EUROCASH Empowering modern retail entrepreneurs Eurocash Group - - PowerPoint PPT Presentation

EUROCASH

Empowering modern retail entrepreneurs

Eurocash Group – executive summary

2

As wholesale distribution leader, Eurocash invests to improve small store competitiveness and growth

 With 27% market share serving most small stores including 13.5k soft franchisees, sales are of EUR 4.2 bn and EBITDA of EUR 95 m  Eurocash.pl is a fast growing e-commerce platform with sales of EUR 800 m, giving small store owners solutions comparable to modern trade

As the 7th largest retailer, the roll-up growth strategy for its supermarket chain brings synergy and upside

 With sales of Eur 1.7Bn from 1500 hard franchise and own stores, the objective is to add 900 stores in 5 years to become the 3rd largest retailer  The retail strategy builds on already-strong product categories of wholesale while helping Eurocash grow into new, under-represented ones  Eurocash’s experience with post-acquisition integration of distressed assets offers the prospect of strong upside from profit recovery

Cash generation funds continued investment to innovate in support of small stores in a changing industry

 Addressing the needs for automation, digitalization, and individualized customer offerings brings further competitiveness to small store formats  Following on investments of EUR 800 m over the last 10 years, today’s projects are at tipping point to show long-term benefits in growth and profitability

Through M&A and organic growth, Eurocash has built the broadest distribution and retail platform

 With Sales of EUR 5.5 bn, and EBITDA of EUR 85 m, cash flow generation is of approximately 133% of EBITDA  While many retailers failed in Poland , Eurocash built scale through M&A and its purchasing power has kept small format stores competitive  Today, Eurocash is the 2nd largest player, No.1 in branded FMCG sales, the dominant small store operator, and leads in several product categories

Poland’s sizeable market has unique traits that favor neighborhood stores

 GDP is of EUR 475 bn and population is of 38.4 m (EUR 26k per Capita PPP) but population density in large cities is quite low  Typically small living quarters lead to daily shopping nearby and has severely limited the success of “big box” retail formats

30,4% 33,2% 14,5% 12,5% 4,9% 4,1% 7,0% 8,8% 17,0% 18,9% 26,2% 22,5% 2018 2023E Others Minimarkets Proximity Supermarkets Large Supermarkets Hypermarkets Discounters

Poland is a unique market

3

Demographics: small towns, small living quarters, that necessitate daily shopping close to home

40% 13% 11% 8% 28%

Rura ral Ci Cities 0-2

• 20K

Ci Cities 20-5

• 50K

Ci Cities 50-1

• 100K

Ci Cities 100K+

 60% of Poles live in villages & small towns

Percentage of population living in cities/rural area

 Small living quarters have limited space to store food  As a result, most Poles shop almost every day

Source: GUS, Eurostat

 Total population of 38.4 M  GDP per Capita PPP of EUR 26.1k

Share of distribution channels in FMCG sales in Poland

Source: www.retailytics.com

50.2% 50.2% 19.4% 16.6%

Eurocash market Eurocash market

 GDP increase by 5.1% in 2018

Food market growth

Small format stores accelerating their growth

4

Source: Nielsen, Total Poland, All Food

Food market growth by channel

(FY 2018, YoY)

Food market growth in small format channels

(FY 2018, YoY)

 Total Poland Food sales increased by 5.4%, while in Small Format stores increase was of 6.5%

9,3% 0,9% 4,5% 2,0%

8,5%

• 0,8%

0,0% 6,5%

Discounters Hypermarkets 2500+ Supermarkets 300-2500 Small Format FY 2017 FY 2018 10,1% 0,8%

• 4,8%

5,0%

2,3% 12,2%

• 0,6%

13,5%

Small Supermarkets 100-300 Convenience 40-100 Small Grocers -40 Specialized & Others

