Atento S.A. · OTC:ATTOF
Atento — Investor Day (2019)
57 slides from Atento's investor day presentation, 2019
Slide 1: Leading the Next Generation CX - Investor Day'19
LEADING NEAT GENERAL IN (x INVESTOR DAY'19 Better Experiences. Higher Value
Slide 2: Agenda
\ \ it cc “™“e Agenda 12:00 pm_ Registration and Lunch 2:45pm _ Financial Strategy & Outlook José Azevedo, CFO 12:45pm Welcome Shay Chor, Corp. Treasurer & Investor Rel. Dir. Carlos Lé6pez-Abadia, CEO 3:10 pm Q&A 12:50pm_ Industry Analysts Fire Side Chat , Carlos Lépez-Abadia, CEO; 3:55pm_ Closing R
Slide 3: Disclaimer
i \ ay Disclaimer This presentation has been prepared by Atento. Theinfor- mation contained inthis presentationis for informational purposes only. The information contained inthis prasen- tation isnot investment or financial product achice and is ottintencied to be used as the basis for making an in
Slide 4: Key Takeaways
~\ Key Takeaways - Get beyond numbers, roadmap how to get there - Leading Next Gen CX -3 Horizon Plan _* Operational improvements j - Next Generation Services and Digital Acceleration New Growth Avenues - Highly talented and seasoned team
Slide 5: Introducing our management team in today's session
Introducing our management team in today’s session Shay Chor Dimitrius de Oliveira José Azevedo Corporate Treasurer & Investor Relations Dir. Brazi| Regional Director Chief Financial Officer Michael L. Flodin Gustavo Tasner Jose Maria Pérez Melber US & Nearshore Regional Director Chief Operating Off
Slide 6: Market and Company Context
~ MARKET AND COMPANY = CONTEXT
Slide 7: An expert view on the customer management market and key industry trends
An expert view on the customer management market and key industry trends
Slide 8: Fire side chat with two leading industry experts
Fire side chat with two leading industry experts Juan Manuel Gonzalez Vice President Analyst Gartner TI Singh is a Vice President with Gartner Research. He is a key member of the Tech CEO Research team and is the lead analyst responsible for customer experience and digital services research, worldwi
Slide 9: Market and Company Context: growth expectations
Market and Company Context ® What are the growth expectations for the customer management market? What will be the nature of this growth? 4.7% 4.8 GLOBAL MARKET LATAM MARKET GROWTH 2020 GROWTH 2020
Slide 10: Key next generation CX services
Market and Company Context What are the key next generation CX services that you foresee will be the most impactful to the market? OMNICHANNEL BACK OFFICE DIGITAL MARKETING HYPER PERSONALIZATION COMPLEX VOICE GIG ECONOMY / WAHA MIX HUMAN AGENT / CHATBOT AGENT PROFILING
Slide 11: Opportunities from fast adoption of next generation capabilities
Market and Company Context What are the opportunities related to the fast adoption of next generation capabilities? Al/COGNITIVE CX CONSULTING ADVANCED ANALITYCS AUTOMATION NATURAL LANGUAGE SERVICES 5G WOES eae BLOCKCHAIN VR/AR
Slide 12: Atento: a strong market leader with a long-term value creation strategy
Atento: a strong market leader witha long-term value creation strategy
Slide 13: Diversified client base and value proposition to become market leader
| Market and Company Context =® We have diversified our client base and value proposition to become a market / leader and now setting foundations to lead the next generation of CX services VALUE - PROPOSITION ‘ REVENUES (s CLIENT BASE OPERATIONAL PLATFORM A999. TEF call center Pure-play call center
Slide 14: Global customer management is a mature yet growing market
— The global customer management is a mature yet growing market, with new revenue streams still emerging Global ou Bn) GLOBAL MARKET GROWTH 2019-2022 ct Conter Outsourcing Services Marker in Latin Amesia ad the Caribbean forcast 2028 Ase Pact ‘Center Outsourcing Martes Opportunity Update rene Meret
Slide 15: Foundations to lead the next generation of CX services
Market and Company Context ——==* Wehave diversified our client base and value proposition to become a market / leader and now setting foundations to lead the next generation of CX services 2020 - ONWARDS New Growth Avenues Ue a oe Geographies/verticals Next Gen Services and & . 2 Digital Acceleratio
