BONNIE A. KANITZ DIRECTOR, DeCA EAST July 11, 2007 DeCA EAST SALES UPDATE

FY06 Sales ACV % Sales % Change Transactions Average Sale % DeCA100%5.417B0.9%-2.1%3.0% East46.6%$2.526B 1.9% 1.9%-1.2%2.9% Europe 8.7% 8.7% $.470B -3.8%-5.0%1.3% West44.7%$2.420B 1.0% 1.0%-2.1%3.2% DeCA East achieves over $2.5B in sales for 2006!!

FYTD 07 (October 06 – May 07) SALES LocationSales % Change Transactions % Chg Average Sale % DeCA$3.676B 1.8% 1.8%-1.0%+2.9% DeCA East $1.725B 2.9% 2.9%-0.1%+2.9% Zone 21 $75.2M-1.2%-4.9%+3.9% Zone 23 $77.5M 0.4% 0.4%-1.2%+1.6% Zone 24 $198.0M 3.7% 3.7%+0.2%+3.4% Zone 25 $164.2M 1.3% 1.3%-1.4%+2.7%

MAY 2007 RESULTS REGIONCASESDOLLARS % EAST 1,042,826$ 7,084, EUROPE 61,046$ 775, WEST 721,793$ 4,632, GRAND TOTAL1,825,665$12,491, All time record for May Worldwide Caselot Sales All time record for May Worldwide Caselot Sales 1.6% increase over the Worldwide Caselot Sale in May % increase over the Worldwide Caselot Sale in May 2006

Fort Drum  10 th Mountain Division has 4 brigades. Three are stationed at Fort Drum; one is stationed at Fort Polk.  A brigade from Fort Drum returned from extended deployment in June from Afghanistan.  Another brigade from Fort Drum, (originally scheduled to return home in June), was extended until late September.  The brigade returning in September from an extended tour in Iraq will be replaced by a brigade at Fort Drum.  Next Spring, another Fort Drum brigade will return to Afghanistan. This will leave only one brigade at Fort Drum.

FORT DETRICK  NEW CONSTRUCTION  $13.5M  34,210 SQUARE FEET  CONSTRUCTION START DATE: SEP 06  PROJECTED COMPLETION DATE: JAN 08

FORT DRUM  ADD/ALT PROJECT  $19.2M  82,800 SQUARE FEET  PROJECT START DATE: JUL 07  COMPLETION DATE: MAR 09  MAJOR ELEMENTS: o SMALL ENTRANCE ADDITION o COMPLETE RENOVATION TO CURRENT DeCA STANDARDS AND LAYOUT

SARATOGA SPRINGS  NEW CONSTRUCTION (REPLACES SCOTIA)  $7.1M  22,400 SQUARE FEET  START DATE: DEC 07  PROJECTED COMPLETION DATE: NOV 08

TOBYHANNA  ARCHITECTURAL & REFRIGERATION UPGRADE  $3.6M  START DATE: SEP 06  PROJECTED COMPLETION DATE: OCT 07  MAJOR ELEMENTS: o SALES AREA UPGRADE o REPLACE REFRIGERATION EQUIPMENT & DISPLAY CASES o UPGRADE MEAT MARKET o MISC. REPAIRS

Impact of closing locations: (BRAC 2005) Commissaries affected: 6 Stores Fort Monmouth, NJ Fort McPherson, GA Fort Gillem, GA CE Kelly Support Center, PA NSCS Athens, GA NAS Brunswick, ME FY 2006 Sales: $65.5M FY 2006 Surcharge: $3.3M Depreciated value of assets: $9.1M Employee authorizations: 195

Brunswick  FYTD 07 Sales (May 31) +2.4 $176,058  FY 09 there will be a 50% draw down in active duty members due to Squadron deployments that are not returning to Brunswick.  Attitude is everything! Brunswick has become one of the best “Team Stores” in the zone. All managers and staff approach their jobs as if they are getting a new store in 4 months and will all receive grade increases versus actually closing in 3 years due to BRAC.

C. E. Kelly C. E. Kelly  FYTD 07 Sales (May 31) – 6.2% ($322,734)  Extensive BRAC media coverage.  All installation activities, i.e. PX, Gym, have reduced operating hours. This limits the amount of traffic to the Post and Commissary.

Fort Monmouth Fort Monmouth  FYTD 07 Sales (May 31) –.13% ($10,724)  Curtailment of operational hours at some facilities located on base  Tours by interested parties regarding purchase of the Fort Monmouth property continue  Customer base is primarily retired, senior citizens citizens

#1 Aggressive merchandising program #1 Aggressive merchandising program Focus on perimeter departments - - quality, availability, service, & maximum savings Focus on perimeter departments - - quality, availability, service, & maximum savings  Set expectations - perimeter always comes first  Meat – cut all that you can cut, major push to eliminate case ready on principle cuts - - maximizes customers savings  Meat Truckload / Seafood Road Shows - - aggressively stomped unauthorized installation competition

 Focus on perimeter departments (cont)  Produce – emphasis on merchandising and quality  Deli/Bakery – focusing on improving as it is a “real” department  Aggressive indexing of categories & MBU program compliance  Case lot/truck load sales/side walk sales – continuous special outreach events  Club pack program endorsed and promoted Summer and Winter 06

#2 Focus on leadership with four “E’s & P” #2 Focus on leadership with four “E’s & P” in every store in every store  E nergy  E nergize those around you  E dge (able to make those tough decisions)  E xecute & P assion  Building strong teams to execute Agency vision and programs

#3 Focus on weekend vendor stocker support #3 Focus on weekend vendor stocker support Do you really know what your support is on the weekend? support is on the weekend?

