Casino, Guichard-perrachon Sa · EURONEXT:CO
Casino, Guichard-perrachon Sa — Groupe Casino — H1 2014 Earnings Presentation
63 slides from Casino, Guichard-perrachon Sa's earnings presentation, Jul 29, 2014
Slide 1: Half-Year Results 2014
GROUPE gp” Casino NOURISHING A OF RESULTS
Slide 2: H1 2014 Key Figures (Continuing Operations)
H1 2014 KEY FIGURES (CONTINUING OPERATIONS) H1 2014 Organic change vs. H1 2013 published Consolidated net sales €23,248m +6.0% EBITDA €1,353m +9.1% EBITDA margin 5.8% +17 bp Trading profit €880m +13.3% Trading margin 3.8% +26 bp Net underlying profit, Group share €176m +5.8% * Cash flow €865m +9.3%
Slide 3: H1 Adversely Affected by Exchange Rates
H1 WAS ADVERSELY AFFECTED BY EXCHANGE RATES WHICH, EVERYTHING ELSE BEING EQUAL, SHOULD STABILIZE IN H2 AVERAGE EXCHANGE RATE SPOT RATE Chg. % H1 2013 H1 2014 Chg.% H2 2013 On July 25 vs. H2 2014 2013 Brazil 2.6688 3.1499 -15.3% 3.0347 2.9968 +2.1% (BRL / EUR) Colombia (COP / EUR) 2.3995 2.6856 -10.7
Slide 4: Q1 2014 Net Sales
Q1 2014 NET SALES H1 2014 Highlights Results Conclusion Appendices Jean-Charles NAOURI Chairman and Chief Executive Officer 29 July 2014 Half-Year Results 2014
Slide 5: Total Group Sales of €11.9 Billion in Q2
TOTAL GROUP SALES OF €11.9 BILLION IN Q2, WITH ORGANIC GROWTH OF +6.5%* CHANGE IN CONSOLIDATED NET SALES in €m Q2 2014 Organic change Organic change Q2 2014/Q2 2013* Q1 2014/Q1 2013* Total continuing operations 11,932.6 +6.5% +6.6% France 4,847.2 -0.2% -1.8% International 7,085.3 +10.9% +11.0% In
Slide 6: Ongoing Sequential Improvement in Activity in France in Q2
ONGOING SEQUENTIAL IMPROVEMENT IN ACTIVITY IN FRANCE IN Q2 ORGANIC SALES GROWTH* in % Q3 2013 Q4 2013 Q1 2014 Q2 2014 -0.2% -1.4% -1.8% -3.6% +2.1% growth in same-store sales excluding petrol at Géant hypermarkets (+1.1% vs. -0.1% in Q1 2014 excluding calendar) Improvement relative to Q1 in Casi
Slide 7: International: Continuing Strong Organic Growth, Driven by Brazil
INTERNATIONAL: CONTINUING STRONG ORGANIC GROWTH, DRIVEN IN PARTICULAR BY BRAZIL ORGANIC SALES GROWTH* in % Latin America Asia 15.8% 13.5% 12.5% 12.3% 10.3% 9.9% 8.7% 8.5% 8.5% 5.2% 5.1% 3.3% Q1 2013 Q2 2013 Q3 2013 Q4 2013 Q1 2014 Q2 2014 Latin America posted very strong organic growth, excluding
Slide 8: Very Strong Growth in E-commerce Activity
VERY STRONG GROWTH IN E-COMMERCE ACTIVITY GROWTH IN CDISCOUNT ACTIVITY GROWTH IN NOVA PONTOCOM ACTIVITY in % in % Q2 Q2 Change Q2 Q2 Change (in €m) 2013** 2014 (in BRLm) 2013** 2014 Net sales 278.0 326.6 +17.5% CA net 950.3 1,306.9 +37.5% GMV* 376.2 466.1 +23.9% GMV* 1,064.7 1,534.2 +44.1% Units sol
Slide 9: H1 2014 Highlights
Q1 2014 Net sales H1 2014 HIGHLIGHTS Results Conclusion Appendices Jean-Charles NAOURI Chairman and Chief Executive Officer 29 July 2014 Half-Year Results 2014
Slide 10: Back to Positive Sales Momentum
BACK TO POSITIVE SALES MOMENTUM Géant now offers an excellent pricing profile Numerous commercial initiatives have contributed to the banner revitalisation In Q2 2014 +3% growth of in food sales excluding calendar Same-store growth* in Q2 2014 +2.1% Pronounced recovery in non-food volumes
Slide 11: Price Repositioning Now Completed
PRICE REPOSITIONING NOW COMPLETED The banner is now positioned as the least expensive in the market** Traffic improved gradually over the second quarter and turned positive in June excluding calendar effect In Q2 2014 Total sales benefited from the integration of recent acquisitions (Le Mutant
