Retail & Consumer Deals Digest

www.pwc.com.au/dealsdigest Retail & Consumer Deals Digest February 2017

Consumer confidence edges Latest Australian ABS trade down to 116.4 results Consumer confidence fell by 0.9% to 116.4 The latest Australian Bureau of Statistics this week, the second straight week of (ABS) Retail Trade figures show that decline, however it remained well above Australian retail turnover fell 0.1% in its long run average of 112.9. December 2016 (seasonally adjusted), According to ANZ Head of Australian following a rises of 0.1% in November Economics David Plank, the slight fall in 2016 and 0.4% in October 2016. consumer confidence is disappointing, The sectors rising in trend terms in the given the recent positive data around month of December 2016 were: Food business conditions and house prices as retailing (0.4%), Household goods well as some recovery in domestic stock retailing (0.3%), Clothing, footwear and prices. personal accessory retailing (0.3%), Cafes, The decline may reflect the current global restaurants and takeaway food services (0.2%), Department stores (0.1%) and Retail & Consumer Deals policy uncertainty as well as downward Digest provides a revisions to growth in last week’s Other retailing (0.1%). consolidated view of sector Statement on Monetary Policy. The labour On a state level, retail sales rose in trend trends, deal activity and relevant news headlines in the force report due to be released soon has terms in the Northern Territory (0.6%), retail & consumer sector. the potential to impact confidence. Victoria (0.4%), New South Wales (0.3%), Queensland (0.3%), Tasmania (0.3%), the ANZ / Roy Morgan weekly consumer Australian Capital Territory (0.2%), South confidence rating Australia (0.1%) and Western Australia (0.1%) in December 2016. Sources: Australian Bureau of Statistics data, Reserve Bank of Australia

Source: ANZ / Roy Morgan Weekly Consumer Confidence Index

FY2017TD PCP LTM PCP Deal value (in A$m) # of deals Deal value # of deals Deal value # of deals Deal value # of deals Deal value $0to$5M 0 0 0 0 0 0 0 0 $6 to $10M 6 52 5 45 7 62 12 98 $11 to $20M 5 74 12 202 9 133 18 293 $21 to $30M 4 105 3 76 8 201 4 97 $31 to $50M 4 175 8 304 6 241 8 304 $51 to $100M 5 441 7 543 8 665 11 830 $101 to $300M 4 590 12 2,265 7 1,113 19 3,601 $301 to $500M 5 1,990 1 340 7 2,668 2 750 >$500M 4 3,886 1 1,386 5 4,944 2 2,239 Subtotal 37 7,313 49 5,161 57 10,027 76 8,212 Undisclosed 38 n/a 19 n/a 51 n/a 31 n/a Total Announced 75 7,313 68 5,161 108 10,027 107 8,212 Total Completed 42 1,230 62 4,200 68 3,228 69 4,373

Source: Mergermarket; based on announced and completed transactions as at 14 February 2017 Notes: 1) FY2017TD refers to the period 1 July 2016 to 14 February 2017, reflecting the latest available Mergermarket data as at 14 February 2017 2) PCP refers to prior year comparable period Recently completed / announced deals • 8 February 2017 – PAG Capital, a Hong Kong-based private equity firm, has acquired The Cheesecake Shop, an Australia-based cake retailer through a franchise network with over 200 stores in Australia, New Zealand and UK, for a total consideration of AUD 100m. The transaction will provide The Cheesecake Shop with a strong financial backing and funds to expand its network. Post transaction The Cheesecake Shop will continue to meet its obligations under its franchise agreement retail leases and related agreements. • 31 January 2017 – Pacific Equity Partners has agreed to acquire Allied Mills, an Australia-based manufacturer and distributor of bakery premixes, flour and semi-finished products, for an enterprise value of AUD 455m. Under the terms of agreement, PEP will acquire 60% stake from GrainCorp for a consideration of AUD 190m and remaining 40% stake acquire from Cargill. • 30 January 2017 – Only a matter of months after it failed to force out minority shareholders, Canada's largest milk processor, Saputo, has placed a cash offer on the table for the remaining shareholders of Warrnambool Cheese and Butter - offering less than it paid when it took control of the company three years ago. Saputo on Monday said it would offer $8.85 cash a share for Warrnambool Cheese and Butter shares, valuing the entire company at $682 million. But the target's third largest shareholder, Sandon Capital, says a $2.20-$2.25 fully franked dividend should be paid as part of the any offer. If it succeeds, it will be the second time in a matter of weeks foreign investors have strengthened their position in the domestic dairy industry, since it comes after a deal between Bellamy's Australia and New Zealand's Fonterra that gave the Kiwi group sway over Bellamy's future. • 18 January 2017 – Bega Cheese (ASX: BCL) has agreed to acquire the grocery and cheese business of Mondelez International (NASDAQ: MDLZ) based in Australia and New Zealand for a consideration of AUD 460m. The acquisition include MDLZ’s owned brands — VEGEMITE, ZoOsh, Bonox — and other products that use the Kraft brand under license. The transaction adds further diversification to Bega’s large B2B dairy foods and nutritional businesses, adds significant depth and expertise to BCL’s management, complements the operational capability to facilitate further growth and strengthens Bega’s Australian and international cheese manufacturing profile.

