Jumbo Neutral (from Neutral) Retail High Risk Target Price · Jumbo is the biggest toy, baby, home...

Jumbo Neutral (from Neutral) Mkt. Price: € 9.75

Retail High Risk Target Price: € 10.8

FTSE Market: 465.41

Equity Research | Update

Changes

Target price 10.8

of which DPS 0.27Previous 9.30

Total stock return 13.6%

Valuation 2014a 2015e 2016e 2017eP/E 12.7x 13.5x 12.5x 11.7x

P/BV 1.7x 1.5x 1.4x 1.3x

EV/Sales 2.0x 1.8x 1.7x 1.6x

EV/EBITDA 7.4x 7.5x 6.8x 6.2x

EV/EBIT 8.5x 8.8x 7.9x 7.2x

Dividend yield 1.8% 2.6% 2.8% 3.0%

FCF yield 6.4% 4.7% 7.1% 8.2%

Per share

EPS 0.77 0.70 0.76 0.81

EPS old 0.78 0.66 0.75 0.80

DPS 0.18 0.25 0.27 0.28

BS data (€m)

Sh. Equity 797 859 926 998

Net debt -152 -171 -212 -257

P&L data (€m)

Revenues 583 617 641 662

EBITDA 159 149 159 168

EBIT 138 128 136 144

Net income 105 96 103 110

Trading data 1m 3m 6m 12m

Rel. Performance 24.7% 36.4% 40.6% 50.3%

Abs. Performance 15.0% 37.7% 17.2% 15.0%

H | L 52w 10.98 5.20

Market cap. (mn) 1326.58

Shares outstanding (m): 136

Free float (%, mn) 68% 902.08

Avg. vol. Traded (52w): 313k

Index constituent & weight:

ASE (5.5%), FTSE LC (5.0%), FTSE MI (4.79%)

Antonis Diapoulis

Analyst

[email protected]

T +30 210 367 7532, +30 210 367 7513

Please refer to important disclosures in the Disclosure Appendix

Jumbo is the biggest toy, baby, home and seasonal products retailer in Greece with strong presence in Cyprus and

Bulgaria. The company operates 72 stores, 53 of which in Greece, 4 in Cyprus, 6 in Romania and 8 in Bulgaria.

Alpha Finance does and seeks to do business with companies covered in its research reports. Consequently, investors should be aware that the firm may

have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only a single factor in making their

investment decision.

26 November 2015

RIC: BABr.AT, BBG: BABY GA

Rating - TP EPS -Is Jumbo up for beating again its guidance?

1Q 15/16 performance had almost no surprises since both sales and profitability

came broadly in line with our estimates. What was unexpected thought was that

sales in October and November were up in all markets including Greece! For Bulgaria, Romania and Cyprus such a performance was anticipated but not for

Greece. It seems that Jumbo has gained enough market share to counterbalance any negative trends in the domestic retail market. Thus, our estimate for a 4%

decrease in gross Greek sales seems too pessimistic. With this note we set the relevant decrease to -1.3% y-o-y and set l-f-l to grow at 2% from 2016/17e

onwards instead of 2018/19 previously. Our assumptions still lie within the guidance range since we are still uncertain whether Greek consumer sentiment

will not deteriorate in 2H 15/16 due to new austerity. Altering our assumptions for

Greece and also setting our WACC estimates lower (10% vs. 10.8% previously) we increased our target price to €10.8/ share vs. €9.3/share previously.

Business Strategy – Network Rollout

By the end of 1Q 15/16 Jumbo operated 73 stores out of which 53 are located in Greece, 5 in Cyprus, 8 in Bulgaria, 7 in Romania and one e-shop. Strategy for this

year remains somewhat vague as the management is concerned over the capital controls in Greece. Nevertheless, we expect restructuring in the Greek network

and expansion in Romania to continue. On this basis, we have assumed no new stores in Greece, Cyprus and Bulgaria and three new stores overall in Romania.

Under this assumption Jumbo will operate 75 stores by June 2016 (unchanged to

AFe old).

1Q 15/16 snapshot Jumbo announced 1Q 15/16 results which marginally beat our bottom line

estimates. In detail, revenues, EBITDA and net income stood at €152.6mn (+4.9% y-o-y), €32.8mn (+9.6% y-o-y, AFe €32.3mn) and €21.8 (+8.9% y-o-y,

AFe €20.6mn) respectively. Sales were pre-announced thus no surprise there. Looking in more detail, Greek revenues were down 1.5% y-o-y, Cyprus was up

10.5% y-o-y, Bulgaria 11.8% y-o-y and Romania 2.2x. Gross profit margin reached 47.97% vs. 47.55% in 1Q 14/15 (AFe 47.2%) since transportation costs

remained favorable. This explains the small miss vs. our estimates.

