PULSE REPORT

IRI Pulse Report Chilled & Fresh

Welcome to the Pulse Q3 2013 edition for chilled and fresh. We hope you find it useful. Please do not hesitate to contact us if you have any questions or comments at EU.Marketing@IRIworldwide.com.

Q3 2013

IRIworldwide.eu

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About the Report

This chilled and fresh report is one of 10 super category reports designed to show highlevel comparison and analysis for retail markets across major countries in Europe.

This report contains data gathered from around Europe. This market was split into the following categories: yogurts, dairy desserts and drinks, cream, eggs, margarines, butter, fats and spreads, milk, cheese, chilled juices, fresh desserts, salads, tofu/soya, chilled dips and sauces, ready meals, chilled fish and seafood, charcuterie, fresh vegetables and fresh fruit.

The report highlights key metrics such as total sales figures, market trends, category shares, winners and losers for Europe and for individual countries.

The data has been sourced from IRI retail databases and Eurostat the statistical branch of administration for the European Commission.

The countries included in the report are: France, Germany, Italy, the Netherlands, Spain and the United Kingdom (UK).

The market channels used for each country in this report are as follows:

Country
UK ES DE NL IT FR

Channels used
Hypermarkets, supermarkets, drugstores and impulse outlets Hypermarkets, supermarkets, hard Discounters and drugstores. It includes the Canary Islands. Hypermarkets, supermarkets, hard discounters and drugstores Hypermarkets, supermarkets, hard discounters and drugstores Hypermarkets, supermarkets, small self service, hard discounters and drugstores Hypermarkets and supermarkets

For analytical purposes the data sourced from available retail databases has been consolidated to provide consistent results. However, for some countries it was not possible to source data pertaining to certain categories. Where this occurred, it has been documented in the Notes section found at the end of the report.

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On the Radar

The chilled and fresh category in Europe remains in growth (up +1%), but the slowdown continues. Behind the headlines, though, there are some key success stories driven by off-shelf support and strong channel strategies. As the market approaches the 100m mark, the challenge for retailers and manufacturers alike is to drive the quality offering that only chilled can provide to unlock inflation-beating growth.

ECONOMIC FIGURES INFLUENCING CONSUMER BEHAVIOR

POPULATION IN MILLIONS Jan. 2012 France Germany Italy Netherlands Spain United Kingdom 65.3 80.3 59.3 16.7 46.8 63.4 Jan. 2013 65.6 80.5 59.6 16.8 46.7 63.8

UNEMPLOYMENT (%) Average 2012 10.2 5.5 10.7 5.3 25.0 7.9 Sep. 2013 11.1 5.2 12.5 7.0 26.6 7.5

AVERAGE 12 MONTH INFLATION RATES Average 2012 +2.5 +2.4 +3.5 +2.8 +2.3 +3.7 Sep. 2013 +1.2 +1.8 +1.8 +3.1 +2.3 +2.7

GDP IN MILLIONS ()

2012

2013 (e)

2 032 297 2 059 358 2 644 200 2 694 499 1 565 916 1 568 388 600 638 604 459

1 049 525 1 051 076 1 901 001 1 854 920

Source: Eurostat, September 2013 3

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GLOBAL TRENDS
TOTAL CHILLED & FRESH VALUE SALES AND % CHANGE VS. PRIOR YEAR

+1.0% +1.4%

+1.6%

VALUE SALES IN MILLIONS () Total EU DE FR 99 995 30 105 22 875 14 490 12 794* 10 518 9 213

+1.1%

IT UK NL ES

-0.4% +0.2%
*based on an exchange rate of 1.150 to the pound

TOTAL EUROPE +1.0% TOTAL CHILLED & FRESH VALUE SALES FOR THE LAST SIX QUARTERS (EURO)
30,000

Millions

25,000

5 585
20,000

5 578

5 947

5 647

5 584

France 5 696 Germany

15,000

7 441

7 321

7 589

7 576

7 430

7 510

Italy Netherlands

10,000

3 751 2 645

3 469 2 552 2 352 3 141

01-oct-12

3 629 2 620 2 329 3 174

30-dic-12

3 675 2 624 2 222 3 237

31-mar-13

3 732 2 700 2 311 3 201

30-jun-13

3 454 2 573 2 352 3 181

29-sep-13 Period Ending

Spain UK

5,000

2 325 3 180

0 01-jul-12

Source: IRI retail databases, period ending 29 September 2013 and prior five quarters 4

