1 presented by empower it august 2008 european market overview heidelberg, germany

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Presented by Empower ITAugust 2008

European Market Overview

Heidelberg, Germany

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Overview of the Market Place

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““The dollar is down, so he’s The dollar is down, so he’s worshipping the Euro.”worshipping the Euro.”

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Source: Information Service Food Marketing Institute April 2007 – ranking and sales information taken directly from Directory of Supermarket, Grocery & Convenience Store Chains

Rank Retailers2007 Sales (Billions)

1 Wal-Mart Supercenters $183.72 Kroger $66.63 Costco $59.04 Sam's Club $42.25 Safeway $40.56 Supervalu $37.07 Ahold USA $24.08 Publix Super Markets $21.79 Delhaize America $17.310 Meijer $13.211 H.E. Butt Grocery $12.412 Great A&P Tea Co $9.413 Winn-Dixie Stores $7.214 Giant Eagle $7.115 *DeCA $6.916 Whole Foods $6.6

*DeCA base sales adjusted by 30%

DeCA ranks 15th among America’s Top Food Retailers

DeCA vs Top AmericanRetailers

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Consumer Packaged GoodsDollar Share by Channel

The average consumer makes one less shopping

trip per month today than five years ago

Club 7%

Mass 8%

Supercenter 12%

Grocery 51%

Wal-Mart 16%

Drug 5%

Dollar 6%

Source: Food Industry Review 2007

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$38.517.83

6.15.58

4.243.9

10.86$50.04

12.9210.58

9.167.16

3.463.21

2.071.3

$4.663.24

1.42$3.52$3.26

0.19

GROCERY (TOTAL)Grocery (nonfoods)

Beverages (nonalcohol) Snacks (candy, sweet, salty)

Meal food itemsBeverages (alcohol)

All other grocery (food) PERISHABLES (TOTAL)

Meat, fish and poultry (fresh)Produce

Dairy Frozen foods

Deli-in-store (service)Baked goods (fresh)

Bakery-in-store (service) Deli-ref. (self-service)

FloralGENERALNontracked

TrackedHEALTH & BEAUTY CARE

PHARMACY

How $100 is Spent in Supermarkets

Source: Progressive Grocer, April 15, 2008 (www.ProgressiveGrocer.com)

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Consumers' Top Food Safety Concerns

49%

43%

38%

38%

37%

Bacteria/ Germ Contamination

Product Tampering

Avian Influenza

Terrorist Tampering

Pesticides & Herbicides Residues

Food Safety Concerns

Source: FMI's U.S. Grocery Shopper Trends 2007

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Factors for Selecting a Grocery StoreBy Gender

Source: Food Marketing Institute’s U.S. Shopper Trends 2007

Key Factors Women MenHigh-quality fruits and vegetables 83% 61%Clean, neat store 80% 62%High-Quality meats 78% 60%Accurate shelf tags 75% 54%Used before/ sell-by date marked 73% 51%Low prices 70% 51%Convenient location 64% 55%Courteous, friendly employees 62% 45%Personal safety outside store 62% 33%Items on sale or money saving specials 61% 42%

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Characteristics of Store FormatsRetail vs Military

Total Store Area

Avg. Total SKUs

Avg. Weekly Store Sales

% of Total Store Sales

Total Traditional Grocery $202,761 100%Traditional Supermarkets 52,100 45,500 $266,899 100%Fresh Format 36,000 30,000 $162,188 100%Limited-Assortment 15,000 1,400 $115,785 100%Super Warehouse 60,700 41,000 $538,741 100%Other (Small Grocery) 9,000 3,000 $23,599 100%Total Non-Traditional Grocery $116,327Wholesale Club 131,000 5,100 $985,183 59%Supercenter 184,100 125,000 $889,479 60%Dollar 7,400 4,900 $13,904 66%Drug 11,700 20,000 $40,894 34%Mass 115,600 95,000 $216,165 23%Military 29,400 15,000 $461,315 100%

Average weekly

customer transactio

ns are $58.57

compared to $27.34 outside

the gate!

Source: Willard Bishop’s Future in Food Industry Review 2007

DeCA is doing more with less!

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Now let’s take a closer look at DeCA Europe

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Source: 2007 Commissary Customer Service Survey (CCSS)Source: 2007 Commissary Customer Service Survey (CCSS)

DeCA EuropeCustomer Comparison

Sponsor Status Active Duty Retired OtherDeCA Europe 65.0% 15.3% 19.2%

ConUS 36.7% 56.7% 2.9%

Family Size One Two ThreeDeCA Europe 12.5% 25.2% 25.8%

ConUS 9.1% 34.5% 22.4%

Sponsor Age 18-24 25-34 35-44DeCA Europe 13.9% 27.8% 29.4%

ConUS 6.9% 14.0% 19.3%

58% of Military Shoppers in Europe fall into the 25-44 age group

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308 303 302 295 286 286 273 268 266 266

82 79 79 80 80 77 75 74 70 63 57

308

FY97 FY98 FY99 FY00 FY01 FY02 FY03 FY04 FY05 FY06 FY07

DECA Europe

Total number of stores open by year

Store count includes CDCs and Nexmarts

DeCA Store Count

The majority of store closures during the past 6 years has occurred in Europe

Source: DeCA Headquarters

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0.0

100.0

200.0

300.0

400.0

500.0

600.0

FY03 FY04 FY05 FY06 FY07

Euro

pe (M

illions)

0.00

1.00

2.00

3.00

4.00

5.00

6.00

ConU

S (Billions)

Europe-Dollars

ConUS-Dollars

Source: American Logistics Association Site

Total DeCA Sales ConUS vs Europe Five-Year Trend (FY 2002 – 2007)

DeCA SalesFY07 vs FY03

Europe: +5.3%ConUS: +9.7%

Despite store closures, Europe has sustained 5.3% growth in the past 5 years

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Europe Average Dollar Sales per Store

