Preliminary Results 2004/05
Board
§ In 2004/05 strengthened and renewed plc Board § Non-exec appointments - Gary Hughes expected successor as Chairman of Audit Committee - Bob Stack as Chairman of Remuneration Committee § Darren Shapland joins on 1 August 2005 as chief financial officer § Reviewed, challenged and agreed plans for sales-led recovery § On track for delivering plan
Philip Hampton
Chairman
PHILIP HAMPTON Page 1
PHILIP HAMPTON Page 2
2005 share plan
Dividend
§ Announced 24 March 2005 after shareholder consultation § Over 1,000 colleagues from Board down to supermarket store manager § Aligns interest of management and shareholders § Performance metrics are sales and eps growth supporting sales led recovery § Subject to shareholder approval at AGM on 13th July 2005
§ No change from that announced on 19 October 2004 § Total dividend of 7.8p for 2004/05 § Recommended final dividend 5.65p § Medium term objective to restore cover to at least 1.5 times
PHILIP HAMPTON Page 3
PHILIP HAMPTON Page 4
Group performance
§ Year of major change and transition § Sale of Shaw’s Supermarkets - profit on disposal of £275m (1) - return of capital 35p per share § Investment in customer offer in the UK § Business Review exceptionals - £510m in 2004/05
Roger Matthews
Finance Director
(1)
By way of a ‘B share’ scheme
ROGER MATTHEWS Page 1
ROGER MATTHEWS Page 2
Group performance
Sainsbury’s Supermarkets
Underlying operating performance
2004/05 £m Sales (inc VAT) - continuing operations Underlying operating profit - continuing operations Underlying profit before tax Profit before tax Profit after tax Underlying EPS
(1) (2) (1)
2003/04 £m 15,517 590 675 610 404 23.4p Sales (inc VAT) Underlying operating profit
(2)
16,364 334 254 15 65 9.0p
2004/05 £m 16,076 321 2.0
2003/04 £m 15,297 564 3.7
LFL growth (%)
(1)
(0.4)
Underlying operating margin % (VAT inclusive)
§ Accelerated investment in customer offer § Higher operating costs - wastage, supply chain, instore labour
(1)
Before amortisation of goodwill £(5)m 2003/04: £(11)m and exceptional items £(234)m (2003/04: £(54)m) Before non equity dividend
(1)
(2)
Underlying tax rate 36.2% (2003/04 - 32.4%: credit of £50m (2003/04: charge of £206m)
LFL growth is excluding petrol and Easter adjusted, as reported on 24 March 2005. See Appendix for details Underlying is before exceptional costs and amortisation of goodwill
(2)
ROGER MATTHEWS Page 3
ROGER MATTHEWS Page 4
Sainsbury’s Bank
Exceptional items
§ Continuing to grow customers and income - net income £192m - customer accounts c.2.3m - personal loan balances £1.5 billion - credit card balances £0.9 billion - commission income £109m § Profit delivery below plan, down 50% to £13m § Lower income growth § Higher than expected asset growth
24% 23% 23% 48% 34%
2004/05 £m Exceptional operating costs Business Transformation Business Review costs Safeway bid costs Exceptional operating costs Non operating exceptionals Property profits (1) Disposal of operations Shaw’s Supermarkets Other discontinued operations Non-operating exceptional items (22) (485) (507)
2003/04 £m (59) (9) (68)
§ Bad debt charge reflects high asset growth and prudent provisions - total bad debt charge is 2.8% (2004 of 1.9%) of average unsecured lending balances § Lending criteria tightened in 2004
2004/05 £m Net income Operating costs Provision of bad debts Operating profit 192 (115) (64) 13 2003/04 £m 155 (100) (29) 26 Change % 24 15 121 50
21 275 (23) 273 (234)
17 (3) 14 (54)
Total exceptional items
§ Total Business Review exceptionals estimated at £560m § £510m charged in 2004/05 - £485m in exceptional operating costs - £25m property writedowns (1) § Estimated £50m to be incurred in 2005/06
(1)
Includes Business Review property writedowns of £25m See Appendix for details of Business Review exceptionals
ROGER MATTHEWS Page 5
