European Retail Briefing - July 2017

ANALYST COMMENT
 AMAZON REALLY IS SERIOUS ABOUT FOOD
Whole Foods a good fit
Amazon Fresh a cautious first step
Becoming a mass market player
Cautious and carefully considered
EUROPEAN RETAIL SALES
Key points
Retail sales
Figure 1: Major European economies: Year-on-year retail sales value growth, 2016-17
Figure 2: Major European economies: Year-on-year retail sales volume growth, 2016-17
Inflation
Figure 3: Major European economies: All items CPI, 2016-17
Figure 4: Major European economies: Food price inflation, 2016-17
HEADLINES FOR THE MONTH
Grocers
Other food and drink specialists
Clothing retailing
Multi-Sector retailing
Department stores
Home shopping
NEWS ANALYSIS – FOOD AND DRINK
 CONVENIENCE STORES
UK: Nisa
…profits rise whilst sales fall
…Sainsbury's aims to quell Nisa member rebellion
…explores changes to its ownership structure
…Sainsbury’s frontrunner to buy Nisa Local
 GROCERS
Belgium: Ahold Delhaize to open first till-free supermarket next year
Belgium: Colruyt
…converts stores to low-energy
…posts a 3.4% increase in revenue to €9.4 billion
Denmark: Dansk plans to open 60 new stores
Europe: SPAR hires head of international buying
Finland: Kesko
…launches new vegan initiative
…and Oriola establish new health and wellbeing chain
France: Carrefour
…sales rise in second quarter
…confirms Alexandre Bompard as new CEO
…trialling new convenience stores
France: Système U meets with private label dairy suppliers
Germany: Aldi launches new delivery service for special items
Germany: Edeka Nord posts 3.6% increase in sales for 2016
Ireland: Kerry Foods in emoji marketing campaign
Ireland: Musgrave reports positive financial results for 2016
Italy: Conad reports 1.6% sales increase in 2016
Italy: Coop Italia posts a marginal increase in sales
Italy: Crai has 9% growth in turnover
Italy: Grand Frais announces Italian expansion
Italy: Selex third largest Italian retailer
Spain: Eroski
…extends their campaign focused on health and sustainability
…starts a campaign to focus on local products
Spain: Grupo IFA increases revenue by 5% for 2016
UK: Booker Group posts an increase in sales
UK: Lidl to open 60 new stores a year in UK expansion
UK: Sainsbury’s
…sales rise
…sees 25% growth in gin category year-on-year
UK: Tesco
…posts sixth quarter of like-for-like sales growth
…cuts 1,200 head office jobs
…restructures staff pay
UK: Waitrose to introduce recyclable packaging
 OTHER FOOD AND DRINK SPECIALISTS
Finland: Stockmann sells its Delicatessen grocery stores
France: Naturalia opens three vegan stores
UK: Holland & Barrett
…Superdrug owner AS Watson in rumoured takeover bid
…bought by L1 Capital
…Ireland section of Holland & Barrett sees profits fall by 7%
UK: Majestic Wine sees sales rise whilst profits fall
NEWS ANALYSIS – NON-FOOD
 CLOTHING RETAILING
Europe: Saks OFF 5th comes to Europe
Sweden: H&M
…reports positive growth
…post a 4% increase in sales
…opens first ARKET store
UK: Bonmarché reports a fall in profits and sales
UK: Burberry
…face criticism over executive pay
…new Senior Independent Director appointed at Burberry
UK: Converse opening first standalone UK stores
UK: Edinburgh Woollen Mill owner eyes Aurora Fashions
UK: Fashion retailer Quiz to float on London IPO
UK: Mulberry
…agree to joint venture in Japan
…retail sales rise
UK: New Look
…directors leave the business
…hires chief creative officer
UK: Next
…plan to open in-store restaurants in partnership with Gino D’Acampo
…reveals the name of its new own-brand
UK: Primark’s sales rise whilst margins fall
UK: Ted Baker revenues rise 14.2%
UK: Triumph to close all stores
 FOOTWEAR RETAILING
UK: Clarks to resume manufacturing in UK
UK: LK Bennett sales down 1% as turnaround plan gets underway
 HOMEWARES RETAILING
UK: The White Company to open its first US store
 MULTI-SECTOR RETAILING
Germany: Action opens distribution centre
Germany: Metro Group to proceed with demerger next month
Netherlands: Hema put up for sale
UK: Mothercare sales and profits increase
UK: Poundstretcher owners explore possible sale
 DEPARTMENT STORES
Germany: Karstadt acquires Hood.de
Germany: Signa Retail takes over Mybestbrands
UK: Debenhams sees sales rise
UK: Liberty London announces relaunch of menswear section
 DIY RETAILING
Germany: Hornbach Holding announces strong first quarter
UK: Bunnings
…retail director for B&Q UK & Ireland leaves for Bunnings
…increases number of planned stores
UK: Kingfisher Sales and Operations boss Jean-Paul Constant to leave
UK: Screwfix CEO leaves for rival
UK: Topps Tiles revenues decrease
UK: Travis Perkins launch innovative scheme to work with start-ups
 ELECTRICAL RETAILING
UK: Dixons Carphone reports increased revenue
 CARPET RETAILING
UK: Fall in profits for Carpetright
 FURNITURE RETAILING
UK: DFS downsizes sales estimates following decline in footfall
UK: Dunelm revenues rise in fourth quarter
 HOME SHOPPING
Germany: Amazon Fresh expands across Berlin
Ireland: 50% of all DPD parcels from online shopping
Portugal: Grocery delivery service for tourists
UK: Amazon
…announces 20 new brands to be added to its Dash range
…to buy Whole Foods in $13.7 billion deal
UK: Boohoo confirms new Non-Executive Director appointment
UK: CollectPlus offers on-demand return service
UK: Joe Browns launches debut store
UK: N Brown
…posts 5.6% increase in group revenue, but closes five stores
…chairman to step down
UK: Ocado
…trialling self-driving vehicles
…profits fall
…revenues rise 24.7%
UK: Shop Direct
…luxury director resigns
…to be taken over
UK: Tesco launches 60 minute deliveries
 HEALTH AND BEAUTY RETAILING
UK: Superdrug sees sales and profits rise
UK: The Body Shop bought by Natura
 BOOK AND STATIONERY RETAILING
UK: Smiggle plans to double UK presence to 235
UK: WH Smith sales up 2%
 SPORTS AND LEISURE GOODS RETAILING
Europe: Intersport looking to expand e-commerce business
UK: Cotswold Outdoors new store launch initiative ‘Find your Outdoors’
UK: Evans Cycles fall in earnings
UK: JD Sport
…growth in line with expectations
…to open dual shop and gym
 TOYS AND GAMES RETAILING
UK: Game posts decrease in sales
UK: Hamleys
…CEO steps down
…chief finance officer to step down
UK: Hobbycraft sales rise but profits fall
 ECONOMY
UK: Footfall drops 1% in May
UK: Retail sales growth driven by inflation
ZALANDO
What we think
Mobile is at the heart of the business
Prioritising delivery to drive customer loyalty
Geo-localised delivery being trialled
Moving from following to leading
Integrated commerce links up online and offline channels
Fulfilment service reaches out to brands
Company background
Company performance
Figure 5: Zalando: Group financial performance, 2012-16
Figure 6: Zalando: Key metrics, 2015-Q1 2017
Retail offering