…and average sales per store in Europe have increased dramatically

$6.98$7.46

$8.31

$6.32

FY04 FY05 FY06 FY07

Europe Avg Sales Per Store (Millions of $)

Source: DeCA Headquarters & ALA Site

15

468

1012141618202224262830

JUL 0707

AUG04 07

SEP 0107

SEP 2907

OCT27 07

NOV24 07

DEC22 07

JAN 1908

FEB 1608

MAR15 08

APR 1208

MAY10 08

JUN 0708

Euro

pe

0

50

100

150

200

250

300

350

ConU

S

Europe-Dollars Europe-PackagesConUS-Dollars ConUS-Packages

(Millions)

Sales PerformanceConUS vs Europe 52-Week Trends

Source: TotCat 52 weeks ending 6/07/08

(Millions)

Europe +0.8% -4.3%ConUS +4.8% -0.3%

$ % Chg

Pkg % Chg

52 Wk Trend vs YAG

4 Wk Pd. Ending:

16

0.0

-0.7 -0.6

-2.2

-0.7

-2.4

0.3

7.0

0.71.2 1.0

4.3

2.7

4WK JUL 0707

4WK AUG04 07

4WK SEP 0107

4WK SEP 2907

4WK OCT27 07

4WK NOV24 07

4WK DEC22 07

4WK JAN 1908

4WK FEB 1608

4WK MAR15 08

4WK APR 1208

4WK MAY10 08

4WK JUN 0708

Store closures had a major impact on sales from July thru December 2007

Europe $ Sales % Chg vs Year Ago

Closures 2007Bad Nauheim, GE (June 2007)McCully Barracks, GE (July 2007)Giessen, GE (September 2007)Buedingen, GE (October 2007)Gelnhausen, GE (October 2007)

Sales PerformanceEurope 52-Week $ Sales Changes


Europe had growth of 5.7% in the first half of 2008 versus

prior period and growth of +3.1% versus

year ago period

Darmstadt, Hanau, and Wuerzburg scheduled to close August 2008

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Region Summary October-May, FY 2008

Region Sales Transactions Average SaleEast $1,808M 26.6M $67.91West $1,722M 27.9M $61.63Europe $ 325M 7.2M $45.20

Region Sales Transactions Average SaleEast +4.8% +1.6% +3.1%West +5.7% +2.4% +3.2%Europe +1.1% -2.9% +4.1%

Actual Data

Change vs. Prior Year

Source: DeCA Sales, ALA Website

The weak US dollar combined with higher fuel costs are forcing European patrons to stock up more vs a year ago

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Europe Sales by Country

In 2008, troops will be migrating from Germany to Italy

13.0%

0.2%

2.1%

62.8%

1.7%

2.2%

13.7%

2.4%0.6%

1.4% AZORES

BELGIUM

EGYPT

ENGLAND

SAUDI

NTHRLND

GERMANY

SPAIN

TURKEY

ITALY

Dollar Sales$ Sales % Chg

4,400,257 16.8

7,660,814 4.2

2,045,043 -1.4

41,848,912 2.3

805,200 4.0

6,623,360 9.2

202,722,912 -1.3

5,627,439 6.7

6,957,092 -1.4

44,358,512 6.4


% of Europe Dollars by Country

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DeCA Stores in Europe

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Store Performance Europe Store Ranking


Top six stores accounted for 40% of Europe dollar volumeEurope Store Ranking based on Dollar Volume

Store Rank TOTAL CATEGORIES

Share of Total Europe $s $ Volume $ % Chg

EUROPE 323,049,536 0.8%1 RA-RAMSTEIN AB, GERMANY (E28) 10.0% 32,276,634 4.7%2 UK-RAF LAKENHEATH, ENGLAND (E1H) 8.2% 26,617,618 3.0%3 RA-VOGELWEH AB, GERMANY (E23) 7.0% 22,707,668 6.1%4 RA-HEIDELBERG, GERMANY (E2M) 5.7% 18,495,194 2.5%5 ME-AVIANO AB, ITALY (E5W) 4.4% 14,279,532 10.2%6 WB-WIESBADEN, GERMANY (E24) 4.4% 14,231,178 -1.8%7 RA-PATCH BARRACKS, GERMANY (E4V) 4.1% 13,280,908 13.9%8 ME-NAPLES, ITALY (E5X) 4.1% 13,182,632 11.1%9 RA-MANNHEIM, GERMANY (E2T) 3.9% 12,649,116 1.9%

10 RA-BAUMHOLDER, GERMANY (E27) 2.9% 9,410,792 6.3%11 WB-VILSECK, GERMANY (E41) 2.7% 8,618,887 -24.9%12 WB-GRAFENWOEHR, GERMANY (E4L) 2.6% 8,482,330 188.1%13 WB-SCHWEINFURT, GERMANY (E3W) 2.6% 8,446,152 36.3%14 UK-BITBURG AB, GERMANY (E2E) 2.6% 8,358,079 -4.2%15 UK-CHIEVRES, BELGIUM (E3K) 2.4% 7,660,814 4.3%16 ME-VICENZA, ITALY (E5Q) 2.3% 7,318,807 -5.3%17 ME-SIGONELLA, ITALY (E5V) 2.1% 6,784,543 4.4%18 UK-SCHINNEN, NTHRLND (E3V) 2.1% 6,623,360 9.2%19 WB-HANAU, GERMANY (E3P) 2.0% 6,414,362 -41.1%20 WB-BAMBERG, GERMANY (E3E) 2.0% 6,330,677 9.4%21 WB-ANSBACH, GERMANY (E4C) 1.9% 6,292,892 -2.3%22 UK-SPANGDAHLEM AB, GERMANY (E2Y) 1.9% 6,268,359 5.7%23 ME-ROTA, SPAIN (E5U) 1.7% 5,627,439 6.7%24 UK-RAF ALCONBURY, ENGLAND (E1B) 1.6% 5,188,616 4.3%25 WB-HOHENFELS, GERMANY (E4S) 1.6% 5,079,732 6.9%26 ME-INCIRLIK, TURKEY (E5Y) 1.4% 4,481,338 -7.2%

