Sonae Sgps Sa · EURONEXT:SON
Sonae Sgps Sa — Sonae — Investor Presentation (September 2017)
42 slides from Sonae Sgps Sa's investor presentation, September 2017
Slide 1: Investor Presentation September 2017
INVESTOR PRESENTATION September 2017
Slide 2: Profile
SONAE HOLDING Profile At SONAE, each day is a new beginning for new opportunities, new challenges and new triumphs SPRIAS
Slide 3: Our Mission and Our Way
O1.Profile OUR MISSION AND OUR WAY SONAE AND CAPITAL MARKETS OUR MISSION To create long-term economic and social value, taking the benefits of progress and innovation to an ever-increasing number of people OUR WAY We are a multinational group with solid roots anda constant drive towards progress. Ou
Slide 4: Our Values
O1.Profile OUR VALUES TRUST AND INTEGRITY We are committed to creating economic value in the long term, built on sustainable relationships with all our stakeholders. We establish these relationships based on principles of honesty, uprightness and transparency PEOPLE AT THE CENTRE OF OUR SUCCESS Our
Slide 5: History
O1.Profile HISTORY 50's to 70's 80's 90's Capital Markets M&A /Disposals Openings Holding Operations + Launch of Sonae in the Capital Markets (1983) +7 IPOs for: Particleboard, Food Retail, Tourism, Media, Robotics, Shopping Centres, electricity and cooling (1987) one Wa + Acquisition of STAR (trave
Slide 6: History
O1.Profile HISTORY 00's 2007 to2009 10's @ Capital Markets M&A /Disposals Openings Holding Operations + Sonae Sierra delisting (2001 + Spin-off of Sonae Industria (ee 005) + Sonaecom takeover bid for and PT Multimédia (2006) sha tospn Boatman MDS (insurance company) and Cooper Gay (insurance broker)
Slide 7: History
O1.Profile “A ~ HISTORY 2013 come 2015 and 2014 to2017 | OLOSAN X . + Sonaecom launches a tender offer for the acquisition of a Capital maximum of 24.16% of its share capital. The level of Markets acceptance reaches 62%, corresponding to aprox. 55 million Salsa Sonaecom shares (2014) + Merger betwee
Slide 8: Group Portfolio of Businesses with Leading Positions in Each Sector
O1.Profile GROUP PORTFOLIO OF BUSINESSES WITH LEADING POSITIONS STRUCTURE INEACH SECTOR SPRIAS SIVLESAGE @corome conmneme COMET Zone @ © S2tece 3k = Cet EaT qe Ded NI Ss 4 of -— veces Beaso Os hws vows Ee =. a =, ALEXA Sonae (sonae / FS \ Sierra.) \ NOS — OO . @ Food Eletronics Sports & Fashion Reta
Slide 9: Corporate Strategy
O1.Profile CORPORATE STRATEGY VALUE CREATION through Sonae's 3 strategic pillars Strengthen and leverage our key assets _ and competencies We constantly strive to reinforce our strongest competitive positions and explore new business opportunities that leverage our exceptional capabilities and asset
Slide 10: Sonae's Strategic Pillars: Strengthen and Leverage Key Assets
O1.Profile SONAE’S STRATEGIC PILLARS Strengthen and leverage our key assets — and competencies OLOSAN Investment in Continente’s convenience/proximity network expansion, as long as it protects the competitive position, thus ensuring a leading profitable position in the food retail market (in Portuga
Slide 11: Sonae's Strategic Pillars: Drive International Expansion
O1.Profile SONAE’S STRATEGIC PILLARS Drive international expansion ParkLake was opened in September 1* and is the first Sierra's Shopping Centre development in Romania. It represents an investment of €180M and comprises over 200 stores in 70 thousand sqm. The results so far exceeded our best expecta
Slide 12: Sonae's Strategic Pillars: Diversify Business Models
O1.Profile SONAE’S STRATEGIC PILLARS Diversify business models and investment approach ZIPPY franchising model - 59 stores outside Portugal + A proven concept + Shopping Centre friendly +19 different countries + Successful operations: Latam, Middle East, and Central Europe MoU between Sport Zone, JD
Slide 13: Board of Directors
O1.Profile BOARD of DIRECTORS A good balance between Executive Directors (2 members) and Non-Executive Directors (7 members) all of which independent A multidisciplinar BoD a ‘| (1) Andrew Campbell-Renowned expert on Corporate-level Strategy, Currently Director of the Ashridge Strategic Management C
Slide 14: Group Senior Executives
O1.Profile GROUP SENIOR EXECUTIVES Since 2015 Sonae has been adjusting its internal organisation, making its business units more autonomous, with clear separated Executive Committees, thus enabling higher levels of specialization and focus SRA Responsible for each division of the Group = é - . . (1)
