Grupo Bimbo Sab De Cv Class A · BMV:BIMBO/A
Grupo Bimbo Sab De Cv Class A — Investor Presentation (June 2009)
44 slides from Grupo Bimbo Sab De Cv Class A's investor presentation, June 2009
Slide 1: Grupo Bimbo, June 2009
M@X\Gruro *Z/GIMBO: June 2009
Slide 2: Grupo Bimbo Today
Grupo Bimbo Today A global leader in the baking industry Strong market share and brand recognition Profitability and returns above industry average LTM Revenues: US$7.6 billion* LTM Revenues Pro-forma: US$9.4 billion* ** Market capitalization: US$6.1 billion * LTM figures as of March 31,
Slide 3: Broad Regional Profile
Broad Regional Profile Largest baker in the Americas Presence in 18 countries Robust product portfolio 150+ brands 35 plants 5,000+ SKUs Czech Republic Product categories (packaged): sliced bread, sweet baked goods, snack cakes, cookies, crackers, bagels, English 43 plants muffins, salty s
Slide 4: Grupo Bimbo's Structure
Grupo Bimbo’s Structure Market diversification enhances upside potential MEXICO UNITED STATES CENTRAL & SOUTH AMERICA #1 in baked goods #1 nationwide #1 in 13 countries #2 in cookies and crackers #2 in Argentina #2 in salty snacks #2 in confectionery #1 pastry chain Leader in Beijing and Tianjing Re
Slide 5: Grupo Bimbo's LTM Pro-Forma Mix
Grupo Bimbo’s LTM Pro-Forma Mix NET SALES: US$ 7.6 billion LTM EBITDA: US$907 million (12.0%) LTM Current Mix U.S. U.S. 15% 28% Mexico 77% Latam Mexico 8% 59% Latam 13% NET SALES: US$ 9.4 billion LTM Pro-Forma EBITDA: US$1.1 billion (12.0%) LTM Pro-Forma U.S. 42% Pro-Forma Mix U.S. 32% Mexico 62% Me
Slide 6: Mexican Operations
Mexican Operations MXP MM 2007 2008 LTM Net Sales $53,504 $57,072 $57,313 Leader in sliced bread % change 7.2% 6.7% 5.7% Leader in sweet baked goods EBITDA $8,018 $8,869 $8,802 Second player in cookies and crackers EBITDA Margin 15.0% 15.5% 15.4% Second player in salty snacks and confectiona
Slide 7: U.S. Operations (BBU)
U.S. Operations (BBU) BBU’s Bread Share* BBU 24% Others LTM Pro- 20% US$ MM 2007 2008 LTM forma Net Sales $1,524 $1,621 $2,127 $3,943 Flowers 9% % change 8.9% 6.4% 31.1% 153.4% IBC 10% Private Label EBITDA $51 $49 $136 $361 Sara Lee 26% 12% EBITDA Margin 3.4% 3.0% 6.4% 9.1% BBU’s Sweet Baked Goods S
Slide 8: Latin American Operations
Latin American Operations MXP MM 2007 2008 LTM Grupo Bimbo’s Latin America Market Share* Net Sales $8,180 $11,807 $12,462 Average penetration of packaged bread is 5% % change 37.4% 44.3% 42.0% 35% 28% EBITDA $640 $878 $908 19% 19% EBITDA Margin 7.8% 7.4% 7.3% 16% 16% 12% 9% Plants 27 4% 4% 3% 3% 2%
Slide 9: Historical Performance
Historical Performance
Slide 10: Sustained Growth and EBITDA Generation
Sustained Growth and EBITDA Generation Net sales growth exceeding GDP and population growth Aggressive product innovation Solid margins in the domestic operations International operations contributing to EBITDA since 2004 Net Sales EBITDA (MXP Millions) (MXP millions) 116,673 96,235 14,092 8
Slide 11: Despite Significant Pressures…
Despite Significant Pressures… Rising Raw Material Costs Greater Distribution Investment 48.9 49.0 47.0 47.2 46.2 46.7 46.6 46.0 44.9 44.7 44.2 44.0 42.1 42.0 LTM 2003 2004 2005 2006 2007 2008 LTM 2003 2004 2005 2006 2007 2008 COGS as % of net sales SG&A as % of net sales 2 Raw material prices impac
Slide 12: Solid Profitability Levels
Solid Profitability Levels 40.0 56.7 60 56.2 54.8 53.3 53.7 53.3 54.0 53.4 35.0 53.1 53.0 52.8 55 51.2 51.1 51.0 48.6 47.9 30.0 50 25.0 45 20.0 40 13.0 13.5 13.8 13.7 14.1 13.6 15.0 12.8 12.3 12.2 12.0 11.9 12.035 10.7 10.3 11.1 9.5 10.0 30 9.9 10.3 9.7 9.7 9.3 9.7 9.3 9.2 8.9 8.9 9.0 8.2 8.0 5.0 7.
