Grupo Rotoplas Sab De Cv · BMV:AGUA
Grupo Rotoplas Sab De Cv — Q2 2020 Earnings Presentation
32 slides from Grupo Rotoplas Sab De Cv's earnings presentation, 2020
Slide 1: Corporate Presentation Second Quarter 2020
Grupo Rotoplas S.A.B. 4 ‘ _ Corporate Presentation { dy, _ Second Quarter 2020 ‘. = NG
Slide 2: Forward-looking statements
= soplas:. Forward-looking statements /potoplas The contents of this presentation, including text, graphics, images and other materials (“Content”), here contained, is for general information purposes only. While we endeavor to keep the information up to date and correct, Grupo Rotoplas, S.A.B. de C
Slide 3: Investment Considerations
Investment Considerations 6) | WATER A nascent industry of opportunities PROVIDING SOLUTIONS Market leaders WITH A CLEAR PURPOSE 3 Sustainable long-term model “more and better water” 4 5 6 WHERE WE ARE GOING Growth and value opportunities STRONG FINANCIALS Sustainable focus WHY OWN AGUA? Momentum -
Slide 4: Water: A nascent industry of opportunities
WATER A nascent industry of opportunities
Slide 5: Population Growth and Water Supply
Population Growth 2020 2050 Rural,.3.0B _....3.0B Total 7.0B 10.0B for non-agricultural uses increases than the population General population will grow by an average of Water Supply Imbalance in water distribution ] O countries control 6 O of the global fresh water supply nana PPR ross the world, wa
Slide 6: Water Challenges for Sectors of interest
Water Challenges for Sectors of interest Humanity for Rotoplas: people worldwide of the world’s population Water scarcity & live without access to live in areas that have water scarcity adequate sanitation services at least once a month quality Water management & Market Size & Dynamics recycling bil
Slide 7: Case Study — Mexico City
Case Study — Mexico City ior “Nowadays, 40% of inhabitants have problems Awl regarding water access and quality” Poor quality i.e. Nowadays in Tlalpan neighborhood the local government spends US$7M annually in water trucks CDMxX International Airport * The city's water system provides 8% of the supp
Slide 8: Providing Solutions: Market leaders
PROVIDING SOLUTIONS Market leaders
Slide 9: The Company
The Company Compared to 1994. 2.CAGR 2014 ~ LTM20 6 1994 Storage Products () 1 country 800 direct clients 500 employees 3,000 points of sale 2 product lines 8 plants 1 innovation and development center Sales MXN 500mm EBITDA MXN 70mm 2Q20 Water Market Leader 0 14 countries (14x)! 37,500+ points of s
Slide 10: Key metrics 2014 — LTM June 2020
Key metrics 2014 — LTM June 2020 $6,552 $7,868 A 20% Sales 40% 4% A -36% Government sales - 37,500+ A 37,500+ Treatment & purification units $860 OS) $1,480 A 72% EBITDA 2,703 3,246 A843 Employees 13% 4% A9% Client concentration 13.1% 18.8% AS70pb EBITDA Margin 23,000+ 27,500+ A 4,S00+ Points of sal
Slide 11: Decentralized Water Solutions | Business Model
y Decentralized Water Solutions | Business Model /potop!5:. TODAY ----------------------------------------------- > EVOLUTION B2D @ Water Purifying e-commerce _ Products Services “e Residential e Commercial e Schools Storage @ Water flow ® “e Treatment & heating eo Water treatment B2B and recycling
Slide 12: Portfolio | Products and Services
Portfolio | Products and Services Sales by soluton ttm Services 8% Products 92% EBITDA by solution trm Services 2% Products 98% “Results as of 1Q20 PRODUCTS SERVICES STORAGE PURIFICATION Ts ; J a itis Af. Se ie me Water Tanks Cisterns Industrial Other = Residential Institutional WATER FLOW _——" hb.
Slide 13: Favorable Growth Drivers | Tailwinds
Zc Favorable Growth Drivers | Tailwinds /potoplas:. Storage Rapid urban growth = supply interruption > higher demand for water storage products Water demand > centralized system capacity (old infrastructure and poor city planning) a Growing trend of circular economy - use of recycled resins in water
Slide 14: Strategy by country | region
Strategy by country | region 6 Country demographics 0-14 y.o. 13% 3 15-24 y.o. 8% o% 25:54y.0. 21% 2 0%. 55-64 y.o. 4% Hex 65+ y.o. 4% Bs% Rotoplas Strategy: * Maintain product leadership * Boosting services (PTARs, bebbia, drinking water Country demographics 0-14 y.o. 9% Mo” 18-24 y.o. 6% 25-54y.0.