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Europe
CATEGORY VALUE SALES IN THE LAST YEAR
21 009 20 199

Euros, in Millions

10 866 8 009 6 254 5 719

5 002

4 717

4 340

3 605

Charcuterie Yogurts, Dairy Desserts & Drinks Margarine, Butter, Fats & Spreads Fresh Desserts Fresh Vegetables

Cheese Ready Meals Milk Chilled Juices Eggs

SHARE OF FRESH & CHILLED VALUE FOR THE YEAR

KEY TRENDS The chilled and fresh market is of huge significance in Europe, with sales almost touching the 100,000m mark. However, continued deceleration of growth is a concern, with sales behind inflationary growth in all markets (despite growing populations everywhere other than Spain, which should be driving growth levels). The chilled and fresh market continues to be dominated by the top three sectors; charcuterie, cheese and yogurts/dairy. Combined, these account for 52% of the total fresh and hilled market. However, yogurt/dairys long-term negative trend continues; as a result, the sector is losing share within the chilled and fresh market. Of greater concern, the magnitude of the sectors decline impacting on the total performance of the category.

Charcuterie Cheese Yogurts, Dairy Desserts & Drinks Ready Meals Margarine, Butter, Fats & Spreads Milk Fresh Desserts Chilled Juices Fresh Vegetables Eggs Fresh Fruit Chilled Fish and Seafood Salads Cream Chilled Dips and Sauces Tofu / Soya

21.0% 20.2% 10.9% 8.0% 6.2% 5.7% 5.0% 4.7% 4.3% 3.6% 2.6% 2.4% 2.4% 1.9% 0.7% 0.1%

Europe includes: France, Germany, Italy, Netherlands, Spain and United Kingdom Source: IRI retail databases, period ending 29 September 2013 5

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Europe

TOP WINNERS: VALUE SALES CHANGE VS. YR. AGO ()

Millions
0 100 200 300 400 500 600
-500

TOP LOSERS: VALUE SALES CHANGE VS. YR. AGO ()

.
Fresh Desserts Chilled Juices Margarine, Butter, Fats & Spreads Yogurts, Dairy Desserts & Drinks

Millions
-400 -300 -200 -100 0

Charcuterie

475.6

Eggs

215.8

- 14.3

Fresh Fruit

209.8

- 16.5

Cheese Fresh Vegetables

163.0

- 54.5

144.0

- 438.1

TOP 5 CATEGORIES: EVOLUTION

Value sales () and % change vs. year ago

CATEGORY INSIGHTS The two key categories of charcuterie and cheese continue to drive growth, with combined gains of more then 600m. A warm, sunny Q3 on the back of poor weather during Q2 in many markets has helped drive sales of the seasonal sectors, such as barbecue occasions. Margarine, butter, fats and spreads continue to decline despite an improvement in most markets. However, heavy losses in the Netherlands and particularly the UK have contributed to a weak overall position for Europe in Q3. The sharpest category losses come from the yogurts, dairy desserts and drinks category, which is experiencing heavy long term losses in most markets due to a combination of changing dietary trends and promotional fatigue.

21 009

20 199

Millions

10 866 8 009 6 254

2.3 Charcuterie Cheese

0.8

-3.9 Yogurts, Dairy Desserts & Drinks Ready Meals

1.3

-0.9 Margarine, Butter, Fats & Spreads

Total Sales

% vs. YA

Europe includes: France, Germany, Italy, Netherlands, Spain and United Kingdom Source: IRI retail databases, period ending 29 September 2013 6

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France
CATEGORY VALUE SALES IN THE LAST YEAR
5 271 4 515

Euros, in Millions

2 813

2 580 1 621 1 335

1 165

982

905

607

Charcuterie Ready Meals Chilled Fish and Seafood Fresh Desserts Eggs

Cheese Yogurts, Dairy Desserts & Drinks Margarine, Butter, Fats & Spreads Salads Fresh Vegetables

SHARE OF FRESH & CHILLED VALUE FOR THE YEAR

KEY TRENDS Value sales achieved significant growth across chilled and fresh categories, up 2.3% for Q3 2013 versus the prior year, after a period of stability on Q2. Volume sales also posted commendable growth, at +1.2% for the quarter. Strong chilled and fresh performance supported exceptional global FMCG value sales growth of more than 3% for Q3 2013. The drinks sector also experienced healthy growth. Good weather conditions in Q3 followed a cold and rainy Q2, positively impacting chilled and fresh sales.

