„DINO POLSKA” S.A. – publikacja prospektu i rozpoczęcie oferty publicznej

IMPORTANT INFORMATION

Prior to obtaining access to the information placed on this website, please read carefully the following important information regarding the terms of access to this website and of the use of the information contained herein. Please note that the important information presented below may be changed or updated. Consequently, it should be read and analysed in whole whenever this website is accessed in the future. THE MATERIAL CONTAINED ON THIS WEBSITE IS NOT INTENDED FOR RELEASE, DISSEMINATION, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, IN OR INTO THE TERRITORY OF THE UNITED STATES, CANADA, JAPAN, AUSTRALIA, OR ANY OTHER JURISDICTION WHERE SUCH RELEASE, DISSEMINATION, PUBLICATION OR DISTRIBUTION WOULD CONSTITUTE A VIOLATION OF THE APPLICABLE LAWS OR WOULD REQUIRE REGISTRATION. The materials to which you will gain access relate to or are connected with (i) an initial public offering in the territory of Poland of up to 48,040,000 ordinary shares (the “Sale Shares”) in Dino Polska S.A with its registered office in Krotoszyn (the “Company”), with a nominal value of PLN 0.10 each (the “Offering”), conducted by Polish Sigma Group S.à r.l. (the “Selling Shareholder”), and (ii) with the seeking of the admission and introduction of 98,040,000 ordinary shares with a nominal value of PLN 0.10 each (the “Shares”), including the Sale Shares, to trading on the regulated market of the Warsaw Stock Exchange (the “Admission”). On 17 March 2017, the Financial Supervision Authority approved the prospectus (the “Prospectus”) prepared in connection with the Offering and the Admission. The Prospectus (in Polish), together with any supplements and update communications thereto, and with the announcement of the final number and price of the Sale Shares offered in the Offering (upon its drafting and publication), will be posted on, and will, during its validity period, continue to be available in an electronic form on the Company’s website (www.grupadino.pl) and at the website of Powszechna Kasa Oszczędności Bank Polski Spółka Akcyjna Oddział – Dom Maklerski PKO Banku Polskiego w Warszawie (www.dm.pkobp.pl) – solely for information purposes. The Prospectus is the sole legally binding offering document which contains, for the purposes of the Offering and the Admission, information about the Company, the Shares (including the Sale Shares) and the Offering. Materials posted on this website include the Prospectus with any supplements and update communications thereto, if any, the announcement of the final number and price of the Sale Shares offered in the Offering (upon its drafting and publication) and information which is either of promotional nature for the purposes of the Offering and the Admission or constitutes information disclosed by the Company to the public in the performance of the Company’s disclosure obligations under the applicable laws and regulations. These materials do not constitute an offer for the sale of securities in the United States, Canada, Japan, Australia, or any other jurisdiction where such offer for sale would constitute a violation of the applicable laws or would require registration. Securities may not be sold in the United States absent registration with the United States Securities and Exchange Commission or an exemption from registration under the U.S. Securities Act of 1933 (the “U.S. Securities Act”). Securities of the Company have not been and will not be registered under the U.S. Securities Act and may not be offered or sold in the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements under the U.S. Securities Act. Neither the Prospectus nor the securities of the Company covered thereby have been or will be registered, approved or notified in any country other than the Republic of Poland, specifically in accordance with the laws enacted based on Directive 2003/71/EC of the European Parliament and of the Council, as amended, and they cannot be offered or sold outside the territory of the Republic of Poland (including within the territory of other countries of the European Union or the United States of America, Canada, Japan or Australia) unless in any relevant state such offer or sale could be effected in compliance with the law without the need for the Company, the Selling Shareholder or their respective advisors for the purpose of the Offering to comply with any additional legal requirements. Any investor residing in or having its registered office outside the Republic of Poland should review the relevant regulations of Polish law as well as the regulations of other countries which may apply thereto in connection with the participation in the Offering. WE HEREBY INFORM YOU THAT THE MATERIALS AND INFORMATION TO WHICH YOU WILL BE GRANTED ACCESS AND THE USE OF SUCH MATERIALS AND INFORMATION: (I) ARE SUBJECT TO THE ABOVE RESTRICTIONS; (II) ARE DIRECTED TO PERSONS RESIDING IN AND ACCESSING THIS WEBSITE FROM THE TERRITORY OF THE REPUBLIC OF POLAND; (III) ARE NOT DIRECTED TO U.S. PERSONS OR PERSONS ACTING FOR THE ACCOUNT OF, OR ON BEHALF OF, A U.S. PERSON (AS SUCH TERM IS DEFINED IN REGULATION S UNDER THE U.S. SECURITIES ACT); (IV) ARE NOT DIRECTED TO PERSONS RESIDENT OR WITH A REIGSTERED OFFICE IN CANADA, JAPAN OR AUSTRALIA, OR IN ANY OTHER JURISDICTION WHERE ACCESSING THE MATERIALS AND INFORMATION CONTAINED ON THIS WEBSITE WOULD CONSTITUTE A VIOLATION OF THE APPLICABLE LOCAL LAWS OR WOULD REQUIRE REGISTRATION OR OBTAINING A PERMIT. Please note that reviewing and accessing these materials in violation of the above may constitute a violation of securities laws, in particular in Poland and the United States.

