Axfood AB · OMXSTO:AXFO
Axfood AB — Q2 2006 Earnings Presentation
26 slides from Axfood AB's earnings presentation, June 2006
Slide 1: Axfood AB June Q2 2006
Axfood AB JUNE Q2 2006 AXFOOD AB June 2006 1
Slide 2: Axfood business overview
Axfood business overview Retail Wholesale operations Närlivs AXFOOD AB June 2006 2
Slide 3: Axfood
Axfood Consolidated sales 2005 totalled: 28,086 MSEK Operating profit for 2005 was 1,040 MSEK Average number of employees: 7,200 340 stores in Sweden, 235 is wholly owned Marketshare: 14% Market capitalization: 11,000 MSEK Listed on the på Stockholm Stock Exchange O-list, attract40 AXFOOD AB June 20
Slide 4: Strategy 2000 – 2005
Strategy 2000 – 2005 Axfood 2000 Strategy Axfood 2005 106 wholly owned stores Increase wholly owned stores 235 wholly owned stores Fragmented brand strategy Focus brand strategy Two core brands Local purchasing Centralize purchasing Central purchasing Private label 4% Increase private label Private
Slide 5: Willys – number of stores 1999-2006
Willys – number of stores 1999 -2006 120 100 80 60 40 20 0 1999 2000 2001 2002 2003 2004 2005 2006 AXFOOD AB June 2006 5
Slide 6: Hemköp – number of stores 2000-2006
Hemköp – number of stores 2000-2006 180 160 140 Franchise Wholly owned 120 100 80 60 40 20 0 2000 2001 2002 2003 2004 2005 2006 AXFOOD AB June 2006 6
Slide 7: Sales Axfood wholly owned stores
Sales Axfood wholly owned stores 20000 MSEK 15000 10000 5000 0 2000 2001 2002 2003 2004 2005 2006 Q2 AXFOOD AB June 2006 7
Slide 8: Private label, % of total sales
Private label, % of total sales 25 Private label, % of total sales 20 15 10 5 0 2000 2001 2002 2003 2004 2005 2006 AXFOOD AB June 2006 8
Slide 9: Operating profit and margin 2001-2006 Q2
Operating profit and margin 2001-2006 Q2 MSEK Operating margin % 1200 4 3,5 1000 3 800 2,5 600 2 1,5 400 1 200 0,5 0 0 2001 2002 2003 2004 2005 2006 Q2 AXFOOD AB June 2006 9
Slide 10: Dividend and share price 2001-2006
Dividend and share price 2001-2006 Dividend as % of profit Axfood share price 140 250 120 200 100 80 150 60 100 40 50 20 0 0 2001 2002 2003 2004 2005 2006 AXFOOD AB June 2006 10
Slide 11: Businesses 2005
Businesses 2005 Sales: 12,675 MSEK (11,789) Growth: 7.5% (LFL: - 0,6%) EBIT: 522 MSEK (530) EBIT margin: 4.1% (4.5%).Target: 4 - 4.4% Sales: 1,251 MSEK (1,284) Growth: -2.6% (LFL: - 9.8%) EBIT: -16 MSEK (-4) EBIT margin: neg (neg) Sales: 6,198 MSEK (6,167) Growth: + 0.5% (LFL: -4.5%) EBIT: 30 MSEK (
Slide 12: Businesses, 1 January–30 June 2006
Businesses, 1 January–30 June 2006 Sales: 6,867 MSEK (6,111) Growth: 12.4%, (LFL +1.7%) EBIT: 260 MSEK (250) EBIT margin: 3.8% (4.1). Target: 4 - 4.4% Sales: 609 MSEK (631) Growth: -3.5%, (LFL – 3.7%) EBIT: -5 MSEK (-7) EBIT margin: neg % (neg). Sales: 2,937 MSEK (3,063) Growth: -4.3%, (LFL +0.3%),
Slide 13: Net sales Axfood stores January - July 2006
Net sales Axfood stores January - July 2006 Discount 62% Supermarkets 38% ■Willys 8,019 MSEK ■Hemköp wholly owned 3,367 MSEK (+11.9%, LFL: +1.5%) (-4.9%, LFL: + 0.1%) ■Willys hemma ■Hemköp franchises 699 MSEK 1,935 MSEK (-4.4%, LFL: -4.0%) (+17.8%, LFL: + 5.1%) AXFOOD AB June 2006 13
Slide 14: Marketshare and segmentation Sweden
Marketshare and segmentation Sweden Market saturation Market Ica (Ahold) 36% Coop 16% Axfood 14% Bergendahls 5% Lidl & Netto 3% AXFOOD AB June 2006 14
Slide 15: Segmentation
Segmentation AXFOOD AB June 2006 15
Slide 16: Strategies 2008