© 2017 PricewaterhouseCoopers. All rights reserved. PwC refers to the Australian member firm, and may sometimes refer to the PwC network. Each member firm is a separate legal entity. Please see www.pwc.com/structure for further details. This material has been prepared by PwC for general circulation on matters of interest only. It is not advice and does not take into account the objectives, financial situation or needs of any recipient. Any recipient should, before acting on this material, make their own enquiries and obtain their own professional advice in relation to any issue or matter referred to herein. We do not, in preparing this material, accept or assume responsibility for any purpose or to any person to whom this material is shown and shall not be liable in respect of any loss, damage or expense whatsoever caused by any use the reader June choose to make of this material. © 2016 PwC. All rights reserved. "PwC" refers to PricewaterhouseCoopers, an Australian limited liability partnership, or as the context requires, the PricewaterhouseCoopers global network or other member firms of the network each of which is a separate and independent legal entity. Recently completed / announced deals (cont’d) • 28 December 2016 – BP (LON: BP) has agreed to acquire 527 fuel convenience sites and 16 committed development sites of Woolworths (ASX:WOW) for a total consideration of AUD 1.785bn. The transaction will result in Woolworths having a larger platform for its redemption and reward program and will provide it with a unique opportunity to partner with and draw on BP’s success in rolling out market-leading convenience food offers globally. The acquisition of Woolworths’ fuel and convenience sites will add to BP’s existing network of 350 company-owned retail sites across Australia. The integration of BP’s international experience and expertise in fuel and convenience offers with Woolworths’ network, high-quality food products and loyalty program will enable the combined company to provide enhanced services to its customers. The transaction is expected to be completed post 2 January 2018. • 12 December 2016 – Newell Brands (NYSE: NWL), a manufacturer of branded consumer and commercial products, has agreed to acquire Sistema Plastics, a manufacturer, marketer and distributor of plastic kitchen storage containers, from Mr. Brendan Lindsay for a consideration of NZD 660m. The acquisition is part of Newell Brands’ ongoing effort of simplifying and strengthening its portfolio and will strengthen Newell Brands’ positions in Food Storage, Beverage and Home Fragrance category, allow Newell Brands to use Sistema’s manufacturing facility in New Zealand to meet its capacity needs and Newell Brands’ geographic presence and its presence in the Beverages category. It will also provide Sistema with opportunities to expand in North American market. Also recently in the news • National retail spending saw three per cent growth year-on-year in December (seasonally adjusted), showing a positive Christmas performance, according to the latest Australian Bureau of Statistics trade figures. Seasonally adjusted retail spending was $25.6 billion in December, according to the ABS retail trade figures. The Australian Retailers Association (ARA) believes the December 2016 retail trade figures illustrate a positive Christmas performance for retailers. Russell Zimmerman, ARA executive director, said this steady growth compliments the three per cent year-on year growth in November 2016 as many families across Australia started purchasing their Christmas gifts early. • US food company Kraft Heinz withdrew its proposal for a $US143 billion merger with larger rival Unilever, the companies announced, raising questions about whether Kraft could turn its focus to another target. Kraft had made a surprise offer for Unilever to build a global consumer goods behemoth that was flatly rejected on 17 February by Unilever, the maker of Lipton tea and Dove soap. Kraft withdrew its offer because it felt it was too difficult to negotiate a deal following the public disclosure of its bid so early after its approach to Unilever, according to people familiar with the matter who requested anonymity to discuss confidential deliberations. • Thirteen David Lawrence and Marcs fashion stores will close and 20 staff will lose their jobs as administrators hunt for a buyer to save the troubled retailers. The Administrators advised that the decision was made after a review of the businesses placed in voluntary administration on 2 February. • The Queensland government will overhaul the state’s retail trading hours after a review found the current provisions are over-complicated and costly. The review, conducted by former speaker John Mickel, found many trading hours regulations in the state did not pass the “common-sense test.” Premier Annastacia Palaszczuk said the reforms simplified about 99 trading hour provisions down to just six. The reforms will see Sunday and public holiday trading hours standardised across the state, as well as a number of other changes, including increasing the number of shops which can trade at the increased hours such as butchers and hardware stores. • Consumer electronics retailer JB Hi-Fi has lifted first-half net profit 15.99 per cent (31.7 per cent on the prior corresponding period) to $110.4 million. The retailer says total sales revenue for the six months to December 31 has also risen, by 23.59 per cent to $2.6 billion from $2.1 billion in the same period the previous year. JB Hi-Fi will pay a fully franked interim dividend of 72 cents per share, up nine cents. • Fashion retailer, Jeanswest, has launched its latest capsule collection Jeanswest Africa, where they partnered with Ethical Apparel Africa to engage local businesses in Ghana to produce the new range of ethical clothing. Jeanswest announced its new collection was made by skilled artisans in Ghana in order to promote a sustainable future for them and their communities. • The operators of an Australian-themed retail outlet in Melbourne have been fined over $120,000 for underpaying three shop assistants more than $90,000 over five years. Something Aussie Pty Ltd has been penalised $101,400 and its sole director, Kuan Kok Kan, a further $20,280 in the Federal Circuit Court in Melbourne following legal action by the Fair Work Ombudsman. Source: Inside Retail

