2. Corporate Presentation | www.cencosud.com | 2
The information contained herein has been prepared by Cencosud S.A.
(“Cencosud”) solely for informational purposes and is not to be construed as a
solicitation or an offer to buy or sell any securities and should not be treated as
giving investment or other advice. No representation or warranty, either express
or implied, is provided in relation to the accuracy, completeness or reliability of
the information contained herein. Any opinions expressed in this presentation
are subject to change without notice and Cencosud is under no obligation to
update or keep current the information contained herein. The information
contained herein does not purport to be complete and is qualified in its entirety
by reference to more detailed information included in the preliminary offering
memorandum. Cencosud and its respective affiliates, agents, directors, partners
and employees accept no liability whatsoever for any loss or damage of any kind
arising out of the use of all or any part of this material.
This presentation may contain statements that are forward-looking subject to
risks and uncertainties and factors, which are based on current expectations and
projections about future events and trends that may affect Cencosud’s business.
You are cautioned that any such forward-looking statements are not guarantees
of future performance. Several factors may adversely affect the estimates and
assumptions on which these forward-looking statements are based, many of
which are beyond our control.
3. 3Corporate Presentation www.cencosud.com
Retailing Power
2015
936 Supermarkets; 2.4 mm sqm
53 Shopping Centers; 0.8 mm sqm
94 Home Improvement; 0.8 mm sqm
88 Department Stores; 0.4 mm sqm
Key Metrics
Revenue Evolution (USD Bn)
Cencosud snapshot
*
• Over 5.5 MM Cards Issued
• 148,700 Employees
• 800 MM Customers
• 4,394,604 sqm of Selling Space
• 1,117 Stores + 53 Malls
4.018 4.974
6.032
9.785 8.847 9.886
12.080
14.601
16.503 16.830 17.353
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
CAGR OF 15.8%
4. 4Corporate Presentation www.cencosud.com
Cencosud is a leading multi-format retailer in South America
Underpenetrated RegionRegional Footprint / Market Position
Source: ILACAD and US Census Bureau, figures as of December 2013
3rd Supermarkets
2nd Home Improvement
1st Supermarkets
4th Department Store
2nd Supermarkets
2nd Home Improvement
2nd Shopping Centers
2nd Department Stores
4th Supermarkets
Northeast Region (#2)
Minas Gerais (#1)
Rio de Janeiro (#3)
2nd Supermarkets
1st Home Improvement
2nd Shopping Centers
Source: Euromonitor
Sales Area Per Capita DYS (sqm/capita)
Sales Area Per Capita Food Retail (sqm/capita)
Sales Area Per Capita D-Stores (sqm/capita)
5. 5Corporate Presentation www.cencosud.com
Cencosud a Development and Growth Story
Source: ILACAD and US Census Bureau, figures as of December 2013
1: this number includes shopping centers
2. EBITDA is calculated as EBITDA minus revaluation of assets, indexation units and foreign exchange variations.
3: Net Financial Debt does not include debt related to Cencosud´s banking activities.
Acquisitions and Revenue
(USD Billion)
2.2
4.0
4.9
6.0
9.7
8.8
9.9
12.0
14.6
16.5
16.8
Colombia
1,170
3.6x
192%
180%
89%
LTM 20152009
10,873,515
663,218 17.4
2015
6. Corporate Presentation www.cencosud.com 6
The Cencosud Roadmap
Strategic Focus: Healthy
Organization, Focus on Consumer
The Business: Expense Control,
Competitiveness
Main Market Trends, Omni-Channel,
Loyalty Program, Brand Building
Consumer
Centric
Strong
Team
Focus
Efficiency &
Productivity
Sustainable
Brands
Growth &
Market Share
Bottom Line &
Cash
Generation
Loyalty
Programs
Competitive
Edge Private
Label with
Perceived
Value
Omni-Channel
Speeding up E-
Commerce
7. Corporate Presentation www.cencosud.com 7
High Income Brands Low Income Brands
Excellence in Perishables Imported Products Quality in Service
Promotional Pricing Quality on a Budget Proximity
8. Corporate Presentation | www.cencosud.com | 8
1Q15 Highlights
• Revenue expansion in all divisions mainly
fueled by Supermarkets and Home
Improvement.
• Department Stores SSS back to positive
territory with gross profit gains.
• Colombia continues to deliver positive
SSS in Food retail and Home
Improvement.
• Significant expansion of gross margin
drives Adj. EBITDA growth.
• Closed Scotiabank financial services
transaction.
9. 9
Food Retail and D-Stores
leading top line growth
• Robust SSS in Chile supermarkets.
• Santa Isabel repositioning gaining additional speed
• Stable gross margin with more efficient pricing strategy
• Declining traffic trend broken
• Further top line growth curbed by negative currency
swings in the COP and BRL.
• D-Stores bouncing back from 2014 lows.
• Positive SSS from Chile and Peru greenfield
• Gross margin recovery following improved
currency pass thru and better pricing
• Inventories in Check
Corporate Presentation | www.cencosud.com |
10. 10
Food Retail in Brazil
Undergoing High Competitive
Pressures
• Depreciation of BRL and soft demand lead to negative
SSS & revenue contraction from Brazilian supermarkets.
• SAP rollout yielding results in gross profit through better
performance management
• Focus on profitability: EBITDA generation at around 2%
according to guided by management.
• Management changes in Brazil laying ground to later
develop improved commercial strategy.
• Leaner operations; Additional SG&A curbs & COGs
management to come
Corporate Presentation | www.cencosud.com |
11. 11
Consolidated Revenue
Evolution
• Revenue gains across all division despite
unfavorable currency swings in Colombia and
Brazil.
