GREECE | EQUITY RESEARCH | RETAIL 12.50 12

GREECE | EQUITY RESEARCH | RETAIL October 17, 2016

Recommendation BUY Target Price €15.00 Prior Target Price €14.60

Closing Price (14/10) €11.94

Market Cap (mn) €1,624.6

Expected Return 25.6%

Expected Dividend 2.5%

Expected Total Return 28.1%

Jumbo Share Price

7.50

8.00

8.50

9.00

9.50

10.00

10.50

11.00

11.50

12.00

12.50

Oct-15 Jan-16 Apr-16 Jul-16 Oct-16

Stock Data

Reuters RIC BABr.AT

Bloomberg Code BELA GA

52 Week High (adj.) €12.32

52 Week Low (adj.) €8.15

Abs. performance (1m) 8.4%

Abs. performance (YTD) 23.1%

Number of shares 136.1mn

Avg Trading Volume (qrt) 108.7k

Est. 3yr EPS CAGR 9.8%

Free Float 73%

Analyst

Stamatis Draziotis, CFA

Research Analyst

Tel: +30 210 37 20 259 E-mail: [email protected] Head of Research Tel: +30 210 37 20 257 Sales

Tel: +30 210 37 20 119 Trading

Tel: +30 210 37 20 168 / 110

See Appendix for Analyst Certification and important disclosures

JUMBO

Instilling confidence

Successfully navigating the tough macro… – Jumbo posted a robust end to FY’16 growing H2’16 sales (calendar H1’16) +10%. Domestic sales increased c7% in the same period, quite an impressive performance especially in the context of the tough macro (non-food retail sales -2.7%). Q1’17 has seen even stronger top line performance at group level (+11.5%), with Greece up c4%. Although mgt revealed that domestic run-rates have turned negative since mid September, we would not rush to extrapolate this trend in the remainder of the year. In our view, improving macro (IMF forecasting GDP +0.7% in Q4’16) and the low-ticket nature of the product offering will help Jumbo sustain mid-single digit growth in Greece paving the way for group sales growth of 7.8% in FY’17, ahead of mgt’s guidance (4-7%).

Flat profit guidance too conservative in our view – Mgt’s FY17 budget calls for flattish profits yoy as it expects deflationary trends in Greece to weigh on gross margins and as the benefit from falling freight rates has tailed off. Our view is that deflationary pressures are likely to be at least partly offset by the ongoing improvement in product mix, since seasonal/home products continue to enjoy stronger growth (+12% in FY16) than the other lower-margin categories. On our estimates, were we to assume that seasonal/home products increase c7% in FY17 (high-end of mgt guidance) while other products remain flat (so that group sales growth ends up at the low-end of the guided range), gross margins would increase by c40bps (ceteris paribus). In addition, China’s efforts to boost its economy are likely to continue weighing on the renminbi, thus providing support to Jumbo’s gross margin. Overall, our new forecasts still call for mid single-digit net profit growth in FY17 (c2% above consensus) and c12% in FY18 (c6% above consensus).

High quality of earnings, rising cash returns – In our view, the salient point about the investment case is the limited history of estimate downgrades and the quality of earnings. The former instills confidence that mgt can pull the necessary levers to sustain at least mid to high single-digit EBITDA growth. The latter is manifested in the consistent cash conversion and the increasing accumulation of cash (net cash cEUR260m as of end June ’16). With FCF set to exceed EUR350m over the next 3 years on our estimates, there is plenty of scope for additional returns to shareholders besides the ordinary dividend payout (c33%) mgt has committed to.

Valuation – Jumbo’s price is c17% below peak but in terms of valuation the discount vs. the recent peak is even more pronounced (>35%). We still base our PT on a blended methodology (DCF and target multiples), effectively placing the stock at c15x CY2017e PE, which would still translate to a c15% discount to the current valuation of EU retailers. We keep Jumbo in our top picks list.

COMPANY UPDATE

Estimates

EUR mn 2015a 2016a 2017e 2018e 2019e Revenues 582.5 637.6 687.0 732.0 775.0 EBITDA - adj. 159.3 183.7 195.1 212.7 229.9 Net profit - reported 104.9 121.3 128.5 143.5 158.4 Net profit - adj. 106.9 119.6 128.5 143.5 158.4 EPS - adj. 0.79 0.88 0.94 1.05 1.16 DPS 0.18 0.54 0.29 0.33 0.36

Valuation (Calendar Year) 2015a 2016a 2017e 2018e 2019e P/E 10.1 13.0 11.9 10.7 9.8 EV/EBITDA 5.8 7.2 6.6 5.6 4.8 EBIT/Interest expense NM NM NM NM NM Dividend Yield 2.1% 4.5% 2.5% 2.7% 3.0% ROE 13.9% 13.8% 13.8% 14.0% 13.8%

Note: Financial year ends in June

JUMBO

October 17, 2016

2

Contents

Investment case .............................................................................................................................................................................................. 3

Valuation ......................................................................................................................................................................................................... 4

FY17 outlook ................................................................................................................................................................................................... 6

1) Top line ........................................................................................................................................................................................................ 6

2) Costs ............................................................................................................................................................................................................ 9

Estimates ....................................................................................................................................................................................................... 11

Consistently outperforming guidance… ......................................................................................................................................................... 12

FY’16 results overview ................................................................................................................................................................................... 13

Feedback from the analyst meeting ............................................................................................................................................................... 14

Interim results and divisional breakdown ...................................................................................................................................................... 15

Brief company description ............................................................................................................................................................................. 16

Risks and sensitivities .................................................................................................................................................................................... 16

Group Financial Statements ........................................................................................................................................................................... 17

JUMBO

October 17, 2016

3

Investment case

With c72% of sales stemming from Greece, Jumbo’s growth profile is primarily dependent on the domestic consumer. Return of Greece to positive LFL (sales per store c+10% in calendar H1’16) and further share gains in a fragmented market ought to help Jumbo’s Greek sales grow in the mid-single digits. Romania, Cyprus and Bulgaria are additional growth levers, but will not account for more than c32% of the sales mix in the foreseeable future on our numbers. Assuming domestic sales per store grow 3-4% in the coming years, our estimate for c6% group sales CAGR through to 2021 looks well underpinned. On the cost side, deflationary pressures are weighing on gross margins but are likely to be at least partly offset by positive product mix in FY17 (faster growth of higher-margin home/seasonal products) and tight operating cost control. FX and transport costs feature as side winds at this stage. Overall, we believe that Jumbo is on track to deliver mid to high-single digit EBITDA growth over the coming years, translating to EPS CAGR close to 10% over 2017-19e.