ROGER MATTHEWS Page 6
Capital expenditure
Cash flow
Reported net debt
§ 2004/05 Group capital expenditure of £797m (2003/04: £838m) Sainsbury’s Supermarkets capital expenditure (1)
£m 1,200 1000 800 600 400 200 0
(1) (2) (2)
§ Reported net debt reduced by £640m to £1,397m § Sainsbury’s Bank change in presentation of assets and liabilities - now consolidated line by line - no impact on Group net assets § Sainsbury’s Bank’s net cash at March 2005 was £76m (2004: £51m)
(1)
Supply chain Refurbishments and extensions New stores Other
(1)
Including loan from minority shareholder
2000/01
2001/02
2002/03
2003/04
2004/05
2005/06
Excludes acquisition and purchase of stores in 2004/05 2005/06 capital expenditure estimated at £550m
ROGER MATTHEWS Page 7
ROGER MATTHEWS Page 8
Cash flow before Sainsbury’s Bank representation
Free cash flow before corporate activities
§ Improved working capital of £321m in operating cash flow
Cash flow before Sainsbury’s Bank representation
Corporate activities
2004/05 £m Disposal of Shaw’s /JSD 1,373 (659) (313) (101) (46) 254 615 (1,473) 34% £1.6bn - £1.7bn
(1)
2003/04 £m 185 (23) (501) 28 (311) (684) (2,088) 40%
2004/05 £m Operating cash flows Net interest Taxation Equity dividends Payment for fixed assets Sale of fixed assets Purchase of intangibles Free cash flow 911 (80) (71) (254) (407) 266 (4) 361
2003/04 £m 847 (88) (183) (300) (801) 152 (373)
Capital return Purchase of Safeway stores Convenience acquisitions Acquisition of Swan Other Retained proceeds from sale of Shaw’s Movements in net debt Net debt (excluding Sainsbury’s Bank) Gearing Adjusting for timing benefits on net debt
Timing benefits arise from - Easter - cash exceptional of £80m now in 2005/06
(1)
Excluding Sainsbury’s Bank
ROGER MATTHEWS Page 9
ROGER MATTHEWS Page 10
For your models - 2005/06
Financial summary
§ Sainsbury’s Supermarkets - focus on sales growth - cost savings reinvested in customer offer - operational gearing in second half of 2006/07 § Sainsbury’s Bank - modest improvement in profitability § Cash flow - capital expenditure of £550m - aim to be cash flow neutral based on adjusted net debt
§ Results impacted by - sale of Shaw’s - investment in customer offer - Business Review exceptionals § Significant improvement in free cash flow before corporate activities and net debt reduced § Strong balance sheet - valuable property portfolio
ROGER MATTHEWS Page 11
ROGER MATTHEWS Page 12
A year of change
§ Review and quick wins, first six months § Business Review announced, 19 October 2004 - new management team - restoring universal appeal - fixing the basics - sales-led recovery § Early signs of improvement - on track to deliver sales-led recovery
Justin King
Chief Executive
JUSTIN KING Page 1
JUSTIN KING Page 2
Early signs of improvement
Quarterly sales growth
(1)
Operating Board
New management team
% 6 5 4 3 2 1 0 -1 -2
(2)
Total LfL LfL inflation/(deflation)
§ New operating board - Gwyn Burr (Customer Service) - Lawrence Christensen (Supply Chain) - Mike Coupe (Trading) - Jim McCarthy (Convenience) - Ken McMeikan (Retail) - Darren Shapland joins as CFO on 1 August 2005 § Outstanding retail experience and track record of delivery
Justin King (1) Chief Executive Q1 Q2 2004/05 Q3 Q4
Customer Service
Gwyn Burr Joined Aug 2004
Retail
Ken McMeikan Joined Feb 2005
Marketing
Stephen Nelson (3) Joined July 2003
Change
Hamish Elvidge Joined Jan 1980
Supply Chain
Lawrence Christensen Joined Sept 2004
Company Secretariat
Tim Fallowfield Joined Oct 2001
(1) (2)
All figures excluding petrol Q4 was reported as 11 weeks actual and 1 week estimated See Appendix for details
Convenience Trading
Jim McCarthy Joined Jun 2004 Mike Coupe Joined Oct 2004
Finance
(1)
HR
Imelda Walsh Joined Oct 2001
Bank
Roger Matthews (2) Joined Nov 1999
Tim Pile Joined Jan 2002
(1)
