European Retail Briefing - December 2012

ANALYST COMMENT
 THE TROUBLE WITH ITALIAN RETAILING
Monti to go…
International retailers have gone
Figure 1: Europe: Top 300 European retailers by domicile, selected countries, 2011
Retail sector remains fragmented
Figure 2: Europe: Top ten national retailers’ revenues as % of all retail sales, selected countries, 2011
Figure 3: Europe: Percentage of all individuals having purchased goods or services online, selected countries, 2011
RETAIL SALES REVIEW
Key points
 FRANCE
Figure 4: France: Retail Sales, 2011-12
Inflation
Figure 5: France: Inflation, 2011-12
 GERMANY
Figure 6: Germany: Retail Sales trends, 2011-12
Inflation
Figure 7: Germany: Inflation, 2011-12
 ITALY
Figure 8: Italy: Retail sales trends, 2011-12
Inflation
Figure 9: Italy: Inflation, 2011-12
 NETHERLANDS
Figure 10: The Netherlands: Retail sales trends, 2011-12
Inflation
Figure 11: The Netherlands: Inflation, 2011-12
 SPAIN
Figure 12: Spain: Retail sales trends, 2011-12
Inflation
Figure 13: Spain: Inflation 2011-12
 UK
Figure 14: UK: Retail sales trends, 2011-12
Inflation
Figure 15: UK: Inflation, 2011-12
NEWS HEADLINES
Grocers
Clothing retailing
Footwear retailing
Multi-sector retailers
Department stores
DIY retailing
Electrical retailing
Home shopping
Music and video goods retailing
Sports and leisure goods retailing
NEWS ANALYSIS
 CONVENIENCE STORES
UK: Asda to enter convenience market with forecourt stores
UK: Waitrose under pressure over Shell deal
 CO-OPS
UK: Co-op
…sparks concern
…to acquire 10 Costcutter stores
…opens new distribution centre
 GROCERS
Belgium: Louis Delhaize exits Hungary
Europe: Metro to sell hypermarkets in Eastern Europe
France: Carrefour to sell 60% stake in Indonesian unit
France: Lidl moving French operational facility to Paris
Germany: Profits decline at Aldi Nord
Russian Federation: Kesko opens first food store in St. Petersburg
UK: Aldi
…records 27.3% sales growth, as Morrisons continues to struggle
…to open new format stores in London
UK: Asda
…mulls launch of digital entertainment service
…posts financial results
UK: Lidl
…doubles size of premium range
…to invest in Greece
UK: Morrisons
…and Asda call for extended Christmas opening hours
…introduces new discount card
UK: OFT - Supermarket loyalty cards under scrutiny
UK: Sainsbury’s
…and Asda expected to report sales growth
…appoints new group HR director
…opens energy efficient store
…to create 10,000 new local jobs
…posts profit rise
UK: Supermarkets sign up to offer and price promotion code
UK: Tesco
…launches online party food service
…launches online veg box offer
…Tesco Phone Shop launch pilot scheme to assist over-50 shoppers
…trials interactive touchscreens
…group strategy director departs
UK: Waitrose
…extends store opening hours for Christmas
…launches iPad version of weekly newspaper
…continues expansion programme
 OFF-LICENCES
UK: Bargain Booze appoints new CEO
UK: Majestic Wine reports 3.9% rise in pre-tax profits
 OTHER FOOD SPECIALISTS
UK: Holland & Barrett trials fitness drills
UK: Thorntons plans multichannel investment
 CLOTHING RETAILING
Europe: Prada group posts 50% rise in EBITDA
Italy: Dolce & Gabbana’s revenues remain stable
UK: Arcadia
…confirms sale of 25% stake in Topshop and Topman
…posts financial results
UK: Asos invests in second hand designer clothing website
UK: Aurora reports 15.3% drop in EBITDA
UK: Edinburgh Woollen Mill reports record profits
UK: Fast Retailing to purchase majority stake in J brand
UK: French Connection reports flat like-for-likes
UK: Gant appoints head of UK and Ireland brand operations
UK: H&M
…reports like-for-like sales decline
…to launch green initiative
…to open new store in Hammersmith
UK: Hobbs
…poaches buying and merchandising director
…posts rise in sales
UK: J Crew to open London Store
UK: Jacques Vert appoints new chief executive
UK: Jaeger reveals underlying loss of £8m
UK: Joules
…considers selling stake
…to sell Rampant Sporting
UK: M&Co returns to profitability
UK: Montique secures 63 doors as it prepares for UK debut
UK: Mulberry posts like-for-likes up 11%
UK: New Look
…appoints new CEO
…posts first half results
UK: Phase Eight to open first West End store
UK: Primark to open Warrington flagship
UK: SuperGroup
…appoints new non-exec directors
…to expand Superdry brand with wholesale accessories
UK: Ted Baker retail sales soar 24.6%
UK: TK Maxx potential buyer for Comet stores
UK: Topshop
…in talks to sell 25% stake
…to open Marble Arch store
UK: Zara
…opens new flagship store
…bans hazardous chemicals in supply chain and products
 FOOTWEAR RETAILING
UK: Aldo to double number of Call It Spring concessions
UK: Clarks launches Click and Collect service
UK: Dr Martens opens two new stores
UK: Dune looks to expand overseas wholesale