Jumbo’s cash generating track record is impressive (OCF consistently greater than 60-65% of EBITDA). With EBITDA ranging between EUR195m and EUR230m over 2017-19e, we estimate Jumbo’s FCF is set to surpass EUR140m post FY18 as capex trends down below EUR30m (assuming 1 new store per annum). Mgt has committed to continue distributing one third of profits as ordinary dividend, which would point to DPS EUR0.30-0.40 per share in the coming years, on our numbers. That being said, there is clearly scope for further returns to shareholders in the form of special dividends, similar to the EUR0.27 per share distributed in Aug 2016 (to compensate investors for the zero distribution in the previous year).

Jumbo has significant property asset holdings, owning the freehold of around half of its outlets. The BV of Jumbo’s owned property assets (land and buildings) as of end June 2016 was cEUR457mn, namely close to 30% of the current market cap. With such a significant asset base and an under leveraged balance sheet, we believe that Jumbo has numerous options to extract value from its property portfolio at some point in the future (though this is not part of mgt’s near-term plans). In any case, the property-backing should provide valuation support to the stock even in periods of high risk attached to Greek equities.

Jumbo’s margins have demonstrated impressive resilience remaining broadly unchanged over FY14-16 despite deflationary pressures from fiscal consolidation in Greece and more expensive sourcing of goods as a result of the appreciation of the USD. Falling transport costs have been instrumental in protecting Jumbo’s profitability, as has been tight opex control (e.g. opex per store -1% in FY16). However, with the impact from lower freight rates now dissipating mgt guides for significant gross margin contraction in FY17. Our view is that the positive product mix (faster growth of home/seasonal products) will offset – at least partly –deflationary pressures helping Jumbo deliver mid single-digit EBITDA growth. Although our net profit forecast stands c6% above mgt’s guidance, we caution that mgt’s budget has in the past proved too pessimistic and that mgt’s main underlying assumption (Greek LFL ranging between slightly negative to slightly positive) is not in sync with the most recent GDP macroeconomic projections (e.g. IMF looking for GDP growth +0.7% as soon as calendar Q4’16).

Jumbo is c17% below its peak price, but on valuation terms (EV/EBITDA) the discount vs. the recent peak (in 2014) is even more pronounced (>35%). Jumbo also trades at c30% PE discount vs. EU retailers, despite offering a comparable (or in some cases superior) 3-year growth profile and a stronger balance sheet. On a cash adjusted basis, Jumbo is trading at <11x CY2017e PE, which represents quite an attractive entry point for long-term investors, we reckon. We still base our PT on a blended methodology (DCF and target multiples), effectively placing the stock at c15x CY2017e PE, not too demanding in our view given the long-term growth profile and short-term profit resilience.

Fundamental growth story…

…with scope for increasing

cash returns

… and resilient margins

… property backing

Valuation

JUMBO

October 17, 2016

4

Valuation

On our estimates, Jumbo is trading at c13x CY’16 PE and c7x EV/EBITDA. From a historical viewpoint, the latter represents a <10% premium to the average since 2007, which is more than justified in our view given Jumbo’s significantly stronger financial position and the successful track record of growing sales and profits in a recessionary environment. The chart on the right hand side shows that the EV implied by our price target of EUR15.0 per share is similar to Jumbo’s EV at the most recent peak in absolute terms (i.e. cEUR1.8 bn) but on >30% higher 1-year forward EBITDA.

Jumbo market cap (in EURmn) and PE (1-year forward) Jumbo EV (in EURmn) and EV/EBITDA (1-year forward)

Source: Bloomberg, Eurobank Equities Research

Jumbo does not really have any direct peers given the unique product mix. As a result, the following table is presented solely to put Jumbo’s valuation into some context. Compared to the broad European retail space, which currently trades at c8-9x EV/EBITDA, Jumbo currently stands at c20% discount (on 2017e) despite the fact that Jumbo offers a similar earnings growth profile and enjoys one of the strongest balance sheets among EU retailers.

Peer group PE EV/EBITDA Div. yield ROA EPS CAGR EBITDA CAGR Developed retail CY16e CY17e CY16e CY17e CY17e 2017e 3-year 3-year Mothercare 11.6x 9.8x 3.8x 3.7x 0% 5% 12% 7% WH Smith 15.8x 15.0x 9.9x 9.6x 3% 24% 4% 2% Debenhams 7.8x 8.1x 3.8x 3.9x 6% 4% 3% 3% Next 10.6x 10.4x 7.9x 8.0x 5% 26% 5% 6% M&S 10.4x 10.9x 5.5x 5.6x 7% 6% 0% 3% Casino 17.1x 12.9x 9.7x 8.6x 8% 1% 3% 1% Carrefour 14.1x 12.5x 6.6x 6.1x 4% 3% 10% 4% European Retail 20.2x 17.9x 8.8x 8.1x 3% 8% 11% 8% Jumbo 13.0x 11.9x 7.2x 6.6x 2% 11% 10% 8%

Emerging retail

We retain the same valuation methodology – namely a combination of DCF and target multiples – and have edged up only slightly our PT to EUR15 (from EUR14.60 previously) as we roll forward our valuation to Oct 2017. We summarise our methodology below. Our PT effectively places the stock at c15x CY2017e PE, still a c15% PE discount to EU retailers.

Target mcap

PE = 18

PE = 16

PE = 14

PE = 11

PE = 8

0

500

1,000

1,500

2,000

2,500

3,000

Oct-07 Oct-09 Oct-11 Oct-13 Oct-15 Oct-17 Oct-19

Target EV

EV/EBITDA = 12

EV/EBITDA = 10

EV/EBITDA = 8

EV/EBITDA = 6

EV/EBITDA = 3

Current EV

0

500

1,000

1,500

2,000

2,500

3,000

Oct-07 Oct-09 Oct-11 Oct-13 Oct-15 Oct-17 Oct-19

Our PT values Jumbo at recent

peak EV but on >30% higher

forecast EBITDA

JUMBO

October 17, 2016

5

Jumbo valuation EURmn comment EV/EBITDA EBITDA 2017e 195

Multiple 8.0x Small discount vs. EU retailers Target EV (mid 2017e) 1,561 Minus adj. net debt (plus net cash) – 2017e (270) Equity value – mid 2017e 1,831 12-month equity fair value 1,884 Number of shares (mn) 136 12-month equity fair value (EUR) 13.8 €

PE

EPS 2017e (EUR) 0.94

Multiple 16.0x Small discount vs. EU retailers 2017e fair price 15.1

12-month equity fair value (EUR) 15.5 €

DCF

PV of FCF 1,896 See below Minus adj. net debt (plus net cash) (259) Equity Value 2,155 12-month equity fair value 2,142 Number of shares (mn) 136 DCF fair-value per share (EUR) 15.7 €

