Grupo SURA Corporate Presentation Q1-2019
Disclaimer The forward- looking statements contained herein are based on Management’s current forecasts and outlook. For better illustration and decision-making, figures for Suramericana, SURA Asset Management and its subsidiaries are administrative rather than accounting, and therefore may differ from those presented to official entities. Thus, Grupo de Inversiones Suramericana assumes no obligation to update or correct the information contained in this presentation. Figures from income statement are converted to USD with an exchange rate of 3,137.3 COP/USD (average exchange rate for 2019), other financial figures are converted to USD with an exchange rate of 3,174.8 COP/USD (rate for end of period Q1-2019) only for re-expression purposes. 2
Latam Economies CHILE COLOMBIA PERU MEXICO Mining activity afecting Continue on a mild Economic activity More uncertain growth, but gradual recovery remained soft external context improvement still expected 3.1% 3.4% 3.8% 0.8% - 1.8% GDP GDP GDP GDP 3.0% 4.25% 2.75% 8.25% Current Policity rate Current Policity rate Current Policity rate Current Policity rate 3.0% 4.25% 2.75% 8.0% - 8.25% Expected eop Expected eop Expected eop Expected eop 2.8% 3.2% 2.6% 3.7% Inflation Inflation Inflation Inflation USD 15,000 USD 6,300 USD 6,800 USD 9,300 GDP per capita (2017) GDP per capita GDP per capita GDP per capita Pacific Alliance countries less vulnerable than other EM economies, fundamentals still healthy 3 Expected figures for 2019 unless otherwise stated. EOP: end of period 2019
Leading Financial Services Group in Latam with a solid and diversified portfolio 11 countries 51 million clients #1 PENSION FUND #1 INSURANCE #1 COLOMBIAN INDUSTRIAL MANAGER COMPANY BANK INVESTMENTS in Latam, with a in Colombia, with an with a leading with relevant positions growing voluntary established growth presence in Central in attractive markets savings business platform in Latam America USD 53.5 bn USD 140 bn USD 5.1 bn in AUM in Operating Revenues in loans A S S E T S M A N A G E D B Y O U R M A R K E T C A P I N V E S T M E N T G R A D E : B R A N D E M P L O Y E E S * R E C O G N I T I O N USD 6.6 bn 59,000 S T R A T E G I C I N V E S T M E N T S * FITCH BBB S&P BBB- ~60% USD 225 bn M a r c h 3 1 , 2 0 1 9 4
Diversified Investment Portfolio and other investments Insurance, trends Cement, energy and risk management and infrastructure 1.4% 81.1% STAKE 35.2% STAKE* 11.9% 19.6% 11.9% USD Processed food 11.0 b n 35.2% STAKE 26.6% Pensions, asset and 28.7% wealth management 83.6% STAKE Universal banking 46.1% STAKE* 75% 50% Note: *SURA AM valued at the last transaction (CDPQ), in financial in publicly Suramericana at 1.8x BV and companies listed at market services listed companies value at the end of the quarter. 5 *Stakes in common shares
OUR PORTFOLIO Estimated value 0.2 11.0 1.3 1.3 9.5 2.9 1.6 2.2 3.2 GRUPO OTHER PORTFOLIO DEBT PORTFOLIO CAP. SURA AM SURAMERICANA BANCOLOMBIA GRUPO VALUE NUTRESA ARGOS (HOLDING) VALUE (-) BURSÁTIL DEBT M A R K E T C A P I T A L I Z A T I O N S H A R E S A D T V C O M M O N S H A R E ( M a r . 3 1 , 2 0 1 9 ) ( C O M M O N + P R E F ) P R I C E D 6.6 bn D 1 1.5 D 5.6MM US US US Average LTM as of Q1-2019 +14.1% (Var% YTD) SURA AM valued at the last transaction (CDPQ), Suramericana at 1.8x equity and companies listed at market value at the end of the quarter Portfolio valuation estimated by Grupo SURA. Does not constitute an investment advisory Figures in USD bilion
History & Growth Stages INSURANCE INTERNATIONAL LEADERSHIP EXPANSION in Colombia Multi Latin, financial services group 1 9 4 4 / 1 9 9 0 2 0 0 7 / 2 0 1 6 2 0 1 7 - 1 9 9 0 / 2 0 0 7 FOOTPRINT FINANCIAL OPTIMIZATION SERVICES divestment of annuities leader in Colombia business (Chile and Peru) 7
Building a Regional Platform with a Long Term View BECOMING THE CREATING LONG AND THE 4TH WITH A FOCUS ON LARGEST PENSION FUND TERM RELATIONS LARGEST LATAM FINANCIAL STRENGTH MANAGER IN LATAM WITH OUR CLIENTS INSURANCE GROUP # of clients AUM Dividends Gross received from from pension written premiums management our portfolio business 14 51 USD 10 bn USD 140 bn USD 90 USD 330 USD 1.2 bn USD 5.1 bn MILLION MILLION MILLION MILLION 2 0 1 0 2 0 1 9 2 0 1 0 2 0 1 9 2 0 1 0 2 0 1 9 E 2 0 1 0 2 0 1 9 SUCCESSFUL % Dividends & Net Income from Colombia # of countries DIVERSIFICATION FROM COLOMBIA 3 100% 45% 11 8 2 0 1 0 2 0 1 9 2 0 1 0 2 0 1 8 Nota: 2019 figures are LTM as of Q1-2019
Geographic Footprint P O P U L AT I O N C L I E N T S F I N A N C I A L S E R V I C E S 520 MM 51 MM + 1 . 1 % C A G R ( 2 0 0 0 - 2 0 1 8 ) I N 11 C O U N T R I E S P E N E T R AT I O N * B A N K I N G I N S U R A N C E P E N S I O N 3.1% vs . 7.8% 31% vs . >80% ~ 4 8 % vs . > 150% f o r a d v a n c e d c o u n t r i e s f o r U S a n d U K f o r U S a n d E U D R I V E R S ECONOMIC MIDDLE UNDER FORMALIZATION DEMOGRAPHICS GROWTH CLASS PENETRATED OF THE FORMATION SECTORS ECONOMY 9 *Penetration as measured by Premiums/GDP of the countries were Suramericana has presence, AUM/GDP in the countries were SURA AM has presence and loans/GDP in Colombia.
