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GUS plc January 2 0 0 6 Frankfurt/Paris Transforming GUS EBI T* - PDF document

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GUS plc January 2 0 0 6 Frankfurt/Paris Transforming GUS EBI T* Pro form a EBI T* 5 1 9 m 7 4 0 m Hom e shopping Property 7 % 6% ARG Finance 5 % 3 0 % Experian ARG Lew is 9 % 5 0 % 5 0 % 4 % Burberry 3 9 % Experian

  1. GUS plc January 2 0 0 6 Frankfurt/Paris

  2. Transforming GUS EBI T* Pro form a EBI T* £ 5 1 9 m £ 7 4 0 m Hom e shopping Property 7 % 6% ARG Finance 5 % 3 0 % Experian ARG Lew is 9 % 5 0 % 5 0 % 4 % Burberry 3 9 % Experian Year to March 2 0 0 0 Year to Septem ber 2 0 0 5 * Before central activities; 2005 excludes £34.5m of ARG one-offs 1 Transforming GUS • Shareholder value to be enhanced further by separation of ARG, Experian and Burberry – at a time and in a manner that benefits our businesses and causes minimum disruption • Sold remaining 50% stake in Lewis in May 2005 • Demerged Burberry in December 2005 • ARG and Experian – At appropriate time, seek separation – At this stage, both businesses will continue to benefit from further investment and support as part of GUS 2

  3. Q3 Trading Update Q3 % sales growth year-on-year Argos - total 9 - like-for-like 0 Homebase - total 1 - like-for-like (3) Experian* - Global 20 - North America 31 - International 8 * Continuing activities only; at constant exchange rates 3

  4. Argos Retail Group Argos Retail Group – overview EBI T* • Leading UK general Financial merchandise retailer Services • Multi-brand, multi-channel Hom ebase Argos • Supported by central infrastructure, where 22% appropriate 77% Year to Septem ber 2 0 0 5 £ 3 7 1 m * Excludes £34.5m of one-offs 6

  5. ARG – difficult market background LFLs falling in non-food, • Weak UK retail demand non-clothing m arket • Retailers facing higher cost % inflation 5 • ARG planning on assumption that like-for-like sales in non-food, non-clothing market 0 will decline for much of 2006 • ARG continuing to invest to strengthen long-term competitive position FY03 FY04 FY05 -5 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Market growth Source: GUS estimates 7 Argos • More than two-thirds of UK households collect a catalogue from store • Currently 650 stores • 98% of the UK population live within 10 miles of a store • 6% of sales ordered via Internet* • Further 13% via Check and Reserve* • 17,200 products in catalogue (SS06) • Market leader in many product categories • Low cost operator • Value retailer * Oct to Dec 2005 8

  6. Argos – growth initiatives Improve choice • Launched Argos Extra in all stores • Increase direct importing Improve value • Drive cost productivity/ efficiencies • Grow Argos Direct • Open more stores, including Index refits Improve convenience • Improve multi-channel services, including Check and Reserve 9 Argos Extra • First trial in January 2003 • Offers 17,200 lines with extended ranges in leisure, home and electrical • From July 2005, Argos Extra ranges available in all stores – c. 180 stores stocked-in – Rest are order-in • Expected to increase sales by 2-3% in first full year 10

  7. Argos – new stores • 33 Index stores refitted and reopened on plan • Opening c. 35 new stores a year • Plan for about 750 stores by March 2009 • Return on capital on new stores exceeds hurdle rate 11 Homebase • Number two DIY brand in UK • High brand awareness – ABC1 customers – Female shoppers • 297 stores, biased to South East • Become the leading UK home enhancement retailer • Cautious short-term industry outlook 12

  8. Homebase – growth initiatives • Homebase Way • Range reviews Improve customer offer • New ad campaign • Improve service and standards • Improve stock availability • New stores Increase new space • Mezzanine roll-out • Joint sourcing • Furniture Extra and Appliances Extra Leverage ARG scale • Transactional website • Financial Services 13

  9. Experian Experian - overview • Sales of £1.5bn and EBIT of £369m in 12 months to September 2005; highly cash generative • Largest global information solutions company • No single competitor offers as many products and solutions • No single competitor operates successfully in so many countries • Experian has strong market positions and client relationships 16

