Annual and Sustainability Report 2013 Annual and Sustainability Report 2013 Summary GPA Message from the Board of Directors Message from the CEO Profile Corporate Structure 2013 Highlights Awards and Recognition NEXES OF TRUST Model of Management Corporate Governance Risk Management Competitive Differentials Engagement with Stakeholders BOLDNESS THat INSPIRES Business Strategy GPA Businesses Multivarejo Assaí Via Varejo Nova Pontocom GPA Malls Economic and Financial Performance Investments Capital Markets Prospects A FOCUS ON SUStainabiLitY Guidelines for Sustainability Commitments Valuing our People Conscientious Consumption and Supply Transformation in the Chain of Value Managing Environmental Impact Engagement with Society Ot HER TOOLS IN THE MENU About the Report GRI Table of Contents Ibase Social Balance Sheet Assurance Report Corporate Information 1 Annual and Sustainability Report 2013 GPA Message from the Board of Directors In 2013, GPA was able to consolidate its Message from the Board of Directors Message from the CEO strategies and achieve Profile good results in all its Corporate Structure 2013 Highlights business units. Awards and Recognition <1.1> It is with much pride that I present the of the Board of Executive Officers, results GPA achieved in 2013. With and we have a Board of Directors that resilience and discipline, and thanks supports GPA’s strategy and looks to the engagement and commitment after the interests of all stakeholders. of its team, GPA was able to cement In addition, we count on and take its strategies and obtain good results responsibility for more than 150,000 in all its businesses. motivated employees who are dedicated to the Company’s success. The year 2013 was marked by the conclusion of a cycle that began in We will remain firm in following our 1999, with the Casino Group’s first guideline of offering more competitive investment in GPA. We reiterate, prices and keeping the customer once again, our total confidence in at the center of our decisions. We Brazil, with the conviction that this will continue to take actions that is a country of great opportunities. are appreciated and recognized by This certainty translates into plans for consumers, building their loyalty to the future focused on growing GPA, our banners and reinforcing what sets and continuing its history of success us apart from the rest of the market. and our commitment to the country’s development. Thus, with a proactive stance, we will move ahead in our mission of providing GPA is the largest international the best shopping experience for our operation of the Casino Group, customers and of promoting actions which is now one of the largest retail that reflect the values that constitute companies in the world. We are our Group’s strength. committed to continuous pursuit of excellence in offering products and Jean-Charles Naouri services to our customers, supported Chairman of the Board by the skill of our professionals. It is with great satisfaction that I affirm that these results were achieved thanks to the actions of our team of coworkers, who, with determination and professionalism, made it possible for GPA to overcome the challenges. We know that 2014 will bring new challenges, but our prospects are positive. We have complete confidence in the management ability 2 Annual and Sustainability Report 2013 GPA Aware that the Message from quest for sustainable the CEO management is a long lasting journey, we will Message from the Board of Directors Message from the CEO continue investing in Profile Corporate Structure dialogue and creation 2013 Highlights Awards and Recognition of value for our stakeholders. <1.1> Even in a challenging macroeconomic practical, convenient and attractive for environment, GPA demonstrated our customers. Thus, we identified the ability and agility to adapt opportunities that allow us to act in a its strategy to the directions of coordinated fashion to offer the best the market and recorded robust buying solution, while ensuring the performance, with gains in market alignment of processes, synergistic share in the different businesses. gains, financial discipline and, consequently, lower costs. Buoyed by the communion of values with the Casino Group, and its clear Over the course of the year, business vision, the excellent results the Company also emphasized booked in 2013 reflect the evolution implementing the more competitive of our management practices and pricing strategy in Multivarejo, ongoing corporate governance, which, principally under the Extra banner. besides attesting to the determination As a consequence, we made and expertise of our professionals, is a important strides in the flow of clear demonstration of our commitment customers in stores, and gains to creating value for our stakeholders. in market share. The strategy is undergirded by the pursuit of gains in We have delivered growth with efficiency, which have been achieved positive results in recent years, through rationalizing operating and strengthening GPA as a Group poised corporate