Stable performance and continued focus on long-term growth ICA Gruppen Capital Markets Day, December 11, 2019 Anders Svensson Deputy CEO ICA Gruppen & CEO ICA Sweden Peter Muld Chief Strategy & Digital Officer ICA Sweden Focus on growth with stable profitability
• Improved profitability in 2019 • Objectives going forward: – grow sales – take market share – maintain margin level • Digitalization and e-commerce key contributors to growth • Store network refurbishment and developing the assortment important for continued success • A more lean and agile organization in place
2 The challenges are the same everywhere
E-COMMERCE PRICE VALUE CONVENIENCE
3 Priorities are in line with trends and we are delivering according to plan
E-commerce Meal solutions Price
Sustainability and health Personalisation
4 We have a strong base to continue growing our E-commerce…
First step for a new Ongoing work E-commerce 300 to prepare for warehouse in stores Ocado Gothenburg now with online services
5 …and we are outperforming the market YTD
Sales growth compared to last year (%) – ICA vs. the market
52% 53% 52% ICA-stores 50% 46% 42% +36% 41% ICA 38% (YTD Sep 2019) 35% 36% 34%
Market +24% MARKET (YTD Sep 2019)
19% 18% 29% 27% 32% 29% 26% 22% 19% 24% 30%
17 Q1 17 Q2 17 Q3 17 Q4 18 Q1 18 Q2 18 Q3 18 Q4 19 Q1 19 Q2 19 Q3
6 Meal solutions now develops in line with total meal market
172 new “take +5.9% growth away” concepts Private Label drives sales
Sales growth +245 MSEK YTD
7 ICAnders – a pilot store to test new meal concepts and to inspire ICA stores
8 Our price value has strengthened…
Improved price perception with customers Campaign efficiency increased
9 ..and this is how we are building price value
Rebalancing price Price value on A more intelligent Campaign & promotion per regular prices support system optimisation profile fruit & vegetables for regular prices
Optimize customer value AND profitability in the stores
10 Launch of improved loyalty program
Any card can be connected
Apotek Hjärtat, ICA Bank & ICA Insurance
More transactions identified
Driver of personalisation
Launch Q1 2020
11 We achieve awards for sustainability and health
50 new vegan products
Smarter packaging
12 KL2020* – rolled out and we see positive effects
Campaign ICA +7.6% 450 MSEK more recipes increased added to sales effect shopping list
Customers receiving Users on our 4x personalized digital channels higher e-mail spend redemption +44 50% rate SEK more more
13 *Customer loyalty 2020 E-commerce – key enabler to create growth Full focus on continued market leadership and to be the most relevant retailer for our customers – online and offline
Automation New organisation Scale the use of software A new agile organisation robots (RPA/SPA) to make better equipped to handle our business more efficient a faster moving world and lean
E-commerce and omni channel Personalisation Implement world leading Custom-made personalized E-commerce and connect offerings thanks to advanced the experience regardless analytics that are more of channel efficient and increase buying
15 ICA became market leader in 2017 with continued good growth into 2018-19 77% Geographic coverage, % of population Online food sales 2,150 MSEK 1,750
23% Stores offering e-com, 1,200 % of total #
Menu 800 baskets 550 Groceries 3.1% Share of sales, participating stores
2015 2016 2017 2018 19 Q3 R12
ICA’s growth +41% +43% +51% +42% +36% Share of total 1.8% store sales Market growth +40% +30% +19% +27% +24%
16 E-commerce growth drivers – local leadership and strong offer
Strong performance Local leadership Strong offer
1,060 SEK / basket 650 stores Market leader
84% 88% 300 customer would stores satisfaction recommend ICA
17 The ”ICA idea” with independent retailers has been an important driver in reaching market leadership
… both in store and The online ICA-retailer owns the relationship with the customer…
18 New E-commerce warehouses in big cities
• Creates a stronger customer offering • Increases sales and market share • Improves efficiency
2018 2020 2022 Stockholm Göteborg Stockholm (Jordbro) (Arendal) (Brunna)
19 First pilot for an Ocado-powered solution will be launched autumn 2020
• World leading e-commerce solution for groceries (2021) • Highly automated logistics (2022) to create cost efficiency and a superior customer offering • Part of the Ocado client network including Morrisons, Marks & Spencer, Kroger, Casino, Sobeys, Coles and Aeon • Access to world leading knowledge and know-how both on logistics and on grocery E-commerce
20 Going forward into the next decade
• We continue to deliver stable results on a high level • We are making good progress on our growth strategies • We will increasingly benefit from our investments
21 APPENDIX
22 ICA store margins improved in 2018
4,00% Retailer owned ICA stores EBIT % 3,50% adjusted for paid profit share
3,00%
2,50%
2,00%
1,50%
1,00% ICA Sweden EBIT as % of store sales* 0,50%
0,00% 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
*Also incl. Non-food and consolidated stores
23 Disclaimer
Forward-looking statements This presentation contains forward-looking statements. Such statements are subject to risks and uncertainties as various factors, many of which are beyond the control of ICA Gruppen AB (publ.), may cause actual developments and results to differ materially from the expectations expressed in this presentation.
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