Fourth Quarter Corporate Presentation Cencosud April 2016
Corporate Presentation | Contents | 2 Contents • Investment Highlights • Cencosud Snapshot • Key Figures • Strategy • Corporate Governance
Corporate Presentation | Contents | 3 Contents • Investment Highlights • Cencosud Snapshot • Key Figures • Strategy • Corporate Governance
Corporate Presentation | Investment Highlights | 4 Investment Highlights Leading retailer in Latin America with the highest geographic diversification in the region Core in food retailing business, more resilient to economic downturns 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 | Contents | 5 Contents • Investment Highlights • Cencosud Snapshot • Key Figures • Strategy • Corporate Governance
Corporate Presentation | Cencosud Snapshot | 6 Overview by Business Revenues Dec.2015 Adjusted EBITDA Dec.2015 USD 15,477 MM 1 USD 1,112 MM 4 Support Businesses Retail Areas Support Businesses Retail Areas Shopping Centers & Supermarkets , D-Stores & DYS Shopping Centers & Supermarkets, D-Stores & DYS Financial Services Financial Services USD 680 MM USD 268 MM 1,5% 2,3% USD 11,329 MM USD 349 MM 6.0% mg 76.7% mg 20,3% 6,4% USD 87 MM USD 233 MM 2 USD 84 MM 2 USD 1,481 MM 5.8% mg 36.0% mg 73,3% 96,2% Others: Others: USD 16 MM 3 USD -209 MM 3 USD 202 MM USD 2,069 MM 9.8% mg Retailing Areas Financial Services Real Estate Retailing Areas Financial Services Real Estate 1 Translated into USD at CLP/USD 710.16 2 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. Source: ILACAD and US Census Bureau, figures as of December 2013
Corporate Presentation | Cencosud Snapshot | 7 Overview by Country Revenue Dec.2015 USD 15,477 MM 1 Adjusted EBITDA Dec.2015 USD 1,112 MM 3 Andean Region Atlantic Coast Andean Region Atlantic Coast 4,4% 8,3% 9,7% 9,1% USD 1,291 MM USD 2,369 MM USD 48 MM 2,3% USD 26 MM 37,6% 3.8% mg 1.1% mg 48,3% 15,3% USD 1,401 MM USD 4,592 MM USD 108 MM USD 392 MM 7.7% mg 8.2% mg 35,3% USD 5,824 MM 2 USD 538 MM 2 29,7% 9.2% mg Chile Argentina Brazil Peru Colombia Chile Argentina Brazil Peru Colombia • 245 Supermarkets • • • • 286 Supermarkets 222 Supermarkets 90 Supermarkets 101 Supermarkets • 35 Home Improvement • • • • 50 Home Improvement Atacarejo format 9 Department Stores 10 Home Improvement • 79 Department Stores • • • • 22 Shopping Centers 3 different regions 4 Shopping Centers JV with Colpatria • 25 Shopping Centers • JV Bradesco • JV Scotiabank 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 1 st , 2015. 3 Adjusted EBITDA excluding all one-off charges: CLP 105,038 Source: ILACAD and US Census Bureau, figures as of December 2013
Strong Brand Portfolio Corporate Presentation | Cencosud Snapshot | 8 with High Consumer Recognition Regional Presence / Market Position High and low end brands HIGH INCOME CONSUMER 944 4 th SUPERMARKETS Supermarkets stores NORTHEAST (#2) MINAS GERAIS (#1) RIO DE JANEIRO (#3) MID-TO-LOW INCOME CONSUMER 3 rd SUPERMARKET 2 nd HOME IMPROVEMENT 95 stores Home Improvement 1 st SUPERMARKETS HIGH INCOME CONSUMER 4 th DEPARTMENT STORES 88 stores Department Stores MID-TO-LOW INCOME CONSUMER 53 Shopping Centers Shopping Centers 2 nd SUPERMARKETS 2 nd HOME IMPROVEMENT 2 nd SHOPPING CENTERS 2 nd SUPERMARKETS 2 nd DEPARTMENT STORES • JV’s: Chile, Brazil & 1 st HOME IMPROVEMENT USD 1.812 bn Loan 2 nd SHOPPING CENTERS Financial Colombia • Cencosud: Peru & Services Portfolio Argentina Source: ILACAD and US Census Bureau, figures as of December 2013
