CENCOSUD CORPORATE PRESENTATION 3Q19 - Presentación de PowerPoint
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CENCOSUD CORPORATE PRESENTATION 3Q19
ABOUT CENCOSUD
CONSOLIDATED RETAIL PLAYER IN THE LATAM REGION +6.0 MM SQM OF
LANDBANK TO FUEL
+50 YEARS OF HISTORY FUTURE GROWTH
ACROSS THE REGION
+132K EMPLOYEES ON-GOING SHOPPING
US$ 4.7 BN CENTERS PROJECTS:
5 BUSINESS UNITS
MARKET • LA MOLINA
CAP • LA 65
HOME DEPARTMENT FINANCIAL
SUPERMARKETS SHOPPING CENTERS
IMPROVEMENT STORES SERVICES LISTED ON SANTIAGO STOCK EXCHANGE:
PRESENCE IN 5 COUNTRIES CENCOSUD (2004)
FREE FLOAT: 46.3%
AV. TRADING VOLUME: US$7.3MM
RATED IG BY MOODY’S & FITCH
1,113 RETAIL STORES - 3.6 MM RETAIL SPACE CENCOSUD SHOPPING (2019)
62 SHOPPING CENTERS - 653K GLA TO THIRD PARTIES FREE FLOAT: 28.4%
AV. TRADING VOLUME: US$5.8MM
AA+ RATING BY HUMPHREYS AND FELLER
CENCOSUD’S HISTORY
Acquired Infante, Economax, Foster & Eurofasion.
Purchased Gbarbosa in Brazil and Wong in Peru. JV JV with Scotiabank development of
Opened Mall Alto Las Condes &
Opened 1st in Colombia for the development of Easy. SF in Peru
1st Easy store in Chile
Supermarket
Acquired SM Las Brisas, Montecarlo and Acquired Prezunic in Brazil. Opened Mall
Opened 1st Jumbo store in Disco Costanera Center. Purchased Carrefour in
ARG Santiago Stock Exchange IPO Colombia.
1970 1988 2002 2003 2005 2008 2010 2014 2019
1963 1982 1993 2004 2007 2012 201
8
Launched Financial Services in Chile,
Starts FS operations in JV with Scotiabank for
Opened Mall Unicenter opened Florida Center & Portal La
Argentina. Acquired Blaisten development of SF in Chile
Arg. Dehesa. Acquired SM Santa Isabel in
Chile
Opened Jumbo Acquired Almacenes Paris. IPO of Cencosud
Kennedy Acquired Proterra in Chile & Home Montecarlo & Las Brisas Shopping
rebranded to Santa Isabel Acquired Super Familia in
Depot in Arg.
Fortaleza and Bretas in Brazil
2019 FINANCIAL HIGHLIGHTS SALE OF FINANCIAL SERVICES IN PERU In March of 2019, the Peruvian Superintendence approved the sale 51% of Cencosud’s Bank to Scotiabank for a total of USD 100 million. The purpose of the agreement is to boost growth and co-develop the financial services business in Peru. CENCOSUD SHOPPING IPO In June 2019, Cencosud successfully executed the initial public offering (IPO) of its Shopping Centers division in Chile, Peru and Colombia. Raising USD 1,055 million. Price: $1.521 Total Shares: 472,000,000 The new Company owns a total 39 properties (33) in Chile, (2) in Peru and (4) in Colombia. In addition to 3 plots of real estate in Chile and 2 in Peru. LIABILITY MANAGEMENT AND TENDER OFFER In September the Company performed a tender offer of its 2023, 2025 and 2027 bonds for a total of USD 474 million. In November 2019, Fitch Ratings updated their rating from stable to negative watch.
WHY CENCOSUD?
Established presence in largest
economies of the region
Healthy balance sheet structure Organic growth opportunities in fast
developing countries through our
landbank.
