CREATING TWO INDEPENDENT INTERNATIONAL LEADERS 30 March 2016
To the extent that statements in this presentation do not relate to historical or current facts, they constitute forwardlooking statements. All forward-looking statements herein are based on certain expectations and assumptions at the time of publication of this presentation and are subject to risks and uncertainties that could cause actual results, performance or financial position to differ materially from any future results, performance or financial position expressed or implied in this presentation. Many of these risks and uncertainties relate to factors that are beyond METRO GROUP s ability to control or estimate precisely. The risks and uncertainties to which these forward-looking statements may be subject include (without limitation) future market and economic conditions, the behaviour of other market participants, invest in innovative sales formats, expand in online and multichannel sales activities, integrate acquired businesses and achieve anticipated cost savings and productivity gains, and the actions of government regulators. Readers are cautioned not to place reliance on these forward-looking statements. See also Risk and Opportunity Report on pages 121-138 of the METRO GROUP Annual Report 2014/15 for risks as of the date of such Annual Report. METRO GROUP does not undertake any obligation to publicly update any forwardlooking statements or to conform them to events or circumstances after the date of this presentation. This presentation is intended for information only. It is not intended as an offer for sale, or as a solicitation of an offer to purchase, any securities in any jurisdiction. This presentation may not be reproduced, distributed or published without prior written consent of METRO AG. 30 March 2016 METRO AG 2016 1
SUMMARY OVERVIEW METRO GROUP prepares demerger into two independent, strong sector leaders Spin-off of Wholesale and Food Specialist group 1 from current METRO AG, which would subsequently fully focus on the consumer electronics sector Logical next step in transformation of METRO GROUP towards more customer centricity, stronger focus and greater entrepreneurship Both companies to benefit from accelerated growth and strategy implementation, simplified structures and improved time-to-market Initial analysis confirmed significant value creation potential and attractiveness for all stakeholders Completion of the transaction requires board and AGM approvals; completion is aimed for until mid-2017 1 METRO Cash & Carry, Real and other related businesses and services companies 30 March 2016 METRO AG 2016 2
STRATEGIC TRANSFORMATION OF METRO GROUP 30 March 2016 METRO AG 2016 3
A 5 YEAR TRANSFORMATION Real momentum in core business. ACQUISITIONS START-UP INV. / ACCELERATORS BUSINESS INNOVATION STRATEGY MODERNISATION OF OUR BUSINESS MODEL FOCUSING PORTFOLIO OPTIMISATION DELEVERAGING SUSTAINABILITY CORPORATE CULTURE, LEADERSHIP CULTURE, EMPLOYEE ENGAGEMENT CUSTOMER-FOCUSED STRATEGY 2012 2013 2014 2012 2013 2014 2015 2015 2016 Focused organisation Modernised business models Customer-centric Optimised portfolio Strengthened balance sheet.with substantial potential but further transformational needs 30 March 2016 METRO AG 2016 4
INGREDIENTS REQUIRED FOR FUTURE SUCCESS FOCUS ENTREPRENEURSHIP FLEXIBILITY AND AGILITY SPEED GROWTH 30 March 2016 METRO AG 2016 5
THE LOGICAL NEXT STEP IN THE TRANSFORMATION OF METRO GROUP: THE CREATION OF TWO DISTINCT, PURE-PLAY SECTOR LEADERS Independent, dedicated management teams and governance Improved focus, flexibility, operational efficiency and transparency Greater optionality for each company to pursue independent partnerships and M&A Creating value for our shareholders, customers, employees and business partners 30 March 2016 METRO AG 2016 6
AN INTERNATIONAL WHOLESALE & FOOD SPECIALIST GROUP Genuine international leader with very strong brands Champion for independent business" Fundamental transformation well underway Accelerating presence in Foodservice Distribution 10 consecutive quarters LfL sales growth 30 March 2016 METRO AG 2016 7
AN INTERNATIONAL WHOLESALE & FOOD SPECIALIST GROUP Leading full-service wholesale & food specialist partner-of-choice Select Wholesale & Foodservice players 1 Strong B2B brands and leading own-brand solutions From transaction-driven to customer-centric solutions provider - the Champion for independent business De-centralized culture with high entrepreneurship Consistent strong performance in Food Service Distribution Proven buy-and-build strategy (Classic Fine Foods & Rungis) Further enhance leading position Strengthen market positions in core countries Continue optimisation and expansion of geographic portfolio Significant consolidation opportunities Digitalization shaping METRO into a premier provider of solutions Sysco Metro US Foods PFG Bidvest Booker Eurocash Brakes Sligro Marr 2014/15 Delivery sales 2013/14 2.8 bn 3.1 bn Real is the preeminent full assortment offer in German food retail Unique product range combined with modernized format and service approach in order to satisfy growing demand for better quality 2020 1 Sales in ; Financials calendarised to Sep-2015 yearend (FactSet) 30 March 2016 METRO AG 2016 8
