European Retail Briefing - March 2016

ANALYST COMMENTS
 STEINHOFF ON AN ACQUISITION SPREE
Logic
Argos
Darty
And Steinhoff?
 REAL – RUMOURS OF A SALE SURFACE AGAIN
Real – A long term underperformer
Figure 1: Germany: Leading players: Share of food retailers sales, 2014
Hard discounter dominance
Figure 2: Germany: Food retailers by broad category, 2014
Where next?
EUROPEAN RETAIL SALES
Key points
Figure 3: Major European economies: Year-on-year retail sales value growth, 2014-16
Figure 4: Major European economies: Year-on-year retail sales volume growth, 2014-16
Inflation
Figure 5: Major European economies: All items CPI, 2015-16
Figure 6: Major European economies: Food price inflation, 2015-16
HEADLINES FOR THE MONTH
Grocers
Clothing retailers
Multi-sector retailing
Department stores
Electrical retailing
Health and beauty retailing
NEWS ANALYSIS – FOOD AND DRINK
 CONVENIENCE STORES
Ireland: Supervalu reports sales of over €2.6bn
UK: McColl's like-for-like sales fall 1.9%
 GROCERS
Belgium: Albert Heijn and Delhaize must divest stores
Belgium: Colruyt completes integration of Alvocol
Belgium: Delhaize revenues increase 14.2%
France: Carrefour rolls out My Design customisation concessions
France: Auchan
…fresh service lets customers pre-order counter food
…introduces customer rating feature online
France: Casino Group full-year profits tumble
France: Co-operative supermarket projects launch in France
Germany: Aldi Germany launches designer clothing collaboration
Germany: Kaufland prepares for online launch
Germany: Metro Group
…suffers slip in sales in Q1
…trials in-store greenhouse project
Germany: Netto undertakes store modernisations
Italy: Conad to invest €200m expanding in Italy
Italy: Familia reports 2.5% growth in sales
Luxembourg: Lidl reveals Luxembourg expansion plans
Portugal: Jerónimo Martins sales grow 8.3%
Spain: Dia’s full year sales rise 14%
Spain: Mercadona turnover rises 3.3%
Sweden: ICA Gruppen sales grow 5.6% in 2015
UK: Aldi
…expands online offer with SpecialBuys
…hits out at Morrisons' Price Crunch in new campaign
UK: Asda
…Q4 sales tumble 5.8%
…seeks supplier discounts
UK: Lidl launches denim clothing range
UK: Morrisons
…announces new partnerships with Amazon and Ocado
…profits tumble 30%
…to invest £30m in staff facilities
UK: Sainsbury’s to scrap multi-buy promotions
UK: Supermarket sales grow by 0.5%
UK: Tesco
…buys remaining shares in Harris + Hoole
…Morrisons takeover rumours circulate
…reports rising demand for organic fruit
UK: The Co-op pledges another £75m in price cuts
 OTHER SPECIALIST FOOD AND DRINK RETAILERS
UK: Greggs focus on food-on-the-go drives sales
UK: Hotel Chocolat announces flotation plans
UK: Whole Foods delivers profit in the UK
NEWS ANALYSIS – NON-FOOD
 CLOTHING RETAILING
Germany: Gerry Weber realigns to return to profit growth
Germany: Hugo Boss resorts to price cuts in Asia
Spain: Inditex like-for-like sales jump 8.5%
UK: Boden sizes up shoppers
UK: Jigsaw owners mull sale
UK: Joules prepares for £150m float
UK: Levi’s launches clothing recycling initiative
UK: Matalan gains reprieve on its debts
UK: Mothercare and Julien MacDonald collaborate
UK: Primark sales improve after Christmas
UK: TK Maxx grows presence with store openings
UK: Topshop announces Wedgwood collaboration
UK: Uniqlo to relaunch global flagship in London
 FOOTWEAR RETAILING
UK: Alteri saves the majority of Brantano stores
UK: Clarks cuts head office roles
 JEWELLERY RETAILING
Denmark: Pandora UK sales rise 36.4%
UK: Goldsmiths introduces live video chat online
 MULTI-SECTOR RETAILING
France: Steinhoff tables bid for Darty
Spain: El Corte Inglés hoping to generate €1bn from property sale
UK: Home Retail Group
…extends deal deadline with Sainsbury’s
…completes Homebase sale
…receives Argos bid from Steinhoff
…reports mixed results for “eventful” 2015
UK: Menkind forecasting £60m in sales
 NON-FOOD DISCOUNTERS
UK: 99p Stores’
…losses reached £11m before Poundland takeover
…founders and Poundstretcher owner team up for new retailer
UK: easyFoodstore puts a limit on purchasing
UK: Pep&Co’s new discount retailer named ‘Guess How Much!’