Charcuterie Cheese Ready Meals Yogurts, Dairy Desserts & Drinks Chilled Fish and Seafood Margarine, Butter, Fats & Spreads Fresh Desserts Salads Eggs Fresh Vegetables Chilled Juices Cream Fresh Fruit Milk Tofu / Soya Chilled Dips and Sauces

23.0% 19.7% 12.3% 11.3% 7.1% 5.8% 5.1% 4.3% 4.0% 2.7% 1.5% 1.2% 1.1% 0.4% 0.3% 0.2%

Source: IRI retail databases, period ending 29 September 2013 7

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France
TOP WINNERS: VALUE SALES CHANGE VS. YR. AGO ()
Millions
0 50 100 150
-100 -80 -60 -40

TOP LOSERS: VALUE SALES CHANGE VS. YR. AGO ()

.
Yogurts, Dairy Desserts & Drinks

Millions
-20 0

Charcuterie

119.0

Cheese

74.2

Ready Meals

51.6

Salads

31.4

Eggs

23.7

- 81.6

TOP 5 CATEGORIES: EVOLUTION

Value sales () and % change vs. year ago

CATEGORY INSIGHTS Top five winner categories are variously impacted by good weather conditions on Q3, leading to the following evolution on 52 weeks ending 09/29/2013: Cheese growth was supported primarily by strong growth of Mediterranean cheese (mozzarella, feta) and salad cheeses. Similarly, charcuterie categories that are popular picnic and barbeque components, such as fresh sausage, roasted pork, dried ham and dried sausage, contributed heavily to growth of the category. Ready meal growth remains strong but has decelerated slightly due to hot weather, which was more suitable for salads consumption than hot ready meals. Chilled fish and seafood sales were flat for the quarter. Surimi fish stabilized after three quarters of loss. Whether this is a long-term reversal of the trend remains to be seen.

5 271 4 515

Millions

2 813

2 580

1 621

2.3 Charcuterie Cheese 1.7 Ready Meals 1.9 -3.1 Chilled Fish and Seafood Yogurts, Dairy Desserts & Drinks 0.2

Total Sales

% vs. YA

Source: IRI retail databases, period ending 29 September 2013 8

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Germany
CATEGORY VALUE SALES IN THE LAST YEAR
7 933 6 838

Euros, in Millions

2 743

2 584

2 535 1 725 1 229 1 193 1 125 1 044

Charcuterie Chilled Juices Margarine, Butter, Fats & Spreads Fresh Desserts Salads

Cheese Yogurts, Dairy Desserts & Drinks Ready Meals Eggs Cream

SHARE OF FRESH & CHILLED VALUE FOR THE YEAR

KEY TRENDS In Germany, chilled and fresh is growing at 1.6% in value, outpacing the combined pace of European countries studied for this report. Hypermarkets show the highest levels of growth in sales for chilled and fresh, with an increase of 3.1% (contributing to 39.3% of sales). Charcuterie and eggs are the main drivers for the positive development. In contrast, decline in yogurts and milkshakes is negatively impacting growth. Private label contributes around 48% of the value sales for chilled and fresh; both private label and national brands are experiencing value sales growth amidst declining volume. Where promotional sales are declining, normal sales are showing growth, driving the positive value development of chilled and fresh. Soft discounters are experiencing the sharpest decline in chilled and fresh sales, followed by drug stores. Hypermarkets continue to grow.