Corporate Strategy Purpose: Create well-being and sustainable development for people, organizations and society. Aspiration: to become a referent Latin American Group in the financial services sector, thanks to our ability to evolve and provide superior added value to shareholders and society. STRATEGIC PRIORITIES STRATEGIC PILLARS Financial management ➢ Transformation and evolution of our businesses ➢ Financial strength and investment power Human talent and culture ➢ Delivering greater value to our clients Innovation and entrepreneurship Internal and external alliances Trust and reputation Knowledge ALIGNING OUR BUSINESSES WITH METRICS AND GOALS C O N T R I B U T I O N T O S O C I E T Y • T R U S T • S U S T A I N A B I L I T Y V A L U E C R E A T I O N • • Brand and Market development, externalities ROE Dow Jones reputation and contribution to SDG EVA Sustainability Index positioning 10
Portfolio Management Strategy SH AREHOLDER VALUE R ETU RN ON C APITAL GR OW TH S YS TEMATIC C A PITAL MAN AGEMENT AT STRATEGIC PR OACTIVE C OR PORATE A D D IN G AC QUISITIONS D IVESTITURES VALUE TO U N ITS ALLOCATION A GR ANULAR LEVEL BE A BETTER OWNER BE IN GOOD BUSINESSES • Focus on value • After an intensive • Understanding of • Review capital • Position ourselves creation, granular expansion phase, competitive exposure and for future profitable analysis for whole focus on profitability advantages and allocation process growth. portfolio. and organic growth. value creation levers criteria. of each operation. 11 * Source: McKinsey
Grupo SURA’s Financials Evolution CONSOLIDATED REVENUES* HOLDING COMPANY RECEIVED DIVIDENDS 331 316 ~3.5x 3.2% -0.8% 290 268 6.2% 256 2010 Dividends 31.2% 6,328 6,184 6,133 5,825 189 Bancolombia 173 4,441 SURA AM 140 Grupo Argos 95 93 Grupo Nutresa Protección Suramericana Other 2 0 1 5 2 0 1 6 2 0 1 7 2 0 1 8 2 0 1 9 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019E LTM T o t a l r e v e n u e s CONSOLIDATED NET INCOME CONT. OPERATIONS HOLDING COMPANY CASH FLOW (2019E) 20.4% -18.0% 7.6% 17.8% 36 341 492 492 305 528 101 508 448 422 417 101 103 2 0 1 5 2 0 1 6 2 0 1 7 2 0 1 8 2 0 1 9 OPERATING INTEREST DIVIDEND CASH DIVIDENDS AND OPERATING LTM CASH FLOW PAYMENT AVAILABLE OTHER INCOME EXPENSES & N e t i n c o m e 12 TAXES *Consolidated revenues figure includes Exchange Difference Figures in USD million
Grupo SURA Individual Debt 550 D E B T M AT U R I T Y P R O F I L E » C R E D I T R AT I O S » N E T D E B T / 300 D I V I D E N D S ( F T M ) 220 4.65x 141 91 77 63 52 31 31 Max. 5x - - 2019 2020 2021 2022 2023 2024 2026 . 2029 2030 . 2049 I N T E R N A T I O N A L B A N K S L I Q U I D I T Y L O C A L B O N D S R E P O S B O N D S 1.2x USD 1.56 bn » F I N A N C I A L D E B T: Min. 1.2x 19 % 24 % L O A N T O VA L U E B A N K S CURRENCY U S D 14.2% TYPE OF B O N D S C O P EXPOSURE* DEBT Max. range 25-30% 76 % 81 % 13 Figures in USD million
HIGHEST NET INCOME FIGURE In the last 16 quarters, driven by positive results in the different business lines CONSOLIDATED OPERATING REVENUES Q1-2019 NET INCOME Businesses continue USD SD USD SD • Operating • Fx effect at with positive dynamics growth holding company 1.6 bn 178.6 MM in growth and operating results 12.4% 80.6% • Investment • Equity method income HOLDING COMPANY CASH FLOW STRATEGIC PRIORITIES • Expected dividends • Estimated free cash • Total dividend distribution approved at • Transformation and evolution of our businesses from investments flow AGM USD USD USD • Financial strength and 330 MM 102 MM 103 MM investment capacity 24% 6.2% • Higher value creation for customers
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