Parque Arauco S.a. · BCS:PARAUCO
Parque Arauco — Investor Presentation (August 2016)
31 slides from Parque Arauco's investor presentation, August 2016
Slide 1: Investor Presentation August 2016
1 Investor Presentation AUGUST 2016 CONTACTS SARAH INMON (HEAD OF INVESTOR RELATIONS) | EDUARDO PEREZ MARCHANT (CORPORATE FINANCE MANAGER) - 1| EMAIL: TEL: (562) 22990510 - IR@PARAUCO.COM
Slide 2: Disclaimer
2 disclaimer This document has been prepared by Parque Arauco for the purpose of providing general infor- mation about the Company. The Company assumes no responsibility for, or makes any represen- tation or warranty, express or implied, with respect to, the accuracy, adequacy or completeness of the
Slide 3: Introduction
3 INTRODUCTION OUR OPERATIONS INVESTMENT HIGHLIGHTS FUTURE DEVELOPMENTS - 3 -
Slide 4: Parque Arauco at a glance
INTRODUCTION Parque Arauco at a glance parque arauco OPERATIONAL METRICS BY COUNTRY Parque Arauco is the third largest shopping center operator in Chile and Peru Peru, and one of the main players in Colombia. 42.8% Peru 31.3% Indicator/ Country CHILE PERU COLOMBIA TOTAL Colombia Total GLA (m2)1 420,
Slide 5: In the last five years Parque Arauco has doubled GLA, revenues and EBITDA
5 INTRODUCTION In the last five years Parque Arauco has doubled GLA, revenues and EBITDA GLA(1) m2 1982 Parque Arauco Kennedy opens as first shopping center in Chile 1995 Parque Arauco S.A. IPO +1.8 X 2006 Parque Arauco expands into Peru with the purchase of a 45% stake in MegaPlaza Norte in Lima 87
Slide 6: Revenue type and contract duration
INTRODUCTION Revenue type and contract duration FIXED VS VARIABLE RENTAL REVENUES as of March 31, 2016 CONTRACT LENGTH (BASED ON º/º OF revenues) Other Revenues 16% 84% Rental Revenues 43% 100% 8% Variable Revenues 8% 15% 41% ‹2 YEARS 2-3 YEARS 3-4 YEARS ›4 YEARS TOTAL 85% Fixed Revenues OUR RENTAL
Slide 7: Our Operations
7 INTRODUCTION OUR OPERATIONS INVESTMENT HIGHLIGHTS FUTURE DEVELOPMENTS - 7 -
Slide 8: Portfolio
8 OUR OPERATIONS Portfolio Parque Arauco has iconic shopping centers in Chile, Peru and Colombia PARQUE ARAUCO KENNEDY - CHILE ARAUCO MAIPÚ - CHILE LARCOMAR - PERÚ PARQUE ARBOLEDA- COLOMBIA MEGAPLAZA NORTE - PERÚ ARAUCO ESTACIÓN - CHILE - 8 -
Slide 9: Portfolio: Chile
9 OUR OPERATIONS Chile Portfolio Parque Arauco has 6 regional shopping centers, 4 outlets and 13 strip centers in Chile. the average age of the portfolio is 17 years. Owned GLA Year of GLA (m2) % Ownership Occupancy (m2) incorporation Parque Arauco Kennedy 116,500 100% 116,500 97.7% 1982 Arauco Maip
Slide 10: Portfolio: Peru
10 OUR OPERATIONS perú Portfolio In Peru in the company has 6 regional shopping centers and 8 neighborhood shopping centers, 2 outlets and 2 strip centers. The average age of the portfolio is 5 years. Owned GLA Year of GLA (m2) % Ownership1 Occupancy (m2) incorporation MegaPlaza Norte 104,000 50% 52
Slide 11: Portfolio: Colombia
11 OUR OPERATIONS COLOMBIA Portfolio Parque Arauco has 2 regional shopping centers in Colombia and the average age of the portfolio is 5 years Owned GLA Year of GLA (m2) % Ownership Occupancy (m2) incorporation Bucamaranga Parque Arboleda 40,500 55% 22,275 95.6% 2010 Pereira Parque Caracoli 38,500 1
Slide 12: Investment Highlights
