY 21/22 Growth plan FY 25/26 Adjusted EBIT €208 m1 >€500 m Gross margin 17.6%1 c. 20% EBIT increase of c. 150% Adjusted OPEX ratio 17.7%1 c. 18% Slightly above Net Sales €21.1 bn1 market growth
Slide 70: Service businesses play biggest role in profitability increase
Capital Markets Day 2023 70 Service businesses play biggest role in profitability increase Simplified approximation Adj. EBIT margin c. 2.5% c. 0.2%p. c. 0.9%p. c. 0.2%p. c. 0.2%p. 1.0% c. 0.2%p. FY 21/221 Retail Core Private Label Marketplace Operational Retail Media FY 25/26 (incl. Space- Services
Slide 71: Growth in all business units - platform businesses significantly increase contribution
Capital Markets Day 2023 71 Growth in all business units - platform businesses significantly increase contribution Gross Profit / OPEX €m EBIT FY Adj. EBIT €208 m1 21/221 Margin 1.0%1 Adj. EBIT >€500 m FY 1.1x 1.0x 2x 8x 1.3x 9x 25/26 Margin c. 2.5% Retail Core (incl. Space-as-a-Service) Private Lab
Slide 72: Cost savings are driven by two main initiatives
Capital Markets Day 2023 72 Cost savings are driven by two main initiatives Cost savings Restructuring costs FY 23/241 FY 22/23 - 23/24 Simplification and digitization of central structures and processes, e.g. / Redesign of central and local SG&A functions c. €80 m / Streamlining of global business
Slide 73: We underpin our prudent financial policy with clear commitments
Capital Markets Day 2023 73 We underpin our prudent financial policy with clear commitments Historical values & outlook: Leverage target ratio <2.5x 0.8x 1.1x 2.3x 2.3x FY 19/20 FY 20/21 FY 21/22 FY 22/23 Net Debt incl. lease liabilities / Adjusted EBITDA + in €m Senior unsecured bond Sufficient liq
Slide 74: Dr Karsten Wildberger
Capital Markets Day 2023 74 Dr Karsten Wildberger Chief Executive Officer
Slide 75: Before we wrap-up, there's a little more…
Capital Markets Day 2023 75 Before we wrap-up, there’s a little more… myMediaMarkt Plus: Full Care Proposition 24/7 product lifecycle support Repair1 of all insured products, even if not bought at MediaMarktSaturn Start H2 FY 22/23 BASIC PREMIUM All household appliances & Additional coverage for com
Slide 76: We are ready for the future
Capital Markets Day 2023 76 We are ready for the future The customer is at the core of our strategy We progress from Consumer Electronics to Experience Electronics “We Create EXPERIENCE Experience-based omnichannel platform with multiple business models ELECTRONICS to Enrich Clear plan to double EBI
Slide 77: Technical Break
Capital Markets Day 2023 77 Our Purpose “We Create Technical Break EXPERIENCE ELECTRONICS to Enrich People’s Life”
Slide 78: Questions & Answers Session
Capital Markets Day 2023 78 Questions & Answers Session Dr Karsten Dr Kai-Ulrich Wildberger Deissner Chief Executive Officer Chief Financial Officer Dr Sascha Guido Iris Mager Monferrini Pruefer Chief Operating Officer - Chief Operating Officer – Chief Human Germany Italy, Austria, Switzerland, Reso
Slide 79: Disclaimer and Notes
Capital Markets Day 2023 79 DISCLAIMER the actions of public authorities and other third parties, many of which are beyond our control, that could cause actual results, performance or financial position to differ materially from any including primary research, secondary sources and econometric model
Slide 80: Disclaimer and Notes
Capital Markets Day 2023 80 DISCLAIMER AND NOTES Such financial information is not necessarily indicative for the operational results, the financial position and/or the cash flow of the CECONOMY business on a stand-alone basis neither in the past nor in the future and may, in particular, deviate fro
Slide 81: CECONOMY
O CECONOMY