Fourth Quarter Corporate Presentation | Cencosud Snapshot | 9 A Development Story thru Organic Growth & Acquisitions IPO NYSE Acquisitions & Revenues (USD bn) 1 15.4 15.5 14.8 13.1 IPO SANTIAGO STOCK 10.9 EXCHANGE 8.8 8.9 7.9 5.4 4.5 3.6 OPENED THE FIRST SUPERMARKET 2.0 2004 2004 2005 2005 2006 2006 2007 2007 2008 2008 2009 2009 2010 2010 2011 2011 2012 2012 2014 2014 2015 2015 1976 1976 1982 1982 1988 1988 1993 1993 2000 2000 2002 2002 2003 2003 2013 2013 1 Figures translated into USD at end of period exchange rate as of December 2015 (CLP/USD 710,2).
Fourth Quarter A Development Story Corporate Presentation | Cencosud Snapshot | 10 thru Organic Growth & Acquisitions Net Financial Debt Evolution (USD BN) 1 Amortization Schedule (USD MN) 2 6,3 1,217 4,7 4,3 3,7 778 778 3,2 696 696 3,1 2,0 350 350 250 250 125 125 224 224 203 203 200 200 76 76 32 32 49 49 47 47 37 37 37 37 17 17 14 14 2009 2009 2010 2010 2011 2011 2012 2012 2013 2013 2014 2014 2015 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2045 Leverage Ratio 3 Breakdown by Currency 4 Breakdown by Interest Rate 4 2% 1% 1% CLP Fixed 4,6 UF Variable 27% 3,7 3,4 3,3 3,1 32% USD 2,7 2,8 2,6 49% 73% PEN 15% BRL ARS 2009 2010 2009 2010 2011 2011 2012 2012 2013 2013 2014 2014 2015 2015 2015* 2015* 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
Corporate Presentation | Contents | 11 Contents • Investment Highlights • Cencosud Snapshot • Key Figures • Strategy • Corporate Governance
Corporate Presentation | Key Figures | 12 Income Statement CONSOLIDATED INCOME DATA (In millions of Chilean pesos as of December 31st, 2015) Twelve-Month, ended December Fourth Quarter 31st ∆ % ∆ % 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% -6.113 -13.207 -53,7% -22.009 -39.576 -44,4% Result of indexation units 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% -92.400 -66.908 38,1% -58.540 -100.486 -41,7% Income taxes Profit (Loss) from continued operations 187.535 100.497 86,6% 222.740 179.615 24,0%
Corporate Presentation | Contents | 13 Contents • Investment Highlights • Cencosud Snapshot • Key Figures • Strategy • Corporate Governance
Fourth Quarter Corporate Presentation | Strategy | 14 Short-term Roll Out Regional Efficiency Measures Cost Savings of 120 Bps in SG&A/Sales Headcount reductions One-time severance payments Store level service unaffected
Fourth Quarter Corporate Presentation | Strategy | 15 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
Fourth Quarter Corporate Presentation | Strategy | 16 Omni channel Experience Per Format Platform Development – Leverage on Current Wallet Share – Channel Innovation – Human Brands – Health & Wellness
Fourth Quarter Corporate Presentation | Strategy | 17 Strategic Focus On Brazil Maneuvering Macro and Political – Deterioration – Slow Capture of Synergies - Margin Improvements – Atacarejo – SG&A
Corporate Presentation | Contents | 18 Contents • Investment Highlights • Cencosud Snapshot • Key Figures • Strategy • Corporate Governance
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