Corporate Presentation...
Transcript of Corporate Presentation...
Fourth Quarter
Corporate Presentation
CencosudApril 2016
Corporate Presentation | Contents | 2
• Investment Highlights
• Cencosud Snapshot
• Key Figures
• Strategy
• Corporate Governance
Contents
• Investment Highlights
• Cencosud Snapshot
• Key Figures
• Strategy
• Corporate Governance
Contents
Corporate Presentation | Contents | 3
Investment Highlights
Core in food retailing business, more resilient to economic downturns
Leading retailer in Latin America with the highest geographic diversification in the region
Premier brand portfolio with high consumer recognition
Committed Board of Directors and Seasoned Management Team
Opportunity to continue expanding in markets with high growth and low penetration
Corporate Presentation | Investment Highlights | 4
Corporate Presentation | Contents | 5
• Investment Highlights
• Cencosud Snapshot
• Key Figures
• Strategy
• Corporate Governance
Contents
73,3%
6,4%
20,3%
Retailing Areas Financial Services Real Estate
96,2%
1,5% 2,3%
Retailing Areas Financial Services Real Estate
Source: ILACAD and US Census Bureau, figures as of December 2013
Retail AreasSupermarkets , D-Stores & DYS
USD 11,329 MM
USD 2,069 MM
USD 1,481 MM
Support BusinessesShopping Centers &
Financial Services
1 Translated into USD at CLP/USD 710.162 Financial Services figures exclude Financial Services Chile.3 Revenue and Adjusted EBITDA breakdown graphs exclude segment “Others” 4 Adjusted EBITDA excluding all one-off charges of CLP 789,505 million.5 Shopping Centers figures only reflect revenues and adjusted EBITDA contributed by third party transactions.
Revenues Dec.2015
USD 15,477 MM1
Retail AreasSupermarkets, D-Stores & DYS
Support Businesses Shopping Centers &
Financial Services
Adjusted EBITDA Dec.2015
USD 1,112 MM4
USD 349 MM
USD 233 MM2
Others:
USD 16 MM3
Corporate Presentation | Cencosud Snapshot | 6
Overview by Business
USD 268 MM
76.7% mg
USD 84 MM2
36.0% mg
Others:
USD -209 MM3
USD 680 MM
6.0% mg
USD 202 MM
9.8% mg
USD 87 MM
5.8% mg
Source: ILACAD and US Census Bureau, figures as of December 2013
Atlantic Coast
USD 2,369 MM
USD 4,592 MM
Andean Region
1 Figures for FY 2015, translated into USD at end of period exchange rate (CLP/USD 710.16). 2 Figures from Chile exclude results from the Financial Service division after the completion of the Scotiabank transaction to jointly develop the business in May 1st, 2015.3 Adjusted EBITDA excluding all one-off charges: CLP 105,038
Revenue Dec.2015 USD 15,477 MM1 Adjusted EBITDA Dec.2015 USD 1,112 MM3
USD 1,291 MM
USD 1,401 MM
USD 5,824 MM2
Corporate Presentation | Cencosud Snapshot | 7
Atlantic CoastAndean Region
• 245 Supermarkets
• 35 Home Improvement
• 79 Department Stores
• 25 Shopping Centers
• JV Scotiabank
• 286 Supermarkets
• 50 Home Improvement
• 22 Shopping Centers
• 90 Supermarkets
• 9 Department Stores
• 4 Shopping Centers
USD 48 MM
3.8% mg
USD 108 MM
7.7% mg
USD 538 MM2
9.2% mg
• 222 Supermarkets
• Atacarejo format
• 3 different regions
• JV Bradesco
• 101 Supermarkets
• 10 Home Improvement
• JV with Colpatria
USD 26 MM
1.1% mg
USD 392 MM
8.2% mg
Overview by Country
37,6%
29,7%
15,3%
9,1%
8,3%
Chile Argentina Brazil Peru Colombia
48,3%
35,3%
2,3%
9,7%
4,4%
Chile Argentina Brazil Peru Colombia
Source: ILACAD and US Census Bureau, figures as of December 2013
3rd SUPERMARKET2nd HOME IMPROVEMENT
1st SUPERMARKETS4th DEPARTMENT STORES
2nd SUPERMARKETS2nd HOME IMPROVEMENT2nd SHOPPING CENTERS2nd DEPARTMENT STORES
4th SUPERMARKETSNORTHEAST (#2)
MINAS GERAIS (#1)RIO DE JANEIRO (#3)
2nd SUPERMARKETS1st HOME IMPROVEMENT2nd SHOPPING CENTERS
Strong Brand Portfolio
with High Consumer Recognition
Corporate Presentation | Cencosud Snapshot | 8
High and low end brands
Supermarkets
Home Improvement
Department Stores
Regional Presence / Market Position
HIGH INCOME CONSUMER
MID-TO-LOW INCOME CONSUMER
HIGH INCOME CONSUMER
MID-TO-LOW INCOME CONSUMER
95 stores
944
stores
Shopping Centers
53
Shopping Centers
FinancialServices
USD 1.812 bn Loan
Portfolio
• JV’s: Chile, Brazil &
Colombia
• Cencosud: Peru &
Argentina
88 stores
Fourth Quarter
15.4 15.5
A Development Story
thru Organic Growth & Acquisitions
Corporate Presentation | Cencosud Snapshot | 9
Acquisitions & Revenues (USD bn)1
19821976 1988 1993 2000 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 20152014