Slide 12: Good Resilience of Supermarket Banners
GOOD RESILIENCE OF SUPERMARKET BANNERS… MONOPRIX Monoprix sales were affected by the change in evening closing time for some stores Expansion continuing at a satisfactory pace The banner’s profitability remains highly satisfactory with good textiles sales CASINO SUPERMARKETS Continuing growt
Slide 13: …And the Other Convenience Banners
…AND THE OTHER CONVENIENCE BANNERS FRANPRIX Roll-out of loyalty card is complete Good performance of the banner with a gradual resumption of expansion in the second half of 2014 CONVENIENCE Gradual improvement in the competitiveness and attractiveness of the Vival and Spar franchise networks
Slide 14: Brazil: Excellent Performance of GPA at Consolidated Level
BRAZIL: EXCELLENT PERFORMANCE OF GPA AT CONSOLIDATED LEVEL The three activities of GPA achieved good performance during the semester Organic growth* of +12.7% in the second quarter of 2014 and strong growth in profitability over the first half Very good performances, both at the food banners (
Slide 15: GPA: Very Good Progression of Food Banners
GPA: VERY GOOD PROGRESSION OF FOOD BANNERS Strong growth in the second quarter of 2014 Good performance of supermarket banners In Q2 2014 and excellent performance of Assaí Same-store growth Continuing expansion with 25 stores opened in Q2 excluding petrol and the opening of the first convenie
Slide 16: Viavarejo: Continuing Improvement in Profitability
VIAVAREJO: CONTINUING IMPROVEMENT IN PROFITABILITY Good performance in H1 2014 in terms of both sales and margin Fast execution of operational excellence plans In Q2 2014 (logistics, stores and head office) enabling a reduction Same-store growth* in general expenses as a percentage of sales +6.4
Slide 17: Increase in Activity and Profitability
INCREASE IN ACTIVITY AND PROFITABILITY Sustained organic growth thanks to the success of major commercial initiatives The acquisition of the Super Inter group, which will add 50 new stores as a whole, In Q2 2014 is proceeding in a satisfactory manner Organic growth* Continuing expansion, parti
Slide 18: Solid H1 2014 Performance in a Difficult Environment
SOLID H1 2014 PERFORMANCE IN A DIFFICULT ENVIRONMENT THAILAND Strengthened leadership in terms of price image and successful promotional initiatives Gradual improvement in same-store sales, following two quarters adversely affected In Q2 2014 by the political situation Organic growth* Very rob
Slide 19: Organic Growth Continues in H1
ORGANIC GROWTH CONTINUES IN H1 VIETNAM Strong organic sales growth Development of commercial galleries In Q2 2014 Ongoing expansion with 2 hypermarkets and 1 supermarket opened in the first half, Organic growth* bringing the total number of stores to 28 +9.4% * Excluding petrol and calendar 29
Slide 20: Creation of an E-commerce Pole
CREATION OF AN E-COMMERCE POLE GMV up +23.9% for Cdiscount and +44.1% for Nova Pontocom in the second quarter On 6 May 2014, Casino announced its plan to create GMV* an e-commerce platform combining Cdiscount’s (in € billion) 3.6 activities in France, Colombia and Asia 2.3 2.8 3.1 with those of
Slide 21: Results
Q1 2014 Net sales H1 2014 Highlights RESULTS Conclusion Appendices Antoine GISCARD D’ESTAING Chief Financial Officer 29 July 2014 Half-Year Results 2014
