Company Presentation

March 2021

Disclaimer

This Presentation was prepared by Shufersal Ltd. (the "Company"). This presentation does not constitute an offering for the purchase or sale of the Company's securities nor an invitation to receive said proposals, rather is solely intended for the provision of information. The information used when presenting the presentation ( the "Information") is provided therein for convenience purposes only and does not constitute grounds for making investments decisions, nor does it constitute a recommendation or an opinion and by no means does it substitute the investor's discretion. The presentation may include information published by third parties, the content thereof was not independently reviewed by the Company; consequently, the Company shall not be liable for its correctness. In addition, the presentation may include information based on assessments of the Company's market, data and statistical and public publications released by various authorities and third parties, the contents of which have not been independently verified by the Company, and therefore the Company is not responsible for its correctness. What has been set forth in the presentation with respect to the analysis of the Company's operations is solely summative and in order to obtain a more comprehensive review of the Company's operations and the risks it faces, one should refer to the Company's Annual Report for 2020, its Quarterly Financial Statements and its Immediate Reports as reported in the Magna System website.

The terms set forth in this presentation may be presented at a segmentation or level of detail different than those set forth in the Company's Reports or may include information that was not yet included in the Company's Reports or that was not presented as it was presented in said presentation, which to the best of the Company's knowledge are correct as of the date of their presentation.

The presentation includes Forward Looking Information, as is defined in the Securities Law, 1968 ("Forward Looking Information") even if it was not explicitly stated in its regard, which includes, inter alia, the Company's forecasts, objectives, assessments and estimations with respect to future events the materialization of which is not certain and is beyond the Company's control; which are based, inter alia, on information held by the Company as of this date, on the Company's internal assessments and expectations. The Company has no certainty that its forecasts, objectives and/or assessments shall be materialized, in whole or in part; this, inter alia, due to factors beyond the Company's control, such as changes in the market terms and environment, regulatory changes and/or the materialization of any of the Company's risk factors. In view of the foregoing, the Forward Looking Information may not be materialized or may materialize in a materially differently manner than what has been forecasted; therefore, inter alia, the Company's de facto results and accomplishments may materially differ from those presented in the Forward Looking Information. The Company does not undertake to update the information included in the presentation, in whole or in part, for it to reflect events and/or circumstances occurring after the preparation of the presentation.

Shufersal At a Glance

Founded in 1957

100% free float

management team

Stable and experienced

as Israel's 1 st modern supermarket, Shufersal is the leading and largest food retailer in the country

Wide range of retails formats

catering to all segments of the population, with nationwide footprint

Three main segments:

Retail (includes online, private label, B2B and finance) – 94% of sales
Be (Pharma) 5% of sales
Real Estate (commercial properties incl. Shufersal stores) – 1% of sales

Pioneered online retail in Israel with largest e-commerce website in the country

Developing marketplace offering

Shufersal – Major Anchors

Favorable Macro-Economic Environment

Young and Growing Population(1) (mn) Stable Macro Environment with Controlled Inflation

Robust Economic Growth (change in real GDP, % per annum)(3) 3.6% 3.6% 3.4% (2.4%) 6.3% 5.8% 2.7% 2.3% 1.6% (5.5%) 3.3% 3.2% 2021E 2022E Israel OECD Average

Leading the Way in Vaccine Rollout

Cumulative COVID-19 vaccination doses administered per 100 people(4)

One of the youngest and fastest growing population amongst developed countries
Standard of living has consistently improved in recent years, fueling the growth of the retail market
5 (1) Central Bureau of Statistics (CBS). (2) Storenext. (3) OECD, Bank of Israel for Israel GDP forecast (according to the rapid vaccination scenario). (4) Our World in Data as of February 15th-17th, 2021.

Israel Food Retail Sector Overview

Growth Strategy

Growing online penetration; and a developing marketplace offering

Shufersal 2020 – Key Metrics

13.4% YoY Increase in Same Store Sales

25.8% Private Label Share(2)

Property Owned Value

NIS 2.6B

S&P Maalot Rating

Shufersal has shown tremendous growth and profitability in 2020

YoY growth

9 (1) After deducting NIS 53mn Be tax refund in 2019, an increase of net profit of 80% YoY.

