Atento S.a. · OTC:ATTOF
Atento — Q3 2018 Earnings Presentation
28 slides from Atento's earnings presentation, Nov 13, 2018
Slide 1: Fiscal 2018 Third Quarter Results
November 13, 2018 Atento Fiscal 2018 Third Quarter 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: Business Highlights and Strategic Overview
Business Highlights and Strategic Overview Alejando Reynal, CEO
Slide 4: Q3 2018 Highlighted by Brazil margin turnaround
Q3 2018 Highlighted by Brazil margin turnaround * Revenues +0.9% (+4.2% YTD), EBITDA Margin of 10.9%, and Recurring EPS of $0.25 * Brazil: Revenues growth of 2.8% YoY. Strong margin expansion QoQ with Adjusted EBITDA margin up 3.3 p.p. to 11.9%. Brazil turnaround reflects impact of H1 operational im
Slide 5: Brazil turnaround driven by operational improvement plan; Encouraging pipeline
Brazil turnaround driven by operational improvement plan; Encouraging pipeline for Atento’s evolved value offering Brazil’s operations remains at the forefront of Atento’s profitable growth strategy * Evolved value offer: solutions factory based in Brazil accelerating Group's move into digital servi
Slide 6: Financial Results
Financial Results Mauricio Montilha, CFO
Slide 7: Consolidated: Delivering the turnaround in Brazil
Consolidated: Delivering the turnaround in Brazil Highlights * Continued Revenue Diversification * Revenues up 0.9% YoY in Q3, driven by continued growth in a3 CC Growth vu) C Growth M Except pershare 2018 2017 (%) = 2018-2017 (4) Multisector. YTD revenues increased by 4.2% revenue Pe cons * New cli
Slide 8: Brazil: Turnaround Driving Profitability to 11.9% in Q3
Brazil: Turnaround Dri ig Profitability to 11.9% in Q3 Highlights 8 cc Growth « Revenues up 2.8% in Q3 and 4.2% YTD (9%) 2018 2017 * Multisector continued to grow, up 3.4%, fueled by financial services. YTD Multisector revenues up 4.9% ZK |GG35) 720.3 i * Multisector mix up 0.4 p.p. to 70.3% in Q3 2
Slide 9: Americas: 9M 2018 Revenue Growth of 6.5%
Americas: 9M 2018 Revenue Growth of 6.5% a3 D C Growth cC Growth 2018 2017 (95) (56) uss MM 2018 2017 Revenue 174.1 198.4 -1.2%| 558.2 557.5 6.5% Adjusted EBITDA” | 19.7 23.7 -8.6%] 66.8 62.9 11.2% Margin 11.3% 12.0% -0.6 p.p.] 12.0% 11.3% O7pp. Operating jincome/(loss) (2.8) (0.9) -30.9%| 6.75.5 48
Slide 10: EMEA: Strong Profitability Expansion fueled by Multisector Continued Growth
EMEA: Strong Profitability Expansion fueled by Multisector Continued Growth Highlights) « Revenues up 2.1% in Q3 * Revenues from Multisector up 6.8%, supported by continued increase in Non-TEF Telco clients. YTD, aig 55.1 oe Beta 166.9 : revenues from Multisector increased 8.9% Adjusted EBITDA?) | 5
Slide 11: Solid FCF and robust balance sheet
Solid FCF and robust balance sheet Highlights YTD * Positive FCF of $18.0 million in Q3 Q3 2018 2017 2018 2017 Net Cash flow from/(used in) operating activities 27.9 69.8 37.4 71.2 © Cash flow befor terest and acquisitions Net Interest Paid (18.4) 9.1 (44.6) (19.4) 9 436.7 million in Q3 Gniceeerce w
Slide 12: Summarizing
Summarizing * Q3 2018 Highlighted by Brazil margin turnaround and EMEA’s robust performance Brazil turnaround reflects impact of H1 operational improvement plan. Encouraging pipeline for Atento’s evolved value offering. Unimed Rio carve-out increases healthcare vertical market share and T- Systems p
Slide 13: Appendix
Appendix About Atento Financial Reconciliations Debt Information Glossary
Slide 14: Atento
AtTéenwto
Slide 15: Atento at a Glance
Atento at a Glance Company Overview Revenue Diversification Overview '™ 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-chip
