Europris — Investor Presentation 2016

Nov 3, 2016

Presentation of results for the third quarter 2016

CEO Pål Wibe

CFO Espen Eldal 3 November 2016

Norway's leading discount variety retailer

Highlights in the third quarter 2016

• Group revenues increased 7.3 per cent to NOK 1,218 million (1,135 million)
• 1.5 per cent growth on a like-for-like basis
• New stores performing ahead of management's expectations
• Adjusted EBIT increased 6.4 per cent
• Adjusted profit before tax affected by unrealised fx loss
• Streamlining and efficiency throughout the value chain ensure continued cost control
• Three new store openings two located in shopping centres
• Strong new store pipeline for 2017
• 7 locations added during quarter
• 13 locations in total

LFL sales growth below market in Q3

•Overall growth performance 2,1 % 2,8 % 2,3 % 1,5 % 3,8 % 5,4 % 0% 1% 2% 3% 4% 5% 6% 7% 8% Q3 2016 YTD 2016 2015 Market Europris Y-o-Y LFL growth (%) -0.6 1.0 Europris growth rate in excess of market growth rate in the period % points 3.1

•Market includes a large number of shopping centres throughout Norway (e.g. 237 in 2016) •Source: Kvarud Analyse, Europris

Sales performance

• Sales growth of 5.4% for the chain in Q3
• A record breaking Q2 led to less demand for seasonal goods in July (busiest sales month in Q3)
• Topline momentum affected
• Market beating performance in August and September despite some headwinds from delay in seasonal shift to autumn
• Campaign success repeated
• New campaign elements introduced
• New stores performing well and ahead of management's expectations

•Retail sales per quarter

Introducing Harringtons – building on momentum in pet food

• One of the UK's leading independent dog food brands
• Positioned as high quality alternative to premium brand, Purina
• Available in-store from September

New stores pulling ahead!

• Strong performance by the latest vintage of stores
• Stores delivering sales above original expectations
• Analytical approach to identifying white spots securing high quality locations
• Systematic origination efforts

Solid pipeline of stores

• Three new stores opened in Q3
• One remaining store to open in Q4
• Grasmyr (county of Telemark)
• Closure of Solheimsviken in September
• Building due to be demolished
• Store personnel transferred to new store at Laksevåg
• Strong pipeline of new stores for 2017 ahead of expectation
• 7 new stores added to pipeline in Q3
• 13 new locations confirmed so far (including one store postponed from Q4 2016 to 2017)

Financial review

Gross margin development

• Gross margin was 41.9% in Q3 2016 vs. 43.6% in Q3 2015
• Last year positively impacted by annual stocktaking
• Positive effect reduced this year given improved quality of inventory levels and less volatile fx
• Adjusting for stocktaking, gross margin was 41.5% (41.8%)
• Some margin pressure from increased campaign sales
• Relative level of discounting remains stable

•Gross margin

OPEX development

• OPEX in % of revenue was 31.3% in Q3 2016 vs. 32.9% in Q3 2015
• Continued strong operational cost control
• Positive underlying development when adjusting for certain special costs incurred last year
• Opex in % of revenue was 32.1% in Q3 2015 when adjusting for relevant special costs

•OPEX in % of group revenue

Adjusted EBITDA development

• The gross profit reduction was offset by lower OPEX level

•Adjusted EBITDA margin

Cash flow

• Lower level of investments compared to last year on the back of reduction in modernisation activity
• Dividend payment in June 2016 reducing cash flow from financing activities compared to last year
• Last year included NOK 46m in cash in-flow from the issuance of new equity in connection with the IPO

Cash flow, NOK million	YTD 2016	YTD 2015
Cash from operating activities	14	0
Cash used in investing activities	-67	-87
Cash (used in)/from financing activities	-237	15
Net change in cash and cash equivalents	-290	-72
Cash and cash equivalents at 1 January	447	245
Cash and cash equivalents at end of period	157	173

Summary & outlook

• Soft start in July mitigated by strong performance during last two months of the period
• Despite some headwinds from delayed seasonal shift to autumn
• New stores performing well and ahead of original expectations
• Growth still #1 priority
• Concept and category development on track
• Substantial pipeline of new stores for 2017, with 13 new stores confirmed so far
• Robust cost control ensuring solid foundation
• Discount variety retail remains underpenetrated and continues to take market share
• Europris remains well positioned for the remainder of the year

Q & A

Presentation of results for fourth quarter 2016

See you 17 February 2017