Slide 16: End-to-end solutions across the customer lifecycle
Market ond | Company Context = We deliver end-to-end solutions across the customer lifecycle that generate higher value for client companies and better experiences for their consumers ‘ul {} Ls] aC) MARKETING SALES CUSTOMER CARE BACK OFFICE COLLECTIONS NEXT GENERATION SERVICES NEXT ef CAPABILITIES (
Slide 17: Strategic plan: a three-year plan across three horizons
TENTO STRATEGIC. a Athree-year plan executed across three horizons
Slide 18: Leading the Next Generation CX
LEADING THE NEXT GENERATION CX Operational Improvements Transforming the core * Sales Excellence * Operational Excellence * Indirect Cost Optimization Next Gen Services and Digital Acceleration Value offer transformation * High value voice « Integrated multichannel * Automated back office New Growth
Slide 19: Operational Improvements
Operational Improvements Transforming the core
Slide 20: Building operational excellence to inject profitability
Operational) Next Gen Services New Growth , Cuiture Improvements | and Digital Acceleration | Avenues — | Transformation _— Building operational excellence is a must for our business to inject profitability in our P&L i il = ce * Accelerate profitable growth: Sell more, sell better, sell what we wan
Slide 21: New Commercial Model to Sell More, Better and What We Want
Operational Next Gen Services New Growth , Cuiture Improvements | and Digital Acceleration | Avenues | Transformation Soles | Secon | ndest cot freetience | Fxcttence | ptimiration — New Commercial Model to Sell More, a Sell Better and Sell What We Want New Commercial Model ope * Global account mode
Slide 22: Record sales in 2019 at better margins
Operational) Next Gen Services New Growth | Culture Improvements | and Digital Acceleration | Avenues | Transformation Record sales in 2019 at better margins for our strategic services SELL MORE SELL BETTER SELL WHAT WE WANT NIYR® %CM @ Next Generation Services (New In-Year Revenues) (Total Annual V
Slide 23: Operational Improvements
Operational Next Gen Services New Growth Culture Improvements and Digital Acceleration Avenues Transformation Sales Operational Indirect Cost Excellence Excellence Optimization Operational Improvements 1. Sales Excellence 2. Operational Excellence 3. Indirect Cost Optimization 23
Slide 24: Optimizing operations increases contribution margins
Operational) Next Gen Services New Growth , Culture Improvements | and Digital Acceleration | Avenues | Transformation | tietence | fkstence™ | German \ Optimizing operations increases our contribution margins or ok and improves the customer experience CUSTOMER OPERATIONS MOBILIZATION RUN AND AND SE
Slide 25: E2E Automation improving lead time
Operational | Next Gen Services New Growth Culture Improvements | and Digital Acceleration | Avenues | Transformation sole | Szetela cont ‘eetlence — | Emcetence | Optimiration E2E Automation is improving our lead time in 32% over the last 6 months - Agile system integration 90 ~--- 8 (@@ DEPLOYMENT
Slide 26: Predictive Agents recruitment processes
Operational Next Gen Services New Growth , Culture Improvements | and Digital Acceleration | Avenues | Transformation | sale | 2peation | nos cot faellence | Exettence | Optimiraion Predictive Agents Recruitment processes across geos increase skills suitability for the role while reducing selection
Slide 27: Way of Working program improving contribution margin in Brazil
—\ — Way of Working program: Understanding and managing client value allows us to improve contribution margin in Brazil Background: Compensation model was based on # of actual calls received, plus upside on cross sell. However operations were not incentivized on these KPIs Opportunity ‘ CM p.p. Cust
Slide 28: Shared Services Optimization savings
Operational Next Gen Services New Growth , Culture Improvements | and Digital Acceleration | Avenues | Transformation | sos | Spratonat | nes cont faellence | Exettence | Optimiraion Th ~~ Shared Services Optimization will generate savings between $3 to $5 million in ae” Brazil, eliminating redundan
