Atento S.A. · OTC:ATTOF
Atento — Q1 2020 Earnings Presentation
31 slides from Atento's earnings presentation, May 8, 2020
Slide 1: Atento Fiscal 2020 First Quarter Results
Atento Fiscal 2020 First Quarter Results Investor Relations Shay Chor shay.chor@atento.com Fernando Schneider fernando.schneider@atento.com
Slide 2: Forward-looking statements
Forward-looking statements This presentation has been prepared by Atento. The information contained in this presentation is for informational purposes only. The information contained in this presentation is not investment or financial product advice and is not intended to be used as the basis for ma
Slide 3: Business Highlights & Strategic Overview
Business Highlights & Strategic Overview Carlos López-Abadía, CEO
Slide 4: First Quarter 2020 Business Highlights
First Quarter 2020 Business Highlights 1 Three Horizon Plan continues gaining traction • Strong MS growth – right clients, right services • Profitability improvements via revenue mix and lower cost structure 2 Effective and timely response for COVID-19 • +60,000 employees working at home, with cente
Slide 5: Three Horizon Plan continues gaining traction
1 Three Horizon Plan continues gaining traction Multisector Growth YoY EBITDA Growth YoY 13.9% 10.1% 6.5% 3.3% 9.4% 8.4% 7.3% 4.6% -0.7% -30.7% 1Q19 2Q19 3Q19 4Q19 1Q20 1Q19 2Q19 3Q19 4Q19 1Q20 • Diversification of our client portfolio mix • Continued positive EBITDA trend toward fast-growing vertic
Slide 6: Effective and Timely Response to COVID-19
2 Effective and Timely Response to COVID-19 Proud of being a socially-responsible company… • Helping assure continuity of essential services for citizens around the world through remote and secure customer services • Services launched for Latin-American governments to facilitate information manageme
Slide 7: Resolved Uncertainty Related to Shareholder Structure
3 Resolved Uncertainty Related to Shareholder Structure World-leading institutional investors with long-term horizons “We have long admired Atento as the • HPS, GIC and Farallon to invest independently leading CRM/BPO provider in Latin • Strong endorsement of our growth strategy America. Farallon is
Slide 8: Strong Post-Crisis Future
4 Strong Post-Crisis Future Strong backlog • 16% increase in total annualized revenue vs Q1’19, with new logos and big-ticket wins • 30% Born-Digital clients • 55% Next Gen services New growth avenues • Global accounts and US growth • Next Gen Services and Digital Acceleration: WAHA creating new, va
Slide 9: Financial Results Highlights
Financial Results Highlights José Azevedo, CFO
Slide 10: Q1 2020 Consolidated Results: Margin Expansion Under Three Horizon Plan
Q1 2020 Consolidated Results: Margin Expansion Under Three Horizon Plan Revenue: Multisector remains growth engine in all regions • Multisector up 8.4% to 67.5% of total CC Growth US$ MM except per share Q1 2020 Q1 2019 • TEF revenues down 19.9%, mainly reflecting the discontinuation of (%) (1) unpr
Slide 11: Brazil: Margin Expansion Due to Improved Revenue Mix
Brazil: Margin Expansion Due to Improved Revenue Mix CC Growth Multisector growth of 3.6% US$ Q1 2020 Q1 2019 (%) (1) • Revenues fueled by born-digital, resulting from pipeline acquired P&L throughout 2019 Revenue 172.0 218.3 -7.1% • TEF revenues decreased 30.2% mainly due to the discontinuation Adj
Slide 12: Americas: Margin Expansion Due to Better Revenue Mix
Americas: Margin Expansion Due to Better Revenue Mix CC Growth Revenues up 1.1% in Q1 US$ Q1 2020 Q1 2019 (%) (1) • Multisector up 8.4%, with higher volumes in Mexico and Colombia P&L • Higher volumes in Tech and Born-digital vertical combined Revenue 147.4 161.7 1.1% with pipeline acquired in 2019
Slide 13: EMEA: Strong Diversification Via Multisector
EMEA: Strong Diversification Via Multisector CC Growth Multisector growth of 16.5% in Q1 US$ Q1 2020 Q1 2019 (%) (1) • Multisector growth from programs acquired in 2H of 2019 P&L • Multisector mix at 48.1%, 840 bps higher vs Q1 2019 Revenue 57.5 62.1 -4.8% • Revenues from TEF decreased 18.5%, due to
Slide 14: Cash Flow: Improved Working Capital
Cash Flow: Improved Working Capital US$ MM Q1 2020 Q1 2019 Better cash flow Cash and cash equivalents at beginning of period 124.7 133.5 • Positive results of transformation plan combined with collections Net Cash (used in) from Operating activities 4.4 (39.8) efforts under new working capital manag
Slide 15: Balance Sheet: Use of Credit Facilities to Increase liquidity
