Atento S.a. · OTC:ATTOF
Atento — FY2018 Earnings Presentation
30 slides from Atento's earnings presentation, Mar 20, 2019
Slide 1: Fiscal 2018 Fourth Quarter and Full Year Results
March 20, 2019 As Atent Fiscal 2018 Fourth Quarter and Full Year Results
Slide 2: Disclaimer
Disclaimer ‘This presentation has been prepared by Atento. The information contained in this presentation is for informational purposes only. The information contained in this presentation is not investment or financial product advice and is not intended to be used as the basis for making an investm
Slide 3: Strategic Overview
Strategic Overview Carlos Lopez-Abadia, CEO
Slide 4: Personal introduction
Personal introduction Over 1 month on the job ATEWTo 30 years career in technology and consulting Management and operational expertise at the global level Business turnaround and digital transformation track records Previous C level & leadership positions DYE dxctechnology McKinsey&Company > accentu
Slide 5: Initial Observations at Atento
Initial Observations at Atento * Market leader with strong brand awareness and excellent reputation across regions * Solid, long-standing relationships with large base of blue-chip clients * Strong capabilities and solutions and a culture of continuous innovation mainly in Brazil * Talented, energet
Slide 6: Fiscal 2018 Observations
Fiscal 2018 Observations * Atento is delivering growth in the right areas * Operational improvement plan in 1H 2018 in Brazil led to margin recovery in Q3 and strong Q4 overall performance in our flagship operation * Multisector continues to be a growth engine for Atento and now represents 61% of to
Slide 7: Aligning Incentives to Achieve Business Priorities
Aligning Incentives to Achieve Business Priorities Confident in ability to execute against near-term objectives and capture long-term opportunities, improving Atento’s revenue and profit growth trajectory Forecast, results reliability Profitability improvement Speed up next generation services & sol
Slide 8: Financial Results Highlights
Financial Results Highlights Mauricio Montilha, CFO
Slide 9: Q4 and Fiscal 2018 Results Highlights
Q4 and Fiscal 2018 Results Highlights Revenue: delivering growth in the right areas * Consolidated revenues up 4.4% in Q4, fueled by 11.4% growth in Brazil * FY 2018 revenue growth of 4.3% within guidance * Multisector up 6.2% in Q4, with Brazil delivering a 13.0% expansion. In FY 2018, Multisector
Slide 10: Atento Group: Q4 2018 driven by strong result in Brazil
Atento Group: Q4 2018 driven by strong result in Brazil Highlights‘) ° Q42018 * Revenue growth of 4.4% YoY, driven by higher volumes with existing clients in Brazil and new clients in Spain, partially offset by lower volumes from Multisector in Americas Revenues from higher value-added solutions was
Slide 11: Brazil: Strong Revenue Growth with Margin reaching 13.9% in Q4
Brazil: Strong Revenue Growth with Margin reaching 13.9% in Q4 aa 2018 2017 CC Growth Et (6) 11.4%|877.7 944.8 CC Growth (6) 5.9% uss mm 2018 2017 213.2 224.5 295 29.6 99.4 124.7 13.9% 13.2% 0.7 p.p.] 11.3% 13.2% -10.6% Margin -1.9 pop. Operating income/(loss) 41 (0.2) h 1413.7 -88.5% Revenue Mix —
Slide 12: Americas: Lower Revenues and Profitability in Argentina and Mexico
Americas: Lower Revenues and Profitability in Argentina and Mexico Highlights‘) Qa cc Growth * Revenues down 5.7% in Q4 and up 3.5% in FY uss mM 2018 2017 (%)" 2018 2017 * Lower volumes in Argentina, Mexico and Peru, with good showing in Chile * Multisector down 5.0% in the quarter and up 5.4% FY Re
Slide 13: EMEA: Revenue Growth and Margin Expansion
EMEA: Revenue Growth and Margin Expansion cs CC Growth FY ce Growth 2018 2017 (%)") 2018 2017 (%)" Revenue .! 9.3%] 240.9 223.4 2.7% Adjusted EBITDA”) . 195 148 16.5% Margin i 81% 6.6% 15pp. (13.6) NM. Revenue Mix — Q4 2018 Revenue Mix — FY2018 41.5% 39.9% 58.5% 60.1% TEF = Multisector = TEF © Multi
Slide 14: Solid FCF and Robust Balance Sheet
Solid FCF and Robust Balance Sheet Highlights Q4 FY res Cee ow (00S LEU CUE 8° Positive FCF of $41.0 million in Q4 Net Cash flow from/(used in) operating activities 43.8 43.2 81.2 114.7 3 [Netinterest Paid 42 81 488 275 *® Cash flow before interest and acquisitions 3 peli : 78 5.7 20.4 206 of +$45.2
Slide 15: Appendix
Appendix About Atento Financial Reconciliations Debt Information Glossary
Slide 16: :
:
Slide 17: Atento at a Glance
Atento at a Glance Company Overview Revenue Diversification Overview FY ®™ Leading CRM BPO provider in Latin America and the fourth largest globally by revenue ® Growing end-to-end solutions for clients across all verticals & dedicated digital business unit = Long-standing relationships with blue-ch
Slide 18: We Have Evolved From A Call Center of Telefonica to LatAm's #1
We Have Evolved From A Call Center of Telefonica to LatAm’s #1 CRM BPO Solutions Provider 1999 2014-Present() 2017+ + TEF cost center Py Pure-play call center + Limited geographic scope Revenues ($8n) -<20k Workstations a Sources: Company filings, press rele (1) Asof FY 2017 + Public Company + Diver
Slide 19: Long-Lasting, Blue-Chip Client Base
Long-Lasting, Blue-Chip Client Base Highest client retention in the market, driven by excellence in service offering Loyal Client Base With Best-In-Class Retention Tech GRBITZ SAMSUNG iY Financial Services ia | BancoEstado 98.7% Client Retention) 10+ year relationship with ~60% of clients 5+ year re
Slide 20: We Are The Only Scale Provider of Differentiated CRM BPO Solutions in LatAm
We Are The Only Scale Provider of Differentiated CRM BPO Solutions in LatAm Uniquely Positioned to Capture Digital Growth We Provide Differentiated The Only Platform to Serve Large End-To-End Customized Solutions Clients Across LatAm 2017 LatAm CRM BPO market share (%) Mexico 21.5%") Colombia 8.5%!)
