Carrefour Sa · EURONEXT:CA
Carrefour Sa — Investor Day (May 2011)
39 slides from Carrefour Sa's investor day presentation, May 17, 2011
Slide 1: Investor Day
Investor Day MAY 17'S Carrefour Property DIA Presentation spin-off
Slide 2: Meeting agenda
Meeting agenda Lars Olofsson A new step forward Pascal Duhamel Carrefour Property: fully embracing Carrefour’s real estate opportunities Pierre Bouchut Carrefour’s pro‐forma financials post DIA spin‐off Lars Olofsson Update on trading environment The new Carrefour 2
Slide 3: A New Step Forward
A NEW STEP FORWARD LARS OLOFSSON 3
Slide 4: Time for a new step forward
Time for a new step forward Carrefour now well on the way to its reinvention with the Transformation Plan continuing to deliver Carrefour Planet rollout now fully underway after successful pilots Carrefour concentrating its focus on the Carrefour brand as it nears completion of its successful banner
Slide 5: Two decisive moves to support our strategy
Two decisive moves to support our strategy DIA Carrefour Group Full spin‐off of hard …while driving greater …to concentrate on discount operations… value from real estate… retailing excellence Focus DIA resources on Create value with Focus all our resources developing its brand Carrefour’s G3 real o
Slide 6: DIA spin-off enables focus on one brand and banner
DIA spin‐off enables focus on one brand and banner Both Carrefour and DIA will benefit from a single‐minded focus – Different business models with different growth drivers – Different brands, product offer, pricing policy and cost structure – Completely separate HQ, loyalty program, human resources,
Slide 7: Carrefour Property: Major strategic and operating benefits for Carrefour
Carrefour Property: Major strategic and operating benefits for Carrefour Real estate development strategy supporting Carrefour’s hypermarket reinvention – Increasing traffic: an objective shared by both Carrefour Planet and Carrefour Property Real Estate: – More attractive commercial centers around
Slide 8: Real estate: A dual approach
Real estate: A dual approach Carrefour real estate portfolio at end 2010 (€17.2bn)1 Mature markets Growth markets Italy Other Asia 7% Europe 13% Spain 40% 24% Latin 69% France 47% America € 10.4bn €€ 6.8bn 6.8bn Develop and manage International expansion our sites to enhance drives portfolio growth
Slide 9: Carrefour Property: Fully embracing Carrefour's real estate opportunities
Titre lcmlksjefpejrpejr Kfdjefjepjr Carrefour Property: Fully embracing Carrefour’s real estate opportunities PASCAL DUHAMEL 9
Slide 10: Carrefour Property: A leading European retail real estate company
Carrefour Property: A leading European retail real estate company 4.4m 4.4m sqm sqm of of commercial commercial area, area, €10.4bn €10.4bn of of Significant scale Gross Gross Asset Asset Value, Value, approx. approx. 900 900 Carrefour Carrefour stores stores of of which which 300+ 300+ hypermarkets
Slide 11: A strong footprint in all of Carrefour's G3 countries
A strong footprint in all of Carrefour’s G3 countries France France Spain Italy Total Hypermarkets Supermarkets 2.5 0.7 10.4 1.7 GAV GAV 5.5 (€bn) (€bn) 1.2 0.2 4.4 Commercial Commercial 1.2 area area 1.8 (m (msqm) sqm) 7.6% 6.9% 6.6% 6.5% Capitalization Capitalization 5.9% rate rate(%) (%) 703 175
Slide 12: The #1 retail property pure player in Europe
The #1 retail property pure player in Europe Total TotalGLA(b) GLA(b) (sqm 4.2 4.2 3.8 3.8 4.4 4.4 3.0 3.0 1.7 1.7 5.0 5.0 2.2 2.2 1.3 1.3 1.8 1.8 2.6 2.6 0.8 0.8 0.7 0.7 0.7 0.7 0.6 0.6 0.9 0.9 0.7 0.7 0.8 0.8 1.1 1.1 (sqmm) m) Retail Non retail GAV GAV byby 17.1 asset asset 11.4 10.4 type type 7.1
Slide 13: A fully integrated real estate operator within the Carrefour group
A fully integrated real estate operator within the Carrefour group Asset Property Expansion Development management Management Source Improve Collect rents Develop Design Redesign Manage network Build Rebuild Lease Optimize leasing Operate Carrefour Property Carrefour Carrefour Carrefour G3 Property
Slide 14: An experienced team of real estate professionals delivering value
