Intelace
RETAIL MARKET IN POLAND :
TESCO - OVERVIEW
by Marcin Mazurek
Intelace Research
October 2005

TESCO - THE SECOND LARGEST INVESTOR IN RETAIL IN POLAND IS
DETERMINED TO STAY ON THE TOP
Top foreign investors in the retail Recent announcements
trade sector*, FDI in US$ millions
„With no doubt Poland is for Tesco the most important
Metro Group market in the Central and Eastern Europe ... largest
1 508
AG
investments will be focused on this market.... up to now we
Tesco Plc 1 300 have invested in Poland around PLN 5,5 billion, and we see
opportunities for further investments here.... „
Carrefour 980 Kevin Grace – CEO Tesco 2005
Retail Trade in Poland -2005
Casino 801
Auchan S.A. 672 „Now Tesco plans
development of medium-
„We will consider every
IKEA 600 sized or even smaller outlets
option to defend our
with sales space up to 1000
Jeronimo position and to increase
386
sqm.... In Poland there is a
Martins Holding share on the retail
room for 500 such outlets
market ....”
and that is what Tesco would
Kingfisher 104 like to do in the next 8-10
Wojciech Sokół –
spokesman Tesco, 2005
years...”
NETTO A/S 100
Press, 2005
Royal Ahold
59
N.V.
2
* Investments up to 31 Dec. 2004, Fuel distributors excluded
Source: PAIIZ, press Intelace Research

BOTH SALES REVENUE AND SALES AREA GROW QUICKLY, BUT
THERE IS NO PROGRESS IN TERMS OF SALES EFFICIENCY CAGR*
Group sales revenue**
EUR million
47,1 1 019
959
772
548
395
148
1999 2000 2001 2002 2003 2004 Sales per sqm.
Retail Trade in Poland -2005
`000 EUR
3,24 3,53
2,76 2,59
2,38 2,40
Group total sales space** 1999 2000 2001 2002 2003 2004
‘000 sqm.
44,8
394
322 348
In 2002 Tesco acquired
122 155 from German Dohle 13
62 „HIT” hypermarkets with
total sales space of
1999 2000 2001 2002 2003 2004 114,500 sqm
** Including Savia chain, share of Savia chain in sales revenue and sales space is 6% and 5% respectively 3
* Compound Annual Growth Rate
Source: Handel, press, NBP Intelace Research

TESCO HAS CURRENTLY* ALMOST 100 DIFFERENT OUTLETS IN
POLAND Current expansion focus
Outlets Details
44 • Large stores with sales space of
5,000–16,000 sqm.
• Located in major cities
Hypermarkets
• Present in sout-western part of the
7 country
• Plans for major rollout - next to
Retail Trade in Poland -2005
Large cities existing hypermarkets
Petrol stations
Tesco
Network 7 • Present in mid-size cities
• Average size 2,000-3,000 sqm
• Currently priority format to develop
Mini-hypermarket
31 • Regional chain of stores with sales
area < 650 sqm. located in southern
Poland
• No expansion plans, likely to be
Savia supermarket
replaced by Tesco brand
Mid-size • Regional chain of small stores
towns
9
~650 sqm. Present in southern
Poland
Julius Meinl • To be replaced by Tesco brand
4
* as of October 2005
total 98
Source: press, Tesco Intelace Research

FORMAT OVERVIEW: HYPERMARKETS
• 44 Tesco hypermarkets Hypermarkets
Mini-Hypermarkets
Network • 7 Tesco mini-hypermarkets Distribution centre
size* • Focus on south-western Poland
•Two large central warehouses • Gdynia
close to Warsaw • Gdańsk
• Average hypermarket size • Szczecin
Size and 8,400 sqm. • Olsztyn
space •Typical mini-hypermarket size
Retail Trade in Poland -2005
• Bydgoszcz
2,000 sqm. • Gorzów
Wielkopolski
• Hypermarkets: 40,000 – • Poznań
• Warszawa
Assort- 50,000 SKUs of which ~3,000
• Kalisz • Łuków
ment private label brands • Łódź
• Mini-hypermarkets 10,000 –
• Lubin
12,000 SKUs • Jelenia
• Wrocław • Kielce
Góra • Częstochowa • Lublin
• Opole
• Legacy network structure after take-
• Katowice • Mielec
Issues to over of German HIT: • Kraków • Rzeszów
consider - Overrepresentation: Kalisz, Gorzów
- Under-representation: Warsaw
- No presence: Radom, Białystok
5
* as of October 2005
Source: press, Tesco Intelace Research

FORMAT OVERVIEW: FUEL STATIONS
• 7 stations across Poland Petrol stations
Network • Typically located next to
size* Hypermarket
• Gdynia
• Gdańsk
• Advertised as chepaest station
Price/Pro in the area (guaranteed in 3km • Szczecin
• Olsztyn
motion radius)
Retail Trade in Poland -2005
• Bydgoszcz
• Gorzów
Wielkopolski
• Poznań
• Full offer: 95, 98, ON, LPG • Warszawa
Assort-
• Kalisz • Łuków
ment • Łódź
• Lubin
• Jelenia
Góra • Kielce
• Wrocław • Częstochowa • Lublin
• Network still very limited • Opole
Issues • Plans to open multiple new • Katowice • Mielec
outlets in 2005/2006 • Kraków • Rzeszów
6
* as of October 2005
Source: press, Tesco Intelace Research

FORMAT OVERVIEW: SUPERMARKETS
• 31 stores under „Savia” brand Savia
Major Market
Network • 9 Major Market (acquired in 2005
size* from Julius Meinl)
• Chains sourced from 6
• Gdynia
warehouses • Gdańsk
• Average supermarket size
Size and 600-800 sqm. • Szczecin
• Olsztyn
space
Retail Trade in Poland -2005
• Bydgoszcz
• Gorzów
Wielkopolski
• Poznań
• Savia ~10,000 SKUs • Warszawa
Assort-
• Major Market ~6,000 SKUs • Kalisz • Łuków
ment • Łódź
• Lubin
• • Kielce
• Wrocław • Częstochowa • Lublin
• Savia stores likely to be converted to Jelenia
• Opole
Góra
Issues Tesco brand in the medium-term
• Katowice • Mielec
perspective • Kraków • Rzeszów
• Newly acquired stores need to be
quickly adapted an re-branded
7
* as of October 2005
Source: press, Tesco Intelace Research

THE END
Retail Trade in Poland -2005
. THE END .
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