RetailStar Ros Target 2018

Global Pictures of Goods Purchase

in 2018
In order to reach the
target of >4% of ROS, RS
will decide to invest in
Asian Market, to achieve
a +10% in Revenues, and
to push the sales of
products with higher
margin (Grocery
+2%,Frozen +2%,Fresh
+3%), and drop the sell of
H&C product (-5%) and
Household (-3%), and
keep Beverage at same
%.
Total Purchase
30.195M€
 RS next challenges
• Opening of new stores in Asia:
2018 NEW Superstores: +20 → 10MLN€/each
2018 NEW Department: +60 → 20MLN€/each

Total: 370 Superstores – 810 Department:

Total Stores Cost 15.500MLN€ (assuming stores operative
from 1stJanuary 2018)

• Marketing Campaing:
3.850MLN€ in order to push the new Asian Market, RS
will invest an ammount of 7% the expected revenues
value

• IT project for digitalization: 3.000MLN€

Corporate cost will increase of +3% compare to 2017 cost:

2.060MLN€
 Depreciation & Non
Manufacturing Cost
New stores will generate a flat depreciation of 250MLN€ for
20 years.
On top of that, 750MLN€ depreciation from old Investment

Important: Depretiation from IT investment of 300MLN€ x 10

years will start at the end of the project (assumed not in
2018)

Total Non Manufacturing Cost:

Marketing: 3.850MLN€
Corporate: 2.060MLN€
Depreciation: 1.000MLN€

TOTAL: 6.910MLN€
 CAPEX SCENARIO 2018
Capex Budget
Total Value
MLN€ Lifetime Deprec. Cash Out
Year 2018 2019 2020
Old Depreciation 750
Store Investment 5.000 20 250 3.000 2.000 -
IT Investment 3.000 10 - 1.500 1.500 -
Total 8.000 1.000 4.500 3.500

Store Investment: 60% in 2018 – 40% in 2019

IT Investment: 50% in 2018 – 50% in 2019

Depreciation from IT investment of 300MLN€ x 10 years will

start at the end of the project (assumed not in 2018)

Total Investment Value: 8.000MLN€

Cash Out 2018: 4.500MLN€
Conclusion → TARGET ACHIEVE

With an EBIT of 2.395 ROS% will be 4,35%

(ROS=EBIT/REVENUES) so RS will achieve the target.

Important: such result will be possible only if depreciation of IT project will

not start in 2018 otherwise 3,81%