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O-14 N-14 J-15 F-15 A-15 M-15 J-15 A-15 O-15

52w performance

Vol traded (,000s shares) LH scale Adjusted price

mailto:[email protected]

Alpha Finance Equity Research Jumbo

Please read important disclosures at the end of the report. - 1 -

Rating: Neutral | High risk Share price performance Jumbo

Target price: 10.8 (%) 1m 6m 12m Current Price €9.49

of which DPS: 0.27 Rel 22% 31% 47% Sector:

Total stock return: 13.6% Abs 12% 8% 12%

Mkt cap (mn): 1,291 Free Float: 68.0% Jumbo is the biggest toy, baby, home and seasonal products

retailer in Greece with strong presence in

Cyprus, Romania and Bulgaria. The company operates 73 stores out of which 53 are located in Greece, 5 in Cyprus, 8

in Bulgaria, 7 in Romania and one e-

shop.

Enterprise value 1,139 H | L 52w 10.98 5.20

Headline figures (*) 2011a 2012a 2013a 2014a 2015e 2016e 2017e

P&L items (€mn)

Revenues 494 502 542 583 617 641 662

Ebitda 134 110 146 159 149 159 168

Ebit 117 92 127 138 128 136 144

Pre tax income 119 96 130 137 130 140 149

Minorities 0 0 0 0 0 0 0

Net income 97 74 101 105 96 103 110

EPS (€) 0.75 0.54 0.74 0.77 0.70 0.76 0.81

DPS (€) 0.00 0.00 0.18 0.18 0.25 0.27 0.28

No. of shares, weighted 130 136 136 136 136 136 136

Balance sheet items (€mn) 2011a 2012a 2013a 2014e 2015e 2016e 2017e

Fixed assets, net 415 431 446 498 512 524 535

Cash & equivalents 185 170 288 299 318 358 404

Current assets 412 421 552 557 609 665 725

Total assets 857 894 1,034 1,090 1,156 1,224 1,295

Equity 593 639 745 797 859 926 998

Minorities 0 0 0 0 0 0 0

Long term debt 152 1 144 144 144 144 144 website: www.jumbo.gr

Long term liabs 162 13 156 170 170 170 170

Short term debt 2 148 21 3 3 3 3 all prices as of November 24th

Current liabilities 101 242 133 123 127 128 127

Equity & liabilities 857 894 1,034 1,090 1,156 1,224 1,295 Research analyst

Cash flow items (€mn) 2011a 2012a 2013a 2014e 2015e 2016e 2017e Antonis Diapoulis

Gross cash flow 105 94 138 127 117 126 134 +30 210 367 7532

Δworking capital -3 30 10 -12 30 14 15 [email protected] Operating cash flow 108 64 128 139 87 111 119

