1

ANALYST MEETING

MIKKO HELANDERJUKKA ERLUND

22.9.2016

2

MARKETS AND FINANCIAL

DEVELOPMENT

-4,0

-2,0

0,0

2,0

4,0

6,0

8,0

10,0

12,0

Estonia

Lithuania

Sweden

Norway

Latvia

Finland

RETAIL TRADE TRENDS IN OPERATING COUNTRIESROLLING 3 MO

3

Source: Eurostat, excl. motor vehicles and fuels

% (r

ollin

g3

mo)

KEY FIGURES, ROLLING 12 MO

4

Net sales, €m 9 024 8 881 8 780 8 679 8 610 8 993

Change in net sales, % * +0,7 -2,2 +1,2 +0,9 +0,2 +4,6

Gross margin, % 13,6 13,5 13,3 13,1 13,1 13,5

Operating profit**, €m 240,0 248,8 247,2 244,5 250,2 253,0

Earnings per share, comparable, €, basic * 1,69 1,72 1,66 1,70 1,78 1,85

Interest-bearing net debt, €m +41 -359 -394 -448 -311 +330

ROCE, % ** 10,2 10,9 11,3 11,7 12,4 12,6

Capita expenditure, €m 202 205 195 219 218 672* In local currencies, excl. Acquisitions and divestments ** comparable

Q1/15 Q2/15 Q3/15 Q4/15 Q1/16 Q2/16

RETURN ON CAPITAL EMPLOYEDCOMPARABLE, ROLLING 12 MO

5

14.0 13.1

9.0 9.8 9.911.7 12.6

0

4

8

12

16

2010 2011 2012 2013 2014 2015 Q2 2016

%Target14%

RETURN ON CAPITAL EMPLOYED BY DIVISIONCOMPARABLE, ROLLING 12 MO

6

Group totalBuilding and technical trade

Grocery trade Car trade

%

22.2

10.1

22.5

12.6

0

5

10

15

20

25

30

KESKO GROUP'S SALES IN EUROS, EXCLUDING VAT, IN JANUARY-AUGUST 2016

7

1.1. - 31.8.2016 Comparable€ million Change, % change, %

Grocery trade, total 3,396.4 +10.3 +0.2Building and technical trade, Finland

1,379.1 +12.5 +0.7 Building and technical trade, other countries 1,241.0 +16.8 +5.9 Building and technical trade, total

2,620.0 +14.5 +3.2Car trade, total 570.4 +7.8 +7.8Common functions and eliminations -4.7Grand total 6,582.2 +11.6 +1.8

Finland, total 5,268.3 +10.4 +1.0 Other countries, total 1,313.9 +16.3 +7.2 Grand total 6,582.2 +11.6 +1.8

8

GROCERY TRADE

KESKO GROCERY TRADE

9

Net sales €4,867m

Operating profit* €174m

Operating margin* 3.6%

ROCE* 22.2%K-Group 32.7%S-Group 45.9%Lidl 8.3%Suomen Lähikauppa 6.4%Others 6.7%

Total market €16.6 billion in 2015

Source: Nielsen

* comparable

Q3/2015-Q2/2016

CONSUMER PRICE INDEX – FOOD AND NON-ALCOHOLIC BEVERAGESANNUAL CHANGE, %

-4

-2

0

2

4

6

8

10

Source: Statistics Finland

11

GROCERY TRADE STRATEGY PROGRESSING AS PLANNED

• Renewal of neighbourhood store network and conversion of Siwa and Valintatalo stores into K-Markets

• Renewal of K-citymarket chain

• 70 renewed Neste K service station stores by 2017

• Best digital services in the tradingsector

CONVERSION OF SIWA AND VALINTATALO STORES INTO K-MARKETS

• K-neighbourhood store selection and Pirkka products introduced

• Prices as much as 20% lower

• Some 100 stores already converted, over 200 by the end of 2016

• Synergy benefits are estimated at approximately €25–30 million at EBITDA level as of 2018• The costs of store and network conversion, to be

treated as non-recurring restructuring cost, will total approximately €30 million in 2016–2018

12

13

BUILDING AND TECHNICAL TRADE

BUILDING AND TECHNICAL TRADE

14

Net sales €3,335m

Operating profit* €82m

Operatingmargin* 2.4%

ROCE* 10.1%

Sports trade€186m

Furniture trade€179m

Agricultural and machinery trade Finland €500m

Others€37m

Building and home improvement trade Belarus €116m

Building and home improvement trade

Russia €192m

Building and homeimprovement tradeFinland €794m

Building and homeimprovement tradeScandinavia €627m

Building and home improvement trade Baltics €461m

Agricultural and machinery trade Baltics €115m

* comparable

2015

Q3/2015-Q2/2016

GRANTED BUILDING PERMITS AND BUILDING STARTS, MIL. M3, MOVING ANNUAL TOTAL

15

Source: Statistics Finland

GOOD PROFIT PERFORMANCE IN THE BUILDINGAND TECHNICAL TRADE DIVISION

• Good sales performance• Strong growth in B2B trade

• Profitability improved especially in the Baltics, Sweden and Norway

• Kesko Senukai’s profitability good• Market still has significant growth

potential

16

0

10

20

30

40

50

60

70

80

90

Comparable rolling 12 mo operating profit

M€

STRENGTHENING OF PROFITABILITY AND GROWTH

17

• Combination of Onninen and Kesko to become the strongest B2B entity in themarket

• Widest selection in the market

• Most comprehensive store network and largest sales organisation of northern Europe

• Most customer oriented logistics and digitalservices for B2B customers

• Realisation of synergies has started• Full synergies at EBITDA level around

€30 million per year as of 2020

GROWTH FROM EUROPE AND B2B SALES

• Growth from both B2C and B2B sales

• Strengthening of market position in Finland

• Accelerating of growth and furtherstrengthening of positions in Scandinavia

• Boosting Kesko Senukai’s growth

18

Current operating country Poland with acquisition of Onninen as of 1 June

19

CAR TRADE

CAR TRADE

20

Net sales €786m

Operating profit* €25m

Operating margin* 3.2%

ROCE* 22.5%

Volkswagen 11.0%

Toyota 10.8%

Skoda 9.7%

Ford 8.1%

Volvo 6.3%

Nissan 6.1%

Kia 6.1%

Audi 5.2%

Seat 2.0%

Others 34.7%* comparable

Q2/2016

Q3/2015-Q2/2016

FIRST REGISTRATIONS OF PASSENGER CARS IN FINLAND

21

Source: Statistics Finland