Quinenco S.A. · BCS:QUINENCO
Quinenco — Investor Presentation (January 2011)
37 slides from Quinenco's investor presentation, January 2011
Slide 1: January 2011
January, 2011
Slide 2: Overview
Overview Recent Events Financial Results Main Operating Companies Conclusions
Slide 3: Quiñenco Group of Companies
Quiñenco Group of Companies Quiñenco is one of Chile’s largest business conglomerates with US$40 billion in assets under management Companies managed by Quiñenco generated sales revenue of US$4 billion in 2009 The Quiñenco group of companies employs over 22,000 people in Chile and abroad
Slide 4: Quiñenco – Attractive Fundamentals
Quiñenco – Attractive Fundamentals Dominant position Quiñenco’s companies are leaders in their respective in its markets industries Holding has proven track record in value creation evidenced by Proven track record sale of investments of approx. US$ 4.5 bln and gains on sale of in value creation
Slide 5: Ownership Structure
Ownership Structure Mining Luksic Group Chilean Stock 83% Exchanges QUIÑENCO Industrial/ Financial Services 17% Market Capitalization*: US$4.2 billion *As of December 30, 2010
Slide 6: Quiñenco: Main Operating Companies
Quiñenco: Main Operating Companies % Control 61.7% 66.1% 47.7% Banco de Chile CCU Madeco Mkt Cap: US$12.2 bln Mkt Cap: US$3.9 bln Mkt Cap: US$342 mln ¾2nd ranked bank ¾ N°1 Chilean beer ¾Manufacturer of ¾Merged with Citibank producer with 86% copper & aluminum and Chile on 1/1/08 market share flexib
Slide 7: Focused Diversification
Focused Diversification Food & Beverage Food & Beverage Food & Beverage Food & Beverage Food & Beverage Hotels Hotels Hotels Manufacturing Manufacturing Manufacturing Manufacturing Telecom Financial Services Telecom Telecom Financial Services Financial Services Financial Services 1970s 1980s 1990s 2
Slide 8: Chilean Conglomerate – Consolidated Assets by Country
Chilean Conglomerate Consolidated Assets by Country US$38.1 billion Argentina 0.2% Peru 0.1% Chile Chile 85% 99.7% Note: Figures translated from Chilean pesos as of December 31, 2009, at exchange rate of: Ch$507.10= 1US$ Consolidated assets are concentrated in Chile. Investments abroad are all at th
Slide 9: Holdings by Sector
Holdings by Sector Corporate Level Book Value Net Asset Value (US$3.5 bln) (US$5.6 bln) Manufacturing Other 3% 2% Other Cash Cash 3% 42% Beverage & Food 25% Manufacturing 20% 7% Beverage & Food 10% Financial Services Financial Services 38% 50% Note: Market information and book values as of September
Slide 10: NAV & Share Price Trend
NAV & Share Price Trend Note: Market information and book values as of September 30, 2010 NAV: US$5.6 billion Market Cap: US$4.0 billion
Slide 11: Quiñenco – Investment Criteria
Quiñenco – Investment Criteria Î Brand & consumer franchise development potential Î Sufficient critical mass Î Prior operating or industry experience Î Access to strategic partners/commercial alliances/ synergies Î Growth platform or add-on acquisition potential Î Controlling stakes
Slide 12: World Class Strategic & Commercial Alliances
Quiñenco: World Class Strategic & Commercial Alliances Quiñenco partners with world class players to develop its markets & products to take advantage of combined know-how, experience and financial capacity
Slide 13: Value Creation System
Value Creation System Value creation stems from: ■ Acquisitions ■ Restructurings ■ Development & maximization of profitability of business portfolio ■ Divestments Divest Continuous growth of Shareholder value Maximize profitability Acquisition Restructuring Quiñenco has developed a process of value
Slide 14: Corporate Level Transactions
Corporate Level Transactions In US$ mlns SECTOR DIVESTITURE YR SOLD PROCEEDS GAIN ON SALE Financial Services LQIF shares 2010 1,120.5 350.5 Telecom Telsur shares 2010 118.3 18.0 Telecom Entel shares 2009 101.7 68.2 Retail D&S shares 2009 25.8 4.3 Telecom Entel shares 2007 119.0 84.2 Retail Paris/Cen
Slide 15: Acquisitions & Capital Increases
Acquisitions & Capital Increases In US$ mlns ACQUISITIONS Financial Services 2008 Banco de Chile 2.7% 90.5 Manufacturing 2008 Madeco 2.5% 12.0 Retail 2004 Almacenes Paris 11.4% 90.9 Retail 2004 Others 1.0% 25.4 Financial Services 2001 Banco de Chile 52.7% 1,158.5 Financial Services 1999 Banco Edward
Slide 16: Healthy Financial Structure
Healthy Financial Structure Corporate Level Assets Liabilities and SH Equity US$3.5 billion US$3.5 billion Other ST Debt 1% 0.5% Other Cash Liabilities 42% 8% LT debt 3% Min. Interest SH Equity 0.5% 88% LT Investments 57% Leverage = 0.13 As of September 30, 2010 Long-term investments are financed wi
Slide 17: Net Debt Corporate Level (adjusted)
Net Debt Corporate Level (adjusted) In US$ mlns 2006 2007 2008 2009 Sep-10 Debt 739 753 436 345 348 Cash -211 -349 -111 -214 -1,479 Net Debt 528 404 326 131 -1,131 * Adjusted for proportionate share of debt and cash of IRSA (50%), and of LQIF (67.04% in 2008 and 2009, 50% starting April 2010). Note:
Slide 18: Main Indicators Corporate Level
Main Indicators Corporate Level Debt reduction has implied lower leverage High interest coverage Negative net debt LEVERAGE * INTEREST COVERAGE YEARS TO PAY DEBT 5 221 0.45 0.36 2 0.14 0.13 47 0.10 1 03 07 11 0 0 2006 2007 2008 2009 Sep-10 2006 2007 2008 2009 12m sep 10 2006 2007 2008 2009 12m
