Almacenes Exito Sa · BVC:EXITO
Almacenes Exito Sa — FY2018 Earnings Presentation
40 slides from Almacenes Exito Sa's earnings presentation, Feb 28, 2019
Slide 1: 4Q and FY18 Financial Results
4Q and FY18 Financial Results Feb 28, 2019 “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 4Q/FY18 Financial and Operating Highlights Performance by Country 4Q/FY18 Consolidated Financial Results Synergies Follow-up Strategic Outcome 2018 Outlook 2019 Q&A Session
Slide 3: Strong Net Income Growth from Productivity and Innovation
Strong Net Income Growth from Productivity and Innovation FY18 Net Revenue Recurring EBITDA Net Income Highlights + 8.9%(2) Margin +40 bps + 28.3% 5.7% (1) Financial Highlights: Strong Consolidated Net Revenue growth (10.2% (2) in 4Q and 8.9% (2) for 2018). Recurrent EBITDA margin grew by +51 bp
Slide 4: 4Q/FY18 Financial and Operational Highlights
4Q/FY18 Financial and Operational Highlights Financial Highlights: Consolidated CapEx COP $929,000 M during 4Q18 and COP $2.46 B for 2018 (55% expansion). o CapEx Colombia: COP $411,000 M for 2018 (69% expansion including Viva Malls). Expansion Activities: Food Retail Expansion 4Q18:43 stores (2
Slide 5: 4Q/FY18 Net Sales Performance: Colombia
4Q/FY18 Net Sales Performance: Colombia Continued Improvement in Net Sales and SSS driven by innovation Adjusted by Adjusted by 4Q18 YTD18 calendar ( 1) calendar ( 1) % Var. %Var. % Var. Var. Var. Var. Net In COP M Net Sales % Var. SSS Net Sales Var. SSS Net Sales SSS Total Net Sales SSS Sales Total
Slide 6: 4Q/FY18 Net Sales Performance: Colombia
4Q/FY18 Net Sales Performance: Colombia Continued Improvement in Net Sales and SSS driven by innovation Éxito: The strongest Net Sales and SSS level posted in the last 7 quarters. Positive performance driven by the implementation of the WOW model. SSS growth for two consecutive quarters revers
Slide 7: FY18 Growth Leverage Activities in Colombia
FY18 Growth Leverage Activities in Colombia Innovative Commercial Strategies Éxito WOW Carulla Fresh Market A shopping experience connected to the digital An innovative model offering differentiated, world. healthy and sustainable options Éxito WOW, Country Bogotá Carulla San Lucas – Medellín 2
Slide 8: FY18 Growth Leverage Activities in Colombia
FY18 Growth Leverage Activities in Colombia Cash & Carry format successfully addressing profesional customers • Model adapted from GPA´s Assaí brand • Presence in Bogotá and the Atlantic Coast • Profitable expansion with positive EBITDA since year 1 • Low operating costs and Capex Optimización • Str
Slide 9: FY18 Growth Leverage Activities in Colombia
FY18 Growth Leverage Activities in Colombia Omni-channel, the strongest platform in LatAm with a sales share of 3.4% E-commerce Market place 11.5% Sales growth 1.1K vendors 61 M visits 54.6% GMV* growth Last Mile Digital catalogs +171.9% delivery growth At 155 stores 5.5% sales growth Sales share
Slide 10: FY18 Growth Leverage Activities in Colombia
FY18 Growth Leverage Activities in Colombia Viva Malls, the First Real Estate Commercial Operator in Colombia Real Estate Business Viva Envigado 138k sqm of GLA(1) (+79k sqm in 2018) The largest commercial and business complex Contributed with around one third of the other operating revenue
Slide 11: FY18 Growth Leverage Activities in Colombia
FY18 Growth Leverage Activities in Colombia Loyalty Program “Puntos Colombia”, the largest ecosystem of points in the country • Launched in 2H18 in alliance with Average ticket with points Bancolombia has grown +76% vs 2017 • High potential for data Redemption has monetization: increased over 80% si
Slide 12: 4Q/FY18 Net Sales Performance: Brazil
4Q/FY18 Net Sales Performance: Brazil Annual Net Sales growth of 10.7% (1) driven by Assaí, dynamics at Multivarejo and digital transformation Adjusted by 4Q18 Adjusted by calendar ( 1) YTD18 calendar ( 1) % Var. %Var. Var. Var. Net In COP M Net Sales % Var. Total % Var. SSS Net Sales Var. Net Sales
Slide 13: FY18 Growth Leverage Activities in Brazil
