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Objectives and Growth Opportunities of the HORNBACH Group

We aim to continually expand HORNBACH’s position in the European do-it-yourself (DIY) market by means of organic growth. Our sales and profitability are to be sustainably increased by expanding our internationally successful retail format. This involves focusing on the strategic enhancement of our concept and expanding our store network at locations offering above-average growth potential in Germany and abroad.

Our sustainable growth strategy focuses at all times on the project concept. This results in pricing, product range and service policies that benefit our customers. The foundation for generating this added value is provided by our homogenous store network of DIY megastores with garden centers, our crosschannel strategy, our efficient logistics and IT processes, and our focus on organic international growth. By differentiating itself this way, HORNBACH has been able to outperform its sector.

HORNBACH’s absolute focus is on project customers. On the one hand, these are home improvement enthusiasts and professional customers wishing to implement extensive renovation and construction projects under their own steam in their houses, apartments or gardens (do-it-yourself). On the other hand, they also include customers wishing to select their products themselves, but then have all of the work involved in the project, including all services, performed by a competent partner (do-it-for-me). All of the company’s activities are tailored to these target groups.

HORNBACH thus offers its customers a reliably permanent low price policy. We are convinced that we are better able to retain customers at HORNBACH in the long term by offering and guaranteeing the best market price on a permanent basis. In particular, our main target group of project customers, who often undertake large-scale renovation work, needs to be able to budget in the long term. This is not possible with temporary discount campaigns.

Our customers benefit from a broad and deep product range stocked in sufficiently large quantities and meeting high quality standards. The average product range stocked by HORNBACH stores encompasses around 50,000 articles in the five following divisions: Hardware/Electrical, Paint/Wallpaper/Flooring, Construction Materials/Timber/Prefabricated Components, Sanitary/Tiles, and Garden. Numerous additional articles are available for ordering.

Furthermore, we also offer project-related services. These include home improvement demonstrations at stores that are intended to motivate customers to do it themselves, and special project evenings for women. These measures are backed up by the promotion of specialist skills on the part of store personnel aimed at achieving a further increase in product expertise and advisory competence, and thus in customer satisfaction. Our DIY megastores with garden centers are also increasingly of interest to professional customers. Generous opening hours, the stocking of large quantities, the rapid handling of purchases at our drive-in stores and builders’ merchant centers, and the uncomplicated acceptance of residual volumes no longer required make HORNBACH an attractive alternative to traditional specialist retail or wholesale procurement sources.

Implementing this concept to the benefit of our customers requires a high-performing infrastructure.

HORNBACH has decades of experience in operating DIY megastores with garden centers in major regional catchment areas. Its portfolio of locations in Germany and abroad is highly homogenous. Most of the Group's stores have sales areas in excess of 10,000 m². This enables HORNBACH to benefit from economies of scale in its operations and conceptual store enhancement measures, as well as in its group logistics. We rely not only on our stationary retail business, but are dovetailing this with an ever more extensive HORNBACH online store in Germany and abroad. The guiding principle – HORNBACH should offer customers all the channels they need to implement their projects.

HORNBACH is committed to organic growth. We will continue to track down opportunities in our expansion across Europe in future as well. In the densely occupied German DIY market, we are relying on selective growth in attractive catchment areas. Here, we can draw on our structural advantages and benefits of scale, especially our high surface productivity together with the largest average store size in the market. In our expansion, we are focusing on countries outside Germany. Due to their lower degree of market saturation in the DIY megastore and garden center segment, most other European regions harbor above-average growth opportunities compared with Germany.

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HORNBACH Holding
Half-Year Financial Report 2017/2018 as of August 31, 2017
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Half-Year Financial Report 2017/2018 as of August 31, 2017

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