12 INTRODUCTION OUR OPERATIONS INVESTMENT HIGHLIGHTS FUTURE DEVELOPMENTS - 12 -
Slide 13: Investment highlights
13 6. 1. Important growth Strong results in a challenging opportunities. macroeconomic environment. 5. 2. Conservative debt investment Country, format and structure and outstanding financial performance. highlights socio-economic diversification. 4. 3. Strong management Strong commercial relationshi
Slide 14: Favorable macroeconomic outlook and attractive industry dynamics
14 STRONG RESULTS IN A CHALLENGING MACROECONOMIC ENVIRONMENT Favorable macroeconomic outlook and attractive industry dynamics Parque Arauco is positioned in countries with strong macroeconomic prospects and underpenetrated shopping center sectors STRONG REAL GDP GROWTH PROJECTIONS… …WITH A STILL REL
Slide 15: Results positive in all three countries despite weaker macroeconomic environment
15 STRONG RESULTS IN A CHALLENGING MACROECONOMIC ENVIRONMENT Inspite of a weaker macroeconomic enviroment, results have been positive in all three countries GLA Tenant sales1 Revenues1 EBITDA12 +3.1% +11.6% +10.5% +12.1% 420,500 983,814 408,000 881,485 95,716 85,191 86,652 75,978 Chile LTM Jun. LTM
Slide 16: Diversification by country, format and socio-economic level
16 COUNTRY, FORMAT AND SOCIO-ECONOMIC DIVERSIFICATION Parque Arauco diversifies its market risks at a country, format, and socio-economic level Country level diversification (º/º revenues) Format level Diversification (º/º revenues) 6.3% 7.4% Colombia Others 31.3% Peru 5.5% Neighborhood 62.4% 87.1%
Slide 17: Market leader in the outlet format in the Andean region
17 COUNTRY, FORMAT AND SOCIO-ECONOMIC DIVERSIFICATION With a 49% market share in Chile, Parque Arauco is the market leader in the outlet format in the Andean region Outlets currently in our portfolio Outlets under construction Arauco Premium Outlet Buenaventura, Chile Arauco Premium Outlet Concepció
Slide 18: Consolidated commercial relationships with well-known tenants
18 STRONG COMMERCIAL RELATIONSHIPS WITH LOCAL AND GLOBAL BRANDS Consolidated commercial relationships with well-known tenants Total GLA Years as a Tenant Malls Country (m2) client CHILE 10 PERU 80.646 23 COLOMBIA CHILE 9 74.686 25 Anchor Sto r e PERU CHILE 6 PERU 68.868 11 CHILE 4 PERU 32.817 24 2 C
Slide 19: Supporting the globalization of brands entering the Andean region
19 STRONG COMMERCIAL RELATIONSHIPS WITH LOCAL AND GLOBAL BRANDS Parque Arauco is supporting the globalization of several brands entering the Andean region NEW TENANTS PARQUE ARAUCO KENNEDY IN THE LAST 5 YEARS: NOMBRE GLA NOMBRE GLA 71% of new GLA leased in Parque FOREVER 21 1,639 ETIQUETA NEGRA 209
Slide 20: Experienced management team and solid corporate governance
20 STRONG MANAGEMENT TEAM AND POLICIES Parque Arauco has an experienced management team as well as a solid corporate governance and sustainability policies Parque Arauco’s administration recent management awards EXECUTIVE VICE PRESIDENT Juan Antonio Álvarez CHIEF FINANCIAL OFFICER CORPORATE LGAL COR
Slide 21: Policy of financing projects with 50% debt and 50% equity