12-month Price Target 15.0 €

Source: Eurobank Equities Research

Below we present an overview of our DCF methodology. This is predicated on a 10% WACC, medium term EBIT CAGR of 4.7% and long-term growth rate of 1%. It still incorporates sustainable NOPAT margins of c18% from c19.6% in 2019e, as we expect gross margins to fade towards c50% (albeit still above management’s long-term guidance of 48%). Our DCF assumes cash conversion (OCF/EBITDA) of c75% in the medium term, in sync with levels delivered in the recent past. A summary of our DCF can be seen below:

Jumbo DCF valuation EURmn (FY to end June) 2017 2018 2019 2020 2021 2022 2023 2024 … 2028 NOPAT 126.7 139.6 151.6 160.8 170.0 178.4 194.7 196.6 … 188.3 NOPAT margin 18.4% 19.1% 19.6% 19.7% 19.9% 19.9% 20.7% 20.0% … 17.8% Depreciation 23.2 24.3 25.0 25.6 26.2 27.5 30.0 30.3 … 29.0 Working Capital change (increase) (17.2) (5.1) (4.6) (3.7) (3.9) (6.0) (6.0) (6.0) … (6.0) Capex (49.5) (23.5) (23.0) (22.5) (22.0) (26.1) (30.0) (30.3) … (29.0) Unlevered FCF (UNFCF) 83.2 135.3 149.0 160.2 170.3 173.8 188.7 190.6 … 182.3 PV of UNFCF 83.2 123.0 123.2 120.4 116.3 107.9 106.5 97.8 … 63.9 Sum of PV of UNFCF 1,186.6 PV of TV 709.8 Enterprise Value 1,896.4 Net cash (debt) – 2016 258.5 Equity value 2,155.0 Number of shares (mn) 136.1 Value per share (FY end) 15.8 € 16.6 € 17.7 € 12-month fair value ex div. 15.7 €


DCF – sensitivity to perpetuity growth and WACC assumptions

WACC

Perpetuity growth €/share -3.0% -2.0% -1.0% 0.0% 1.0% 2.0% 3.0%

7.0% 18.1 18.9 19.8 20.9 22.5 24.6 27.9

8.0% 16.5 17.1 17.7 18.5 19.6 21.0 22.9

9.0% 15.2 15.6 16.1 16.7 17.4 18.4 19.6

10.0% 14.1 14.4 14.8 15.2 15.7 16.4 17.3

11.0% 13.1 13.4 13.7 14.0 14.4 14.9 15.5

12.0% 12.3 12.5 12.7 13.0 13.3 13.7 14.1

13.0% 11.6 11.8 11.9 12.1 12.4 12.6 13.0


JUMBO

October 17, 2016

6

FY17 outlook

1) Top line

Jumbo has managed to sustain positive sales growth in Greece since 2012 despite the unprecedented challenges that the business has faced in recent years. The performance in 2016 was quite impressive with Jumbo delivering 4.8% domestic sales growth, with run-rates strengthening in H2 (calendar H1) as the impact from the imposition of capital controls started to abate. Romania and – to a lesser extent – Bulgaria remain growth engines and have been seeing accelerating momentum but the Greek business will remain the primary driver of top line and profitability going forward, especially as the domestic economy seems to have reached the tipping point (IMF forecasting Q4 GDP +0.7% yoy).

Jumbo sales growth breakdown

Source: IOBE, Company data, Eurobank Equities Research

Looking ahead into 2017, mgt guides for sales growth of 4-7% at group level. Taking into account the store-rollout plan, which provides for the opening of 3 POS, we estimate this translates to 2-5% organic growth coupled with c1-2% growth from new capacity. Mgt also revealed that the low end of the guidance is predicated on Greek LFL sales -1%/-2% while the upper end of the guidance assumes slight growth in Greek LFL. Mgt admitted that the guidance is out of sync with the Q1 performance (group sales +11.5%, Greece +4%), but pointed out that current run rates in Greece are negative. It also emphasized that visibility around Greek macro is rather low, noting that more clarity will be provided at the January trading update.

That being said, our baseline scenario is more optimistic than mgt’s budget and is underpinned by the abovementioned IMF estimates which point to calendar Q4’16 being the inflection point for the Greek economy and CY17 experiencing a strong turnaround (GDP +2.8%). Our updated estimates for Jumbo incorporate group sales growth of +7.8% predicated on Greek sales +3.5% (+4% in Q1’17) and average store density at group level (sales per store) c+6%, similar to FY16.

-15%-10%

-5%0%5%

10%15%20%25%30%

20

04

20

05

20

06

20

07

20

08

20

09

20

10

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11

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14

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16

Capacity Store density Group sales growth

Successfully navigating the

tough macro…

Mgt 4-7% sales growth

guidance assumes Greek LFL

will be slightly negative to

slightly positive…

… as run rates in Greece have

turned negative in the last

month

JUMBO

October 17, 2016

7

Jumbo estimates by country EURmn FY'15 FY'16 FY'17e FY'18e FY'19e

Greece

Sales 437.9 458.9 474.6 500.5 529.7

% change 2.9% 4.8% 3.4% 5.5% 5.8%

Number of stores 53 51 51 52 53

EBITDA 133.2 142.4 145.3 156.2 169.2

Cyprus

Sales 75.0 78.9 84.1 85.8 87.5

% change 12% 5% 7% 2% 2%


EBITDA 29.3 31.5 32.9 33.8 34.6

Bulgaria

Sales 45.3 51.9 61.0 66.3 68.3

% change 12% 15% 17% 9% 3%


EBITDA 14.5 17.6 20.3 22.4 23.5

Romania

Sales 24.3 47.9 67.3 79.3 89.4

% change 175% 97% 40% 18% 13%


EBITDA 6.7 16.2 21.6 26.0 29.5

Unallocated costs -24.3 -24.0 -25.1 -25.7 -26.8

Group EBITDA 159.3 183.7 195.1 212.7 229.9

Group EBITDA margin 27.3% 28.8% 28.4% 29.1% 29.7%

Source: Company, Eurobank Equities Research. EBITDA is pre-central costs.

It is worth emphasizing that the correlation between Jumbo’s domestic sales density and consumer confidence has recently been questioned, as Jumbo has been growing its organic sales in a period during which consumer confidence has been hovering around multi-month low levels. In this respect, we think there is upside risk from a pick-up in consumer confidence as the govt delivers on the reform program and secures the disbursement of the related loan tranches, especially the EUR5bn that will be channelled to the clearance of arrears (to be disbursed by calendar Q1’17 according to the program provisions).