FY 2017 FY 2018

4,2% 0,7%

• 3,5%

10,1% 2,6% 13,2% 5,9% 16,6%

Discounters Hypermarkets 2500+ Supermarkets 300- 2500 Small Format Small Supermarkets 100- 300 Convenience 40- 100 Small Grocers -40 Specialized & Others

2015 2016 2017 2018

Food market dynamics

Sales per one small format store is increasing the fastest despite declining number of all outlets

5

Source: Nielsen, Total Poland, All Food

Change of sales per one store Change of number of stores 158

• 5

114

• 3 087
• 31
• 244
• 2 197
• 615

Discounters Hypermarkets 2500+ Supermarkets 300- 2500 Small Format Small Supermarkets 100-300 Convenience 40-100 Small Grocers -40 Specialized & Others

4.0 91.5 0.3 3.3 8.9 33.2 27.0 22.3

• No. of

stores (k)

6,4% 4,5% 3,2% 2,0% 0,9% 2,8% 1,6%

• 2,8%

6,8% 4,3% 5,9% 2,0% 1,2% 2,1%

• 2,4%

abc Gama Lewiatan EKO (DC) Delikatesy Centrum Bierdronka Carrefour Tesco CEE

2018 4Q 2018

Biedronka

6,8% 5,4% 4,7% 3,9% 2,7% 1,7% 1,8% 2,0% 1,4% 1,3% 1,3%

• 0,1%
• 2,3%
• 4%
• 2%

0% 2% 4% 6% 8% 10% 12%

Fats Dairy Vegetables Bread and Cereals Food Meat Coffee & Tea Tobacco Fish Beverages Alcohol

• incl. Spirits,

Wine Beer Fruits Sugar, sweets, jams

2018 (I-IX) 2018 (I-XII)

Source: GUS

Large format categories Small format categories

Like for Like vs. inflation

Small Format stores sales growth accelerated despite lower inflation than other segments

6 Food average

Like for Like sales dynamics by chain

(YoY, 2018)

Food inflation by product category

Delikatesy Centrum inflation: wholesale prices -1.2%, retail prices +0.4% in 2018 YoY

Small Stores average +3.4% Large Stores average +0.5%

Source: Eurocash Group, Companies reports, wiadomościhandlowe.pl, abc – data for appx. 300 stores

Eurocash Group overview

Enormous purchasing power and efficient logistics to serve small and neighborhood stores across Poland

7

Eurocash Group Wholesale Retail Projects Others (HQ)

Delikatesy Centrum Cash&Carry Tobacco Specialized Distribution Alcohol Specialized Distribution Food Service (HoReCa)

Over 80k clients. 13.5k retail stores organized within soft franchise chains: abc, Lewiatan, Groszek, Eurosklep, Gama

Eurocash Distribution

Delikatesy Centrum: 1.5k stores - 500 own & 1000 hard franchise Inmedio: 500 newsagents

Sales* EBITDA* PLN 17.7 bn (+6%) PLN 410 m (+18%) PLN 4.9 bn** (+26%) PLN 112 m (-13%) PLN 74 m PLN -45 m N/A PLN -102 m

* Results for 2018 ** Consolidated sales. Total annualized sales including franchise retail sales amounted to 7.4bn. Retail already includes Fresh Project Inmedio Duży Ben Kontigo Others Faktoria Win (W) PayUp (W)

Already moved to Wholesale or Retail (W or R) due to reach of break even point:

Fresh Project (R)

Sales*: PLN 22.7bn (+10% YoY) EBITDA*: PLN 374m (+4% YoY)

recently sold for 14x EBITDA

1 2 2 3 4 5 6 7 9 15 15 15 18 16 17 18 1 1 1 1 1 2 2 2 3 4 5

1 2 2 3 5 6 7 8 10 17 17 17 20 19 21 23

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015* 2016 2017 2018 Wholesale Retail

Eurocash - 2nd largest overall player in an unique market

8  16 acquisitions aimed at rolling up strong category leaders , capturing synergies around a common back-office  Hypermarkets have shown little growth for last 10 years

