Almacenes Exito SA · BVC:EXITO
Almacenes Exito SA — Grupo Éxito — Q1 2018 Earnings Presentation
33 slides from Almacenes Exito SA's earnings presentation, May 17, 2018
Slide 1: 1Q18 Financial Results
1Q18 Financial Results May 17, 2018 “The Issuers Recognition -IR granted by the Colombian Stock Exchange is not a certification about the quality of the securities listed at the BVC nor the solvency of the issuer”.
Slide 2: Agenda
Agenda 1Q18 Financial and Operating Highlights Performance by Country Consolidated Financial Results International Strategy Follow-Up Q&A Session
Slide 3: 1Q18 Financial and Operational Highlights
1Q18 Financial and Operational Highlights Resilient operating performance and positive Net Income driven by diversification strategy Financial Highlights: Net Revenue growth (+6.3% including a negative FX effect of 4.4%) driven by solid sales performance in Brazil and Uruguay and higher contributi
Slide 4: 1Q18 Financial and Operational Highlights
1Q18 Financial and Operational Highlights Resilient operating performance and positive Net Income driven by diversification strategy Expansion Activities: Consolidated CAPEX: COP $377,638 M in 1Q18 (57% expansion) o CAPEX Colombia: COP $62,561 M in 1Q18 (47% real estate including Viva Envigado and
Slide 5: 1Q18 Net Sales Performance: Colombia
1Q18 Net Sales Performance: Colombia Net Sales (1) and SSS (1) trend improved vs last 3 quarters 1Q18 Adjusted by calendar (1) (1) % Var. %Var. % Var. Top line performance affected by In COP M Net Sales % Var. Total Net Sales SSS SSS lower food inflation (-267 bps) Total Colombia 2,575,817 -1.0% -2.
Slide 6: 1Q18 Net Sales Performance: Colombia
1Q18 Net Sales Performance: Colombia Net Sales and SSS trend improvement vs the last 3 quarters Éxito: Single-digit growth of non-food category. o Textiles: inventory efficiency, higher private label and improved communications strategy. o Electronics: high tech improved look-and-feel and service
Slide 7: Growth Leverage Activities in Colombia: Cash & Carry
Growth Leverage Activities in Colombia Cash & Carry Profitable expansion: 8 stores to open to 17 stores in 2018 Strong sales response: 2x sales after conversions 2x sales/sqm vs. the Company´s sales in Colombia Solid mid single-digit margins Solid returns Expected sales over USD 100 M in 2
Slide 8: Growth Leverage Activities in Colombia: Omni-channel Strategy
Growth Leverage Activities in Colombia Omni-channel Strategy 34.8% sales growth in 1Q18 Websites COP 75,000 M Home Delivery 13.5% Sales growth +500.000 deliveries in 1Q18 70% dispatched by Rappi Click and Collect Brick & Mortar @ 300 stores 561 stores Mobile App Digital Catalogs 25% of o
Slide 9: Growth Leverage Activities in Colombia: Fresh Market Concept Carulla Cava
Growth Leverage Activities in Colombia Fresh Market Concept Carulla Cava First store specialized in liquors and delicatessen Wine and Liquors School +150 SKUs of beers from 14 countries The best wines from 12 countries • Innovation of Carulla´s fresh category • Quality, differentiation and s
Slide 10: 1Q18 Net Sales Performance: Brazil
1Q18 Net Sales Performance: Brazil Leadership recovery in Brazil food retail segment driven by Assaí 1Q18 Adjusted by calendar (1) (1) Solid net sales performance driven In COP M % Var. %Var. % Var. Total % Var. from Assaí growth and its increased Net Sales SSS SSS contribution to total sales despit
Slide 11: 1Q18 Operating Results: Colombia
1Q18 Operating Results: Colombia (1) Clear actions to control expenditure levels % Prog Net Revenues Colombia 1Q18 1Q17 0.1% In COP M In COP M 1Q18/17 -2.2% -1.9% -2.7% -4.0% Net Sales 2,575,817 2,602,106 -1.0% 1Q17 2Q17 3Q17 4Q17 1Q18 Other Revenue 123,370 94,036 31.2% Gross Margin 23.3% 24.0% 25.2
