Sigma Foods, S.a.b. De C.v. · BMV:SIGMAF/A
Sigma Foods, S.a.b. De C.v — ALFA, S.A.B. de C.V. — Q4 2022 Earnings Presentation
31 slides from Sigma Foods, S.a.b. De C.v's earnings presentation, Feb 15, 2023
Slide 1: 4Q22 Earnings Presentation
4Q22 Earnings Presentation February 15, 2023 Confidential Information
Slide 2: Safe Harbor
Safe Harbor This presentation contains forward-looking information based on numerous variables and assumptions that are inherently uncertain. They involve judgments with respect to, among other things, future economic, competitive and financial market conditions and future business decisions, all of
Slide 3: Important note on changes to ALFA's Consolidated Financial Statements
Important note on changes to ALFA´s Consolidated Financial Statements ALFA’s shareholders approved to spin-off ALFA’s share ownership of Axtel into a new, listed entity called “Controladora Axtel” on July 12, 2022. In accordance with International Financial Reporting Standards (IFRS), Axtel meets th
Slide 4: 4Q22 Highlights
4Q22 Highlights • Record annual Revenue (+24% yoy) and EBITDA (+13% yoy) • 2022 results boosted by Alpek (Revenue +37% yoy; EBITDA +27% yoy; Comparable EBITDA +45% yoy) • Consolidated EBITDA below revised Guidance as macro conditions normalized after accelerated pace in previous quarters • 4Q22 EBIT
Slide 5: Record annual revenues boosted primarily by Alpek
Record annual revenues boosted primarily by Alpek Revenues Revenues 2022 vs 2021 (US $ Million) (US $ Million) 18,085 +24% 14,626 2021 2022 *Axtel reported as discontinued operations in all quarters. 5 Confidential Information
Slide 6: Revenue growth vs 4Q21 driven by Alpek and Sigma
Revenue growth vs 4Q21 driven by Alpek and Sigma; sequential decline due to lower prices and volume at Alpek ALFA & Subs* Revenues Revenues 4Q22 vs 4Q21 Revenues 4Q22 vs 3Q22 (US $ Million) (US $ Million) (US $ Million) 4,709 4,856 4,452 3,952 4,069 4Q21 1Q22 2Q22 3Q22 4Q22 Others Others *Axtel repo
Slide 7: Annual Reported and Comparable EBITDA up 13% and 22%
Annual Reported and Comparable EBITDA up 13% and 22% year-on-year, respectively, boosted by Alpek ALFA & Subs* Reported EBITDA Extraordinary Items Comparable EBITDA1 (US $ Million) (US $ Million) (US $ Million) 2022 vs 2021: 13% 2022 vs 2021 : 22% 2021 2022 ALPEK 183 60 SIGMA 2 - TOTAL 185 60 EBITDA
Slide 8: 4Q22 EBITDA includes impact of extraordinary items
4Q22 EBITDA includes impact of US -$84 million from extraordinary items; lower Comparable EBITDA due to declines in Alpek (-10%) and Sigma (-16%) ALFA & Subs* Reported EBITDA Extraordinary Items Comparable EBITDA (US $ Million) (US $ Million) (US $ Million) 4Q22 vs 4Q21: -26% 4Q22 vs 4Q21: -13% 4Q22
Slide 9: Reported and Comparable EBITDA
Reported and Comparable EBITDA Reported EBITDA* (US $ Million) 672 610 482 492 467 454 415 438 419 441 441 346 263 4Q19 1Q20 2Q20 3Q20 4Q20 1Q21 2Q21 3Q21 4Q21 1Q22 2Q22 3Q22 4Q22 Comparable EBITDA* (US $ Million) 534 572 496 487 393 396 430 362 344 334 365 364 371 4Q19 1Q20 2Q20 3Q20 4Q20 1Q21 2Q21
Slide 10: Net Debt/EBITDA of 2.3 times at the close of 4Q22
Net Debt/EBITDA of 2.3 times at the close of 4Q22 supported by strong EBITDA ALFA & Subs* ALFA Net Debt Net Leverage Ratio Cash (US $ Million) (Net Debt/EBITDA) (US $ Million) 1,506 5,406 1,417 4,906 4,830 2.3 2.3 2.3 2.3 1,291 1,272 4,677 4,751 2.2 1,155 4Q21 1Q22 2Q22 3Q22 4Q22 4Q21 1Q22 2Q22 3Q22