Store Rank TOTAL CATEGORIES

Share of Total Europe

$s $ Volume $ % ChgEUROPE 323,049,536 0.8%

27 UK-LAJES FIELD, AZORES (E5L) 1.4% 4,400,257 16.8%28 UK-RAF MENWITH HILL, ENGLAND (E1Q) 1.3% 4,146,997 9.9%29 WB-WUERZBURG, GERMANY (E33) 1.1% 3,429,074 -48.8%30 WB-DARMSTADT, GERMANY (E2G) 0.9% 2,750,506 -38.1%31 UK-RAF CROUGHTON, ENGLAND (E1M) 0.8% 2,510,784 -5.4%32 ME-GARMISCH, GERMANY (E4J) 0.7% 2,270,201 7.2%33 ME-CAIRO, EGYPT (E5B) 0.6% 2,045,043 -1.4%34 WB-ILLESHEIM, GERMANY (E4P) 0.6% 2,037,495 3.9%35 ME-LIVORNO, ITALY (E5J) 0.6% 1,918,176 7.3%36 UK-RAF MILDENHALL, ENGLAND (E1J) 0.6% 1,893,900 -12.7%37 RA-SEMBACH AB, GERMANY (E2Z) 0.5% 1,770,548 -16.4%38 UK-RAF FAIRFORD, ENGLAND (E1F) 0.5% 1,490,997 -0.4%39 ME-ANKARA, TURKEY (E5T) 0.4% 1,384,359 17.2%40 ME-IZMIR, TURKEY (E5H) 0.3% 1,091,394 4.1%41 ME-MINEO, ITALY (E6G) 0.3% 874,822 0.3%42 WB-DEXHEIM, GERMANY (E2H) 0.3% 870,353 -8.7%43 ME-RIYADH, SAUDI (E5M) 0.2% 805,200 4.0%44 RA-PANZER, GERMANY (E4U) 0.2% 616,656 33.0%45 RA-KELLEY BARRACKS, GERMANY (E4Q) 0.2% 594,913 38.7%46 WB-GIESSEN, GERMANY (E3Q) 0.1% 443,333 -84.8%47 RA-IDAR OBERSTEIN, GERMANY (E2N) 0.1% 214,376 -9.7%48 RA-NEUBRUECKE, GERMANY (E2U) 0.1% 162,030 24.4%49 WB-BAD NAUHEIM, GERMANY (E2D) 0.0% 86,680 -92.2%50 WB-MCCULLY BARRACKS, GERMANY (E2S) 0.0% 72,287 -62.4%51 WB-BUEDINGEN, GERMANY (E3M) 0.0% 46,882 -89.9%52 WB-GELNHAUSEN, GERMANY (E3N) 0.0% 10,577 -89.8%53 WB-BABENHAUSEN, GERMANY (E2B) 0.0% 4,049 -95.4%

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Top three categories are Beverages followed by Salty Snacks

Category PerformanceTop 15 Categories by Dollars


SHR INDEX

TOP 15 CATEGORIES $ RANK $ VOLUME$ % CHG YAGO $ RANK $ VOLUME

$ % CHG YAGO

EUROPE VS CONUS

TOTAL ALL CATEGORIES 323,049,554 0.8 3,938,738,432 4.8CARBONATED BEVERAGES 1 11,546,925 -6.0 2 104,446,288 -2.4 135WATER/ NEW AGE BEV 2 8,756,101 3.3 8 87,305,008 7.6 122CANNED/ BOTTLED JUICE/ DRINKS 3 8,736,028 2.3 7 90,766,264 10.4 117SALTY SNACKS 4 7,775,463 -0.6 9 82,164,400 5.7 115RTE CEREAL 5 7,677,032 1.3 6 93,221,016 2.8 100CONFECTIONERY II 6 7,402,380 6.6 11 72,023,008 5.7 125NON BRANDED MILK/ CREAM 7 7,113,075 1.5 3 103,900,488 27.7 83BISCUITS 8 6,749,395 0.0 5 93,584,680 4.9 88NATURAL CHEESE 9 6,745,635 10.8 10 79,401,208 18.2 104BREAD 10 6,698,883 -3.3 4 95,886,624 8.2 85FROZEN FISH/ SHRIMP/ SEAFOOD 11 6,121,184 -1.0 26 36,452,780 4.0 205DIAPERS/ TRAINING PANTS 12 6,120,675 5.8 41 27,800,638 -2.2 268INFANT & TODDLER NUTRITIONALS 13 4,906,056 0.0 42 27,744,738 -0.1 216BATH TISSUE 14 4,761,752 4.7 12 66,203,040 6.1 88HEAVY DUTY LAUNDRY DETERGENT 15 4,575,690 0.6 15 60,809,524 2.8 92

EUROPE CONUS

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Rank UPC Category1 008321720517 MLKFRSH 64Z LF 2BF Milk2 008321720501 MLKFRSH 64Z 3.25BF Milk3 008321720518 MLKFRSH SKM 64Z Milk4 004130054107 WONDERBREAD 24Z ORG Bread5 030087127341 ENFAMIL LIPIL 12.9Z PWD Infant Nutritionals6 004900002890*CC CLS COKE 12/12P Soda7 004900001278 CC CLS COKE 12/24P Soda8 001210001030 TYSON 40Z BLS/SKNLS BR Frz Chicken9 072019605401 SAN BENEDTO MNRL 16Z 6P Water10 008321720727 MLKFRSH 64Z LF 1 PER HLF G Milk11 002370060984 TYSON 64Z BLS/SKNL BR Frz Chicken12 004500012508 HOMEPRIDE 24Z ORG Bread13 004500011199 WONDERBREAD 1C ORG Bread14 072019615401 SAN BENEDTO 50.7Z Water15 002820010690 MARLBORO LT NM KGS BX FT RV 1C Cigarettes16 061429965967 CULLIGAN 16.9Z 12P Water17 001210009605*TYSON 80Z HT WNGS Frz Chicken18 002370003803 TYSON 28Z CRSP CK STRP Frz Chicken19 002840004577 LAYS VRTY PK 1.12Z 24P Salty Snacks20 004900001063 DT COKE 12/24P CO Soda21 002370047652 TYSON 40Z BLS/SKNL TNDR Frz Chicken22 007007455958 SIMILAC 12.9Z PWD W/I ADV Infant Nutritionals23 002820010012 MARLBORO NM KGS BX FT RV 1C Cigarettes24 061126910802 REDBULL 8.3Z 4P Energy Drinks25 001200080996 MOUNTAIN DEW 12/12P Soda

