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Annual General Meeting10 July 2013
David TylerChairman
Justin KingChief Executive
2012/13Operating review
Delivered good sales and profit growth, outperforming the market
Quality own-brand offer remains a key point of difference
Nectar, coupon-at-till and Brand Match key to success
Online and convenience businesses continue to grow strongly
Acquisition of Sainsbury’s Bank allows continued development of complementary channels
bps
Group performanceHighlights
Underlying results
Sales (inc VAT)
Sales (inc VAT, ex fuel)
Operating profit
Net finance costs
Share of JV profits
Profit before tax
Tax rate
Basic EPS(1)
Full year dividend per share
Statutory results
Items excluded from underlying results
Profit before tax
2012/13£m
2011/12£m
4.6 4.3 5.1
(1.8)18.8 6.2 245 9.3 3.7
(63.2)(1.4)
Change%
%pp
%pp
25,632
829 (111)
38 756
23.7 30.7 16.7
32 788
24,511
789 (109)
32 712
26.1 28.1 16.1
87 799
Underlying basic earnings per share(1)
2012/13Strong trading performance
Significant market beating sales performance in a challenging market- total sales up 4.3%, like-for-like sales up 1.8%(1)
Underlying operating profit up 5.1%, slightly ahead of sales growth
Kantar Total Till roll 12 w/e
(1)
(2)Sales including VAT and excluding fuel
MorrisonsSainsbury’s
Tesco
Total GroceryAsda
Sainsbury’s sales growth is strong in a tough marketTotal sales growth (2)
Q1 Q2 Q3 Q4 Q12012/13
Market backdrop A year like no other
Queen's Diamond Jubilee, Olympics and Paralympics
High levels of customer awareness and colleague engagement
Legacy programmes launched- Active Kids for All- Sainsbury’s Anniversary Games
Live Well For LessIncreasing the number of own-brand customers
Own-brand sales have grown faster than branded sales- Total own-brand sales up nearly 5% year-on-year- Growth in all three tiers
Our values are a long term, strategic point of difference- Invested in our supply chain and sourcing credentials- DNA testing for over 10 years
Live Well For Less Unique combination of Nectar, CAT and Brand Match
Brand Match is helping to close the price perception gap- Around 350m coupons issued to date- ‘Cheaper than’ coupons issued over 50% of the time
Unique combination of Nectar and coupon-at-till (CAT)- Issue relevant and personalised promotions- Incentivises customers to shop different channels- Reward loyal customers – over £110m
redeemed in-store last Christmas
Health: Trained pharmacists in over 270 stores as Healthy Eating Advisors
Sourcing: RSPCA ‘Retailer of the Year’ and continue to be the largest retailer of Fairtrade, MSC fish and Freedom Foods products
Environment: 82,000 solar panels on 189 stores –largest multi-site solar array in Europe
Our values make us differentContinue to work towards our 20x20 commitments
Community: Presented a record cheque for £10.5m to Comic Relief
Great place to work: Created 400 apprenticeship places
Performance Brand performance
Winner of Supermarket of the Year for 5 of the last 7 years
Winner of Convenience Chain of the Year for the last 3 years
Winner of Online Retailer of the Year
Winner of Employer of the Year
Business In The Community – Platinum Big Tick 2013
Winner of Grocer 33 Customer Service & Availability Awards
A long-term vision for growth
Sources: Ipsos-MORI (from Jan 2009 to P1 2012/13) and Brand Face (from P1 2012/13 to date) unweighted rolling 8 week data.
Base sizes per rolling period : Sainsbury’s (c.800), Tesco (c.400), Asda (c.250), Morrisons (c.200).