Executive Director Leaves in June. Darren Shapland will replace on 1 August 2005 (3) Announced will be leaving in Summer 2005
(2)
See Appendix for further details
JUSTIN KING Page 3
JUSTIN KING Page 4
New senior management team
Restoring universal appeal
Great food at fair prices
§ 40% change amongst senior management population § 40% of divisional directors are women § Recruited from competitors and complementary sectors § Internal development § Confirms attraction of brand
§ Significant investment in price since January 2004 - 7,000 prices lower - customers noticing the difference § Investment in quality and innovation - relaunched ‘Taste the Difference’ - c.900 lines - relaunched entry level range as ‘Basics’ - c.400 lines - ‘good’, ‘better’, ‘best’ – clear category hierarchy - conducting category reviews and building supplier business plans - clear product labelling - ‘Wheel of Health’
See Appendix for further details
See Appendix for further details on Wheel of Health
JUSTIN KING Page 5
JUSTIN KING Page 6
Active Kids
Restoring universal appeal
Complementary non food
§ From 2 March 2005 until 30 June 2005 § One voucher per £10 spent § Bonus voucher for fruit and vegetables § 23,500 schools registered § Vouchers redeemed in July, equipment delivered in September § Kelly Holmes is our ambassador
§ Successfully traded out of surplus stock position § Making existing space work harder without disrupting stores § Focus on non core food, news, magazines, cards and wrap, music and dvd’s § Clothing and home contribute in years 2 and 3 of plan § Launch of TU, now in 170 stores § Plan to deliver £700m incremental sales by end of 2007/08
JUSTIN KING Page 7
JUSTIN KING Page 8
Restoring universal appeal
Convenience
Restoring universal appeal
Sainsbury’s to You
§ Established separate management team § Developed customer proposition § Acquired 3 convenience estates, with 125 stores
(1)
§ Expansion remains on hold § Important for customers § Focussed on improving customer service § 600 drivers rejoined business § Website improvements reduced shopping time by 50% for first orders § Availability improved by 4.5 percentage points
(1)
§ Good progress on conversions - 15 stores trading as ‘Sainsbury’s at’ - volumes increased by 25% § Rebranding and refurbishment in 2005/06 affecting over 100 stores § Restructuring Bells and Jacksons head offices § Growth through acquisition and organic opportunities - £400m additional sales by end of 2007/08
(1)
Measured year on year as at March 2005
(1)
114 Jacksons stores, 6 Beaumont stores and 5 Shaw stores (in April 2005) Announced 12 convenience closures on 19 October 2004, 9 closed, 2 to close shortly and Fenchurch Street to stay open
JUSTIN KING Page 9
JUSTIN KING Page 10
Restoring universal appeal
Sainsbury's Bank
Fixing the basics
In store availability
§ Profit below plan in 2004/05 § Announced restructuring plans - reducing in store sales force - simplifying central support team § Relaunch of car insurance § Challenging target of £90m by end of 2007/08
§ Comprehensive review § Steady improvement in forecast and inventory accuracy - physical stock count § Improved in-store processes - 75% of out of stocks resolvable in stores - effective use of night shift - rollout to all stores complete by summer 2005 § Priority to serve customers
JUSTIN KING Page 11
JUSTIN KING Page 12
Fixing the basics
Supply chain
Fixing the basics
IT systems
§ Automated depot performance - close to design capacity, although at extra cost § Network improvements - 24 hour turnaround of store orders - retail support teams § Focus on - consistent performance - reducing wastage - improving efficiency of operations and transport - understanding full capability § Priority to serve stores