Capex 53 34 28 63 35 35 35

Free cash flow 55 31 100 76 52 77 84

Δdebt -2 -5 16 -18 0 0 0

Δequity -27 -27 1 0 0 0 0

Dividends 0 0 0 45 33 36 39

Dividends to mins 0 0 0 0 0 0 0

Cash Position 185 170 288 299 318 358 404

Y -o - Y change (%) 2011a 2012a 2013a 2014e 2015e 2016e 2017e

Revenues 1% 2% 8% 8% 6% 4% 3%

Ebitda -1% -18% 33% 9% -7% 7% 6%

Ebit -2% -22% 39% 9% -7% 7% 6%

Pre tax income -1% -20% 36% 5% -5% 7% 6%

Net income 3% -24% 37% 4% -9% 8% 7%

EPS 3% -27% 37% 4% -9% 8% 7%

Margins (%) 2011a 2012a 2013a 2014e 2015e 2016e 2017e

Ebitda 27% 22% 27% 27% 24% 25% 25%

Ebit 24% 18% 23% 24% 21% 21% 22%

Pre tax income 24% 19% 24% 24% 21% 22% 22%

Net income 20% 15% 19% 18% 15% 16% 17%

Ratios & valuation 2011a 2012a 2013a 2014e 2015e 2016e 2017e

P/E 12.7x 17.4x 12.8x 12.3x 13.5x 12.5x 11.7x

P/BV 2.1x 2.0x 1.7x 1.6x 1.5x 1.4x 1.3x

EV/Sales 2.6x 2.5x 2.2x 2.0x 1.8x 1.7x 1.6x

EV/EBITDA 9.4x 11.5x 8.0x 7.2x 7.5x 6.8x 6.2x

EV/EBIT 10.8x 13.9x 9.2x 8.3x 8.8x 7.9x 7.2x

FCF Yield 4.4% 2.4% 8.6% 6.6% 4.7% 7.1% 8.2%

Dividend Yield 0.0% 0.0% 1.9% 1.9% 2.6% 2.8% 3.0%

Payout ratio 0% 0% 24% 23% 35% 35% 35%

Debt/equity 0.3x 0.2x 0.2x 0.2x 0.2x 0.2x 0.1x

Net debt/ebitda -0.2x -0.2x -0.8x -1.0x -1.1x -1.3x -1.5x

Interest covered 19.4x 15.4x 20.3x 18.7x 17.3x 18.4x 19.5x

RoE 16% 12% 14% 13% 11% 11% 11%

RoIC 13% 9% 11% 11% 9% 9% 9%

(*) Each year refers to the Fiscal year starting on July 1st of that year and ends June 31st the next. For example 2014

refers to the Fiscal year 2014/15a.

source: company data & Alpha Finance Research Estimates



Valuation

Valuation

We re-visited our DCF analysis setting our 2016/17 target price to €10.8/share (vs. €9.3/share

previously) taking into account the surprising performance in Greece during October and

November. We have slightly decreased variable WACC to 10 % vs. 10.8% previously, by

adjusting ERP and Rf to 5% and 7% respectively (vs. 5% and 8% previously) and setting

terminal growth rate at 2.5% in order to grasp the long term upside potential of the company

which we believe has not been affected.

Source: Company data | AFe |

Jumbo DCF Model

(mn eu)

Revenues 412 414 426 438 432 441 450 454 459

EBITDA 134 110 146 159 149 159 168 172 181

EBIT * (1 - tax rate) (I) 95 71 99 106 94 100 106 109 114

CAPEX 54 34 34 63 35 35 35 35 35

Depreciation & Amortization 17 19 19 21 21 23 24 26 27

- (Capex - Depreciation) (II) 36 15 14 42 14 12 11 9 8

- Change in Working Capital (III) -3 30 10 -12 30 14 15 16 3

Reinvestment (II+III=IV) 33 45 24 30 44 27 26 26 11

Free Cash Flow (I-IV) 62 26 75 75 50 74 80 83 103

WAAC 10.0% 9.9% 9.7% 10.1% 10.0% 10.0% 10.0% 10.0% 10.0%

Discounting Factor 100% 100% 100% 100% 100% 91% 83% 75% 68%

Discounted FCF 67 66 62 70

PV of Cash Flows 265

+ Residual Value 954

Terminal Growth Rate 2.5%

- Net Debt -212

- Minorities 0

Equity Value 1431

Shares (mn) 136

Dividend per Share 0.27

DCF per share 10.8

2019-

20e

2015 -

16e

2016-

17e

2017-

18e

2018-

19e

2011 -

12a

2012 -

13a

2013 -

14a

2014 -

15a



Forecast Changes – New Assumptions – Sensitivity

Forecast Changes (mn eu) 2014/15a 2015/16e 2016/17e CAGR

Old New Old New Old New

Greece 437.9 420.4 432.1 428.8 440.7 0.0% 0.9%

%change 2.9% -4.0% -1.3% 2.0% 2.0% L-F-L Growth 0.3% -6.1% -5.2% -2.6% 2.0% % of sales 75.2% 69.5% 70.1% 68.1% 68.7% Bulgaria 45.3 49.9 49.9 50.9 50.9 4.6% 4.6%

%change 12.0% 10.0% 10.0% 2.0% 2.0% % of sales 7.8% 8.2% 8.1% 8.1% 7.9% Cyprus 75.0 98.0 98.0 100.0 100.0 10.8% 10.8%

%change 12.2% 30.7% 30.7% 2.0% 2.0% % of sales 12.9% 16.2% 15.9% 15.9% 15.6% Romania 24.3 36.6 36.6 49.6 49.6 34.3% 34.3%

%change 175.1% 50.8% 50.8% 35.3% 35.3% % of sales 4.2% 6.1% 5.9% 7.9% 7.7% Total Revenues 582.5 604.9 616.6 629.2 641.1 3.7% 4.4%