Jumbo Greece – sales per store and consumer confidence (calendar quarters)

Source: IOBE, Company data, Eurobank Equities Research

-90.0

-80.0

-70.0

-60.0

-50.0

-40.0

-30.0

-20.0

-15.0%

-10.0%

-5.0%

0.0%

5.0%

10.0%

15.0%

Q3

'11

Q4

'11

Q1

'12

Q2

'12

Q3

'12

Q4

'12

Q1

'13

Q2

'13

Q3

'13

Q4

'13

Q1

'14

Q2

'14

Q3

'14

Q4

'14

Q1

'15

Q2

'15

Q3

'15

Q4

'15

Q1

'16

Q2

'16

Q3

'16

e

Sales per store yoy change (left) Consumer confidence (right)

Jumbo trading remains

positive despite subdued

consumer confidence

JUMBO

October 17, 2016

8

Beyond 2017, we still believe that Jumbo can sustain at least mid-single digit growth (5-6%). We remind investors that our forecasts for Jumbo’s Greek operations are hardly over-ambitious, as they imply 3-4% growth in sales per store with domestic store sales density not returning to the 2009 level until 2021.

Jumbo Greece – sales and profit per store (rebased)


70

75

80

85

90

95

100

20

09

20

10

20

11

20

12

20

13

20

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20

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20

17

20

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20

19

20

20

Sales per store EBITDA per store

JUMBO

October 17, 2016

9

2) Costs

Of Jumbo’s cost base, some 63% relates to raw materials/COGS (including transport costs) and another c17% to labour costs. The remaining cost base of cEUR100m is a mixture of rents (3%), depreciation (5%), and other administrative/third party expenses.

Jumbo cost base (% of costs and sales)


Focusing on the gross margins, these have demonstrated impressive resilience ranging between 52% and 54.4% since 2006. As we have reiterated several times in past reports, Jumbo’s gross margins depend primarily on three factors: FX (mainly EUR/USD), transport costs and product mix. In more detail:

- FX: o The depreciation of the EUR vs. the USD has made imports from China more

expensive for Jumbo, with the margin pressure peaking in Q1-Q3 2015 (calendar). At the current juncture, the EUR/USD does not feature as a major swing factor as it seems to have stabilised near the 1.10-1.12 range since the beginning of 2015.

o On the other hand, it is interesting to point out that the Chinese yuan remains on a downward trajectory (c-3.5% vs the USD year-to-date), and is likely to act as a tailwind for margins in FY17.

- Transport costs

o Transport costs currently make up c19% of Jumbo’s COGS, we estimate, and have declined significantly over the last 3 years as a result of lower oil prices and overcapacity in the freight industry. Lower transport costs were the key tailwind for Jumbo in FY16, with the average price of container exports from Chinese ports down c28% in the 12-month period following 5-6% declines in FY14-15.

o As the chart below shows, container shipping rates have recovered substantially from the record low reached in Q1 2016, as the impact from the overhang of new supply delivered in previous months has started to abate. However, on our understanding, although pricing has recovered somewhat, the balance between supply and demand points to rates remaining relatively subdued through to 2018. Thus, on our estimates, unit transport costs are set to be flattish in FY17.

63% 17%

3%

5%

13%

% of costs COGS

Staff costs

Rentals

Depreciation

Other

47% 13%

2%

4%

9%

% of sales

COGS

Staff costs

Rentals

Depreciation

Other

Deflationary trends vs. margin-

accretive product mix and

potential renminbi

depreciation

JUMBO

October 17, 2016

10

EUR/USD Containerized freight indices


- Product mix: o Jumbo’s highest-margin category is home and seasonal items. As the chart

below showcases, these accounted for just 20% of the sales mix in 2004 but have now exceeded 55%. In contrast, toys now represent less than 30% of the mix vs. 50% in 2004. Growth in home/seasonal products will most likely continue to outpace growth in the other categories, providing a boost on margins. We stress that the margin differential between the traditional toy segment and home/seasonal items can be as high as 30 pps.

Jumbo mix by product category

Source: Eurobank Equities Research, Company data

- Greek-specific issues:

o Continuing deflationary pressures and aggressive competition from struggling supermarket chains are factors weighing on margins in Greece. In addition, the small (1%) VAT hike in June 2016 is an extra headwind facing Greek retailers, especially as affordability issues make it extremely challenging for companies to pass this on to consumers.

Overall, according to mgt’s comments gross margins are set to decline in FY17 and may contract as much as 300bps depending on the evolution of the abovementioned drivers. However, our updated estimates point to a less pronounced decline (-130bps). In fact, we actually consider our estimate conservative given that a potential further depreciation of the renminbi will cushion Jumbo’s gross margin contraction. Our understanding is that risks to the renminbi remain on the downside.

1.05

1.10

1.15

1.20

1.25

1.30

1.35

1.40

1.45

Jul-

12

No

v-1

2

Mar

-13

Jul-

13

No

v-1

3

Mar

-14

Jul-

14

No

v-1

4

Mar

-15

Jul-

15

No

v-1

5

Mar

-16

Jul-

16

EUR/USD FY13 av. FY14 av.

FY15 av. FY16 av. FY17 av.

400

600

800

1000

1200

1400

Jul-

12

Oct

-12

Jan

-13

Ap

r-1

3

Jul-

13

Oct

-13

Jan

-14

Ap

r-1

4

Jul-

14

Oct

-14

Jan

-15

Ap

r-1

5

Jul-

15

Oct

-15

Jan

-16

Ap

r-1

6

Jul-

16

CCFI FY13 FY14

FY15 FY16 FY17e

0%

20%

40%

60%

80%

100%

20

09

20

10

20

11

20

12

20

13

20

14

20

15

20

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20

17

e

20

18

e

20

19

e

Mix by product category (% of sales)

Seasonal/Home Baby Books/Stationery Toys

JUMBO

October 17, 2016

11

Estimates

We summarise the changes to our estimates in the table below. Overall, we end up with just slightly higher EBITDA numbers vs. our previous estimates as we expect tight monitoring of operating costs to more than fully offset the effect of the contraction in gross margins. With regard to the latter, we have filtered through the recent pick-up in freight rates (since July) which has effectively rendered transport costs a side wind for Jumbo in FY17 (assuming spot rates for the remainder of the year). Estimate changes

FY17e FY18e

New Sales 687.0 732.0

EBITDA 195.1 212.7

PBT 173.7 192.3

Net profit adj. 128.5 143.5

Previous Sales 676.2 717.8

EBITDA 192.8 207.8

PBT 172.5 191.6


% change Sales 2% 2%

EBITDA 1% 2%

PBT 1% 0%

Net profit adj. 0% 0%

Source: Company, Eurobank Equities Research

As the table below highlights, our new estimates are 3-5% above consensus at EBITDA level for FY17-18 as a result of higher top line estimates in FY17 and more resilient margins in FY18e. Similarly, our net profit numbers stand c2-6% above market estimates. Eurobank Equities vs. consensus

FY17e FY18e

Eurobank Equities estimates Sales 687.0 732.0

EBITDA 195.1 212.7

PBT 173.7 192.3


Consensus Sales 676.8 723.6

EBITDA 188.9 202.3

PBT 167.9 181.5


% diff Sales 2% 1%

EBITDA 3% 5%

PBT 3% 6%

Net profit adj. 2% 6%

Source: Eurobank Equities Research, Bloomberg

We are sticking with a forecast

for mid- single digit EPS

growth in FY17…

… and stand 2-6% above

consensus

JUMBO

October 17, 2016

12

Consistently outperforming guidance…

At this stage, it might be useful to present a brief overview of Jumbo’s actual performance over the last 3 years compared with mgt’s guidance as communicated at the start of each financial year (i.e. in September-October). The results are laid out in the table below.