3 9 3 6 10 5 9 5 7 17 3 1,7 7 4 5 9 11 8 10 11 19 32

3 5 7 7 7 10 10 10 11 16 23 48

Selgros Dino Metro (Makro C&C) Żabka Intermarche Carrefour Auchan Kaufland Tesco Lidl Eurocash (Pro-Forma) Biedronka

2017 2013 2009 Eurocash Group sales evolution (PLN bn) Ranking of FMCG distributors & retailers (sales, PLN bn)

Source: RZ500

*IFRS 15 accounting change (appx. 2.4bn PLN) *IFRS 15 – change of accounting rules, impacting sales revenues and costs of goods sold by EUR 2.4 bn due to reclassification part of sales into lower purchase conditions. No impact on EBITDA.

MBO IPO Delikatesy Centrum KDWT PayUp McLane Batna Premium Distributors Tradis Group Inmedio Kolporter FMCG Frisco.pl Rogala FHC-2 PDA EKO Mila M&A history: MHC PayUp Disposal

Top players are not names one would expect to outrank famous international retail chains

Wholesale: No. 1 distributor in Poland

9

Building scale and purchasing power to bring competitiveness to small stores

Wholesale market share

Eurocash Group 27%

Makro - FMCG (C&C) 6% Selgros (C&C) 4% PT Dystrybucja (T) 4% Distribev (A) 3%

Bać-Pol 2%

Alti (A) 1%

PHUP Gniezno (T) 1%

Others 51%

• Local sub-wholesalers
• Producers own distribution
• Specialized & categories not

covered by Eurocash

Dedicated distribution platforms covering different store profiles

25% 26% 13% 33% 3%

4,5 4,6 2,2 5,9 0,5

Sales (PLN bn)

Cash&Carry Eurocash Distribution Alcohol Distribution Tobacco & Impulse Distribution HoReCa

Delivery Generalists Specialized

T- Tobacco; A-Alcohol,

8,0 8,7

2017 2018 LT Objective

80

10 # of Eurocash.pl users (thsd.)

1 173 934 623

www Sales Rep. Others

2018 avg. order by type (pln)

33 16 14

www Sales Rep. Others

2018 # of ordered SKU

+26% +88% +108% +141%

Digital approach to increase store owners competitiveness

 To customize offer to local consumers  To flexibly compete with centrally managed retail chains  To reduce store costs, making work much easier and more automated  To fully integrate supply chain from Eurocash to Consumer

Eurocash.pl - successfully developed in 2018

Tremendous change in everyday life of store owner

Retail: 1st nationwide proximity supermarket chain in Poland

11

Entering retail through market consolidation, followed by operational integration, with LT objective to become no. 3 retailer in Poland

Ranking of retailers (2017 sales, PLN bn)

4,3 3,1

1 539 stores

1002

Number Of Stores Retail Sales (PLN bn)

7.4 bn PLN

Own Franchise

537

+5 bn PLN

> Retail Sales

+900 stores

> By 2023 Acquisitions Green Field Franchise Chain 2-3Y integration to ensure standardized business with unified processes

2 2 3 3 3 5 7 7 7 10 10 10 11 16 48 Piotr i Paweł Polomarket Stokrotka E.Leclerc Netto Dino Intermarche Żabka Delikatesy Centrum Carrefour Kaufland Auchan Tesco Lidl Biedronka

LT

• bjective

EV/Sales 48% (JMT) 39% (TSCO) 22% (CA) ? 62% (PE) 114% (DIN, IPO) 49% (PE) 57%

Profi (Romania)

68% (PE) Average

consolidated 5.1

*PE- Private Equity deal

20,1 18,9

2016 2018

1 086 1 539

2016 2018

4,6 7,4

2016 2018

237 399

2016 2018

Eurocash Retail: consistently investing in the future

12

 Expansion already started through consolidation of two chains, both having potential to increase sales density

