5b44c7a411b3908a3fd139.pdf


Bank of America Merrill Lynch

Emerging Stars Symposium

Nick Abboud

Managing Director & CEO 8 October 2015

Growth Strategy - designed to deliver sustainable results


Store growth

  • 15-20 new stores p.a. under Dick Smith and MOVE banners. Upside potential with Duty Free

    Formats

  • New formats such as MOVE and Duty Free considerably expand our demographic reach

    Online

  • Convenient shopping opportunity leverages store network to maximise 'disrupter' benefits

    Private Label

  • Differentiated product offering provides strong value proposition

    Mobility

  • Center piece of connectivity with strong replacement cycle

    New categories

  • Fitness & wearables and Small Appliances improving halo effect

    Cost control

  • Continued focus on driving lower cost to serve part of our DNA

  • Further opportunities across business. Will maintain store productivity

Store Growth - leveraging largest store network


  • Fastest growing consumer electronics retailer with largest number of stores

  • Since IPO, opened 70 stores (net) with 393 conveniently located stores in Australia & NZ

  • Sustainable network of 420-430 stores by FY2017, with 15-20 new stores opening annually

  • Will (and have) closed stores where dynamics not sustainable

  • NZ network profitable. Strong focus on 5 year outlook before re-signing leases



    FY15


    As at 30 September

    As at 30 September 2015


    Australia

    28-Jun Opened Closed Total NT


    3

    Electronics Powered by DS

    28

    0

    0

    28

    WA

    66 5 3

    MOVE

    10

    1

    0

    11

    36 1

    SA

    MOVE by Dick Smith

    4

    0

    0

    4

    21

    3

    1

    NSW and ACT

    Dick Smith 289 0 1 288

    QLD


    331 1 1 331


    91 13 3 4

    New Zealand

    Dick Smith 62 0 0 62

    62 0 0 62

    1 1 393

    TOTAL 393


    350


    28


    11

    64 VIC 6 4

    7

    TAS


    4


    62


    NEW ZEALAND



    Dick Smith

    • Competitive advantage remains location and service

    • Full range of sought after brands across the network

      • Major retailer of Apple, Samsung, Oppo, Go Pro & Fitbit

    • Range enhancements attracting a more balanced customer mix

      • Improved attractiveness to non-traditional customer

        through fitness and small appliances

      • Increasingly able to leverage this foot traffic into

        purchases within the 'traditional' Dick Smith range

    • Computers, phones and accessories biggest sellers

    • Strong growth in Fitness & TVs

      Move

    • Achieving critical mass, with 12 stores in Australia (including recent store openings )

    • Audio, Fitness and Accessories the biggest selling items

    • Achieving business case expectations, with sales maturation expected to be 3 years


      Male


      Dick Smith


      Older


      Duty Free

      Move


      Younger


      David

      Jones


      Female



      Duty Free (MOVE by Dick Smith)

    • Caters to travellers of all age groups

    • 4 locations at Australia's premier tourist gateway

    • Move into premier location in December 2015 as part of new terminal layout

    • Featuring key core categories: Mobility, Office, Entertainment & Accessories

    • Audio, Fitness and Accessories the biggest selling

      items

    • Performance since taking over in February 2015 ahead of our $50m annual sales guidance


      Electronics Powered by Dick Smith

    • Focus on a more affluent female customer

    • Key products include Apple, large format TVs, Bose


      Online sales doubled to more than 8% of retail sales

  • One of Australia's leading omni-channel retailers

  • Well placed to achieve 10% of sales online by FY2017

    Comprehensive omni-channel platform integrating multiple sites

  • DS AU & NZ; David Jones; MOVE; eBay; Catch of the Day; Westfield, Trade Me & Groupon

