Parques Reunidos Corporate PresentationApril 2017
2
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Current and future analysts, brokers and investors must operate only on the basis of their own judgment taking into account this disclaimer, as to the merits or the suitability of the securities for its purpose and only on such information as is contained in such public informationhaving taken all such professional or other advice as its considers necessary or appropriate in the circumstances and not reliance on the information contained in the Presentation. In making this Presentation available, Parques Reunidos gives no advice and makes norecommendation to buy, sell or otherwise deal in shares in Parques Reunidos or in any other securities or investments whatsoever. These analysts, brokers and investors must bear in mind that these estimates, projections and forecasts do not imply any guarantee of ParquesReunidos ´s future performance and results, price, margins, exchange rates, or other events, which are subject to risks, uncertainties and other factors beyond Parques Reunidos ´s control, such that the future results and the real performance could differ substantially from theseforecasts, projections and estimates.
The information in this document, which does not purport to be comprehensive, has not been independently verified and will not be updated. The information in this document, including but not limited to forward-looking statements, applies only as of the date of thisdocument and is not intended to give any assurances as to future results. Parques Reunidos expressly disclaims any obligation or undertaking to disseminate any updates or revisions to the information, including any financial data and any forward-looking statements, containedin this document, and will not publicly release any revisions that may affect the information contained in this document and that may result from any change in its expectations, or any change in events, conditions or circumstances on which these forward-looking statements arebased or whichever other events or circumstances arising on or after the date of this document.
Market data and competitive position used in this document not attributed to a specific source are estimates of Parques Reunidos and have not been independently verified. In addition this document may contain certain financial and other information in relation to othercompanies operating in the leisure sector. This information has been derived from publicly-available sources and Parques Reunidos accepts no responsibility whatsoever and makes no representation or warranty expressed or implied for the fairness accuracy, completeness orverification of such information.
Certain financial and statistical information contained in this document is subject to rounding adjustments. Accordingly, any discrepancies between the totals and the sums of the amounts listed are due to rounding. Certain management financial and operating measures includedin this document, including number of visitors or revenues per capita, have not been subject to a financial audit or have been independently verified by a third party. In addition, certain figures contained in this document, which have also not been subject to financial audit,are combined and pro forma figures.
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3
Leading global leisure operator of regional parks
Reported revenues of €584 MM in FY 2016 EBITDA of €188 MM 20 MM visitors
#8 Leisure Park Operator Worldwide(2)
#2 European Leisure Park Operator(2)
#1 Water Park OperatorWorldwide
One of the 3, truly global operatorswith a global platform of 61 parks
in 14 countries(1)
ThemeParks
AnimalParks
Water Parks
MECs
OtherNotes1. Includes two parks in Dubai, two parks in Vietnam and five MECs underdevelopment2. Source: Inference from AECOM’s 2014 global attractions attendance report based onattendance
4
Well-diversified portfolio of regional parks
Note1. Other includes Netherlands, UK, Denmark, Argentina
2016 Revenue Geographical Split
40%
24%
7%
6%
7%
4%
Spain
Italy
USAGermany
Belgium
Norway
France
Other(1)
8%4%
Park2
Park3
Park4
Park5
Park6
Park7
Park8Park9
Park10Park11
Park55Park1
8%
2016 Revenue Split By Park
USASpain
21%
60%80%
20% 14%
5%
We benefit from a truly diversifiedportfolioRegional park business model resilient to
adverse macro economic conditions
Strong regional brands
Good value for money proposition
Stable, predictable local demand
Low dependence on tourism
Non destination parks
Highly regarded park portfolio with strong local brands and access to hot IPs
Highly regarded strong local brands
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Oldest park in North America (1846)
Spain’s largest urban park