Charcuterie Cheese Chilled Juices Yogurts, Dairy Desserts & Drinks Margarine, Butter, Fats & Spreads Ready Meals Fresh Desserts Eggs Salads Cream Milk Chilled Fish and Seafood Tofu / Soya Chilled Dips and Sauces

26.3% 22.7% 9.1% 8.6% 8.4% 5.7% 4.1% 4.0% 3.7% 3.5% 3.0% 0.7% 0.1% 0.0%

Source: IRI retail databases, period ending 29 September 2013 9

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Germany
TOP WINNERS: VALUE SALES CHANGE VS. YR. AGO ()
Millions
0 50 100 150 200

TOP LOSERS: VALUE SALES CHANGE VS. YR. AGO ()

-80 -60 -40 -20 0

Charcuterie

151.8

Eggs

107.6

Cheese

82.5

- 0.3

Chilled Dips and Sauces

Ready Meals

62.6

- 1.7

Chilled Juices Yogurts, Dairy Desserts & Drinks

Milk

51.9

- 66.4

TOP 5 CATEGORIES: EVOLUTION

Value sales () and % change vs. year ago

CATEGORY INSIGHTS Chilled charcuterie is showing positive development across channels, whereas unchilled charcuterie is declining in hard discounters and drug stores. The reduced fat segment remains in sharp decline across both chilled and unchilled charcuterie, negatively impacting category performance. Branded yogurts, dairy desserts and drinks are experiencing sales declines, while private label grew slightly during the quarter. Cut, feta and cream cheeses all experienced a boost in sales during Q3, driving growth within the cheese category. Irrespective of tremendous decline in promotional sales, eggs are showing doubledigit growth, due to significant growth in discounters. Private label chilled fish and seafood declined, while private label charcuterie and cheese grew sharply.

7 933 6 838

Millions

2 743 2 584 2 535

0.4 2.0 Charcuterie Cheese 1.2 Chilled Juices -0.1 -2.5

Yogurts, Dairy Desserts & Drinks

Margarine, Butter, Fats & Spreads

Total Sales

% vs. YA

Source: IRI retail databases, period ending 29 September 2013 10

Millions

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Italy
CATEGORY VALUE SALES IN THE LAST YEAR
3 459

Euros, in Millions

2 102

2 048 1 638 1 224 1 166 1 039 714 442 398

Cheese Fresh Vegetables Ready Meals Milk Margarine, Butter, Fats & Spreads

Charcuterie Yogurts, Dairy Desserts & Drinks Fresh Fruit Eggs Fresh Desserts

SHARE OF FRESH & CHILLED VALUE FOR THE YEAR

KEY TRENDS Cheese, charcuterie and fresh fruits contribute to around 60% of the total fresh and chilled markets growth. Whilst the cheese market is stable, fresh fruits is the best performing category (+8.0%). Both charcuterie and, in particular, fresh fruits benefit of a shift from random to fixed weight and possibly of a new channel choice made by consumers for a more convenient solution and promotional offers. Some important chilled and fresh categories experienced value sales declines in Q3, including yogurt (-5.9%), dairy dessert (-6.5%) and fresh drinks (- 14.3%). Negative performance in yogurt, particularly full fat and functional segments, is a key driver of declines across the fresh dairy segment. Only low-fat yogurt and some niche segments (such as soya and Greek yogurt) grew in Q3.

Cheese Charcuterie Fresh Vegetables Yogurts, Dairy Desserts & Drinks Ready Meals Fresh Fruit Milk Eggs Margarine, Butter, Fats & Spreads Fresh Desserts Chilled Dips and Sauces Cream Chilled Juices Tofu / Soya

23.9% 14.5% 14.1% 11.3% 8.4% 8.1% 7.2% 4.9% 3.0% 2.7% 1.0% 0.5% 0.2% 0.0%

Source: IRI retail databases, period ending 29 September 2013 11

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Italy
TOP WINNERS: VALUE SALES CHANGE VS. YR. AGO ()
Millions
0 20 40 60 80 100

TOP LOSERS: VALUE SALES CHANGE VS. YR. AGO ()

.
Chilled Juices Ready Meals Fresh Desserts Milk Yogurts, Dairy Desserts & Drinks