expenses. to grow sustainably and structured for the future, which is an important Investment in organic growth was differential in the retail segment. another important driver affording us important sales growth during the In 2013, we strengthened our year. GPA entered new marketplaces, multiformat model, with a diversified principally with the Assaí model; albeit converging portfolio of reinforced its presence in important businesses, and amplified our markets, such as the Northeast, competitive advantages with an with Via Varejo; and expanded the absolute focus on our customers’ proximity format with Minimercado needs. We chose, definitively, doing Extra, in the State of São Paulo. business through multiple channels as a strategic priority. Toward this Among the businesses, Assaí’s end, we developed a series of performance was one of the highlights actions with a focus on integration, of 2013. During the year, we capturing synergies and offering strengthened the new model of store creative solutions to make the and invested in organic expansion by shopping experience increasingly inaugurating 14 stores and entering 3 Annual and Sustainability Report 2013 GPA into five new states, strengthening the With more than 150,000 employees, national footprint of the banner. we are the largest private employer in Message from Brazil’s retail sector. For this reason, As a part of our strategy of generating we will maintain our commitment the CEO greater flow and attractiveness to increasing the satisfaction of our to the stores, while boosting the people, investing in perfecting their Company’s revenue from leasing potentials, so that we always have Message from the Board of Directors commercial space, GPA Malls added people that are prepared, happy and Message from the CEO approximately 45,000 m² of gross engaged with the business and its Profile leasable space, closing the period demands for growth. Corporate Structure with a total of 288,000 m². 2013 Highlights Sustainability continues to be a Awards and Recognition For Via Varejo, the year was marked strategic axis at GPA, all the more by sales growth, consolidation of so, given the size and scope of our the process of professionalizing businesses. Aware that pursuing the business, and taking actions sustainable management is a focused on pursuing efficiency long and abiding journey, we will gains. The company’s profitability continue to invest in dialogue and grew significantly as a function of the in creating value for stakeholders, measures implemented, and greater working increasingly closely with our discipline. At the end of the year, Via customers, without abandoning our Varejo effected its Public Offering environmental and social pursuits, of Shares, an important step toward while remaining aligned with the reinforcing the presence of the leading international principles we have company in the durable household signed on to, such as the United goods segment in the capital markets. Nations’ Global Compact. This Public Offering also strengthened GPA’s financial structure, contributing We are aware of our responsibilities to the reduction of the net debt and our role as a corporate citizen, position at the end of 2013. committed to maintaining balance among the economic, social and At Nova Pontocom, we adopted a environmental aspects of our activities. strategy also focused on pursuing competitiveness and growth, with Ronaldo Iabrudi gains in efficiency, market share CEO and a positive return as of the 2nd quarter. In addition, we launched Extra Marketplace, a new model of sales that brings together, on a single site, offerings from different stores, in various segments, and that has allowed us to increase the assortment of products we offer to our customers considerably. In 2013 we consolidated our multiformat model, with a diverse and convergent business portfolio, expanding our competitive advantages with absolute focus on the needs of our clients. 4 Annual and Sustainability Report 2013 GPA Profile Message from the Board of Directors Message from the CEO Profile Corporate Structure 2013 Highlights Awards and Recognition A leader in the retail segment in Business units 2.8 million Brazil, with gross revenue of R$64.4 <2.2, 2.3 and 2.7> SqUARE METERS billion in 2013, GPA is an enterprise in the Casino Group, one of the largest Multivarejo OF SALES AREA global retailers.1 <2.1 and 2.8> Which operates the supermarket, hypermarket, minimarket, fuel stations and Founded in 1948, in São Paulo, drugstore formats with the Pão de Açúcar and it maintains its administrative Extra brands. headquarters in São Paulo and is active in 19 Brazilian states and in Assaí 659 the Federal District. The Company Active in the self-service wholesale segment. closed the year with 170 thousands employees, 1,999 points of sale Via Varejo million with an aggregate of 2.8 million With bricks-and-mortar stores for durable OF TICKETS PER THE YEAR square meters of sales floor, 659 household goods under the Casas Bahia and million check-outs and a logistics Pontofrio banners.