% change 7.5% 3.8% 5.8% 4.0% 4.0%

EBIT 137.9 120.0 127.7 133.1 136.1 0.6% 1.4%

% change 8.5% -13.0% -7.4% 10.9% 6.6% % margin 23.7% 19.8% 20.7% 21.2% 21.2%

Greece 120.0 91.0 98.7 99.5 102.5 -4.7% -3.7%

%change 4.6% -24.1% -17.7% 9.4% 3.9% % margin 27.4% 21.6% 22.8% 23.2% 23.3% % of EBITDA 75.4% 64.5% 66.3% 64.0% 64.6% Bulgaria 7.3 10.7 10.7 13.3 13.3 27.5% 27.5%

%change 27.9% 45.5% 45.5% 24.9% 24.9% % margin 16.2% 21.4% 21.4% 26.2% 26.2% % of EBITDA 4.6% 7.6% 7.2% 8.6% 8.4% Cyprus 25.2 31.7 31.7 32.4 32.4 9.4% 9.4%

%change 11.9% 25.5% 25.5% 2.1% 2.1% % margin 33.6% 32.3% 32.3% 32.3% 32.3% % of EBITDA 15.9% 22.5% 21.3% 20.8% 20.4% Romania 6.7 7.7 7.7 10.4 10.4 22.9% 22.9%

%change 87.0% 15.6% 15.6% 35.3% 35.3% % margin 27.4% 21.0% 21.0% 21.0% 21.0% % of EBITDA 4.2% 5.5% 5.2% 6.7% 6.6% Total EBITDA 159.2 141.0 148.7 155.6 158.6 1.1% 1.7%

% change 8.7% -11.4% -6.6% 10.3% 6.6% % margin 27.3% 23.3% 24.1% 24.7% 24.7%

Pre Tax Income 137.0 122.5 130.2 136.8 139.9 2.1% 2.8%

% change 5.4% -10.6% -4.9% 11.7% 7.4% % margin 23.5% 20.2% 21.1% 21.7% 21.8%

Net Income 104.8 90.0 95.5 101.0 103.1 0.9% 1.6%

% change 3.5% -14.1% -8.9% 12.2% 7.9%

% margin 18.0% 14.9% 15.5% 16.1% 16.1%



Case Gross Sales 2015/16e l-f-l Sales growth CAGR 14/15 - 17/18 Target Price Group Growth Greece Cyprus Bulgaria Romania Sales EBITDA Net income FCF

Bear 4.8% -6.2% 6.2% 8.0% 3.0% 1.5% -3.7% -4.4% -0.5% 9.1

Base 5.8% -5.2% 7.4% 10.0% 3.0% 4.4% 1.7% 1.6% 3.7% 10.8

Bull 10.2% 0.0% 9.9% 12.0% 3.0% 5.8% 3.5% 3.6% 5.2% 11.9

WAAC/Tg 1.0% 2.5% 4.0%

8.5% 11.1 13.1 16.3

10.0% 9.5 10.8 12.7

11.5% 8.4 9.2 10.4

Sensitivity

We updated both perspectives of our sensitivity exercises.

We observe how the target price will fluctuate on the back of our new base case for Greece.

We remind that our new estimates stand at the top of the guidance for this fiscal year.

L-f-l adjustments

In our first approach we diversify from our base case by adjusting l-f-l growth for the next 2

years as pictured in the table below.

Wacc/Tg adjustments

Our second sensitivity approach, examines the upside and downside potential of the stock

given different levels of Rf and terminal growth.



Financials

Profit & Loss (mn eu) 2011/12a 2012/13a 2013/14a 2014/15a 2015/16e 2016/17e 2017/18e

Greece 412.2 413.7 425.6 437.9 432.1 440.7 449.5 %change -1.5% 0.4% 2.9% 2.9% -1.3% 2.0% 2.0% % of sales 83.4% 82.4% 78.6% 75.2% 70.1% 68.7% 67.9% Bulgaria 27.2 34.2 40.5 45.3 49.9 50.9 51.9 %change 37.0% 25.7% 18.5% 12.0% 10.0% 2.0% 2.0% % of sales 5.5% 6.8% 7.5% 7.8% 8.1% 7.9% 7.8% Cyprus 54.9 54.3 66.9 75.0 98.0 100.0 102.0 %change 5.9% -1.2% 23.3% 12.2% 30.7% 2.0% 2.0% % of sales 11.1% 10.8% 12.3% 12.9% 15.9% 15.6% 15.4% Romania

8.8 24.3 36.6 49.6 58.8

%change

0.0% 175.1% 50.8% 35.3% 18.7% % of sales 1.6% 4.2% 5.9% 7.7% 8.9%

Total Revenues 494.3 502.2 541.8 582.5 616.6 641.1 662.3 % change 0.9% 1.6% 7.9% 7.5% 5.8% 4.0% 3.3%