Slide 22: Preliminary Notes
PRELIMINARY NOTES The 2014 first-half results were affected by several changes in consolidation scope Change to equity accounting method for Mercialys, which had been fully consolidated in the first half of 2013 Full consolidation of 100% of Monoprix Equity interest in GPA raised to 41.3% wi
Slide 23: Good Organic Growth in Activity and Earnings in H1 2014
GOOD ORGANIC GROWTH IN ACTIVITY AND EARNINGS IN H1 2014 CONTINUING OPERATIONS H1 2013 H1 2014 Organic (in € millions) published* growth Net sales 23,703 23,248 +6.0% EBITDA** 1,381 1,353 +9.1% EBITDA margin 5.8% 5.8% Trading profit 894 880 +13.3% Trading margin 3.8% 3.8% The Group’s consolidated s
Slide 24: France Retail: Resilient Total Margin Against Price Cuts
FRANCE RETAIL: RESILIENT TOTAL MARGIN AGAINST A BACKDROP OF PRICE CUTS CONTINUING OPERATIONS H1 2013 H1 2014 (in € millions) published* Net sales 8,935 9,248 EBITDA** 394 384 Trading profit 191 165 Trading margin 2.1% 1.8% This segment comprises the activities of the Casino, Monoprix, Franprix-Lea
Slide 25: Latam Retail: Strong Organic Growth in Trading Profit
LATAM RETAIL: STRONG ORGANIC GROWTH IN TRADING PROFIT CONTINUING OPERATIONS H1 2013 H1 2014 Organic CER* (in € millions) published growth growth Net sales 7,795 7,305 +11.6% +10.2% EBITDA* 545 500 +10.3% +7.9% Trading profit 353 342 +18.4% +14.2% Trading margin 4.5% 4.7% This segment comprises the
Slide 26: Latam Electronics: Continuing Strong Growth in Earnings
LATAM ELECTRONICS: CONTINUING STRONG GROWTH IN EARNINGS CONTINUING OPERATIONS H1 2013 H1 2014 Organic CER* (in € millions) published growth growth Net sales 3,843 3,477 +6.8% +6.8% EBITDA* 273 304 +32.1% +32.1% Trading profit 244 276 +34.2% +34.3% Trading margin 6.3% 7.9% This segment comprises th
Slide 27: Asia Retail: Margin Growth Despite Difficult Environment
ASIA RETAIL: MARGIN GROWTH DESPITE A DIFFICULT ENVIRONMENT CONTINUING OPERATIONS H1 2013 H1 2014 Organic CER* (in € millions) published growth growth Net sales 1,828 1,692 +4.2% +4.2% EBITDA* 167 159 +7.1% +7.1% Trading profit 114 107 +6.0% +6.0% Trading margin 6.2% 6.3% This segment comprises the
Slide 28: E-commerce: Strong Growth in Activity and Positive EBITDA
E-COMMERCE: STRONG GROWTH IN ACTIVITY AND POSITIVE EBITDA CONTINUING OPERATIONS H1 2013 H1 2014 Organic CER* (in € millions) published growth growth Net sales 1,302 1,526 +29.4% +28.9% EBITDA* 2 7 n.s. n.s. Trading profit (9) (9) n.s. n.s. This segment includes the activities of Cdiscount, of its
Slide 29: Underlying Profit at Current Exchange Rates
UNDERLYING PROFIT AT CURRENT EXCHANGE RATES H1 2013 H1 2014 (in € millions) underlying published underlying TRADING PROFIT 969 880 Finance costs, net (309) (311) Other financial income and expense, net (4) 15 Income tax expense (192) (179) Share of profit of associates (2) 30 PROFIT FROM CONTINUING
Slide 30: Stable Finance Costs
STABLE FINANCE COSTS H1 H1 (in € millions) 2013 published 2014 France (130) (122) Brazil (183) (192) Thailand (13) (10) Other international 17 13 TOTAL (309) (311) Increase in the charge related to finance costs in Brazil in a context of rising interest rates 29 July 2014 Half-Year Results 2014 30
Slide 31: Underlying Minority Interests