Slide 11: ALFA's Net Debt increased 2% yoy
ALFA’s Net Debt increased 2% yoy as record EBITDA and Discontinued Operations (Axtel) were offset by Alpek’s investments in Capex and NWC ALFA & Subs* Change in Net Debt Change in Net Debt 2022 vs 2021 (US $ Million) (US $ Million) 2022 +2% EBITDA 2,082 Net Working Capital (NWC) (486) Capital Expend
Slide 12: Sustained corporate expense reduction since 2019
Sustained corporate expense reduction since 2019 Consolidated ALFA EBITDA minus Operating subsidiaries1 (US $ Million) 2019 2020 2021 2022* -25 -42 -60 -71 -41% -65% 1 - Operating subsidiaries: Alpek, Sigma, Axtel and Newpek 12 *Axtel reported as discontinued operations in 2022 Confidential Informat
Slide 13: Axtel to become second independent ALFA subsidiary
Axtel to become second independent ALFA subsidiary Before spin-off After spin-off ALFA ALFA ALFA Shareholders Shareholders Shareholders Controladora ALFA ALFA Axtel2 100% 82% 53.9% 100% 82% 53.9% Sigma Alpek Axtel Nemak1 Sigma Alpek Axtel Nemak1 1. ALFA´s entire share ownership in Nemak was distribu
Slide 14: ALFA actively engaged with relevant parties to finalize Axtel spin-off process
ALFA actively engaged with relevant parties to finalize Axtel spin-off process June 27, July 12, TBD TBD TBD 2022 2022 Call to Extraordinary Extraordinary ALFA Share Distribution Controladora Axtel 1st Trading Day ALFA Shareholder Shareholder Meeting Notice to ALFA Share Distribution Meeting Shareho
Slide 15: Foreign ownership was 52.7% of total ALFA shares at the close of 4Q22
Foreign ownership was 52.7% of total ALFA shares at the close of 4Q22 ALFA Foreign Ownership (Millions of shares) 4,819 Total ALFA Shares 4Q22 Maximum Nafinsa Trust Threshold (75%) 2,513 2,572 2,516 2,515 2,538 51.2% 52.4% 51.9% 52.2% 52.7% 4Q21 1Q22 2Q22 3Q22 4Q22 15 Confidential Information
Slide 16: Earnings Presentation
Earnings Presentation Confidential Information
Slide 17: 4Q22 Highlights
4Q22 Highlights • Record annual and quarterly Revenue • Driven by double-digit growth in Mexico, the U.S. and Latam • 4Q22 EBITDA down 17% year-on-year • Primarily impacted by lower results in European operations 17 Confidential Information
Slide 18: Record annual revenues, up 9% year-on-year
Record annual revenues, up 9% year-on-year Revenues Revenues 2022 vs 2021 (US $ Million) (US $ Million) 7,425 6,817 +9% 2021 2022 18 Confidential Information
Slide 19: Record Quarterly revenue driven by growth in the Americas
Record Quarterly revenue driven by growth in the Americas Revenues Revenues 4Q22 vs 4Q21 Revenues 4Q22 vs 3Q22 (US $ Million) (US $ Million) (US $ Million) 1,964 1,870 1,879 1,768 1,711 4Q21 1Q22 2Q22 3Q22 4Q22 19 Confidential Information
Slide 20: Annual EBITDA primarily impacted by lower results in European operations
Annual EBITDA primarily impacted by lower results in European operations EBITDA EBITDA 2022 vs 2021 (US $ Million) (US $ Million) -12% 741 652 2021 2022 20 Confidential Information
Slide 21: 4Q22 Lower EBITDA due to inflationary cost pressures, mainly in Europe
4Q22 Lower EBITDA due to inflationary cost pressures, mainly in Europe EBITDA EBITDA 4Q22 vs 4Q21 EBITDA 4Q22 vs 3Q22 (US $ Million) (US $ Million) (US $ Million) 201 172 167 161 151 4Q21 1Q22 2Q22 3Q22 4Q22 21 Confidential Information