Slide 16: We Have Evolved From A Call Center of Telefonica to LatAm's #1 CRM BPO Solutions Provider
We Have Evolved From A Call Center of Telefonica to LatAm’s #1 CRM BPO Solutions Provider 1999 2014-Present™ 2017+ + TEF cost center + Public Company Pies - Pure-play call center + Diversified CRM solutions + Limited geographic scope + #1 player in Latin America ¥ Strengthen CRM BPO market leadershi
Slide 17: 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 SRBITZ B. SAMSUNG incial Services 98.7% Client Retention) 10+ year relationship with ~60% of clients 5+ year relationship with 80%
Slide 18: 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 (%) i-Chi manne, Mexico 21.5%!" Co
Slide 19: Shareholders Structure
Shareholders Structure Post IPO on Oct 2014 Post Secondary Offering on Nov 2017 As of September 30, 2018 Bain Capital 48,520,671 Free-float 24,677,888 Treasury Shares 710,497 Bain Capital 48,520,671 Free-float 25,388,385 Total Shares 73,909,056 Bain Capital 62,660,015 Free-float 10,959,496 Total Sha
Slide 20: Appendix
Appendix
Slide 21: Adjustments to EBITDA by Quarter
Adjustments to EBITDA by Quarter Fecal 2015 Focal 2036 Focal 2037 Focal 2018 (5 tations) a2 @ 7 @ ewe a ew ww wa @ @ Proft/(lss) forthe period nos 65 174 75522, (4) (78) (05) 1673490 (37) GO) (89)_035) 4) 403 ao 16 186 95 157 464 195 292 23 97 178 BO 191. 977 247 935186 29183 income tax eens 56 53 9
Slide 22: Add-Backs to Net Income by Quarter
Add-Backs to Net Income by Quarter Fecal 2015 Fecal 2016 Fecal 2037 Fel 2018 (Sin mons except percentage changes) eee we eee wa a ew ew a @ © ‘oft (Loss) attra to ety holes of the pret 205 65 74 75 522 (44) (78) (05) 167 34 90 (37) (HOA) (89) (136) (LN) 403 Acq ate ion led Cast oS CE z as Aeration o
Slide 23: Effective Tax Rate
Effective Tax Rate ($n millions, except percentage changes) Fiscal 2015 Fiscal 2016 Fiscal 2017 Qi 2017 Q2 2017 Q3 2017 Qi 2018 Q2 2018 Q3 2018 YTD 2017 yTD 2018, Profit/ (loss) before tax? 75.4 36 (0) 128 3.6 (029) 3.93.36. 36143 (C4) Total Add-backs to Net Income (excluding tax effect) 419 68.3 90
Slide 24: FX Rates
FX Rates FX Assumptions Euro (EUR) Brazilian Real (BRL) Mexican Peso (MXN) Colombian Peso (COP) Chilean Peso (CLP) Peruvian Soles (PEN) ‘Argentinean Peso (ARS) Average Average Average a Q B Qt FV 2016 “Q12017_Q2.2017_G3 201704 2017_ FV 2017_ 01.2018 92.2018 93 2018 091 089 090 093 0.90 oof 091 085 0
Slide 25: Revenue Mix by Service Type
Revenue Mix by Service Type Fiscal 2015 Fiscal 2016 Fiscal 2017 Fiscal 2018 ae e 4 Wa eee a ee @ A ar QQ @G Customer Service 48.7% 48.0% 47.0% 47.9% 47.9% 49.6% 49.7% 50.2% 47.8% 49.0% | 50.2% SL7% 48.2% 47.7% 48.4% | SILI% 51.8% 50.6% Sales 18.2% 183% 182% 17.4% 18.0% 164% 16.3% 15.3% 17.2% 166% 16
Slide 26: Number of Workstations and Delivery Centers
Number of Workstations and Delivery Centers Number of Work Bamber of ‘ Service Delivery Stations (iy Centers Q3 2018 Q3 2017 __Q3 2018 Q3 2017 Brazil 49,076 __ 48,052 34 33 Americas 37,220 37,890 52 52 Argentina @ 4,356 4,288 12 13 Central America © 2,358 2,342 4 4 Chile 2,932 2,674 4 3 Colombia 8,4
Slide 27: Consolidated Debt and Leverage
Consolidated Debt and Leverage Highlights 3Q18 [outstanding] Currency Maturity | Interest Rate | Balance | % Mix SMM. 30'18 [Senior Secured Notes ™ USD 2022 6.125% 393.3] 85% Brazilian Debentures, BRL 2023 | _coi+3.75% 162] 4% TP + 25K7 BNDES BRL 2020/2022 | Sree asi 279] 6x| Finance lease payables
Slide 28: 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