Gross Profit 263.0 262.8 287.8 309.7 315.0 328.0 340.5 % margin 53.2% 52.3% 53.1% 53.2% 51.1% 51.2% 51.4% % change 0.9% -0.1% 9.5% 7.6% 1.7% 4.1% 3.8%

EBIT 117.0 91.6 127.1 137.9 127.7 136.1 143.6

% change -2.3% -21.7% 38.8% 8.5% -7.4% 6.6% 5.5% % margin 23.7% 18.2% 23.5% 23.7% 20.7% 21.2% 21.7%

Greece 109.4 109.8 114.6 120.0 98.7 102.5 107.1 %change -4.0% 0.4% 4.4% 4.6% -17.7% 3.9% 4.5% % margin 26.5% 26.5% 26.9% 27.4% 22.8% 23.3% 23.8% % of EBITDA 81.4% 99.4% 78.3% 75.4% 66.3% 64.6% 63.9% Bulgaria 4.8 -18.0 5.7 7.3 10.7 13.3 15.2 %change 53.3% -472.4% -131.9% 27.9% 45.5% 24.9% 14.1% % margin 17.8% -52.6% 14.2% 16.2% 21.4% 26.2% 29.3% % of EBITDA 3.6% -16.3% 3.9% 4.6% 7.2% 8.4% 9.1%

Cyprus 20.6 18.6 22.6 25.2 31.7 32.4 33.0 %change 14.5% -9.5% 21.1% 11.9% 25.5% 2.1% 2.1% % margin 37.5% 34.3% 33.7% 33.6% 32.3% 32.3% 32.4% % of EBITDA 15.3% 16.9% 15.4% 15.9% 21.3% 20.4% 19.7% Romania

3.6 6.7 7.7 10.4 12.4

%change

0.0% 87.0% 15.6% 35.3% 18.7% % margin

40.3% 27.4% 21.0% 21.0% 21.0%

% of EBITDA

2.4% 4.2% 5.2% 6.6% 7.4%

Total EBITDA 134.5 110.5 146.5 159.2 148.7 158.6 167.7

% change -0.5% -17.8% 32.6% 8.7% -6.6% 6.6% 5.7% % margin 27.2% 22.0% 27.0% 27.3% 24.1% 24.7% 25.3%

Financials 2.4 3.6 2.7 1.7 2.5 3.8 5.2 % change 70.5% 47.6% -25.4% -38.0% 50.9% 50.3% 37.7%

Pre Tax Income 119.5 95.7 130.0 137.0 130.2 139.9 148.8

% change -1.5% -19.9% 35.8% 5.4% -4.9% 7.4% 6.4% % margin 24.2% 19.1% 24.0% 23.5% 21.1% 21.8% 22.5% Total Tax 22.2 21.7 28.7 32.1 34.7 36.7 38.8 % Effective tax rate 18.5% 22.7% 22.1% 23.4% 26.6% 26.3% 26.1%

Net Income 97.3 74.0 101.2 104.8 95.5 103.1 110.0

% change 2.9% -24.0% 36.9% 3.5% -8.9% 7.9% 6.7% % margin 19.7% 14.7% 18.7% 18.0% 15.5% 16.1% 16.6%

EPS 0.75 0.54 0.74 0.77 0.70 0.76 0.81

% change 2.9% -27.2% 36.8% 3.5% -8.9% 7.9% 6.7%



Balance Sheet (mn eu) 2011/12a 2012/13a 2013/14a 2014/15a 2015/16e 2016/17e 2017/18e

Cash 184.6 170.0 287.6 298.9 317.7 358.4 404.2

Inventories 180.5 176.0 186.2 197.8 223.1 236.2 250.0 Trade debtors and other Trading Receivables 18.6 23.7 30.7 15.5 23.7 25.1 26.2

Other Receivables 24.0 34.7 33.3 33.3 33.3 33.3 33.3

Other Current Assets 4.6 16.4 14.1 11.7 11.7 11.7 11.7

Current Assets 412.4 420.9 551.8 557.2 609.4 664.6 725.3

Tangible Assets 415.2 430.9 445.9 497.9 511.9 524.3 535.3

Investment Property 6.9 6.9 6.5 6.1 5.8 5.6 5.3

Investments in Subsidiaries 0.0 0.0 0.0 0.0 0.0 0.0 0.0

Other l/t Receivables 22.2 35.3 30.1 29.1 29.1 29.1 29.1

L/T Assets 444.3 473.1 482.4 533.1 546.8 559.0 569.6

Total Assets 856.7 894.0 1034.2 1090.3 1156.2 1223.6 1294.9

S/T debt 0.0 0.0 20.0 2.9 2.9 2.9 2.9 L/T debt payable in the subsequent year 1.9 148.0 1.4 0.0 0.0 0.0 0.0