• Positive SSS across all markets and businesses
except Brazil.
• Colombia Home Improvement recovering SSS
traction on better product mix and recovering
construction industry in Bogota area.
Consolidated Adjusted EBITDA
Evolution
• Ebitda expansion on Supermarket improvements
in Peru, Brazil and Argentina.
• Department Stores posting Ebitda expansion of
over 100% on improved Chile performance.
• Home Improvement booked a reduction in Ebitda
generation on new store openings across its
footprint, labor contingencies in Argentina and
migration to new product mix in Colombia.
.
FiguresinCLPmillion
Corporate Presentation | www.cencosud.com |
13. 13
Revenue Evolution
Adjusted EBITDA Evolution
• Positive SSS in Argentina and stable currency led top
line gains in the division.
• 13 Net Store Openings YoY or 1.6% selling space
Growth.
• Chile recorded outstanding 1Q15 SSS performance
on recovering Santa Isabel.
• Price investment strategy in Peru continues to yield
SSS gains.
• Aggressive competitive scenario in Brazil and
slowing economy lead to negative SSS.
FiguresinCLPmillion
SSS evolution by country
(local currency)
Supermarkets
• Peru Ebitda jumped 85.7% on expanding gross
margin and curbed SG&A.
• Brazil Ebitda growth was fueled by expanding gross
margin and SG&A cuts.
• Ebitda in Argentina posts expansion of 7.4% on
positive SSS and stable gross margin.
• Chile and Colombia posted lower Ebitda generation
on labor contingencies in Chile and higher
headcount in Colombia. Colombia margins remained
stable
303
813
Corporate Presentation | www.cencosud.com |
14. 14
FiguresinCLPmillion
Home Improvement
• Revenue up 19% on positive SSS across all
markets led by Argentina.
• Ebitda for division dropped on greater SG&A
from Argentina on labor contingencies and
accounting changes at Blaisten, collective
bargaining agreements and one off in Chile.
• Colombia continues to improve performance.
Department Stores
• Gains in revenue on positive SSS in Chile and Peru.
• Progress in EBITDA on improved pricing and currency
management.
• Improved inventory management leading to reduced
working capital needs.
34.143
Corporate Presentation | www.cencosud.com |
15. 15
FiguresinCLPmillion
Shopping Centers
• Revenue growth in all markets; Chile mainly
explained by retroactive lease collection for
antenna space and renegotiation of lease
agreements with Ripley.
• Shopping Center EBITDA contracted to higher
real estate taxes paid in Chile and Argentina
partially offset by higher occupancy rates in
Chile, Argentina & Peru.
Financial Services
• Argentina and Peru lead in top line growth on greater
portfolio.
• Lower risk in Brazil explains greater contribution to
revenues and Ebitda.
• Lower EBITDA in most markets was the result of
higher cost of funding
40.243
- 4.6%
- 21.1%
36.173
28.542
Corporate Presentation | www.cencosud.com |
16. 16
Effective Tax Rate
• Chile
• Higher income tax rate of 22.5% vs. 20% in 1Q14
• Non- Cash effect of un-claimable tax losses at a HoldCo level of CLP
4,217 million (FUT effect)
• Brazil:
• Badwill due to corporate reorganization
• Non-Cash unrecoverable Tax Losses at our Brazilian Sub
• Total Effect of CLP 6,559 million
• Colombia
• Higher income tax rate of 39% vs. 34% in 1Q14
• Newly created wealth tax (non-deductible tax expense) as a one time
effect in the 1Q15 for the next 2 years
• Accelerated depreciation of tax goodwill Higher income tax in Colombia
due to tax reform
• Total effect of CLP 4,010 million
Conciliation
Corporate Presentation | www.cencosud.com |
17. 17
Financial Ratios
Cencosud estimates it can bring down its net financial leverage to under 3.0x by
YE15
Net debt evolution
(US$ bn)
Net leverage
(net debt / EBITDA)
Breakdown by Rate
(After CCS)
Breakdown by
Currency
(After CCS)
Corporate Presentation | www.cencosud.com |
CLP
CLF
USD
BRL
COP
PEN
ARS
Fixed
Variable
18. Corporate Presentation | www.cencosud.com | 18
Debt Amortization Schedule (USD million) as of March 2015
Chile Financial Services deal with Scotiabank materialized on
May 1st 2015.
Following reception of funds our liquidity position also
improves substantially.
FINANCIAL DEBT
USD MM
Amortizations as of
March 2015
Amortizations
Proforma as of
March 2015
19. Chile food strategy yields
above inflation SSS.
Positive momentum in
revenue across most division
D-Stores recovering with
some weak spots in April due
to weather related factors.
Leverage down closer to
target as of 2Q15.
Progress on Real Estate IPO
and Costanera Center.
20. First Quarter | www.cencosud.com | 20
Upcoming Events
Bank of America CalGems
Conference
Los Angeles, CA
June 2 thru 4
Credit Suisse Annual Mid
Summer Latam Conference
New York, NY
Aug 5 & 6
2Q15 Earnings Release
August 28, 2015
After market
Marisol Fernández León
IR Manager
Phone +562 2959 0545
mariasoledad.fernandez@cencosud.cl
Natalia Nacif
Senior IR Analyst
Phone +562 2959 0368
natalia.nacif@cencosud.cl
Ignacio Reyes Miranda
Senior IR Analyst
Phone +562 2959 0804
Ignacio.reyesmiranda@cencosud.cl
