Grupo Rotoplas Sab De Cv · BMV:AGUA
Grupo Rotoplas Sab De Cv — Q3 2019 Earnings Presentation
32 slides from Grupo Rotoplas Sab De Cv's earnings presentation, 2019
Slide 1: Corporate Presentation Third Quarter 2019
Corporate Presentation Third Quarter 2019 /potop!2s:
Slide 2: Disclaimer
/potopl2s: The contents of this presentation, including text, graphics, images and other materials (“Content”), here contained, is for general information purposes only. While we endeavor to keep the information up to date and correct, Grupo Rotoplas, S.A.B. de C.V., makes no representations or warr
Slide 3: Investment Considerations
Investment Considerations WATER A nascent industry of opportunities Market leaders ? PROVIDING SOLUTIONS 3 WITH A CLEAR PURPOSE Sustainable long-term model “more and better water” 4 5 6 WHERE WE ARE GOING Growth and value opportunities STRONG FINANCIALS Sustainable focus WHY OWN AGUA? Momentum MEMBE
Slide 4: Water: A nascent industry of opportunities
WATER A nascent industry of opportunities
Slide 5: Population Growth and Water Supply
Population Growth 2020 2050 Rural 3.0B 3.0B Total 7.0B 10.0B for non-agricultural uses increases than the population General population will grow by an average of acts and Trends. UN Water. Water Supply Imbalance in water distribution ] O countries control 6 O of the global fresh water supply na 4 P
Slide 6: Water Challenges for Sectors of Interest
Water Challenges for Sectors of interest for Rotoplas: Humanity people worldwide of the world’s population Water scarcity & live without access to live in areas that have water scarcity adequate sanitation services at least once a month quality Water management & Market Size & Dynamics recycling bil
Slide 7: Case Study — Mexico City
Case Study — Mexico City ior “Nowadays, 40% of inhabitants have problems Awl regarding water access and quality” Poor quality ie. Nowadays in Tlalpan neighborhood the local government spends US$7M annually in water trucks CDMxX International Airport * The city's water system provides 8% of the suppl
Slide 8: Providing Solutions: Market leaders
PROVIDING SOLUTIONS Market leaders
Slide 9: The Company
The Company 1994 Storage Products () 1 country 800 direct clients 500 employees 3,000 points of sale 2 product lines 8 plants 1 innovation and development center Sales MXN 500mm EBITDA MXN 70mm Compared to 1994. 2.CAGR 2006 ~ LTMI9 2018 Water Market Leader 0 14 countries (14x)! 10,800+ points of ser
Slide 10: Decentralized Water Solutions | Business Model
; . ; Apotopls-. Decentralized Water Solutions | Business Model Rotor TODAY ------------------ 2-2-2022 22-22-55 --------- » EVOLUTION Products Services B2D @ Water Purifying e-commerce : mA - “e Residential e@ Commercial e Schools Storage @ Water flow ® “e Treatment & heating e Water treatment B2B
Slide 11: Portfolio | Products and Services
Portfolio | Products and Services PRODUCTS SERVICES . STORAGE PURIFICATION Revenue by Solution omis _ ly) a= i Services 7% Cpe fos = $ i, 77 F Water Tanks Cisterns Industrial Other { = Residential Institutional WATER FLOW —_ e P ll, BF PHO Products 93%, Pipes Valves Pumps Catch Pits Drinking Water F
Slide 12: Favorable Growth Drivers | Tailwinds
y Favorable Growth Drivers | Tailwinds /potoplas:. Storage Rapid urban growth = supply interruption > higher demand for water storage products Water demand > centralized system capacity (old infrastructure and poor city planning) an Growing trend of circular economy - use of recycled resins in water
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Slide 14: With a Clear Purpose
WITH A CLEAR PURPOSE Sustainable long-term model “more and better water”
Slide 15: Competitive Advantages
Competitive Advantages - Value - Quality - Social Responsibility + Over 27,500 points of sale in America + Over 18,000 points of treatment, recycling and purification Source: Rotoplas. Information as of December 2018. ER OVATION /potopls bt + Focus on ESG (Environmental, Social & Governance) - Opera
Slide 16: ESG focus
