Investor Presentation First Half 2017
A Global Branded Consumer Products Company and the leader in the baking industry 2 2 2
Control Group : 75% Market Cap: US$12.4 bn 1 Float : 25% LTM2Q17 Revenues 2 Countries Plants Routes Sales Centers POS Associates Brands Products US$13.7 Bn 24 175 ≈ 56,000 ≈ 1,700 ≈ 2.9 million ≈133 ,000 ≈100 ≈13,000 North America Latin America EAA China Mexico Mexico U.S. Canada ______________ 3 1. As of July 26, 2017. Expressed in US$ at the FX of $17.59 Ps./US 3 2. Converted to US$ with the average FX rate of that period
Successful Growth Story 2017 2016 Frozen Argentina 45+ acquisitions 2015 in the last 10 years 2014 2011 2009 00s 90s 80s 70s 50s 60s 1945 4 4
A WELL BALANCED BUSINESS WITH A STRONG LEADERSHIP POSITION IN EACH MARKET Canada Europe, Asia & Africa #1 in buns & rolls • #1 in bread & rolls in Spain • #1 in breakfast • #1 in bread in Portugal • #2 in bread • #1 in sweet baked goods in • Spain & Portugal United States #1 in bagels in the U.K. • Baking leader in New Delhi Leader nationwide • • and surroundings #1 in premium brands • Pioneer in developing • #1 in English muffins • packaged baked goods in Strong regional brands • Beijing and Tianjin Mexico #1 in packaged baked • goods #2 in cookies and crackers Developed • Emerging Latin America #2 in salty snacks markets • markets (1) #2 in confectionary #1 in packaged baked goods • • 58% in 15 countries 42% ______________ 5 Source: Nielsen, IRi and Company filings 1. In Mexican pesos. Includes India and Morocco sales figures announced on the 1Q17 report. Eliminations have been removed from Mexico’s results
OUR MISSION 6
SPACE TO GROW IN A VERY FRAGMENTED MARKET Global Bakery Landscape 2015 * 49 GB represents Artisanal 3.7% 8 from global Campbell market Private Label 6 40 Kellogg 8 Others Yildiz3 22 22 Mondelez 16 < Yamazaki4 3.7% 3 5 Grupo Bimbo 5% 1 1 Cakes Pastries Cookies Crackers TOTAL Bread Ranking Bimbo 1 1 1 16 - 1 Top 5 market share 8 % 7 % 12 % 24 % 39 % 10 % 7 ______________ Source BCG. Analysis * Breakfast cereals excluded. 7
LONG RUNWAY FOR GROWTH GLOBALLY THROUGH PENETRATION AND FREQUENCY • 11 th place • Household penetration: 6.4% Penetration (%) Household • Frequency : 13.2 8 ______________ 8 Source: KantarWorld Panel Brand Footprint 2016 - Food Category
OUR VISION 9 9
1 KEY CAPABILITIES 2 3 4 5 10 10
Seasoned Management Team and Sound Governance Management Positioned the Company as market leader in the categories and • countries with presence Daniel Servitje Chairman of the Board Proven track record of stability and sustainable growth • Successfully completed and integrated over 45 acquisitions over the • Audit Committee Results and Finance & last 10 years Evaluation Planning and Corporate Committee Committee Practices Governance (5 independent (5 members, (6 members, 1 independent) 1 independent) members) Corporate Governance aligned with shareholders’ interest • 35% of board members are independent • Daniel Servitje 3 corporate committees • CEO Social Responsibility Javier A. González Pablo Elizondo Gabino Gómez Executive VP of Executive VP of Executive VP of Named one of the “World’s most ethical companies in 2017 ” by the • Grupo Bimbo Grupo Bimbo Grupo Bimbo Ethisphere Institute Raúl Argüelles Reynaldo Reyna Guillermo Quiroz GB ranks among the most respected companies of the world 1 Chief HR and • Chief Global Services CFO 2 Corporate Affairs Reputation built on a strong corporate identity and brand equity • Fred Penny Miguel Ángel Espinoza Ricardo Padilla Key component of GB’s corporate identity is its company-wide Social • BBU President Bimbo President Barcel President Responsibility Program Raúl Obregón José Gabriel Calderón Complies with WHO’s Global Strategy on Diet and Physical Activity & • Chief Global Chief Global Auditing Health Transformation Officer _______________ 11 1. According to the Reputation Institute 11 2. Diego Gaxiola to assume role of CFO upon the retirement of Guillermo Quiroz on August 1 st , 2017
ENDURING MEANINGFUL BRANDS 5 Billion Dollar Brands 2 >$500 million dollar brands 12 12
ENDURING MEANINGFUL BRANDS 13 13
KEY CATEGORIES Packaged bread Solutions sliced bread, premium, buns & tortillas, pitas, wraps, pizza base, rolls, breakfast and frozen bread tostadas and totopos Sweet baked goods Prepackaged foods cakes and pastries Cookies Confectionary sweet cookies and crackers Salty snacks Other 14 14
