European Retail Briefing - February 2014

ANALYST COMMENT
 GERMAN SHOPPERS’ ENTHUSIASM FOR PUREPLAYS
German demand for pureplay shopping
What’s driving Germans to online-only retailers?
Amazon popular in Germany
Figure 1: Germany: The consumer: Proportion of respondents buying from Amazon in the last 12 months, August 2013 and January 2014
Figure 2: UK: The consumer: Proportion of respondents buying from Amazon in the last 12 months, November 2013 and July 2013
Other online-only retailers fulfil demand
What it means
EUROPEAN RETAIL SALES
Key points
Retail sales
Figure 3: Major European economies: Year-on-year retail sales value growth, 2012-13
Figure 4: Major European economies: Year-on-year retail sales volume growth, 2012-13
Inflation
Figure 5: Major European economies: All items CPI, 2013
Figure 6: Major European economies: Food price inflation, 2013
HEADLINES FOR THE MONTH
Grocers
Mixed goods retailing
Multi-sector retailing
Department stores
Electrical retailing
Home shopping
Economy
NEWS ANALYSIS – FOOD AND DRINK
 BAKERS
UK: Greggs cuts staff after sales growth
 CO-OPS
UK: Co-op
…begins flash sale of food essentials
…launches 2014 saving stamps campaign
 CONVENIENCE STORES
UK: McColl’s
…reports strong Christmas sales
…flotation confirmed
UK: One Stop completes refurbishment of Alfred Jones
 GROCERS
Belgium: Delhaize Group posts solid preliminary results
Belgium: Colruyt share price drops to seven-month low
Europe: Carrefour posts Q4 and FY results
Europe: Cora sees sales increase
Europe: Eroski announces plans for 100 new stores
France: Auchan’s
…eastern expansion cleared by authorities
…to reorganise following poor performance
Germany: Coca-Cola products removed from German Lidl stores
Germany: Lidl to re-stock Coca-Cola from March 2014
Netherlands: Sligro profits fall
Russian Federation: Lenta planning an IPO on London Stock Exchange
Russian Federation: Magnit and O’Key report strong results
UK: Asda
…accused of raising prices before January rollback
…believed to be lining up bid for Early Learning Centre
…to push George brand into homewares
UK: Fortnum & Mason reports strong festive sales
UK: Lidl
…looking for new, larger UK headquarters
…trialling self-checkouts in the UK
UK: Morrisons
…online executive quits after weeks in the role
…treasurer arrested for insider deal
UK: Sainsbury’s announces departure of CEO
UK: Tesco
…and Waitrose to open tube station collection points
…reportedly sizes up bid for Mothercare
 SPECIALIST FOOD RETAILERS
UK: Thorntons posts Q2 sales rise
UK: Hotel Chocolat revives stake sale process
 OFF-LICENCES
UK: Conviviality Retail first half like-for-likes up
NEWS ANALYSIS – NON-FOOD
 CLOTHING RETAILING
Europe: French Connection Group releases trading update
France: Kiabi grows ahead of the market
UK: Blue Inc
…Christmas sales rise
…considering flotation on stock market
UK: Bonmarche posts positive like-for-likes
UK: Burberry
…appoints BSkyB CEO as non-executive director
…Christmas sales driven by online
UK: Fat Face
…positive after Christmas trading
…preparing for stock market flotation
UK: H&M produces flat revenues
UK: Jaeger reports Christmas sales jump
UK: Karen Millen like-for-likes rise over Christmas
UK: Laura Ashley pays shareholder dividend
UK: Matalan sales up as EBITDA falls
UK: Monsoon Accessorize posts pre-tax profit for 2013
UK: Moss Bros set to beat profit forecast
UK: Primark Christmas sales up 12%
UK: Reiss produces turnaround Christmas figures
UK: SuperGroup announces sales are on “on track”
UK: Topshopto launch stores in New York
UK: White Stuff enjoys successful Christmas
 FOOTWEAR RETAILING
UK: Shoe Zone claims value retailers can profit online
UK: Electra to buy shoe chain Hotter
 MIXED GOODS RETAILING
Spain: Poundland set to open 10 stores in Spain
UK: KPMG resigned as Poundworld auditor due to "misleading" results
UK: Poundworld to partner etailer Poundshop.com
 MULTI-SECTOR RETAILING
Germany: Metro Group Q1 sales edge up
