SSB Institutional Mar2014_EN

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SSB Institutional Mar2014_EN

  1. 1. Company Presentation March 2014
  2. 2. Disclaimer ► The material that follows is a presentation of general background information about Sonae Sierra Brasil S.A. and its subsidiaries (the “Company”) as of the date of the presentation. It is information in summary form and does not purport to be complete. It is not intended to be relied upon as advice to potential investors and does not form the basis for an informed investment decision. This presentation is strictly confidential and may not be disclosed to any other person. No representation or warranty, express or implied, is made concerning, and no reliance should be placed on, the accuracy, fairness or completeness of the information presented herein. ► This presentation may contain statements that are forward-looking within the meaning of Section 27A of the U.S. Securities Act of 1933, as amended (the “Securities Act”) and Section 21E of the U.S. Securities Exchange Act of 1934. Such forward-looking statements are only predictions and are not guarantees of future performance. Investors are cautioned that any such forward-looking statements are and will be, as the case may be, subject to many risks, uncertainties and factors relating to the operations and business environments of the Company and its subsidiaries that may cause the actual results of the Company to be materially different from any future results expressed or implied in such forward-looking statements. No person has any responsibility to update any such information. ► This presentation does not constitute an offer, or invitation, or solicitation or an offer, to subscribe for or purchase any securities. Neither this presentation nor anything contained herein shall form the basis of any contract or commitment. 2
  3. 3. Parque D. Pedro Shopping Shopping MetrópoleManauara Shopping Uberlândia Shopping
  4. 4. Index 4 4 Company Fundamentals 9 Our Portfolio 28 Appendix - Market and Sector Fundamentals 12 Operational and Financial Indicators 22 Case Studies
  5. 5. • Leverage on the expertise, tenant relationships and market recognition of our majority shareholders • Controlling shareholders with significant experience in the sector • 33.4% free float • Roughly 90% of leases are fixed, providing significant foreseeability • Lowest common charge in the sector, as a result of malls’ formats and Company’s efficiency • Centralized back office structure • Prudent leverage and cash management • 10 shopping centers owned and managed (450k sqm total GLA) • Occupancy rate of 97.2%(1) • Best-in-class margins (Adj. EBITDA = 75.0% and Adj. FFO = 53.6%) • Greenfield Expertise (84% of GLA) • 2 third-party managed malls 5 Operating Expertise Strong Shareholders Base Competitive Advantages • Parque D. Pedro Shopping is our main asset, with 121 thousand sqm of GLA (Gross Leaseble Area) is one of the largest shopping malls in Brazil and Latin America • The mall is located in the city of Campinas, in the São Paulo State, 100 km from the city of São Paulo • Sonae Sierra Brasil holds a 51% ownership interest in this mall Sonae Sierra Brasil at a glance One of the leading developers, owners and operators of top quality and regionally dominant shopping centers in Brazil (1) Excluding Uberlândia, Boulevard Londrina and Passeio das Águas shopping centers