An experienced team of real estate professionals delivering value Pascal Duhamel Denis André John Ozinga Justo Martin Andrea Orsa Picture Picture Picture Picture Managing Director Managing Director Managing Director Responsibilities CEO CFO France Spain Italy # of years in the real estate 21 8 20 27
Slide 15: Secured lease agreements for both Carrefour Property and Carrefour
Secured lease agreements for both Carrefour Property and Carrefour 12‐year 12‐year initial initial firm firm leases leases Terms Sequential Sequential renewal renewal options options (up (up to to 80 80 years years of of leases leases in in France) France) Fixed Fixed rents, rents, fully fully index
Slide 16: A highly attractive 5-year pipeline
A highly attractive 5‐year pipeline AA €2.0bn €2.0bn pipeline pipeline Size 100 100 identified identified projects projects AA 10% 10% average average yield yield on on cost, cost, representing representing aa Value creation 350bps 350bps spread spread on on existing existing portfolio portfolio Sho
Slide 17: €2.0bn value-creating pipeline offering a 10% yield on cost
€2.0bn value‐creating pipeline offering a 10% yield on cost Pipeline by type (value) Pipeline by geography (value) Average expected yield on cost Development of new projects Spain France France 8.7% 40% 33% 54% Spain 12.8% 13% Italy 9.2% 60% Italy Avg. yield on cost: approx. 10% Development of exist
Slide 18: Three levers to generate value from €2bn pipeline
Three levers to generate value from €2bn pipeline > Extend galleries on existing sites Shopping Shopping center center 1 > Optimize existing shopping center organization 37 projects redevelopment redevelopment > When needed, asset acquisition to reunify ownership > Build new commercial surfaces cont
Slide 19: Case study: shopping center redevelopment
1 Case study: shopping center redevelopment Coll D’en Rabassa, Palma de Mallorca (Spain) Current site • Hypermarket area 12,206 sqm • Current shopping mall area (GLA) 8,470 sqm Proposed project • Opportunity to be the island’s largest shopping center • Outstanding location and accesses • Built next
Slide 20: Case study: creation of retail parks
2 Case study: creation of retail parks Claira, Perpignan (France) Current site • Hypermarket area 10,000 sqm • Klépierre‐owned shopping mall 5,500 sqm Proposed project • Creation of a Retail Park next to the Carrefour hypermarket and extension/renovation of the existing shopping center • This projec
Slide 21: Case study: new developments
3 Case study: new developments Troyes, L’Escapade ‐ La Chapelle St Luc (France) Proposed project • Urban convenience shopping center comprising a retail brand mix based on clothing, culture and leisure • Hypermarket sales area 7,000 sqm • Shopping center area 6,500 sqm • Retail park area 15,000 sqm
Slide 22: Case study: new developments
3 Case study: new developments Trieste (Italy) Proposed project • City‐center shopping center in a strategic location • Mixed‐use project (housing and retail) • A 30‐unit convenience shopping center • Hypermarket area 4,800 sqm • Gallery Area 7,000 sqm Key figures Capex (M€) 24.0 Yield on cost 8% Sq
Slide 23: Further upside potential to be captured in current portfolio
Further upside potential to be captured in current portfolio Approx. 200 locations with potential for improvement 67% Approx. 100 projects identified of which 75% are secured 33% Existing Existing pipeline pipeline €2.0bn €2.0bn 23 23
Slide 24: 2015 objectives
2015 objectives 2010 – 2015 net rent development CAGR: CAGR: 6.8% Impact of potential 3.9% disposal of French +€200m supermarkets (b) €820m €676m +€65m(a) Up to (€120m) Pipeline 30% 8% Rent indexation €940m 92% 70% 2010 PF Stores Shopping centers 2015E (a) Rent indexation assumptions: France (stores
Slide 25: Carrefour Property: focused on growth
Carrefour Property: focused on growth Strong Strong >>Completion Completionof of€2.0bn €2.0bnpipeline pipeline >>Net Net rental income of €820mboosted rental income of €820m boostedby bynew newprojects projects confidence confidence in in (from (from€676m €676minin2010) 2010) 2015 2015 targets targe
Slide 26: Value creation circle between Carrefour and Carrefour Property