© 2017 PricewaterhouseCoopers. All rights reserved. PwC refers to the Australian member firm, and may sometimes refer to the PwC network. Each member firm is a separate legal entity. Please see www.pwc.com/structure for further details. This material has been prepared by PwC for general circulation on matters of interest only. It is not advice and does not take into account the objectives, financial situation or needs of any recipient. Any recipient should, before acting on this material, make their own enquiries and obtain their own professional advice in relation to any issue or matter referred to herein. We do not, in preparing this material, accept or assume responsibility for any purpose or to any person to whom this material is shown and shall not be liable in respect of any loss, damage or expense whatsoever caused by any use the reader June choose to make of this material. © 2016 PwC. All rights reserved. "PwC" refers to PricewaterhouseCoopers, an Australian limited liability partnership, or as the context requires, the PricewaterhouseCoopers global network or other member firms of the network each of which is a separate and independent legal entity. Also recently in the news (cont’d) • Domino’s Pizza has responded to recent media reports of squeezing its franchisees and underpaying employees, defending its record of profitability and franchisee relationships. Ahead of its half year results announcement, the pizza chain said it “works closely with franchisees in relation to marketing, training, technology and administrative support to provide them with the best opportunity for profitability and success” and this meant the number of small businesses that did not make a profit in the last 12 months had reduced to 21 in the last financial year. • Following this, Domino’s reported its lifted continuing operations half-year profit eight per cent to $50 million after record network sales breached the $1 billion mark during the six months to December 31. The company has also upgraded its full-year guidance, expecting net profit and underlying earnings to increase by 32.5 per cent in 2016/17. It will pay a partially franked interim dividend of 48.4 cents a share, up 39.5 per cent from the same period a year earlier. • Retail and industrial conglomerate group, Wesfarmers, has lifted its half-year profit by 13.2 per cent to $1.5 billion, driven by strong performances by Bunnings, Kmart and Officeworks. Coles earnings for the half year have slipped 2.6 per cent to $920 million as its sales growth slows further amid heavy grocery discounting led by Woolworths. Food and liquor comparable sales, which strips out one-off events, rose 1.3 per cent in the six months to December 31, much slower than the 4.3 per cent growth recorded in the same period a year ago. Surprisingly, Wesfarmers said it’s considering spinning off its Officeworks business and is evaluating options to monetise its value, including through an initial public offer. • Furniture retailer Nick Scali’s sofas, dining and coffee tables are selling like hot cakes, thanks to Australia’s strong housing market. The retailer posted a 44.7 per cent increase in first half net profit, driven by 15.5 per cent rise in revenue to $118.4 million. The company, which operates under the Nick Scali and Sofas2Go brands, reported gross margins strengthened to 62.0 per cent largely as a result of economies of scale from volume growth in its specialised categories. Operating expenses decreased as a percentage of sales to 36.4 per cent due to continued attention to the control of costs and seeking efficiencies. Excluding three new stores opened in the six months to December 31, comparable sales rose 10.1 per cent over the six month period. • Apparel retailer, Specialty Fashion Group, announced it is expecting EBITDA of $30 million, subject to final auditor review, which represents an 11-per cent increase on its underlying EBITDA for the half year ending December 31, 2016. The group stated the increase was achieved despite difficult trading conditions experienced across the specialty retail sector in Australia during the half year to 31 December. The result, according to the company, was underpinned by strong progress against the group’s three key growth priorities: rejuvenation of existing brands across the group; transformation of Rivers into a profitable brand; and expansion into new markets beyond Australia for City Chic. Specialty Fashion is currently considering a takeover bid from Qatar based investment company Al Alfia Holdings WLL. The deal would result in the ASX-listed retailer becoming a private company, with the undisclosed investment company offering 70 cents a share in a bid that values the company at about $135 million. • Howards Storage World has been sold to an as yet unnamed buyer, said to be an experienced retailer with both international and local retail and franchisee experience. Following a restructure of the Group’s operations, the business and its franchise network has been sold, though the identity of the buyer and the terms of the sale are confidential. • Wesfarmers has announced that Rob Scott will succeed Richard Goyder as managing director towards the end of this year. Goyder steps down after 12 years in the role, during which time the conglomerate’s value has increased from $15 billion to around $50 billion – including the major acquisition of Coles Group in 2007. Scott becomes the group’s deputy CEO effective immediately and will assume the MD role after Wesfarmers’ AGM in November, while continuing to head up the company’s Industrials division till July of this year. • Retail landlord Stockland has officially ‘switched on’ its second single rooftop solar system recently installed at its Wetherill Park Shopping Centre to provide renewable energy to the centre and its 210 retailers. The $2 million 925kW solar PV system, installed by Autonomous Energy, consists of more than 2,900 solar Photo- Voltaic (PV) panels across a total roof surface area of 5,695sqm – equivalent to around 13 average sized home lots. Source: Inside Retail © 2017 PricewaterhouseCoopers. All rights reserved. PwC refers to the Australian member firm, and may sometimes refer to the PwC network. Each member firm is a separate legal entity. Please see www.pwc.com/structure for further details. This material has been prepared by PwC for general circulation on matters of interest only. It is not advice and does not take into account the objectives, financial situation or needs of any recipient. Any recipient should, before acting on this material, make their own enquiries and obtain their own professional advice in relation to any issue or matter referred to herein. We do not, in preparing this material, accept or assume responsibility for any purpose or to any person to whom this material is shown and shall not be liable in respect of any loss, damage or expense whatsoever caused by any use the reader June choose to make of this material. © 2016 PwC. All rights reserved. "PwC" refers to PricewaterhouseCoopers, an Australian limited liability partnership, or as the context requires, the PricewaterhouseCoopers global network or other member firms of the network each of which is a separate and independent legal entity. Retail sector multiples