FY18 Growth Leverage Activities in Brazil Strong expansion of Assaí Portfolio Modernization 18 openings in 2018 to 144 stores nationwide Modernization of 23 stores into Mercado Extra and 24.2% sales growth in 2018 13 conversions to Compre Bem stores Renovations of Pão de Açúcar Loyalty Apps Cliente
Slide 14: 4Q/FY18 Operating Results: Colombia
4Q/FY18 Operating Results: Colombia Recurring EBITDA improved 51 bps in 4Q and drove the 11 bps gain for 2018 Colombia 4Q18 4Q17 FY18 FY17 In COP M In COP M 4Q18/17 In COP M In COP M FY18/17 Net Sales 2,967,964 2,934,445 1.1% 10,626,527 10,623,405 0.0% Other Revenue 180,896 140,482 28.8% 609,293 487
Slide 15: 4Q/FY18 Operating Results: Brazil
4Q/FY18 Operating Results: Brazil Recurring EBITDA margin (1) improved 72 bps in 4Q and 52 bps for 2018 Brazil 4Q18 4Q17 FY18 FY17 Food Segment In COP M In COP M 4Q18/17 In COP M In COP M FY18/17 Net Sales 11,530,237 11,441,894 0.8% 39,809,809 40,975,960 -2.8% Other Revenue 83,122 81,164 2.4% 331,91
Slide 16: 4Q/FY18 Net Sales & Operating Results: Uruguay
4Q/FY18 Net Sales & Operating Results: Uruguay Resilient annual performance amidst a challenging macro environment Uruguay 4Q18 4Q17 FY18 FY17 In COP M In COP M 4Q18/17 In COP M In COP M FY18/17 Net Sales 681,479 705,504 -3.4% 2,544,430 2,589,761 -1.8% Results in COP Other Revenue 8,781 7,975 10.1%
Slide 17: 4Q/FY18 Net Sales & Operating Results: Argentina
4Q/FY18 Net Sales & Operating Results: Argentina Resilient operational performance despite macro pressures and negative effect from IAS 29 Argentina 4Q18 4Q17 FY18 FY17 In COP M In COP M 4Q18/17 In COP M In COP M FY18/17 Net Sales 205,971 401,529 -48.7% 1,036,864 1,383,591 -25.1% Results in Other Re
Slide 18: 4Q/FY18 Consolidated Financial Results
4Q/FY18 Consolidated Financial Results Annual Net Sales growth of +8.6% (2) and Recurring EBITDA margin gain of 40 bps (1) Consolidated Income Statement 4Q18 4Q17 FY18 FY17 In COP M In COP M %Var In COP M In COP M %Var Net Sales 15,382,189 15,476,821 -0.6% 54,009,077 55,556,241 -2.8% Other Revenue 2
Slide 19: Group Share Net Result & Dividend Proposal
Group Share Net Result & Dividend Proposal Net Income improvement of 28.3% driven by an optimized structure The Net Income result in 2018 of COP $279,403 M compares to the COP $217,713 M obtained in 2017, from: Lower interest expenses from lesser rates in Bra (-50 bps to 6.5%) and Col (-50 bps to
Slide 20: FY18 Net Debt and Cash at the Holding Level
FY18 Net Debt and Cash at the Holding Level (1) Improvement from lower financial expenses and better distribution in consolidated indebtedness 1,620 1,886 Net Debt/Adjusted EBITDA ratio (2) Cash (& other At Holding Level assets) -1,889 Gross debt -2,508 (financial -3,775 liabilities & -4,128 warrant
Slide 21: Synergies Follow-Up: Run rate of USD 160 M achieved in 2018
Synergies Follow-Up Run rate of USD 160 M achieved in 2018 (vs USD 120 M expected and one year ahead of schedule)
Slide 22: Synergies Follow-up – Joint Negotiations
Synergies Follow-up – Joint Negotiations Food & Non Food Goods & Services 930 33 USD 42.7 M 36 USD 107 M Containers Categories Joint purchases Categories negotiated Joint purchases negotiated Most important category: Most important category: Fruits cleaning services Consolidated purchasing power in
Slide 23: Synergies Follow-up - Format Replication
Synergies Follow-up - Format Replication Cash & Carry Fresh Market +10 Stores opened in 2018 León XIII - Col 18 Stores in country 20 stores growing +7 pp +27 vs other stores 2.0x Stores opened in 2018 15 stores growing +5 pp Sales multiplier vs other stores vs previous banner 6 stores growing +11 pp
Slide 24: Synergy Plan – Next steps
Synergy Plan – Next steps Moving from sharing best practices to building together future initiatives On innovation Omnichannel experience Check-out solutions, customer journey improvement… Improvement of Channels and Formats E-commerce, premium formats, proximity, Cash & Carry, WOW, Fresh Market… In
Slide 25: 2018 Outlook vs. Outcome Colombia Brazil
2018 Outlook vs. Outcome Colombia Outlook 2018 Outcome * Surpassed target with the opening of 17 stores: 4 Éxito, 1 Carulla, 2 SuperInter and Retail expansion of 12-15 stores (+20k sqm of gross sales area), 10 Surtimayorista stores). including opening of 8 Surtimayorista stores * + 22k sqm of gross
