Company presentation February 2020
First choice for anyone who wants to shop convenient, smart, big and at low price 3
Retail is changing 1980s 1990s 2000s Today Local stores One-stop shopping, Online retailing is born Omnichannel retail larger malls 4
In a world of winners and losers, variety retail is thriving While online is challenging bricks-and- mortar… Variety retail has grown ~twice the speed of all retail Variety retail 1 Online share of retail sales Sales growth total vs. variety retail Percent CAGR 2012-17, constant Total retail 16 +10.8 p.p. 5.7% 2% 14 +7.5 p.p. 4.7% 12 +5.0 p.p. 3% 10 +3.9 p.p. 2% 8 +5.4 p.p. 0.5% 6 6.5% 4 3% 2 6.5% 0 3% 2007 2012 2017 1 General retailers with wide discount range. 5 Source: Euromonitor International; see appendix for full presentation
Norway’s #1 discount variety retailer • 32 million customer transactions in 2019 Customers • Widely recognised brand and price position 1 • 1 million leaflets in distribution Marketing • Around 400 000 subscribers to digital newsletter • Cost-efficient locations and operations Stores • 234 of 249 like-for-like (LFL) stores profitable in 2019 • Track-record of 15 new or relocated stores p.a. • More than 40 years of wholesaler experience 264 Logistics • Efficient set-up and nationwide reach • New modern central warehouse from Q2 2019 • From more than 30 countries Sourcing Stores • Pan-Nordic agreement with ÖoB and Tokmanni 1 Mediacom annual market survey 6
Europris – 27 years with growth NOK million 25 years of JV with Listing growth Tokmanni on Store #250 and opened Oslo Shanghai Børs 6 000 sourcing office Acquired by 5 000 Nordic Capital Central warehouse 4 000 opened in Acquired by Fredrikstadal Store Founded by IK #150 3 000 Wiggo Investment Erichsen Partners 2 000 Store #100 Wholesale agreement with 1 000 Terje Høili AS 0 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 7
With a strong brand 100% #1 Recognition Price perception Source: Mediacom annual market survey 8 Ranking among wide variety retailers (Biltema, Clas Ohlson, Coop OBS, Europris, Jernia, Jula, Jysk, Nille, Plantasjen, Rusta)
Like-for-like growth above the market % points LFL growth (%) 8% 4.3 3.1 1.7 2.2 1.4 3.9 10% 7,0 % 8% 6% 5,4 % 6% 4,4 % 4,1 % 4% 3,1 % 4% 2,7 % 2,4 % 2,3 % 2,2 % 2% 2% 0,9 % 0,8 % 0,5 % 0% 0% 2014 2015 2016 2017 2018 2019 Market Europris Gap Europris LFL growth rate in excess of market growth rate in the period % points 9 Source: Kvarud analyse, Shopping Centre Index and Europris
Track record of above-market growth Revenue and EBITDA margin 1 Total growth for Europris and market 2,3 6,3 NOK billion 9,3% 5,8 5,4 8,4% 5,1 7,7% 4,6 4,3 6,4% 6,0% 5,3% 14% 13% 13% 12% 12% 11% 2014 2015 2016 2017 2018 2019 2014 2015 2016 2017 2018 2019 Europris Kvarud Revenue EBITDA margin 1 Europris group figures, excl. IFRS 16 effects 10 2 Europris chain figures 3 Kvarud Analyse: Norwegian shopping centre index
Our strategic focus areas Strengthen price Improve customer Drive customer and cost position experience growth 11
Strengthen price Improve customer Drive customer and cost position experience growth 12
Significant economies of scale from Nordic sourcing 2013 2018 2020 Tokmanni sourcing Europris acquires Option to acquire agreement 20% of ÖoB remaining shares in ÖoB Representing annual sales of NOK 18bn 13
Futureproofing distribution 14
Strengthen price Improve customer Drive customer and cost position experience growth 15
Constant category evaluation and refining Assortment optimisation In-store Redesigned optimisation packaging Our proven category management tools Improved Campaign in-store development communication Revitalised marketing 16
Continuous improvement of seasonal concepts • During the Christmas season, the product range within seasonal lightening was further improved • Assortment for outdoor system lighting was awarded “best in test” by Norwegian broadcaster TV2 • Product range is developed and sourced through the partnership with Tokmanni and ÖoB 17
Strengthen price Improve customer Drive customer and cost position experience growth 18
Bridging digital opportunities and physical stores Europris’ 360⁰ customer vision • Digital channels are an increasingly important supplement to the physical store • Reach new and younger customer groups SEARCH ENGINE Be relevant and build loyalty • WEB CAMPAIGN STORE CUSTOMER SERVICE • Take ownership of the customer’s purchase process LEAFLET • Stepwise roll-out of cost-effective digital platform and shift towards omnichannel strategy POSITIVE PRODUCT DIALOGUE OUR CHANNELS E-COMMERCE • Online is increasingly driving the whole purchase PR process from discovery to delivery • Price, selection, delivery, payment, support and service ONLINE ADVERTISING SOCIAL MEDIA 19 CRM CONTENT MARKETING
The online growth experience so far • Seamless and simple offering – the E-commerce revenue Monthly traffic on Europris.no key success factor 42 NOK million Million visitors 1,56 • New e-commerce platform making 1,25 progress, launch in H1 2020 32 1,04 • Centralised e-commerce mezzanine picking at new Moss warehouse 0,84 • Significantly improved product range 18 and service 10 • A complimentary source for revenue growth 2016 2017 2018 2019 • Complementary to the store offering 2016 2017 2018 2019 • Europris.no serves as driver for traffic to physical stores and add-on sales AVERAGE BASKET VALUE Home delivery Store Click & collect NOK 1 146 NOK 765 NOK 203 20
Drive customer growth by utilising existing store base and new opportunities • Two store relocations in the quarter • Nordfjordeid, Sogn og Fjordane • Voss, Hordaland • Three store expansions in the quarter • Vestkanten, Hordaland • Elnesvågen, Møre og Romsdal • Skien, Telemark • Six new stores opened in 2019 • Five stores in pipeline for 2020 and beyond • Two of the stores are subject to local authority planning processes • New stores opened in 2018/2019 perform well measured on a set of strict criteria's • Closing of the store at Grini postponed – Awaiting court The team at Europris Nordfjordeid decision, case scheduled for 21-23 April 21
On the quest to be the best The goal is to be the best in all four areas below Price Number 1 in price perception in Norway, the fight for lower prices continues Concept Continuous development, focus on customer need-based flow and distinct shop-in-shop Value chain and cost Nordic sourcing, new warehouse and automation of operations to improve further efficiency Execution and culture Continue to build on our strong company culture and dedicated employees 22
Be the best discount variety retailer in Europe Fogra Reklamefoto 23
Q&A Next event: Q1 presentation 23 April 2020
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