Grupo Elektra SAB de CV · BME:XEKT
Grupo Elektra SAB de CV — Merrill Lynch presentation, July 2003
27 slides from Grupo Elektra SAB de CV's conference presentation, July 2003
Slide 1: Presentation for Merrill Lynch, July 2003
Presentation for: Merrill Lynch July 2003 1
Slide 2: Forward-Looking Statement Disclaimer
Forward-Looking Statement Disclaimer This presentation contains forward-looking statements. We may also make written or oral forward-looking statements in our periodic reports to the Securities and Exchange Commission, in our annual report to shareholders, in our proxy statements, in our offering ci
Slide 3: Agenda
Agenda New Corporate Structure Grupo Elektra 2Q03 Highlights Banco Azteca 2Q03 Highlights Grupo Elektra Total Portfolio Financial Strategy for 2003 Operating Strategy for 2003 3
Slide 4: New Corporate Structure
New Corporate Structure 4
Slide 5: Grupo Elektra Structure
Grupo Elektra Structure Commercial Financial Division Division Credit Insurance Retail (As of Nov. 30, 2002 (TBA) & Latin America) Latin Latin Credimax New Mexico Mexico America Credimax Products America (Other Channels) Services 9 9Almacenes 9Banca por García teléfono 9 9H-E-B 9Internet 9Cuenta Soc
Slide 6: 2Q03 Highlights
2Q03 Highlights (Equity Method) 6
Slide 7: Highlights of 2Q03
Highlights of 2Q03 Income Statement Millions of Pesos Revenues $200 EBITDA $49 +5% +6% $4,947 $1,056 $805 $4,086 $4,232 $4,285 $756 $737 $3,702 $686 2Q 3Q 4Q 1Q 2Q 2Q 3Q 4Q 1Q 2Q 2002 2003 2002 2003 ($64) $84 Gross Profit -4% Operating +15% Income $2,077 $825 $1,731 $1,668 $1,760 $1,667 $629 $545 $5
Slide 8: Highlights of Six Months
Highlights of Six Months Income Statement Millions of Pesos Revenues $382 EBITDA $100 +5% +7% $8,518 $8,136 $1,542 $1,442 6M 6M 6M 6M 2002 2003 2002 2003 $63 $146 Gross Profit +2% EBITDA con +15% Div. Financiera $1,140 $3,427 $994 $3,364 6M 6M 6M 6M 2002 2003 2002 2003 8
Slide 9: Highlights: Balance Sheet
Highlights Balance Sheet Millions of Pesos Cash $804 Total ($1,626) +39% -17% Liabilities $9,466 $10,059 $3,115 $2,844 $8,335 $7,525 $7,840 $2,234 $2,040 $1,830 2Q 3Q 4Q 1Q 2Q 2Q 3Q 4Q 1Q 2Q 2002 2003 2002 2003 Inventories ($202) -7% $3,015 $2,721 $2,591 $2,520 $2,190 2Q 3Q 4Q 1Q 2Q 2002 2003 9
Slide 10: Banco Azteca 2Q03 Highlights
————— Ce) BANCO AZTECA 2Q03 Highlights 10
Slide 11: Net Deposits - Banco Azteca
Net Deposits - Banco Azteca (As of June 30, 2003) 2.5 $3,500 Total Cuenta Socio $ 73 Millions Number of of Guardadito Pesos Accounts 2.0 $2,800 (millions) $3,317 m. 113% 2.0 1.5 Inversíón Azteca $1,407 $2,100 1.0 $1,400 0.5 $700 Guardadito $1,837 $0 2002 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18
Slide 12: Banco Azteca Funding Mix
Banco Azteca Funding Mix Millions of Pesos December 31, 2002 March 31, 2003 June 30, 2003 Deposits Amount % Rate Amount % Rate Amount % Rate Guardadito $785 64% 1.0% $1,357 32% 1.0% $1,837 41% 1.0% Inversión Azteca - 0% - $172 4% 6.0% $1,407 31% 5.8% Cuenta Socio $0 0% 8.0% $26 1% 9.9% $73 2% 7.0% T
Slide 13: 2Q03 Total Portfolio (Credit + Credimax)
2Q03 Total Portfolio (Credit + Credimax) 13
Slide 14: Portfolio by term
Portfolio by term Percentage (%) Average Term: 48 49 49 50 49 4 5 6 10 10 65 weeks 70 69 68 53 weeks 71 69 39 weeks 15 13 13 10 12 26 weeks 9 9 10 10 9 13 weeks 2 1 1 1 1 2Q 3Q 4Q 1Q 2Q 2002 2003 14
Slide 15: Active Credit Accounts