MAIN CORE ETHICS &
SUSTAINBLE VALUES
Strong Corporate Governance
Further development of
our omnichannel strategy
Focus set on productivity &
efficiency
OUR PRESENCE BY COUNTRY
REVENUES BY COUNTRY LTM AS OF SEP’19 ADJ. EBITDA LTM AS OF SEP’19: US$1,166 MM
US$13,836 mm ADJ. EBITDA MG: 8.4%
9%
4%
11% 21%
14% 48% 52%
5%
18% 18%
i: For calculation details please revise page 13
248 284 202 94 96
SUPERMARKETS SUPERMARKETS SUPERMARKETS SUPERMARKETS SUPERMARKETS
36 51 F.S JV WITH BRADESCO 36 10
HOME IMPROVEMENT HOME IMPROVEMENT HOME IMPROVEMENT HOME IMPROVEMENT
78 22 11 4
DEPARTMENT STORES SHOPPIN CENTERS DEPARTMENT STORES SHOPPING CENTERS
33 FINANCIAL SERVICES 3 F.S: JV WITH COLPATRIA
SHOPPING CENTERS SHOPPING CENTERS
F.S: JV WITH SCOTIABANK FS: JV WITH SCOTIABANKOUR PRESENCE BY BUSINESS UNITSi
REVENUES LTM AS OF SEP’19: ADJ. EBITDA LTM AS OF SEP’19: US$1,166 mm
US$13,836 mm ADJ. EBITDA MG: 8.4%
2% STRONG FOOD RETAIL 11%
US$ 321MM PLAYER; MORE RESILIENT TO US$ 136MM
12% ECONOMIC DOWNTURNS 48,1% mg RETAIL SEGMENT
US$ 1,639MM 5% ACCOUNTED FOR 66% OF
EBITDA
US$ 58MM
3.5% mg
12%
US$ 1,667MM
14%
72% US$ 178MM 47%
2% US$ 10,044MM
10.9% mg
US$ 361MM US$ 593MM
6.0% mg
23%
RETAIL SEGMENT ACCOUNTED
FOR 95% OF REVENUES US$ 284MM
79.6% mg.
For calculation details please go to page 13
RECOGNIZED BRAND PORTFOLIOSOUND BALANCE SHEET
LATEST NEWS DEBT BY CURRENCY (AFTER CCS)
● Cencosud executed the IPO for its Shopping Centers division in Chile, Peru
and Colombia raising USD 1,055 million. Proceeds will be use to pay off Otras Latam Otras Latam;
6% 8%
debt. USD
16%
● Cencosud executed a tender offer for its 2023, 2025 and 2027 Bonds for USD
up to USD 474 million. CLP + UF
20%
83% CLP + UF
● Investment Grade rating since 2011 (In Novemeber, Fitch Ratings updated 73%
their ratings from stable to negative)
● Fitch Ratings: BBB- (negative)
● Moody’s: Baa3 (negative)
3Q19 3Q18
NET FINANCIAL EVOLUTION DEBT AMORTIZATION SCHEDULE (US$ MM)
4,4 4,2
3,8 3,9 987
4,6 3,7 3,6
3,5 Deuda
3,3
3,9 3,8 Financiera Neta
3,7 3,7
3,4 (USD mm)
3,3 3,2
605 577 581
424
NFD/EBITDA
Ajustado (veces) 213 192
156
53 48 53 34 50 14
2012
2013
2014
2015
2016
2017
2018
09.2019
19 20 21 22 23 24 25 26 27 28 29 30 41 45ORGANIC GROWTH
CENCOSUD SHOPPING CENTERS PROJECTS: LANDBANK PER COUNTRY (SQM):
COUNTRY Q SQM
LA MOLINA – PERU
LA 65 - COLOMBIA CHILE 36 2.1MM
ARGENTINA 34 3.1MM
BRAZIL 23 328K
LA MOLINA:
• HIGH SEGMENT DISCTRICT PERU 22 129K
• +35.7K GLA COLOMBIA 8 127K
• ANCHOR STORES
• OPENING DATE: 2H2021 CAPEX BREAKDOWN CHANGES IN SELLING AREA
US$ 300 MM
CENCOSUD’S CAPEX 2019
17%
LA 65: 4
• UP & COMING DISTRICT OPENINGS
• +78K GLA 50%
• ANCHOR STORES 32
• OPENING DATE: 2H2022 33% REMODELLINGS
ORGANIC GROWTH
5
RECURRENT CAPEX CLOSURES
TECHNOLOGY & OMNI
STRATEGYOMNICHANNEL STRATEGY
ANY-HOW Long-term objectives:
ANY’S STRATEGY
• Improve websites & apps,
ANY-WHERE surpass industry standards
• Optimized product mix with
ANY-TIME
100% delivery in our stores
ANY-THING • Reduce cost through
automatized tools
ALL THE TIME
SUPERMARKETS FOOTPRINT CHILE ARG COL PER
% FOOD ONLINE 94% 100% 79% 88%
% NON-FOOD ONLINE 66% 100% 239% 62% Ov. Tot. Sales Over Tot.
% SKU DROPSHIP - 8% 63% 26% E-commerce Sales VAR % 19/18 3Q19 Sales 3Q18
Supermarkets 40,5% 1,9% 1,2%
EXPRESS DELIVERY 1.5 HRS 2 HRS 3 HRS 1.5 H5
Department Stores 25,3% 12,0% 8,5%
Home Improvement 41,1% 4,0% 2,6%
Total 33,9% 3,4% 2,2%PRODUCTIVITY & EFFICENCY
SHARED SERVICES CENTER
Offers services to other units, thus reaching functional specialization on
recurring & high volume transaction.