Second largest leisure park in Italy
A leading park in Germany
Designated a US National Historic Landmark
Largest New York area water park and one of America’s top water parks
Proven ability to obtain hot IPs
Growing market with highly attractive fundamentals
Proportion of income dedicated towards leisure and recreational activities is expected to rise
Growing middle class
More than half of the world's population is aged below 30: the main target group for leisure parks
Tourism is expected to continue growing
Scarcity of suitable locations without strong incumbent players
Significant initial capex requirements and time to build a new park and long lead time to reach breakeven
Scarcity of management know-how
Lack of economies of scale from a single park
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High barriersto entry
Strongstructural
growth drivers
Fragmented market with significant
potential for consolidation
Market largely composed of small to medium individual parks and independent operators
Family and state-owned companies, whose owners are expected to be sellers overtime
Limited number of competitors targeting similar acquisition targets
Positive recent market trends
Ongoing macroeconomic and consumer spending recovery
Increasing number of new developments of greenfield projects in Asia and the Middle East that require industry
management skills
Introduction of new entertainment concepts: Mall Entertainment Centers (“MECs”)
Continuous benchmarking across 61 parks
Over 300 cost / cash flow KPIs monitored on a park level monthly
State-of-the-art IT systems
Best practice transfer between existing and new parks
Proven capacity to operate all type pf parks across multiple regions
Best in class operators
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Our parks are consistentlyoperated at
high margins
Our ability to benchmark is a
uniquemanagement
tool
0 500 1.000 1.5000%
15%
30%
45%
60%
75%
0 250 500 750 0 250 500 750 1.000 Visitors
2016 Parks EBITDAR margin
Water Parks Theme Parks Animal Parks
35,2
0
120
80
40
160
2004 2016
Proven track record becoming a truly global and diversified player
€MM
240
200188
8
22 parks
5 countries
58% Revenue in Spain
61 parks
14 countries
24% Revenue in Spain-34
…whilst de-risking the business model
Delivering growth and improving efficiency…
Parques Reunidos 2006 Parques Reunidos TODAY
Parques Reunidos EBITDA
+9
+39
Clear and well-defined strategy focused on growth
4 new projects
€33 MM capex
20% ROIC
Dubai opening
Vietnam
Ongoing active
negotiations
5 lease agreements signed
Strong pipeline Lionsgate agreement
New potential licensing
agreements
2 3 4
9
Multiple top line growth initiatives Expansion Capex
2Management
Contracts
32MECs
Selective Acquisition Strategy
32 4
5
Season Passes
IPs
Off season events
Ticketing and In-Park revenue
New attractions
Virtual Reality
Operational discipline
1
Penetration of Season passes
% of 2016 TicketingRevenue
Key Initiatives
Launch multi-tier season passes with differentadvantages and prices
Up-selling initiatives
Marketing campaigns
Black Friday sale Christmas campaign Exclusive events targeting pass holders
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Strong potential to continue growing in season passes, bringing more loyal customers, enhancing visibilityofearnings and reducing the impact of weather on the business
Include entry level passes with limited advantages
Top Line iniciatives
Season passes1
11%13%
5%
16%
0%
2%
4%
6%
8%
10%
12%
14%
16%
18%
Group Spain RoE US
Start Trek IP license:
10 year agreement in connection with a themed area at Movie Park Germany
The first and only Star Trek themed coaster worldwide
2nd largest coaster at Movie Park
11
We operate very strong regional brands and, when convenient, we leverage on other brands
Top Line iniciatives
New IP Licensing Agreements1
We have shown our ability to operate hot brands
12
Off season revenues are growing on the back of off season events
+18% revenue growth achieved in 2016 Halloween Season(1)
Extend length of the events (more days)
Extend length of stay (more hours)
Develop and roll-out new off season events: Spring and late Summer
Continue to roll-out existing off season events
Note1. Only includes revenues from those parks with Halloweenevent
2016 Halloween SeasonKey Initiatives
Top Line iniciatives
Expand the season – Off season events1
Yield Management Dynamic Pricing
Push high yield channels and increase percaps in each channel
Reduced discounts along the season by increasing low promotions discounts (15%-25%) and reducing strong promotions discounts (25%-40%)
Control and restrict number of coupons that are launched to the market (i.e.: online coupons, urban check tickets)