Slide 22: Annual EBITDA Margin contraction amid inflationary pressures
Annual EBITDA Margin contraction amid inflationary pressures EBITDA Margin (%) EBITDA Margin By Region (%) 2021 2022 14.6% 10.9% 12.4% 10.8% 10.5% 8.8% 10.0% 8.9% 6.5% 2.1% 2021 2022 Mexico Europe USA Latam 22 Confidential Information
Slide 23: 4Q22 EBITDA margin contraction due to inflationary cost pressures
4Q22 EBITDA margin contraction due to inflationary cost pressures EBITDA Margin (%) EBITDA Margin By Region (%) 15.0 15.2 14.6 13.7 13.1 13.0 13.2 12.4 12.7 11.0 11.0 11.2 11.2 11.4 10.8 10.5 10.7 10.5 10.2 9.5 9.5 9.4 9.2 9.1 9.0 8.7 8.1 8.5 8.0 9.3 8.5 6.6 7.8 5.4 4.9 2.3 2.5 2.0 1.6 1Q21 2Q21 3Q2
Slide 24: Net leverage ratio of 2.7 times; Long-term target of 2.5 times
Net leverage ratio of 2.7 times; Long-term target of 2.5 times Net Debt Net Leverage Ratio Cash (US $ Million) (Net Debt/EBITDA) (US $ Million) 1,795 1,772 1,782 2.7 1,691 1,708 2.5 2.5 2.5 820 2.3 698 676 699 683 4Q21 1Q22 2Q22 3Q22 4Q22 4Q21 1Q22 2Q22 3Q22 4Q22 4Q21 1Q22 2Q22 3Q22 4Q22 24 Confiden
Slide 25: Net debt increased during 2022 mainly due to lower EBITDA and higher CAPEX
Net debt increased during 2022 mainly due to lower EBITDA and higher CAPEX Change in Net Debt 2022 vs 2021 (US $ Million) • Net Debt increased by US $91 million when compared to 4Q21 • Net Working Capital investment was US $72 million mainly due to higher raw material costs, strategic purchases and
Slide 26: Pork Ham Price in U.S. and Europe
Pork Ham Price in U.S. and Europe Pork Ham Price in U.S. Pork Ham Price in Europe US $/lb 2020 €/kg 2020 2021 2021 2022 3.5 2022 1.2 3.0 1.0 2.5 0.8 2.0 0.6 1.5 0.4 1.0 0.2 0.5 0.0 0.0 Feb. Apr. Jun. Aug. Oct. Dec. Feb. Apr. Jun. Aug. Oct. Dec. 26 Confidential Information
Slide 27: 4Q22 Recent Developments
4Q22 Recent Developments Key Highlights • Tastech by Sigma • Launched the fourth edition of Tastech by Sigma on February 8th, 2023. Additional information can be found at: www.tastechbysigma.com • Growth BU • National launch of Sticks and Bites snacks at a large retailer in Mexico • Sustainability •
Slide 28: Record annual results; lower 4Q22 EBITDA amid normalization of favorable conditions
Record annual results; lower 4Q22 EBITDA amid normalization of favorable conditions Highlights Paraxylene vs Brent Crude Oil Price NA Px Contract Brent US$/Ton US$/Bbl Crude Oil (Brent) Px 1,837 2,000 140 1,800 120 1,505 1,600 • Record annual Revenue, EBITDA, Capex and Dividends supported 1,301 1,38
Slide 29: Jorge Young Cerecedo was appointed CEO of Alpek
Jorge Young Cerecedo was appointed CEO of Alpek; he has been with the Company for 32 years Current position • President of Alpek Polyester (66% of Alpek’s revenues) Previous Roles • Co-President of Alpek Polyester • President of PET and Staple Fibers • Executive VP at Alpek Polyester – PET resins •
Slide 30: 4Q22 EBITDA of US $41 million, up 4% quarter on quarter
4Q22 EBITDA of US $41 million, up 4% quarter on quarter Highlights EBITDA EBITDA by Business Unit (US $ Million) (LTM: US $150 million) • Sequential improvement in 4Q22 EBITDA Service Infrastructure (+4%) driven by growth in the Services business unit • Reduced net debt by US $37 million during 41 4
Slide 31: Contact
Contact Hernán F. Lozano V.P. of Investor Relations T. +52 (81) 8748-2521 iralfa@alfa.com.mx Confidential Information