  6. 6. 24.6 24.6 25.1 79.9 80.8 102.7 108.4 128.4 150.0 148.5 200.0 203.7 208.5 231.3 353.7 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 21.0% CAGR 2012 2013 Pátio Brasil Expansion PDP Shopping Boavista Opening Acquisition of an additional 20% ownership interest in Plaza Sul Acquisition of 50% of Sonae Sierra’s ownership interest in SSB Brasil by DDR Campo Limpo Opening Manauara Opening PDP Expansion Campo Limpo and Metrópole Expansion Acquisition of an additional 17% ownership interest in Metrópole Swap - Acquisition of an additional 30.0% ownership interest in Plaza Sul / Sale of 22.2% in Penha Uberlândia Opening Londrina Opening Goiânia Opening Acquisition of an additonal ownership interest in Metrópole, Plaza Sul and Tivoli Acquisition of an additonal 9.5% ownership interest in Franca Sale of 51.0% ownership interest in Penha; 30.0% in Tivoli; 10.4% in Pátio Brasil Sonae Sierra enters the Brazilian shopping center market, creating a joint-venture with Enplanta Engenharia: Sonae Enplanta Portfolio Timeline 6
  7. 7. 8.0 15.6 15.2 17.8 10.7 12.3 SSB BRMalls Multiplan Iguatemi Aliansce General Shopping 176.0 138.2 173.0 99.6 124.8 48.5 SSB BR Malls Multiplan Aliansce Iguatemi General Shopping Development Capabilities 7 48.6% of GLA is less than 5 years old Owned GLA developed in the last 3 years Average Age of Malls (owned GLA weighted) SSB has been the leading developer and owns the newest portfolio among listed peers
  8. 8. Ownership Structure Free Float Sierra Brazil 1 B.V. 66.65% 33.35% 50.0% • Over 45 years of history • One of the largest developers and operators of shopping centers in US • 12 million of sqm in total GLA • NYSE listed and Sox Compliant • Market value of US$5.9 billion(1) 50.0% • Over 21 years of history • One of the largest developers and operators of shopping centers in Europe • Over 2 million of sqm in total GLA • NAV: €1.0 billion(1) • The largest business group of Portugal, with operations in over 40 countries • Operations in retail, properties, shopping centers and telecommunications • Market value: €2.6 billion(1) • British company with over 300 years of history in the properties market • Over 1,000 properties under management with a total value of £10.9 billion • Properties in retail, commercial and residential segments Sonae Sierra Brasil S.A. 50.0%50.0% On March 10, 2014 DDR announced that it reached an agreement to sell its investment in Sierra Brazil 1 B.V. and PDP 1 B.V. for US$ 344 million to Alexander Otto and his affiliates Note: (1) As of March 2014 Source: Reuters, Sonae Sierra 8
  9. 9. Index 9 4 Company Fundamentals 9 Our Portfolio 28 Appendix - Market and Sector Fundamentals 12 Operational and Financial Indicators 22 Case Studies
  10. 10. Portfolio 10 Our portfolio is composed of 10 operating shopping malls, totaling 2,150 stores, 450 thousand sqm of total GLA and 354 thousand sqm of owned GLA. We recently opened Passeio das Águas Shopping, our 10th mall, which added 78 thousand sqm of owned GLA to the portfolio. The Company also manages 2 third party malls totaling 341 stores and 52 thousand sqm of GLA. 3 1 5 62 4 8 10 9 7 1. Parque D. Pedro Shopping • Campinas (SP) • GLA tsd sqm: 121.3 • Stores: 400 2. Boavista Shopping • São Paulo (SP) • GLA tsd sqm: 15.9 • Stores: 146 3. Franca Shopping • Franca (SP) • GLA tsd sqm: 18.5 • Stores: 106 5. Shopping Plaza Sul • São Paulo (SP) • GLA tsd sqm: 23.4 • Stores: 221 6. Shopping Campo Limpo • São Paulo (SP) • GLA tsd sqm: 22.3 • Stores: 149 4. Shopping Metrópole • São Bernardo do Campo (SP) • GLA tsd sqm: 30.0 • Stores: 191 7. Manauara Shopping • Manaus (AM) • GLA tsd sqm: 46.5 • Stores: 233 9. Boulevard Londrina Shopping • Londrina (PR) • GLA tsd sqm: 48.4 • Stores: 221 10. Passeio das Águas Shopping • Goiânia (GO) • GLA tsd sqm: 77.9 • Stores: 259 8. Uberlândia Shopping • Uberlândia (MG) • GLA tsd sqm: 45.8 • Stores: 215 12. Tivoli Shopping • Sta. Bárbara d’Oeste (SP) • GLA tsd sqm: 22.1 • Stores: 146 11 Malls in operation Third party managed malls 11. Shopping Penha • São Paulo (SP) • GLA tsd sqm: 29.7 • Stores: 195 12