Include Blackout dates in promotions for high attendance days (i.e.: Halloween or 15th August in Summer)
Reduce period to redeem promotions to create a sense of urgency to the customer and avoid discounting during high attendance periods
Increase prices associated to new attractions or events
Flexible pricing structure
Price established per day according to visitor demand
Five different scenarios
Price adjusted depending on booked demand
13
Status of implementation (direct channels)
In 2015: 5 parks in Spain in 2015
In 2016:
-Rest of Spanish portfolio and rest of Europe
-US: Flexible calendar pricing at Splish Splash
In 2017:
-Spain and rest of Europe: 2nd / 3rd season with dynamic pricing
-US: Flexible calendar pricing at water park portfolio and Kennywood
Top Line iniciatives
Ticketing Revenues
13
1
Parques Reunidos is always pursuing new ways to raise in-park per caps
Introduce all-inclusive offers
Offer VIP products and services
CRM initiatives
14
ExamplesKey actions
Top Line iniciatives
In Park revenues
Enhance throughput
Introduce new upchargeexperiences
Develop branded partnerships
Improve facilities
1
15
New attractions are a key factor to drive attendance and increase percapsRecurrent capex (maintenance and new attractions) represent 10-11% of annual
revenues
Extension ofNickelodeon
Area
Top Line iniciatives
New attractions coming in 2017
Merlin’s Mayhem Magical Flying
Coaster
Coaster GoldRush
Phobia Coaster (2016)
1
Improves guest experience
Reduces capital needs
Flexibility to easily update VR themes every
season or during the same season
Potential extend VR capabilities to other rides
The first virtual reality coaster
in the Benelux
In partnershipwith Samsung
The Revolution, one of the
most popular family rides
Bobbejaaland (2016 Seasson)
Coming in 2017 Season
Batman´s Escape @ Warner Park
Upcharge experience
ExamplesExamplesKey Benefits
Top Line iniciatives
New Virtual Reality Coasters
16
1
Sky Rocket Coaster @ Kennywood
Strong and visible growth opportunity
17
Second gate parks or hospitality in available space within or adjacent to an existing park that generates benefit from low operational risk and high visibility of target attendance (vs. a greenfield project)
Efficient use of unexploited space (c.400 acres of available land)
Significant cross selling opportunity
Tangible cost synergies by leveraging on the structure of the main park
Lower investment requirements by leveraging on existing facilities and rides
4 different types of expansion projects facilities already successfullyproven
Already developed in
Marineland
Hotel
Already developed in
Lake Compounce
Camping
Already developed in Marineland
and being developed in Miami
Lagoon
Already developed in
Mirabilandia and Slagharen
Water park
Expansion capex projects
Expansion capex projects: Maximizing the value of the existing portfolio2
Investment: c.€8MM
Strategic rationale
Extend length of stay with more content for a 2 dayvisit
Expand catchment area
Enhance product offering
Expected ROIC: +20%
Investment: c.€8MM
Strategic rationale
Expand capacity of the existing lodging
Increase off season attendance onthe back of the new indoor water park
Improve story telling experience and upgrade existing facility
Expected ROIC: +20%
Investment: c.€4MM
Strategic rationale
Indoor aquarium in the New Hampshire White Mountains (popular destination in summer for outdoor recreation and winter for skiing)
Strong product bundling options (2 day stay, hotel packages and annual passes)
Year round operation
Expected ROIC: +20%
18
3 projects identified and approved for development in 2017 and are expected to open in 2017 /18Represent c.€33 MM of investment to be incurred in 2017 and 2018
Expansion of Warner Beach Extension of lodging facilities Living Shores Aquarium
Expansion capex projects
Expansion capex: 2017 projects2
1
Operated by:
4 themed zones: Studio Central, DreamWorks, Smurfs Village and Sony Pictures Studios
27 attractions locatedin an open park
Key brands: Shrek, Madagascar, Kung Fu Panda and How to Train YourDragon
Licensed IPs: DreamWorks, Sony Pictures and Lionsgate
Six themed zones: Bollywood Boulevard, Mumbai Chowk, Rustic Ravine, Bollywood Film Studios, Hall of Heroes and Royal Plaza (includes Rajmahal theatre with separate ticketing)
16 different rides
Licensed IP from Bollywood film studios
2
4
55
19
A €3,400 MM premier year-round regional leisure and entertainment destination Motiongate and Bollywood parks represent the largest investments in the entire leisure destination Both parks opened in 2016
Management contracts
Dubai Parks
3
3
10 year management contract with Sun Group to operatea theme park and a water park in Vietnam
Dragon Park opened in january 2017; Typhoon Water Park opened in april 2017.