Top 25 European Items - Dollars

Source: Empower IT, 52 Weeks End Dec 2007

Of the top 50 items…

• 9 Soda• 5 Milk• 5 Bread• 5 Frz Chicken• 4 Water• 3 Salty Snacks• 3 Infant Nutritionals • 3 Chill Juice• 2 Cigarettes

• 2 Charcoal• 2 Bacon• 1 Toilet

Paper• 1 Sour

Cream• 1 Frz Fish• 1 Energy

Drink• 1 Cheese• 1 Butter

• These 25 items generate 6.4% of all Europe dollar volume

• The top 50 generate 9.3%

Store Performance Dollar Ranking

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Rank UPC Category1 008321720517 MLKFRSH 64Z LF 2BF Milk2 008321720501 MLKFRSH 64Z 3.25BF Milk3 004130054107 WONDERBREAD 24Z ORG Bread4 008321720518 MLKFRSH SKM 64Z Milk5 004500011199 WONDERBREAD 1C ORG Bread6 072019605401 SAN BENEDTO MNRL 16Z 6P Water7 008321720727 MLKFRSH 64Z LF 1 PER HLF G Milk8 004500012508 HOMEPRIDE 24Z ORG Bread9 004500011286 WONDERBREAD 1C ORG Bread10 003915301218 SAN BENEDTO MNRL 16.9Z Water11 007878300108 GRIMMWAY BABY CRTS 8.75Z Packaged Produce12 007047000650 YOPLAIT LT 6Z STRAWBERRY Yogurt13 007066201003 TOP RAMEN 3Z 1P CHK Oriental Noodles14 007047000654 YOPLAIT LT 6Z STRAW BANANA Yogurt15 004178900211 RAMEN 3Z 1P CHK Oriental Noodles16 072019615401 SAN BENEDTO 50.7Z Water17 007342000011 DAISY SOUR CREAM 16Z Sour Cream18 002840001390 SANTITAS 10Z Salty Snacks19 004900002890*CC CLS COKE 12/12P Soda20 007047000652 YOPLAIT LT 6Z BLUEBERRY Yogurt21 002100065883 KRAFT MAC/CHS 7.25Z ORIGINAL Prep Dinners22 007047000655 YOPLAIT LT 6Z PEACH Yogurt23 002100061223 PHILLY CREAM CHS BRK 8Z Cream Cheese24 007047000653 YOPLAIT LT 6Z CHERRY Yogurt25 004500012504 HOMEPRIDE 24Z ORG Bread

Top 25 European Items - Packages

Store Performance Package Ranking

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% of Store

Dollar Vol

# of Top 50 SKUS Stocked

RA-RAMSTEIN AB, GERMANY (E28) 9.8 50

UK-RAF LAKENHEATH, ENGLAND (E1H) 7.0 46

RA-VOGELWEH AB, GERMANY (E23) 9.7 50

RA-HEIDELBERG, GERMANY (E2M) 8.6 50

WB-WIESBADEN, GERMANY (E24) 9.5 49

ME-AVIANO AB, ITALY (E5W) 10.3 49

RA-MANNHEIM, GERMANY (E2T) 9.9 50

ME-NAPLES, ITALY (E5X) 8.7 47

RA-PATCH BARRACKS, GERMANY (E4V) 8.7 50

WB-VILSECK, GERMANY (E41) 9.9 49

RA-BAUMHOLDER, GERMANY (E27) 11.6 50

WB-HANAU, GERMANY (E3P) 9.8 49

UK-BITBURG AB, GERMANY (E2E) 9.2 50

UK-CHIEVRES, BELGIUM (E3K) 8.8 47

ME-VICENZA, ITALY (E5Q) 9.8 50

WB-SCHWEINFURT, GERMANY (E3W) 9.4 49

ME-SIGONELLA, ITALY (E5V) 9.5 46

WB-ANSBACH, GERMANY (E4C) 9.8 47

UK-SCHINNEN, NTHRLND (E3V) 9.4 49

WB-BAMBERG, GERMANY (E3E) 11.0 49

Most of the top European stores carry close to the

full assortment of overall top items


Most stores have more than 9% of their sales in the top 50 items. Only

Lakenheath shows a considerably lower % of volume generated by the

top items.

Store Performance Assortment

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Store Performance Fastest Growing Stores

Grafenwoehr opened a new store plus an increase in troops stationed on the base

Dollar Sales Change (in millions) Dollar % Change

$5.54

$2.25

$1.62

$1.44

$1.33

$1.32

$1.31

$0.77

$0.63

$0.56

WB-GRAFENWOEHR,GERMANY (E4L) B

WB-SCHWEINFURT,GERMANY (E3W) D

RA-PATCH BARRACKS,GERMANY (E4V) D

RA-RAMSTEIN AB,GERMANY (E28) D

ME-AVIANO AB, ITALY(E5W) D

ME-NAPLES, ITALY(E5X) D

RA-VOGELWEH AB,GERMANY (E23) D

UK-RAF LAKENHEATH,ENGLAND (E1H) D

UK-LAJES FIELD,AZORES (E5L) B

UK-SCHINNEN,NTHRLND (E3V) C

188.1

36.3

13.9

4.7

10.2

11.1

6.1

3.0

16.8

9.2


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• Grafenwoehr - Has a new store, 830 new families stationed there. Also eight new single soldier barracks were added.