  11. 11. Controlling interests in most of shopping centers 11 Sonae Sierra Brasil‟s average ownership stake is 78.6% in its 10 operating properties. Note: (1) Sonae Sierra and DDR hold an additional 25.9% indirect ownership in Parque D. Pedro through another structure. Rationale Ability to expand and adapt to market trends Controls the management services of 100% of owned malls Strategic control of the malls Shopping Center City State GLA („000 sqm) % SSB Management Parque D. Pedro(1) Campinas SP 121.3 51.0%  Metrópole São Bernardo do Campo SP 30.0 100.0%  Boavista São Paulo SP 15.9 100.0%  Franca Franca SP 18.6 76.9%  Plaza Sul São Paulo SP 23.4 60.0%  Campo Limpo São Paulo SP 22.3 20.0%  Manauara Manaus AM 46.5 100.0%  Uberlândia Uberlândia MG 45.8 100.0%  Boulevard Londrina Londrina PR 48.4 88.6%  Passeio das Águas Goiânia GO 77.9 100.0%  Average 78.6% Third party malls under management Penha São Paulo SP 29.7  Tivoli Santa Bárbara d’Oeste SP 22.1 
  12. 12. Index 12 4 Company Fundamentals 9 Our Portfolio 28 Appendix - Market and Sector Fundamentals 12 Operational and Financial Indicators 22 Case Studies
  13. 13. Shopping Center Sales 13Data as of 4Q13 988 1,117 1,285 3,101 3,614 4,013 4Q11 4Q12 4Q13 2011 2012 2013 Shopping Center Tenant Sales (R$ million) 15.1% 11.0% 733 868 971 2,114 2,498 2,727 3Q11 3Q12 3Q13 9M11 9M12 9M13 Shopping Center Tenant Sales (R$ million) 11.9% 9.2% Shopping Center Tenant Sales (R$ thousand) Shopping Metrópole 108,196 105,027 3.0% 353,921 346,283 2.2% Franca Shopping 60,760 55,317 9.8% 197,776 175,368 12.8% Parque D. Pedro Shopping 406,005 375,936 8.0% 1,312,755 1,286,028 2.1% Boavista Shopping 78,238 73,783 6.0% 264,358 252,545 4.7% Shopping Plaza Sul 136,013 125,074 8.7% 424,250 399,127 6.3% Shopping Campo Limpo 104,226 95,698 8.9% 328,403 298,189 10.1% Manauara Shopping(1) 223,804 222,818 0.4% 728,451 673,699 8.1% Uberlândia Shopping 75,457 63,030 19.7% 249,805 183,237 36.3% Boulevard Londrina Shopping 55,927 - N/A 116,382 - N/A Passeio das Águas Shopping 36,614 - N/A 36,614 - N/A Total 1,285,241 1,116,684 15.1% 4,012,716 3,614,477 11.0% 4Q13 4Q12 Δ 2013 2012 Δ
  14. 14. 14 Same Store Sales (SSS) Same Store Rent (SSR) Operating Performance Data as of 4Q13 9.1% 9.8% 9.8% 7.3% 7.9% 9.8% 9.2% 7.9% 6.4% 6.1% 4.4% 7.0% 7.9% 4Q10 1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 9.5% 11.1% 12.7% 13.0% 12.7% 12.1% 13.1% 9.7% 11.7% 11.8% 10.8% 12.8% 10.8% 4Q10 1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13
  15. 15. Operating Performance 15Data as of 4Q13 98.8% 98.5% 97.4% 97.7% 97.4% 97.2% 94.7% 95.1% 93.7% 97.2% 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 4Q13 w/o New Malls* Occupancy (% GLA) Occupancy (% GLA) Occupancy Cost (%) 2.92% 2.11% 2.61% 2.86% 2.75% 2.38% 3.08% 2.96% 3.09% 2.91% 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 3Q13 w/o Uberlândia and Londrina Delinquency Rate (25 days) 8.7% 9.1% 9.2% 9.2% 9.1% 9.3% 9.3% 9.4% 9.3% 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 Occupancy Cost (%) 2.11% 2.61% 2.86% 2.75% 2.38% 3.08% 2.96% 3.09% 3.05% 2.61% 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 4Q13 w/o New Malls* Delinquency Rate (25 days) * Uberlândia, Londrina and Passeio das Águas Shopping Centers * Uberlândia, Londrina and Passeio das Águas Shopping Centers