UK: Jones Bootmaker collaborates with House of Fraser
UK: Kurt Geiger focuses on international expansion
UK: Schuh
…reports 12% rise in like-for-likes in first three quarters
…reports pre-tax loss
UK: Stead & Simpson to close 90 stores
 MIXED GOODS RETAILING
UK: B&M Bargains
…moves to second round of bidding
…sold to US private equity firm
…brings American interest to UK value sector
UK: Poundland
…expands food offer
…partners with Mecca Bingo for promotional activity
…reports profit fall
 MULTI-SECTOR RETAILERS
Switzerland: Swiss Coop-owned Prodega in merger
UK: M&S
…appoints supply chain director
…to open at midnight on Christmas Eve
UK: Home Retail Group appoints new board member
 DEPARTMENT STORES
Bulgaria: Debenhams opens its first store in Bulgaria
Ireland: Dunnes Stores Faces Winding Up Petition
UK: Debenhams boss to receive extra £300,000
UK: Harrods appoints Sarah Brown as non-executive director
UK: House of Fraser reports rise in like-for-likes
UK: John Lewis
…clothes sales boosted by cold weather
…appoints customer insight director
…aims to open 60 stores by 2018
…partners with Red Letter Days
…reports 11.4% rise in sales
…reports record November sales
 DIY RETAILING
Germany: Hornbach issues profit warning
UK: Homebase to launch store refit programme
UK: Kingfisher
…B&Q trials banking scheme
…reports decline in Q3 profit
…to ramp up eco agenda
UK: Robert Dyas' chief executive steps down
UK: Topps Tiles posts profit rise
 ELECTRICAL RETAILING
Europe: Carphone Warehouse reports 5% rise in UK like-for-likes
UK: Comet
…axes home delivery service
…makes 330 staff redundant
…staff to lose jobs before Christmas
…stores potentially saved
…to close 41 stores
…website potentially saved
…future hangs in the balance
UK: Dixons
…rolls out Google Zones across Currys and PC World stores
…returns to black
UK: Game’s chief executive defends owner, OpCapita
UK: Maplin to open travel stores in 2013
 FURNITURE RETAILING
UK: Bathstore hires non-executive chairman
UK: BrightHouse reports strong growth in H1
UK: Dwell managing director steps down
 HOMEWARES RETAILING
UK: Cath Kidston reports profit rise
 HOME SHOPPING
Germany: Otto Group acquires Neckermann brand
UK: Amazon
…looks to steal high street sales with grocery offer
…reveals UK sales and profit figures
UK: Asos
…invests in second hand designer clothing website
…head of buying departs
UK: EBay to open social media pop-up shop
UK: Findel reports rise in H1 profits and sales
UK: Moonpig forces owner into the red
UK: My-Wardrobe appoints fashion director
UK: Net-A-Porter announces new print magazine
UK: Ocado
…sees shares soar
…introduces new service using Facebook
 HEALTH AND BEAUTY RETAILING
UK: Alliance Boots
…to extend maturity dates on loan facilities
…reveals plans for Nottingham site
UK: Feelunique.com acquired in £26 million private equity deal
 MUSIC AND VIDEO GOODS RETAILING
Europe: PPR’s Fnac to exit Italy
UK: HMV sells Mama Group
 BOOK AND STATIONERY RETAILING
UK: Clintons opens first distribution centre
UK: Waterstones seeks overseas expansion
UK: WH Smith posts interim results
 SPORTS AND LEISURE GOODS RETAILING
Europe: Le Coq Sportif to open European flagship in London
Switzerland: INTERSPORT continues expansion
UK: JD Sports
…launches JD Pro sports fascia
…reports like-for-likes rise 1.5%
UK: Rampant Sporting bought by Indian investor
UK: Reebok to open standalone stores
UK: Sports Direct owner eyes stake in House of Fraser
 JEWELLERS
UK: Claire's Accessories to debut ecommerce site in 2013
 NEWSAGENTS
UK: Martin McColl to expand convenience store portfolio
 TOYS AND GAMES RETAILING
UK: Hamleys sees pre-tax profits soar
 MISCELLANEOUS SPECIALISTS
UK: Countrywide secures extra funds
UK: Halfords
…reports 23.4% drop in profits
…to expand accessories range
UK: Hobbycraft appoints customer development director
UK: Mothercare cuts losses and improves sales trend
UK: Pets at Home to launch loyalty card
 SHOPPING CENTRES
UK: Lend Lease submits application for Bluewater expansion
 ECONOMY
UK: BRC
…food price inflation reaches nine month high
…like-for-likes edge up just 0.4% in November
…town centre vacancy rate reaches 11.3%
UK: ONS: UK retail sales fell 0.8% in October
UK: Visa predicts busiest shopping day of the year
SUPERMARKETS: MORE THAN JUST FOOD
 LIDL/KAUFLAND (SCHWARZ GROUP)
What we think
Can Lidl’s online non-foods offer be exported?
Figure 16: Schwarz Group: Lidl stores per million capita, 2011
Prospects in Germany: Lidl
Prospects for Kaufland
Scaling back hard-discount in France
Outpaced by Aldi in the UK
Background
Company performance
Figure 17: Schwarz Group: Group financial performance, 2007/8-2011/12
Figure 18: Schwarz Group: Outlet data, 2007/8-2011/12
Retail offering
Schwarz Group
Lidl
Kaufland