A SAMPLE OF OUR PRODUCTS 15 15
UNIVERSAL PRESENCE WITH SUPERIOR EXECUTION 79+ Guarantees quality Exceptionally serves more Commitment to than 2.9 million points of local execution and freshness Trips around the Earth sale daily 16 16
Exceptional Manufacturing Capabilities 175 46+ Focus in low-cost million pieces are manufacturing and State-of-the-art facilities produced daily efficiency across our markets 17 17
Winning Innovation in Products and Processes We are developing products and categories in line with new megatrends 18 18 18
OUR CAPABILITIES ARE GROUNDED ON OUR COMMITMENT WITH SUSTAINABILITY Focusing on four pillars Not a department or integral to our strategy function, but rather a and overseen by the way of doing Sustainability Central business Committee This is how we reach our Vision, fulfill our Mission and meet our Purpose: To Build a Sustainable, Highly Productive and Deeply Humane Company 19 19
Strong Financial Performance Revenue Growth 1 Adj. EBITDA Growth 1 US$ millions US$ millions 14,064 1,570 1,517 1,467 13,818 13,786 1,370 1,351 13,706 1,070 13,514 13,164 2012 2013 2014 2015 2016 LTM 2Q17 2012 2013 2014 2015 2016 LTM 2Q17 GB 11.0% 8.1% 9.8% 9.8% 10.2% 11.1% Mexico 14.3% 13.8% 15.8% 16.7% 17.6% 18.6% North America 9.8% 7.3% 9.5% 6.4% 6.2% 8.3% Latin America 1.7% -1.1% 0.7% 3.9% 2.1% 0.8% EAA -18.6% -8.7% -3.8% -0.9% -4.4% -1.6% 20 ____________________ 20 1.Figures converted to USD using the 12M average FX rate for each year
Cash flow stability across time allows long term planning Margins Evolution % EBIT Margin Adj. EBITDA Margin Gross Margin 51.2 53.1 54.8 56.2 56.7 53.7 53.3 53.0 54.0 53.4 52.8 51.1 52.8 52.8 51.0 50.7 52.3 53.0 53.3 54.0 53.9 53.3 48.6 47.9 Integration/transformation efforts & IFRS 12.3 13.5 13.8 13.7 14.1 13.6 10.7 10.3 11.1 12.8 12.0 12.0 11.9 13.6 13.2 11.0 13.0 10.7 11.6 11.1 9.8 9.8 9.5 8.1 10.4 10.3 9.7 9.7 9.9 9.7 9.7 9.3 9.3 9.2 8.9 8.9 8.2 8.0 7.0 7.2 7.1 7.1 7.2 5.5 6.7 6.4 5.9 4.3 Best-in-Class execution combined with a relentless focus on low cost operation in a resilient industry results in financial stability over time 21 ____________ * Figures after 2011 in IFRS 21
Responsible Financial Policies Dividend History Commitment to a strong Balance Sheet • MXN millions Ongoing financial flexibility through a • Ordinary Dividends US$2 billion multi-currency revolving Extraordinary Dividends credit facility 1,646 1 Reinvestment as the pillar of the • 1,364 Company’s long term view 1,129 Conservative Risk Management policy • aligned with the Company’s strategy 706 647 776 Mitigate exposure to raw material 588 • 541 541 470 cost fluctuation Conservative approach towards FX • - and interest rate risks - 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 22 ____________ 1. Paid in advance for 2014 and 2015 22
Responsible Financial Policies Debt Amortization Profile 1 Currency Mix US$ millions % Total Debt: US$4,085 mm 3% Avg. Tenor: 7.8 yrs. 11% Avg. Cost: 4.7% 215 2 24% 62% 800 800 800 500 447 279 114 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 … 2044 USD CAD MXN EUR Local Bonds Bank Loans Foreign Bonds ____________ 1. Does not include debt at subsidiary level of US $141 mm, except for Bimbo Canada 23 2. Debt at Bimbo Canada level for the acquisitions of Vachon, IHB and Stonemill 23
RECENT ACQUISITIONS Producer of sweet baked goods and buns & rolls in Spain and Portugal Strong Revenue growth of ≈ 70% in the • Brand region Equity Synergies of €(40 – 50) million 1 • Integration expenses: ≈€70 • million High single digit pro-forma • EBITDA margin (1) ____________ 24 1. Expected to be achieved in 30 months after the closure of the acquisition 24
RECENT ACQUISITIONS Marroquin Company Producer of slow The baking leader in • • • specialized in baked crafted baked bread New Delhi and its surrounding areas goods in Toronto , Canada JV for 65% of stake Estimated anual sales: Estimated anual • • • Producer of packaged • US$ 11mm sales: • bread, pizza bases, and 3 Plants CAD$ 18mm • • sweet and savory buns More than 200 1 Plant • • Annual sales: US$ 48mm • associates Around 100 • 4 plants • associates More than 400 • associates 25 25
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