Slide 26: 2018 Outlook vs. Outcome Uruguay Argentina
2018 Outlook vs. Outcome Uruguay Outlook 2018 Outcome Strengthening the convenience format with 8 to 10 Devoto Express store * 5 Devoto express stores opened in 2018 due to the macroeconomic slowdown. openings * Target achieved as margins remained solid despite economic turnaround, Focus on maintain
Slide 27: 2018 Outlook vs. Outcome LatAm
2018 Outlook vs. Outcome LatAm Outlook 2018 Outcome Run rate benefits from synergies of approximately USD120 M, from 28 * Target surpassed: annual run rate benefits from synergies surpassed the initial initiatives across the 4 countries target expected. Targets surpassed: * 10 Cash & Carry stores op
Slide 28: 4Q/FY18 Conclusions
4Q/FY18 Conclusions • Net Sales growth in all countries (1). • Annual consolidated Recurring EBITDA margin gained 40 bps to 5.7% (2) despite a challenging macro and political environment in the region. • EPS grew by 28.3% in 2018 versus last year. • Net Debt/EBITDA ratios: 1.23x and 3.11x at the con
Slide 29: 2019 Outlook
2019 Outlook Colombia Retail expansion of 18 to 20 stores (from openings, conversions and remodelling), including at least 5 Éxito WOW, 5 Carulla Fresh Market and 10 Surtimayorista stores. Revenue growth from retail and complementary businesses (mainly related to Real Estate contribution). Ove
Slide 30: Appendices
Appendices 30
Slide 31: 4Q/FY18 Debt by Country and Maturity
4Q/FY18 Debt by Country and Maturity Net debt breakdown by country 31 Dec 2018, (millions of COP) Colombia Uruguay Brazil Argentina Consolidated Short-term debt 1,173,167 443,963 1,703,232 37,113 3,357,475 Long-term debt 2,895,570 - 4,419,625 - 7,315,195 Total gross debt (1) 4,068,737 443,963 6,122,
Slide 32: FY18 P&L and CapEx by Country
FY18 P&L and CapEx by Country Colombia Brazil Uruguay Argentina Consolidated In COP M FY18 FY18 FY18 FY18 FY18 Net Revenue 11,235,820 40,141,725 2,571,308 1,100,474 55,036,170 Gross Profit 2,803,217 9,391,076 868,617 385,100 13,444,560 % Net revenue 24.9% 23.4% 33.8% 35.0% 24.4% SG&A Expense -2,151,
Slide 33: FY18 SOTP Analysis
FY18 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 11,235,820 651,796 406,866 2,075,156 100% Brazil 40,141,725 2,610,737 1,923,609 2,396,248 18.7% 3,389,320,093 Uruguay 2,571,308 198,127 171,3
Slide 34: FY18 Consolidated Balance Sheet
FY18 Consolidated Balance Sheet Note: Data does include Via Varejo S.A., classified as held for sale. 34
Slide 35: FY18 Consolidated Cash Flow
FY18 Consolidated Cash Flow Summary Consolidated Cash Flow Statement Dec 2018 Dec 2017 % Var (In COP M) Profit (loss) 1,172,944 1,071,066 9.5% Adjustment to reconciliate Net Income 4,314,547 4,974,383 -13.3% Cash Net provided (used) in Operating Activities 3,888,393 2,722,484 42.8% Cash Net provided
Slide 36: 4Q/FY18 Holding P&L
4Q/FY18 Holding (1) P&L Income Statement Almacenes Éxito 4Q18 4Q17 FY18 FY17 In COP M In COP M 4Q18/17 In COP M In COP M FY18/17 Sales 2,964,333 2,921,800 1.5% 10,619,523 10,588,484 0.3% Other Revenue 114,774 96,440 19.0% 401,612 316,474 26.9% Net Revenue 3,079,107 3,018,240 2.0% 11,021,135 10,904,9
Slide 37: FY18 Holding Balance Sheet
FY18 Holding (1) Balance Sheet Holding Balance Sheet Dec 2018 Dec 2017 Var % (In COP M) Assets 15,663,349 15,962,702 -1.9% Current assets 3,914,728 3,273,274 19.6% Cash & cash equivalents 1,885,868 1,619,695 16.4% Inventories 1,398,724 1,111,981 25.8% Accounts receivable 218,109 189,750 14.9% Assets
Slide 38: FY18 Store Number and Sales Area
FY18 Store Number and Sales Area Number of Sales Area Banner by Country Stores (sqm) Colombia Éxito 252 628,593 Carulla 99 87,016 Surtimax 112 58,751 Super Inter 73 66,562 Surtimayorista 18 21,800 Total Colombia 554 862,722 Uruguay Devoto 58 39,886 Disco 29 33,421 Geant 2 16,411 Total Uruguay 89 89,
Slide 39: 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 40: Investor Relations contact
María Fernanda Moreno R. Investor Relations Director +574 6049696 Ext 306560 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 Exch