Dino Polska – H1 2017: rapid topline growth, stable profitability expansion and robust LFL growth

In H1 2017, Dino Polska S.A., one of the fastest growing grocery retail networks in Poland, generated consolidated revenue of PLN 2,018.4 million, compared to PLN 1,533.5 million, i.e. up by nearly 32% yoy. The rapid topline growth resulted from network rollout and rising sales in existing stores (LfL), totaling 14.7% in H1 2017, compared to 10.3% in the corresponding period of the previous year.

In Q2 2017 alone, the Dino Group recorded a 16.5% growth in LfL sales (compared to 12.0% the year before).

EBITDA (adjusted for PLN 12.3 million of non-recurring costs associated with the IPO) rose 37% to PLN 166.2 million. In the period January-June 2017, the Group generated a net profit of PLN 77.1 million (unadjusted for IPO costs), up 26% yoy.

As at the end of June 2017, Dino’s network consisted of 677 stores, i.e. 120 stores more than in the corresponding period in the previous year. At the same time, the Group had secured 429 locations for new stores, i.e. 27.7% more than the year before. In H1 Dino opened in total 49 new stores, compared to 46 openings the year before. In Q2 2017, the chain opened 38 new stores.

The Group is recording rapid sales growth with a gradual step-up in profitability. The Group’s gross margin in H1 2017 rose 0.2 p.p. to 22.7% yoy, the EBITDA margin was 8.2%, up 0.3 p.p. yoy.

In H1 2017, Dino Polska S.A. carried out its initial public offering. The Company’s shares were floated on the main market of the Warsaw Stock Exchange on 19 April 2017 and the offering was worth PLN 1.65 billion.

DINO GROUP’S RESULTS FOR H1 2017:

in PLN m	H1 2017	H1 2016	Change (%)
Revenue	2,018.4	1,533.5	+31.6%
Gross margin	22.7%	22.5%	+0.2 p.p.
LfL sales	14.7%	10.3%	+ 4.4 p.p.
EBITDA*	166.2	121.0	+37.3%
EBITDA margin*	8.2%	7.9%	+0.3 p.p.
Net profit**	77.1	61.3	+25.9%

*EBITDA adjusted for non-recurring costs associated with the IPO (PLN 1.1 million in H1 2016 and PLN 12.3 million in H1 2017

**unadjusted net profit

H1 2017 was another period in which the Dino Group’s volume of business continued to expand. A nearly 32% revenue growth rate (growth by value of PLN 484.9 million) yoy primarily attributable to the expansion of the Dino chain (in the 6-month period of 2017 the chain was increased by 49 stores) and increase in revenue in the existing store chain (like for like, LfL) by 14.7% yoy.

