European Retail Briefings - July 2007

HIGHLIGHTS: JULY 2007
Grocers
Multi-sector retailing
Department stores
DIY retailing
Furniture retailing
NEWS ANALYSIS
 BAKERS (RETAIL)
UK: Thorntons FY LFLs edge ahead
 GROCERS
Belgium: Colruyt FY sales, profits up
France: Carrefour
…to withdraw from Portugal
…as Q2 LFLs rise 5.9%
…despite being fined €2m for false advertising
…as Halley family consider stake sale
…while it looks at global expansion
Hungary: Tesco expands
Netherlands: Laurus H1 LFLs up 4.3%
Russian Federation: Carousel LFLs up 13.8%
Russian Federation: Magnit H1 LFLs surge ahead
Russian Federation: X5
…raises $1 bn loan, appoints Ukraine CEO
…as Q2 LFLs surge ahead
Spain: Tengelmann’s 250 Supermercardos stores go to Carrefour
Sweden: Axfood H1 LFLs edge ahead
Sweden: ICA H1 LFLs up 4.3%
UK: Asda
…to put George online
UK: Kwik Save enters administration
UK: Morrisons
…set to sell 25 shopping centres
…confirms Gibson as chairman
…remains ‘on track’
UK: Sainsbury’s
…still circled by bid rumours
…as Tchenguiz doubles stake
…before Delta makes approach
…and details go public
…with Lord Sainsbury set to oppose takeover
UK: Tesco
…moves into housing market
…then loses key estate agency partner
…and is threatened with lawsuit
…before refocusing marketing on price war
UK: Waitrose gears up expansion plans
United States: Kroger LFLs continue to grow in Q1
United States: Safeway Q2 sales driven by Lifestyle stores
United States: Tesco focuses operations around 'customer assistants'
United States: Whole Foods
…extends Wild Oats offer again
…before it emerges that CEO trashed rival on web
…which leads to a storm brewing for Mackey
 MASS MERCHANDISERS
UK: Costco FY sales up, profits down
 MIXED GOODS RETAILING
UK: Instore LFLs sales up 4.1%
UK: McCarthy guides Poundland to improved year
UK: Wilkinson FY profits leap ahead
 MULTI-SECTOR RETAILING
Australia: Coles
…sees Blackstone back out of bid
…as Wesfarmers sweetens deal
…before it reveals future plan
China: Wal-Mart aims to double Chinese stores within 5 years
Finland: Kesko H1 sales up 9.7%
Germany: KarstadtQuelle in talks with Debenhams
Spain: El Corte Inglés to resist calls for IPO
UK: Boots
…buyout gets S&P warning
…as CEO quits
UK: HMV
…rebounds after FY profit slump
…and eyes Fopp brand
UK: M&S
…sees Q1 LFLs edge ahead
…as Per Una founder gets set to quit?
United States: Sears issues further profit warning
United States: Target
…sees Ackman take stake
…then ups influence
United States: Wal-Mart
…looks to appeal to emotions
…and cuts prices on 16,000 products
 DEPARTMENT STORES
Germany: Debenhams set to exit Germany
Iceland: Baugur has no plans to make offer for Debenhams
United States: Saks sells 8% to Baugur
United States: Jones Apparel
…agrees to sell
…then gets higher bid
United States: Macy's
…cuts quarterly outlook
…looks set to go private
…as Harper named new President
United States: Nordstrom reportedly sells Façonnable chain
 DIY RETAILING
Germany: Globus buys rival Hela for €100m
Russia: Kingfisher announces push in Russia
United States: Home Depot cuts FY forecast
 ELECTRICAL RETAILING
France: Kesa
…considers selling BUT
…then confirms BUT offers
UK: DSG
...mulls franchises in UK
…as Dixons expands offer
United States: Best Buy to expand; buy back $5.5bn shares
 MUSIC AND VIDEO GOODS RETAILING
UK: Fopp flops
 CARPET RETAILING
UK: Carpetright FY LFLs slip
 FURNITURE RETAILING
France: Kesa
…considers selling BUT
…then confirms BUT offers
Sweden: Ikea to axe 300 managerial jobs
Sweden: ILVA lost £11.5m prior to UK launch
 HOMEWARES RETAILING
UK: Dunelm reports strong FY
 HOME SHOPPING
UK: Asos FY sales leap ahead
UK: N Brown LFLs up 11.1%
