Slide 1: Corporate Presentation (First quarter 2016 results)
Corporate Presentation May 2016 (First quarter 2016 results)
Slide 2: Ferreycorp at a glance
Ferreycorp at a glance
Slide 3: Highlights
Highlights FERREYCORP Established in Peru in 1922 90+ years of business, 70+ years of alliance with CAT currently operating 17 companies within 10 countries employing a workforce of +6,662 employees Key facts 60% Caterpillar Market Share Market cap (Dec-2015) $400M Shareholders +2,500
Slide 4: Corporate History
CORPORATE HISTORY 00’s 10’s International Complementary expansion: CAT and businesses other brands 90’s Organizational (economic sectors, development to take business lines) opportunities arising from large mining 80’s Redefining 2016 business: focus on capital goods 2010 70’s Move operations to 200
Slide 5: Corporate Structure
CORPORATE STRUCTURE Caterpillar dealers Caterpillar dealers and other Other subsidiaries in Peru and in Peru businesses in Central America abroad Guatemala Chile, Colombia , Ecuador El Salvador Belize Nicaragua El Salvador, Honduras Sales 1Q15: US$345mm (79%) Sales 1Q15: US$48mm (11%) Sales 1Q15: US
Slide 6: Sustainable Business Model
SUSTAINABLE BUSINESS MODEL Sales by line of business 2,000 US$1.9Bn 1,800 US$1.72Bn In functional currency sales US$1.67Bn 1,600 grew by 3.5% 1,400 1Q 2015 (S/. 1.34 Bn) vs US$ Millon 1,200 1,000 1Q 2016 (S/. 1.38 Bn) 800 US$437 US$401 600 mm mm 400 Product Support sales 200 10 Year CAGR – 15% - (20
Slide 7: Diverse Customer Base
DIVERSE CUSTOMER BASE 41% OF DELIVERIES COME FROM NON-MINING CUSTOMERS Sales by economic sectors 1% 2% 3% 1% 2% 3% 3% 3% 3% 1% 3% 2% 11% 10% 12% 3% 3% -1% 41% 3% 49% 46% 4% 2% 23% 15% 24% 13% 14% 2010 As of 1Q2015 As of 1Q2016 Open pit mining Underground mining Construction Government Transport Indu
Slide 8: Key capabilities
Key capabilities
Slide 9: Key Capabilities
KEY Long term strategic partnerships CAPABILITIES Ubiquitous market coverage Unmatched supply chain and logistics capabilities Financial strength and funding sources In-depth market knowledge Innovation and Technology Ethics and corporate standards
Slide 10: International Footprint
INTERNATIONAL FOOTPRINT 6,662 Workforce Florida Guatemala Belice El Salvador Honduras Nicaragua Colombia Ecuador Perú Chile Ferreycorp Peru Abroad Total Workforce Employees 3,332 720 4,042 Technicians 2,465 324 2,789 Total (Mar-16) 5,787 1,044 6,831
Slide 11: Strategic Business Partners World-Class Brands
STRATEGIC BUSINESS PARTNERS WORLD-CLASS BRANDS Among many others brands
Slide 12: Ubiquitous Market Coverage
UBIQUITOUS MARKET COVERAGE WE AIM TO BE CLOSE TO OUR CUSTOMERS . . . . . . . . . . . . . . . . . . . Wherever customers operate, will be next to them: . nationwide coverage Bringing services, spares, materials wherever the customer needs With world class service level
Slide 13: Unmatched Logistics Capabilities
UNMATCHED LOGISTICS CAPABILITIES ONE OF OUR MAIN COMPETITIVE ADVANTAGES We move cargo equivalent to 33,000 pounds per day; averaging 2.5 million miles per year to deliver the items where customer needs them • Operating 50+ warehouses, several located in • ISO9002 certification remote locations (eg:
Slide 14: Logistics
LOGISTICS Ferreycorp integrates and administrates all key elements in the logistic chain as a value proposition Vertical integration through complementary businesses: 1) Freight forwarder (Forbis) and 2) Warehouses and terminals (Fargoline) Efficient handling: 100,000 SKUs Day 1: 83% of requests, Da
Slide 15: Corporate Standards: Strong Corporate Governance
CORPORATE STANDARDS STRONG CORPORATE GOVERNANCE • Ferreycorp (FERREYC1) is listed in the Lima Stock Board Exchange since 1962. • Ferreycorp is included in the Corporate Governance Index Dependent Directors Independent Directors of the Lima Stock Exchange since its inception in 2008. Oscar Espinosa E
Slide 16: Caterpillar Market Share in Peru
CATERPILLAR MARKET SHARE IN PERU Open pit mining Hyundai Heavy construction Otros 2% Volvo Liebherr Atlas Copco JCB 5% Sandvik 1% 3% 1% 2% P&H 1% Hamm Case 1% Hitachi 2% 2% Doosan 6% 2% Hitachi Komatsu 3% Komatsu Caterpillar 6% 27% Caterpillar 62% John Deere 10% 64% Include shovels and drills Genera
Slide 17: Financial Performance
Financial Performance
Slide 18: Track Record of Consistent Financial Performance
TRACK RECORD OF CONSISTENT FINANCIAL PERFORMANCE Gross Margin Net Margin 28% 9% 26% 6.8% 24.6% 7% 24.2% 6.0% 24% 22.9% 22.7% 4.7% 5.0% 4.7% 5% 22% 21.1% 21.1% 20.7% 21.2% 20.3% 3.0% 20% 3% 1.9% 1.9% 2.3% 18% 1% 2009 2010 2011 2012 2013 2014 2015 1Q15 1Q16 16% Avg. Exchange 3.007 2.827 2.753 2.635 2.