REGIONAL PROCUREMENT &
OPERATING WITH 120 CREATING OVER 650K PAYMENT
ORDERS AS WELL AS RECONCILED
PRIVATE LABEL TEAM
ROBOTS, SSC HAS PROCESSED 14MM
INVOICES 180MM COUPON CARDS.
THE COMPANY CREATED A REGIONAL
PURCHASE TEAM WITH THE
RESULTS: RECOVERED USD 5MM FOR LOSSES BY USD 30.5MM DUE TO PURPOSE OF:
COMMERCIAL AGREEMENT, DECREASED IMPROVED MANAGMENT OF ANNUAL OFF SEASON AVAILABILITY OF
INVENTORY.
PRODUCTS
COST EFFICIENCY IN BIG DATA ANALYTICS
PROCURMENT
BIG DATA ANALYTICS DEPARTMENT
CENCOSUD IS A PIONEER IN THE CREATED OVER TWO YEARS AGO
LATAM REGION FOR CREATING A TAKING ADVANATGE OF THE EXTENSIVE
CENTRALIZED TEAM OF PRODUCT DATABANK OF THE COMPANY
DEVELOPMENT AND PRIVATE LABEL THROUGH THE IMPLEMENTATION OF A
PURCHASING. PLATFORM THAT IDENTIFIES
SYNNERGIES AND PROVIDES INDEPTH
INSIGHTSETHICS & SUSTAINABLE VALUES
KEY DIMENSIONS OF OUR ETHICS CODE PILLARS OF THE SUSTAINTABILITY STRATEGY
2019 HIGHLIGHTS:
o Recognized in Dow Jones
Sustainability Index (DJSI),
placed in the #12 position (up 3
places vs 2018).
Yearly revised ethics code
Trained Board of Directors and Employees on ethics issues.
More than 137,000 people trained on ethics issues and sustainability.
Signed Code of ethics and Code of Conduct by all employees.
Available hotline for unethical behaviorSTRONG CORPORATE GOVERNANCE
BOARD OF DIRECTORS NEW CORPORATE STRUCTURE
Organizational Structure1
Chief Executive Manager
Matias Videla
SM Chile
Peru Manager Argentina Manager Cristian Siegmund
Alfredo Mastrokalos Diego Marcantonio
Dept. Store Chile
Colombia Manager Brazil Manager Ricardo Bennett
Marta Lucia Henao Sebastian Los
Home Imp. Chile
Felipe Longo
NEW MANAGEMENT STRUCTURE WTH THE PURPOSE:
SOX STANDARD SINCE 2012: BOARD OF DIRECTOR COMITTEE
TAKE FURTHER ADVANTE OF LOCAL MARKET KNOWLEDGE
• 7 SEASONED BOARD MEMBER • ROBERTO PHILLIPS
EXPEDITE DECISION MAKING
• 2 INDEPENDET MEMBERS • MARIO VALCARCE
PROMOTE EFFICENCIES ACROSS EACH BUSINES UNIT
• ALEJANDRO PERÉZCALCULATION DETAILS For this presentation the following exchange rates, calculations and details were considered: Market cap calculated as of September 2019 using the stock closing price of CLP 1,200 and average Exchange Rate of CLP 683,06 per US$ Daily average trade volume; Figures as of September 2019 using close stock price CLP $1,200 and an average exchange rate of CLP 683,06 per US$ Adjusted EBITDA represents EBITDA plus exchange differences and gains (losses) from indexation units, minus revaluation of assets. Revenues and Adjusted EBITDA converted to US$ using a last twelve month average exchange rate of CLP $683,06 per US$ Revenues and Adjusted EBITDA include IFRS16 accounting rule for the first 9 months of 2019. Revenue and Adjusted EBITDA graph exclude the “others” segment, which contributes US$12mm in revenues and –US$82mm in Adj. EBITDA. Revenues and Adjusted EBITDA exclude the adjustment of hyperinflation in Argentina (IAS29), including the adjustment, revenues for the LTM period were US$14.189 MM and Adjusted EBITDA was US$1,193 MM, using end of period exchange rate of CLP 679,2 per US$. Argentina represented a 20.3% of total revenues and 20.2% of total Adjusted EBITDA. Debt denominated in US$ using end of period exchange rate as of September 2019. Debt includes liabilities of leases due to the adoption of new IFRS16 rule as well as includes the hyperinflationary effect of Argentina due to IAS29 rule. Amortization schedule is presented net off gains/losses from mart to market of derivatives, overdrafts and Comex debt (excluding forwards). Debt by currency after cross currency swaps.
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