§ Constructive dialogue with Accenture - negotiation process ongoing § Angela Morrison joined in March 2005 § Stabilising systems and developing simple good value solutions § Increasing internal capability
JUSTIN KING Page 13
JUSTIN KING Page 14
Fixing the basics
Organisation and people
Fixing the basics
Supermarket store estate
§ 3,000 additional in-store colleagues § Business Centre aligned to support store colleagues § 7,000 ‘Tell Justin’ suggestions from colleagues § Increased investment in training to 3.6m hours § 10,000 store staff over 50 years of age to be recruited § 90,000 colleagues will receive bonuses
§ 465 supermarkets § 14 stores from Morrisons - successfully converted - opportunities to improve performance § 4 new stores opened during the year § Around 30% of 131 underinvested stores to be refurbished in 2005/06
(1)
(1)
13 Safeway branded stores and 1 Morrisons store
JUSTIN KING Page 15
JUSTIN KING Page 16
Making Sainsbury’s Great Again
Appendices
§ Customers beginning to notice difference § Priority to continue to invest in customer offer - price and quality § Maintain improvements while continuing longer term change § Tough retail conditions § Encouraging early progress
JUSTIN KING Page 17
Corporate responsibility
Business Review metrics
Dow Jones Sustainability Index Ranked best in sector for last three years
Description Sales growth Grocery Non-food Convenience
2004/05 £m
2005/06 £m
2006/07 £m
2007/08 £m 1400 700 400 2500
}
market matching by year end
FTSE4 Good Index Included
Customer offer investment Buying efficiencies Bank profit Operating cost savings Supply chain IT systems Stock loss Store operations Marketing Central Other Cumulative total 100 100-150bp
investing at least 100-150bp
400 100-150bp 90
Global 100 One of top 100 sustainable corporations
250
50 40 120 70 40 60 20 400
Business in the Community Corporate Responsibility Index Ranked first in food retailing for second year
Exceptional items (updated) IT assets Employee related Stock Supply chain assets Property Other
145 41 90 119 100 15 510
40
10 50 550 550 at least 75 positive 450 at least 75 positive
Corporate Responsibility Exchange Index Participating in The London Stock Exchange’s Corporate Responsibility Exchange
CAPEX Asset and store development proceeds at least 225
at least 75 neutral
Cash flow (before corporate activites)
APPENDIX Page 1
APPENDIX Page 2
Sainsbury’s organisation
Chief Executive Justin King
Market share by region
Bank Tim Pile
Trading Director Mike Coupe
Core Grocery Amanda Heffer Impulse Grocery Laurence Clube Dairy & Convenience Simon Twigger Fresh Foods Karen Schenstrom GM Penny Teale Clothing Richard Jones Central Support Mike Attwood GNFR John Green
HR Director Imelda Walsh
Retail HR Liz Reilly Convenience HR Helen Rendell Business Centre HR Sarah Bullock/ Graeme Wylie Supply Chain HR Jim White Policy & Reward Margaret Solosy Resourcing & Development Margaret Edge Organisation Development Diana Breeze Health & Safety Neil Lennox
Retail Director Ken McMeikan
Central Retail Ops Robin Lassiter Zone Managing Directors Jon Hartland Ralph Llanwarne Kevin Plant Andy Sapey Dean Clegg Retail Change Bob Hetherington
Finance Director Roger (1) Matthews
Finance Operations Hannah Bernard Financial Planning & Reporting Ian Kenyon Retail Finance Matthew Price Trading Finance Jonny Mason Corporate Finance Jeremy Townsend(2) Investor Relations Lynda Ashton Internal Audit Richard Chadwick Company Secretary Tim Fallowfield Property TBC
Scotland 3.6 North East 1.6 Lancashire 6.6 Yorkshire 5.5 Wales Midlands E England & West 7.7 15.3 6.0 London 36.5 South West South 13.7 3.4
Finance Jim Kinloch Business Development Jonathan Hewitt Marketing Kate Harrison IT Kevin Barrett Banking and Customer Service John McGregor Retail Mark Solomons Deputy CEO Derek Bottom
Total market share 10.4%
For 52 weeks to 27 March 2005
Change Director Hamish Elvidge