Active Credit Accounts Thousands +150 +7% 2,368 2,155 2,218 1,947 2,016 1,778 Banco Azteca 373 1,119 (Credimax) 1,782 1,098 589 Credit as of Nov. 30, 2002 & Latin America 2Q 3Q 4Q 1Q 2Q 2002 2003 15
Slide 16: Breakdown of Gross Portfolio
Breakdown of Gross Portfolio Millions of Pesos $279 +6% $4,691 $4,744 $4,465 $4,223 $4,522 Banco Azteca Portfolio $3,787 (Consumer and Personal Loans) Grupo Elektra Portfolio $958 (as of November 30, 2002 & Latin America) 2Q 3Q 4Q 1Q 2Q 2002 2003 16
Slide 17: Financial Strategy for 2003
Financial Strategy for 2003 17
Slide 18: Financial Strategy 2003
Financial Strategy 2003 Objectives: 9 To reduce debt. 9 To pre-pay expensive debt. 9 To reduce exposure to dollar-denominated debt. 9 To separate, to a certain extent, Bank and Retail operations. 9 To foster transparency by: ¾ Eliminating inter-company agreements. ¾ Separating Bank and Retail assets
Slide 19: Financial Strategy 2003: Transactions with Banco Azteca
Financial Strategy 2003 During 1Q03, Grupo Elektra entered into a series of arms-length transactions with Banco Azteca, including: 9 Sale of Assets directly related with Banco Azteca’s day-to- day operations. 9 Rent and utilities paid in advance: 9 Elektrafin conducted five private securitization tr
Slide 20: Financial Strategy 2003: Cash In and Cash Out
Financial Strategy 2003 Cash In: Sale of assets, rent and utilities Ps.$ 650 m. Private securitization Ps.$1.7 bn. Peso debt issued Ps.$ 550 m. Cash Out: Payment of US$ debt US$ 182 m. Payment of public securitization Ps.$2.45 bn. 20
Slide 21: Maturity of Debt with Cost as of 4Q02
Maturity of Debt with Cost as of 4Q02 Millions of Pesos $2,898 $1,370 $537 $169 $169 $0 2003 2004 2005 2006 2007 2008 Total Debt with Cost*: $5,142 Cash: $3,119 Net debt: $2,023 * Total Debt with Cost Ps. $5,142 = Short Term debt of Ps. $1,370 + Long Term Debt of Ps. $3,772 21
Slide 22: Maturity of Debt with Cost as of 1Q03
Maturity of Debt with Cost as of 1Q03 Millions of Pesos $2,965 $792 $17 $2 $0 $0 2003 2004 2005 2006 2007 2008 Total Debt with Cost*: $3,775 Cash: $2,236 Net debt: $1,539 * Total Debt with Cost Ps. $3,775 = Short Term debt of Ps. $795 + Long Term Debt of Ps. $2,980 22
Slide 23: Maturity of Debt with Cost as of 2Q03
Maturity of Debt with Cost as of 2Q03 Millions of Pesos $2,888 $638 $394 $2 2003 2004 2005 2006 2007 2008 Total Debt with Cost*: $3,922 Cash: $2,844 Net debt: $1,078 * Total Debt with Cost Ps. $3,922 = Short Term debt of Ps. $1,021 + Long Term Debt of Ps. $2,901 23
Slide 24: Operating Strategy for 2003
Operating Strategy for 2003 24
Slide 25: New Stores
New Stores 9 Started 2003 with 90 “new” stores resulting from the conversion of our THE ONE stores. 9 No new net stores (15-20 openings plus 15-20 closings of unproductive stores). 9 Openings in underpenetrated locations: ¾ New regions. ¾ Suburbs of cities. ¾ Cities with 50,000 habitants. 25
Slide 26: Increased Efficiencies & Savings
Increased Efficiencies & Savings Two main initiatives to increase efficiencies & savings: 9 A new compensation system based on personal contribution: ¾ Contribution = Sales – Costs & Expenses – Imputed CC 9 The separation of assets between the retail division and Banco Azteca coupled with arm’s leng
Slide 27: Presentation for Merrill Lynch, July 2003
Presentation for: Merrill Lynch July 2003 27
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