Grupo Elektra Sab De Cv · BME:XEKT
Grupo Elektra Sab De Cv — Debt Investor Presentation (October 2024)
35 slides from Grupo Elektra Sab De Cv's debt investor presentation, October 2024
Slide 1: Company Presentation
Company Presentation October 2024
Slide 2: Disclaimer
Disclaimer This presentation (the “Presentation”) does not constitute an offer to sell, or the solicitation of an offer to buy, any securities of Grupo Elektra S.A.B. de C.V. (“Grupo Elektra” or the “Company”), Nueva Elektra del Milenio S.A. de C.V. (“NEM”) or Mexico Remittances Funding Fiduciary Es
Slide 3: Today’s Presenters
Today’s Presenters Esteban Galíndez Deputy Chief Financial Officer – Grupo Salinas • Mr. Galindez has been the Finance Director of Grupo Salinas since 2010 • He has vast experience in strategic positions since 2000 in Grupo Elektra, where he also served as Finance Director • He holds an MBA from McG
Slide 4: Table of Contents
Table of Contents Executive Summary 4 Business Overview 10 Key Highlights 14 Financial Overview 25 Appendix 29 3
Slide 5: Executive Summary
me grupo elektra Executive Summary
Slide 6: Executive Summary
Executive Summary • Grupo Elektra, S.A.B. de C.V. (“Grupo Elektra” or “Elektra”) is a leading Latin American specialty retailer and financial services company with LTM 2Q’24 Revenue over US$10 billion — Owns Banco Azteca, the largest commercial bank in Mexico in terms of branches and personal loan p
Slide 7: Business Overview
me grupo elektra Business Overview
Slide 8: Grupo Elektra at a Glance
Grupo Elektra at a Glance Grupo Elektra is the leading financial services company and specialty retailer in Latin Company Footprint America, and a major provider of short-term, non-bank consumer loans in the U.S. Contributing to improve the purchasing power of millions of families underserved by tra
Slide 9: Core Business Segments
Core Business Segments Grupo Elektra is a highly diversified company operating across two distinct business segments Controlling Shareholders Public Float 73.9%(1) 26.1% COMMERCIAL BUSINESS FINANCIAL BUSINESS Revenue LTM 2Q’24(2): US$4,127M Revenue LTM 2Q’24(2): US$6,234M 40% of Consolidated Revenue
Slide 10: NEM: Summary Overview of Business
NEM: Summary Overview of Business NEM is a wholly-owned operating subsidiary of Grupo Elektra and is engaged in the operation of Elektra’s Footprint in Mexico (Number of Stores per State) retail stores with 70+ years of operational experience and providing money remittance services for 30+ years 1-3
Slide 11: Payment Channels Inbound
Payment Channels Inbound Mom & Pops Direct to bank account SENDER Cash App BAZ ATM baz Direct to WhatsApp súperapp Pick-up bank Directo a Cuenta BENEFICIARY The client needs to have a bank account (Guardadito) 10
Slide 12: Key Highlights
me grupo elektra Key Highlights
Slide 13: Key Highlights – Successfully Positioning the Remittance Business
Key Highlights – Successfully Positioning the Remittance Business 1 Mexico Has a Strong Remittance Market Supported by a Large and Increasingly Affluent Mexican Community in the U.S. 2 Significant Growth in the Mexico Remittance Business Benefiting from Long-Standing Relationships with Diversified U
Slide 14: Mexico Has a Strong Remittance Market…
1 Mexico Has a Strong Remittance Market… Mexico is the second-largest recipient of remittances worldwide and flows have come to represent 3.5% of GDP as of 2023, with ~96% coming from the U.S. • Mexican remittances have grown at a ~8.5% CAGR since 2010 and have continued to gain more prominence in M
Slide 15: …Supported by a Large and Increasingly Affluent Mexican Community in the U.S.
1 …Supported by a Large and Increasingly Affluent Mexican Community in the U.S. Rise in remittances from the U.S. to Mexico is supported by a large Mexican migrant base, with 97% of total Mexican emigrants living in the U.S. where a growing number are part of the U.S. Labor Force Mexicans % Total U.