Slide 19: Dividend Cashflow Corporate Level
Dividend Cashflow In US$ mlns Corporate Level 320 315 280 222 Banco de Chile 240 220 LQIF (additional) 200 CCU 160 Madeco 109 120 Telsur 120 Entel 80 Others 40 0 2006 2007 2008 2009 2010(sept) Note: Figures translated from nominal Chilean pesos at the exchange rate of : Ch$483.65= 1US$ Additional di
Slide 20: Overview
Overview Recent Events Financial Results Main Operating Companies Conclusions
Slide 21: Telsur: Sold to GTD Manquehue
Telsur: Sold to GTD Manquehue Quiñenco signs agreement with GTD Grupo Teleducto on sale of 74.4% of Telsur on December 1, 2009. Price of Ch$341.54 valued Telsur at US$156 million, share of Quiñenco amounted to US$113 million*. Transaction reported Quiñenco a gain of US$17 million* in the first
Slide 22: Citigroup exercises options in LQIF
Citigroup exercises options in LQIF Citigroup exercises both options, reaching a share of 50.0% of LQIF Options materialized on April 30, 2010 with payment of US$1 billion in cash. During 2Q 2010 Quiñenco reported a pre-tax gain of US$310 million arising from exercise of first option, and an i
Slide 23: Overview
Overview Recent Events Financial Results Main Operating Companies Conclusions
Slide 24: Contribution to Quiñenco's Net Income by Segment
Contribution to Quiñenco’s Net Income by Segment In US$ mlns 09/30/2009 09/30/2010 % Change Financial 328.9 494.7 50% Beer & other 158.4 389.6 146% Consolidated Net Income 487.4 884.3 81% Minority Interest (213.8) (337.3) 58% Net Income attributable to Controller 273.6 547.0 100% YTD Sept 2010 Highl
Slide 25: Ch$700 billion in Cash Corporate Level
Ch$700 billion in Cash Corporate Level Significant liquidity grants flexibility to take investment opportunities 100% of the funds are invested in Chile in debt instruments, denominated in local currency, with an average duration of less than a year. Investment portfolio includes repurchase ag
Slide 26: Overview
Overview Recent Events Financial Results Main Operating Companies Conclusions
Slide 27: Banco de Chile – Financial Services
Banco de Chile Financial Services Established in 1893, Banco de Chile has a highly recognized name in Chile 2nd largest bank in the Chilean financial system One of the most profitable banks in terms of return on assets and equity Assets of US$34.4 billion Over 14,000 employees Nationwide
Slide 28: Banco de Chile – Financial Services
Banco de Chile Financial Services (MUS$, as of September 30, 2010) YTD 2010 operating income increased 15% reaching MUS$1,782 due to improved economic ROAE conditions and the favorable effect of positive inflation Net income as of September 2010 was MUS$638, 61% above 2009 results Loan portfol
Slide 29: CCU – Beverage & Food
CCU Beverage & Food Founded in 1850, CCU is the largest brewery and beverage producer in Chile, and the second brewery in Argentina. Assets of US$2.2 billion. Over 5,300 employees. 18 facilities in Chile. 4 facilities in Argentina. Extensive distribution network reaching over 90,000 sale
Slide 30: CCU – Beverage & Food
CCU Beverage & Food (MUS$, as of September 30, 2010) Sales grew 8% during the first nine months of EBITDA by Business Segment 2010 to MUS$1,215 boosted by growth in YTD September 2010 sales volumes Wine Spirits Net income for the period reached MUS$153, 11% 4% 23% less than the previous period,
Slide 31: Madeco – Manufacturing
Madeco Manufacturing Founded in 1944, Madeco is the main Latin American manufacturer of copper and aluminum products as well as flexible packaging. Global presence through exports of a variety of copper and aluminum products to the North American and European markets with over 3,000 customers.
Slide 32: Nexans – Manufacturing
Nexans Manufacturing Nexans is the worldwide leader in the cable industry with 2009 Sales by Origin presence in 39 countries and commercial activities worldwide, after over a century of progress. Headquartered in Paris, France, Nexans produces cables and cabling systems at more than 90 productio
Slide 33: Madeco – Manufacturing
Madeco Manufacturing (MUS$, as of September 30, 2010) Sales as of Sept 2010 grew by 34% to SALES MUS$307 boosted by brass mills and flexible packaging. Net gain was US$6.5 thousand due to a lower non-operating result that offset higher operating income during the period. EBITDA NET INCOME Note:
Slide 34: Overview
Overview Recent Events Financial Results Main Operating Companies Conclusions
Slide 35: General Outlook for Quiñenco
General Outlook for Quiñenco Portfolio Healthy Negative Optimization Financial Net Debt Structure Good performance of main Sound financial indicators High Cash levels operating companies should Well structured Balance Sheet Current debt levels contribute to sustained AA- local rating all
Slide 36: Highlights
Highlights ¾ Proven track record and experience in core business segments ¾ Agility and financial strength allows Quiñenco to take advantage of business opportunities as they arise ¾ Strong shareholder group ¾ Diversified Chile risk ¾ Ability to attract strategic partners and commercial alliances co
Slide 37: Thank you for your attention
QUIÑENCO S.A. Thank you for your attention