ESG focus /potopls:. sy Q QQ +24,000 hrs! training collaborators on human rights, processes, health and safety, among other topics 53% independent By Board Members Audit, Compensation and Corporate -& Practices Committees chaired by independent Board Members GOVERNANC S +7,800! oy plumbers trained a
Slide 17: Best Corporate Governance Practices
Best Corporate Governance Practices Board of Directors 4) Audit Committee Compensation Committee ES) =J © ag CY) | Corporate Practices Committee Sustainability Committee Our board of directors: /potoplas:. Transparency Diversity Innovation Equality Experience 53% Independent Members 5 international
Slide 18: Where We Are Going
WHERE WE ARE GOING Growth and value opportunities
Slide 19: CEO quote on ROIC greater than WACC
“.throughout this transformation effort, Rotoplas should achieve a ROIC greater than WACC in less than 18 months” Carlos Rojas | CEO Flow’s program kick off August 2019
Slide 20: Flow | Transformation Program
Flow | Transformation Program 3) otoplas:.. A. Enhance performance of current portfolio * Revenue levers 1) Price & volume optimization * Cost levers 1) Procurement of materials 2) Manufacturing efficiency 3) Distribution costs optimization + Working capital levers 1) Inventory levels optimization 2
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Slide 22: Water-as-a-Service Platform
Water-as-a-Service Platform 7A0 years contract WWTP Wastewater treatment and recycling plants Mega Trends ) Vy ; /potoplas:. 7 Sytesa.w \ a x Building and leasing 4 Operation and Treated Water reuse & j Water maintenance wastewater q ERIN discharge to sewage On-site treatment & recycling - the futur
Slide 23: E-commerce platform in the USA
E-commerce platform in the USA The platform: /», a) \ #1 online retailer of water storage products Access to a nationwide manufacturing footprint through Tank Co. strategic alliance Innovation in the water space (storage, septic) to address the pressing needs Order online and pick up purchases at ou
Slide 24: Improve discipline in Capital Allocation
Improve discipline in Capital Allocation Resource allocation for: & SZ Organic growth Inorganic growth Share buybacks Coherence matrix approach Geo [Fe Process: Project proposal Evaluation /potoplas: Dividend Payment Debt Payment any] afl Validation and Quarterly status authorization update Supporte
Slide 25: Strong Financials
STRONG FINANCIALS With a sustainable focus
Slide 26: Track Record of Growth and Profitability
Track Record of Growth and Profitability /potoplas: aS... Revenue by Country Revenue by Solution MXN mm MXN mm CAG CAGR: 8.9% $8,017 : $7,859 $8,017: $6,660 H | . 1% H s5700 / = on $6.860 / ME Products 7 3 ‘ razil 1 oe $5,353 20% vx BH other $5,700 ssass I Services 28% 4% 4% . - H 20% : Argentina :
Slide 27: Sound Financials
Sound Financials MXN mm Debt amortization calendar 80% $2,400 20% $600 2019 2020 2027 Interest coverage* 7.6X 7.2x 5.7x 5.6x 4.7x 2015 2016 2017 2018 LT™ “Considers interest payments from interest bearing liabilities. “interest coverage: EBITDA/Interest payments 2 /potop!as:. Strong Balance Sheet to
Slide 28: ROIC vs Cost of Capital
ROIC vs Cost of Capital 23.3% 174% 71% 73% 7.3% ROIC: LTM NOPAT / Average invested Capital t, t Improvement in ROIC generating an inflection point derived from: 6) Q wy Low return asset divestment strategy Optimization of working capital \ Greater productive efficiency in the manufacturing proc \ St
Slide 29: Why Own AGUA? Momentum
6 WHY OWN AGUA? Momentum
Slide 30: Business Model Resilience
Business Model Resilience 0) Continuous growth ©) Double digit margins (O)Strong Management Mexico — 41 years Central America — 23 years Peru — 21 years Argentina - 21 years Brazil — 20 years USA — 5 years Sales Rotop2e 4.5x CAGR: 12.3% 7859 8. 7 6551 6,660 5,399 8700s o53 4,680 3,049 2.415 2,659 il
Slide 31: EV/EBITDA to growth
EBITDA CAGR EV/EBITDA to (18e-22e) growth GEBERIT EV/EBITDA to growth AQUA VENTURES TORO FLOWSERVE XYLEM EVOQUA COWAY FLUIDRA AGUA 2018-2022 EBITDA CAGRe
Slide 32: rotoplas.com
~ rotoplas.com & Rotoplas SIPs Rotoplas Mexico nn) Rotoplas 9 01800 506 3000