Winn-DixieStoresIncBankofAmerica2008ConsumerConference

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Winn-DixieStoresIncBankofAmerica2008ConsumerConference

  1. 1. PETER LYNCH CHAIRMAN, CEO & PRESIDENT WINN-DIXIE STORES, INC. BANK OF AMERICA 2008 CONSUMER CONFERENCE March 11, 2008 FRESH & LOCAL
  2. 2. SAFE HARBOR STATEMENT <ul><li>Certain statements made in this presentation may constitute “forward-looking statements” within the meaning of the federal securities laws. These forward-looking statements are based on our current plans and expectations and involve certain risks and uncertainties. Actual results may differ materially from the expected results described in the forward-looking statements. These forward-looking statements include and may be indicated by words or phrases such as “anticipate,” “estimate,” “plan,” “expect,” “project,” “continuing,” “ongoing,” “should,” “will,” “believe,” or “intend” and similar words and phrases. There are many factors that could cause the Company’s actual results to differ materially from the expected results contemplated or implied by the Company’s forward-looking statements. The Company faces a number of risks and uncertainties with respect to its continuing business operations and its attempt to increase its sales and gross profit margin, including, but not limited to: the Company’s ability to improve the quality of its stores and products; the Company’s success in achieving increased customer count and sales in remodeled and other stores; the results of the Company’s efforts to revitalize the corporate brand; competitive factors, which could include new store openings, price reduction programs and marketing strategies from other food and/or drug retail chains, supercenters and non-traditional competitors; the ability of the Company to effectively manage gross margin rates; the ability of the Company to attract, train and retain key leadership; the Company’s ability to implement, maintain or upgrade information technology systems, including programs to support retail pricing policies; the outcome of the Company’s programs to control or reduce operating and administrative expenses and to control inventory shrink; increases in utility rates or gasoline costs, which could impact consumer spending and buying habits and the cost of doing business; the availability and terms of capital resources and financing and its adequacy for the Company’s planned investment in store remodeling and other activities; the concentration of the Company’s locations in the southeastern United States, which increases its vulnerability to severe storm damage; general business and economic conditions in the southeastern United States, including consumer spending levels, population, employment and job re-growth in some of our markets, and the additional risks relating to limitations on insurance coverage following the catastrophic storms in recent years; the Company’s ability to successfully estimate self-insurance liabilities; changes in laws and other regulations affecting the Company’s business; events that give rise to actual or potential food contamination, drug contamination or food-borne illness; the Company’s ability to use net operating loss carryforwards under the federal tax laws; and the outcome of litigation or legal proceedings. Please refer to discussions of these and other factors in the Company’s Annual Report on Form 10-K for the fiscal year ended June 27, 2007, and other Company filings with the Securities and Exchange Commission. These statements are based on current expectations and speak only as of the date of such statements. The Company undertakes no obligation to publicly revise or update these forward-looking statements, whether as a result of new information, future events or otherwise. </li></ul>
  3. 3. AGENDA <ul><li>Building a Strong Foundation </li></ul><ul><li>Current State </li></ul><ul><ul><li>Financial Highlights </li></ul></ul><ul><ul><li>Gaining Market Share </li></ul></ul><ul><ul><li>Store Remodel Program </li></ul></ul><ul><ul><li>Corporate Brands </li></ul></ul><ul><li>Neighborhood Marketing </li></ul><ul><li>Fiscal 2008 Financial Guidance </li></ul><ul><li>Summary </li></ul>
  4. 4. Building a Strong Foundation