Great FoodContinued leadership in quality food
MorrisonsSainsbury’s
TescoAsda
2009/10 2010/11 2011/12 2012/13
8.4
8.2
7.8
7.7
Quality of products (scale of 1-10)
Completed our re-launch of Äó=p~áåëÄìêóÛë- Over 6,500 lines, many new or improved- Winner of Own-Label Range of the Year
Fresh counters in over 500 stores- Over 20,000 colleagues trained at
7 food colleges
Continue to invest in British food- Biggest volume retailer of British apples
and pears
Great FoodContinual investment in own-brand
Compelling General Merchandise and ClothingStrong contribution to overall performance
GM and Clothing has grown at over twice the rate of food over the year
Strong clothing sales growth has continued- 7th largest UK clothing retailer by volume- Launched a further 4 dçâ=Ñçê=qì=ranges
Achieved the milestone of £1bn annual GM sales- 7th largest UK retailer for homeware by value
Convenience sales of over £1.5bn and growing at 17% year-on-year
Opened 87 stores during the year and a second dedicated convenience depot at Thameside
Groceries online business of nearly £1bn
Improved operational efficiency, customer service and availability over the year
Complementary Channels and ServicesConvenience and online businesses growing strongly
Sainsbury’s BankA year of growth
Sainsbury’s brand and in-store marketing reduce costs of acquiring new customers
Ability to leverage Nectar data to reward and incentivise customers
Strong track record of profit growth
8% increase in active accounts over the year to 1.5m
Strengthened management team
Bank profit before tax(1) (£m)
100% Sainsbury’s Bank PBT adjusted to J Sainsbury plc year end(1)
Sainsbury’s BankAcquisition of Lloyds Banking Group’s 50% share agreed
Clear benefits for customers and shareholders
Bank customers are more loyal and spend more in-store
Expected to complete January 2014
Mobile Äó Sainsbury’s: JV announced with Vodafone
Sainsbury’s Pharmacies: Over 270 in-store pharmacies and 3 hospital pharmacies
Sainsbury’s Energy: 83% increase in customers over the year
Insight 2 Communication: JV with Aimia that allows suppliers todeliver targeted offers to our customers
Launched a number of digital businesses:- Rovi- Sainsbury’s Entertainment- eBooks Äó Sainsbury’s
Developing new businessExpanding our brand into new areas
Growing Space and Creating Property ValueA unique space growth opportunity
Convenience
Increasing the proportion of convenience space, reflecting the change in consumer shopping habits
Highly accretive investments, generating strong returns
Extensions
Increasing the proportion of customers with access to a full non-food offer – from 11% to 33% over the last 5 years
Supermarkets
Opening stores in select locations where Sainsbury’s does not currently have a presence – there are 35% of postcodes where Sainsbury’s market share <5%
A long-term vision for growth
Summary
Good sales and profit performance
Continued strength in own-brand
Competitive advantage through Nectar, coupon-at-till and Brand Match
Strong growth in our multi-channel businesses
Opportunities to further develop Sainsbury’s Bank
Consistent delivery of our long-term vision for growth
Annual General Meeting10 July 2013
Q&A
Annual General Meeting10 July 2013
Resolution 1
To receive the Directors’ and Auditors’ reports and accounts
Number of shares
For 1,341,100,920 99.98%Against 256,360 0.02%Withheld 99,103
Resolution 2
To approve the Directors’ Remuneration Report
Number of shares
For 1,291,993,930 96.91%Against 41,143,555 3.09%Withheld 8,319,611
Resolution 3
To declare the final dividend
Number of shares
For 1,341,348,001 100.00%Against 34,699 0.00%Withheld 62,705
Resolution 4
To elect Susan Rice as a Director
Number of shares
For 1,339,563,302 99.88%Against 1,670,853 0.12%Withheld 230,605
Resolution 5
To elect Jean Tomlin as a Director
Number of shares
For 1,339,921,407 99.90%Against 1,359,221 0.10%Withheld 210,940
Resolution 6
To re-elect Matt Brittin as a Director
Number of shares
For 1,339,874,896 99.89%Against 1,415,787 0.11%Withheld 200,077
Resolution 7
To re-elect Mike Coupe as a Director
Number of shares
For 1,331,531,444 99.59%Against 5,415,216 0.41%Withheld 4,521,784
Resolution 8
To re-elect Mary Harris as a Director
Number of shares
For 1,339,851,951 99.89%Against 1,451,329 0.11%Withheld 182,563
Resolution 9
To re-elect Gary Hughes as a Director
Number of shares
For 1,339,940,851 99.90%Against 1,359,658 0.10%Withheld 191,315
Resolution 10
To re-elect Justin King as a Director
Number of shares
For 1,331,596,101 99.60%Against 5,370,307 0.40%Withheld 4,518,542
Resolution 11
To re-elect John McAdam as a Director
Number of shares
For 1,326,614,200 99.41%Against 7,824,842 0.59%Withheld 7,048,384
Resolution 12
To re-elect John Rogers as a Director
Number of shares
For 1,339,407,583 99.86%Against 1,885,721 0.14%Withheld 195,195
Resolution 13
To re-elect David Tyler as a Director
Number of shares
For 1,327,249,081 99.73%Against 3,654,766 0.27%Withheld 10,587,076
Resolution 14
To re-appoint PricewaterhouseCoopers LLP as auditors
Number of shares
For 1,337,656,973 99.73%Against 3,670,758 0.27%Withheld 150,261
Resolution 15
To authorise the Audit Committee to agree the Auditors’ remuneration
Number of shares
For 1,339,801,931 99.89%Against 1,508,922 0.11%Withheld 174,514
Resolution 16
To authorise the Directors to allot shares
Number of shares
For 1,303,645,304 97.19%Against 37,626,431 2.81%Withheld 219,762
Resolution 17
To disapply statutory pre-emptive rights (Special Resolution)
Number of shares
For 1,337,161,068 99.71%Against 3,852,610 0.29%Withheld 476,959
Resolution 18
To authorise J Sainsbury plc to make ‘political donations’ and incur ‘political expenditure’
Number of shares
For 1,332,632,596 99.40%Against 7,993,132 0.60%Withheld 831,859
Resolution 19
To approve purchase of own shares (Special Resolution)
Number of shares
For 1,337,515,287 99.72%Against 3,702,605 0.28%Withheld 270,356
Resolution 20
To authorise the calling of general meetings on not less than 14 days’ notice (Special Resolution)
Number of shares
For 1,258,376,109 93.82%Against 82,858,259 6.18%Withheld 257,231
Annual General Meeting10 July 2013