Share Mkt Net DividendEV / EBITDA EV / EBIT PE TSR % price cap EV debt / Yield Actual Forecasts Growth Actual Forecasts Growth Actual Forecasts Company Currency $ million million EV LTM % Jan-17 LTM CY2017 CY2018 LTM-17 LTM CY2017 CY2018 LTM-17 LTM CY2017 CY2018 Restaurants / Fast Food Domino's Pizza Enterprises Limited AUD 53.56 4,758 5,010 5% 1.6 -9% 27.0x 18.6x 15.0x 34.2% 33.8x 22.5x 17.7x 38.0% n/m 33.5x 26.3x Retail Food Group Limited AUD 6.30 1,109 1,299 15% 4.4 -8% 12.5x 9.3x 8.4x 21.7% 13.3x 9.8x 8.9x 22.4% 18.6x 12.7x 11.6x Restaurant Brands New Zealand Limited NZD 5.36 658 726 9% 4.1 9% 12.2x 8.1x 7.3x 29.2% 18.6x 11.6x 10.2x 34.9% 23.4x 15.8x 14.0x Collins Foods Limited AUD 5.81 557 686 19% 2.8 -8% 8.9x 7.6x 7.1x 11.6% 12.4x 10.6x 9.9x 12.1% 18.7x 14.4x 13.2x Mean 15.1x 10.9x 9.5x 24.2% 19.5x 13.6x 11.7x 26.9% 20.2x 19.1x 16.3x Median 12.3x 8.7x 7.9x 25.4% 16.0x 11.1x 10.1x 28.6% 18.7x 15.1x 13.6x FMCG - Beverage Coca-Cola Amatil Limited AUD 9.96 7,605 9,180 14% 4.5 -4% 10.1x 9.3x 9.0x 5.9% 13.7x 13.0x 12.6x 4.1% 21.0x 17.8x 17.1x Treasury Wine Estates Limited AUD 11.74 8,650 8,950 3% 2.1 9% 16.9x 14.5x 13.0x 14.3% 21.0x 18.1x 15.8x 15.4% 34.6x 27.3x 22.8x Delegat Group Limited NZD 6.12 619 911 32% 2.0 3% 9.4x 10.3x 9.3x 0.7% 10.7x 12.6x 11.2x -2.3% 13.1x 14.8x 12.8x Australian Vintage Ltd AUD 0.53 127 229 45% 2.8 5% 12.9x 8.1x n/m n/a 19.2x 12.6x n/m n/a 32.3x 17.3x n/m Gage Roads Brewing Co Limited AUD 0.04 35 41 15% - - 14.8x n/m n/m n/a 25.1x n/m n/m n/a 28.1x n/m n/m Mean 12.8x 10.6x 10.4x 7.0% 18.0x 14.1x 13.2x 5.7% 25.8x 19.3x 17.6x Median 12.9x 9.8x 9.3x 5.9% 19.2x 12.8x 12.6x 4.1% 28.1x 17.6x 17.1x FMCG - Food & Dairy Fonterra Co-operative Group Limited NZD 6.20 9,945 16,028 37% 6.5 3% 9.0x n/m n/m n/a 12.2x n/m n/m n/a 18.9x n/m n/m Blackmores Limited AUD 116.01 1,998 2,016 1% - 12% 14.5x 14.1x 12.3x 8.9% 15.3x 15.6x 13.3x 7.1% 25.1x 28.1x 18.2x Bega Cheese Limited AUD 5.57 850 903 6% 1.7 21% 14.1x 11.9x 9.8x 19.9% 21.7x 17.4x 13.5x 26.7% 34.1x 26.1x 21.1x Bellamy's Australia Limited AUD 4.84 468 436 -7% 2.5 -37% 8.1x 17.3x 14.6x -25.8% 8.1x 17.9x 15.2x -27.1% 13.6x 30.7x 26.0x The a2 Milk Company Limited NZD 2.56 1,858 1,749 -6% - 4% 17.3x 15.4x 12.9x 16.0% 17.5x 15.8x 13.1x 15.3% 29.1x 32.0x 19.1x Warrnambool Cheese And Butter Factory CompanyAUD Holdings Limited 8.84 681 676 -1% - 23% 20.8x n/m n/m n/a 42.9x n/m n/m n/a 39.6x n/m n/m Freedom Foods Group Limited