Slide 1: Corporate Presentation May 2017 (First Quarter 2017 Results)
Corporate Presentation May 2017 (First Quarter 2017 Results)
Slide 2: Ferreycorp at a glance
Ferreycorp at a glance
Slide 3: Highlights
Highlights FERREYCORP Established in Peru in 1922 90+ years of business, 70+ years of alliance with CAT currently operating 17 companies within 10 countries employing a workforce of +6,000 employees Key facts 60% Caterpillar Market Share Market cap (March-2017) ~$600MM Shareholders +2,50
Slide 4: Corporate History
CORPORATE HISTORY 00’s 10’s International Complementary expansion: CAT and businesses other brands 90’s Organizational (economic sectors, development to take business lines) opportunities arising from large mining 80’s Redefining 2016 business: focus on capital goods 2010 70’s Move operations to 200
Slide 5: Corporate Structure
CORPORATE STRUCTURE Caterpillar dealers and Caterpillar dealers and other Other subsidiaries in Perú and allied brands in Peru businesses in Central America abroad Guatemala Chile, Colombia , Ecuador, Perú El Salvador Belice Nicaragua El Salvador, Honduras Sales: US$ 238mm (71%) Sales: US$ 38mm (12%
Slide 6: Strategy: Complete Value Proposition
STRATEGY COMPLETE VALUE PROPOSITION Machinery business Agriculture Services business Automotive Consumables business
Slide 7: Sustainable Business Model: Sales by Line of Business
SUSTAINABLE BUSINESS MODEL SALES BY LINE OF BUSINESS 2,000 US$1.9Bn 1,800 US$1.7Bn US$1.6Bn 1,600 US$1.4Bn 1,400 US$ Million 1,200 1,000 800 600 401MM 400 334MM Spare parts and services 200 10 year CAGR – 13% - 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 1Q16 1Q17 (2006-2016) - Machinery 8% 10
Slide 8: Diverse Customer Base
DIVERSE CUSTOMER BASE 48% OF DELIVERIES COME FROM NON-MINING CUSTOMERS SALES BY ECONOMIC SECTORS 3% 3% 1% 2% 2% 3% 3% 1% 4% 1% 3% 2% 32% 10% 12% 12% 3% 46% 3% 49% 4% 4% 2% 1% 15% 24% 18% 24% 13% 2010 Al 1T2016 Al 1T2017 Open pit mining Underground mining Construction Government Transport Industry, c
Slide 9: Key capabilities
Key capabilities
Slide 10: Key Capabilities
KEY CAPABILITIES Long term strategic partnerships Ubiquitous market coverage Unmatched supply chain and logistics capabilities Financial strength and funding sources In-depth market knowledge Innovation and Technology Ethics and compliance, Corporate Governance and Sustainability
Slide 11: Presence in South and Central America
WITH PRESENCE IN SOUTH AND CENTRAL AMERICA COUNTRIES REPRESENTING BRAND LEADERS 6,515 2016
Slide 12: Market Coverage
MARKET COVERAGE Tumbes Trompeteros Iquitos Talara Jaén Ferreyros: 6 locations in Lima, 17 branches and offices Piura Bagua Lambayeque Cajamarca Tarapoto Unimaq: main location in Lima and branches in Piura, Cajamarca, Lambayeque, Trujillo, Huancayo, Arequipa, Cusco e Ilo. Oficinas en Cerro de Pasco,
Slide 13: Unmatched Logistics Capabilities
UNMATCHED LOGISTICS CAPABILITIES ONE OF OUR MAIN COMPETITIVE ADVANTAGES 890,000 m2 170+ US$120M 365 DAYS TO SERVE OUR CUSTOMERS POINTS OF CONTACT INVENTORY OF PARTS 24x7 OPERATIONS • Operating 50+ warehouses, several located in remote • ISO9002 certification locations (eg: mines) • ISO 14000 certifi
Slide 14: Efficient Logistics Capabilities: Supply Chain Management
EFFICIENT LOGISTICS CAPABILITIES SUPPLY CHAIN MANAGEMENT Ferreycorp integrates and administrates all key elements in the logistic chain as a value proposition Vertical integration through complementary businesses: 1) Freight forwarder (Forbis) and 2) Warehouses and terminals (Fargoline) Efficient ha
Slide 15: Sustainability Model: Stakeholders
SUSTAINABILITY MODEL STAKEHOLDERS • Principles of Good Corporate Governance • Ferreycorp Association • Respect of Shareholders’ rights • “Operadores de equipo pesado • Transparent and timely reporting Ferreyros” Club • Efficient representation with our Board of Directors • Think Big Program • “Jóven
Slide 16: Corporate Standards: Strong Corporate Governance
CORPORATE STANDARDS STRONG CORPORATE GOVERNANCE • Ferreycorp (FERREYC1) is listed in the Lima Stock Exchange BOARD since 1962. • Ferreycorp is included in the Corporate Governance Index of the Dependent Directors Independent Directors Lima Stock Exchange since its inception in 2008. Oscar Espinosa J