• Schweinfurt - Sales will remain stable in 2008. Dagger brigade was relocated to Grafenwoehr.

• Patch - 300 new AFRICOM members, 700 more arrived in June.

• Ramstein - Sales have been increased by case lot sales, supporting the regions promo package.

• Aviano & Lakenheath - Sales are enhanced due to the current exchange rate.

• Vogelweh - Concentrating on aggressive customer outreach programs.

• Lajes Field & Schinnen - Tremendous effort in maintaining in-stock ratio and additional efforts on customer service and merchandising.

Store Performance Growing Stores

27

RA-RAMSTEIN AB, GERMANY (E28) $ VOLUME$ % CHG $ SHR

$ SHR CHG

PKG % CHG

UPC COUNT % CHG

TOTAL CATEGORIES 32,276,634 4.7 100.0 0.0 -0.3 -0.5 CM RF REFRIGERATED FOODS 4,379,101 10.9 13.6 0.8 0.8 -0.4 CM FF FROZEN FOODS 4,109,472 4.9 12.7 0.0 0.5 0.7 CM BV SHELF STABLE BEVERAGES 3,846,779 2.1 11.9 -0.3 4.9 -0.9 CM HB HEALTH & BEAUTY PRODUCTS 3,063,156 1.8 9.5 -0.3 -4.7 2.1 CM DG DRY GROCERIES 2,749,758 4.7 8.5 0.0 0.0 2.7 CM CG CANNED & BOTTLED GROCERIES 2,714,297 3.3 8.4 -0.1 -2.7 -1.5 CM SF SNACK FOODS 2,434,516 6.1 7.5 0.1 -0.4 -0.9 CM PP PAPER & PLASTIC 1,669,926 4.0 5.2 0.0 -2.2 0.9 CM BB BABY PRODUCTS 1,329,212 8.9 4.1 0.2 -2.8 -3.8 CM HC HOUSEHOLD CLEANERS 1,238,707 4.2 3.8 0.0 -3.6 -4.8 CM FB FRESH BAKERY 1,073,527 -0.6 3.3 -0.2 -4.1 2.1 CM HS HOUSEHOLD SUPPLIES 950,089 -0.6 2.9 -0.2 -0.9 -1.2 CM CN CONFECTIONERY 776,939 8.6 2.4 0.1 5.4 0.7 CM SP SPECIALTY FOODS 710,199 8.9 2.2 0.1 4.6 -0.4 CM PF PET FOODS 632,296 7.6 2.0 0.1 -8.4 -15.9 CM TB TOBACCO 351,610 2.8 1.1 0.0 -6.2 -5.7 CM PR PRODUCE 247,051 -16.5 0.8 -0.2 -12.3 -5.6

Store Performance Ramstein AB, Germany

Ramstein aggressively utilized region’s promotion

program and took advantage of all shippers offered


Commodities ranked on Dollar Volume

28

Store Performance Lakenheath, England

Efficient stocking and merchandising strategies are proving to be successful for Lakenheath



TOTAL CATEGORIES 26,617,618 3.0 100.0 0.0 -2.2 1.1 CM FF FROZEN FOODS 3,639,321 0.2 13.7 -0.4 -3.4 -0.2 CM BV SHELF STABLE BEVERAGES 3,175,399 5.1 11.9 0.2 2.9 6.0 CM RF REFRIGERATED FOODS 3,072,267 9.6 11.5 0.7 1.0 0.0 CM CG CANNED & BOTTLED GROCERIES 2,536,291 2.2 9.5 -0.1 -3.8 -1.6 CM DG DRY GROCERIES 2,528,621 3.8 9.5 0.1 -1.0 3.6 CM HB HEALTH & BEAUTY PRODUCTS 2,189,890 2.9 8.2 0.0 -3.6 3.8 CM SF SNACK FOODS 1,876,704 2.9 7.1 0.0 -2.0 2.4 CM PP PAPER & PLASTIC 1,533,808 0.9 5.8 -0.1 -4.5 3.2 CM BB BABY PRODUCTS 1,311,329 -3.0 4.9 -0.3 -9.7 -2.2 CM HC HOUSEHOLD CLEANERS 1,136,230 0.4 4.3 -0.1 -7.4 -2.3 CM HS HOUSEHOLD SUPPLIES 831,380 1.7 3.1 0.0 -1.9 2.0 CM FB FRESH BAKERY 782,953 0.6 2.9 -0.1 -3.2 -0.3 CM CN CONFECTIONERY 599,005 10.6 2.3 0.2 9.9 6.9 CM SP SPECIALTY FOODS 497,300 6.2 1.9 0.1 -0.7 0.1 CM PF PET FOODS 451,223 8.1 1.7 0.1 -10.3 -16.4 CM TB TOBACCO 297,835 -6.3 1.1 -0.1 -9.9 0.8 CM PR PRODUCE 158,061 -10.4 0.6 -0.1 -36.5 -8.1

29

Store Performance Vogelweh AB, Germany

Vogelweh’s success is attributable to outstanding service provided to patrons by the store personnel and strong