Slide 16: Significant Growth in the Mexico Remittance Business…
2 Significant Growth in the Mexico Remittance Business… Elektra has a very strong track record of processing remittance flows, evidence of the Company’s long-standing roots and market share for remittances in Mexico Elektra Remittance Flows from Designated Remitters (US$ millions) $11,264 $10,956 $9
Slide 17: …Benefiting from Long-Standing Relationships with Diversified U.S. MTOs
2 …Benefiting from Long-Standing Relationships with Diversified U.S. MTOs NEM maintains very strong relationships with a diversified network of MTOs, with some long-standing partnerships. The remitters specified below constitute the “Designated Remitters” Formerly PNC and formerly Bancomer Transfer
Slide 18: Crucial Value Proposition Has Created Scale and Enhanced Barriers to Entry
3 Crucial Value Proposition Has Created Scale and Enhanced Barriers to Entry NEM’s Business is Crucial to the Mexican Economy… …and Systematically Important to the Payments System in Mexico NEM directly impacts ~800k (2.1%) of Mexican households Mexico’s dependence on 53% of the Mexican population 6
Slide 19: High Overcollateralization of Flows…
4 High Overcollateralization of Flows… Future Flow structure backed by remittances flows from Elektra’s Designated Remitters provides significant collateral, with the Reserve Account and Series Account totaling US$37.5 million available to service debt offering further credit support US$2.5B US$2.5B
Slide 20: …With the Ability to Amortize Quickly
4 …With the Ability to Amortize Quickly US$M In the event of an Early Amortization requirement, Grupo Elektra has the ability to pay down US$500 million of Illustrative Senior Secured Notes in under 20 days due to significant Cash Flow from Designated Remitters and substantial Reserve and Series Acc
Slide 21: Experienced Management Team and Board with Deep Industry Knowledge
5 Experienced Management Team and Board with Deep Industry Knowledge Board of Directors Key Members of Grupo Elektra’s Management Team Executive Directors Position Director Since Executives Position Officer Since Chairman of the Board/Non-independent Director/Significant Ricardo B. Salinas Pliego(1)
Slide 22: Consistent Focus on Corporate Governance and ESG Leadership
6 Consistent Focus on Corporate Governance and ESG Leadership 2019: 2021: 2023: Banco Azteca was among the 100 Accession to the Women’s Empowerment Official accession of Banco Azteca to the TCFD entities with the best corporate Principles (WEPs) guidelines. Analysis of the environmental reputation M
Slide 23: Financial Overview
me grupo elektra Financial Overview
Slide 24: Consolidated Financial Overview – Grupo Elektra
Consolidated Financial Overview – Grupo Elektra Grupo Elektra has demonstrated consistent growth across Key Performance Indicators Consolidated Revenues Consolidated Adjusted EBITDA(1) MXN$ mm US$10,361M US$1,211M $22,015 $21,361 $22,256 $184,151 $190,402 $164,691 $18,139 $146,019 (2) (2) 2021 2022
Slide 25: Strong Capitalization as of June 30, 2024 – Grupo Elektra
Strong Capitalization as of June 30, 2024 – Grupo Elektra Grupo Elektra has ample liquidity of over US$600M with over US$5B of stockholders’ equity USD$ Interest Description Maturity M. Equivalent Rate Commercial Business Cebures Elektra 00223 82 TIIE + 1.10% Nov-24 Cebures Elektra 00124 79 TIIE + 1
Slide 26: Debt Maturity Profile – Grupo Elektra
Debt Maturity Profile – Grupo Elektra US$M Annual Amortization Schedule (as of June 30, 2024) $1,927 $375 $105 $375 $417 $406 $442 $145 $141 $1,446 2024 2025 2026 2027 2028 2029 Total Cebures Bank Debt Senior Notes Illustrative Annual Amortization Schedule (as of June 30, 2024) $2,102 $442 $506 $542
Slide 27: Appendix
me grupo elektra Appendix
Slide 28: Historical DSCR Analysis – Series 2021-1 Notes
Historical DSCR Analysis – Series 2021-1 Notes Quarter: Mar-21 Jun-21 Sep-21 Dec-21 Mar-22 Jun-22 Sep-22 Dec-22 Mar-23 Jun-23 Sep-23 Dec-23 Mar-24 Jun-24 (in US$ Millions) Total Collections(1) $ 2,508.2 $ 3,710.5 $ 3,793.8 $ 3,913.8 $ 3,580.2 $ 4,159.4 $ 4,157.4 $ 4,227.7 $ 3,836.0 $ 4,835.7 $ 4,428
Slide 29: Commercial Business Liquidity
Commercial Business Liquidity MXN$ mm 2Q 2024 Cash on Hand and Equivalents $12,109 Marketable Financial Instruments $3,613 Financial Instruments $23,319 Restricted Cash ($16,368) Availability of Cebures Programs $16,335 Undrawn Balance of Credit Lines Open with Financial Institutions $5,225 Short Te
Slide 30: Tax Contingencies
Tax Contingencies MXN$ mm Grupo Elektra is currently engaged in several pending legal proceedings against the Mexican tax authority (the “SAT”) involving tax assessments currently being challenged and which, if definitively determined against Grupo Elektra, would result in a tax liability. While Gru
Slide 31: GEKT’s Balance Sheet
GEKT’s Balance Sheet MXN$ mm GRUPO ELEKTRA, S.A.B. DE C.V. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEET MILLIONS OF MEXICAN PESOS Commercial Financial Grupo Commercial Financial Grupo Business Business Elektra Business Business Elektra Change At June 30, 2023 At June 30, 2024 Cash and cash equivalent
Slide 32: GEKT’s Balance Sheet (Cont’d)
GEKT’s Balance Sheet (Cont’d) MXN$ mm GRUPO ELEKTRA, S.A.B. DE C.V. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEET (UN MILLIONS OF MEXICAN PESOS Commercial Financial Grupo Commercial Financial Grupo Business Business Elektra Business Business Elektra Change At June 30, 2023 At June 30, 2024 Demand and
Slide 33: Account Waterfall Structure (1/3)
Account Waterfall Structure (1/3) 1 Payment by Designated • Pursuant to the related Notice and Consent, on each Business Day, each Designated Remitter will deposit all related Eligible Collections to the Pass-Through Account (a Remitters to the Pass-Through Peso-denominated account held by the Colla
Slide 34: Account Waterfall Structure (2/3)
Account Waterfall Structure (2/3) 3 e) fifth, after conversion into Dollars, transfer to the Program Payment Account an amount to pay pro rata (i) to each Person to the extent owed amounts under the transaction documents on the next payment date (other than amounts owed to the Originator, the SPV an
Slide 35: Account Waterfall Structure (3/3)
Account Waterfall Structure (3/3) 4 Program Payment Account e) fifth, all remaining amounts will be retained in the Program Payment Account and applied to make the allocation for payment in clauses (a) through (d) under Waterfall (Cont.) “Program Payment Account Waterfall” on the next Program Paymen
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