IT Angela Morrison Back Office Productivity Jason Kane-Rawlings Programme Director Linda Ashman Business Continuity Steve Mellish
Supply Chain Director Lawrence Christensen
Central Supply Chain Ops Diane Carter Central Transport Ian Prest Technical Dave Timson SC Optimisation Tim Goalen Logistics North Mike Sturt Logistics South Dave King Security Sarah Frain
Marketing Director Stephen Nelson (2)
Commercial Planning David Ellis Brand Comms Helen Buck Customer Insights & Segmentation Jeremy Garlick Sainsbury’s Brand Judith Batchelar Store Brand & Events Louise English On Line Toby Anderson Public Affairs Erica Zimmer Communications Pip Wood
Customer Services Director Gwyn Burr
Internal Comms Eleanor Johnson Customer Service Centre Sarah Trowbridge (covering) Service Proposition Sarah Trowbridge
Convenience Director Jim McCarthy
Locals Jonathan Lawson Convenience Trading/ Marketing Richard Lancaster Convenience Property Elizabeth Abrahams Jacksons and Bells Angus Oughtred Beaumonts Louise Beaumont Finance Director Nick Hatley Announced will be leaving. Darren Shapland from 1 August 2005 (2) Announced will be leaving
(1)
Total market
Spend (£000's) London Midlands North East Yorkshire Lancashire South Scotland E.England Wales & West S.West Total Source: TNS 23,279,530 16,656,310 5,286,011 10,503,370 12,564,130 11,532,050 11,535,000 7,918,001 9,081,014 3,498,107 111,853,523 Share of total region 20.8 14.9 4.7 9.4 11.2 10.3 10.3 7.1 8.1 3.1 100
Total Sainsbury
Spend (£000's) 4,262,052 1,781,645 190,292 643,773 774,715 1,602,618 418,518 900,803 698,763 391,979 11,665,158 % of SSL 36.5 15.3 1.6 5.5 6.6 13.7 3.6 7.7 6.0 3.4 100 SSL share of total market (%) 18.3 10.7 3.6 6.1 6.2 13.9 3.6 11.4 7.7 11.2 10.4
APPENDIX Page 3
APPENDIX Page 4
Product labelling
Supplementary financial details
The Wheel of Health Need to provide customers with honest, accurate and easy to read labelling The Wheel of Health appears on front of pack labelling, featuring five key nutrients that are colour coded, red, orange or green The contribution of 5 nutrients to the guideline daily amounts is shown Launched initially on 30 products, with plans to roll out across all categories
1. Preliminary Results 52 weeks to 26 March 2005 Summary profit and loss account
2004/05 £m Sales Continuing operations Discontinued operations VAT and sales tax Operating profit Continuing operations Discontinued operations Share of profit in JV Net interest payable Amortisation of goodwill Exceptional items Profit before tax Taxation Profit after tax Equity minority interests Profit for the financial period Dividends relating to return of capital Equity dividends Retained (loss) /profit for the financial period
(1)
2003/04 £m 14,440 2,701 1,098 18,239 590 145 735 (60) 675 (11) (54) 610 (206) 404 (8) 396 (301) 95
15,202 207 1,164 16,573 334 11 345 1 (92) 254 (5) (234) 15 50 65 (4) 61 (113) (131) (183)
(2)
(1) (2)
Before exceptional items and amortisation of goodwill Relating to the amount of return of capital which shareholders took as dividends
APPENDIX Page 5
APPENDIX Page 6
Supplementary financial details
Supplementary financial details
2. Sainsbury’s Supermarkets
2004/05 £m Sales (inc VAT) Sales (ex VAT) Underlying operating margin VAT inclusive VAT exclusive 2.0% 2.2% 3.7% 4.0% 16,076 14,914 2003/04 £m 15,297 14,220
5. Dividend
2004/05 Interim Final Total Dividend cover - post exceptionals - pre exceptionals Payout ratio - post exceptionals - pre exceptionals 2.15 5.65 7.80
(1)
2003/04 4.33 11.36 15.69
0.45x 1.17x 87% 86%
1.32x 1.49x 76% 69%
3. Interest
2004/05 £m Interest receivable Interest payable Capitalised interest Net interest payable 35 (132) 5 (92) 2003/04 £m 25 (111) 26 (60)
(1)
Expected total dividend for the year