Slide 12: 1Q18 Operating Results: Brazil
1Q18 Operating Results: Brazil Higher profitability from solid growth at Assaí and operational improvements at Multivarejo Brazil 1Q18 1Q17 Results in COP affected Food Segment In COP M In COP M 1Q18/17 by a negative 5.2% FX effect Net Sales 9,919,837 9,742,308 1.8% Other Revenue 77,464 67,603 14.6%
Slide 13: 1Q18 Net Sales & Operating Results: Uruguay
1Q18 Net Sales & Operating Results: Uruguay Solid top line and margin growth from efficiency gains Uruguay 1Q18 1Q17 In COP M In COP M 1Q18/17 Results in COP affected Net Sales 709,305 668,377 6.1% by a negative 2.2% FX effect Other Revenue 5,747 5,124 12.2% Ongoing Strategies in Uruguay Net Revenue
Slide 14: 1Q18 Net Sales & Operating Results: Argentina
1Q18 Net Sales & Operating Results: Argentina Libertad outperformed the market from productivity gains despite FX and inflationary effects Argentina 1Q18 1Q17 In COP M In COP M 1Q18/17 Results in COP affected Net Sales 314,809 321,482 -2.1% by a negative 22.2% FX effect Other Revenue 19,009 17,180 1
Slide 15: 1Q18 Consolidated Financial Results
1Q18 Consolidated Financial Results Resilient operating performance and positive Net Income driven by diversification strategy Consolidated Income Statement 1Q18 1Q17 In COP M In COP M %Var Net Sales 13,519,070 13,333,244 1.4% Other Revenue 224,718 192,669 16.6% FX negatively affected Net Revenue 13
Slide 16: Group Share Net Result
Group Share Net Result Net Income reflected financial and operational efficiencies across the region The Net Group Share Result mainly included: o Improved financial expenditures from lower repo rates (Bra (1) -575 bps, Col (1) -250 bps). o Productivity efforts throughout the region that mainly favo
Slide 17: Net Debt and Cash at Holding Level
Net Debt and Cash at Holding (1) Level Improvements from increased dividends and lower financial expenses 570 631 Cash (& other assets) Gross debt (financial liabilities & warranties) Net financial debt -3,942 -3,861 -4,512 -4,491 1Q 2017 -2.1% 1Q 2018 NDF at the holding level: COP$3.9 B as of Mar
Slide 18: Synergies Follow-up
Synergies Follow-up 4 countries USD120 M 28 Initiatives under expected annual run rate in 2018 execution Formats & Brands Cash & Carry Fresh Market 17 stores grew sales above premium stores without the model. 2 stores +15.1% 5 stores +9 % 9 stores +6% 2x 9 17 Sales growth vs Stores Stores expected 1
Slide 19: Synergies Follow-up – Joint Activities
Synergies Follow-up – Joint Activities Growing food purchasing power from solid integration 220 Food containers Example: fruit purchasing 1.2x Volume in 1Q18 vs USD 1.9 M 8% Savings at cost level 1Q17 Joint purchasing of apple, 84 Containers USD 11.2 M orange, tangerine, grape, kiwi, 45 39 pear Join
Slide 20: Synergies Follow-up – Textile Model
Synergies Follow-up – Textile Model Textile model consolidation in the region Textile sales growth and increased sales mix in the region Sales Increased sales growth mix 6.9% 34 bps 18.1% 20 bps 28.4% 58 bps Implemented at Stores in the 4 61 region with textile value proposition stores in Brazil 20
Slide 21: 1Q18 Conclusions
1Q18 Conclusions Top-line growth regardless of a lower inflationary food trend. Positive outcome of international business units improved operating performance despite negative FX effect. Plans to control expenditures continue advancing and improved productivity across all business units, desp
Slide 22: Appendices
Appendices 22
Slide 23: 2018 Outlook