Strategies 2008 Strong brands Develop Hemköps customer offering and operations Profitable growth Continued expansion for Willys Increase sales of private label Continued development of non-food product range Well-stocked stores through improved delivery reliability Improved IT support to stores Opti
Slide 17: Top of the agenda 2006
Top of the agenda 2006 Turnaround for Hemköp Organic growth Continued integration AXFOOD AB June 2006 17
Slide 18: Key ratios
Key ratios Apr.-Jun. Jan.-Jun. Jan.-Dec. SEK m 2006 2005 2006 2005 2005 *Net sales 7 378 7 040 14 198 13 691 28 086 *Operating profit 275 271 501 513 1 040 *Operating margin, % 3,7 3,8 3,5 3,7 3,7 *Profit after financial items 268 267 491 505 1 026 *Profit after tax 192 189 353 357 729 *Earnings per
Slide 19: Net sales per business unit
Net sales per business unit Apr.-June Jan.-June Jan.-Dec. SEK m 2006 2005 2006 2005 2005 Hemköp 1 465 1 544 2 937 3 063 6 198 Willys 3 585 3 140 6 867 6 111 12 675 Willys hemma 299 323 609 631 1 251 Axfood Närlivs1 1 192 1 219 2 202 2 251 4 680 Dagab2 5 288 4 906 10 089 9 331 19 487 Other3 235 207 4
Slide 20: Operating profit for the period (EBIT), broken down by business unit
Operating profit for the period (EBIT), broken down by business unit Apr.-June Jan.–June Jan.–Dec. SEK m 2006 2005 2006 2005 2005 Hemköp 11 -1 30 24 30 Willys 148 130 260 250 522 Willys hemma -3 -1 -5 -7 -16 Axfood Närlivs 35 32 45 44 103 Dagab 55 69 103 131 272 Other3 29 42 68 71 129 Operating prof
Slide 21: Condensed profit and loss account
Condensed profit and loss account Apr.-June Jan.-June Jan.-Dec. SEK m. 2006 2005 2006 2005 2005 Continuing operations Net sales 7 378 7 040 14 198 13 691 28 086 Cost of goods sold -6 351 -6 056 -12 236 -11 755 -24 172 Gross profit 1 027 984 1 962 1 936 3 914 Selling/administrative expenses, etc. -75
Slide 22: Condensed profit and loss account, cont
Condensed profit and loss account, cont Of which, majority owner's share 192 187 353 351 687 Of which, minority owner's share - 0 - -2 -5 Operating profit for continuing operations includes depreciation/amortization of 117 105 232 208 438 Earnings per share, SEK 3,62 3,44 6,57 6,54 12,59 Earnings pe
Slide 23: Condensed balance sheet
Condensed balance sheet SEK m 30/6/2006 30/6/2005 31/12/2005 Assets Goodwill 1 131 1 160 1 131 Interest-bearing receivables – 3 – Financial fixed assets 31 147 32 Other fixed assets 1 733 2 045 1 684 Total fixed assets 2 895 3 355 2 847 Inventories 1 469 1 664 1 598 Accounts receivable ― trade 525 7
Slide 24: Condensed balance sheet, cont
Condensed balance sheet, cont Shareholders' equity and liabilities Majority owner's share of shareholders' equity 1 988 2 488 2 825 Minority owner's share of shareholders' equity – 122 119 Total shareholders' equity 1 988 2 610 2 944 Interest-bearing long-term liabilities 384 517 383 Noninterest-bea
Slide 25: Condensed cash flow statement
Condensed cash flow statement Jan.-June Jan.-Dec. SEK m 2006 2005 2005 Operating activities –Cash flow from operating activities before changes in working capital before taxes payed 734 711 1 487 –Taxes payed1 -524 -163 -241 –Changes in working capital 115 -72 -76 Cash flow from changes in working c
Slide 26: Key ratios and other data
Key ratios and other data 30/6/2006 30/6/2005 31/12/2005 *Operating margin, % 3,5 3,7 3,7 *Margin after financial items, % 3,5 3,7 3,7 Equity ratio, % 33,3 36,5 38,9 Debt-equity ratio, net, multiple 0,3 0,1 0,01) Debt-equity ratio, multiple 0,40 0,23 0,22 Interest coverage, multiple 36,1 29,8 31,6 C