Millions
-150 -100 -50 0

Fresh Fruit Fresh Vegetables Charcuterie

78.0

- 8.6

67.4

- 15.6

64.1

- 28.9

Eggs

45.3

- 46.6

Cream

2.4

- 123.1

TOP 5 CATEGORIES: EVOLUTION

Value sales () and % change vs. year ago

CATEGORY INSIGHTS Prices are becoming a key factor for fresh food categories. During Q3, prices grew 2.1%, driven by fresh fruits (+11.5%), fresh vegetables (+4.4%) and charcuterie (+1.5%). Private label prices also escalated (+5.5%). Private label has achieved significant share of chilled and fresh sales (28.3%), significantly higher than the grocery average (18.2%). Their promotional activities account for 17.7% of value sales (similar versus last year). While the fresh market increase its average number of reference (+1.4%) private labels are decreasing their number of references (-3.0%). Though promotional activity within chilled and fresh has increased (+1.9 points), it remains lower compared to FMCG average (23.3% versus 23.9%). The categories with the highest promotional activity are cheese, charcuterie, yogurt and fresh fruits.

3 459

Millions

2 102 2 048 1 638 1 224

-0.1 Charcuterie Cheese

3.1 Fresh Vegetables

3.4

-7.0 Yogurts, Dairy Desserts & Drinks Ready Meals

-1.3

Total Sales

% vs. YA

Source: IRI retail databases, period ending 29 September 2013 12

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Netherlands
CATEGORY VALUE SALES IN THE LAST YEAR
2 992

Euros, in Millions

1 686 1 237 1 230 821 407 403 369 352 289

Charcuterie Fresh Fruit Fresh Desserts Milk Ready Meals

Fresh Vegetables Cheese Margarine, Butter, Fats & Spreads Yogurts, Dairy Desserts & Drinks Chilled Fish and Seafood

SHARE OF FRESH & CHILLED VALUE FOR THE YEAR

KEY TRENDS In terms of evolution total FMCGs Values Sales YTD to wk40 are increasing with 2.0% growth The Hard Discounters (Aldi & Lidl) are winning market share (sales index 104,7) particularly Lidl with a focus on the fresh categories. However we see a slow down in the market during the 3rd quarter with a growth of only 1.1%. The fresh category is critical to the supermarkets channel, with sales accounting for 42,9% of supermarkets sales Fresh shows a growth of 2.4% YTD week 40 which is above the level of the grow of the total supermarket sales. Fruit (+8,1%), Foreign Cheeses (7,2%) and Salads (5,1%) are the winning categories in the third quarter 2013.

Charcuterie Fresh Vegetables Fresh Fruit Cheese Fresh Desserts Margarine, Butter, Fats & Spreads Milk Yogurts, Dairy Desserts & Drinks Ready Meals Chilled Fish and Seafood Salads Eggs Chilled Juices Cream Chilled Dips and Sauces

28.4% 16.0% 11.8% 11.7% 7.8% 3.9% 3.8% 3.5% 3.3% 2.7% 2.6% 2.3% 1.3% 0.6% 0.2%

Source: IRI retail databases, period ending 29 September 2013 13

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Netherlands
TOP WINNERS: VALUE SALES CHANGE VS. YR. AGO ()
Millions
0 50 100 150

TOP LOSERS: VALUE SALES CHANGE VS. YR. AGO ()

.
Ready Meals Yogurts, Dairy Desserts & Drinks Charcuterie Chilled Fish and Seafood Margarine, Butter, Fats & Spreads

Millions
-20 -15 -10 -5 0

Fresh Fruit Fresh Vegetables Eggs

16.0

124.0

- 4.7

70.1

- 11.2

- 11.6

Salads

2.7

- 12.9

Cheese

2.1

- 14.7

TOP 5 CATEGORIES: EVOLUTION

Value sales () and % change vs. year ago

CATEGORY INSIGHTS Fresh Fruit has increased (+11,1) due to higher prices for apples and a strong performance of summer fruits, aided by good weather in July and August. Within Fresh Vegetables growth of 4.3% is coming from tomatoes, peppers and cabbage crops. Declines within Yellow fats of -14.7% aer being driven in particular by cooking products. These are highly priced products which are suffering during the economic crisis. Eggs increase of 8.3 % is due to higher prices but has also experienced a small growth in volume, showing positive underlying health in the segment Fish continues to suffer from the salmon crisis at the end of 2012, down -3.5%. However in the third quarter of 2013 sales have returned to the levels of a year ago.