Slide 13: Mexico
Mexico LTM top line growth of 11.5% mainly driven by carry over pricing Economic conditions having a negative impact on volume performance Better sales execution, more accurate drop sizes and better sales mix Raw material prices being impacted by the devaluation of the Mexican peso, partiall
Slide 14: United States
United States BBU East consolidating since January 21, 2009 Different dynamics by region Top line performance - East driven by volume growth and West by carry over pricing Profitability – Steady for the East and improving significantly in the West Revenue enhancement and cost savings opportuniti
Slide 15: Latin America
Latin America Top line growth exceeding 30% Expansion of the product portfolio and distribution network Integration of new operations Addition of new customers (+90,000 in 2008) 15 bolt-on acquisitions during the last 5 years Operating leverage driven by increased sales Revenues EBITDA m
Slide 16: First Quarter 2009 Results
First Quarter 2009 Results
Slide 17: 1Q09 Results
1Q09 Results Top line growing at a lower pace Commodity prices decreasing but impacted by currencies’ devaluation Higher manufacturing productivity Higher efficiencies at the distribution level Steady cost controls across every region BBU East consolidating since January 21, 2009, boosti
Slide 18: Financial Structure
Financial Structure
Slide 19: Total Debt
Total Debt Acquisition Impact GB GB 2008 2008 Pro-Forma Debt / EBITDA(1) 1.1 x 3.3 x Interest Coverage 11.8x 4.1x 3,114 1,684 698 600 132 GB's Debt Mar. 09 Local Bonds - 09 New Debt Total GB's Pro- Forma Revolver Facility Local Bonds - 02 1) Ratio calculated with Debt and EBITDA in Mexican pesos, ac
Slide 20: Total Debt Breakdown
Total Debt Breakdown 1,684 3,114 698 600 132 Local Bonds - 02 Revolver Facility Local Bonds - 09 * Long-term Debt Total * Local bonds issued on June 10, 2009 Figures in millions of U.S. dollars. FX: 14.3317 19
Slide 21: Amortization Schedule
Amortization Schedule 593 1,040 349 600 394 349 197 80 52 2009 2010 2011 2012 2013 2014 2015 2016 Local Bonds - 02 Revolver Facility Bridge Loan Long-term Debt Local Bonds - 09 Currency Mix Interest Rates Mix Fixed Dollars Rate Floating 43% 38% Rate Pesos 62% 57% Figures in millions of U.S. dollars
Slide 22: Deleveraging Historical Performance
Deleveraging Historical Performance Total Debt Total Debt / EBITDA (US$ Millions) 1,129 3.0 797 822 779 771 755 2.0 554 1.0 0.0 2002 2003 2004 2005 2006 2007 2008 2002 2003 2004 2005 2006 2007 2008 21
Slide 23: Pro-Forma Performance: Deleveraging Impact
Pro-Forma Performance: Deleveraging Impact Total Debt Total Debt / EBITDA (US$ Millions) 3,122 4.0 2,747 2,351 3.0 1,865 1,433 2.0 Fx: 16.00 922 1.0 Fx: 14.00 0.0 2008 2009 2010 2011 2012 2013 2008 2009 2010 2011 2012 2013 Pro-forma Pro-forma FX. 14.00 22
Slide 24: Ratings
Ratings Before WFI Acquisition After WFI Acquisition Outlook Fitch National Scale: AAA National Scale:AA Stable Moody’s Global Scale: Baa1 Global Scale: Baa2 On Review National Scale: Aaa.mx National Scale: Aa2.mx S&P Global Scale: BBB+ Global Scale: BBB Negative National Scale: mxAAA National Scale
Slide 25: Grupo Bimbo's Focus Will Remain on Execution
Grupo Bimbo’s Focus Will Remain on Execution Orderly integration Capture of commercial and operating synergies Cross-border best practices Consolidate our operation in current markets Strict financial discipline 24
Slide 26: An Attractive Investment Alternative
An Attractive Investment Alternative Financial Targets: Maintain financial flexibility 2x Debt / EBITDA ratio Focused on deleveraging - strict Capex and cost control Debt’s average life consistent with future free cash flows Available committed credit lines Diverse funding sources Main
Slide 27: Grupo Bimbo's acquisition of Weston Foods, Inc.