Balance Sheet: Use of Credit Facilities to Increase liquidity Outstanding Cash and Cash equivalents of $162.8 million US$ MM Maturity Interest Rate • Drew down ~$77 million from existing revolvers Balance 1Q'20 • On April 6, 2020, Atento paid down a daily revolver line of $8.6 Senior Secured Notes 2
Slide 16: Thank you
Thank you investors.atento.com
Slide 17: Appendix
Appendix About Atento Financial Reconciliations Debt Information Glossary
Slide 18: About Atento
About Atento
Slide 19: Atento at a Glance
Atento at a Glance Company Overview: Revenue Diversification Overview FY Revenue by Vertical and Geography(2) Leading CRM BPO provider in Latin America and the fourth largest 15.2% globally by revenue 25.6% Long-standing relationships with blue-chip clients 37.9% 45.6% Superior pan-LatAm deliv
Slide 20: We have diversified our client base and value proposition
We have diversified our client base and value proposition to become a market leader and now setting foundations to lead the next generation of CX services 199 201 2019+ 9 8 • TEF call center • Public Company VALUE • Pure-play call center • Diversified CRM/BPO services PROPOSITION • We connect over 40
Slide 21: Long-Lasting, Blue-Chip Client Base
Long-Lasting, Blue-Chip Client Base Highest client retention in the market, driven by excellence in service offering Loyal Client Base With Best-In-Class Retention Tech Global Transportation & Ridesharing App Global Technology & Phone Company Other Financial Services 98.7% Client Retention(1) 10+ ye
Slide 22: The Only Scale Provider of Differentiated CRM BPO Solutions in LatAm
The Only Scale Provider of Differentiated CRM BPO Solutions in LatAm Uniquely Positioned to Capture Digital Growth We Provide Differentiated End-To-End Customized Solutions The Only Platform to Serve Large Clients Across LatAm 2018 LatAm CRM BPO market share (%) – 16.7% Mexico 19.9%(1) Colombia Braz
Slide 23: Shareholders' Structure
Shareholders’ Structure Post IPO on Oct 2014 Post Secondary Offering on Nov 2017 On March 31, 2020 5.6% 15.2% 34.4% 30.0% 65.6% 64.3% 84.8% Bain Capital Free-float Bain Capital Free-float Bain Capital Free-float Treasury Shares 23
Slide 24: Appendix
Appendix AtTEmwtTo
Slide 25: Adjustments to EBITDA by Quarter
Adjustments to EBITDA by Quarter Fiscal Fiscal 2018 Fiscal 2019 2020 ($ in millions) Q1 Q2 Q3 Q4(1) FY(4) Q1 Q2 Q3 Q4(1) FY(4) Q1 Profit/(loss) for the period (1.7) 4.0 3.1 15.0 20.5 (45.6) (6.6) 1.3 (29.6) (80.7) (7.4) Net finance expense 19.6 21.9 18.3 (4.2) 55.6 17.3 19.1 13.8 6.9 57.1 16.9 Incom
Slide 26: IFRS 16 Effect
IFRS 16 Effect Income Statement Effect Net Debt Outstanding IFRS 16: Effect (Q1 2020) US$ MM Maturity Interest Rate Balance 1Q'20 Revenue 0.0 Senior Secured Notes 2022 USD 6.125% 495.3 EBITDA 17.0 Super Senior Credit Facility 2020 USD 5.223% 50.0 Depreciation & Amortization (11.7) Other Credit Facil
Slide 27: Add-Backs to Net Income by Quarter
Add-Backs to Net Income by Quarter Fiscal Fiscal 2018 Fiscal 2019 2020 (1) (1) (1) (1) ($ in millions, except percentage changes) Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY Q1 Profit/(Loss) attributable to equity holders of the parent (1.7) 4.0 3.1 15.0 20.5 (45.6) (6.6) 1.3 (29.6) (80.7) (7.4) Acquisition and i
Slide 28: Effective Tax Rate
Effective Tax Rate ($ in millions, except percentage changes) Fiscal 2018 Fiscal 2019 Q1 2018 Q2 2018 Q3 2018 Q4 2018 Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 2014 FY Profit/(loss) before tax1 33.9 (44.5) 3.9 3.6 6.9 19.6 (10.6) (9.7) 3.5 (27.6) (7.6) (+) Total Add-backs to Net Income (excluding tax
Slide 29: FX Rates
FX Rates Average Average Average FX Assumptions Q1 2018 Q2 2018 Q3 2018 Q4 2018 FY 2018 Q1 2019 Q2 2019 Q3 2019 Q4 2019 FY 2019 Q1 2020 Euro (EUR) 0.81 0.84 0.86 0.88 0.85 0.88 0.89 0.90 0.90 0.89 0.91 Brazilian Real (BRL) 3.25 3.60 3.96 3.81 3.65 3.77 3.92 3.97 4.12 3.94 4.46 Mexican Peso (MXN) 18.
Slide 30: Revenue Mix by Service Type
Revenue Mix by Service Type Fiscal 2018 Fiscal 2019 Fiscal 2020 Q1 Q2 Q3 Q4 FY Q1 Q2 Q3 Q4 FY Q1 Customer Service 51.1% 51.8% 50.6% 50.3% 50.7% 51.7% 52.0% 53.0% 54.6% 52.8% 56.4% Sales 18.1% 18.0% 18.3% 18.5% 17.7% 17.0% 16.9% 16.9% 15.6% 16.6% 13.3% Collection 7.3% 7.5% 8.2% 8.8% 8.2% 7.9% 7.8% 7.
Slide 31: Number of Workstations and Delivery Centers
Number of Workstations and Delivery Centers Number of Work Number of Service Stations Delivery Centers (1) Q1 2020 Q1 2019 Q1 2020 Q1 2019 Brazil 49,821 49,547 33 34 Americas 39,659 37,423 48 51 Argentina (2) 4,358 4,475 12 12 (3) 2,516 2,338 3 4 Central America Chile 2,549 2,878 4 4 Colombia 9,087