2 992

Millions

1 686 1 237 1 230 821 11.1 -0.4 Charcuterie Fresh Vegetables 4.3 Fresh Fruit Cheese -0.5 0.2 Fresh Desserts

Total Sales

% vs. YA

Source: IRI retail databases, period ending 29 September 2013 14

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Spain
CATEGORY VALUE SALES IN THE LAST YEAR
2 712 2 061 1 589

Euros, in Millions

712

555

507

315

221

192

142

Charcuterie Cheese Eggs Chilled Fish and Seafood Chilled Juices

Yogurts, Dairy Desserts & Drinks Ready Meals Fresh Desserts Margarine, Butter, Fats & Spreads Cream

KEY TRENDS
SHARE OF FRESH & CHILLED VALUE FOR THE YEAR

Spain remains the only country in decline in Q3 2013; declines accelerated versus Q2.

Charcuterie Yogurts, Dairy Desserts & Drinks Cheese Ready Meals Eggs Fresh Desserts Chilled Fish and Seafood Margarine, Butter, Fats & Spreads Chilled Juices Cream Chilled Dips and Sauces Milk Salads

29.4% 22.4% 17.2% 7.7% 6.0% 5.5% 3.4% 2.4% 2.1% 1.5% 1.4% 0.4% 0.4%

The yogurt and cheese categories continued their slide in Q3. Only charcuterie achieved significant positive movement for the quarter.

While private label recorded positive developments in the overall fresh and chilled, trends vary at the channel level: hypermarket sales slid more than 4% versus prior year, while the supermarket channel posted growth of more than 2.5%.

Promotional activity remains constant across chilled and fresh versus a year ago, and is generally slightly below the FMCG average level of 19%.

Source: IRI retail databases, period ending 29 September 2013 15

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Spain
TOP WINNERS: VALUE SALES CHANGE VS. YR. AGO ()
Millions
0 50 100 150 200

TOP LOSERS: VALUE SALES CHANGE VS. YR. AGO ()

.
Salads Ready Meals Chilled Juices Cheese Yogurts, Dairy Desserts & Drinks

Millions
-200 -150 -100 -50 0

Charcuterie

152.3

- 1.7

Eggs Margarine, Butter, Fats & Spreads Chilled Dips and Sauces

23.1

- 15.7

7.8

- 23.2

7.4

- 27.1

Cream

4.8

- 166.5

TOP 5 CATEGORIES: EVOLUTION

Value sales () and % change vs. year ago
2 712

CATEGORY INSIGHTS Growth in charcuterie continues, driven mainly by the national brands. Private label sales in this sector slid versus prior year. The hypermarket channel is a standout for charcuterie sales. All segments of the yogurt category declined across channels. The basic segment, usually the strongest, reversed historical trends and posted sales declines for the quarter. The growth of the eggs category is being supported by increased distribution by one particular manufacturer within the supermarket channel. Though distribution is beginning to stabilize, the underlying health of the category remains positive.

2 061

1 589

Millions

712 555 6.0 Charcuterie

-7.5 Yogurts, Dairy Desserts & Drinks Cheese

-1.7 Ready Meals

-2.2 Eggs

4.3

Total Sales

% vs. YA

Source: IRI retail databases, period ending 29 September 2013 16

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United Kingdom
CATEGORY VALUE SALES IN THE LAST YEAR
3 246 2 567

Euros, in Millions

1 633 1 314 1 273 1 182 881 352 344

Milk Yogurts, Dairy Desserts & Drinks Chilled Juices Fresh Desserts Chilled Dips and Sauces

Cheese Margarine, Butter, Fats & Spreads Ready Meals Cream

SHARE OF FRESH & CHILLED VALUE FOR THE YEAR Milk Cheese Yogurts, Dairy Desserts & Drinks Margarine, Butter, Fats & Spreads Chilled Juices Ready Meals Fresh Desserts Cream Chilled Dips and Sauces 25.4% 20.1% 12.8% 10.3% 10.0% 9.2% 6.9% 2.7% 2.7%

KEY TRENDS
With GDP declining by 46k and inflation rising by 3.7%, the UK chilled and fresh market still achieved a 1.0% growth versus last year. Milk is the largest chilled and fresh category, constituting one-quarter of the market. Milk is also the fastest growing category, posting 75.8m increase in sales over 2012. Just over 20% of 2013 year-todate milk sales were sold with promotional support, as retailers continue to leverage the category to drive footfall. However, the real growth driver has been from improved underlying base sales. Margarine, butter, fats and spreads negatively affected the performance of the chilled and fresh market, posting declines of -4.6% versus prior year.