RETAIL

Food Retail – Overview

Shufersal brings a value proposition of quality, variety and foothold
Each retail format is designed to provide a customized answer to the population segments it is targeting

				K sq.m. commercial space	Sales per sq.m. )NIS K(	Gross profit	Operating profit	Share of company revenue in retail
Discount		• Low prices • Wide range of products • Caters to all segments of population incl. to growing ultra-orthodox	2020	400	28.1	23%	2.4%	81%
		• Online available across the country via website or app	2019	409	24.8	24%	1.8%	80%
Urban & Proximity	• Smaller store space • Range of products adapted to targeted population and store size	2020	103	27.1	33%	5.3%	19%
		• Focus on convenience, fresh, service and availability	2019	102	24.7	33%	4%	20%

Same store sales – Retail

Strong and Steady Performance Across All Retail KPIs

(1) Including online sales, excluding Online Be and "Rural region".

13 (2) Shufersal stores, excluding shipping centers.

Shufersal Online: Israel's #1 E-commerce Website

Shufersal Online Overview

Pioneered retail shift to online in Israel with 1 st version of Shufersal Online website and application in 2013
- Comprehensive website overhaul in 2019
1 st mover advantage allows to maintain clear leadership
Nationwide footprint, backed by robust logistic infrastructure covering 100% of the population
More diversified offering than physical stores
- Additional non-food items (e.g. furniture, appliances, travel)
- "Be" pharma and cosmetic products
- Catering to the growing ultra-Orthodox market
Customized marketing outreach through loyalty programme of over 2mn households
Leveraging the Shufersal online platform to generate additional traffic and revenue through marketplace business model

#1 Market Share Outpacing Competitors…

…with Rapidly Increasing Online Sales Online Sales as % of Sales in Shufersal Stores

Consistent Expansion of Private Label

15 Note: not including Be and Gidron (baked goods).

Shufersal Private Label: the 4 th Largest Food Brand in Israel

FMCG Market grew by 9.3% YoY
Shufersal Private Label FMCG grew by 18.3% YoY
Total Shufersal Private Label grew by 16.9% YoY

It should be noted that this slide corrects the corresponding slide included in the Company's presentation published on January 18 2021 (Ref. No.: 2021-01-007216). The slide published in January included the Company's data excluding VAT (whereas the data in respect of the other suppliers included VAT). The slide also included, in respect of the Company, fresh food sales; however, FMCG does not include fresh food sales. In the current slide, the Company's data included VAT, and the Company's FMCG sales and fresh food sales were presented separately. The data presented regarding the other suppliers include FMCG sales only.

Source: Storenext, public company filings

Sales (NISbn)

Note: FMCG sales exclude vegetables and fruits, NF, pastries, fresh meat and cigarettes. Including VAT.

(1) Shufersal Private Label sales. Including VAT.

Shufersal B2B Tapping into Fragmented Wholesale Market

Opened 1 st store in 2018, targeting urban minimarkets, kiosks and food service customer. Over 10K points of sale.
Attractive value proposition to merchants: one stop shop solution with attractive prices.
Currently 2 stores, with the 3 rd store in construction; online site launched in mid 2019.

Cash & Carry "Rural & Urban Region"

Providing solutions for groceries in rural communities, "kibbutzim" and urban groceries.
Serving about 550 points of sale nationwide.