Grupo Bimbo’s acquisition of Weston Foods, Inc. January 21, 2009
Slide 28: Transaction Overview: A Transformative Opportunity
Transaction Overview: A Transformative Opportunity Grupo Bimbo acquired Weston Foods Inc (WFI), the US fresh bakery division of George Weston This transaction is a key opportunity for Grupo Bimbo to strengthen its business WFI has a leading market position in North America, with excellent fina
Slide 29: Weston Foods Inc (WFI)
Weston Foods Inc (WFI) Eastern US Bread Share(3) U.S. Fresh Bakery Business Private WFI Bread, rolls, muffins, bagels, sweet goods 21% Label 24% Retail, food service Private label, Restaurants & Institutional Sara Lee Others 8% 23% Flowers US$ MM 2007 2008 8% P Farms IBC 8% 8% Net Sales $2,057
Slide 30: Strong Brand Portfolio
Strong Brand Portfolio Overview of WFI’s Business Units Bread English Muffins & Bagels Cake Description • Leading baker of premium • Leading value added baked • Leading cake player in bread brands goods player in English Northeast • Strong position in the muffins and growing bagel Northeast presence
Slide 31: WFI Track Record of Delivering Results
WFI Track Record of Delivering Results Net Revenues (US$ MM) EBITDA* (US$ MM and % Margin) 12.1% 12.1% GR 7.0 % CA 2,272 9.8% 2,057 274 8.8% 1,853 1,986 8.1% A GR 249 1,735 0 %C 18. 194 164 141 2004 2005 2006 2007 2008 2004 2005 2006 2007 2008 Strong focus on growing most profitable categories S
Slide 32: Positive Industry Fundamentals
Positive Industry Fundamentals Transaction responsive to: Bread Industry Highly Fragmented Supermarkets account for the majority of retail bread sales Economic uncertainty leads to a decline of meals eaten out Demographic favors healthier and better-for-you products 31
Slide 33: Combination Creates Balanced Brand Portfolio
Combination Creates Balanced Brand Portfolio National leader in premium brands + Diverse portfolio of mainstream brands + Leader in niche brands portfolio + National Brand portfolio that covers all segments and market niches Combined product and regional brand portfolio attractive to regional cu
Slide 34: The New BBU Profile
The New BBU Profile + Plants 35 Routes 7,000+ Associates 15,000+ BBU (13) WFI (22)(1) Pro-Forma 2008 sales of US$3.9 bn and EBITDA US$323 mm (8.2% margin) National presence to better serve our customers Expected net synergies of US$95 mm 1) Includes one plant supplying Thomas’ English muffins
Slide 35: Talented Management: Best in Class
Talented Management: Best in Class Daniel Servitje CEO Gary Prince President Significant experience Acquisition Reynaldo Reyna Fred Penny Integration Western Op. EVP Eastern Op. EVP Turnaround Deep knowledge of heritage regions 34
Slide 36: Attractive Purchase Price
Attractive Purchase Price Business Assets Acquired: Payment of Stock of WFI US$ 2,380 million Trademarks Implied multiples: EV / EBITDA 8.6x Price / Sales 1.1x Financial Assets Acquired: Payment of US$ 125MM of financial assets US$ 125 million Interest income ~US$11 MM 35
Slide 37: Favorable Ratios Comparison: EV / EBITDA
Favorable Ratios Comparison: EV / EBITDA 11.7 11.0 10.8 10.2 10.2 9.8 9.7 9.1 8.8 8.7 9.0 8.6 Dec-07 Jun-08 Dec-08 1) 2) BIMBO Pure Play Global Baking Global Consumer Industry 1) Global Baking includes: Grupo Bimbo, Flowers Foods, General Mills, George Weston, Goodman Fielder, Kellogg, Kraft, Krispy
Slide 38: Significant Synergy Potential
Significant Synergy Potential Full Run Rate Synergies by Year 5 Run Rate Synergies: US$ 95 mm(1) Cumulative Costs to Achieve Synergies: US$ 30 mm Cumulative Capex (IT): US$ 60 mm 80% by the third year Sales & Marketing: Portfolio, Routes G&A: Finance, Administrative Operations: Manufacturing,
Slide 39: Financing Structure: Solid Bank Group
Financing Structure: Solid Bank Group Joint commitment of US $2,300 million Amount(1) Tenor Bridge Facility US$ 600mm 1 year Term Loan US$ 900mm 3 year US$ 800mm 5 year 1) 56% of total loan was funded in Mexican Pesos and 44% in U.S. Dollars 38
Slide 40: An Attractive Acquisition
An Attractive Acquisition Strengthening our presence in the U.S. Complementary acquisition with high quality assets (brands, manufacturing and distribution structure, management) More efficient manufacturing and distribution mix Complementary brand portfolio and regions Best business pract
Slide 41: Bimbo Bakeries USA: A New Industry Leader
Bimbo Bakeries USA: A New Industry Leader An attractive acquisition The right sector The right player North America’s The right fit Top Baker The right valuation The right team 40
Slide 42: United States – Integration Process in place
United States – Integration Process in place Strategic Objectives Maintain visibility and earnings momentum in the East Improve profitability in the West Execute integration to deliver synergy objectives Organization Alignment New BBU structure already defined Sales: balance by category, c
Slide 43: Disclaimer
The information contained in this presentation (the “Presentation”) has been prepared by Grupo Bimbo S.A.B. de C.V. (“Grupo Bimbo”). While the information contained the Presentation has been prepared in good faith, no representation or warranty, express of implied, is or will be made and no responsi
Slide 44: For more information
For more information: Armando Giner Tel: (5255) 5268-6924 aginer@grupobimbo.com Andrea Amozurrutia Tel: (5255) 5268-6962 aamozurrutia@grupobimbo.com Fabiola Medina Tel: (5255) 5268-6552 fmedina@grupobimbo.com www.grupobimbo.com 43