Baltics Growth reporter q2 2010

Q2’2010

10/08/2010

Introduction
This report:
• Compares overall market dynamics (value and unit growth) in the
Fast Moving Consumer Goods sector across Europe.
• Is based on the sales tracking Nielsen performs in every European
market.
• Covers sales in grocery, hypermarket, supermarket, discount and
convenience channels
• Is based on the widest possible basket of product categories that are
continuously tracked by Nielsen in each of these countries and
channels
• Reports on the 2nd quarter of 2010
– Week 15, 2010 till week 27, 2010

• NB: Turkey data was reworked for Q1 2010
– Cigarettes were removed from calculation because of distorting effect

Confidential & Proprietary
Copyright © 2010 The Nielsen Company

Executive Summary
A poor Q2 in terms of volume growth rates, confirms the very slow
healing of consumer confidence
• In 2009 the Easter weekend was part of Q2, this year Easter was part of Q1
sales
– The shift in sales of this top weekend penalized the Q2 growth rates
• Beyond this calendar technicality it’s the first time European value growth
falls short of +1% since debut of the Growth Reporter in 2007
– Steep drop in Norway despite highest Consumer Confidence in Europe
– Germany and Italy are holding down the European number
• Greek / Euro crisis becomes visible in FMCG Spending
• Inflation is still under the 1% level
– Deflation exceeds -6% in Finland and close to -3% in Ireland, Portugal and Switzerland
– Price increase surge back to +2.7% in the UK and +3% in Turkey
• Volume growth rates were lower than Q1 in 15 of the 21 markets
– Hungary, the Czech rep and Switzerland are the exceptions
• Consumer remains doubtful on recovery
– Consumer confidence rebuilding is slow
• The East – West divide remains in place.
– Rampant inflation in Albania, Bosnia and Ukraine
– Falling volumes in Bulgaria, Baltics, Romania and Russia


Europe overview (*)
Fast Moving Consumer Goods market dynamics

(*):Austria, Belgium, Czech Rep., Denmark, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Netherlands, Norway, Poland, Portugal, Slovakia, Spain, Sweden, Switzerland, Turkey, UK.


Latest volume trend overview


Q2 2010 growth rates per country (versus Q2 2009)


Europe Big 5 summary

Germany France UK Italy Spain

Nielsen Market
Index Volume*

Nielsen Market
Index Value**

Are consumers shopping more
frequently?

Are consumers spending more per
trip?

Are shoppers shifting
to value channels?

Nielsen Global Consumer
Confidence index 81 7 63 5 78 2 71 4 69 10

*Nielsen Market Index Volume defined as unit change vs. YAGO
**Nielsen Market Index Value defined as € , £ change vs. YAGO

Very Strong Growth: >= +5% Neutral: between -1 and +1% Very Negative: < -4%

Growth: between +1 and + 4% Negative: between -1 and -4%
•Nielsen Economic Current
Copyright © 2010 The Nielsen Company. Confidential and proprietary.

DETAILS BY COUNTRY


Austria Fast Moving Consumer Goods market dynamics


Belgium Fast Moving Consumer Goods market dynamics


Czech Republic Fast Moving Consumer Goods market dynamics


Denmark Fast Moving Consumer Goods market dynamics


Finland Fast Moving Consumer Goods market dynamics


France Fast Moving Consumer Goods market dynamics


Germany Fast Moving Consumer Goods market dynamics


Greece Fast Moving Consumer Goods market dynamics


Hungary Fast Moving Consumer Goods market dynamics


Ireland Fast Moving Consumer Goods market dynamics


Italy Fast Moving Consumer Goods market dynamics


Netherlands Fast Moving Consumer Goods market dynamics


Norway Fast Moving Consumer Goods market dynamics


Poland Fast Moving Consumer Goods market dynamics


Portugal Fast Moving Consumer Goods market dynamics


Slovakia Fast Moving Consumer Goods market dynamics


Spain Fast Moving Consumer Goods market dynamics


Sweden Fast Moving Consumer Goods market dynamics


Switzerland Fast Moving Consumer Goods market dynamics


Turkey Fast Moving Consumer Goods market dynamics

Cigarettes sales excluded onwards 2010.


UK Fast Moving Consumer Goods market dynamics


Extended countries
Albania Lithuania
Bosnia Macedonia
Bulgaria Romenia
Croatia Russia
Estonia Serbia
Israel Slovenia
Latvia Ukraine

• Based on Bimonthly reporting cycles
• Categories covered in food and drug channels


Albania Fast Moving Consumer Goods market dynamics


Bosnia Fast Moving Consumer Goods market dynamics


Bulgaria Fast Moving Consumer Goods market dynamics


Croatia Fast Moving Consumer Goods market dynamics


Estonia Fast Moving Consumer Goods market dynamics


Israel Fast Moving Consumer Goods market dynamics


Latvia Fast Moving Consumer Goods market dynamics


Lithuania Fast Moving Consumer Goods market dynamics


Macedonia Fast Moving Consumer Goods market dynamics


Romania Fast Moving Consumer Goods market dynamics


Russia
Fast Moving Consumer Goods Market Dynamics


Serbia Fast Moving Consumer Goods market dynamics


Slovenia Fast Moving Consumer Goods market dynamics


Ukraine Fast Moving Consumer Goods market dynamics


Glossary
• Nominal value growth:
– Percentage change in value sales (expenditures) as measured by the total basket of reported
product categories
• Unit value growth (≈ ‘price’ change):
– Percentage change in the average retail price per unit in the total basket of reported product
categories
– The unit of volume in the basket varies by category (e.g. litres, kilograms, tonnes, etc)
– The change in average price per unit may result from:
– Price changes of individual products
– Change in the mix of purchased products; more or less expensive products, more or less
promotions, etc.
– Channel switching; more or less purchases in discount stores, or hypermarkets, or
convenience outlets, etc.
– Product or channel mix changes may be induced by price change or may just be the result
of market dynamics.
– The unit value growth reflects how consumers experience ‘cost of living’ in their actual grocery
shopping behaviour.
• Volume growth:
– Percentage change in purchased volume (quantity) of products
• The three components are related:
– ValueGrowth = UnitValueGrowth * VolumeGrowth

See attachment for calculation rules


Baltics Growth reporter q2 2010

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Baltics Growth reporter q2 2010