Slide 21: Shareholders Structure
Shareholders Structure Post IPO on Oct 2014 Post Secondary Offering on Nov 2017 As of December 31, 2018 Bain Capital 62,660,015 Free-float 10,959,496 Total Shares 73,619,511 15.2% 84.8% = Bain Capital * Froe-float Bain Capital Free-float Total Shares 48,520,671 25,388,385 73,909,056 34.4% 65.6% = Ba
Slide 22: Appendix
Appendix
Slide 23: Adjustments to EBITDA by Quarter
Adjustments to EBITDA by Quarter ($ inmilions) Profit/(loss) for the period Net finance expense Income tax espence Depreciation and amortization EBITDA (non-GAAP) (unaudited) Acquistion and integration related costs Restructuring costs Site relocation costs FFnencing and IFO fees Cortingert Value ln
Slide 24: Add-Backs to Net Income by Quarter
Add-Backs to Net Income by Quarter Fecal 2015 Fecal 2016 Fecal 2017 Fecal 2018 (Sin ions, excet percentage changes) CeO CeO a eS ew A a @ 8 a Ae Profit (toss) attributable to equity hollers ofthe parent 205 65 74 75 522 (44) (78) (05) 167 34 90 (37) (1031) (88) (136) (17) 4031150205, Acquistion and
Slide 25: Effective Tax Rate
Effective Tax Rate (Sn milions, except percentage changes) Profit/(loss) before tax? Fiscal 2015 Fiscal 2016 Q12017 Q2 2017 Q3 2017 QF 2017 Qi 2018 Q2 2018 Q3 2018 Q4 2018 FY 2017 _ FY 2018, 75.4 86 128 3.6 (129)_(46)_ 3.93.39 19.6 (1.0) 33.9 (+) Total Add-backs to Net Income (excluding tax effect)
Slide 26: FX Rates
FX Rates Average Average Average FX Assumptions ar @ @ Qt FY 2016 “QL 2017 _Q22017_G32017_Q42017_ FY 2017_ “1 2018_Q22018 218 QF 2018 FY 2018 Euro (EUR) 091 0.89 0900.93 0.90 oss 091 0850.85.89 OS1 0.84 = 08608885 Brazilian Real (BRL) 391-351-325 3.29 3.48 31632136 3.5 3.19 325 360 «396 3.8L 3.65 ‘M
Slide 27: Revenue Mix by Service Type
Revenue Mix by Service Type Fecal 2015 Fiscal 2016 Fiscal 2017 Fecal 2018 a @¢ G @ iF @ @ GS & WF a 2 ow a a a Customer Service 48.7% 48.0% 47.0% 47.9% 47.9% 49.6% 478% 19.0% 502% —SLI% 82% A7.T% «EA «SLAM ©——S18% 50.6% 50.3% 50.7% Sales 182% 183% 18.2% 17.4% 180% 164% 172% 166% 16.3% 188% 17.2% «17
Slide 28: Number of Workstations and Delivery Centers
Number of Workstations and Delivery Centers Number of Work blab ct poetic Service Delivery Centers (1) 2018 2017 2018 2017 Brazil 49,185 48,933 34 35 Americas 37,610 37,773 52 51 Argentina @) 4455 4,220 12 12 Central America °) 2,424 2,433 4 4 Chile 2,948 2,571 4 3 Colombia 8,477 8,643 10 10 Mexico
Slide 29: Consolidated Debt and Leverage
Consolidated Debt and Leverage Outstanding currency Maturity Interest Rate Balance. % Mix 4Q'18 lsenior Secured Notes uso 2022 6.125% 4000] 87% Braziin Debentures BRL 2023 01+ 3.75% u7| 38 LP + 25% / aL 2020 / 2022 zo] 5% BNDES SELIC+ 2.5% Finance lease payables uso/cop/ar. | 2019 ss| 1% lother borr
Slide 30: Glossary of Terms
Glossary of Terms Adjusted EBITDA — EBITDA adjusted to exclude the acquisition and integration related costs, restructuring costs, sponsor management fees, asset impairments, site relocation costs, financing and IPO fees and other items which are not related to our core results of operations. Adjust