First class theme park and water park located in Ha Long City with 214 hectares
Fees structure
Development fee
Management fee: Variable fee based on performance (linked to both revenues and EBITDA) and with a minimum fee guaranteed
20
Recently awarded a new management contract in Vietnam; expanding our presence intoAsiaDragon Park opened in january 2017; Typhoon Water Park will open during Q2 2017
Key Terms of the Agreement
Management contracts
Vietnam
20
3
New ad-hoc leisure concepts located in high-traffic areas developed in partnership with the owner of the facility
Small indoor facilities, of c.4,000 – 7,000 sqm, located in urbancenters
Win–win opportunity
Illustrative example: Financing shared 50% / 50% with Real Estate Developer
21
Large number of opportunities worldwide
Attractive value proposition for shopping mall developers globally
Very limited competition and with limited product overlap
Indoor parks that further hedges PQR seasonality exposure
Strong, visible and growing pipeline of opportunities
…with strong growth fundamentals
Simple business model… The feasibility analysis works
Visitors (‘000) 300
Percap (€) 16.0
Revenue (€MM) 4.8
EBITDAR (€MM) 1.9
% Margin 40.0%
Rent paid to real estate developer (€MM) 0,8
% Revenue 17.0%
EBITDA (€MM) 1.1
% Margin 23.0%
Required investment (€MM) 10.0
PQR investment (€MM) 5.0
Developer investment (€MM) 5.0
PQR ROIC 22.1%
MECs
The roll-out of MECs, a highly attractive growth opportunity4
Atlantis Aquarium
Lionsgate Centre
Lionsgate ‘s strong international IPs Nickelodeon ‘s strong international IPs
Nickelodeon Adventure Splash Water Park Rainforest Adventure ParkAtlantis Aquarium
MECs
Designed MEC concepts
22
* Estimated figures
Area 3,500-5,000 sqm
Visitorcapacity 1,000-1,200 (max)
MainAttrations
Horror Walkthrough
Interactive Dark Ride Media/VR Simulator Branded Escape
Rooms Media-Enhanced
challenge course Live Stage Show
Key Features *
Area 5,000-7,500 sqm
Visitorcapacity 1,000-1,200 (max)
MainAttrations
Playground Mini rides and
Attractions
4D Cinema Photo Call Driving school
Play stage Big space with more
than 20 interactivegames
Party rooms
Key Features *
Area 6,000 sqm
Visitorcapacity 1,700 (max)
MainAttrations
Wave Pool Spa Area Slides and loops
Lazy River Children’s area
Key Features *
Area 6,000 sqm
Visitorcapacity 1,500 (max)
MainAttrations
Mangrove Sea Lemur Interaction Otter Habitat
Jungle Trail Interactions
and pavilions
Tropical birds
Key Features *
Area 5,000 sqm
Visitorcapacity 1,500 (max)
MainAttrations
Coral ReefExperience
Shark Experience
Penguin Encounter Big Main Tank Touch pools
Interactions and pavilions
VIP Divingexperience
Key Features *
4
Over 20 additional situations being discussed and at different stages
Provides high visibility to accomplish our targets for the period 2017-20
MECs Location Real Estate Operator ConceptLease Agreement
Signed Expected Opening
THADER Murcia, Spain Metrovacesa Nickelodeon Mar-16 Q4-17
LAKESIDE London, UK Intu Nickelodeon May-16 Q4-18
LISBON Lisbon, Portugal Intu Nickelodeon Jul-16 Q2-18
XANADU Madrid,Spain Ivanhoe Nickelodeon Jul-16 Q4-18
XANADU Madrid,Spain Ivanhoe Aquarium Jul-16 Q1-18
23
Already accomplished our 2017-18 goals Large and growing pipeline
On going conversations to analyse new potential projects are taking place
MECs
MECs: Strong pipeline of opportunities
SignedContracts
Pipeline
4
24
Acquisition #Parks Country YearAcquired ImpliedEBITDA
multiple paid(1)
Bobbejaanland 1 Belgium 2004
BoSommarland 1 Norway 2006
Marineland 1 France 2006
Mirabilandia 1 Italy 2006
Warner 1 Spain 2007
Aqualud 1 France 2007
GrantLeisure 3 UK 2007
BonBonLand 1 Denmark 2007
Tusenfryd 1 Norway 2008
Faunia 1 Spain 2008
Palace Group(FECs) 31 US 2008
Hawaii 1 US 2008
Kennywood Group 5 US 2008
Movie Park 1 Germany 2010
Dutch Wonderland 1 US 2010
Slagharen 1 Netherlands 2012