  16. 16. Revenue Breakdown 16Data as of 4Q13 77% 1% 7% 9% 5% 1% Gross Revenue Breakdown in the quarter Rent Rent contract straight-lining Service revenue Parking revenue Key Money Other revenue Revenues (R$ million) 4Q13 4Q12 Δ 2013 2012 Δ Rent 71.4 63.6 12.2% 241.5 221.8 8.9% Rent contract straight-lining (0.5) (0.5) -2.9% 2.0 2.6 -23.5% Service revenue 5.8 5.0 16.5% 20.2 17.8 13.7% Parking revenue 7.9 7.2 9.1% 27.9 26.5 5.5% Key Money 4.7 3.0 56.1% 19.0 12.1 57.4% Other revenue 1.8 0.7 166.8% 5.2 2.8 86.7% Total Gross Revenue 91.1 79.0 15.3% 315.8 283.4 11.4% 78% 6% 9% 5% 2% Gross Revenue Breakdown in the quarter Rent Service revenue Parking revenue Key Money Other revenue 77% 13% 10% Fixed Rent Revenue Turnover Rent Revenue Kiosks and Merchandising
  17. 17. Costs and Expenses 17Data as of 4Q13 Cost and Expenses (R$ million) 11.6 18.3 43.2 58.7 4.1 5.1 20.0 22.3 4Q12 4Q13 2012 2013 Cost and Expenses (R$ million) Cost of rentals and services Operating expenses 57.5% 36.0%25.2% 11.4% Costs and Expenses (R$ million) 4Q13 4Q12 Δ 2013 2012 Δ Depreciation and amortization 0.6 0.5 13.2% 2.3 1.8 30.2% Personnel 8.0 7.1 12.2% 31.7 28.7 10.5% External services 2.6 2.8 -4.8% 11.4 10.5 8.9% Occupancy expense (vacant stores) 5.7 1.8 215.1% 14.5 6.1 137.3% Cost of contractual agreements with tenants 2.6 0.7 269.2% 6.3 2.2 183.9% Provision for bad debts 0.1 - N/A 2.8 2.4 16.3% Rent 0.6 0.5 15.5% 2.8 2.6 7.2% Other 3.2 2.3 38.0% 9.2 8.9 3.2% Total 23.4 15.7 49.1% 81.0 63.2 28.2%
  18. 18. Financial Performance 18Data as of 4Q13 57.4 57.8 199.3 206.9 81.3% 73.8% 77.6% 75.0% -1050.0% -850.0% -650.0% -450.0% -250.0% -50.0% 0.0 50.0 100.0 150.0 200.0 250.0 300.0 4Q12 4Q13 2012 2013 3.8% 0.6% 40.4 38.3 155.6 147.9 57.2% 48.9% 60.6% 53.6% 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 0.0 50.0 100.0 150.0 200.0 250.0 4Q12 4Q13 2012 2013 -5.3% -5.0% 69.5 75.0 251.2 268.5 4Q12 4Q13 2012 2013 7.9% 6.9% Adjusted EBITDA (R$ million) and Margin Adjusted FFO (R$ million) and Margin Net Revenue (R$ million) NOI (R$ million) 70.7 78.3 256.9 275.8 4Q12 4Q13 2012 2013 Net Revenue (R$ million) 10.8% 7.4%
  19. 19. Financial Performance (51% PDP) 19Data as of 4Q13 27.6 24.2 110.5 97.9 47.8% 37.9% 53.2% 43.8% -40.0% -30.0% -20.0% -10.0% 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% 0.0 50.0 100.0 150.0 200.0 4Q12 4Q13 2012 2013 -12.3% -11.4% 57.7 63.9 207.9 223.7 4Q12 4Q13 2012 2013 Net Revenue (R$ million) 10.7% 7.6% 44.7 44.0 154.9 157.8 77.5% 68.8% 74.5% 70.5% -98.0% -48.0% 2.0% 52.0% -20.0 30.0 80.0 130.0 180.0 230.0 280.0 4Q12 4Q13 2012 2013 Adjusted EBITDA(R$ million) and Margin 1.8% -1.7% Adjusted EBITDA (R$ million) and Margin Adjusted FFO (R$ million) and Margin Net Revenue (R$ million) Net Income (R$ million) 28.1 74.6 185.5 226.0 4Q12 4Q13 2012 2013 Net Income (R$ million) 21.8% 165.2%
  20. 20. Cash Position and Leverage 20 2.3x Net Debt/EBITDA Contracted Debt Financing Committed Amount (R$ MM) Term (years) Interest Rate(1) Balance as of 12/31/13 (R$ million) Working Capital 20 5 CDI + 1.66% 8 Working Capital 27 6 CDI + 1.78% 14 Manauara Shopping 112 12 8.50% 120 Metrópole Shopping - Expansion I 53 8 TR + 9.30% 43 Uberlândia Shopping 81 15 TR + 9.70% 73 Boulevard Londrina Shopping 120 15 TR + 9.70% 118 Passeio das Águas Shopping 200 12 TR + 9.70% 197 Debentures - 1st series 96 5 CDI + 0.96% 98 Debentures - 2nd series(2) 205 7 IPCA + 6.25% 236 Total 913 905 Weighted Average 10.2 10.4% (1) Considering TR at 0.19% p.a., CDI at 9.8% p.a. and IPCA at 5.91% as of December 31, 2013 (2) The Company contracted in August 2013 a derivative instrument (swap) of R$ 54.5 million at a rate of CDI + 1.24% Fixed 13% CDI 13% TR 48% IPCA 26% Debt Profile 828.6 480.2 76.1 424.4 Total Debt Cash and cash equivalents Net Debt Net Financial Debt (R$ million) Short Term Long Term 904.7 886.5 419.2 467.3 Total Debt Cash and cash equivalents Net Debt Net Financial Debt (R$ million) Fixed 14% CDI 13% TR 47% IPCA 26% Debt Profile 24.6 74.5 66.6 109.8 106.1 504.8 2013 2014 2015 2016 2017 2018 and beyond Financial Debt Amortization (R$ million) Does not consider debt related to asset acquisitions 76.1 65.7 109.0 105.2 170.7 377.9 2014 2015 2016 2017 2018 2019 and beyond Financial Debt Amortization (R$ million) Does not include debt related to asset acquisitions Data on 12/31/13