AUD 4.19 837 869 5% 1.0 -13% 49.1x 20.5x 15.0x 80.6% n/m 27.8x 19.9x n/a 34.2x 39.9x 28.7x Synlait Milk Limited NZD 3.22 577 790 27% - - 9.5x 8.3x 7.1x 15.3% 12.8x 11.2x 9.4x 16.5% 15.4x 13.1x 10.7x Comvita Limited NZD 6.90 290 374 22% 2.1 -11% 14.0x 13.1x 9.0x 24.4% 17.3x 18.9x 11.3x 23.8% n/m 19.0x 13.4x Capilano Honey Limited AUD 15.16 143 156 8% 2.6 -7% 11.2x 9.1x 8.2x 17.1% 13.0x 10.2x 9.1x 19.6% 19.8x 13.4x 12.2x Mean 16.8x 13.7x 11.1x 19.6% 17.9x 16.8x 13.1x 11.7% 25.5x 25.3x 18.7x Median 14.1x 13.6x 11.0x 16.6% 15.3x 16.6x 13.2x 16.5% 25.1x 27.1x 18.7x FMCG - Food (Production) Inghams Group Limited AUD 3.33 1,266 1,666 24% - -1% n/m 8.6x 7.9x n/a 26.8x 11.0x 10.2x 62.3% n/m 12.3x 10.9x Australian Agricultural Company Limited AUD 1.48 827 1,234 33% - -14% n/m 29.8x 22.2x n/a n/m n/m 34.7x n/a n/m n/m n/m Costa Group Holdings Limited AUD 3.58 1,142 1,242 8% 2.5 -5% 22.1x 12.3x 10.8x 42.8% 35.5x 16.8x 14.6x 55.7% 51.8x 19.9x 17.0x Select Harvests Limited AUD 5.54 407 474 14% 8.3 -16% 8.8x 7.8x 7.0x 12.2% 11.4x 10.2x 8.9x 13.3% 17.8x 13.4x 11.4x Tassal Group Limited AUD 4.49 675 811 17% 3.3 11% 8.2x 8.4x 7.6x 4.4% 10.6x 11.1x 9.9x 3.6% 15.3x 14.9x 13.3x Tegel Group Holdings Limited NZD 1.30 463 607 24% 2.7 -5% 9.2x 7.5x 6.9x 15.5% 12.7x 9.8x 9.1x 18.4% 15.0x 11.8x 11.8x Webster Limited AUD 1.42 496 681 27% 0.7 0% n/m 14.4x 12.7x n/a n/m 17.1x 14.7x n/a n/m 21.0x 17.5x Sanford Limited NZD 7.01 655 830 21% 3.3 5% 10.9x 9.3x 8.6x 12.3% 13.7x 11.7x 10.6x 13.4% 19.5x 14.9x 13.1x Huon Aquaculture Group Limited AUD 4.60 402 464 13% - 18% 17.2x 8.3x 6.7x 60.3% n/m 12.8x 9.4x n/a n/m 17.7x 12.5x Mean 12.7x 12.2x 10.3x 24.6% 16.8x 12.8x 14.0x 20.9% 23.9x 16.2x 13.8x Median 10.1x 8.9x 8.1x 13.9% 12.7x 11.7x 10.3x 13.4% 17.8x 14.9x 13.1x FMCG - Other Asaleo Care Limited AUD 1.47 808 1,089 26% 6.8 2% 8.1x 8.2x 8.3x -1.0% 10.2x 10.6x 10.6x -2.1% 14.0x 12.7x 13.6x BWX Limited AUD 4.86 449 448 0% 1.5 10% 19.4x 14.9x 12.1x 26.5% 20.1x 15.2x 11.6x 31.5% 33.5x 23.5x 18.8x Trilogy International Limited NZD 2.53 183 203 10% 2.2 -5% 11.2x 13.0x 11.8x -2.4% 11.6x 13.5x 12.3x -3.0% 18.5x 13.1x 11.9x Shaver Shop Group Limited AUD 0.69 86 86 1% - 3% 7.2x 5.8x 4.8x 22.8% 7.9x 6.6x 5.5x 19.8% 9.3x 9.5x 7.8x Pental Limited AUD 0.61 82 70 -18% 4.9 -3% 7.0x 5.5x 4.8x 20.7% 9.0x 7.5x 6.6x 17.2% 16.0x 12.7x 11.2x Mean 10.6x 9.5x 8.4x 13.3% 11.8x 10.7x 9.3x 12.7% 18.3x 14.3x 12.7x Median 8.1x 8.2x 8.3x 20.7% 10.2x 