With the increasing volume of business the Group is recording robust and steadily growing profitability. The Group’s gross margin was 22.7% yoy, i.e. 0.2 p.p. yoy, and the EBITDA margin was 8.2%, up by 0.3 p.p. yoy.

According to its strategy, the Group continues the fast development of the Dino supermarket network, opening new proprietary stores and looking for new locations for further expansion. At the end of H1 2017, the Group had 120 stores more than in the corresponding period of 2016, reaching a total of 677 stores. At the end of June 2017, the Group increased its land bank and had 429 secured locations for new stores (including plots purchased and preliminary agreements for purchase of land). In accordance with its strategy, the Group plans to exceed 1200 opened stores by the end of 2020.

Retail grocery market

In H1 2017, the retail grocery market in Poland saw positive trends visible both in 2016 and in H1 2017.

The good market situation, rising disposable income and returning inflation support further improvement of consumer sentiment, thereby contributing to the overall retail grocery market and proximity segment.

The rising disposable income translates into more frequent and increased shopping among Poles. The growth rate of consumer prices visible since the end of 2016 has also contributed to higher top line revenues measured by like for like sales.

According to a Roland Berger report (from November 2016), an increase in total sales in the retail grocery market is expected in Poland at the average annual pace of 3.7% up to 2020.

The proximity segment, in turn, may be the fastest growing segment of the retail food trade in Poland measured using the average annual growth rate in the number of stores up to 2020.

H1 was a good period both for the overall market in retail food trade and for Dino. We recorded very good results in this period. We dynamically increase the sales volume and at the same time record satisfactory and gradually increasing profitability levels. We open new stores, regularly increasing the volume of our business. We reach high LfL sales levels in the existing chain. In H1 LfL sales increased 14.7% yoy, and in Q2 only this increase reached 16.5%. To summarize, we are satisfied with the H1 performance – says Szymon Piduch – President of the Management Board of Dino Polska S.A.

Good consumer moods associated with growing incomes and favorable economic situation support further dynamic growth of proximity supermarkets such as Dino. The consumer price growth rate additionally supports the market where we operate. The positive market trends observed in H1 2017 portend well for the upcoming months of 2017. In H1 we increased our land bank by nearly 28% yoy and we have secured 429 locations for further development. In H2 we want to significantly speed up the opening of new Dino stores – adds Szymon Piduch.

More information regarding Dino Polska S.A.:

Dino is a nationwide network of medium-sized supermarkets located in close proximity to where customers live. Its grocery stores are open every day (except for non-trade Sundays) from 6:00 a.m. to 11:00 p.m.¹. The Dino network is one of the fastest growing retail grocery trade networks in Poland. At the end of September 2020 it consisted of 1,371 stores across Poland.

The Dino Group’s business model blends the advantages offered by the format of conveniently-located mid-sized supermarkets with the capability of rapidly opening new stores and offering an attractive assortment primarily entailing attractively-priced branded and fresh products.

Dino stores offer customers approximately 5 thousand stock keeping units (SKUs). Most of the SKUs are either fresh products or branded products, including a full range of groceries, household chemicals and cosmetics as well as small household articles and appliances. Every Dino store has a staffed meat counter, with the Agro-Rydzyna meat processing plant supplying high quality meat and cold cuts.

The Dino Group’s logistics network consists of five distribution centers located in Krotoszyn, Jastrowie, Wolbórz, Rzeszotary and Łobez. Its geographic range makes it possible to deliver fresh products to all of the stores in Dino’s network every day of the week.

At the end of September 2020 the Dino Group had 24.1 thousand employees.

The Company has been listed on the main floor of the Warsaw Stock Exchange since April 2017. Dino Polska S.A. is majority-owned by Polish capital.

^{1 Some stores are open for less than the standard working hours in connection with aligning their operation to local regulations.}