Dividend cover is calculated by dividing the profit for the financial year by equity dividends. The payout ratio is the inverse. The final dividend dates: Ordinary shares Ex dividend 25 May 2005 Record 27 May 2005 Payment 20 July 2005
ADRs 25 May 2005 27 May 2005 27 July 2005
6. Share plan
4. Average weighted number of shares for 2004/05 was 1,749.9 (and 1,756.6 diluted) and is estimated to be 1,700m for 2005/06
§ Base year numbers 2004/05 (1) - sales £13,588m (2) - eps 8.6p per share
(1) (2)
Sales are excluding petrol and Sainsbury’s Bank UK GAAP underlying EPS after adjusting for share based payments under IFRS 2
APPENDIX Page 7
APPENDIX Page 8
Supplementary financial details
Supplementary financial details
9. Group cash flow
7. Capital expenditure
2004/05 £m Sainsbury’s Supermarkets Store acquisitions Sainsbury’s Bank Other Total Group 457 313 16 11 797 2003/04 £m 572 18 248 838
Operating cash inflows
2005/06 £m 936
2004/05 £m 869 (88) (183) (300) (801) (187) 152 (538) (538) 129 (409) 16 4 (273) (662) (2,037)
8. Business Review exceptionals
Latest Estimate £m IT systems Employee-related Stock Supply Chain Property Other Operating exceptionals Property write-downs Total 145 81 90 119 75 25 535 25 560 Business Review £m 145 90 77 119 73 21 525 25 550 Change £m 9 (13) (2) (4) (10) (10) Charged in 2004/05 £m 145 41 90 119 75 15 485 25 510
(80) Group net interest and dividends from joint venture (71) Taxation (254) Equity dividends (407) Payments for fixed assets Purchase of IT assets 266 Sale of fixed assets (4) Payments for intangible fixed assets 386 Free cash flow before corporate activities (113) Non-equity dividends (313) Purchase of stores (40) Cash outflow before sale and purchase of businesses 1,018 Acquisitions and disposals 978 Net cash outflow before financing Issue of ordinary share capital Capital redeemed Capital redemption expenses Sainsbury’s Bank shareholder investments Non cash movements Movement in net debt Net debt 5 (547) (2) 206 640 (1,397)
10. Investment grade credit rating
Credit ratings Long term Moody’s S&P Fitch BBBBaa3 BBB Outlook negative negative negative Short term A-3 P-3 F3
§ £50m to be incurred in 2005/06
APPENDIX Page 9
APPENDIX Page 10
Supplementary financial details
Supplementary financial details
11. Pensions update
§ 2003 actuarial valuation deficit of £161m § UK pension contribution up £13m to £92m (2003/04: £79m) § UK FRS 17 deficit (net of deferred tax asset) £346m (2003/04:£441m)
14. IFRS
§ Initial indication of IFRS impact given on 26 April 2005
(1)
§ No effect on the underlying operations - just accounting adjustments § IFRS may increase volatility of reported profits - particularly in relation to pensions and financial instruments § Underlying profit in 2004/05 reduced by between £0 - £10m
(2) (3)
12. Tax rate
§ Underlying tax rate of 36.2% (2003/04: 32.4%) § Tax credit of £50m in 2004/05 due to exceptional costs § Underlying tax rate expected to be 36% in 2005/06
§ Reduction of around 7% to net assets at March 2004 - predominately from pensions § No impact on cash flow § IFRS has no effect on Business Review plans outlined on 19 October 2004 § Restated UK balance sheet and income statement for full year 2004/05 to be announced on 16 June 2005
13. 2004/05 sales growth
% Including petrol - Total - LfL - LfL inflation / (deflation) Excluding petrol - Total - LfL - LfL inflation / (deflation) 0.8 (0.6) 0.2 1.5 (1.1) (1.1) 1.3 (0.9) (0.5) 2.7 (1.2) (1.2) 5.4 1.7 (1.6) 4.0 0.2 (1.4) 2.6 (0.4) (1.0) Q1 2.3 1.0 0.5 Q2 4.4 1.8 (0.5) H1 3.5 1.5 (0.1) Q3 6.1 2.4 (0.8) Q4e 7.2 3.7 (1.2) H2e 6.6 3.0 (1.0) FYe 5.0 2.2 (0.5)
(1)
Please refer to the website for the full presentation and transcript www.j-sainsbury.co.uk Before exceptional items and amortisation of goodwill as reported under UK GAAP All numbers are estimates and unaudited
(2)
(3)
e = estimated Q4 11 weeks actual sales and 1 week estimated
APPENDIX Page 11
