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Lehman Brothers Retail Seminar
- 1. Continuing Our Growth Through Customer Centricity Best Buy Co., Inc. Lehman Brothers Retail Seminar May 2, 2006 1
- 2. BRAD ANDERSON Vice Chairman and Chief Executive Officer 2
- 3. Our Journey Fiscal 2006 Before Fiscal 2007 Customer Centricity 3
- 4. Customer Centricity Unique Customers Full Engaged Solutions Employees 4
- 5. DARREN JACKSON Executive Vice President – Finance and Chief Financial Officer 5
- 6. The Market Leader Total U.S. Market Share 20.0% 18%18% 18.0% 16.0% 14%14% 14.0% 12.0% 10.0% 7% 7% 8.0% 6% 6.0% 6% Today 4.0% 941 stores 3%3% 2.0% Future 1,200+ stores 0.0% 1999 2001 2003 2005 1999 2001 2003 2005 Best Buy U.S. Market Share - Products Best Buy Canada Market Share 25% 21% 20% 18% 15% 13% 11% 11% 5% 6% Canadian Market Share = 30% Total CE Computing/ Music/ Movies Appliances Dig. Imag. 2001 Market Share 2005 Market Share 6
- 7. History of Growth Revenue Growth ($ in billions) •Growing profitably owth r n d ed g mpou % Co $30.8 15 •Investing for $27.5 $24.5 $20.9 $17.7 continued growth •Building tools and FY02 FY03 FY04 FY05 FY06 capabilities EPS1 h rowt •Expanding into new ed g oun d $2.27 omp 5% C 2 $1.75 markets $1.44 $1.11 $1.07 FY02 FY03 FY04 FY05 FY06 FY02 FY03 FY04 FY05 FY06 1Pro-forma adjusted for FAS 123 expense 7
- 8. New Growth Drivers $350 $100 New Market Growth •Expanding in new $80 markets: China $50 $120 Small – Services Businesses Services – Small Businesses North Potential American Market – China CE Market 7.0% Operating Income •Optimizing our profit New Stores, model is #1 priority IT Customer Centricity, Supply 5.3% Services Chain Best Buy Canada Goal Fiscal 2006 8
- 9. Our Advantage Unique Customers Full Engaged Solutions Employees 9
- 10. Our Priorities Customer Centricity Enhance the Transform the Core Extend the Business Customer Experience • Integrated customer- centric operating model Stores Corp. Field Campus Org. This chart contains forward looking information. Please see the company’s filings with the SEC 10 regarding the risks and uncertainties related to forward looking information.
- 11. Our Priorities Customer Centricity Enhance the Transform the Core Extend the Business Customer Experience • Integrated customer- • Services capabilities (Geek Squad & Home centric operating Theater) model • Full-solution offerings Stores • New stores and extended Magnolia Home Theater Corp. Field Campus Org. experience This chart contains forward looking information. Please see the company’s filings with the SEC 11 regarding the risks and uncertainties related to forward looking information.
- 12. Our Priorities Customer Centricity Enhance the Transform the Core Extend the Business Customer Experience • Integrated customer • Services capabilities • Pacific Sales (Geek Squad & Home Kitchen and Bath centric operating Theater) Centers model • Full-solution offerings • Best Buy For Business Stores • New stores and extended Magnolia • China Home Theater Corp. Field experience Org. This chart contains forward looking information. Please see the company’s filings with the SEC 12 regarding the risks and uncertainties related to forward looking information.
- 13. Our Growth Strategy $350 $100 New Market Growth $80 China $50 $120 Small Businesses Top-Line Services Growth Unique North Potential Customers American Market CE Market 7.0% Operating Income Bottom-Line Profitability New Stores, IT Full Engaged Customer Centricity, Solutions Employees Supply 5.3% Services Chain Best Buy Canada Goal Fiscal 2006 Capabilities 13
- 14. Safe Harbor Cautionary Statement Pursuant to the Private Securities Litigation Reform Act of 1995 This presentation may contain forward-looking statements, which are subject to risk and uncertainty. A variety of factors could cause our actual results to differ materially from the anticipated results expressed in such forward-looking statements, including, among other things, factors listed in our Current Report on Form 8-K filed with the SEC on 3/18/04. That 8-K describes additional factors that could cause actual results to differ materially from those contemplated by the forward-looking statements made in this presentation. 14
- 15. Continuing Our Growth Through Customer Centricity Best Buy Co., Inc. Lehman Brothers Retail Seminar May 2, 2006 15