Slide 17: Caterpillar Market Share in Peru
CATERPILLAR MARKET SHARE IN PERU Open Pit Mining Heavy Construction Hitachi Liebherr Atlas Copco Hamm Hyundai Bomag 1% 1% 1% 3% Case 2% 2% 1% P&H Doosan 3% Otros 5% Volvo 4% 5% Komatsu Komatsu 7%Deere John 34% Caterpillar 7% Caterpillar 57% 67% US$ FOB values Include shovels Rolling 12 months, Feb20
Slide 18: Financial Performance
Financial Performance
Slide 19: Track Record of Consistent Financial Performance
TRACK RECORD OF CONSISTENT FINANCIAL PERFORMANCE SALES (s/.mm) Gross, Operating and Ebitda margin 5,225 5,333 4,878 4,856 4,611 24.2% 24.3% 24.6% 22.9% 24.0% 20.7% 21.2% 1,385 12.5% 12% 13.5% 1,099 9.9% 11.2% 10.7% 11% 7.5% 9.2% 8.7% 10.4% 7.6% 6.4% 6.9% 2012 2013 2014 2015 2016 1Q16 1Q17 2012 2013
Slide 20: Investment in Assets: Accounts Receivables
INVESTMENT IN ASSETS 1) ACCOUNTS RECEIVABLES ACCOUNTS RECEIVABLES EVOLUTION FACTORING US$ MM US$ MM 30 400 25 350 13 12 20 300 14 10 12 11 14 250 15 200 150 305 324 303 326 10 292 298 281 15.8 100 5 10.8 50 0 0 2012 2013 2014 2015 2016 1Q16 1Q17 1T16 1T17 Short term Long term • Common practice, 30da
Slide 21: Investment in Assets: Inventory and Fixed Assets
INVESTMENT IN ASSETS 2) INVENTORY AND FIXED ASSETS INVENTORY EVOLUTION (US$MM) CAPEX EVOLUTION (US$MM) 602 584 523 55 44 405 30 370 356 370 31 19 23 472 451 3 -11 383 9 5 13 12 13 15 3 284 255 242 28 17 2 247 11 16 11 7 5 3 6 -3 -1 -33 130 133 140 121 115 109 128 2012 2013 2014 2015 2016 1Q16 1Q17 2
Slide 22: Cash Cycle
CASH CYCLE -53 days of accounts payable Targets: Inventory 120 days 3.0x Payable Cash Cycle of 148 days 45 days 73 days of accounts receivable Receivable 45-60 days 127 days of Inventory (2.83x)
Slide 23: Access to Diversified Sources of Financing
ACCESS TO DIVERSIFIED SOURCES OF FINANCING Natural hedge: revenue-debt DIVERSIFIED FUNDING BASE (US$MM) DEBT BY CURRENCY 15 Banks Caterpillar Bonds Soles 2% Quetzales 1T17 285 82 161 US$ 528MM Chilean pesos 4% Dollars 78% 2016 307 53 161 US$ 521 MM - 68 2015 201 93 295 US$ 589 MM DEBT BY RATE - 51 2
Slide 24: Recomposition of Financial Liabilities
RECOMPOSITION OF FINANCIAL LIABILITIES FINANCIAL LIABILITIES (Million of US$) US$ 589 US$ 521 295 161 Bonds 53 Caterpillar Banks 93 307 201 2015 2016
Slide 25: Access to Diversified Sources of Financing
ACCESS TO DIVERSIFIED SOURCES OF FINANCING AVG COST OF DEBT 5.0% 4.65% MATURITY OF FINANCIAL DEBT (US$MM) 4.40% 4.36% 4.20% 4.12% 3.99% 250 225 4.0% 197 200 150 3.0% 2012 2013 2014 2015 2016 1Q17 100 66 FINANCIAL EXPENSES 50 32 6 (AS% OF TOTAL SALES) 0 - 3.0% 2017 2018 2019 2020 2021 2022 2.60% Stra
Slide 26: Leverage Ratio Covenant
LEVERAGE RATIO COVENANT NET DEBT TO EBITDA RATIO ADJUSTED DEBT TO EBITDA RATIO 4.39 2.93 4.08 2.68 2.86 2.59 3.62 3.50 3.53 3.52 3.48 2.37 2.38 2.46 3.33 3.383.27 3.22 3.28 3.21 2.05 2.85 3.06 2.67 2.08 2.76 2.78 2.97 2.56 2.25 2009 2010 2011 2012 2013 2014 2015 2016 1T17 • Adjusted debt: total debt
Slide 27: Profitability Ratios
PROFITABILITY RATIOS 18% 16.0% 16% 14.1% 14.3% 14% 14.1% 13.2% 13.5% 13.20% 12% 12.2% 11.9% 11.8% 11.9% 10.80% 10% 10.2% 10.6% 9.8% 7.7% 8% 7.3% 7.1% 7.7% 7.4% 8.1% 6.3% 6% 5.9% 4.6% 5.5% 5.5% 4% 4.0% 2% 0% 1Q 2015 2Q 2015 3Q 2015 4Q 2015 1Q 2016 2Q 2016 3Q 2016 4Q 2016 1Q 2017 ROE ROA ROIC • ROIC:
Slide 28: Ferreycorp in the Capital Market
FERREYCORP IN THE CAPITAL MARKET SHAREHOLDERS COMPOSITION AS OF MAR 2017 Capital S/. 1’014,326,324 Nº of shares 1’014,326,324 Dividend Yield 2016 (div 0.128457) 7.6% Local pension Foreign Repurchased shares as of Dec 2016 50’208,800 funds investors 23% 35% MAIN SHAREHOLDERS AS OF MARCH17 Peruvian Ho
Slide 29: Dividend Policy: Annual Compliance
DIVIDEND POLICY ANNUAL COMPLIANCE In 1997, the company´s shareholders approved the dividend policy. A modification was approved to assign minimum and maximum ranges. Cash dividends will amount to 5% of the capital or a ceiling equal to 60% of freely available profits. The remainder will be capit
Slide 30: Contacts
Contacts Corporative Finance Manager: Patricia Gastelumendi Treasury Manager: Liliana Montalvo Investor Relations Executive: Elizabeth Tamayo