Selling area (k sqm) Brand sales revenues (PLN bn)

• No. of stores

Sales per sqm (k PLN) +68% +61% +42%

 Strong asset base increase  Asset integration &

• perational standardization

 Expansion & sales development through new stores and additional acquisitions  Rebranded EKO stores are still at early stage but already started to show strong LFL* improvement

*LFL – Like-for-Like sales growth, or same store growth

Acquisition of distressed regional chains boosts sales and store count but initially sales per sq.meter take a hit

Retail – biggest supermarket chain in Poland

Merger of 3 businesses under professional process management

13

EKO stores remodeling EKO logistics integration Head Office & Operational integration

Together work as market leader December 2017 June 2019 September 2019 Further realization of strategic goals and process development From October 2019

Key milestones for integration process

Finished integration project

Strategy review

1

Expansion HQ, HR & Internal communication IT Business Case, Synergies & KPIs CRM & Marketing Risk Management Finance & Accounting Logistics / Supply chain Legal Assortment Review & CVP Stores Operations Central Commercial Processes

3 2 4 5 6 8 9 10 11 12 7 13

December 2018

Mila stores remodeling

FRISCO.PL

Warsaw market leader, home delivery with 41% market share E-supermarket B2C Fully automated warehouse

Projects serve to incubate forward-looking retail concepts and solutions

14

FRESH PRODUCE

Break even point already achieved in 2018 after 3.5 years from launch with cumulative lo sses at 5% of sales Delivery every day before 11am Crucial for retail development

FAKTORIA WIN

Reinvented wine category in small stores Wine market share up in Small Format stores from 29,6% (2013) to 34,7% (2017)

DUŻY BEN

Specialized liquor store Supported by Eurocash scale High cash generation Deconsolidated market Already 24 stores, with store level avg. BEP after 9 months

 Digitalization  Automation  Personalization  Professionalization  Each start-up was unprofitable in initial phase, but nowadays gives competitive advantage and are starting to generate profits  Cumulative EBITDA investment of EUR 40 m in last 4 years to address recent consumers’ behavior changes:

In a changing industry, Eurocash is able to keep investing in good times and bad to innovate in support of small stores

• 11,6
• 11,7
• 12,4
• 5,8
• 11,1
• 17,2
• 13,2
• 19,4
• 17,3
• 25,6
• 27,6

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

0,2 0,4 0,7 0,9 1,6 2,1 2,4 3,4 3,7 4,2 4,7

0,2 0,3 0,7 1,8 1,9 2,0 2,3 2,4 2,7 3,0 3,4

158% 101% 93% 100% 137% 135% 60% 206% 74% 137% 133%

2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018** LTM

• Cum. OCF
• Cum. ICF

OCF/EBITDA

15

Cumulative Operational Cash Flow (OCF) and Investment Cash Flow (ICF) PLN bn Cash Conversion (in days)

 Cash conversion one of best in market and compared with international comparables  Cash generative business model funds M&A and innovation for long-term  We kept investing even in tough macro environments: Total investment in last 10 years of EUR 800m

Eurocash Group: high cash generation is the key enabler of success

IFRS 15 accounting change (-2 days)* *IFRS 15 impact on working capital rotation due to 2.4bn PLN sales reclassification

Now, as before, a capex-light business model and working capital discipline underpin M&A and investments

Changing consumer habits are opportunity for small stores in Poland

16

Proximity and small stores will get even more importance having access to Eurocash innovations

Q:In which store do you most often perform given types of shopping missions? .