Cash & Carry and "Rural & Urban Region" represent a compelling growth opportunity, targeting an overall market of NIS11.5bn composed of mini-markets, groceries and food service, growing at 5+% historically(1)

Israel's Largest Retailer Club

Retailer Club Overview

#1 Loyalty programme with over 2mn households
Retailer club offers unique discounts and benefits to members
Gather granular data on each member and provide dedicated targeted offering, including via e-mail, SMS and the application
Most loyal customers convert into the credit card retailer club, which is Israel's leading credit card club
Cards issued by leading credit card company CAL, leveraging Shufersal distribution network

Evolution of Active Cards Over Time (k)

Growth Levers

Leverage Shufersal's retail footprint in order to recruit new members
Provide attractive non-bank credit offering
Continue to recruit "Be" customers through retail club
Boost private label through consistent discounts
In January 2021, Israel Discount Bank and Shufersal entered into a first-of-its-kind strategic collaboration
- The joint venture will operate using the PayBox platform, offering an advanced digital wallet, including a "financial supermarket" offering innovative banking products and services

(1) Not including run-off of previous Leumi Card cards from 2018 onwards.

Be – Expansion into Pharma, Cosmetic and Toiletry

• Acquisition of New Pharm chain

Provider of pharma (prescription and OTC drugs) and toiletry products
Opening of 63 branches
Rebranding to Be
Conception of strategic plan
Operational combination with Shufersal (e.g. IT, HQ)
Consolidating growth in same-store sales
Opening of innovative concept stores
Leveraging synergies with Shufersal group
Continued growth in same-store sales
Momentum in online channel – food + pharma
Break-even reached in the 4 th quarter of 2020

STRATEGIC TARGET

• Margins in line with Retail

Be – Expansion into Pharma, Cosmetic and Toiletry (Cont'd)

Rapidly Growing Segment

Operational balance in the fourth quarter of 2020

Strategic Initiatives

Online pharmacy – delivery through Shufersal website or pick up in stores
- Dedicated shipping center for online Be products
Niche positioning
- Vitamins/perfumes with attractive value proposition
- Medical cannabis
Cross-buy on Shufersal shopping floors
Be private label

REAL ESTATE

Shufersal Real Estate

Segment Overview

Owns 94 income-producing assets: mainly commercial and offices

• Consistently improving KPIs with 197K sqm with 97% occupancy rate as of 2020

Properties are acquired, developed, renovated and leased out

c.70% of GLA are Shufersal stores,

c. 30% are leased to third parties

Segment income derived from rental fees and management fees

GAV: NIS 2.6bn (fair value not impacted from COVID-19)

• Not including logistic assets

Select Tenants

Over 150 tenants including some of the largest retailers, corporates and HMOs in Israel

Key Financials (NISmn)

Consistent revenue and profit stream

FINANCIALS

Robust Financial Performance

(NISmn)

EBITDA (NISmn) Net Income (NISmn)

25 (1) Before other income & expenses.

(2) Adoption of IFRS-16 at the beginning of 2019 has had a positive impact on EBITDA in the amount of NIS422mn in 2019 and an impact of NIS433mn in 2020.

Consistently Improving Profitability Across Segments

Cash Flow Evolution

390 199 730 1,040 50.6% 25.3% 57.7% 68.7% (3) Free Cash Flow(1) and Cash Conversion(2) (NISmn)

Commentary

Disciplined capex policy
c. NIS650mn total investment in new automated logistic centers spread over 4 years from 2018
2018 investment in Be (e.g. stores, IT, rebranding) post acquisition in 2017
Conservative capex in 2020 due to COVID-19 outbreak
- Some renovation work put on hold

(1) EBITDA – Capex.

(2) (EBITDA – Capex) / EBITDA.

(3) Adoption of IFRS-16 at the beginning of 2019 has had a positive impact on EBITDA in the amount of NIS422mn in 2019.

Exceptional Liquidity and Balanced Debt Profile

(NIS millions) in	31 12 20
Linked Bonds Non CPI	1 865 ,
Linked Bonds CPI	1 084 ,
Total Debt	2 949 ,
Cash & ST Investments	(880)
Debt Net	2 069 ,
Lease(1) LTM Net Leverage IFRS-16 exc.	1 9x
Liability Lease	3 904 ,
LTM Net Leverage inc IFRS-16 Lease	3 9x

Undrawn RCF	800
Total Liquidity	1 680 ,

Cap Table Future Bond Repayments(2)