UNDERLYING MINORITY INTERESTS H1 H1 (in € millions) 2013 published 2014 FPLP (3) (4) GPA 169 195 Big C Thailand 32 30 Exito 36 34 Other 4 5 Mercialys* 30 0 TOTAL 268 259 Slight decrease in minority interests taking into account two opposing movements: Equity accounting of Mercialys Increase in
Slide 32: +5.8% Growth in Net Underlying Profit at Constant Exchange Rates
+5.8% GROWTH IN NET UNDERLYING PROFIT AT CONSTANT EXCHANGE RATES H1 2013 H1 2014 underlying underlying (in € millions) published at CER* TRADING PROFIT 969 1,008 Finance costs, net (309) (346) Other financial income and expense, net (4) 17 Income tax expense (192) (207) Share of profit of associates
Slide 33: Net Underlying Profit per Share
NET UNDERLYING PROFIT PER SHARE H1 2013 H1 2014 Change CONTINUING OPERATIONS (in €m) published Net underlying profit at current 183.1 159.5 -12.9% exchange rates Net underlying profit at constant 183.1 187.9 +2.6% exchange rates Average number of shares (millions) 112.8 113.1 +0.2% Underlying EPS at
Slide 34: Change in Group Net Financial Debt
CHANGE IN GROUP NET FINANCIAL DEBT in €m (1,449) (582) 255 (81) 1,158 (288) (8,856) 2,006 (7,836) Cash Change Net Financial Net financial Dividends Other flow in WCR CAPEX operations investments paid (in €m) H2 2013 1,141 1,558 (766) H1 2014 865 (1,639) (682) NFD NFD 30/06/2013 30/06/2014 Net fina
Slide 35: Strengthened Liquidity Position
STRENGTHENED LIQUIDITY POSITION €2.9m IN LIQUIDITY* AT 30/06/2014 BOND MATURITIES** WELL SPREAD OVER TIME in €m in €m 1,000 1,000 2,187 900 850 750 552 600 689 508 386 Cash and cash Undrawn equivalents confirmed lines 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 of credit On 28 February 2014,
Slide 36: Conclusion
Q1 2014 Net sales H1 2014 Highlights Results CONCLUSION Appendices Jean-Charles NAOURI Chairman and Chief Executive Officer 29 July 2014 Half-Year Results 2014
Slide 37: H1 2014 Highlights (1/2)
H1 2014 HIGHLIGHTS (1/2) The first half was marked by the recovery of Géant hypermarkets, in line with the roadmap Improvement in traffic and steady growth in volumes since the end of 2013 Following completion of its pricing investments, Leader Price is currently positioned as the least expens
Slide 38: H1 2014 Highlights (2/2)
H1 2014 HIGHLIGHTS (2/2) In Brazil, the managerial control achieved has resulted in good operating performances, in terms of both business development and profitability Casino’s stake in GPA was raised from 38.1% to 41.3% Under the impact of numerous action plans, GPA’s consolidated margin ros
Slide 39: Continued Implementation of the Group's Strategic Priorities: Discount Banners
CONTINUED IMPLEMENTATION OF THE GROUP’S STRATEGIC PRIORITIES 1 Roll out of the discount banners In France, at end of H1 2014, successful price repositioning of Géant and completion of that of Leader Price Géant presents an excellent pricing profile Leader Price is now the least expensive retai
Slide 40: Strategic Priorities: Premium Formats and Convenience
CONTINUED IMPLEMENTATION OF THE GROUP’S STRATEGIC PRIORITIES 2 Strengthening positioning on premium formats Strengthening the unique positioning on Monoprix, Carulla (Colombia) and Pão de Açúcar (Brazil) 3 Accelerating expansion in convenience In France, continued expansion, in particular under
Slide 41: Strategic Priorities: Non-food E-commerce