Source: IRI retail databases, period ending 29 September 2013 17

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United Kingdom
TOP WINNERS: VALUE SALES CHANGE VS. YR. AGO ()
Millions
0 20 40 60 80

TOP LOSERS: VALUE SALES CHANGE VS. YR. AGO ()

.
Margarine, Butter, Fats & Spreads

Millions
-80 -60 -40 -20 0

Milk

75.8

Cheese

36.3

Ready Meals Chilled Dips and Sauces Fresh Desserts

23.7

18.9

16.5

- 63.1

TOP 5 CATEGORIES: EVOLUTION

Value sales () and % change vs. year ago
3 246

CATEGORY INSIGHTS
The margarine, butter, fats and spreads category accounts for 10.3% of UK chilled and fresh sales. During Q3 2013, posted enormously negative growth. Although the category continues to perform well on promotion (with incremental sales up +9%), underlying base sales at the value end of the market are driving declines. This quarters cheese growth has been driven by strong increases in base sales (up an impressive 56%) and growth from new product development. Yogurts, dairy desserts and drinks grew at 0.7% despite on-shelf and off-shelf promotional support declines of four points and two points, respectively. Chilled juices is heavily promotionally reliant, with 66% of volume sold on deal. Declining promotional lift trends reflect promotional fatigue and a falling base.

2 567

Millions

1 633 1 314 1 273

2.4 Milk Cheese

1.4

0.7 Yogurts, Dairy Desserts & Drinks

-4.6 Margarine, Butter, Fats & Spreads Chilled Juices

0.6

Total Sales

% vs. YA

Source: IRI retail databases, period ending 29 September 2013 18

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Final Notes

Notes on Category Definitions for Countries Due to the diverse products found in individual countries across this market it was necessary to consolidate the available data into the categories in this report. In some cases it wasnt always possible to align products across all 6 countries hence the need to highlight any anomalies in the report. Those exceptions are listed below: Eggs The UK data in this report does not include this category

Margarine, Butter, Fats & Spreads The UK data in this report does not include fats in this category The Spain data in this report does not include fats in this category

Tofu / Soya The UK data in this report does not include this category The Spain data in this report does not include this category

Chilled Fish and Seafood The UK data in this report does not include this category The Italy data in this report does not include this category

Charcuterie The UK data in this report does not include this category

Fresh Vegetables The UK data in this report does not include this category The Spain data in this report does not include this category The Germany data in this report does not include this category

Fresh Fruit The UK data in this report does not include this category The Spain data in this report does not include this category The Germany data in this report does not include this category

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Resources

To gain insight into opportunities across specific categories, segments, channels or retailers, contact your IRI client service representative regarding custom analyses leveraging the following resources: InfoScan Census is a syndicated retail tracking service that enables manufacturers and retailers to acquire industry insights used to make better business decisions. InfoScan Census utilizes the data that IRI collects from grocery, drug, and mass merchandise retailers to provide the most comprehensive and accurate syndicated data offering in the FMCG sector. With access to accurate, granular detail by category, geography, measure, and time period, clients have the tools needed to develop marketing and sales strategies based on product performance, distribution, and promotion responsiveness. All data about alcohol comes from InfoScan Census. IRI Consulting provides strategic insights and advice leveraging a variety of data sources, predictive analytics, enabling technologies, and business analyses to help FMCG manufacturers and retailers address significant sales and marketing issues effectively.

FOR MORE INFORMATION Please contact Sarah Pittock, Insight Director, Business Insights, IRI at Sarah.Pittock@IRIworldwide.com or +44 (0)782 577 0209with questions or comments about this report.

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