Slide 15: An Attractive Investment Opportunity
02 AN ATTRACTIVE INVESTMENT OPPORTUNITY
Slide 16: Sonae as a Holding Company
02. An attractive investment opportunity SONAE ASA HOLDING COMPANY 1. Enterprise Value 2. Invested Capital 3. Consolidated Turnover 4. Total EBITDA 5. Balance Sheet 6. A stable shareholder structure 7. Shareholder Remuneration 8. Share Price SRRIAS
Slide 17: Enterprise Value
02. An attractive investment opportunity 01. ENTERPRISE VALUE A balanced portfolio of businesses spanning multiple sectors €5,142 MEV €3,851 M NAV (as of 1H17) SONAE’S PORTFOLIO DIVIDED BY EV Sonae’s EV split (as of 1H17) Sierra MC 2% 36% IM oe 3% RP 18% Worten S&F 10% 7h SPRIAS ASSUMPTIONS: Sonae M
Slide 18: Invested Capital
02. An attractive investment opportunity 02. INVESTED CAPITAL €3,453 MIC (as of 1H17) Long-term target RolC 11% SONAE’S PORTFOLIO DIVIDED BY IC Sonae’s IC split (as of 1H17) Worten --" 1% Sierra 17% Sports & Fashion 11% FS o% IM 4% Maxmat 1% * Proportional annualized EBIT with Sonae Sierra capital g
Slide 19: Consolidated Turnover
02. An attractive investment oppor 03. CONSOLIDATED TURNOVER REACHED € 2,603 M TURNOVER rtunity IN LH17 Turnover breakdown (1H17) % Total Turnover iy RPMaxmat_FS 3% 2%. 1% 0.4% Sports & Wl Fashion 10% In million euros 2,410 i Sonae MC 1H17 MWorten | S&F MiSonaeRP MlSonae|M Ml Maxmat 1H16 Sonae FS SP
Slide 20: Total EBITDA
NOS* 10% Sierra* 10% FS 1% IM 1% MC 47% Maxmat 1% RP 25% S&F Worten -1% 4%
Slide 21: Balance Sheet
02. An attractive investment opportunity 05. BALANCE SHEET Refinancing needs for next 18 months already secured Maturity profile is currently above 4 years Average interest rate of outstanding debt continued to decrease and reached 1.5% on June 30% 2017 SIGNIFICANT DELEVERAGING MADE SPRIAS ~ POSSIBL
Slide 22: Balance Sheet: Capital Structure
SPRIAS 02. An attractive investment opportunity 05. BALANCE CAPITAL SHEET STRUCTURE Retail Net Debt/ EBITDA NOS Net Debt/EBITDA AN AP PRO PRIATE Long-term target: <3.0 Long-term target: 2.0 1 ‘ , 26 25 1 . 21. . . . CAPITAL STRUCTURE | 3 m | om e L 20; ig | sj 20 In each business f j | | | to suppor
Slide 23: Stable Shareholder Structure
02. An attractive investment opportunity 06. STABLE SHAREHOLDER STRUCTURE Reference shareholder, EFANOR, a family holding company i» EURONEXT SHAREHOLDING STRUCTURE Others 33.1% Efanor 52.7% 2s om gy Equity Swap ZT 5.2% Magallanes A 2.0% BPI Sonae 3.7% Management 0.8% SHARE CAPITAL AVERAGE DAILY VOL
Slide 24: Shareholder Remuneration
SPRIAS 02. An attractive investment opportunity 07 SHAREHOLDER REMUNERATION Steadily growing dividend payer to maintain an adequate shareholders remmuneration 7. STEADILY GROWING DIVIDEND Dividend per share evolution . cents (in € cents) Dividend per share 3.85 4.00 y.0.y, increase of aprox 5% 3.15
Slide 25: Share Price
SPRIAS 02. An attractive investment opportunity 08. SHARE PRICE Significant discount vs. Sum of the Parts valuation Share price was particularly affected y the global financial crisis, but also by macro and financial problems in Portugal ~ ANALYSTS VALUATION Analysts av 20.2% discount el ° 2 2 price
Slide 26: Competitive Advantages of Such a Diversified Portfolio
02. An attractive investment opportunity COMPETITIVE ADVANTAGES OF SUCHA DIVERSIFIED PORTFOLIO 1. 2. 3. 4. 5. 6 7. 8 Leading market position in food retail market, with benchmark profitability The telco operator with highest turnover growth in the market, and continuously improved profitability Shop
Slide 27: Leading Market Position in Food Retail: Food Formats
02. An attractive investment opportunity MC 4] Hupers 129 Supers 83 Bom Dia 269 Meu Super 204 Well's 1 LEADING MARKET POSITION IN FOOD RETAIL MARKET, WITH BENCHMARK PROFITABILITY: FOOD FORMATS Continente Hypers -41 stores (25 are anchored with leading shopping centres) «Average 7.1 thous. sqm (total
Slide 28: Food Retail: Competitive Advantages
02. An attractive investment opportunity MC Considered over the last 13 years as one of the most trusted brands in Portugal by consumers (survey “Trusted brands” carried out by Reader's Digest) 1 LEADING MARKET POSITION IN FOOD RETAIL MARKET, WITH BENCHMARK PROFITABILITY: COMPETITIVE ADVANTAGES Lead
Slide 29: NOS: Telco Operator with Highest Turnover Growth