 HEALTH AND BEAUTY RETAILING
Germany: Strong H1 sales for Rossmann
UK: The Body Shop H1 LFLs up 7%
United States: Walgreens
…sees Q3 LFLs surge ahead
…and buys Option Care for $850m
 SPORTS AND LEISURE GOODS RETAILING
UK: Blacks
…rebounds
…with Freespirit sale to go ahead
UK: JJB suffers from World Cup comparatives
UK: Sports Direct
…buys Everlast
…buys majority stake in Field & Trek
…but warns on profit growth
 GARDEN CENTRES
UK: Dobbies
…battle continues
…as Tesco extends offer
 TOYS AND GAMES RETAILING
UK: Game Group H1 LFLs surge ahead
 CLOTHING RETAILING
China: Mothercare confirms China plans
Europe: Gap denies plans to quit Europe
International: Another investigation into 'slave labour' conditions
UK: Bhs not for sale, says Green
UK: Burberry Q1 sales up 24%
UK: Jaeger FY sales, profits leap ahead
UK: Mothercare makes solid start to the year
UK: New Look
…sees sale collapse
…then looks to global expansion
UK: Peacocks mulls sale
UK: SRG up for sale
United States: Liz Claiborne
…to cut 16 apparel brands
…and announces sweeping restructuring
 FOOTWEAR RETAILING
United States: Finish Line launches marketing blitz
United States: Payless purchases Dexter
 DOLLAR STORES
United States: 99 Cents Only
…reports mixed FY
…but does well in Q1
United States: Family Dollar sees successful third quarter
ECONOMIC NEWS
Australia: Retail sales up in May
Europe: Retail sales increase in May
Germany: May sees retail slump
Ireland: Retail sales surge in May
Japan: Retail sales edge ahead in May
UK:
Retail sales remain firm in June, says ONS
CBI: retail sales growth slows in June
Retail sales rebound in June, says BRC
MARKET ANALYSIS: PC RETAILING IN EUROPE
 THE EUROPEAN PC RETAILING RETAIL SECTOR
PC penetration – Creating the information society
Figure 1: PC Penetration by country, 2006
Germany the largest of the five markets
Figure 2: Share of consumer spending on information technology equipment, 2006
Figure 3: Per capita spending on information processing equipment, 2006
Spending on information processing equipment as % of total spending
Figure 4: Spending on information processing equipment as % of total consumer spending by country, 2006
Historical growth
Figure 5: Growth in consumer spending on information processing equipment by country, 2002-06
Figure 6: Spending on information technology by country, 2002-06
Forecast for consumer spending on information technology
Figure 7: Forecast spending on information processing equipment by country, 2006-11
Figure 8: Consumer spending on information technology & all retail sales forecast index, 2001-11
Retail sales
A lack of relevant data
Spending a better measure
Outlook and forecasts
Figure 9: Miscellaneous specialists’ sales by country, 2002-12
 RETAIL COMPETITOR ANALYSIS
Figure 10: Europe: Leading PC retailing companies, sales 2005 and 2006
Figure 11: Leading electricals retailing companies, PC sales, 2006
Market shares
Figure 12: Leading specialist retailers’ share of the PC market, 2006
Figure 13: Leading non-specialist retailers’ estimated share of the PC market, 2006
Figure 14: Leading retailers’ estimated share of the PC market, 2006
Recent developments
 TRENDS AND ISSUES
An unevenly developed market
Who doesn’t have one?
Not just one
Price
Replacement cycle
COMPANY PROFILE: CDC COMPUTER DISCOUNT
Background
Financial performance
Figure 15: CDC Computer Discount: Group financial performance, 2002-06
Store portfolio
Figure 16: CDC Computer Discount: Outlet data, 2002-06
Figure 17: CDC Computer Discount: Group operations, 2006
Retail offering
Market positioning
Brands
Product offer
Pricing
e-commerce & home shopping
Figure 18: CDC Computer Discount: Group websites, 2007