growth from refrigerated section



RA-VOGELWEH AB, GERMANY (E23) $ VOLUME $ % CHG $ SHR$ SHR CHG

PKG % CHG

UPC COUNT % CHG

TOTAL CATEGORIES 22,707,668 6.1 100.0 0.0 1.5 -0.8 CM RF REFRIGERATED FOODS 3,035,092 13.1 13.4 0.8 2.9 -1.0 CM FF FROZEN FOODS 3,007,428 7.1 13.2 0.1 3.3 1.6 CM BV SHELF STABLE BEVERAGES 2,538,732 2.7 11.2 -0.4 2.3 3.4 CM CG CANNED & BOTTLED GROCERIES 2,011,101 6.3 8.9 0.0 0.8 -2.3 CM DG DRY GROCERIES 1,981,091 6.2 8.7 0.0 2.7 1.6 CM HB HEALTH & BEAUTY PRODUCTS 1,957,090 -0.1 8.6 -0.5 -5.3 -0.4 CM SF SNACK FOODS 1,588,489 5.1 7.0 -0.1 3.7 -0.9 CM PP PAPER & PLASTIC 1,133,633 2.5 5.0 -0.2 -0.9 -1.2 CM BB BABY PRODUCTS 1,109,660 10.2 4.9 0.2 1.6 -2.8 CM HC HOUSEHOLD CLEANERS 939,545 3.2 4.1 -0.1 -4.3 -6.8 CM FB FRESH BAKERY 718,505 1.5 3.2 -0.1 -0.4 0.3 CM HS HOUSEHOLD SUPPLIES 718,211 1.5 3.2 -0.1 0.4 -0.9 CM TB TOBACCO 484,731 26.8 2.1 0.3 14.4 1.9 CM PF PET FOODS 474,595 9.5 2.1 0.1 -6.4 -14.6 CM CN CONFECTIONERY 425,709 17.4 1.9 0.2 13.0 2.0 CM SP SPECIALTY FOODS 422,884 7.3 1.9 0.0 3.8 -1.9 CM PR PRODUCE 161,173 -14.4 0.7 -0.2 -12.6 -2.1

30

Dollar Sales Change (in millions) Dollar % Change

-$2.86

-$0.41

-$0.36

-$0.35

-$0.35

-$0.28

-$0.27

-$0.15

-$0.14

WB-VILSECK, GERMANY(E41) D

ME-VICENZA, ITALY (E5Q)C

UK-BITBURG AB,GERMANY (E2E) D

ME-INCIRLIK, TURKEY(E5Y) D

RA-SEMBACH AB,GERMANY (E2Z) B

UK-RAF MILDENHALL,ENGLAND (E1J) A

WB-WIESBADEN,GERMANY (E24) D

WB-ANSBACH, GERMANY(E4C) C

UK-RAF CROUGHTON,ENGLAND (E1M) B

-24.9

-5.3

-4.2

-7.2

-16.4

-12.7

-1.8

-2.3

-5.4

Vilseck’s losses may be due to new store opening at Grafenwoehr


Store Performance Fastest Declining Stores (Excluding Closures)

31

• Vilseck - Some of their customers returned to shopping at Graf. Also the impending deployment of 4,000 in Sept, 2007 affected their sales.

• Vicenza - Sales have just leveled off from 06. 75% of the troops were deployed in 2007. The impending deployment of troops from Germany to Italy will affect future sales.

• Bitburg - The 52nd Airwing is on continuous deployment. In Jan. 2008, 1,500 troops were deployed. Active duty has dropped by 200 at this base.

• Incirlik - Major reconstruction of housing is taking place. This has delayed incoming families to this area.

• Mildenhall - Reduced store hours and days.• Wiesbaden - Troops are on continuous deployment.• Ansbach - Several troops deployed, many family

members went back to the US. New troops are expected this fall.

• Croughton - Less troops stationed in this area.

Store PerformanceDeclining Stores

32

Let’s dive down deeper into the data!

33

43.8

42.4

37.9

28.8

28.4

27.4

23.0

16.6

14.9

13.0

10.3

10.3

7.4

6.5

6.2

4.6

1.5

FROZEN FOODS

REFRIGERATED FOODS

SHELF STABLE BEVERAGES

CANNED & BOTTLED GROCERIES

DRY GROCERIES

HEALTH & BEAUTY PRODUCTS

SNACK FOODS

PAPER & PLASTIC

BABY PRODUCTS

HOUSEHOLD CLEANERS

FRESH BAKERY

HOUSEHOLD SUPPLIES

CONFECTIONERY

PET FOODS

SPECIALTY FOODS

TOBACCO

PRODUCE

Top Commodities in Europe

Dollar Volume (millions)

Commodity RankingEurope Overview


34

$ Shr Index

To ConUS

Baby Products are twice as developed in Europe than in ConUS Tobacco indexes only 47 compared to ConUS

Commodity PerformanceEurope Overview


$ % Chg

FROZEN FOODS 0.3 5.1 127REFRIGERATED FOODS 6.1 14.2 79SHELF STABLE BEVERAGES 0.0 5.1 110CANNED & BOTTLED GROCERIES -0.6 3.2 92DRY GROCERIES 0.7 5.3 100HEALTH & BEAUTY PRODUCTS -1.1 0.4 100SNACK FOODS 0.7 5.1 103PAPER & PLASTIC -1.6 2.4 96BABY PRODUCTS 3.5 0.2 209HOUSEHOLD CLEANERS -1.3 0.2 93FRESH BAKERY -3.0 6.9 97HOUSEHOLD SUPPLIES -0.6 1.3 128CONFECTIONERY 6.6 5.6 128PET FOODS 5.8 3.5 69SPECIALTY FOODS 3.8 5.2 119TOBACCO 0.8 -12.2 47PRODUCE -25.0 10.9 36