2018 Outlook Colombia Retail expansion of 12 to 15 stores (+20k sqm of gross sales area), including 8 Surtimayorista stores. Fresh Market concept at 5 stores and best performing initiatives to be rolled out at Carulla stores. SG&A expenses to grow below CPI, benefitted by ongoing productivity
Slide 24: 1Q18 Debt by Country and Maturity
1Q18 Debt by Country and Maturity Net debt breakdown by country 31 March 2018, (in COP M) Colombia Uruguay Brazil Argentina Consolidated Short-term debt 1,448,561 413,725 1,170,508 73,179 3,105,973 Long-term debt 3,188,814 - 3,430,075 - 6,618,889 Total gross debt (1) 4,637,375 413,725 4,600,583 73,1
Slide 25: 1Q18 P&L and CAPEX by Country
1Q18 P&L and CAPEX by Country Colombia Brazil Uruguay Argentina Consolidated In COP M 1Q18 1Q18 1Q18 1Q18 1Q18 Net Revenue 2,699,187 9,997,301 715,052 333,818 13,743,788 Gross Profit 655,022 2,245,057 248,778 113,132 3,261,223 % Net revenue 24.3% 22.5% 34.8% 33.9% 23.7% SG&A Expense -547,713 -1,742,
Slide 26: 1Q18 SOTP Analysis
1Q18 SOTP Analysis LTM net LTM recurring Net debt (Last Market Value of (in COP M) (1) LTM ROI (2) Éxito stake revenues EBITDA quarter) the Stake (3) Colombia 11,114,053 589,893 338,553 3,937,008 100% Brazil 41,459,399 2,772,732 2,038,881 3,177,761 18.7% 2,774,060,636 (4) Uruguay 2,654,530 213,715 1
Slide 27: 1Q18 Consolidated Balance Sheet
1Q18 Consolidated Balance Sheet Consolidated Balance Sheet Mar 2018 Dec 2017 Var % (In COP M) Assets 57,536,937 64,515,547 -10.8% Current assets 28,584,160 33,960,011 -15.8% Cash & cash equivalents 2,294,867 5,281,618 -56.5% Inventories 5,579,491 5,912,514 -5.6% Accounts receivable 1,236,581 1,172,4
Slide 28: 1Q18 Consolidated Cash Flow
1Q18 Consolidated Cash Flow Summary Consolidated Cash Flow Statement Mar 2018 Mar 2017 % Var (In COP M) Profit (loss) 202,669 189,882 6.73% Adjustment to reconciliate Net Income 1,206,780 1,080,027 11.7% Cash Net provided (used) in Operating Activities (5,386,786) (5,897,463) -8.7% Cash Net provided
Slide 29: 1Q18 Holding P&L
1Q18 Holding (1) P&L Income Statement Almacenes Éxito 1Q18 1Q17 In COP M In COP M 1Q18/17 Sales 2,570,517 2,597,027 -1.0% Other Revenue 80,818 52,623 53.6% Net Revenue 2,651,335 2,649,650 0.1% Gross Profit 614,303 640,422 -4.1% Gross margin 23.2% 24.2% SG&A Expense -578,593 -568,350 1.8% SG&A expens
Slide 30: 1Q18 Holding Balance Sheet
1Q18 Holding (1) Balance Sheet Holding Balance Sheet Mar 2018 Dec 2017 Var % (In COP M) Assets 14,503,367 15,962,702 -9.1% Current assets 2,286,650 3,273,274 -30.1% Cash & cash equivalents 630,977 1,619,695 -61.0% Inventories 1,185,438 1,111,981 6.6% Accounts receivable 149,893 189,750 -21.0% Assets
Slide 31: 1Q18 Stores & Selling Area
1Q18 Stores & Selling Area Selling Stores & Selling Area Stores Area (sqm) Colombia Éxito 258 632,416 Carulla 99 85,274 Surtimax 124 65,325 Super Inter 71 64,555 Surtimayorista 9 13,951 Total Colombia 561 861,521 Uruguay Devoto 55 38,886 Disco 29 33,421 Geant 2 16,411 Total Uruguay 86 88,718 Brazil
Slide 32: Note on Forward-Looking Statements
Note on Forward-Looking Statements This document contains certain forward-looking statements. This information is not historical data and should not be interpreted as guarantees of the future occurrence of such facts and data. These statements are based on data, assumptions and estimates that the Gr
Slide 33: Investor Relations Contact
María Fernanda Moreno R. Investor Relations Director +574 339 6156 + 574 339 6560 maria.morenorodriguez@grupo-exito.com Cr 48 No. 32B Sur – 139, Av. Las Vegas Envigado, Colombia www.grupoexito.com.co exitoinvestor.relations@grupo-exito.com •“The Issuers Recognition -IR granted by the Colombian Stock