55% 58% 38% 23% 61% 44% 55% 12% Hypermarkets Supermarkets Discounters Small Stores Special Occasion Stocking Up 4% 7% 24% 51% 15% 36% 65% 73% Hypermarkets Supermarkets Discounters Small Stores Unexpected need Daily routine shopping

Big Shopping Small Shopping  Thanks to digitalization, automation and e-commerce growth

SMALL STORES MAY TAKE OVER BIG SHOPPING FROM LARGE CHAINS

e- and m-commerce as standard Growing disposable income Food: eco, organic, veg, regional, exotic Growing consumption of F&V, ready meals; less bread, meat, sugar Growing share

• f pensioners

Consumer change from passive to active

Eurocash Group – executive summary

17

• NO. 1. WHOLESALE DISTRIBUTOR IN POLAND

with 27% market share & the biggest (PLN 3bn) FMCG ecommerce platform DYNAMICALLY ENTERING INTO RETAIL already no. 7 with objective to become no. 3 retail chain in Poland WITH INNOVATION AND BUSINESS DEVELOPMENT PROJECTS DELIVERING RESULTS addressing digitalization, personalization & automation needs AS THE DOMINANT SMALL FORMAT & PROXIMITY STORE OPERATOR supported by globally changing trends & consumer habits

18

APPENDIX 1 2018 RESULTS

19

Executive Summary

FY WHOLESALE SALES INCREASE BY APPX. 1.0bn , RETAIL BY APPX. PLN 0.9bn

01 SMALL STORES WITH HIGH SALES INCREASE

with sales dynamics at +6.5% in 2018 YoY

WHOLESALE

STRONG GROWTH OF 6%IN 2018 with EBITDA PLN +63m (+18%)

RETAIL

INTEGRATION ONGOING, BUT LFL STARTED TO IMPROVE with Delikatesy Centrum +2% in 4Q 2018

02 04

NET DEBT/EBITDA DECREASE FROM 1.7x IN Q3 TO 0.9x IN Q4 due to PayUp disposal and strong OCF

03 05

STRONG CASH GENERATION With OCF at 1.4x EBITDA

20

2018 Eurocash financial summary

Sales increase by 10%, reported EBITDA by 70% (PLN +172m ), normalized EBITDA by 4% (PLN +13m)

PLN m

2017 2018 % of Sales 2017 % of Sales 2018 Y/Y Change Net sales 20 713 22 833 10% Gross profit 2 465 2 882 11,8% 12,6% 17% EBITDA 246 419 1,2% 1,8% 70% One offs:

• 114

45

Pay Up 75 Restructuring provision

• 27

Mila M&A fees (2Q18)

• 3

EBITDA normalized 361 374 1,7% 1,6% 4%

+410 +107

• 41
• 57

(-102*)

+63

• 46

+11 +45

(-15*) Wholesale Retail Projects Others SEGMENT EBITDA

(2018,PLN m)

CHANGE

(YoY PLN, m)

*normalized

 Gross profitability increased by 80bps driven by consolidation of Mila. Excluding Mila increase was of 22 bps  Normalized EBITDA increased by 4% in 2018 driven mainly by wholesale and off-set by retail  2018 cost optimization program (PLN +72m in 2018) was off-set by remuneration increase

16 217 16 726 17 682

2016 2017 2018

405 347 410

2,50% 2,07% 2,32%

2016 2017 2018

+5.7%

Wholesale Segment – strong growth in 2018

FY 2018: +956m sales and +63m EBITDA increase

21

+956m +508m +3.1% +63m +18.2%

• 58m
• 14.4%

 Strong performance in FY 2018 with sales +5.7%, EBITDA +18.2% and EBIT +27.1% YoY.  Cost pressure covered by improved efficiency.