Germany: Metro plans partial IPO of Russian business
Germany: Real plans to cut store numbers
UK: Argos
…to encourage app downloads with in-store NFC
…and Homebase put pressure on suppliers
UK: Home Retail Group
…releases Interim Management Statement
…reportedly to name Walden as new CEO
UK: Marks & Spencer
…hires Inditex employees to boost overseas trade
…prepares for Australian launch
 DEPARTMENT STORES
Germany: Karstadt expected to make a loss in 2014
UK: House of Fraser
…pushing for listing
…to roll out queue-beating technology
UK: John Lewis
…sees strong Christmas and New Year sales growth
…to sponsor Commonwealth Games
…bans angora wool
…reports strong weekly sales
…sees full year sales rise
UK: Selfridges Christmas sales soar
 DIY RETAILING
UK: B&Q hires former Matalan boss
UK: Topps Tiles opens boutique store
 ELECTRICAL RETAILING
Europe: Carphone Warehouse to operate Samsung stores
Europe: Darty announces improved performance in third quarter
UK: BC considers potential float of Phones4U
UK: Carphone Warehouse like-for-likes climb over Christmas
UK: Dixons reports on “lively” Christmas
 MUSIC AND VIDEO GOODS RETAILING
UK: Game
…sees like-for-likes rocket at Christmas
…enter courtroom battle with UK’s largest landlord consortium
UK: HMV closes Oxford Street flagship
 CARPET RETAILING
UK: Carpetright issues profit warning
UK: United Carpets and Floors 2 Go change prices after OFT probe
 FURNITURE RETAILING
UK: DFS and B&M advance flotation plans
UK: Endless plots sale of Bathstore
UK: IKEA
…announces sales growth
…sales surge
 HOME SHOPPING
Germany: eBay Germany sees strong sales growth
UK: Able & Cole sees sales rise
UK: Amazon to deliver on Sundays
UK: Ao.com
…announces flotation plans
…seeks £1.2bn IPO valuation
UK: Asos sees Christmas sales surge
UK: Findel to deliver “strong profit growth”
UK: MandM Direct experiences late sales surge
UK: Mothercare signs up to eBay partnership
UK: My-Wardrobe hires new recruits as part of turnaround programme.
UK: N Brown sees revenues rise
UK: Ocado
…post pre-tax loss for 2013
…sales rise over the fourth-quarter
UK: Sales growth slows for Amazon UK
UK: Shop Direct posts Christmas sales rise
 HEALTH AND BEAUTY RETAILING
UK: Superdrug
…considers UK headquarters to support London IPO
…sees rise in like-for-likes over Christmas
UK: The Perfume Shop announces strong Christmas trading
 BOOK AND STATIONERY RETAILING
UK: Foyles like-for-likes edge up
UK: Waterstones reduces full-year losses
UK: WHSmith
…extends contract with distribution company
…like-for-likes down but profit solid
 SPORTS AND LEISURE GOODS RETAILING
UK: Adidas to open digital store in Bluewater
UK: JD Sports
…records improvement in like-for-likes
…to launch value chain Open
UK: Sports Direct
…acquires stake in Debenhams
…and Debenhams meet to explore option
…stake in Debenhams
 GARDEN CENTRES
UK: L-Gam acquires Jardiland
 TOYS AND GAMES RETAILING
UK: Mothercare in talks to sell Early Learning Centre
 MISCELLANEOUS SPECIALIST RETAILING
UK: Albemarle & Bond calls off sale
UK: Alfred Dunhill owner forced to inject cash into business
UK: Halfords sales up 7%
 ECONOMY
Germany: German retail sales dip by 2.4%
UK: BRC
…sales monitor shows "respectable" Christmas trading
…key export markets show huge growth in UK retailer searches
…UK retailers cut prices for ninth consecutive month
UK: ONS confirms strong retail growth in December
UK: Shop vacancies at lowest level for four years
UK: The City gives green light to retailer IPO’s
ELECTRICAL GOODS RETAILING – EUROPE
 AMAZON EUROPE
What we think
Figure 7: The consumer: Percentage of respondents having bought electrical goods from Amazon in the past 12 months, November 2013
Company background
Company performance
Figure 8: Amazon Europe: Group sales performance, excl. sales tax, 2008-13
Retail offering
Figure 9: Number of products listed on Amazon.co.uk, by category, December 2013
Figure 10: Amazon.co.uk: Product mix, by number of SKUs, December 2013