  5. 5. STRONG FOUNDATION FOR FUTURE GROWTH <ul><li>Chapter 11 enabled the Company to streamline its store base </li></ul><ul><li>Achieved numerous operational improvements </li></ul><ul><li>Realigned retail organization with stronger focus on customer service, merchandising and marketing plans </li></ul><ul><li>Assembled experienced and committed leadership team to execute our turnaround plan </li></ul><ul><li>Energized 52,000 Associates who are committed to “Getting better all the time.” </li></ul>
  6. 6. FINANCIAL HIGHLIGHTS SINCE EMERGENCE <ul><li>Balancing sales and gross margins - achieve profitable sales </li></ul><ul><li>Four consecutive quarters of 100 basis points or more of year-over-year gross margin improvement </li></ul><ul><li>Positive Adjusted EBITDA </li></ul><ul><li>Increasing sales per square foot </li></ul>(1)Please refer to footnote (one) of our financial statements for the quarterly period ended January 9, 2008 for disclosure regarding successor versus predecessor financial statements. (2)Gross margin for the last four quarters includes ~ $6 million of favorable development of prior years insurance claims, primarily related to workers’ compensation.
  7. 7. Current State
  8. 8. 2008 YTD FINANCIAL HIGHLIGHTS <ul><li>Gross margin of 27.0%, an increase of 100 basis points compared to prior fiscal year </li></ul><ul><li>Adjusted EBITDA of $41.1 million, an increase of $51.6 million compared to the prior fiscal year </li></ul><ul><li>As of January 9, 2008, the Company had $588 million of liquidity </li></ul>
  9. 9. GAINING MARKET SHARE Source: March 2008, The Shelby Report
  10. 10. STORE REMODEL PROGRAM <ul><li>Offensive remodels experienced a 12% weighted average sales lift following the grand re-opening </li></ul><ul><ul><li>Transaction count increased 5.2% </li></ul></ul><ul><ul><li>Basket size increased 6.8% </li></ul></ul><ul><ul><li>Mix shift from non-perishables to perishables of 200 basis points </li></ul></ul><ul><li>18% of store base remodeled by the end of FY08 </li></ul><ul><li>Expect to complete approximately 50% of store base by the end of FY2010 </li></ul>
  11. 15. Rebuilding Trust in Our Brand <ul><li>“ Good” product line that matches the national and regional “value” brands in quality. </li></ul>Reinventing Winn-Dixie brand through three tiers of quality products that offer better value and selection “ Better” product line designed to be equal to or better than the comparable national or regional brand category leader. “ Best” product line for premium tier products.
  12. 17. CORPORATE BRANDS (1) <ul><li>Current penetration of 20.6% FY08 YTD </li></ul><ul><li>Approaching $1B in annual sales </li></ul><ul><li>On target to have 1,500 SKUs redesigned by end of FY08 </li></ul><ul><li>Winn-Dixie perfectly positioned for shift in consumer spending </li></ul>1 Corporate Brands penetration rate based on the categories measured by Winn-Dixie.
  13. 18. NEIGHBORHOOD MARKETING
  14. 19. VISION AND MISSION <ul><li>To be the leading neighborhood grocer aligning our merchandising, marketing and operations to the communities we serve, especially: </li></ul><ul><li>Hispanic </li></ul><ul><li>Urban </li></ul><ul><li>Affluent </li></ul><ul><li>Kosher </li></ul><ul><li>Resort </li></ul>
  15. 20. HISPANIC
  16. 21. URBAN
  17. 22. AFFLUENT
  18. 23. KOSHER
  19. 24. RESORT
  20. 25. FISCAL 2008 FINANCIAL GUIDANCE
  21. 26. <ul><li>Adjusted EBITDA now expected to range between $105 - $125 million </li></ul><ul><li>Gross margin for the second half of FY08 expected to be equal to second half of FY07 </li></ul><ul><li>Expect to achieve a year-over-year improvement in identical store sales in the second half of FY08 </li></ul>FISCAL 2008 FINANCIAL GUIDANCE
  22. 27. SUMMARY <ul><li>Solid foundation for future growth </li></ul><ul><li>Strategic initiatives are on plan </li></ul><ul><li>Experienced and committed leadership team </li></ul><ul><li>Achieving profitable sales </li></ul>
  23. 28. PETER LYNCH CHAIRMAN, CEO & PRESIDENT WINN-DIXIE STORES, INC. BANK OF AMERICA 2008 CONSUMER CONFERENCE March 11, 2008 FRESH & LOCAL
  24. 29. Appendix <ul><li>Reconciliation of Net Income to Adjusted EBITDA </li></ul>
  25. 30. RECONCILIATION OF NET INCOME TO ADJUSTED EBITDA (1)Please refer to footnote (one) of our financial statements for the quarterly period ended January 9, 2008 for disclosure regarding successor versus predecessor financial statements.

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