APPENDIX Page 12
Store estate
Number of stores Refurbishments Brought forward 2000/01 2001/02 2002/03 2003/04 2004/05 Total Further refurbishment To complete Expected total portfolio at March 2005
(1)
Sales area and store numbers
2005/06
estimated Area (‘000 sq ft) Number 15,799 120 (112) 8 105 15,912 465 4 (5) (1) [40] 464
Extensions 34 27 29 14 7 111
Total 50 117 69 16 12 264 (13) 122
(3)
New stores 34 27 25 39(1) 85 144 354
(2)
Total 34 77 142 108 101 156 618 122 (13)
(3) (4)
2004/05
Area (‘000 sq ft) Supermarkets Opening figures New stores Closures Net new added Extensions / refurbishments Closing figures 15,231 539 (33) 506 62 15,799 Number 447 20 (2) 18 [12] 465
16 90 40 2 5 153
153
111
373
354
727
Area (‘000 sq ft) Convenience Opening figures New stores Closures Net new added Extensions / refurbishments Closing figures 339 266 (34) 232
Number 136 136 (10) 126 [17] 262
Area (‘000 sq ft) 571 162 (6) 156 727
Number 262 54 (2) 52 [117] 314
Includes 6 Kiosks upgraded to Locals and net of closures and including 54 Bell stores (2) Net of 5 closures, but includes Jackson’s and stores purchased from Morrisons and Sommerfield
(3) (4)
Stores included above requiring further refurbishment Comprises 131 to complete as at 19 October comprises less 9 refurbished since then
Over 40,000 sq ft Convenience Supermarkets Total stores
(1) (2)
25,000 to 40,000 sq ft (1)
15,000 to 25,000 sq ft 79 79
Under 15,000 sq ft 262 52 314
Total 262 (1) 465 727
571
158 158
176 176
Area (‘000 sq ft) Total stores Opening figures New stores Closures Net new added Extensions / refurbishments Closing figures 15,570 805 (67) 738 62 16,370
Number 583 156 (12) 144 [29] 727
Area (‘000 sq ft)
Number
Includes 24 stores over 55,000 sq ft Before acquisition of 5 stores from SL Shaw Ltd in April 2005
727 16,370 282 58 (11) (118) 47 164 105 [157] 16,639 774
APPENDIX Page 13
APPENDIX Page 14
Net new space for 2004/05
Date
Supermarkets Selsdon Bridgnorth Scunthorpe* Tadcaster* Chafford Hundred* Mansfield* Cranleigh Stockton, Whitehouse Farm* Cramlington* Lytham St Annes* Grantham* Spalding* Scarborough* Darlington* Newcastle-upon-Tyne, Heaton* Ripon* Didcot Gateshead, Team Valley* Guisborough Southampton, Shirley Convenience Moorcroft Shell Putney Shell Muswell Hill Shell Bellegrove Shell Clapton Shell Buckskin Shell Watford Sceptre Shell Woodlands Shell Levenshulme Shell Staincliff, Dewsbury Jacksons Sunnyside, Jacksons Couden, Bells Clapham Local Willesden Green Local Fortis Road Local Farnley, Jacksons Total Jun 04 Jun 04 Jul 04 Aug 04 Aug 04 Aug 04 Sept 04 Sept 04 Sept 04 Sept 04 Sept 04 Sept 04 Sept 04 Sept 04 Oct 04 Oct 04 Oct 04 Feb 05 Mar 05 Mar 05
(1)
Broker forecasts
Y/e 2004/05 Y/e 2005/06 Y/e 2006/07 PBT DPS PBT DPS (£m) (p) (£m) (p) 265 7.8p 280 7.8p 348 10.6p 260 7.8p 273 267 257 278 273 225 249 340 329 296 295 290 326 290 279 246 225 285 224 275 284 297 280 346 321 285 283 224 348 7.8p 7.8p 7.8p 7.8p 8.3p 7.8p 7.8p 8.7p 9.0p 8.0p 7.8p 7.8p 7.8p 7.8p 7.8p 7.8p 7.8p 7.8p 5.0p 7.8p 7.8p 8.4p 7.8p 7.8p 7.8p 7.8p 7.8p 5.0p 9.0p 348 312 397 308 321 306 316 320 342 359 414 433 394 427 370 342 353 384 340 265 345 410 400 497 375 7.8p 8.6p 8.2p 7.8p 10.0p 7.8p 7.8p 9.1p 8.6p 9.0p 10.7p 10.3p 9.5p 7.8p 7.8p 8.0p 8.6p 9.1p 8.0p 5.7p 9.0p 9.6p 8.3p 7.8p 7.8p
Total sales area (sq ft)
24,000 16,000 31,000 10,000 30,000 29,000 15,000 26,000 31,000 20,000 30,000 28,000 32,000 38,000 33,000 22,000 44,000 37,400 14,800 28,000 539,200 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 2,000 1,000 2,000 2,000 3,000 2,000 3,100 2,000 33,100 572,300