One Store, One 300K Super Bowl Saturday Sales Opportunity Friday, Saturday, Sunday = 60-65% Sales Friday, Saturday, Sunday = 60-65% Sales Friday = Vendor Admin Day Friday = Vendor Admin Day Saturday/Sunday – poorest days for Vendor Stocking Saturday/Sunday – poorest days for Vendor Stocking Who’s watching the Hen House? Who’s watching the Hen House? Days Results 285K in sales = missed target goal!

RankDateNet SalesEvent 11/31/2004$26,032,612Super Bowl 22/3/2007$26,029,117Super Bowl 311/18/2006$25,255,742Thanksgiving 42/2/2002$24,835,463Super Bowl 511/19/2005$23,802,452Thanksgiving 611/17/2001$23,765,390Thanksgiving 72/4/2006$23,571,575Super Bowl 83/3/2001$23,308,730Pay Day 97/1/2005**$23,169,867July 4th 1012/30/2005**$23,125,009New Year's Eve 119/2/2006$23,100,835Labor Day 1212/2/2006$22,896,133Pay Day 1311/20/2004$22,860,682Thanksgiving 149/30/2006$22,638,613Pay Day 152/3/2001$22,616,317Pay Day ** Friday, All other dates Saturday

DeCA Missed Top Sales Record Day by $3K on Feb 3 rd !

1) Program Weekend Checks on Service Levels 2) Fix Vendor Stocking Support on Weekends a) Separate Team for Fri, Sat & Sunday? b) Pay Hourly – NOT BY ROLL-UP!

DeCA WILL PAY OVER $104,000 TO CONTRACTORS TO STOCK VENDOR CATEGORIES FROM JUST TWO STORES ! Fort Meade (Class 5) Fort Meade (Class 5) 43,208 cases and $25,064 paid to the contractor FYTD 07 43,208 cases and $25,064 paid to the contractor FYTD 07 Average cases 5,401/month Average cases 5,401/month Average cost $3,133/month (equates to $37,596 annually!) Average cost $3,133/month (equates to $37,596 annually!) Hanscom (Class 3) Hanscom (Class 3)  Estimated Frozen Food Cases Stocked & Cost Per Month 7,296 cases and $5,584 paid to the contractor 7,296 cases and $5,584 paid to the contractor Equates to over $67,000 annually Equates to over $67,000 annually

A weekend vendor stocking test program was initiated by Kraft Foods Military effective March 30, 2007 in 43 DeCA East stores. A weekend vendor stocking test program was initiated by Kraft Foods Military effective March 30, 2007 in 43 DeCA East stores. Additional stocking support is being provided to selected CONUS stores for enhanced weekend coverage. Additional stocking support is being provided to selected CONUS stores for enhanced weekend coverage. Labor supplement covers mid-morning to late afternoon in test stores, maximizing sales opportunities for all operating hours. Labor supplement covers mid-morning to late afternoon in test stores, maximizing sales opportunities for all operating hours. Incremental shelf replenishment orders are considered to capture missed consumption, and matched with the level of incremental support provided on a store by store basis. Incremental shelf replenishment orders are considered to capture missed consumption, and matched with the level of incremental support provided on a store by store basis. Results are favorable and have proven in most instances to capture sales that were previously lost due to NIS conditions. Results are favorable and have proven in most instances to capture sales that were previously lost due to NIS conditions.

Kraft, Nestle, Webco, and Sarvis now on board in select stores with payday weekend support! Other brokers and manufacturers are expressing interest and making inquiries regarding participation. SARVIS A “WIN-WIN” PROPOSITION!

Kraft Vendor Stocking Enhancement Test FRIDAY-MONDAY TOTALS YTD TRENDS PARTICIPATING STORES: (ZONES 21, 23, 24 & 25): TYChg % Chg YTD CHG YTD CHANGE FORT BELVOIR $84,196$10, %3.6%$88,186 FORT MEADE $65,120$9, %4.4%$80,819 MCGUIRE AFB $48,617$6, %-0.5%-$6,213 QUANTICO MCB$66,102$7, %5.2%$91,701 DOVER AFB$19,757$1,7039.4%1.9%$13,323 FORT DRUM$27,100$6, %3.4%$25,369 FORT MYER$49,782$4, %5.1%$72,175 HANSCOM AFB$21,678$1,8929.6%-3.9%-$28,112 BRUNSWICK NAS$16,749$2, %1.6%$6,989 FORT MONMOUTH$10,362$1, %-1.7%-$6,074 NEWPORT NETC $17,095$1,4199.1%6.6%$35,352 PATUXENT RIVER NAS $21,212$1,8289.4%1.5%$10,094 BANGOR ANGB $7,041$1, %4.3%$9,752 C.E. KELLY $6,669-$ %-3.9%-$11,069

“Pictures say 1,000 words!” DeCA East POC for Vendor Stocking Issues (Joyce Chandler - CMS)

#4 Continued emphasis/training on CAO #4 Continued emphasis/training on CAO processes to optimize shelf pack-out processes to optimize shelf pack-out If you stock it, we will order it!! If you stock it, we will order it!!

 Tactical Changes To Increase Sales  Addressing leadership issues – Building Strong Teams!  Focus on perimeter sales  Focus on MBU programs & special sales events (“WOW!”)  Push club pack sales  Continued CAO training to ensure maximum shelf stock  Improve Weekend Support & Coverage  Ensuring that outreach program is at its maximum potential  Improve merchandising of the sales floor  Continuous indexing of commodities

“Telling the future by looking at the past assumes that conditions remain constant. “This is like driving a car by looking in the rear view mirror” - Herb Brody