Slide 29: Indirect cost savings of $5 to $7.5 million
Operational Next Gen Services New Growth ) Culture Improvements | and Digital Acceleration | Avenues | Transformation | Ser) Operations! induct Cost pe | Heeeene! || penis, We are transformating our business support structures, generating savings / that can reduce our Indirect Costs between $5 and $
Slide 30: Building financial controls to sustain efficiencies
Operational) Next Gen Services New Growth \ Cuiture Improvements | and Digital Acceleration | Avenues | Transformation soles ‘operations! | inact Cost | Freetence | Btetence | Opeimiraion And building financial controls to sustain these efficiencies TRACK IMPACT ON ACTUALS 4 AVOID SAVING LEAKAGES _
Slide 31: Digital Acceleration: Value offer transformation
Next Gen Services and Digital Acceleration Value offer transformation
Slide 32: Market Trend: shift from voice to digital channels
Market Trend and value-added capabilities, all of which are shaping the industry’s future LatAm Market, revenue forecast by channels Billion USD, percent by subtotal 10.4 Back oncet MM Digital Channel Traditional Channel* New Growth , Culture Next Gen Services | Transformation and Digital Accelerati
Slide 33: Total market in Atento geographies
HIGH VALUE INTEGRATED AUTOMATED VOICE MULTICHANNEL BACK OFFICE U$ 8.9 Bn TOTAL MARKET IN ATENTO GEOGRAPHIES U$ 2.9 Bn U$ 2.7 Bn
Slide 34: Driving Digital Acceleration
\ \ Operational Next Gen Services New Growth , Culture \ / | Improvements ana Ligital Acceieraton | Avenues | Transformation ee ee y \ | Seruees Capote” | rosuersroetory // \ Al oS F ‘ ij > Driving Digital Acceleration elton alicia 2 Ly Dual-speed transformation, with digitalization to achieve Al/CO
Slide 35: End-to-end solutions across the customer lifecycle
Operational Next Gen Services New Growth , Culture Improvements and Ligtal Acceleration | Avenues | Transformation | NettGenerotin | Ned Generation | Innovation and New seruies Capabitties | Procuets Factory _ We deliver end-to-end solutions across the customer lifecycle that generate higher value f
Slide 36: AI/Cognitive
Operational Next Gen Services and New Growth Culture Transformation Improvements Digital Acceleration Avenues Next Generation Next Generation Innovation and New Services Capabilities Products Factory AI/Cognitive Artificial Intelligence to deliver sentiment analysis and more humanized customer intera
Slide 37: Analytics
Operational Next Gen Services and New Growth Culture Transformation Improvements Digital Acceleration Avenues Next Generation Next Generation Innovation and New Services Capabilities Products Factory Analytics Data Science to improve business efficiency by generating value through Data. CAPABILITY VAL
Slide 38: CX Process Consulting
Operational Next Gen Services and New Growth Culture Transformation Improvements Digital Acceleration Avenues Next Generation Next Generation Innovation and New Services Capabilities Products Factory CX Process Consulting Optimizing customer journeys and business processes to provide differentiated C
Slide 39: Automation
Operational Next Gen Services and New Growth Culture Transformation Improvements Digital Acceleration Avenues Next Generation Next Generation Innovation and New Services Capabilities Products Factory Automation Automating redundant Back and Front-office work to improve efficiency and customer experience
Slide 40: Innovation and New Products Factory
Operational Next Gen Services New Growth , Culture | Improvements anc Digital Acceieraton | Avenues | Transformation [Next Generation | Next Generation | Innovation and New Services Capabilities Products Factory Innovation and New Products Factory New product generation / solution productization Sou
Slide 41: Product Marketing Process
| eee | New Growth Culture Improvements and Ligtel Acceleration | Avenues | Transformation eS eS ee Senices Capabitties Products Factory 3@ Product Marketing Process Productizing existing customer services and priorization based on potential revenue and margin, as well as product scalability ALREADY