Noah’sArk 1 US 2012
Miami Seaquarium 1 US 2014
Total 54 5.8x
All elements are in place to continue being the leading consolidator
Notes1. Based on EBITDA after 2 full seasons under Parques Reunidos operation
18 transactions successfully completed across 10 countries since 2004
Implied EBITDA multiple paid(1) post integration of 5.8x
Target average EBITDA improvement of c.50% after 2 full seasons under Parques Reunidos management
Selective adquisicitions
Unique track record sourcing, executing and creating value through acquisitions5
25
Attractive financial profile delivering growth
EBITDA Margin 30.9% 32.3%
167
188
100
150
200
2013 2016
541
584
400
500
600
700
2013 2016
€MM
Revenue
EBITDA
€MM
26
Note1. Excludes rents
17%
42%
(Variable Costs)
Operating Costs
Relentless attention to detail and continuous reconsideration of every item of the cost structure
Group Operating costs as % of Revenues
Over 20 lines of variable costs items and over 150 lines of continuous benchmarking operating costs are analysed ona monthly basis
% of total costs 2016Cost item
38%
3%
3,4% 2,4% 2,6% 2,4%
26,3%25,3% 25,1% 25,5%
27,5%27,3% 27,9% 28,7%
57,2% 55,0% 55,6% 56,5%
0%
10%
20%
30%
40%
50%
60%
70%
80%
2013 2014 2015 2016
Rents Other Operating Costs Personnel Costs
COGS
PersonnelCosts
Other OperatingCosts(1)
Rents
27
Strong and visible cash flow generation
Stable and resilient cash flow withhigh conversion rates of 65-70%
Group reported operating free cash flow(2)
Notes1. Defined as maintenance of the parks’ facilities + capex for new attractions2. Defined as EBITDA – Recurrent Capex (maintenance of the parks’ facilities + capex for new attractions)3. Defined as EBITDA – Recurrent Capex /EBITDA
Group reported recurrent capex(1)
Cash
Conversion
Rates (3)
57.8% 68.0%
% ofrevenue 13.2% 10.3% 12.4%
61.5%
10 –11% Recurrent capex as % of revenues
No year-on-year operatingworking capital requirements
Cash generated from change in working capital
€MM€MM
54
7162
72
0
50
100
150
2013 2014 2015 2016
4,4
(1,6) (2,4)
-50
0
50
100
150
2014 2015 2016
113
98
133
116
0
50
100
150
2013 2014 2015 2016
€MM
10.0%67.5%
Capital structure designed to allow delivery of business plan
Target capital Structure
DividendPolicy
Current leverage of 2.9x Net debt /EBITDA
On average 2.0x-2.5x target net debt / EBITDA in the medium term
20-30% pay-out ratio
2016 dividend: €20 MM or 26% pay-out ratio on the back of 2016 pro-forma Not Income
DebtStructure
€575 MM term loan facility (60%/40% €/$ denominated)
€200 MM multi currency revolving credit facility
Natural hedged to act against currencyfluctuations
Local currency expenditures at each location
Balanced capital structure between US debt and European debt
28
(5,6)
(0,8)
-8
-5
-3
0
3
Q1 FY16 Q1 FY17
(3,2)
(1,9)
-8
-5
-3
0
3
Q1 FY16 Q1 FY17
Strong current trading performance
66 71
0
25
50
75
100
Q1 FY16 Q1 FY17
6068
0
25
50
75
100
Q1 FY16 Q1 FY17
Reported Figures (€MM) Like-for-like Figures (€MM)
29
Delivered strong Q1 FY17 results
+12% like-for-like revenue growth
+86% like-for-like EBITDA growth
Achieved record in season passes and pre-sales
+50% and +17% growth in revenue from seasonpasses in Spain and RoE respectively
+25% growth in US pre-sales
Enhanced visibility of earnings and reducedweather risk
Continued expanding the season through off-season events
+14% revenue growth achieved in Halloween and Christmas events
Q1 represents c.10% of total revenues
Revenues
EBITDA
Reported Figures (€MM) Like-for-like Figures (€MM)
Why Parques Reunidos?
30
1
2
34
5
We operate in a rowing market with attractive
fundamentals
Leading global player with
strong regional brands
Growing marketwith highlyattractive
fundamentals
Clear and well-definedstrategy focused
on growth
Excellent reputationindustrywide
Partner of choice
6
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