UK: Poundland appoints next chief executive
UK: Poundworld to take on up to 20 Brantano stores
 DEPARTMENT STORES
Europe: Hudson’s Bay European sales rise 0.4%
Germany: Kaufhof realigns following takeover
UK: Beales the latest to enter company voluntary arrangement
UK: Bhs
…pension gap wider than previously thought
…secures £10m loan to invest in food business
…seeks rent reductions or stores could close
UK: Debenhams among those implementing digital receipts
UK: Fortnum & Mason sales grow 30% online
UK: John Lewis Partnership sales grow 2.5%
 DIY RETAILING
UK: Homebase management team replaced by Wesfarmers
UK: Kingfisher creates new role of chief customer officer
UK: Travis Perkins sales grow 6.5% in 2015
UK: Wyevale Garden Centres’ owner contemplates sale
 ELECTRICAL RETAILING
France: Fnac full-year sales improve to a 0.5% decline
France: Steinhoff tables bid for Darty
Netherlands: Media Markt experiments with virtual reality store
UK: BrightHouse revenues climb 6.7%
UK: Jessops boosted by 20% jump in sales
 FURNITURE RETAILING
UK: Dreams’ turnaround plan delivers growth
UK: Heals connects online shoppers with store staff
UK: Ikea UK profits surge 128.7%
UK: Sharps’ new concept drives 30% increase in sales
 HOMEWARES RETAILING
UK: Dunelm grows sales by 10.3% in the first half
UK: Søstrene Grene eyes 150 stores in the UK
 HOME SHOPPING
France: Etsy sellers pop-up in Paris department stores
Germany: Mister Spex opens first physical store in Germany
Germany: Zalando expects 20-25% growth in 2016
Ireland: Littlewood Ireland sales rise 2.4%
UK: Amazon to open new logistics centre in Leicestershire
UK: AO World chairman steps down
UK: Asos launches loyalty scheme
UK: Atterley relaunches as an independent retailer portal
UK: Boohoo acquires additional head office space
UK: eBay targets customers watching popular television shows
UK: Gear4Music sales rise 46%
UK: N Brown Group reveals restated debtor impairment provisions
UK: Pinterest to launch promoted pin advertising
UK: Shutl reports demand for ‘click and don’t collect’ service
UK: The Hut Group
…acquires haircare brand Grow Gorgeous
…secures investment as sales rise
 HEALTH AND BEAUTY RETAILING
Europe: The Body Shop
…Q4 sales slip 5.8%
…embeds loyalty app onto mobile
…unveils new ethical pledges
Germany: Douglas
…sales grow 1.9% on a like-for-like basis
…seeks European online expansion
UK: Walgreens Boots Alliance overhauls IT system
 SPORTS AND LEISURE RETAILING
Europe: ASICS Europe delivers 16% growth
UK: Mountain Warehouse ramps up American expansion
UK: Lorna Jane gets active in the UK’s growing sportswear market
UK: Sports Direct’s fashion chains narrow their losses
UK: Wiggle pedals forward with Chain Reaction acquisition
 SHOPPING LOCATIONS
UK: Hammerson reports increase in shopping centre sales
UK: Intu plotting investment of £600m
 ECONOMY
UK: Government faces potential legal action over new Sunday trading laws
UK: January retail sales rise 2.5%
UK: MP's vote against changes to Sunday trading laws
UK: Retail sales slow to 0.1% in February
UK: Retail sector could face up to 900,000 job losses
ELECTRICAL GOODS RETAILING – EUROPE – MARCH 2016 – DARTY GROUP
What we think
Fnac takeover deal
Digital strategy
First-to-market edge over rivals
Marketplace widens product offering and enhances price perception
Rolling out bespoke fitted kitchens offer into more stores
Capitalising on consumer demand for connected technology
Customer services offer
New store card with upgraded credit offering and loyalty benefits
Company background
Company performance
Figure 7: Darty Group: Group financial performance, 2010/11-2014/15
Figure 8: Darty Group: Outlet data, 2010/11-2014/15
Retail offering