Suning.com sees positive results after Carrefour China acquisition

NANJING,China,Jan. 8,2020 -- On September 27,Suning.com (002024.SZ) announced that it has completed the acquisition of Carrefour China Holdings N.V.Carrefour China,marking the start of the Suning era for Carrefour China. In 2019,the company acquired an 80% equity stake in Carrefour China forEUR 620 million (RMB 4.8 billion),following the transaction of Dia Chinaand Wanda Department Stores,as Suning continued to accelerate the expansion of itsbrick-and-mortar portfoliofor its full-scenario retail model.

Mr. Jindong Zhang,Chairman of Suning.com,said:"This is a key step to Suning's Smart Retail Plan. Carrefour's FMCG experience and supply chain capabilities can be integrated with Suning's full-scenario retail model,solid logistics network and advanced technology. Withour smart retail capabilities,Suning can transform Carrefour stores into fully integrated online-and-offline supermarkets to meet evolving consumer demands." Additionally,Suning announced five long-term strategies of Carrefour China,including digitalizing Carrefour physical stores,improving current store models,expanding to lower-tier cities with Suning's Retail Cloud Franchise Store,integrating with Suning's convenience store,and opening new stores in the existing market.

Suning.com's major actions after the acquisition of Carrefour China

On September 28,2019,theday after the acquisition,Suning's home appliances stores opened in over 200 Carrefour stores,the number of visitors on that day was over 100,000.

In early November,Suning Finance successfully integrated Carrefour's finance system so customers in Carrefour stores can pay with their Suning Finance account.

In mid-NovemberCarrefour participated in the single's day event(Nov 11) for the first time,with allof Suning's business segments.Suning supermarkets and Carrefour were able to purchase fresh fruit from Xinjiang together - a display of their integration. Additionally,some Carrefour stores in Nanjing and Shanghai have built quick picking warehouses,storing approximately 3,000SKUs. Customers can place the orders online through Suning's Convenience Store app,Carrefour Mini WeChat program and the third-party platforms. Their package can be delivered in 1 hour within 3 kilometers. During the Single's Day period (Nov 1- Nov 11),Carrefour sales and orders numbers brokehistorical records.

At China International Import Expo,as a purchaser and exhibitor,Carrefour signed 150 million RMB purchase contracts.

At the end of NovemberItalian Trade Agencyvisited Carrefour China and negotiated the import of Italian products through Carrefour's supply chain. Relying on Suning and Suning International,Carrefour willcontinue to invest in its international supply chain management.

On Black Friday,Carrefour's online flagship store opened on Suning.com,focused on selling high value imports. Customers can place orders online and enjoy the efficient delivery service through Suning Logistics.

Duringthe 12/12 period (Dec 1- Dec 12),Suning's first air delivery of international products arrived. It included fresh Chilean cherries,Argentinian shrimp,Brazilian sirloin,and Iranian pistachios,reflecting Suning's outstandinginternational supply chain.

On December 27,Easy Carrefour,a convenience store,opened in Suning.com's Shanghai Zhongshan store.

In the future,Suning.com will have more offline integration with Carrefour China. Other than home appliance stores,Carrefour storeswill also incorporate other Suning business models including mother-infant,sports retail and movie theaters.

With a presence inChinadating back to 1995,as of March 2019,Carrefour China operated a network of 210 hypermarkets and 24 convenience stores,covering 22 provinces and 51 large and medium-sized cities,with about 30 million members. In 2018,it generated net sales of nearlyRMB 30 billion.

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