Slide 19: Investment in Assets: Accounts Receivables
INVESTMENT IN ASSETS 1) ACCOUNTS RECEIVABLES Accounts Receivable evolution by term Factoring US$ MM US$ MM 150 350 140 14 12 300 11 10 130 14 28 12 120 250 110 200 33 13 100 150 292 305 298 315 281 260 90 245 100 185 80 159 50 150 70 0 60 115 2009 2010 2011 2012 2013 2014 2015 1Q15 1Q16 50 Short ter
Slide 20: Investment in Assets: Inventory and Fixed Assets
INVESTMENT IN ASSETS 2) INVENTORY AND FIXED ASSETS Inventory evolution (US$mm) CAPEX evolution (US$mm) 602 584 523 507 72 454 405 338 370 49 25 55 472 451 44 383 377 359 12 31 206 284 257 19 23 30 21 266 20 38 3 21 9 7 13 161 7 13 15 2 5 28 20 95 130 133 140 121 130 113 16 11 16 11 7 45 72 8 9 5 -3
Slide 21: Cash Cycle
CASH CYCLE -44 days of accounts payable Targets: Inventory 120 days 3.0x Payable Cash Cycle of 140 days 45 days 56 days of accounts receivable Receivable 45-60 days 128 days of Inventory (2.81x)
Slide 22: Cash Cycle
CASH CYCLE 165 161 165 4 155.6157.7 157 154 154 152 150 149 145.2 143.4 146 145 141.6 141 136.1 140 3.5 125 3 2.84 2.81 2.78 2.77 2.76 2.71 105 2.69 2.72 2.67 2.64 2.51 2.47 2.46 2.61 2.41 2.5 2.39 2.39 Cash cycle 85 Days Times Collection days 2 Payable days 65 61 58 59 60 58 56 55 56 56 Inventory t
Slide 23: Access to Diversified Sources of Financing
ACCESS TO DIVERSIFIED SOURCES OF FINANCING Natural hedge: revenue-debt Diversified funding base (US$mm) Debt by currency Banks Caterpillar Bonds Soles 20% 2009 191 56 279 US$ 526 MM 0% Quetzales 5% 2015 201 93 295 US$ 589 MM Pesos Chilenos 75% 2014 222 123 295 US$ 640 MM Dollars 2013 236 170 325 US$
Slide 24: Access to Diversified Sources of Financing
ACCESS TO DIVERSIFIED SOURCES OF FINANCING Avg interest rate 6.0% Maturity of financial debt (US$mm) 5.3% 300 292 5.0% 5.0% 4.9% 4.65% 4.65% 4.4% 4.4% 4.2% 250 4.0% 200 3.0% 149 2009 2010 2011 2012 2013 2014 2015 1Q16 150 100 Financial expenses (as% of total sales) 51 50 5.0% 21 14 2 0 4.0% 4.1% - 2
Slide 25: Leverage Ratio Covenant
LEVERAGE RATIO COVENANT Net debt to EBITDA ratio Adjusted debt to EBITDA ratio 4.39 2.93 4.08 2.68 2.86 2.59 3.62 3.50 3.53 3.52 3.48 2.37 2.38 2.46 3.33 3.383.27 3.22 3.28 3.21 2.85 3.06 2.01 2.67 2.25 2009 2010 2011 2012 2013 2014 2015 1Q16 • Adjusted debt: total debt excluding short term debt rel
Slide 26: Profitability Ratios
PROFITABILITY RATIOS 18% 16% 16.0% 14% 14.1% 14.1% 12.1% 13.2% 13.1% 12% 11.3% 11.5% 9.9% 10.6% 10% 10.2% 9.8% 8.1% 8.4% 7.7% 8% 6.7% 8.1% 8.4% 7.3% 7.4% 7.0% 5.8% 6% 6.4% 6.3% 5.9% 5.5% 5.3% 4.6% 4% 4.2% 4.0% 2% 0% 4Q 2013 1Q 2014 2Q 2014 3Q 2014 4Q 2014 1Q 2015 2Q 2015 3Q 2015 4Q 2015 1Q2016 ROE R
Slide 27: Strengthening Balance Sheet
STRENGTHENING BALANCE SHEET Operating cash flow (US$ MM) 227 141 137 129 • Positive cash flow from operations 77 • Inventory reduction 48 • Asset management and turnover (4) 43 • Improvement of cash cycle 2009 2010 2011 2012 2013 2014 2015 1Q16 2014: Free cash flow: US$ 41MM 2015: Free Cash Flow US$
Slide 28: Ferreycorp in the Capital Market
FERREYCORP IN THE CAPITAL MARKET Capital S/. 1’014,326,324 Nº de shares 1’014,326,324 Shareholders composition as of March 2016 Dividend Yield 4.9% Repurchased shares as of April 2016 28,999,454 Local pension Foreign funds Main shareholders as of March 2016 investors 22% Titular % 36% La Positiva Vi
Slide 29: Dividend Policy Annual Compliance
DIVIDEND POLICY ANNUAL COMPLIANCE In 1997, the company´s shareholders approved the dividend policy. A modification was approved to assign minimum and maximum ranges. Cash dividends will amount to 5% of the capital or a ceiling equal to 60% of freely available profits. The remainder will be capit
Slide 30: Contacts
Contacts Administration and Finance Manager: Patricia Gastelumendi Treasury Manager: Liliana Montalvo Investor Relations: Elizabeth Tamayo