CONTINUING IMPLEMENTATION OF THE GROUP’S STRATEGIC PRIORITIES 4 Becoming a major player in non-food e-commerce In 2013, the Casino group achieved a GMV of €3.6 billion in non-food e-commerce, in Brazil and France Cdiscount is currently one of the leading players in non-food e-commerce in France
Slide 42: Conclusion: Group Confirms Its 2014 Objectives
CONCLUSION The Group confirms its objectives for 2014: A return to positive organic sales growth in France Continued strong organic sales growth internationally Further trading profit growth in organic terms Continued improvement in the financial structure 29 July 2014 Half-Year Results 20
Slide 43: 29 July 2014
29 July 2014 29 July 2014 Half-Year Results 2014
Slide 44: Appendices
Q1 2014 Net sales H1 2014 Highlights Results Conclusion APPENDICES 29 July 2014 Half-Year Results 2014
Slide 45: Change in Same Store Sales Excluding Petrol
CHANGE IN SAME STORE SALES EXCLUDING PETROL France Q1 2014 Q2 2014 H1 2014 HM Géant -1.6% +2.1% +0.4% Casino SM -3.4% -1.2% -2.3% Franprix -3.4% -3.0% -3.2% Leader Price -9.5% -8.8% -9.2% Monoprix -1.2% -1.0% -1.0% International Q1 2014 Q2 2014 H1 2014 Latin America +6.1% +10.0% +8.1% Asia -2.3% -2.
Slide 46: Calendar Effects
CALENDAR EFFECTS Q2 2014 H1 2014 Géant Hypermarkets +1.0% -0.2% Casino Supermarkets +0.9% 0% Superettes +0.2% 0% Monoprix +0.2% -0.1% FPLP -0.5% -0.3% France +0.4% -0.2% International +1.1% -0.3% Group +0.9% -0.3% 29 July 2014 Half-Year Results 2014 46
Slide 47: Detailed Income Statement
DETAILED INCOME STATEMENT CONTINUING OPERATIONS H1 2013 H1 2013 H1 2014 (in € millions) adjusted* published Trading profit 933 969 880 Other operating income and expense, net 533 530 (174) Finance costs, net (310) (309) (311) Other financial income and expense, net (31) (31) 32 Profit before tax 1,1
Slide 48: Definition of Underlying Profit
DEFINITION OF UNDERLYING PROFIT Underlying profit corresponds to net profit from continuing operations adjusted for the impact of other operating income and expense (as defined in the “Significant Accounting Policies” section of the notes to the annual consolidated financial statements), non-recur
Slide 49: From Reported Net Profit to Underlying Net Profit
FROM REPORTED NET PROFIT TO UNDERLYING NET PROFIT H1 2013 Adjustments H1 2013 H1 2014 Adjustments H1 2014 (in € millions) published underlying underlying Trading profit 969 969 880 0 880 Other operating income and expense, net 530 (530) 0 (174) 174 0 Operating profit 1 499 (530) 969 706 174 880 Fina
Slide 50: Breakdown of EBITDA and Trading Profit - France
BREAKDOWN OF EBITDA AND TRADING PROFIT - FRANCE H1 2013 published H1 2014 (in € millions) EBITDA - Retail France 394 384 Franprix-Leader Price 112 50 Monoprix 138 183 Casino France* 144 151 (in € millions) H1 2013 published H1 2014 Trading Profit - Retail France 191 165 Franprix-Leader Price 68 5 Mo
Slide 51: Breakdown of Trading Profit - International
BREAKDOWN OF TRADING PROFIT - INTERNATIONAL (in € millions) H1 2013 published H1 2014 TRADING PROFIT - INTERNATIONAL 711 725 Latin America 597 618 Asia 114 107 29 July 2014 Half-Year Results 2014 51
Slide 52: Other Operating Income and Expenses
OTHER OPERATING INCOME AND EXPENSES (in € millions) H1 2013 published H1 2014 Capital gains or losses on asset disposals 59 (1) Other operating income and expense, net 471 (173) Net income or expense related to scope operations 621 (52) Net impairment of assets (25) (11) Provisions and charges for r