Value creation circle between Carrefour and Carrefour Property Strong property Strong anchor tenant company Strength of Carrefour Enhancement of Carrefour Property Solid asset base brand assets through traffic resulting from the strength of Carrefour brand and initiatives Leading food retailer Attra
Slide 27: Carrefour's pro-forma financials post DIA spin-off
Titre lcmlksjefpejrpejr Kfdjefjepjr Carrefour’s pro‐forma financials post DIA spin‐off PIERRE BOUCHUT 27
Slide 28: Proposed transaction structure
Proposed transaction structure Carrefour shareholders would receive 100% of DIA shares as a special dividend Structure Structure Parity: 1 DIA share for 1 Carrefour share Transaction subject to Carrefour EGM approval on June 21st Requirements Requirements Registration document approved by CNMV Final
Slide 29: Preliminary remarks
Preliminary remarks Full‐year Full‐year 2010 2010 Carrefour Carrefour _ 2010 2010 DIA DIA published published +_ impact impact of carve‐out carve‐out on of on = 2010 2010 Carrefour Carrefour published published Carrefour Carrefour pro‐forma pro‐forma result result Carrefour’s 2010 published accounts
Slide 30: Carrefour 2010 pro-forma key figures
Carrefour 2010 pro‐forma key figures 2010 2010 DIA Carrefour 2010 (€m) published published1 adjustments2 pro‐forma4 % chg. Net sales 90,099 9,588 80,511 (10.6 %) EBITDA3 4,972 517 (44) 4,411 (11.3 %) Current Operating Income 2,972 241 (44) 2,688 (9.6 %) Net income, Group share, 1,380 112 (1) 1,267 (
Slide 31: Carrefour 2010 pro-forma income statement
Carrefour 2010 pro‐forma income statement (€m) 2010 2010 DIA Carrefour 2010 published published1 adjustments2 pro‐forma4 Net sales 90,099 9,588 80,511 EBITDA3 4,972 517 (44) 4,411 Margin 5.5% 5.4% 5.5% Current Operating Income 2,972 241 (44) 2,688 (€44m) composed of (€14m) purchasing Margin 3.3 % 2.
Slide 32: 2010 pro-forma balance sheet structure including carve-out impacts
2010 pro‐forma balance sheet structure including carve‐out impacts (€m) 2010 2010 DIA Carrefour 2010 published published1 adjustments2 pro‐forma3 Non current assets 31,327 2,527 28,800 Working capital (7,247) (1,016) (6,233) Inventories 6,994 535 6,458 Receivables 2,555 137 2,418 Payables (16,796) (
Slide 33: Unchanged sound financial structure post DIA spin-off
Unchanged sound financial structure post DIA spin‐off 2010 2010 S&P BBB+ Stable outlook published pro‐forma3 Moody's Baa1 Stable outlook EBITDA / Financial costs 7.6x 7.3x Fitch A‐ Rating watch negative Gearing 75.7% 72.6% Net debt / EBITDA 1.6x 1.7x DIA spin‐off has a neutral impact on Carrefour’s
Slide 34: Four key agreements between DIA and Carrefour
Four key agreements between DIA and Carrefour 3‐year partnership agreement for private label purchasing in France and Spain – Continue to leverage existing purchasing synergies over coming three years – Synergies estimated at €10m for DIA and €35m for Carrefour on 2010 pro‐forma accounting basis – E
Slide 35: Conclusion
Titre lcmlksjefpejrpejr Kfdjefjepjr CONCLUSION LARS OLOFSSON 35
Slide 36: Update on trading environment
Update on trading environment Characterized overall by major increases in raw material prices impacting supplier negotiations France – unsatisfactory year‐to‐date performance – CEO temporarily taking direct control – Realignment of commercial policy: consistent promotional policy, improved promotion
Slide 37: New Carrefour: Leaner, stronger, more focused, more dynamic
New Carrefour: Leaner, stronger, more focused, more dynamic Large Large turnover turnover €90 billion (2010 pro‐forma sales including VAT) Strong Strong position position No. 1 retailer in Europe No. 2 retailer globally Streamlined Streamlined operations operations Focused on one brand, one banner D
Slide 38: Appendix
Titre lcmlksjefpejrpejr Kfdjefjepjr APPENDIX 38
Slide 39: 2010 Key Financials Reconciliation
2010 Key Financials Reconciliation Carrefour (€m) DIA Registration Erteco Stock‐ Impairment Discontinuing Reference Document options activities Document Net sales 9,588 9,588 Adjusted EBITDA cash1 507 4 5 517 Current Operating Income 231 4 5 241 Net income, Group share 2 122 4 5 (45) (79) 8 1. The “