Europe ConUS

35

TIMES: 52 WK CURR END JUN 07 08

SHARE INDEX

TO CONUS $ VOLUME $ % CHG $ SHR $ VOLUME $ % CHG $ SHR

CM FF FROZEN FOODS 127 43,802,444 0.3 13.6 420,882,528 5.1 10.7FROZEN FISH/ SHRIMP/ SEAFOOD 205 6,121,184 -1.0 1.9 36,452,780 4.0 0.9FROZEN ENTREES 81 4,256,653 8.7 1.3 62,977,524 10.4 1.6FROZEN RAW CHICKEN 186 4,215,473 -3.1 1.3 26,083,942 3.8 0.7FROZEN PIZZA 150 3,956,839 0.0 1.2 33,390,936 2.9 0.8FROZEN PREPARED CHICKEN 167 3,180,667 -1.9 1.0 25,004,426 8.5 0.6FROZEN FAST FOOD/ SNACKS 129 2,760,649 -3.8 0.9 25,738,050 5.0 0.7FROZEN VEGETABLES 88 2,405,185 3.0 0.7 32,365,246 9.0 0.8FROZEN MEAT 117 2,165,284 0.7 0.7 22,903,522 0.2 0.6FROZEN MEXICAN/ ORIENTAL FOOD 150 1,962,656 3.2 0.6 13,914,075 5.2 0.4FROZEN BREAKFAST 120 1,790,351 6.2 0.6 21,256,218 6.8 0.5FROZEN NOVELTIES 100 1,560,522 -3.8 0.5 18,520,716 3.4 0.5FROZEN BAKERY 133 1,307,670 -3.0 0.4 12,855,333 2.9 0.3FROZEN DINNERS II 100 1,131,321 0.4 0.4 16,242,063 7.3 0.4FROZEN POTATOES 100 1,033,822 7.2 0.3 12,083,370 8.4 0.3FROZEN FRUIT 200 659,090 16.6 0.2 5,858,914 12.9 0.1FROZEN PIES 200 544,686 -8.4 0.2 4,967,597 -7.3 0.1FROZEN JUICE/ DRINKS 100 533,327 -1.2 0.2 8,462,001 2.5 0.2FROZEN VEGGIE FOODS 200 529,100 7.0 0.2 4,268,557 6.5 0.1FROZEN TOPPINGS/ CREAMER 100 256,348 -1.6 0.1 2,968,507 -2.0 0.1FROZEN PASTA 230 189,527 0.6 0.1 1,711,053 -0.1 0.0FROZEN POT PIES II 100 182,095 -2.3 0.1 3,385,052 -8.0 0.1

EUROPE CONUS (INC AK/HI)

Commodity PerformanceFrozen Foods


Frozen Fish, Entrees, and Chicken categories drive the Frozen Commodity’s strength in Europe

36

Baby Products account for 4.6% of dollar sales in Europe, significantly

more than its contribution in ConUS (2.2%) and growing

Commodity PerformanceBaby Products Commodity


TIMES: 52 WK CURR END JUN 07 08

SHARE INDEX

TO CONUS $ VOLUME $ % CHG $ SHR $ VOLUME $ % CHG $ SHR

CM BB BABY PRODUCTS 209 14,914,394 3.5 4.62 85,385,048 0.2 2.17BB DIAPERS/ TRAINING PANTS 266 6,120,675 5.8 1.89 27,800,638 -2.2 0.71BB INFANT & TODDLER NUTRITIONALS 217 4,906,056 -0.0 1.52 27,744,738 -0.1 0.70BB BABY NEEDS/ SUPPLIES 190 2,450,361 5.0 0.76 15,568,428 0.4 0.40BB BABY FOOD 122 1,437,303 3.5 0.44 14,271,247 5.5 0.36

EUROPE CONUS (INC AK/HI)

37

Demographic differences in Europe drive category shares in Gourmet and Baby related categories

Dollars

$ Shr

Category PerformanceHighest Category Contribution Indices


1,660,772

0.51%

1,268,993

0.39%

6,120,675

1.89%

1,135,639

0.35%

4,906,056

1.52%

6,121,184

1.89%

2,450,361

0.76%

4,215,473

1.30%

637,0310.20

%

529,1000.16

%

Category Contribution Index

334

295

269

268

213

205

202

196

195

185

MISC GOURMET

MAGAZINES

DIAPERS/TRAINING PANTS

OUTDOOR COOKINGSUPPLIES

INFANT & TODDLERNUTRITIONALS

FROZENFISH/SHRIMP/SEAFOOD

BABY NEEDS/SUPPLIES

FROZEN RAW CHICKEN

BROOMS/MOPS/CLEANINGSUPPLIES

FROZEN VEGGIE FOODS

38

Top three categories are Beverages followed by Salty Snacks

Category PerformanceTop 15 Categories by Dollars


SHR INDEX

TOP 15 CATEGORIES $ RANK $ VOLUME$ % CHG YAGO $ RANK $ VOLUME

$ % CHG YAGO

EUROPE VS CONUS

TOTAL ALL CATEGORIES 323,049,554 0.8 3,938,738,432 4.8CARBONATED BEVERAGES 1 11,546,925 -6.0 2 104,446,288 -2.4 135WATER/ NEW AGE BEV 2 8,756,101 3.3 8 87,305,008 7.6 122CANNED/ BOTTLED JUICE/ DRINKS 3 8,736,028 2.3 7 90,766,264 10.4 117SALTY SNACKS 4 7,775,463 -0.6 9 82,164,400 5.7 115RTE CEREAL 5 7,677,032 1.3 6 93,221,016 2.8 100CONFECTIONERY II 6 7,402,380 6.6 11 72,023,008 5.7 125NON BRANDED MILK/ CREAM 7 7,113,075 1.5 3 103,900,488 27.7 83BISCUITS 8 6,749,395 0.0 5 93,584,680 4.9 88NATURAL CHEESE 9 6,745,635 10.8 10 79,401,208 18.2 104BREAD 10 6,698,883 -3.3 4 95,886,624 8.2 85FROZEN FISH/ SHRIMP/ SEAFOOD 11 6,121,184 -1.0 26 36,452,780 4.0 205DIAPERS/ TRAINING PANTS 12 6,120,675 5.8 41 27,800,638 -2.2 268INFANT & TODDLER NUTRITIONALS 13 4,906,056 0.0 42 27,744,738 -0.1 216BATH TISSUE 14 4,761,752 4.7 12 66,203,040 6.1 88HEAVY DUTY LAUNDRY DETERGENT 15 4,575,690 0.6 15 60,809,524 2.8 92

EUROPE CONUS

39

Six of the top ten growth categories are in the Chilled Section

Category PerformanceFastest Growing Categories by $


Categories with >$500k Sales in Europe $ % Chg $ Volume

$ Rank (Europe)

