June 25, 2013
The Company claims the protection of the safe-harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. The Company intends these forward-looking statements to speak only as of the time of the presentation and does not undertake to update or revise them, as more information becomes available. These statements discuss, among other things, expected growth, store development and expansion strategy, business strategies, future revenues and future performance. These forward-looking statements are based on estimates, projections, beliefs and assumptions, including, but not limited to, competition, product demand, economic conditions, inflation, consumer debt levels, governmental approvals, ability to hire and retain qualified employees, weather, etc. Actual results may materially differ from anticipated results described in these forward-looking statements. Please refer to the Risk Factors section of the Company’s Form 10-K for more details.
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Largest specialty retailer of farm & ranch stores Service the lifestyle needs of recreational farmers &
ranchers, rural tradesmen and small businesses Customers are home, land, pet & animal owners with
above average income and below average cost of living Stores are located in towns outlying major
metropolitan markets and rural communities 1,197 stores in 45 states Sales and EBITDA of $4.7b and $526m in 2012
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• Unique niche growth company
• New strategic initiatives to drive: - comparable store sales
- operating profit
- return on capital
• Significant growth opportunities
• Clearly defined capital allocation strategy
• Focus on shareholder value and returns
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Comprehensive, yet tailored, assortment…
Livestock & Pet
Hardware, Tools & Truck
Seasonal, Gift & Toys
Clothing & Footwear
Agricultural Products
42%
23%
20%
9% 6%
Percent of Sales - 2012
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• Be the most dependable supplier of basic maintenance needs
• Differentiate through products and brands • Offer value that exceeds customer expectation • Excite customers with treasure hunt experience • Maintain commitment to supporting the ‘Out Here’ customer
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Livestock & Pet
Seasonal, Gifts & Toy Products
Hardware, Tools & Truck
Clothing & Footwear
Agriculture
855 930 1,001 1,085 1,176
0
500
1,000
1,500
'08 '09 '10 '11 '12
Stores
3.01 3.21 3.64 4.23 4.66
$0
$2
$4
$6
'08 '09 '10 '11 '12
Sales (in $ billions)
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239 258 336
433 526
$0
$200
$400
$600
'08 '09 '10 '11 '12
EBITDA (in $000’s)
1.44 1.63 2.25
3.01 3.80
$0$1$2$3$4
'08 '09 '10 '11 '12
E.P.S.
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Price Optimization
Exclusive Brands
Strategic Sourcing
Inventory Management
Gross Margin Expense Management
TVS
Property Ownership
Purchasing
Energy Management
Comparable Sales
New Products
C.U.E.
Regionalization
Drive Aisle
Balanced focus on sales and margin Will not risk “market share” for “margin rate” Will continue to…
take calculated risks “test and learn” utilize, learn and improve from “C.O.E.” process
Excited about pipeline of opportunities
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New Products C.U.E.
Drive Aisle Merchandising Regionalization
Sales
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• Pipeline of opportunities • Structured test program • Culture of risk-taking • Open buying days • Category resets
New Products
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• Be the most dependable supplier
• Grow market share • Improve in-stock levels • Continue to improve
price management • Expand assortments
C.U.E.
15
16
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• Relevant assortments • Brand preferences • Customer feedback • Town Hall meetings • A – D assortments
Regionalization
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Geographic Assortment Local Store Assortment
Regional Brand Preference
• Increase basket • Utilize event merchandising • Enhance Treasure Hunt
experience • Learn from customer • Improve impulse item offers
Drive Aisle Merchandising
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21
Wild Game Supplies Chick Days Event
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Price Optimization
Exclusive Brands
Inventory Management
Strategic Sourcing
Gross Margin
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• Does not mean price increase • Utilize “test and learn”
approach • Will not risk market share • Focused on Regular Price • Add Promotion and
Clearance modules later
Price Optimization
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• ~ 25% of sales • Brand development
approach • Provide value to customers • Opportunity for growth • 4health – expanding
offering
Exclusive Brands
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Livestock & Pet
Seasonal, Gifts & Toy Products
Hardware, Tools & Truck
Clothing & Footwear
Agriculture
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4health Expansion C.E. Schmidt
Leather Footwear
• Determining factors… • Product quality • Sufficient supply chain
& vendor stability • Price / landed cost
• Multiple sources preferred
Strategic Sourcing
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• Allocate more productively • Regionalize the assortments • Continue to adapt & react to
trends • Seize opportunities • End seasons clean
Inventory Mgmt.
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2.79 2.88
3.09
3.23 3.28
2.5
2.6
2.7
2.8
2.9
3
3.1
3.2
3.3
3.4
'08 '09 '10 '11 '12
Inventory Turns Defined test programs Disciplined flow of
merchandise Improved ability to adapt
and react to trends Committed to ending
seasons clean Dedicated to meet
customer needs through emergency response
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Grow Stores ~ 8% square footage
Same-Store Sales Growth ~ 3% - 5%
Improve Operating Margin ~20 bps
Invest to Grow Business ~ $250m
Return Cash to Shareholders
Grow EPS in the 14% to 16% range
on an annual basis
6.1%
9.4% 10.5%
2007 2012 2017e
Operating Margin
$1.24
2007 2012 2017e
EPS
$3.80
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$7.20 - $7.70
Investing for Growth ~ $250m annually
Dividend Currently $0.26 per share quarterly 20 to 25% payout ratio 15 to 20% dividend growth
Share Repurchase ~ 40% - 45% of operating cash flow ~ $170m - $290m annually ~ 2% - 3% shares purchased annually
Creating Shareholder Value
Share Repurchase
Dividend
Reinvest in the
Business
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42/307 176/353
480/677
475/763
Tractor Supply Store Count
1Q13 / Opportunity (excludes 24 Del’s stores) Total: 1173 / 2100
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June 25, 2013