21 CONSERVATIVE DEBT STRUCTURE AND OUTSTANDING FINANCIAL PERFORMANCE Parque Arauco’s policy is to finance projects with 50% debt and 50% equity, and is comfortably within all its covenants Liabilities / Equity Net Financial Debt / Equity < 1.40x < 1.50x 1.15x 1.12x 0.87x 0.89x 0.76x 0.74x 0.81x 0.78
Slide 22: Improved debt rating, eliminated dollar debt, longer liability duration
22 CONSERVATIVE DEBT STRUCTURE AND OUTSTANDING FINANCIAL PERFORMANCE During the last 24 months, the Company has improved its debt rating, eliminated debt in Dollars, and considerably increased the duration of its liabilities IMPROVEMENT IN LOCAL DEBT RATING Liability amortization profile and duratio
Slide 23: Participates in markets with a growing retail market
23 IMPORTANT GROWTH OPPORTUNITIES Parque Arauco participates in markets with a growing retail market GDP Per Person vs. GLA per 1,000 inhabitants1 2,500 USA 2,000 GLA per 1,000 habitants 1,500 Canada AT Kearney GRDI1 window of opportunity 1,000 South Africa 500 Portugal Spain Opening Peaking Maturin
Slide 24: Leading position in Chile and Peru, growing in fragmented Colombian market
24 IMPORTANT GROWTH OPPORTUNITIES Parque Arauco has a leading position in Chile and Peru, and is growing its participation in the fragmented Colombian market TOTAL GLA 1 TOTAL GLA PARQUE ARAUCO MARKET SHARE RANKING (THOUSANDS) (THOUSANDS) 3,500 m 2 421 m 2 12% #3 Chile 2,100 m 2 374 m 2 18% #2 PERÚ
Slide 25: Growth from greenfield projects and M&A
25 IMPORTANT GROWTH OPPORTUNITIES Parque Arauco’s growth has come from greenfield projects and M&A 54,500 873,000 90,000 37,400 132,858 80,242 66% Greenfields 27,676 91,625 576,643 m2 24,595 83,708 55,651 194,745 34% M&A 296,357 m2 Total Total Total Total Total Total Total Total Total Total New Tota
Slide 26: Optionality from expansion of existing shopping centers
26 IMPORTANT GROWTH OPPORTUNITIES One important and sometimes forgotten feature of our business in the optionality related to expansion of existing shopping centers Parque Arauco Kennedy Arauco Maipú Arauco Chillán EXPANSIONS IN 2015 Luxury District Parque Arauco Keneddy 1,000 m2 Arauco Premium Outl
Slide 27: Future Developments
27 INTRODUCTION OUR OPERATIONS INVESTMENT HIGHLIGHTS FUTURE DEVELOPMENTS - 27 -
Slide 28: Future Developments 2016 and Onwards
28 Future Developments 2016 and Onwards Parque Arauco has announced projects that will add 219,000 m2 of GLA over the next few years and will require an investment of US$ 620 million. Estimated Total GLA Owned GLA Investment total Investment Total new projects Type Country Format opening date m2 % O
Slide 29: Parque La Colina progressing on time and within budget
29 Parque La Colina is progressing on-time and within budget and should be inaugurated during the first quarter of 2017 Committed brands: Construction State: Currently building fourth underground level Commercialization state: 45% of the GLA is signed, another 3o% is agreed upon, with contracts in n
Slide 30: Landbank
30 Landbank Total Cost Total Cost name M2 % Ownership (Local Currency) 1 (USD MM) Quilicura 25,486 100% 78,000 3 Buenaventura 115,864 100% 460,000 18 Chicureo 47,614 100% 201,000 8 Los Andes 39,254 100% 115,000 5 Others in Chile 55,577 100% 445,000 18 Total Chile 283,795 100% 1,299,000 51 Parque El
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