FY 2018 Sales of goods evolution

(PLN m)

FY 2018 EBITDA evolution

(PLN m)

16 725 16 725 16 887 17 192 17 192 17 630 17 673 17 682

162 358 53 438 43 9

Wholesale 2017 Cash&Carry Tobacco Alcohol Distribution Food Service Other Wholesale 2018

1,3% 2,6% 0,7%

• 4,9%

0,0%

• 2,7%
• 2,2%
• 3,5% -4,0%
• 1,3%
• 3,6%
• 5,2%
• 4,6%

0,3% 0,3%

• 0,4%

1,5% 2,7% 3,8% 6,9%

Wholesale sales dynamics

Wholesale segment supported by professionalization of small format stores

22

+957 +5.7%

Wholesale sales evolution by format

(2018 YoY)

C&C LFL  Wholesale sustained the growth, with 5.7% in FY 2018 and 5.4% in Q4 2018  C&C LFL in FY 2018 showed best performance since 1Q 2013, with +4.1% and +6.9% in Q4 2018.  ECD sales to franchisees (Lewiatan, PSD, Euro Sklep, Groszek) increased by 10.1% in 2018 YoY

151 153 107

6,32% 4,46% 2,48% 2016 2017 2018

2 397 3 436 4 319

2016 2017 2018

Retail – increased asset base

Ongoing integration affecting short-term retail results

23

+883m +25.7% +1 039m +43.4%

• 46m
• 30.2%

+2m +1.2%

 Sales increase driven by M&A. Consolidated 2018 Mila sales 835 m PLN (369m in Q4 2018)  Delikatesy Centrum LFL in 2018 +2.9% wholesale and +0.9% retail. In Q4 2018: +3.4% wholesale and +2.0% retail  EBITDA impacted by ongoing integration of 3 separate businesses. FY 2018 Sales of goods evolution

(PLN m)

FY 2018 EBITDA evolution

(PLN m)

• 40
• 52
• 41

2016 2017 2018

271 551 680

2016 2017 2018

Projects – investments in the future growth

PLN 11m result improvement due to Fresh project break even point in 3Q 2018.

24

+129 +280 +11

• 12

FY 2018 Sales of goods evolution

(PLN m)

FY 2018 EBITDA evolution

(PLN m)

Projects – R&D on behalf of independent retailers: Faktoria Win PayUp Fresh Project 1minute Duży Ben Kontigo Others

Successfully developed Suspended Under expansion and further development

25

2018 financial summary - profitability

Normalized net profit impacted by increase of depreciation and net financial costs due to increased leverage

 Depreciation increase by PLN 21m, driven by Retail segment (Mila+EKO: PLN 16m)  Net Financial costs increase by PLN 16 m due to increased leverage and lower one-off financial revenues  Reported Net Profit increase by PLN 141m

PLN m (normalized)

2017 2018 %

• f Sales

2017 %

• f Sales

2018 Y/Y Change EBITDA 360,7 373,6 1,7% 1,6% 4% EBIT 177,4 169,6 0,9% 0,7%

• 4%

Net Financial Costs

• 42,7
• 58,8
• 0,2%
• 0,3%

38% Profit before tax 134,7 110,6 0,6% 0,5%

• 18%

CIT

• 49,9
• 43,9
• 12%

Net profit 84,8 66,9 0,4% 0,3%

• 21%

Net profit reported

• 29,6

111,7

• 0,1%

0,5%

26

 Cash from NWC driven by receivables due to: Tobacco receivables decrease, non-recourse factoring and credit limits management  Consolidation of Mila changing rotation of each WC component

Cash Flow

LTM Operating CF at 133% EBITDA (normalized)

Cash conversion cycle

(after IFRS 15)

PLN m

2017

2018 Net operating cash flow

471

499

Net profit (loss) before tax

20

156

Depreciation

183

204

Change in working capital

247

175

Other

21

(37) Net investment cash flow

(336)

(379) Net financial cash flow

(95)

(126) Total cash flow

41

(6) 31 31 28 30 30 27 24 21 25 23 21 23 24 24 20 20 (21) (21) (22) (27) (23) (25) (24) (28) (76) (75) (71) (80) (77) (76) (68) (70)

• 100
• 80
• 60
• 40
• 20

20 40

Q1 2017 Q2 Q3 Q4 Q1 2018 Q2 Q3 Q4

Receivables Stock Cash conversion Liabilities

27

*NET DEBT - the sum of long and short term loans, borrowings and financial liabilities less cash and cash equivalents