10.6x 10.6x 17.2% 16.0x 12.7x 11.9x E-commerce SEEK Limited AUD 15.01 5,201 5,902 4% 2.7 -3% 17.0x 14.2x 12.7x 16.0% 18.3x 16.8x 14.7x 11.7% 39.5x 25.0x 20.4x REA Group Limited AUD 54.54 7,184 7,511 4% 1.6 -5% 22.2x 17.5x 15.3x 20.3% 23.0x 19.7x 16.8x 17.1% 35.6x 25.8x 22.5x carsales.com Ltd AUD 11.12 2,685 2,866 6% 3.4 -8% 17.1x 15.3x 14.2x 9.6% 17.5x 16.0x 14.8x 8.6% 27.4x 20.6x 19.5x Trade Me Group Limited NZD 5.07 2,014 2,117 5% 3.3 1% 16.7x 13.0x 12.0x 17.8% 17.2x 15.1x 13.8x 11.4% 27.8x 20.5x 18.7x Webjet Limited AUD 11.51 1,127 1,067 -6% 1.3 6% 31.9x 16.4x 13.3x 54.5% 34.4x 18.9x 15.1x 51.1% 49.3x 26.2x 20.8x Infomedia Ltd. AUD 0.73 227 212 -7% 3.6 -1% 13.9x 8.3x 7.4x 36.7% 14.8x 12.9x 11.1x 15.3% 28.7x 17.5x 15.5x Mean 19.8x 14.1x 12.5x 25.8% 20.9x 16.6x 14.4x 19.2% 34.7x 22.6x 19.6x Median 17.0x 14.7x 13.0x 19.1% 17.9x 16.4x 14.8x 13.5% 32.1x 22.8x 19.9x Source: PwC calculations based on CapitalIQ data and publicly available information; share prices as at 15 February 2017 market close Notes: 1) Information from CapitalIQ used in calculations has not been verified or adjusted, unless otherwise noted 2) 2017 and 2018 calendar year forecasts represent consensus estimates for each company © 2016 PricewaterhouseCoopers. All rights reserved. PwC refers to the Australian member firm, and may sometimes refer to the PwC network. Each member firm is a separate legal entity. Please see www.pwc.com/structure for further details. This material has been prepared by PwC for general circulation on matters of interest only. It is not advice and does not take into account the objectives, financial situation or needs of any recipient. Any recipient should, before acting on this material, make their own enquiries and obtain their own professional advice in relation to any issue or matter referred to herein. We do not, in preparing this material, accept or assume responsibility for any purpose or to any person to whom this material is shown and shall not be liable in respect of any loss, damage or expense whatsoever caused by any use the reader may choose to make of this material. © 2012 PwC. All rights reserved. "PwC" refers to PricewaterhouseCoopers, an Australian limited liability partnership, or as the context requires, the PricewaterhouseCoopers global network or other member firms of the network each of which is a separate and independent legal entity. Retail sector multiples (cont’d)