  21. 21. Leverage Strategy  Financing through bank loans up to 50% of the total cost for each project  Debt indexation linked to Sonae Sierra Brasil’s assets  Amortization schedule highly manageable  No exposure to foreign currencies  Management of cash and financial leverage indexes (restricted to 3.25 of Net Debt/ EBITDA in 2014) 21
  22. 22. Share Performance and Trading Multiples 22 Share Price Performance Trading Multiples • Maximum: R$ 34.34 in October 2012 • The stock is trading below R$5,000/GLA • Gross investments for Passeio das Águas Shopping ~ R$ 6,200/GLA - 5.00 10.00 15.00 20.00 25.00 30.00 35.00 40.00 SSBR3 Price (R$) Price (R$) Market Cap (R$ MM) EV (R$ MM) P/FFO 14 EV/EBITDA 14 EV/GLA BR Malls 17.96 8,209 12,516 12.3x 9.6x 13,172 Multiplan 46.10 8,212 10,064 14.6x 11.3x 18,854 Iguatemi 21.38 3,776 4,385 14.4x 10.7x 15,641 Aliansce 17.66 2,808 4,504 12.8x 11.0x 11,262 Average: 13.5x 10.7x 14,732 SSB 15.66 1,197 1,677 7.1x 6.0x 4,738 SSBR3 discount to peers: 47% 44% 68% Price as of 02/28/14; EV and FFO estimates based on Bloomberg consensus Source: Companies reports; Bloomberg
  23. 23. Index 23 4 Company Fundamentals 9 Our Portfolio 28 Appendix - Market and Sector Fundamentals 12 Operational and Financial Indicators 22 Case Studies
  24. 24. Case Study – Parque D. Pedro Refurbishment and Innovation 24 Refurbishment of movie theater, adding 2 VIPs screens and the first IMAX theater in the region Refurbishment of aisle currently dedicated to furniture stores and fitness center Coverage of Alameda Parque D. Pedro (PDP first expansion) New dining area and new entrance 13,757 sqm area leased to a convention center operator Even though Parque D. Pedro is one of the most prominent shopping centers in Brazil, we continue to refurbish and renovate the mall to perpetuate its dominant position in the region
  25. 25. Case Study – Boulevard Londrina New Development Shopping Center Data City Londrina State Paraná Opening May 2013 GLA (Ꞌ000 sqm) 48.4 SSB stake 88.6% Number of stores 221 Anchor stores 10 Cinema screens 7 Parking spaces 2,400 Occupancy rate 88.6% Boulevard Londrina Shopping has a privileged location, in the city‟s downtown and is part of an imposing mixed-use project Boulevard Londrina Shopping gathers a tenant mix of diversified stores, with high appeal to the public 25
  26. 26. Case Study – Passeio das Águas New Development Shopping Center Data City Goiânia State Goiás Opening October 2013 GLA (Ꞌ000 sqm) 77.9 SSB stake 100% Number of stores 259 Anchor stores 17 Cinema screens 7 Parking spaces 4,000 Occupancy rate 83.4% Passeio das Águas Shopping is the second largest shopping of Sonae Sierra Brasil and the largest mall in Brazil‟s Mid-West region Passeio das Águas Shopping has a diversified tenant mix, with renowned brands 26
  27. 27. Case Study – Franca Shopping Expansion 27 Site Location Internal Rendering External Rendering 45,500 sqm area; 11,700 sqm of GLA of expansion After announcing the acquisition of a 45,500 sqm land plot adjacent to the Franca Shopping aiming an expansion of 11,700 sqm of GLA, the Company officially launched the project in a ceremony that took place in Franca on March 18th, comprising the expansion above-mentioned plus a full revitalization in the existing mall. Expansion Features Opening 1H15 Expansion GLA (Ꞌ000 sqm) 11.7 Satellite stores 63 Anchor stores 6 Gross Investment (R$ MM) 96.7 Revitalization Features  Façade painting with “lake, garden and birds” elements and graphite decoration  Lake area will be covered and will have new stores  Movie theater: modernization and 2 new screens to be built-up  New ceiling and covering of open air areas for the air-conditioning system  New furniture and internal signs Expansion and Revitalization