 Q4 2018 Net Debt decreased by PLN 226m

Net debt vs. LTM EBITDA

Healthy and declining leverage thanks to strong cash generation

Net Debt vs. EBITDA in 2018

431 441 419 361 363 360 363 419 584 486 464 370 468 685 608 382 1,36 1,10 1,11 1,02 1,29 1,90 1,67 0,91

1Q'17 2Q 3Q 4Q 1Q'18 2Q 3Q 4Q LTM EBITDA (PLN m) NET DEBT (PLN m) NET DEBT / EBITDA

28

(1) IFRS16 EBITDA – estimation for 2019 based on the assumption that the number of contracts will be constant and no change of their conditions is to occur. The estimated IFRS16

EBITDA shall not constitute any definitive forecasts and as such is not guaranteed by Eurocash to any extent .

(2) NET DEBT - the sum of long and short term loans, borrowings and financial liabilities less cash and cash equivalents (3) IFRS16 INDEX – new measure of indebtedness including operating leasing. The estimation shall not constitute any definitive forecasts and as such is not guaranteed by Eurocash to

any extent.

 CAPEX-light business model will drive IFSR16 Index / EBITDA (1) to 2.9x, EBITDA (1) to PLN 748m and EBITDA (1) margin to 3,3%

IFRS 16

Net Debt vs. EBITDA in 2018 (PLN m)

AFTER IFRS 16 IFRS 16 IMPACT CURRENT

2 184 (3) 1 802 382 (2)

NET DEBT / IFRS16 INDEX

748(1) 330(1) 419

EBITDA

2,9(3) 0,9

NET DEBT (IFRS16 INDEX) / EBITDA

3,3% 1,8%

EBITDA margin

22 833 22 833

SALES

 E-learning: 12,4k students, 70 courses  Workshops: 6k students, 70 towns  Conference: 5k participants  Business Studies: 72 students  Certification  400 initiatives from 250 towns

submitted to the contest by store owners

 100 grants for initiatives to support local

society

 PLN 1.5 m in total  Each grant: PLN 10k, 50k and 100k

Key successful developments in 2018

Educational and social projects driving competitiveness of small stores in their neighborhoods

30

2018 Summary

PROJECTS RETAIL WHOLESALE SALES EBITDA CASH FLOW IN PROGRESS IN PROGRESS

Disclaimer

31

This presentation and the associated slides and discussion contain forward-looking statements. These statements are naturally subject to uncertainty and changes in circumstances. Those forward-looking statements may include, but are not limited to, those regarding capital employed, capital expenditure, cash flows, costs, savings, debt, demand, depreciation, disposals, dividends, earnings, efficiency, gearing, growth, improvements, investments, margins, performance, prices, production, productivity, profits, reserves, returns, sales, share buy backs, special and exceptional items, strategy, synergies, tax rates, trends, value, volumes, and the effects of Eurocash S.A. merger and acquisition activities. These forward-looking statements are subject to risks, uncertainties and other factors, which could cause actual results to differ materially from those expressed or implied by these forward-looking statements. These risks, uncertainties and other factors include, but are not limited to developments in government regulations, foreign exchange rates, oil and gas prices, political stability, economic growth and the completion of ongoing transactions. Many of these factors are beyond the Company's ability to control or predict. Given these and other uncertainties, you are cautioned not to place undue reliance on any of the forward looking statements contained herein or otherwise. The Company does not undertake any obligation to release publicly any revisions to these forward-looking statements (which speak only as of the date hereof) to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events, except as maybe required under applicable securities laws. Statements and data contained in this presentation and the associated slides and discussions, which relate to the performance of Eurocash S.A. in this and future years, represent plans, targets or projections.

For more information please contact:

Cezary Giza

Investor Relations Director cezary.giza@eurocash.pl mobile: +48 693 930 415