Pkg % Chg

UPC Count %

Chg

BUTTER 29.9 873,518 106 15.3 24.7MISC GOURMET 26.9 1,660,772 64 29.8 -8.9BRANDED MILK & CREAM 24.7 4,044,585 20 12.5 12.6YOGURT 21.8 1,152,005 91 13.5 45.3FROZEN FRUIT 16.6 659,090 123 16.3 14.4CAT FOOD/ WET 16.2 711,067 119 -15.6 -7.9CHILLED MEAT/ FISH/ SEAFOOD 15.6 1,077,857 95 11.6 -2.2PASTA 14.8 1,275,867 84 1.6 2.1CHILLED JUICE/ DRINKS 14.6 2,391,479 41 2 21.1NATURAL CHEESE 10.8 6,745,635 9 -3.8 -0.9

40

Category Contribution Index

Many different factors contribute to low indices for these categories (e.g., yogurt - shelf life issues, coffee – local offerings)

34

41

46

52

55

56

59

61

64

65

FRESH VEGETABLES

YOGURT

CIGARETTES

GASTRO INTESTINALREMEDIES

CHILLEDMEAT/ FISH/ SEAFOOD

TOTAL COFFEE

CAT FOOD/ WET

DOG/ CAT SNACKS

DRIED FRUIT

LUNCH COMBINATIONS

Dollars

$ Shr

Category PerformanceLowest Category Contribution Indices


1,205,866

0.37%

1,152,005

0.36%

4,271,825

1.32%

783,4780.24

%

1,077,857

0.33%

2,870,730

0.89%

711,0670.22

%

975,6600.30

%

768,0770.24

%

805,6670.25

%

41

Fresh Vegetables* and Brooms/Mops/Cleaning Supplies were

the fastest declining categories both in dollars and packages

Category PerformanceFastest Declining Categories by $

* Produce sales were affected by discontinuation of a contract with Fresh Express during spring and summer last year


Categories with >$500k in Europe $ % Chg $ Volume $ RankPkg % Chg

UPC Count %

Chg

FRESH VEGETABLES -31.9 1,205,866 87 -26.1 -56.9BROOMS/ MOPS/ CLEANING SUPPLIES -19.8 637,031 126 -25.3 -1.2PREMOIST TOWELETTES -11.7 1,771,911 59 -7.5 0.6FROZEN PIES -8.4 544,686 132 -5.8 10.7MAGAZINES -8.2 1,268,993 85 -14.2 -5.3TOTAL SWEETENERS -7.6 1,409,808 73 -3.6 -4.1FIRST AID PRODUCTS -7.5 707,967 120 -4.4 -8.6CHILLED DOUGH -6.3 1,607,233 65 -5.5 -7.1UNPOPPED POPCORN -6.2 885,246 104 -9.1 -6.5REFUSE BAGS -6.0 1,313,415 81 -7.5 -6.9

42

A quick look at Sales Bands, Store Class,

and Case Lot Sales

43

Class A Stores3%

Class B Stores16%

Class C Stores18%

Class D Stores63%

-4.2

15.9

-2.5

-1.3

Class A

Class B

Class C

Class D

% of Total Dollars

$ % Change vs Year Ago

Overall three new stores were added to Class B and two Class B stores were closed in 2007*

Store Performance Europe by Store Class


11

10

8

15

# of Stores by Class

* Lajes Field, Livoron, and Illesheim - Class was changed to B; Class B stores Bad Nauheim and Giessen were closed in 2007

44

20.9 20.5

16.5

10.08.2 8.0

7.05.7

2.9

0

5

10

15

20

25

SALE

SBAN

D5

SALE

SBAN

D4

SALE

SBAN

D3

SALE

SBAN

D9

SALE

SBAN

D8

SALE

SBAN

D2

SALE

SBAN

D7

SALE

SBAN

D6

SALE

SBAN

D1

6.7

10.8

3.3

4.7

3.0

-24.1

6.1

2.5

-11.1

SALESBAND 5

SALESBAND 4

SALESBAND 3

SALESBAND 9

SALESBAND 8

SALESBAND 2

SALESBAND 7

SALESBAND 6

SALESBAND 1

% of Total Dollars $ % Change vs Year Ago

Sales Bands 5 & 4 are the largest in dollar volume and had the highest growth

Store Performance Europe by Sales Bands


45

May Case Lot Performance Europe Case Lot Sales by Zone

Source: Stephen J. Armbruster, Chief, Marketing Branch (DeCA/EU/DOM)

U.K. ZONE13,69317%

BAMBERG ZONE

11,82615%

MED ZONE27,04135%

RAMSTEIN ZONE

26,33733%

78,897 Cases Sold

• Ramstein led the way in case lot sales, selling 8,300 cases (32% of Ramstein Zone sales); Vogelweh followed closely behind.

• Napels, Incirlik, Bamberg, and Cairo sold 100% of the cases ordered.

46

Case Lot Performance Europe Case Lot Sales by Zone

Bitburg Case Lot

Hohenfels Case Lot

Cairo Case Lot

47

DeCA Europe

• DeCA has sustained 5.3% dollar growth for the past five years!

• Their average dollar sale has increased dramatically, up 4% (Oct-May 2008)

• The top six stores account for 40% of Europe’s sales volume

• New troops and families are continuing to arrive to Europe

• The largest group of troops are young, active duty with growing families

• Many categories index much higher in Europe vs. ConUS– Baby Products, Frozen Foods, Confectionery,

Household Supplies• Europe sold 80,000 cases in its May Case Lot Sale

Key Facts to Take Away

48

DeCA Europe

DeCA’s dollar sales goal for FY 2008 is $6 billion…

So what can you do to assist DeCA achieve this goal?

49

DeCA Europe Opportunities

• 58% of the active duty troops stationed in Europe are 25-44 years of age

• Most of them have two or more children • This is a key time to formulate brand loyalty and

establish shopping patterns that will be lifelong• Most shop exclusively on base for their food and other

related items• Bringing a taste of home means so much to them

Important Market

50

So when you start putting together your marketing budget,

please don’t forget this group!

Support the troops when they need it most!

1 presented by empower it august 2008 european market overview heidelberg, germany

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