Brait Plc · JSE:BAT

Brait — Iceland Foods — Q3 FY2016 Earnings Presentation

18 slides from Brait's earnings presentation, Feb 4, 2016

1. Slide 1: Fiscal Year 2016 Interim Results for 40 Weeks Ended 1 January '16

   FISCAL YEAR 2016 INTERIM RESULTS FOR 40 WEEKS ENDED 1 JANUARY ‘16 4th Feb 16

2. Slide 2: Agenda

   Agenda  Key Highlights  Financial Review  Outlook  Full Year Results Presentation  Q&A Presenter: Tarsem Dhaliwal (CFO) First quarter:12 weeks ending 19 June 2015 Second quarter: 12 weeks ending 11 September 2015 Third quarter: 16 weeks ending 1 January 2016 Interim results: 40 weeks ending 1 J

3. Slide 3: Key Highlights

   Key Highlights Iceland

4. Slide 4: Key Highlights

   Key Highlights The Market • The UK Retail is still challenging. Based on the latest Kantar data (12 weeks ending 3 January ‘16), food deflation is at (1.8%) • Christmas trading results from competitors show improved performance Iceland • Turnover down (1.5%) year on year in the third quarter with ye

5. Slide 5: Third quarter results versus Second quarter outlook

   Third quarter results versus Second quarter outlook • Current trading: Like for like sales broadly in line with the FY16 quarter 2 performance • Net 6 new stores will open in FY16 quarter 3 (1 standard, 3 Food Warehouse and 2 Republic of Ireland stores) • Power of Frozen and Innovation will continue

6. Slide 6: Financial Review

   Financial Review Iceland

7. Slide 7: Third Quarter Sales Performance (£m)

   Third Quarter Sales Performance (£m) FY16 Q3 FY15 Q3 Var Var% Base Estate (LFL) 835.6 862.3 (26.7) (3.1%) FY15 & FY16 New 23.3 8.8 14.5 1.7% Stores Other Group Co’s 5.0 5.6 (0.6) (0.1%) Turnover 863.9 876.7 (12.8) (1.5%) 7

8. Slide 8: Year to Date Sales Performance (£m)

   Year to Date Sales Performance (£m) FY16 FY15 Var Var% Base Estate (LFL) 1,988.9 2,044.7 (55.8) (2.7%) FY15 & FY16 New 60.7 21.5 39.2 1.9% Stores Other Group Co’s 12.5 12.4 0.1 0.0% Turnover 2,062.1 2,078.6 (16.5) (0.8%) 8

9. Slide 9: Third Quarter Profit and Loss (£m)

   Third Quarter Profit and Loss (£m) FY16 Q3 FY15 Q3 Var • Gross profit margin up 0.6% year on year (£3.9m in cash terms). This was primarily Group Turnover 863.9 876.7 (12.8) driven by an improvement in underlying gross margin Cost of Sales (800.9) (817.6) 16.7 • Admin Expenses (£1.1m) adverse year o

10. Slide 10: Year to Date Profit and Loss (£m)

    Year to Date Profit and Loss (£m) FY16 FY15 Var • Gross profit margin up 0.4% year on year (£7.7m in cash terms). This was primarily driven by the Group Turnover 2,062.1 2,078.6 (16.5) improvement in underlying gross margin and cost efficiencies, partially offset by marketing spend Cost of Sales (1,

11. Slide 11: Third Quarter Cash Flow (£m)

    Third Quarter Cash Flow (£m) FY16 Q3 FY15 Q3 Var • Third quarter movement in working capital of Group EBITDA 47.0 45.1 1.9 £9.0m, down (£1.9m) year on year Movement in Working • Year on year increase in capital expenditure in 9.0 10.9 (1.9) the quarter reflects underlying additional spend Capital Ne

12. Slide 12: Year to Date Cash Flow (£m)

    Year to Date Cash Flow (£m) • Year to date movement in working capital of FY16 FY15 Var £30.6m, down (£13.2m) year on year primarily driven by stock build relative to last year Group EBITDA 106.9 108.0 (1.1) • Year on year increase in net capital expenditure is driven by the commitment to projects s

13. Slide 13: Net Debt (£m)

    Net Debt (£m) FY16 Q3 FY16 Q2 Var Cash at Bank and in hand 180.5 156.8 23.7 Debt (896.5) (895.0) (1.3) Finance leases (7.3) (2.0) (5.6) Net Debt (723.3) (740.2) 16.5 Net Leverage 4.85x 5.03x 0.18x *Leverage calculations based on rolling 12 month EBITDA 13

14. Slide 14: FY16 Bond Buy Backs (Company and related parties)

    FY16 Bond Buy Backs (Company and related parties) • No Bond Buy Backs completed during FY16 Quarter 3 We and our affiliated entities, including Directors and Shareholders of Iceland Topco Limited and their affiliated entities and their employees and officers, and agents acting on our or their behalf

15. Slide 15: Outlook

    Outlook Iceland

16. Slide 16: Outlook

    Outlook • Current trading: Like for like sales improved on FY16 quarter 3 performance • Net 1 store will close in FY16 quarter 4 • Power of Frozen and Innovation will continue with more focus on Products and Price • Increased focus on seasonal \ event promotional activity • January : “More ways to e

17. Slide 17: Full Year Results Presentation

    Full Year Results Presentation • Hosted by: Malcolm Walker, CEO Tarsem Dhaliwal, CFO  To be held in London on 8th June 2016 Invites with relevant details will be sent out via investor website. 17

18. Slide 18: Q&A

    Q&A Iceland

Iceland Foods — Q3 FY2016 Earnings Presentation on 6ix