House ABN Amro (7) Cazenove (18) Charles Stanley Cheuvreux (16) Analyst Mike Tattersall Updated 7 Apr 05 24 Mar 05 18 Nov 04 4 Nov 04 7 Apr 05 24 Mar 05 19 Apr 05 7 Apr 05 24 Mar 05 14 Jan 05 6 Apr 05 24 Mar 05 24 Mar 05 10 Mar 05 6 Apr 05 1 Apr 05 17 Nov 04 24 Mar 05 11 May 05 21 Apr 05 10 Feb 05 24 Mar 05 21 Sep 04 12 May 05 12 Nov 04 25 Oct 04 29 Mar 05 13 Jan 05 11 May 05 9 May 05 Recommendation Hold Underperform Sell 2 Outperform/Buy Sell/High Risk Underperform Hold Reduce Underperform In-Line / Cautious Sell Buy Reduce Underweight 3-Underwieght Sell Sell Underweight Hold Buy Buy Sell Sell Neutral Underperform Hold Sell Neutral 2 price target 290p 325p 225p 225p 240p 250p 225p 230p 240p 200p 225p 230p 200p 230p 300p 345p 200p 225p 300p 255p 200p 345p PBT (£m) 255 262 262 230 265 251 258 252 260 252 255 259 241 254 261 250 247 268 249 249 204 264 206 255 251 235 250 250 246 255 250 204 268 DPS (p) 7.8p 7.8p 7.8p 7.8p 7.8p 7.8p 7.8p 7.8p 7.8p 7.8p 7.8p 7.8p 7.8p 7.8p 7.8p 7.8p 7.8p 7.8p 7.8p 7.8p 7.8p 7.8p 5.0p 7.8p 7.8p 7.8p 7.8p 7.8p 7.8p 7.8p 7.7p 5.0p 7.8p
Simon Proctor Mike Dennis Dave McCarthy / Citigroup Smith Barney (2) James Anstead CSFB (6) Deutsche Bank (1) Dresdner Kleinwort Wasserstein (5) Exane BNP (13) Andrew Kasoulis Ingrid Azoulay James Grzinic Tim Attenborough/ Nicolas Just Caroline Eason Mark McCullough Fernand De Boer Ingrid Boon Jerome Samuel Matthias Reschke / Jaime Vazquez Nick Coulter Christopher Gower Andrew Fowler John Kershaw Ben Britz Niamh Sherry Iain McDonald Jonathan Pritchard Philip Dorgan / Justin Scarborough Ian Macdougall Marc de Speville Paul Smiddy Richard Ratner / Rhys Williams Clive Black / Darren Shirley Sanjay Vidyarthi David Stoddart Simon Dunn
Execution Goldman Sachs (10) ING (28) Investec IXIS Securities (12) JP Morgan (8) Lehman Brothers (21) Man Securities Merrill Lynch (3)
Mar 04 Mar 04 Apr 04 Apr 04 Jun 04 Jul 04 Aug 04 Sep 04 Sep 04 Oct 04 Oct 04 Oct 04 Dec 04 Dec 04 Jan 05 Feb 05
Morgan Stanley (11) NCB Numis Securities (37) Oriel Securities (31) Panmure Gordon a division Lazards (20) Premier Equity Redburn Partners (31) Robert W Baird (26) Seymour Pearce (49) Shore Capital (9) Teather & Greenwood (24) UBS (4)
Footnote: 2004 Thomson Extel Survey
TOTAL CONSENSUS Minimum Maximum
363 8.5p 265 5.7p 497 10.7p
Closures
H1(1) H2 (11) Total (12) H1 (1) H2 (6) Total (7)
(24,000) (42,600) (66,600) 11,000 83,000 94,000
Where Brokers' PBT forecasts use different accounting basis, the above numbers have been adjusted to be consistent with J Sainsbury plc's accounting basis, that is they are pre amortisation of goodwill, exceptional costs and non-operating items i.e. £675m in 2003/04. The forecasts above have been provided to J Sainsbury plc (Sainsbury's), by a number of registered investment analysts and are, as such, publicly available information. Sainsbury's has not commented on any individual forecasts, nor does it intend to do so in future. It should be noted that forecasts are by definition forward looking and are therefore subject to risks and uncerainties that may materially affect eventual results. Although Sainsbury's will endeavour to procure that the information is kept updated, Sainsbury's assumes no obligation to update or revise such information to reflect circumstances existing after the date hereof. Updated on 16 May 2005 This is regularly updated and can be found on our website at www.j-sainsbury.co.uk
Extensions
* ex Safeway Morrisons
(1)
Before Convenience acquisitions
APPENDIX Page 15
APPENDIX Page 16
Key dates for your diary
Contacts
IFRS Update 2 Q1 Trading Statement AGM Q2 Pre-Close Trading Statement Interim Results Q3 Trading Statement Q4 Pre-Close Trading Statement
16 June 2005 23 June 2005 13 July 2005 7 October 2005 16 November 2005 12 January 2006 24 March 2006
Lynda Ashton
Head of Investor Relations Tel / fax: + 44 (0) 20 7695 7162 lynda.ashton@sainsburys.co.uk
Kally Wilde
Investor Relations Executive Tel / fax: + 44 (0) 20 7695 6431 kally.wilde@sainsburys.co.uk
www.j-sainsbury.co.uk J Sainsbury plc, 33 Holborn, London EC1N 2HT
APPENDIX Page 17