Account Payables 56.0 52.4 52.2 51.4 55.2 55.6 55.3

Provisions 0.2 0.2 0.3 0.2 0.2 0.2 0.2

Current tax liabilities 21.8 21.7 38.6 40.0 40.0 40.0 40.0

Other Current liabilities 21.5 19.8 20.8 29.0 29.0 29.0 29.0

S/T liabilities 101.4 242.0 133.3 123.5 127.3 127.6 127.4

L/T Debt 152.0 1.4 143.7 143.9 143.9 143.9 143.9

Other long Term liabilities 0.3 0.0 0.1 13.0 13.0 13.0 13.0

Deferred tax liabilities 6.1 7.6 7.6 7.0 7.0 7.0 7.0

Liabilities for pension plans 4.0 3.9 4.7 5.8 5.8 5.8 5.8

L/T Liabilities 162.4 12.9 156.1 169.6 169.6 169.6 169.6

Share Capital 181.9 154.7 161.9 161.9 161.9 161.9 161.9

Share Premium 13.8 14.0 7.7 7.7 7.7 7.7 7.7 Currency translation adjustments -0.7 -0.7 -0.6 -0.9 -0.9 -0.9 -0.9

other reserves 194.3 267.7 339.5 361.6 361.6 361.6 361.6

Retained earnings 203.6 203.5 236.1 266.9 329.0 396.0 467.5

Equity 592.9 639.1 744.5 797.2 859.3 926.4 997.9

Minorities 0.0 0.0 0.0 0.0 0.0 0.0 0.0

Equity & Minorities 592.9 639.1 744.5 797.2 859.3 926.4 997.9

Total Liabilities 856.7 894.0 1033.9 1090.3 1156.2 1223.6 1294.9



Cash Flow( mn eu) 2011/12a 2012/13a 2013/14a 2014/15a 2015/16e 2016/17e 2017/18e

Net income 97.3 74.0 101.2 104.8 95.5 103.1 110.0 Plus: Depreciation & Amortization 17.4 18.9 19.4 21.2 21.0 22.5 24.1

Plus: Chng in Provisions 0.0 0.0 0.1 (0.1) 0.0 0.0 0.0

Plus: Chng in Taxes Payable (10.4) (0.1) 16.9 1.4 0.0 0.0 0.0

Plus: Minorities 0.0 0.0 0.0 0.0 0.0 0.0 0.0

Plus: non cash taxes 0.7 1.5 0.0 (0.7) 0.0 0.0 0.0

Gross Cash Flow 105.0 94.3 137.7 126.8 116.6 125.7 134.1

Plus: Chng in Acc Payable (2.2) (3.6) (0.1) (0.8) 3.8 0.4 (0.2) Plus: Chng in other current Liabilities 4.6 (1.8) 1.0 8.2 0.0 0.0 0.0

Less: Chng in Acc. Receivable (9.4) 5.1 7.0 (15.2) 8.1 1.4 1.1

Less: Other Receivable 2.3 23.8 (6.7) (1.0) 0.0 0.0 0.0

Less: Chng in Inventories 6.0 (4.5) 10.2 11.6 25.3 13.1 13.8

Working Capital Chng (3.5) 29.9 9.5 (11.9) 29.6 14.2 15.1

Operating Cash Flow 108.5 64.4 128.1 138.7 87.0 111.5 119.0 Less: Purchases of Fixed Assets 53.9 33.9 33.6 63.4 35.0 35.0 35.0

Less: Chng in Investments (0.7) (0.0) (5.8) (0.4) (0.3) (0.3) (0.3)

Free Cash Flow 55.2 30.5 100.4 75.7 52.2 76.8 84.3

Less: Dividends Paid 0.0 0.0 0.0 45.0 33.4 36.1 38.5

Plus: Equity Chng -27.4 -27.1 1.0 0.0 0.0 0.0 0.0

Plus: Debt Chng -1.8 -4.6 15.7 -18.3 0.0 0.0 0.0

Plus: Grants Chng 0.0 0.0 0.0 0.0 0.0 0.0 0.0

Less: Dividends to Minorities 0.0 0.0 0.0 0.0 0.0 0.0 0.0 Plus: Consolidation adjustments 0 -1 -3 0 0 0 0

Plus: Other 0.8 -12.1 3.2 -1.0 0.0 0.0 0.0

Chng in Cash Position 26.6 (14.7) 117.6 11.4 18.8 40.7 45.8

Cash Position 184.6 170.0 287.6 298.9 317.7 358.4 404.2


DISCLOSURE APPENDIX

ALPHA FINANCE INVESTMENT SERVICES S.A.