Guidance history

Net profit in EURm FY14 FY15 FY16 FY17e

Guidance at annual analyst meeting 75.0 90-95 78-88 121.3

Actual delivered 101.2 104.9 121.3

Eurobank Equities estimate at the time 95.7 108.4 103.5 128.5

Actual vs. guidance 35% 13% 46%

Actual vs. Eurobank Equities estimate 6% -3% 17%

Sales growth guidance 2-4% 4-6% 0-4% 4-7% Actual delivered 8% 8% 9% Eurobank Equities estimate at the time 3% 8% 2% 8%


As can be seen, as a result of the tough macroeconomic backdrop in Greece mgt has been basing its budget on quite conservative assumptions at the start of each financial year. The end result has proved much better, with top line growth consistently beating expectations despite several headwinds each year (e.g. austerity measures, capital controls). Overall, Jumbo has managed to sustain adj. net profit growth in the low to mid-single digits in both FY14 and FY15 and low teen growth in FY16. The actual result delivered was significantly above the initial guidance and, in fact, exceeded even our estimates at the time. The exception was FY15 when the actual result was slightly below our estimate at the start of the period, but this represented an impressive performance in the context of the political turmoil and the escalation of the Greek crisis in the first half of 2015 (second half of Jumbo’s FY15).

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October 17, 2016

13

FY’16 results overview

Jumbo results summary EURmn H1'15 H2'15 H1'16 H2'16 yoy H1 yoy H2 FY'15 FY'16 yoy FY FY'16e Sales 341.1 241.4 371.8 265.8 9% 10% 582.5 637.6 9% 637.6 of which: Greece 256.4 181.5 265.2 193.7 3% 7% 437.9 458.9 5% 457.1 Cyprus 43.4 31.6 45.8 33.1 5% 5% 75.0 78.9 5% 79.0 Bulgaria 28.6 16.7 32.3 19.7 13% 17% 45.3 51.9 15% 53.1 Romania 12.7 11.6 28.4 19.4 124% 68% 24.3 47.9 97% 48.4

COGS 167.2 105.6 180.2 119.5 8% 13% 272.8 299.6 10% 296.1 Gross profit 173.9 135.8 191.6 146.3 10% 8% 309.7 337.9 9% 341.5 margin 51.0% 56.3% 51.5% 55.1% 0.56% -1.20% 53.2% 53.0% -0.16% 53.6% Operating costs -79.7 -68.4 -83.8 -68.4 5% 0% -148.1 -152.1 3% -158.5 % of sales 23.4% 28.3% 22.5% 25.7% -0.83% -2.60% 25.4% 23.9% -1.55% 24.9% Other income/ (expenses) -2.5 0.2 -2.3 0.2 -2.4 -2.1 -2.3

EBITDA 91.6 67.6 105.5 78.2 15% 16% 159.3 183.7 15% 180.7

EBITDA margin 26.9% 28.0% 28.4% 29.4% 1.51% 1.42% 27.3% 28.8% 1.48% 28.3% Depreciation -10.6 -10.6 -11.2 -11.4 -21.2 -22.7

-22.6

Net interest income (expense) 1.2 0.4 0.7 -1.0 1.7 -0.4 1.5 PBT - adj. 82.2 57.5 94.9 65.7 15% 14% 139.7 160.7 15% 159.6 Exceptionals -0.8 -1.9 1.9 0.4 -2.7 2.2 0.0 PBT - reported 81.4 55.6 96.8 68.3 19% 23% 137.0 165.1 21% 159.6 Tax -18.8 -13.4 -24.3 -19.6 -32.1 -43.9 -41.0 Net profit - reported 62.7 42.2 72.5 48.7 16% 15% 104.9 121.3 16% 118.6 EPS - reported (EUR) 0.46 0.31 0.53 0.36 16% 15% 0.77 0.89 16% 0.87 FCF 75.0 0.6 129.7 -45.3 75.5 84.4

103.1 Net cash 180.4 152.1 281.2 250.4 152.1 250.4

263.3 Inventory 179.0 197.8 152.6 196.8 197.8 196.8 214.3 Average EUR/USD 1.29 1.12 1.10 1.12 1.20 1.11 CCFI % change yoy 0.0% -11.5% -27.0% -28.5% -5.0% -28.0%


Jumbo managed to beat our estimates (EEe) once again, reporting H2 EBITDA 4% above EEe and 7% above consensus on the back of opex containment which more than offset the gross margin pressure (-120 bps in H2). In more detail, H2 sales of €265.8m (+10% yoy) were already pre-released driven by 7% growth in Greece (despite Jumbo operating 2 fewer stores yoy), 17% in Bulgaria and c68% in Romania (propelled by the operation of 7 stores vs. 5-6 stores in H2’15). On the margin front, Jumbo suffered a c120 bps gross margin decline in H2 (following c60bps expansion in H1) as a result of the VAT hike which more than offset lower transport costs. Operating expenses were however flat in H2 helping Jumbo deliver EBITDA of €78m, +16% yoy. Overall, in FY16 Jumbo reported sales €637.6m (+9.4% yoy) and EBITDA €183.7m (+15.3% yoy). Net profit amounted to €121.3m (+15.7% yoy), also boosted by a c€2.2m gain related to the valuation of a corporate bond. Being a retailer managing efficiently its working capital, Jumbo continues to convert the bulk of EBITDA into operating cash flow (OCF €119m in FY16, c65% of EBITDA). Jumbo delivered €85m of FCF in FY16 ending the year on a €259m net cash position. The BoD has decided to propose a final DPS of €0.27, taking the total dividend distributed in FY16 to €0.54 (fully compensating for the absence of a dividend distribution in FY15).

JUMBO

October 17, 2016

14

Feedback from the analyst meeting

The tone that mgt used was, as always, cautious with Mr. Vakakis sticking with the guided 4-7% sales growth and flat net profits for FY17. In more detail:

Current trading: Mgt suggested that despite the very strong start to the year (Q1’17 sales +11.5%), current run rates in Greece (i.e. trading since mid Sep) are negative. Mgt also emphasized that Q1 benefited from the easy comps (capital controls in July 2015).