02. An attractive investment opportunity N S" A 7 NOS August 27th 2013: ZON OPTIMUS was created On May 162014, NOS was launched, a single brand for all segments and for all services, replacing ZON OPTIMUS * Voting rights somaecom ZOPT 2. THE TELCO OPERATOR WITH HIGHEST TURNOVER GROWTH IN THE MARKET,
Slide 30: Sierra: Shopping Centres
02. An attractive investment opportunity SIERRA 50% JV with Grosvenor + Stakes in 48 Shopping Centres + Net Asset Value €1,392 M Sierra Brazil businesses operate autonomously and is focused on investing, developing and managing shopping centres in Brazil. OMV breakdown 1H17 Germany 1% SBMASSIERRA AN
Slide 31: Worten: Iberian Omnichannel Electronics Player
02. An attractive investment opportunity WORTEN Aiming to build a leading Iberian omnichannel operation Strongly believing that: * There is value for Portugal in growing its Iberian presence (in Spain * Currently, the best solution for Spain is to further turnaround the operations 4. THE IBERIAN OMN
Slide 32: Sports & Fashion
02. An attractive investment opportunity SPORTS & FASHION OWN STORES: Sport Zone 133 MO 108 Zippy 54 Losan10 Salsa 71 Salsa LOSAN SONaS S&F 5. FOCUS ON BUILDING COMPETENCIES TO REACH INTERESTING PROFITABILITY LEVELS IN S&F Sports and Fashion Turnover and Underlying EBITDA evolution 270 1HI16 1H17 TU
Slide 33: Net Asset Value and Sale and Leaseback Transactions
02. An attractive investment opportunity NET ASSET VALUE =) 14 (1H17) million euros GROSS BOOK VALUE 1, 2 7 2 Gy) million euros Assets Wut others Ineame 2% Logistics & Offices. «Wl 15% Some | 6% Continente 43% Continente Modelo 29% Note: Information organisedby anchor 6. CAPITAL GAIN ABOVE €150 M SA
Slide 34: Investment Management: Tech Corporate Venturing Arm
02. An attractive investment opportunity IM Aims to build a portfolio of world class tech-based companies linked to retail and telco leveraging on the strong expertise in these two core businesses of Sonae. 7. THE TECH CORPORATE VENTURING ARM OF SONAE GROUP A PORTFOLIO COMPOSED BY OPERATING COMPANIE
Slide 35: Financial Services
02. An attractive investment opportunity FS THE RECENTLY CREATED BUSINESS UNITAIMED AT FOSTERING FINANCIAL SERVICES * Managed in partnership with MasterCard and BNP Paribas Personal Finance, S.A., which recognises onits balance sheet the credit granted, as well as the responsibility for risk managem
Slide 36: Key Messages
02. An attractive investment opportunity KEY MESSAGES SONAE A long living family controlled company - Sustainability - Ethics - Performance onm A strong corporate culture with a clear mission and values in the DNA A stable shareholder structure . Creating value through 3 transparent strategic pillar
Slide 37: Recent Developments
03 RECENT DEVELOPMENTS
Slide 38: Creation of the Second Iberian Sports Retail Group
03. Recent developments SOuesesearF SPORTS CREATION OF THE SECOND IBERIAN AND FASHION SPORTS RETAIL GROUP MoU FOR THE OPERATION TOTALLY ALIGNED WITH SONAE’S STRATEGIC PILLARS COMBINATION OF: MoU signed on March 9° 2017 5 SPORT ZON E Contract signed on September 14'* 2017 * ¢JDSPORTS a Cee and the fa
Slide 39: Healthy Nutrition: A Segment with Very High Growth Potential
03. Recent developments HEALTHY NUTRITION Western Europe A SEGMENT WITH A VERY HIGH GROWTH POTENTIAL Finland is the country with the highest healthy food consumption per capita Germany and UK are the markets with higher healthy food consumption Some players have already achieved a relevant size, bot
Slide 40: Healthy Nutrition: Two Relevant Steps in Healthy Food Business
03. Recent developments HEALTHY NUTRITION TWO RELEVANT STEPS IN HEALTHY FOOD BUSINESS A SEGMENT WITH A VERY HIGH GROWTH POTENTIAL Acquisition 0 ening of Go Well of the 1* supermarket December 22016 specialised in healthy food Acquisition of a 51% stake * December 6'* 2016 Go Well operates 22 healthy
Slide 41: Healthy Nutrition: Organic Supermarkets Network Expansion
03. Recent developments HEALTHY NUTRITION Organic supermarkets network expansion A SEGMENT WITH A VERY HIGH GROWTH POTENTIAL Agreement for the acquisition of BRIO April 262017 Acquisition of 100% of BRIO’s share capital * Immediate acquisition of 6 stores in key locations + 2,500 SKUs * Immediate ac
Slide 42: Contacts
INVESTOR PRESENTATION September 2017 CONTACTS: Patricia Vieira Pinto Head of Investor Relations Tel: + 351 22 O10 4794 www.sonae.pt ‘SONAE is listed on the Euronext Stock Exchange. Information may also be accessed on Reuters under the symbolSONP.INand on Bloombergunder the symbol SONPL PREVIOUS EVEN