Source: PwC calculations based on CapitalIQ data and publicly available information; share prices as at 15 February 2017 market close Notes: 1) Information from CapitalIQ used in calculations has not been verified or adjusted, unless otherwise noted 2) 2017 and 2018 calendar year forecasts represent consensus estimates for each company © 2016 PricewaterhouseCoopers. All rights reserved. PwC refers to the Australian member firm, and may sometimes refer to the PwC network. Each member firm is a separate legal entity. Please see www.pwc.com/structure for further details. This material has been prepared by PwC for general circulation on matters of interest only. It is not advice and does not take into account the objectives, financial situation or needs of any recipient. Any recipient should, before acting on this material, make their own enquiries and obtain their own professional advice in relation to any issue or matter referred to herein. We do not, in preparing this material, accept or assume responsibility for any purpose or to any person to whom this material is shown and shall not be liable in respect of any loss, damage or expense whatsoever caused by any use the reader may choose to make of this material. © 2012 PwC. All rights reserved. "PwC" refers to PricewaterhouseCoopers, an Australian limited liability partnership, or as the context requires, the PricewaterhouseCoopers global network or other member firms of the network each of which is a separate and independent legal entity. Retail sector multiples (cont’d)

Supermarkets Wesfarmers Limited AUD 43.33 49,004 54,340 10% 4.6 -4% 11.8x 9.3x 9.0x 14.3% 15.8x 12.1x 11.7x 16.3% 23.0x 17.3x 16.1x Woolworths Limited AUD 25.36 32,564 36,289 9% 3.0 2% 10.1x 10.1x 9.4x 3.7% 14.2x 14.2x 13.2x 3.5% 12.5x 23.0x 18.8x Metcash Limited AUD 2.24 2,185 2,409 9% - -7% 12.7x 6.5x 6.2x 43.2% 16.7x 8.1x 7.7x 47.6% 15.7x 11.8x 10.2x Mean 11.5x 8.7x 8.2x 20.4% 15.5x 11.5x 10.8x 22.5% 17.1x 17.3x 15.0x Median 11.8x 9.3x 9.0x 14.3% 15.8x 12.1x 11.7x 16.3% 15.7x 17.3x 16.1x