Sales guidance assumptions: Mgt clarified that the low end of the sales guidance (4% group sales growth) is predicated on Greek LFL -1%/-2%. The upper end of the guidance (7%) assumes Greek LFL marginally positive.

Gross margins: mgt warned that gross margins will contract this year on the back of persisting deflationary trends. Mgt referred to “up to 300 bps” contraction, which we deem too pessimistic.

Guidance: Mgt clarified that the ”guidance” effectively reflects what it has budgeted for the year. We remind investors that in October 2015 mgt had guided for 2016 profits down 15-25% but the actual number delivered was 16% growth.

Dividend: mgt was asked whether it intends to alter its dividend policy. The answer was that it will stick to its usual 1/3 return policy, effectively implying that any excess cash flow will be used to strengthen the group’s profile even more.

Capex: 2017e capex is likely to be c€50m, namely somewhat higher vs. the usual €30-35m level, but the actual amount may vary depending on the phasing.

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October 17, 2016

15

Interim results and divisional breakdown

Jumbo P&L estimates EURmn Q1'15 Q2'15 Q3'15 Q4'15 FY'15 Q1'16 Q2'16 H2'16 FY'16 Sales 145.5 195.6 105.0 136.4 582.5 152.6 219.1 265.8 637.6

% change 10.9% 5.4% 11.5% 4.2% 7.5% 4.9% 12.0% 10.1% 9.4% Gross profit 69.2 104.7 57.6 78.2 309.7 73.2 118.4 146.3 337.9 margin 47.5% 53.5% 54.8% 57.4% 53.2% 48.0% 54.0% 55.1% 53.0% Operating costs -38.2 -41.5 -37.2 -31.1 -148.0 -39.3 -44.4 -68.3 -152.1 % of sales 26.2% 21.2% 35.4% 22.8% 25.4% 25.8% 20.3% 25.7% 23.9% Other income/(expenses) -1.0 -1.5 0.2 -0.1 -2.4 -1.0 -1.3 0.2 -2.1

EBITDA 30.0 61.7 20.6 47.0 159.3 32.9 72.6 78.2 183.7

EBITDA margin 20.6% 31.5% 19.6% 34.5% 27.3% 21.5% 33.1% 29.4% 28.8% Depreciation -5.0 -5.7 -5.1 -5.5 -21.2 -5.6 -5.6 -11.4 -22.7 Net interest income (expense) 0.7 0.6 0.4 0.1 1.7 0.1 0.5 -1.0 -0.4

PBT 25.5 55.9 15.5 40.1 137.0 29.2 67.6 68.3 165.1

Tax -5.5 -13.2 -3.6 -9.7 -32.1 -7.4 -16.9 -19.6 -43.9 Tax rate 21.6% 23.7% 23.4% 24.3% 23.4% 25.3% 25.0% 28.6% 26.6%

Net profit - adj 20.1 43.2 12.2 31.5 106.9 20.5 50.7 48.5 119.6

Net profit - reported 20.0 42.7 11.9 30.4 104.9 21.8 50.7 48.7 121.3 EPS - reported (EUR) 0.15 0.31 0.09 0.22 0.77 0.16 0.37 0.36 0.89

Inventory 192.3 179.0 207.8 197.8 197.8 178.3 152.6 196.8 196.8 Average EUR/USD 1.33 1.26 1.13 1.11 1.20 1.11 1.10 1.12 1.11 CCFI % change yoy 1.0% -1.0% -5.0% -18.0% -5.0% -26.0% -28.0% -28.5% -28.0%


Jumbo divisional results EURmn Q1'15 Q2'15 Q3'15 Q4'15 FY'15 Q1'16 Q2'16 H2'16 FY'16

Greece

Sales 113.5 142.9 79.1 102.4 437.9 111.7 153.5 193.7 458.9

growth 6.8% -0.1% 7.9% -0.5% 2.9% -1.6% 7.4% 6.7% 4.8%

% change in sales per store 4.7% -2.0% 6.9% -1.5% 1.9% -0.6% 11.6% 9.8% 6.3%

EBITDA 25.7 49.2 18.5 39.7 133.2 24.5 55.2 62.7 142.4

margin 22.7% 34.4% 23.4% 38.8% 30.4% 21.9% 36.0% 32.4% 31.0%

Cyprus

Sales 18.3 25.1 14.3 17.3 75.0 20.0 25.8 33.1 78.9

growth 18.3% 13.2% 10.5% 6.2% 12.2% 9.1% 2.8% 4.6% 5.1% EBITDA 7.4 9.6 5.4 6.8 29.3 8.4 10.2 12.9 31.5

margin 40.7% 38.4% 37.7% 39.3% 39.0% 42.1% 39.4% 39.1% 40.0%

Bulgaria

Sales 11.1 17.5 7.0 9.8 45.3 12.4 19.9 19.7 51.9 growth 17.3% 9.9% 15.3% 8.0% 12.0% 11.8% 13.6% 17.4% 14.5% EBITDA 3.7 6.4 1.4 3.0 14.5 4.3 7.4 5.8 17.6 margin 33.1% 36.6% 20.6% 30.7% 32.0% 34.9% 37.4% 29.4% 33.8%

Romania Sales 2.7 10.1 4.6 7.0 24.3 8.6 19.9 19.4 47.9 EBITDA 0.4 3.8 1.1 1.3 6.7 3.0 7.4 5.8 16.2 margin 16.8% 38.1% 23.3% 18.6% 27.4% 35.1% 37.3% 29.8% 33.9%

EBITDA - pre central costs 37.3 69.1 26.4 50.8 183.6 40.2 80.2 87.2 207.7

Unallocated -7.3 -7.4 -5.8 -3.9 -24.3 -7.4 -7.6 -9.0 -24.0

Group EBITDA 30.0 61.7 20.6 47.0 159.3 32.9 72.6 78.2 183.7

Source: Company, Eurobank Equities Research. Geographic segment EBITDA is pre-central costs.

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October 17, 2016

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Brief company description

Jumbo is Greece’s largest retailer of toys, baby items, seasonal and decoration items, books and stationery. It operates 51 stores in Greece, 5 in Cyprus, 8 in Bulgaria and another 7 in Romania. Having started as a specialist of toy products in 1986, Jumbo has evolved into more than simply a specialist retailer of toys and baby products. The group has now become one of the biggest retail chains in Greece and is considered to be a “one‐stop” destination for consumers, who can also find books and stationery as well as seasonal and household products in its shops. Jumbo generated c72% of sales in Greece in FY16, and this figure is likely to fall to c68% by 2018, on our estimates.