Slide 15: With a Clear Purpose
WITH A CLEAR PURPOSE Sustainable long-term model “more and better water”
Slide 16: Competitive Advantages
Competitive Advantages - Value - Quality - Social Responsibility + Over 27,500 points of sale in America - Over 37,500 points of treatment, recycling and purification Source: Rotoplas. Information as of December 2018. ER OVATION /potoplas bt + Focus on ESG (Environmental, Social & Governance) - Oper
Slide 17: ESG focus
ESG focus /potopls:. sy Q QQ +19,000 hrs! training collaborators on human rights, processes, health and safety, among other topics 53% independent By Board Members Audit, Compensation and Corporate -& Practices Committees chaired by independent Board Members GOVERNANC 8 +5,700! oy plumbers trained a
Slide 18: Best Corporate Governance Practices
Best Corporate Governance Practices /n ie) Board of Directors =J Compensation Committee Audit fl Committee A: Corporate Practices Committee Sustainability Committee Our board of directors: Transparency = > Diversity — > Innovation = > Equality = > Experience = > 53% Independent Members 5 internation
Slide 19: Where We Are Going: Growth and value opportunities
WHERE WE ARE GOING Growth and value opportunities
Slide 20: CEO quote on ROIC greater than WACC
“.throughout this transformation effort, Rotoplas should achieve a ROIC greater than WACC in less than 18 months” Carlos Rojas | CEO Flow’s program kick off August 2019
Slide 21: Flow | Transformation Program
Flow | Transformation Program A. Enhance performance of current portfolio * Revenue levers 1) Price & volume optimization * Cost levers 1) Procurement of materials 2) Manufacturing efficiency 3) Distribution costs optimization * Working capital levers 1) Inventory levels optimization 2) Customizatio
Slide 22: --- --- --- --- --- --- --- --- --- --- --- ---
--- --- --- --- --- --- --- --- --- --- --- ---
Slide 23: Water-as-a-Service Platform
Water-as-a-Service Platform Mega Trends 8 Building and H 4 _fes)_ 7-10 years Apotopls- Tal leasing : wwTP ] ie ire contract => { Wastewater treatment . and recycling plants ’ Syltesa.w oy \ a Treated \ Water Teuse & q wastewater We coe Operation and maintenance Water discharge to sewage On-site trea
Slide 24: E-commerce platform in the USA
E-commerce platform in the USA The platform: #1 online retailer of water storage products ) Access to a nationwide manufacturing footprint through Tank Co. strategic alliance A 6) Innovation in the water space (storage, septic) to address the pressing needs \ (3) Order online and pick up purchases a
Slide 25: Improve discipline in Capital Allocation
‘potoplas Improve discipline in Capital Allocation Resource allocation for: ie a ® Organic growth Inorganic growth Share buybacks Dividend Payment Debt Payment Coherence matrix approach ) Process: 9 —- p— Project proposal Evaluation IRR > WACC Validation and Quarterly status authorization update Sup
Slide 26: Strong Financials
STRONG FINANCIALS With a sustainable focus
Slide 27: Track Record of Growth and Profitability
Track Record of Growth and Profitability MXN mm Revenue by Country MXN mm $7,777 $6,660 $5,353 ~~ ' 38% 2016 2017 2018 Adjusted EBITDA by Solution MXN mm CAGR: 19.0% $738 14% 2016 2017 mexico MH other Argentina $1,891 $1,904 2% 1% 2% 24% =... = 59% 2009 2920 $1480 2% MH Products I Services 24% L™ Re
Slide 28: Sound Financials
Sound Financials MXN mm Debt amortization calendar Prior to second reopening 80% 20% $2,400 $600 | 2019 2020 2027 After second reopening $1, soot i 0 ll 2019 2020 2027 aaiteres* coverage* 2016 2017 2018 2019 LTM Results as of 1Q20 “Considers interest payments from interest bearing liabilities. “Inte
Slide 29: ROIC vs Cost of Capital
ROIC vs Cost of Capital /potoplas “ Improvement in ROIC through the Flow transformational pr 23.3% ‘\ Greater discipline in Cap ” Allocation (Control Tower). 12.5% 12.9% } Optimization of working capital. 241 bp 9.8% : . nf . /,\ Increased production efficiency in “ manufacturing process. Divestment
Slide 30: Why Own AGUA? Momentum
6 WHY OWN AGUA? Momentum
Slide 31: Business Model Resilience, Sales and EBITDA
Jas. Business Model Resilience Sales RotoP 4.4x CAGR: 11.2% v 7,859 7,790 7.868 )) Continu us growth 6,551 8.660 5 5,399 3,700 6 369 eos . 4,680 ‘) Double digit margins ~ 3,049 ~~ 1769 1.980 2,161 2ais 7569 {Q}Strong Management 7 [ 1 1 1 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 20
Slide 32: Thank you
Thank you ‘NX | INVESTOR RELATIONS as \ Mariana Fernandez x mfernandez@rotoplas.com ~+52 (55) 5201-5000 ext. 50163 q q
Grupo Rotoplas S.A.B. de C.V. — Q2 2020 Earnings Presentation on 6ix