5 MERLIN STREET, GR – 106 71 ATHENS, www.alphafinance.gr

Customer Service: T +30-210-370 5700, F +30 210 370 5750, E-mail: [email protected] General Electronic Commercial Registry (G.E.MI.) Nr.:1176701000 Regulated by the Hellenic Capital Market Commission, License Nr. 42/13.04.1989

Analyst Certification The research analyst(s) undersigned and responsible for the preparation of this report certify (-ies) that a) the views expressed in this report accurately

reflect their (his/her) personal views about any and all of the securities or issuers mentioned in this report and b) no part of the analyst’s compensation

was, is, or will be, directly or indirectly related to the specific recommendations or views expressed in this research report. Analysts receive compensation

based upon various factors, including the quality and accuracy of research, productivity, experience, individual reputation, competitive factors and feedback

from clients.

Company specific regulatory disclosures

Disclosure checklist for companies mentioned & other price data information

Reuters Rating Price Price date/time Disclosure

Jumbo (Babyland) BABr.AT Neutral €9,75 Official close @ 25 November 2015 none Source: Alpha Finance 1. Alpha Finance and/or its affiliate(s) has acted as manager/co-manager/adviser in the underwriting or placement of securities of this company within the

past 12 months 2. Alpha Finance and/or its affiliate(s) has received compensation for investment banking services from this company within the past 12 months

3. Alpha Finance makes a market in the securities of this company

4. Alpha Finance and its affiliate(s) owns five percent or more of the total share capital of this company

5. The company and its affiliate(s) owns five percent or more of the total share capital of Alpha Finance and its affiliates

6. Alpha Finance has sent the research report to the company prior to publication for factual verification

7. Following 6, Alpha Finance has changed the contents of the initially sent research report, with respect to: no change

8. Alpha Finance has received compensation from the company for the preparation of this research report

Major changes vs. previous research reports

Date of report Price on report date (€) TP (€) Rating Forward1 EPS (€)

14/10/2015 8.19 9.3 Neutral 0.66

Source: Alpha Finance | 1: next year’s EPS used from December onwards Ratings and target price history

Price chart for Jumbo Rating history for Jumbo

DATE Rating Share Price (€) Price Target (€)

23/2/2012 Resume - neutral 3.70 4.34

9/4/2012 neutral 3.82 3.53

23/11/2012 neutral 5.11 5.00

27/2/2013 neutral 7.23 8.55

20/5/2013 neutral 7.95 8.20

9/10/2013 neutral 9.60 9.20

9/12/2013 outperform 11.20 13.80

7/3/2014 outperform 13.05 15.10

1/10/2014 outperform 10.35 13.00

8/12/2014 neutral 11.07 10.60

14/10/2015 neutral 8.19 9.30

26/11/2015 neutral 9.75 10.80

Regulatory disclosures This report has been prepared by Alpha Finance Investment Services S.A. (‘Alpha Finance’), a wholly owned subsidiary of Alpha Bank A.E. Alpha Finance is

regulated by the Hellenic Capital Markets Commission (HCMC). Alpha Finance has in effect management policies to identify and confront potential conflicts

of interest that could arise in the research division of the company and/or its affiliates (“Chinese Walls”).


Valuation method Our valuation for Jumbo is based on a DCF model. We use a WACC 10% with terminal growth rate at 2.5%. We use a risk free rate of 7%, a beta of 0.89 and equity risk premium of 5%.

Risk rating We rate Jumbo as medium risk based on the qualitative/ quantitative assessment of risk we apply on the company (see definitions of risk below). We consider the following the biggest investment risks for the shares: a) over-reliance to CEO b) timely execution of store rollout plan, c) worsening Greek Consumer environment, d) price pressures from suppliers, e) adverse currency changes, f) macroeconomic environment.