Slide 42: Assets Development with strategic providers
n Services New Growth , Culture talAcceleration | Avenues | Transformation Operational Next | Improvements and Li [Next Generation | Next Generation | Innovation and New Services Capabilities Products Factory += @ Assets Development with strategic providers we Building in-house assets with our strat
Slide 43: Monitoring the transformation impact
Operational Next Gen Services New Growth , Culture | Improvements anc Digital Acceieraton | Avenues | Transformation | Sewienroten | wed Generation | Inevtion and New Services Capabilities Products Factory How we are monitoring the transformation impact Focus on improving service mix with higher mar
Slide 44: Building upon stronger foundations to unlock new growth
Building upon stronger foundations to unlock and accelerate new growth
Slide 45: New Growth Avenues
New Growth Avenues Building upon stronger foundations to unlock and accelerate new growth | GEOGRAPHIES Operational | improvements NEW VERTICALS/ VERTICAL SPECIFIC SOLUTIONS Deeper penetration of Accelerate penetration US market, explore other + of high growth/margin ‘ potential geographies ACCELERA
Slide 46: Geographic Expansion
Geographic Expansion Focus on capturing additional US opportunities and increasing attractiveness as global player $130B MARKET BY 2025 f North America i 2018 $78.7B ‘ 2025 $1308 7.6% CAGR (2019-25) ny . on “ REGION 2018 2019 2020 2021 2022 2023 2024 2025 CAGR NoRTH. NORTH | 78.71 83.94 89.94 96.36
Slide 47: Delivering service for US clients drives EBITDA of 18-20%
Operational Next Gen Services New Growth , Culture | Improvements | and Digital Acceleration | Avenues — | Transformation Geographic Expansion 1 GEOGRAPHIES Delivering service for US based clients in Central and South America drives EBITDA of 18-20% Finance Vertical Customer Service a] a tem || 20 a
Slide 48: Born Digital Opportunities
v BORN DIGITAL OPPORTUNITIES 48
Slide 49: Accelerator Vehicles
jf \ Operational Next Gen Services New Growth , Culture \ | Improvernents | and Digital Acceleration | Avenues | Transformation /\ \ i _-® Accelerator Vehicles 3 ACCELERATORS Strategic partnerships and select bolt-on acquisitions to accelerate growth strategy Vehicle Type Main Objectives Enhance val
Slide 50: People, Our Key Asset
Operational Next Gen Services New Growth Improvements | and Digital Acceleration | Avenues Culture Transformation People, Our Key Asset
Slide 51: Employee Experience
Operational) Next Gen Services New Growth | Culture | Improvements | and Digital Acceleration | Avenues | Iransformation Employee Experience The best experience 2004-2019 Top 15 for our employees Best Place To Work Our Value Proposition Happy _. Happy as Employer Employees — Customers Se People are
Slide 52: Financial Summary
José Azevedo, CFO INVESTOR DAY'19 FINANCIAL SUMMARY
Slide 53: Focus on Improving Revenue Mix and Profitability
Focus on Improving Revenue mix and Profitability YoY Revenues and EBITDA evolution REVENUE YoY GROWTH 30% 2.5% 2.0% i ai a2 Q3 MULTISECTOR REVENUE YoY GROWTH 9.4% _ a3 RUN RATE EBITDA YoY GROWTH 5.2% im | -13.3% 15.7 % a @e2 @ RUN RATE EBITDA MARGIN YoY GROWTH -1.9 pp. a a2 a3 Mmm EBITDA MARGIN VARI
Slide 54: Mid to Long Term Financial Outlook
Mid to Long Term Financial Outlook Better cost control and improved revenue mix to fuel margin expansion in the next 3 years 11.0% Low-end 2019 Guidance REVENUE GROWTH EBITDA MARGIN EBITDA Margin 1.5-2.0pp. 15pp BS URE Pe Extraordinary items: $25-35M Annual Savings Expected: $15-20M -Rottar Cost Con
Slide 55: Capital Allocation Framework
Financia! Summary Capital Allocation Framework Historical capital returned to shareholders equivalent to 35% of FCF Capital Returned to Shareholders (2017 - Sept 2019) MAINTAINING RETURNING FCF: $125.0M INVESTING HEALTHY CAPITAL TO Capital Returned: 35% INGROWTH BALANCE SHEET SHAREHOLDERS CASH CAPEX
Slide 56: Questions
QUESTIONS
Slide 57: Thank You
THANK YOU