  10. Experian – what we do e.g. consumer e.g. credit scoring credit databases Credit Credit I nform ation Solutions Outsourcing I nteractive Marketing Marketing e.g. marketing e.g. database e.g. cheque e.g. online lead databases management processing generation 17 Experian – balanced portfolio North I nternational Am erica 4 2 % 5 8 % I nteractive I nteractive 1 9 % 1 9 % Outsourcing Outsourcing I nform ation Credit 8 % 8 % 4 2 % 4 9 % Solutions Marketing 3 1 % 2 4 % Sales – six months to September 2005 Continuing activities 18

  11. Experian – broad offering % of sales by vertical m arket • Over 50,000 clients in more than 60 countries Other 6% Publishing/ media 2% Financial Government 3% • Top 10 clients account for about services Automotive 3% 53% 25% of sales Telecom/ utilities/ insurance 8% • At least 85% of top 50 clients dealt with Experian for over five Direct-to- years consumer 12% Clients include: Retail/ • AOL Time Warner • MBNA home shopping • BNP Paribas • McDonald’s 13% • Barclays • Microsoft • Citigroup • Morgan Stanley Year to March 2 0 0 5 • Ford • Orange • HBOS • Société Générale 19 Experian – building shareholder value Sales* EBI T* £ m £ m 9 4 9 1 ,0 1 8 1 ,1 1 5 1 ,2 0 1 1 ,2 8 6 1 ,3 6 2 8 0 8 2 0 1 2 1 7 2 2 4 2 5 6 2 8 2 3 1 7 2 0 0 + 1 6 % + 1 8 % + 2 0 % + 1 4 % + 2 0 % + 1 2 % + 5 % + 3 % + 2 % + 3 % + 3 6 % + 2 9 % 2000 2001 2002 2003 2004 2005 H1 06 2000 2001 2002 2003 2004 2005 H1 06 Year to March Year to March 2005 onwards under IFRS * Growth rates at constant currency and from 2004 for continuing activities only 20

  12. Experian - key growth drivers • Growth in direct-to-consumer market and online advertising • Increase in consumer credit and card usage • Move to multi-channel marketing • Growth in fraud prevention • Growth in demand for information in new sectors, e.g. automotive, insurance, business-to-business, government • Growth in emerging markets 21 Experian Interactive Credit reports and Online monitoring services lead generation 22

  13. Experian Interactive • High growth markets Online advertising spend to • Strong market position grow rapidly $bn • Scale gives strong advertising 25 presence on Internet 1 8 % CAGR ‘0 4 to ‘0 9 20 • Synergies across Interactive and Experian 15 • Internationally scaleable 10 5 0 05e 06e 07e 08e 09e 00 01 02 03 04 Year Source: eMarketer 23 Experian – emerging markets • Establishing country management teams • Developing credit bureaux in Russia, Bulgaria and Romania • Growing decision solutions in Korea – Six of top seven banks are clients – About 70% of all consumer credit decisions made via Experian solutions – Selling value-added products through leading credit bureau • First major win in Japan • In Russia, now working with six of top 15 banks following credit bureau launch in April 2005 24

  14. Experian – acquisition strategy • Organic growth accelerated in last four years • Acquisitions are key part of growth strategy • Often small; always complementary; bringing – Data – New products – Geographical expansion – Vertical market expansion – Consolidation • Must generate double-digit post-tax returns over time 25 GUS - summary • Further strategic and operational progress • Focusing on fewer activities • Board committed to separation of ARG and Experian • Continue to drive sustainable growth in ARG and Experian 26

  15. Appendix Sales by division I m pact of 2 0 0 5 2 0 0 4 exchange 12 months to 31 March £ m £ m rate £ m Argos Retail Group 5,313 4,927 - Experian 1,362 1,286 (69) Central activities - 6 - Inter-divisional sales (12) (11) - Total continuing operations 6 ,6 6 3 6 ,2 0 8 ( 6 9 ) Burberry 715 676 (24) Discontinued operations* 409 664 6 Total sales 7 ,7 8 7 7 ,5 4 8 ( 8 7 ) * Consists of Lewis (2005: £187m, 2004: £160m), Wehkamp (2005: £222m, 2004: £235m) and Home shopping and Reality (2005: nil, 2004: £269m) 28

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