OPENED THE FIRST SUPERMARKET
IPO SANTIAGO
STOCK EXCHANGE
IPO NYSE
1 Figures translated into USD at end of period exchange rate as of December 2015 (CLP/USD 710,2).
14.8
13.1
10.9
8.9
7.9
8.8
5.4
4.5
3.6
2.0
Fourth Quarter
73%
27%
Fixed
Variable
A Development Story
thru Organic Growth & Acquisitions
Corporate Presentation | Cencosud Snapshot | 10
2,0
3,1
3,7
6,3
4,74,3
3,2
2009 2010 2011 2012 2013 2015 2014
Net Financial Debt Evolution (USD BN)1
1 Figures translated into USD at end of period exchange rate as of December 2015 (CLP/USD 710,2).2 Considers only principal amortizations and excludes banking operations.
3 Net Financial Debt / Adjusted EBITDA. 2015 ratio calculated with figures as of December. In 4Q15 Fair Value of Derivatives was reclassified from “Other gains/losses” to “Net Financial Cost” and “Income/Loss from
foreign exchange variations”. 2014’ & 2015 ratios are comparable,4 After CCS
Breakdown by Interest Rate4Breakdown by Currency4Leverage Ratio3
Amortization Schedule (USD MN)2
49%
15%
32%
1% 2% 1% CLP
UF
USD
PEN
BRL
ARS
2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2045
250125
224
49
203
778
17
1,217
32
696
47 37
200
37 1476
350
2009 2010 2011 2012 2013 2014 2015 2015*
2,6 2,7
4,6
3,13,4
3,73,3
2,8
• Investment Highlights
• Cencosud Snapshot
• Key Figures
• Strategy
• Corporate Governance
Contents
Corporate Presentation | Contents | 11
Income Statement
Corporate Presentation | Key Figures | 12
(In millions of Chilean pesos as of December 31st, 2015)
2015 2014 ∆ % 2015 2014 ∆ %
Net revenues 3.048.854 3.014.833 1,1% 10.991.338 10.711.029 2,6%
Cost of sales -2.143.598 -2.177.047 -1,5% -7.813.226 -7.827.432 -0,2%
Gross profit 905.256 837.785 8,1% 3.178.112 2.883.597 10,2%
Gross margin 29,7% 27,8% 190 bps 28,9% 26,9% 199 bps
Selling and administrative expenses -682.708 -686.612 -0,6% -2.675.486 -2.482.777 7,8%
Other income by function 145.154 78.038 86,0% 210.521 114.438 84,0%
Other gain (Losses) -1.369 -1.648 -16,9% -63.082 -6.515 868,3%
Operating income 366.333 227.564 61,0% 650.065 508.743 27,8%
Participation in profit of equity method associates 5.296 5.730 -7,6% 14.067 8.893 58,2%
Net Financial Income -75.981 -49.025 55,0% -244.100 -173.548 40,7%
Income (loss) from foreign exchange variations -9.600 -3.657 162,5% -116.743 -24.411 378,2%
Result of indexation units -6.113 -13.207 -53,7% -22.009 -39.576 -44,4%
Non-operating income (loss) -86.398 -60.158 43,6% -368.784 -228.642 61,3%
Income before income taxes 279.935 167.405 67,2% 281.281 280.101 0,4%
Income taxes -92.400 -66.908 38,1% -58.540 -100.486 -41,7%
Profit (Loss) from continued operations 187.535 100.497 86,6% 222.740 179.615 24,0%
CONSOLIDATED INCOME DATA
Fourth Quarter
Twelve-Month, ended December
31st
• Investment Highlights
• Cencosud Snapshot
• Key Figures
• Strategy
• Corporate Governance
Contents
Corporate Presentation | Contents | 13
Fourth Quarter
Regional Efficiency
Measures
Short-term Roll Out
Cost Savings of 120 Bps in
SG&A/Sales
Headcount reductions
One-time severance payments
Store level service unaffected
Corporate Presentation | Strategy | 14
Fourth Quarter
Intervention of
Underperforming
Stores
Set-up of Performance Review Committee
120 Stores Across Our Geographic Footprint
Review of Lease Agreements
Changes to Assortment
Headcount Review
Possible Closure
Corporate Presentation | Strategy | 15
Fourth Quarter
Omni channel
Experience
Per Format Platform Development –
Leverage on Current Wallet Share –
Channel Innovation – Human Brands
– Health & Wellness
Corporate Presentation | Strategy | 16
Fourth Quarter
Strategic Focus
On Brazil
Maneuvering Macro and Political –
Deterioration – Slow Capture of
Synergies - Margin Improvements –
Atacarejo – SG&A
Corporate Presentation | Strategy | 17
Corporate Presentation | Contents | 18
• Investment Highlights
• Cencosud Snapshot
• Key Figures
• Strategy
• Corporate Governance
Contents
Source: ILACAD and US Census Bureau, figures as of December 2013
2015
Corporate Presentation | Corporate Governance | 19