Risks and sensitivities

Macroeconomic environment: The main risk for Jumbo is its high exposure to the Greek consumer demand with >70% of its sales being Greek‐based. Therefore, any significant decline in economic activity would put pressure on consumer expenditure negatively affecting Jumbo’s profitability. We estimate that each 1% movement in domestic sales is worth c1.3% on group EBITDA.

Seasonality: Jumbo generates c28% of its annual turnover in December and another c10% in each of Easter and early September. This seasonality requires merchandise purchases to be made well in advance; as a result, overstocking could result in products sitting on the shelf for longer than expected, eventually leading to inventory markdowns.

USD cost base: The group imports c80% of its products from China and pays for these in US Dollars (USD), so currency movements can have a significant impact on earnings. We estimate that a 5% change in the USD/EUR rate would impact the group’s EBITDA by c6%.

Reliance on Chairman: The Chairman Mr. Vakakis, has guided the group through its evolution from a toy retailer into a hypermarket and through its international expansion in both Cyprus and Bulgaria. Any decision on his behalf to step down could result in uncertainty about the group’s future strategy. In addition, given that the Vakakis family controls c31% of the voting rights, there might be a stock overhang were a portion of this stake to be sold in the future.

JUMBO

October 17, 2016

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Group Financial Statements

Balance Sheet

FY to end June (EUR mn) 2015a 2016a 2017e 2018e 2019e

Non-current Assets

Property, Plant & Equipment 497.9 498.8 520.7 516.5 511.2

Investment property 6.1 5.7 5.7 5.7 5.7

Other Long-term assets 29.1 26.0 26.0 26.0 26.0

Total Non-current Assets 533.1 530.5 552.5 548.2 542.9

Inventories 197.8 196.8 209.9 223.7 236.8

Trade Receivables 15.5 32.6 35.1 37.4 39.6

Other Receivables 39.1 46.7 47.8 48.4 48.7

Cash & Equivalents 298.9 394.7 412.3 511.7 623.0

Securities 5.9 8.2 0.6 0.0 0.0

Current assets 557.2 678.9 705.7 821.1 948.1

Total Assets 1,090.3 1,209.4 1,258.2 1,369.4 1,491.0

Share Capital & Premium 169.5 119.6 119.6 119.6 119.6

Reserves 627.7 796.0 851.0 954.7 1,068.6

Minority Interest 0.0 0.0 0.0 0.0 0.0

Total Equity 797.2 915.6 970.6 1,074.3 1,188.2

LT Loans 143.9 144.2 142.8 0.0 142.2

Provisions 25.7 21.1 21.1 21.1 21.1

Long Term Liabilities 169.6 165.3 163.9 21.1 163.3

ST Loans 2.9 0.2 0.0 142.2 0.0

Trade Payables 51.4 39.1 75.6 80.5 85.2

Other Payables 69.2 89.3 48.1 51.2 54.2

Current liabilities 123.5 128.6 123.7 274.0 139.5

Total Equity & Liabilities 1,090.3 1,209.4 1,258.2 1,369.4 1,491.0


JUMBO

October 17, 2016

18

P&L


Turnover 582.5 637.6 687.0 732.0 775.0

change 7.5% 9.4% 7.8% 6.5% 5.9%

Gross Profit 309.7 337.9 354.9 378.0 400.6

Gross margin 53.2% 53.0% 51.7% 51.6% 51.7%

Selling, Administrative & Other Expenses 148.1 152.1 157.8 164.3 170.7

Other Income (net) -2.4 -2.1 -2.0 -1.0 0.0

EBITDA - adjusted 159.3 183.7 195.1 212.7 229.9

change 8.7% 15.3% 6.2% 9.0% 8.1%

EBITDA margin 27.3% 28.8% 28.4% 29.1% 29.7%

Depreciation 21.2 22.7 23.2 24.3 25.0

EBIT 138.0 161.0 171.9 188.4 204.9

change 8.6% 16.7% 6.7% 9.6% 8.8%

EBIT margin 23.7% 25.3% 25.0% 25.7% 26.4%

Net Financial Expense / Income 1.7 1.9 1.8 3.9 6.8

Extraordinary -2.7 2.2 0.0 0.0 0.0

Earnings Before Tax 137.0 165.1 173.7 192.3 211.7

change 5.4% 20.5% 5.2% 10.7% 10.1%

EBT margin 23.5% 25.9% 25.3% 26.3% 27.3%

Recurring tax 32.1 43.9 45.2 48.8 53.3

Recurring Tax Rate 23.4% 26.6% 26.0% 25.4% 25.2%

Corporate levy 0.0 0.0 0.0 0.0 0.0

Earnings After Tax - reported 104.9 121.3 128.5 143.5 158.4

Minorities 0.0 0.0 0.0 0.0 0.0

Net Profit - adjusted 106.9 119.6 128.5 143.5 158.4

change 5.6% 11.8% 7.4% 11.7% 10.4%

Net Profit margin 18.4% 18.8% 18.7% 19.6% 20.4%

EPS - adjusted 0.79 0.88 0.94 1.05 1.16

DPS 0.18 0.54 0.29 0.33 0.36


* DPS includes special dividend in FY15.