EV/forward EBITDA multiples (over last 24 months)

EV/Forward EBITDA Multiples EV/Forward EBITDA Multiples EV/Forward EBITDA Multiples

12.0x 16.0x 17.0x

10.0x 14.0x 15.0x

8.0x 12.0x 13.0x

6.0x 10.0x 11.0x

4.0x 8.0x 9.0x

2.0x 6.0x 7.0x

0.0x 4.0x 5.0x 5 5 5 5 5 5 5 5 5 5 5 5 6 6 6 6 6 6 6 6 6 6 6 6 7 5 5 5 5 5 5 5 5 5 5 5 5 6 6 6 6 6 6 6 6 6 6 6 6 7 5 5 5 5 5 5 5 5 5 5 5 5 6 6 6 6 6 6 6 6 6 6 6 6 7 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 ------l l l l t t r r r r l l t t r r r r t t r r r r y v c y v c y y b g p b g p v c v c n n n n n y v c y v c b g p b g p n n n n n g p g p n b n n b n n u c u c u c u c a a c c p p u u a p a p a a p p a a o e o e a e u a e u a u e u e a a a a o e o e o e o e a e u a e u a a e u a e u a u e u e u e u e J J J J J J A O A O J J J J J A O A O A O A O F M F M J J J J J J J J J J A S N D A S N D F M F M F M F M M M A S N D A S N D A S N D A S N D M M M M

Supermarkets Department Stores Apparel Restaurants / Fast Food FMCG - Food & Dairy Household Goods Diversified Retail Automotive Retail E-commerce FMCG - Beverage FMCG - Food (Production)

As reported by the ABS, the trend for Australia retail turnover for December 2016 (compared to December Contact us 2015) increased by 3.2%: If you would like to discuss any of the information in • Food retailing: The seasonally adjusted estimate this newsletter, please contact one of our Deals Retail for Food retailing rose 0.5% in December 2016. By and Consumer specialists: industry subgroup, the seasonally adjusted estimate rose for Supermarket and grocery stores (0.6%) and Liquor retailing (0.4%) and fell for Other specialised food retailing (-0.6%). James Gulbin • Household goods retailing: The seasonally Managing Director, adjusted estimate for household goods retailing fell Sydney 2.3% in December 2016. By industry subgroup, the seasonally adjusted estimate fell for Hardware, Tel: +61 (2) 8266 0868 building and garden supplies retailing (-6.6%), was Email: [email protected] relatively unchanged for Electrical and electronic goods retailing (0.0%) and rose for Furniture, floor coverings, houseware and textile goods retailing (0.2%). Elizabeth Fritts • Clothing, footwear and personal accessory retailing: The seasonally adjusted estimate for Director, Clothing, footwear and personal accessory retailing Sydney rose 1.4% in December 2016. By industry subgroup, the seasonally adjusted estimate rose for Clothing Tel: +61 (2) 8266 2643 retailing (1.2%) and Footwear and other personal Email: [email protected] accessory retailing (1.8%).

• Department stores: The seasonally adjusted estimate for department stores rose 0.3% in December 2016.

• Cafes, restaurants and take-away food services: The seasonally adjusted estimate for cafes, restaurants and takeaway food services rose 0.2% in December 2016. By industry subgroup, the seasonally adjusted estimate rose for Cafes, restaurants and catering services (0.3%) and was relatively unchanged for Takeaway food services (0.0%). • Other retailing: The seasonally adjusted estimate for Other retailing fell 0.2% in December 2016. By industry subgroup, the seasonally adjusted estimate fell for Other retailing n.e.c (-2.3%) and Other recreational goods retailing (-0.8%), and rose for Pharmaceutical and cosmetic and toiletry goods retailing (1.6%) and Newspaper and book retailing (3.8%).

Source: Australian Bureau of Statistics data