Slide 53: Détail des autres produits et charges financiers
DÉTAIL DES AUTRES PRODUITS ET CHARGES FINANCIERS H1 2013 published H1 2014 (in € millions) Change in derivatives excluding hedging instruments (14) 30 Foreign exchange gains and losses off-NFD (4) 5 Discounting adjustments (7) (8) Other (6) 4 TOTAL (31) 32 29 July 2014 Half-Year Results 2014 53
Slide 54: Share of Profit of Associates
SHARE OF PROFIT OF ASSOCIATES H1 2013 published H1 2014 (in € millions) France (6) 7 International 4 23 TOTAL (2) 30 29 July 2014 Half-Year Results 2014 54
Slide 55: Cash Flow Statement
CASH FLOW STATEMENT (in € millions) H1 2013 published H1 2014 Net financial debt at beginning of period (6,260) (5 502) Cash flow 894 865 Change in working capital requirement (1,136) (1,639) Other* 374 224 Net cash flow from operating activities, after tax 132 (550) Capital expenditure (782) (693)
Slide 56: Breakdown of Change in WCR
BREAKDOWN OF CHANGE IN WCR CHANGE IN WCR H1 2013 published H1 2014 (in € millions) “Goods” France (327) (325) “Goods” International (319) (755) “Non-goods” (490) (559) TOTAL (1,136) (1,639) 29 July 2014 Half-Year Results 2014 56
Slide 57: Simplified Consolidated Balance Sheet
SIMPLIFIED CONSOLIDATED BALANCE SHEET (in € millions) 31/12/2013 published 30/06/2014 Goodwill 10,791 11,177 Intangibles and property, plant and equipment 14,128 14,745 Investments in associates 768 908 Non-current assets 1,593 1,912 Other non-current assets 425 589 Inventories 4,693 5,001 Trade and
Slide 58: Puts Included in Net Financial Debt
PUTS INCLUDED IN NET FINANCIAL DEBT % capital Value Value Exercise at 31/12/2013 at 30/06/2014 period (in € millions) Franprix - Majority-owned 48 48 Various dates Leader Price franchise stores Monshowroom 10 0 Various dates At any time Uruguay 15 14 2021 At any time Other 1 1 2014 TOTAL 75 63 2
Slide 59: Puts Hors Bilan
PUTS HORS BILAN % capital Value Value Exercise at 31/12/2013 at 30/06/2014 period (in € millions) Franprix - Minority-owned 71 73 Various dates Leader Price franchise stores At any time Uruguay (Disco) 87 82 2021 TOTAL (off-balance 158 155 sheet) 29 July 2014 Half-Year Results 2014 59
Slide 60: Average Exchange Rates
AVERAGE EXCHANGE RATES Q1 2013 Q1 2014 Chg. % H1 2013 H1 2014 Chg. % Argentina (ARS / EUR) 6.6187 10.3805 -36.2% 6.7345 10.7101 -37.1% Uruguay (UYP / EUR) 25.3291 30.2755 -16.3% 25.4438 30.9096 -17.7% Thailand (THB / EUR) 39.3425 44.7221 -12% 39.2025 44.6170 -12.1% Vietnam (VNB / EUR) (x 1,000) 27.4
Slide 61: Shareholder Structure and Breakdown of GPA Minority Interests
SHAREHOLDER STRUCTURE AND BREAKDOWN OF GPA MINORITY INTERESTS 41.3%** 43.3%* 52.4%*** 44.0%*** Minority interests 58.7%** Minority interests Minority interests 3.6%*** 56.7%* AT 30 JUNE 2014 ECONOMIC INTEREST GPA Food Viavarejo Nova.com (in %) Casino Group 41.3% 17.9% 29.5% Minority interests 58.7%
Slide 62: Disclaimer
DISCLAIMER This presentation contains forward-looking information and statements about Casino. Forward-looking statements are statements that are not historical facts. These statements include financial projections and estimates and their underlying assumptions, statements regarding plans, objective
Slide 63: 29 July 2014
29 July 2014 29 July 2014 Half-Year Results 2014