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October 17, 2016

19

Cash Flow Statement


EBIT 138.0 161.0 171.9 188.4 204.9

Depreciation and Amortization 21.2 22.7 23.2 24.3 25.0

Changes in Working Capital 8.2 -23.1 -17.2 -5.1 -4.6

Net Interest 2.3 1.3 1.8 3.9 6.8

Tax -31.7 -42.8 -45.2 -48.8 -53.3

Other 0.2 0.2 0.0 0.0 0.0

Net Inflows (Outflows) from Operating Activities 138.2 119.2 134.5 162.7 178.8

Capex -59.1 -34.7 -49.5 -23.5 -23.0

Other investing inflow (outflow) -3.4 0.1 0.0 0.0 0.0

Net Inflows (Outflows) from Investing Activities -62.5 -34.6 -49.5 -23.5 -23.0

Free Cash Flow 75.7 84.6 85.0 139.2 155.8

Free Cash Flow (adj.) 79.1 84.5 85.0 139.2 155.8

Net dividends paid -45.8 0.0 -73.5 -39.8 -44.5

Net debt (cash) -158.0 -258.5 -270.1 -369.5 -480.8


Ratios

FY to end June 2015a 2016a 2017e 2018e 2019e

P/E 10.1 13.0 11.9 10.7 9.8

P/BV 1.6 1.7 1.6 1.4 1.3

P/Sales 2.3 2.5 2.3 2.2 2.0

EV/EBITDA 5.8 7.2 6.6 5.6 4.8

EV/Sales 2.3 2.2 1.9 2.1 1.8

EBIT/Interest expense NM NM NM NM NM

Net Debt/EBITDA (net cash) -1.2 -1.4 -1.6 -1.9 -2.3

Dividend Yield 2.1% 4.5% 2.5% 2.7% 3.0%

ROE 13.9% 13.8% 13.8% 14.0% 13.8%

Free Cash Flow yield 6.0% 5.2% 6.9% 9.1% 10.0%

Dividend payout ratio 22.9% 61.4% 31.0% 31.0% 31.0%


JUMBO

October 17, 2016

20

IMPORTANT DISCLOSURES This report has been issued by Eurobank Equities Investment Firm S.A., a member of the Athens Exchange, a member of the Cyprus Stock Exchange and a member of Eurobank Ergasias S.A. Eurobank Equities Investment Firm S.A.. is regulated by the Hellenic Capital Markets Commission (HCMC) with authorization number 6/149/12.1.1999.This report may not be reproduced in any manner or provided to any other persons. Each person that receives a copy by acceptance thereof represents and agrees that it will not distribute or provide it to any other person. This report is not an offer to buy or sell or a solicitation of an offer to buy or sell securities mentioned herein. The investments discussed in this report may be unsuitable for investors, depending on their specific investment objectives and financial position. The investments discussed in this report are subject to risks and in respect of some investments there is risk for multiplied losses to be caused in respect to the capital invested.

The information on this research report is only intended to be available to non U.S. investors and/or residents outside of the United States, Australia, Canada, Japan and South Africa. In certain jurisdictions, including but not limited to the United States, Australia, Canada, Japan and South Africa, the furnishing of such information may be restricted or prohibited by applicable laws. Potential users of the information are requested to inform themselves about and observe any such restrictions, and if you are not permitted to view material on this report or are in any doubt as to whether you are permitted to view these material, please discard/ignore this report.

By reading this research report, you warrant that you are not located in the United States or in any other jurisdiction in which the furnishing of such information may be restricted or prohibited and you agree that you will not transmit or otherwise send any information contained in this report to any person in the United States or to publications with a general circulation in the United States or any other restricted jurisdiction.

Any information provided on this report does not constitute or implicitly substitutes a recommendation for the purchase, sale, subscription, redemption, exchange, retention of a specific financial instrument or the exercise of any right a specific financial instrument grants for the purchase, sale, subscription, exchange or redemption of a financial instrument and thus, it cannot be considered as provision of investment advice or as any solicitation whatsoever.

The information contained herein has been obtained from sources believed to be reliable but it has not been verified by Eurobank Equities Investment Firm S.A.. The opinions expressed herein may not necessarily coincide with those of any member of the Eurobank Group. No representation or warranty (express or implied) is made as to the accuracy, completeness, correctness, timeliness or fairness of the information or opinions herein, all of which are subject to change without notice. No responsibility of liability whatsoever or howsoever arising is accepted in relation to the contents hereof by Eurobank Equities Investment Firm S.A. or any of its directors, officers or employees.

Eurobank Equities Investment Firm S.A. follows procedures under Eurobank Group policies that set up Chinese Walls, restricting communication between Research and other Departments of the Group so that Eurobank Equities Investment Firm S.A. complies with regulations on confidential information and market abuse. Eurobank Equities Investment Firm S.A., or any of its related legal persons, does not hold shareholdings exceeding 5% of the total issued share capital in Jumbo. None of the subject companies mentioned in this report holds shareholdings exceeding 5% of the total issued share capital of Eurobank Equities Investment Firm S.A., or any of its related legal persons. Eurobank Equities Investment Firm S.A., or any of its related legal persons, is a market maker of Jumbo. Eurobank Equities Investment Firm S.A., or any of its related legal persons, is not a party to an agreement relating to the production of this report with Jumbo. EUROBANK Equities Investment Firm S.A, or any of its related investment banking services’ legal persons, has not received compensation for investment banking services provided within the last twelve months from Jumbo. EUROBANK Equities Investment Firm S.A. occasionally trades for own account on investment instruments related to Jumbo.

Analyst Certification: This report has been written by Stamatis Draziotis, CFA (Equity Analyst).

Analyst Compensation: The remuneration of Stamatis Draziotis, CFA is not tied to the investment banking services performed by Eurobank Equities Investment Firm S.A. or any of its related legal persons. Stamatis Draziotis, CFA did not receive or purchase the shares of Jumbo S.A. prior to a public offering of such shares. Stamatis Draziotis, CFA does not have a significant financial interest in one or more of the financial instruments which are the subject of this report or a significant conflict of interest with respect to the subject companies mentioned in this report a) that are accessible or reasonably expected to be accessible to the persons involved in the preparation of this report or b) known to persons who, although not involved in the preparation of this report, had or could reasonably be expected to have access to this report prior to its dissemination to customers or the public. Planned Frequency of Updates: Eurobank Equities Investment Firm S.A. provides daily and monthly updates as well as updates on companies based on company-specific developments or quarterly financial results announcements or any other publicly available information.

12-month Rating History of Jumbo

Date Rating Stock price Target price

17/10/2016 Buy €11.94 € 15.00

16/09/2016 Buy €10.58 € 14.60

26/08/2016 Buy € 10.61 € 14.60

25/05/2016 Buy € 11.64 € 14.60

10/03/2016 Buy € 11.00 € 12.80

28/01/2016 Buy € 9.73 € 11.80

21/01/2016 Buy € 9.80 € 11.80

19/11/2015 Buy € 9.30 € 10.00

Eurobank Equities Investment Firm S.A. Rating System:

Stock Ratings Coverage Universe Investment Banking Clients

Count Total Count Total

Buy 14 52% 2 14%

Hold 6 22% 0 0%

Sell 2 7% 0 0%

Restricted 2 7% 2 100%

Under Review 3 11% 0 0%

Total 27 100%

Analyst Stock Ratings:

Buy: Based on a current 12-month view of total shareholder return (percentage change in share price to projected target price plus projected dividend yield), we recommend that investors buy the stock.

Hold: We adopt a neutral view on the stock 12-months out and, on this time horizon, do not recommend either Buy or Sell.

Sell: Based on a current 12-month view of total shareholder return, we recommend that investors sell the stock.

Restricted: Under Eurobank Group policy and / or regulations which do not allow ratings

Under Review: Our estimates, target price and recommendation are currently under review

Eurobank Equities Investment Firm S.A. Member of Athens Exchange, Cyprus Stock Exchange and Eurobank Group. Regulated by the Hellenic Capital Markets Commission Authorization No: 6/149/12.1.1999 VAT No: 094543092, General Commercial Reg. Num 003214701000

10 Filellinon Street 105 57 Athens, Greece

Telephone: +30 210-3720 000

Facsimile: +30 210-3720 001 Website: www.eurobankequities.gr

E-mail: [email protected]

http://www.eurobankequities.gr/

mailto:[email protected]

GREECE | EQUITY RESEARCH | RETAIL 12.50 12

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