  • Driving online customer base into in-store repeat sales


    WA 20


    NT


    3


    SA 12


    QLD


    35


    As at 30 September 2015

    Sustainable competitive advantage

  • Leveraging Australasia's largest consumer electronics store

    network

  • Lower freight, fulfilment costs and speedier delivery

    Pay & Collect available in all stores

  • allows staff to up-sell and attach on approx. 50% of online sales

    Store fulfilment from 210 locations

  • Expanding to over 300 before Christmas

  • Further enhancement opportunities in driving attachment

NSW and ACT

62

43 VIC

31

4

TAS


  • Private Label penetration >12.5% of sales

    • TVs, Audio & MOVE accessories enjoyed strong growth

  • Good, Better, Best ranging attracting customers

  • Pricing hierarchy of premium MOVE range

    resonating well with customers

  • 40% increase in product range, reflecting consumers' strong desire for quality Private Label

  • Well placed to benefit from fall in AUD

    • Strong stock levels of non-aging product

    • Lower pricing to national brands - mix shift

      beneficiary

  • On track to drive penetration to >15% of sales by FY2017


  • Mobile phones to increasingly be the center of consumer connectivity

  • Dick Smith is well placed to provide customer needs

  • Only major retailer offering prepaid options across all major networks in Australia

  • Continue to grow market share

  • Strong share in prepaid and unlocked (sim free) phones

  • New product accessibility benefited outright sales & prepaid

  • Post-paid performance consistent with expectations

  • Attractive longer-term category

    New categories - 'Connected Home by Dick Smith'


    • The 'Connected Home by Dick Smith' rolling out in 100 stores this month, leveraging competitive footprint

    • Access Small appliance category, worth $1.7 billion p.a. and expected to grow strongly, as it

      becomes 'connected' to the internet

    • Ranging adjacent to fitness with ~10-15% of store footprint, replacing under-performing categories

    • Early days, but pleased with initial indications


  • Dick Smith ranging leading brands including Breville, Delonghi, Dyson, Kambrook, Nespresso and Philips

  • With the next generation of products, consumers will be able to operate small appliances in the home directly from their electronic (mobility) devices


Kitchen Appliances Processers Mixers

Blenders

Beverage Coffee Kettles Juicers


Electrical Cooking

Fryers Rice Cookers Slow Cookers

Toasters Microwaves


Seasonal

Fans

Electric Heaters

Linen Care

Irons

Steam Stations


Floor Care Vacuum Cleaners Steam Mops


Where we are Where we will be



Launched Dec '14

-

-

-

-

Omni-channel triggered campaigns

Advanced segmentation & analytics Depth of customer data

Partnerships with key brands for post-purchase marketing

Target

Over 2 million

Members by June 2016

- Instore signup

  • Email receipts


    - Facebook custom audiences

  • Triggered campaigns for online

customers



10%


Dick Smith categories


16%

Office

6% Mobility


11%

Entertainment


11%

Home solutions



9% 14%

5% 10%


4% 9%

10%


9%


8% 12%

3% 8% 8%



7% 10%

2% 7% 7%


1% 6% 6%


1Q14

2Q14

3Q14

4Q14

1Q15

2Q15

3Q15

4Q15

1Q16 TD

1Q14

2Q14

3Q14

4Q14

1Q15

2Q15

3Q15

4Q15

1Q16 TD

6% 8%

1Q14

2Q14

3Q14

4Q14

1Q15

2Q15

3Q15

4Q15

1Q16 TD

1Q14

2Q14

3Q14

4Q14

1Q15

2Q15

3Q15

4Q15

1Q16 TD

1Q14

2Q14

3Q14

4Q14

1Q15

2Q15

3Q15

4Q15

1Q16 TD

0% 5% 5%


Continue to grow share in key categories

Reduced computer promotional activity kept share flat

Strong tablet growth

Growing share through unlocked, contracts

Audio (particularly headphones) driving above industry growth

Fitness growth 2.5x market

Navigation & cameras de- emphasis continues


Source: GfK Retail Management Australia Summary. 1Q16TD is July & August

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