#1 EUROPEAN CONSUMER ELECTRONICS PLATFORM Leading consumer electronics brands and formats Distribution partner-of-choice Ongoing transformation into a fully integrated multi-channel proposition 6 consecutive quarters LfL sales growth with fast online growth Full control through effective governance 30 March 2016 METRO AG 2016 9
#1 EUROPEAN CONSUMER ELECTRONICS PLATFORM Unique platform delivering growth in market share and accelerated earnings through focus on operational excellence Strong asset base: 1,000+ stores, 5 million customer contacts per day Preeminent consumer brands: Media Markt, SATURN, Redcoon Extensive product portfolio and comprehensive service offering Leverage position as leading European consumer electronics retailer Transformation into fully integrated multi-channel proposition Drive customer loyalty: capitalize on strong brands, routes to market and innovation / service Partnerships with suppliers: distribution power & exclusive products New business opportunities: portfolio optimization, partnerships, M&A Select Consumer Electronics players 1 Best Buy Media-Saturn Suning Dixons Carphone FNAC Darty MVideo Teknosa 2014/15 2020 E-commerce sales 2013/14 1.4 billion 1.8 billion 1 Sales in ; financials calendarised to Sep-2015 year-end (FactSet) 30 March 2016 METRO AG 2016 10
PROPOSED TRANSACTION STRUCTURE: METRO GROUP TO SPIN OFF ITS WHOLESALE & FOOD SPECIALIST BUSINESS Shareholders WS & FS Co¹ Shareholders CE Co¹ 1. METRO GROUP to spin off WS & FS Co comprising of METRO, Makro, Real and their associated entities and real estate properties to its shareholders 2. The transaction will create two independent listed entities 3. METRO GROUP shareholders will receive shares in both entities 4. Major pre-conditions for transaction achieved over the recent past 5. Thorough initial feasibility review completed 6. Detailed preparatory works to start immediately 1 For the purposes of this document; businesses to be appropriately named in due course 30 March 2016 METRO AG 2016 11
FINANCIAL PRE-CONDITIONS AND IMPLICATIONS CONDITIONS FOR A NEW CORPORATE STRUCTURE HAVE BEEN SET / STRONG GRASP OF TRANSACTIONAL IMPLICATIONS LFL GROWTH STREAMLINED PORTFOLIO STRONG DELEVERAGING Competitiveness in our core operations has been strengthened sustainably Establishment of healthy, sustainable country portfolio Disposal of Kaufhof and others Increasingly focused operations Significantly enhanced financial capacity over the past years Balance sheet strengthened by deleveraging of over EUR 5bn ADDITIONAL CONSIDERATIONS Thorough initial assessment and analyses have substantiated the high attractiveness and our ability to deliver the transaction As of today very limited overlaps or synergies between MCC and Media-Saturn Considerations regarding financing and tax structuring have commenced; no major obstacles envisaged Both entities most likely eligible for MDAX inclusion The proposed transaction is deliverable and very attractive for all stakeholders 30 March 2016 METRO AG 2016 12
KEY BENEFITS OF THE SPIN-OFF LOGICAL NEXT STEP IN THE TRANSFORMATION OF METRO AND IN UNLOCKING ADDITIONAL SHAREHOLDER VALUE 1 Greater management focus and operational flexibility to drive performance 2 Acceleration of transformation and innovation continues to grow appeal and relevance for customers 3 Reducing complexity and providing direct access to capital resources 4 Tailored capital structures befitting their respective strategies 5 Ability to pursue own acquisition and partnership strategies 6 Distinct, focused investment theses and greater visibility to investors to drive shareholder value Creating two high-performing independent businesses in attractive sectors 30 March 2016 METRO AG 2016 13
NEXT STEPS Where we are today Indicative review of all potential implications has returned favorable results in all aspects Analysis to date suggests that the proposed transaction would be in the best interests of all shareholders Further detailed analysis and preparation of transaction pre-requisites What is next? Management board, supervisory board and general shareholder meeting s approvals Implementation of spin-off / separate listings aimed to be completed by mid-2017 Update on progress at Q2 reporting 30 March 2016 METRO AG 2016 14
Q&A 30 March 2016 METRO AG 2016 15
CREATING TWO INDEPENDENT INTERNATIONAL LEADERS 30 March 2016