  28. 28. Case Study – Plaza Sul Value creation through M&A and turnaround Shopping Center Highlights  SSB ownership increasing from 20% (2005 – acquisition) to 60% (2012)  Occupancy rate improvement: from 80% (2005) to 99% (2013)  Asset appreciation of 3.5x its purchase price (R$ 96 million) since 2005  Tenant Mix improvement with renowned tenants: Starbucks, Samsung, Lacoste, MyStore Performance Highlights(1) Sales (% Y-o-Y) 8.7% SSR (sqm/month) 11.6% Occupancy Rate (%GLA) 99.1% (1) Data as at 4Q13 New FaçadeOld Façade 28
  29. 29. Index 29 4 Company Fundamentals 9 Our Portfolio 28 Appendix - Market and Sector Fundamentals 12 Operational and Financial Indicators 22 Case Studies
  30. 30. Fast growing middle class 30 Over 40 million people have moved upwards into the middle class, while middle class disposable income has tripled Increasing middle class Middle class: disposable income(1) (R$/month) Consumer credit still underpenetrated in Brazil Source: Cetelem “O Observador 2012” 51% 24% 34% 54% 22% 15% 2005 2011 Population: 182 mm Population: 191 mm +16 mm people +40 mm people A+B C D+E UpperclassMiddleclassLowerclass - 48 mm people R$ 30 billion increase in monthly disposable income Note: (1) Income available for spending and savings Source: Cetelem “O Observador 2012”, Euromonitor and Raymond James Sonae Sierra Brasil is strategically positioned to capture the middle class consumption growth, as it entails over 80% of its target audience 122 363 2005 2011 25% 26% 16% 15% 11% 6% 4% 28% 26% 16% 14% 10% 10% 4% Chile USA Spain Germany Argentina Brazil Mexico 2006 2011
  31. 31. 31.7 35.9 41.6 45.5 50.0 58.0 64.6 74.0 91.0 108.0 121.0 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 CAGR 2002-2012: 14.3% Source: ABRASCE; SSB 5.5 5.6 6.2 6.3 7.5 8.3 8.6 9.1 9.5 10.3 11.2 0 .0 2 .0 4 .0 6 .0 8 .0 1 0 .0 1 2 .0 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 CAGR 2002-2012: 7.4% Source: ABRASCE; SSB 303 317 326 335 351 363 376 392 408 430 457 0 5 0 1 0 0 1 5 0 2 0 0 2 5 0 3 0 0 3 5 0 4 0 0 4 5 0 5 0 0 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 CAGR 2002-2012: 4.2% Source: ABRASCE; SSB - 500 1,000 1,500 2,000 2,500 USA Canada Europe Chile Mexico Colombia Peru Brazil DF SP PR AM GO MG GLA/1,000 inhabitants (2011) Brazilian shopping center industry fundamentals 31 The Brazilian mall industry had a significant growth in recent years but it is still significantly underpenetrated when compared to other countries Number of shopping centers in Brazil GLA (million sqm) Low shopping center market penetration Source: ABRASCE, IBGE, BTG, SSB. Brazil Average: 58 Shopping Center Sales (R$ billion)
  32. 32. Brazilian shopping center industry fundamentals (cont‟d) According to Abrasce, 40 greenfield projects were announced for 2014 in Brazil, which, if concluded, should add more than 1.2 million sqm of GLA Source: Abrasce (January 2014) 32 North • Malls: 5 • GLA: 159k sqm Mid-West • Malls: 2 • GLA: 50k sqm Northeast • Malls: 7 • GLA: 209k sqm Southeast • Malls: 22 • GLA: 669k sqm South • Malls: 4 • GLA: 93k sqm Brazil • Malls: 40 • GLA: 1,180k sqm
  33. 33. Thank you! Investor Relations Website: www.sonaesierrabrasil.com.br/ir Email: ribrasil@sonaesierra.com Phone: +55 (11) 3371 3692

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