Definitions of Fundamental and Risk Ratings and Allocations

RISK RATING Low (L) Medium (M) High (H) Relative to Horizon2 Coverage3 IB services4

FU

ND

AM

EN

TA

L

RA

TIN

G

Outperform O/P TRP1 > +5% TRP1 > +15% ASE Index Dec.’11 10/50 10.0%

Neutral N (5%) < TRP1 < +5% 16/50 0.0%

Underperform U/P TRP1 < (5%) TRP1 < (15%) 4/50 0.0%

Restricted (G) R(G) Alpha Finance belongs to the same group of companies 1/50 0.0%

Restricted (IB) R (IB) Alpha Finance is currently rendering investment banking services 0/50 0.0%

Under review UR/ Not rated NR No rating currently available 19/50 0.0%

Source: Alpha Finance | Data as of 31.12.10 | 1: Total Return Potential (=capital return + dividend yield) | 2: except otherwise stated | 3: Percentage of companies under coverage within this category as of 31.12.10 | 4: Percentage of companies within this rating category for which investment banking services were provided over the past 12 months, as of 31.12.10. In several occasions, subject to the analyst's view and/or due to volatility of the shares, the ratings applied may fall out of the brackets described in the table above. The Alpha Finance universe consists of 50 companies accounting as of 31.12.10 for 79.9% of total market value

Risk ratings explained We derive the overall risk rating for a stock by applying a 60% weight on quantitative and a 40% weight on qualitative factors. We use a scale from 1 to 3

to describe ‘low, ‘medium’ and ‘high’ risk respectively. We compute two different quantitative risks namely liquidity and volatility. We assign equal weights

to liquidity and volatility risks to arrive at a so-called trading or quantitative risk for the specific stock researched. Using a scale of 1-to-3 scale, each

analyst also assigns a qualitative risk that is entirely up to his/her discretion to determine. Following this, we calculated the combined risk of the specific

stock applying the weights mentioned earlier. All IPOs are classified ‘high risk’ for 12 months after their listing date.

Definitions of Risk Ratings

Quant factor Definition Brackets Risk rating

Liquidity Number of shares traded over the last 12 months as % of total shares outstanding

If less than or equal to 33% High If greater than 33% but less than or equal to 66% Medium If greater than 66% Low

Volatility

The standard deviation of daily changes during the last 12 months. Volatility is used as a statistical measure of dispersion and indicates the propensity of a specific equity to suffer large swings in price. The stock’s volatility is measured against the volatility of the ASE index

If equity volatility against the market’s is greater than 2 High If equity volatility against the market’s is greater than 1.5 but less than or equal to 2

Medium

If equity volatility against the market’s is less than or equal to 1.5

Low

Source: Alpha Finance | Data as of 31.12.10 | The quant factors are updated at the end of each calendar quarter

General disclaimer This report has been prepared by Alpha Finance.

This report by no means provides investment advice as to any financial instruments contained herein. We aim to express our value judgments as to

possible or existing investments, without any existing contractual obligation to our clients. We cannot assume any liability for any investments undertaken

by our clients, since these investments will be a product of their own free will. The information contained in this report has been taken from sources,

which we deem to be reliable. We do not represent that such information is accurate or complete and it should not be relied upon as such. All opinions

and estimates expressed herein constitute our judgment as of this date and are subject to change without notice. Past performance is not indicative of

future results. The opinions and recommendations herein do not take into account individual client circumstances, objectives or needs. This report is

published solely for informational purposes and is not to be construed as a solicitation or an offer to buy or sell any securities or related financial

instruments.

© 2014 Alpha Finance. All rights reserved. This report may not be reproduced or redistributed, in whole or in part, without the written permission of Alpha

Finance and Alpha Finance accepts no liability whatsoever for the actions of third parties in this respect.


Alpha Finance Investment Services S.A.

Member of the AE, CSE 5 Merlin street, 106 71 Athens Greece

T +30-210-367 7400 F +30-210-331 1193 [email protected] www.alphafinance.gr

Equities Research Manousos Stathoudakis, Director Antonis Diapoulis Angelos Chorafas Nikos Katsenos Katia Zahari [email protected] T +30-210-367 7545

Sales & Trading Spyros Malavazos, Director Equities Sales | Foreign Institutions Natasa Martseki, Director Vassilis Galleos Ioannis Batistakis Equities Sales & Trading | Institutions Kostas Tzimos Maria Vryoni Giota Kouli Chris Xikis Derivatives Sales & Trading Lefteris Syrrakos, Director Andreas Markogiannis Angelos Kostis Stavros Tsimpos Equities Trading | Retail Andreas Tzevelekos, Head Maria Saranti

Market Making | Equities & Derivatives Andreas Papanayotopoulos, Director Stelios Tzaras International Markets | Sales & Trading Andreas Papanayotopoulos, Director Giannis Giouremos George Sarris Sofia Giannakou

Equities Sales | Retail Pantelis Tsitos, Director Kostantinos Kostoulas, Deputy Director Leonidas Kyriakopoulos Stavroula Galani Lazaros Koutromanos

[email protected]

mailto:[email protected]

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