Ownership Structure
Ownership Structure
The direct and indirect participation of Mr. Horst Paulmann Kemna
and his immediate family in Cencosud S.A. is over 60.03%
60,0%16%
1%
23%
Controlling shareholders Chilean Pension Funds ADS Others
As of December 31, 2015 Cencosud S.A. capital was made up of
2,828,723,963 common shares held by 1.710 shareholders
Corporate Presentation | Corporate Governance | 19
Source: ILACAD and US Census Bureau, figures as of December 2013
• Board elected on April 26th 2013 for the 2013-2016 period
• New Board to be elected in 2016’s AGM, for a period of 3 years
• Seasoned 9 Member Board:
• 3 Family members: Horst Paulmann, Peter Paulmann and
Heike Paulmann
• 2 Independent members: David Gallagher and Richard
Büchi
• Mr. Wong presented his resignation on August 26th 2015
• Board of Directors Committee:
• Roberto Philipps
• David Gallagher (Independent)
• Richard Büchi (Independent)
Corporate Presentation | Corporate Governance | 20
Board of Directors
Corporate Presentation | Corporate Governance | 21
• Cencosud has a CSR
strategy for each business,
adapted to each country
they operate.
• Common and defined
groups of interest
• Commitments to each
stakeholder
• Programs that build
internal and external brand
value
Employees
Suppliers
Community
Environment
Customers
Corporate Social Responsibility
Corporate Presentation | Corporate Governance | 22
Corporate Social Responsibility
ENVIRONMENT
CUSTOMERS
EMPLOYEES
SUPPLIERS
COMMUNITY
HOME
IMPROVEMENTSUPERMAKETS
DEPARTMENT
STORES
WASTE MANAGEMENT
REUSABLE BAGS
HEALTHY NUTRITION
LABOR INCLUSION
Elderly, Disability
DEVELOPMENT OF SMALL
SIZE SUPPLIERS
SEDEX
JUMBO CIRCUS
CORSO WONG
WASTE MANAGEMENT
REUSABLE BAGS
HEALTHY CONSUMPTION
LABOR INCLUSION
Quality of Life - Work
DEVELOPMENT OF SMALL
SIZE SUPPLIERS
SUSTAINABLE COLECTIONS
PARIS PARADE
WASTE MANAGEMENT
ECO EASY
LABOR INCLUSION
SEDEX
“LEVANTEMOS CHILE”
CHALLENGE, A roof for my
country
The information contained herein has been prepared by Cencosud S.A.
(“Cencosud”) solely for informational purposes and is not to be construed as a
solicitation or an offer to buy or sell any securities and should not be treated as
giving investment or other advice. No representation or warranty, either express or
implied, is provided in relation to the accuracy, completeness or reliability of the
information contained herein. Any opinions expressed in this presentation are subject
to change without notice and Cencosud is under no obligation to update or keep
current the information contained herein. The information contained herein does not
purport to be complete and is qualified in its entirety by reference to more detailed
information included in the preliminary offering memorandum. Cencosud and its
respective affiliates, agents, directors, partners and employees accept no liability
whatsoever for any loss or damage of any kind arising out of the use of all or any
part of this material.
This presentation may contain statements that are forward-looking subject to risks
and uncertainties and factors, which are based on current expectations and
projections about future events and trends that may affect Cencosud’ s business.
You are cautioned that any such forward-looking statements are not guarantees of
future performance. Several factors may adversely affect the estimates and
assumptions on which these forward-looking statements are based, many of which
are beyond our control.
Corporate Presentation | Disclaimer | 23
24
Marisol Fernández León
IR Manager
Phone +562 2959 0545
Natalia Nacif
Senior IR Analyst
Phone +562 2959 0368
Corporate Presentation | IR Contact Information |
Upcoming Events
Cencosud announces First Quarter
2016 Results Schedule
Wednesday, May 25
1Q16 Earnings Conference Call
Thursday, May 26
Southern Cone & Andean
Opportunities Conference
Buenos Aires, Argentina, May 11-12
11th. Annual J.P. Morgan Global
Consumer and Retail Conference
London, May 17-18
Valentina Klein
IR Analyst
Phone +562 2200 4305