Grupo Argos S.a. · BVC:GRUPOARGOS
Grupo Argos — Investor Presentation (September 2016)
35 slides from Grupo Argos's investor presentation, September 2016
Slide 1: Holding Company with Sustainable Investments in Infrastructure
Holding Company with SUSTAINABLE INVESTMENTS IN INFRASTRUCTURE
Slide 2: Strategy
Strategy Investment focus Searching Allowing Basic sectors Geography of the economy Returns above and industry diversification With natural the cost of capital entry barriers Exploit possibilities within the investment focus Capital intensive Efficient Limit negative effects capital allocation of ec
Slide 3: Our Investments
Our Investments Strategy Architecture STRATEGIC PORTFOLIO In Infrastructure Cement Energy Concessions Real Estate Financial Food Services Roads and Ports Real Estate Urban airports Fund Development 55,3%* 52,5% 54,7% 50% 50% 100% 28,8%** 9,8% • Pure cement player in • Presence in 3 • Road and Airpor
Slide 4: History
History 2005 2006 2007 2009 2011 2012 2013 2014 2015 2016 Entry into concession business through the Expansion in the United States acquisition of a 54.7% through the acquisition of stake in Odinsa Acquisition Martinsburg Plant Lafarge’s assets in West Virginia (US) Divestment of coal mines 1934 Fou
Slide 5: Footprint
» 4th biggest players in the United » 7,752 GWh of energy generated States. » 274 km transmission networks » 14 countries » 20,069 km distribution network » Cement: 21.5 mn tons per year » 2,388 MW of installed capacity : installed capacity » 3 countries » Concrete: 18 mn m3 installed capacity » 570
Slide 6: Strengths
Strengths BOARD OF DIRECTORS SHAREHOLDERS ROSARIO CÓRDOBA (Chairman of the Board) - Independent Grupo Sura - 35,6% MARIO SCARPETTA Independent Grupo Nutresa -12,4% Colombian Pension Funds - 67,2% ANA CRISTINA ARANGO COMMON Colombian Pension PREFFERED Funds - 13,1% International Funds - Independent S
Slide 7: Performance
Performance 230 210 Grupo Argos’ Advantages as a Holding Company 190 170 Correlation among its businesses, enabling synergies 150 130 Access to better financing terms 110 90 Strategic alignment among 70 subsidiaries 50 Optimal resource allocation GRUPO ARGOS CEMARGOS CELSIA IGBC ODINSA
Slide 8: Portfolio Growth
Portfolio Growth 1S2016 2010 BY ASSET VALUE* 52% Cement 2005 21%Land Bank 14,3 COP 76% Cement 13% Energy 10,6 COP 8% Concessions** 4,6 COP billion Cement 24% Energy billion 4% Property billion 3% Other DIVIDEND GROWTH*** 8% CARG ~$280,000 ~$267,000 ~$234,000 ~$250,000 ~$240,000 Cement ~$178,000 Ener
Slide 9: Consolidated Results
Consolidated Results 2Q 2016 January - June Billion COP 2016 2015 Var.(%) 2016 2015 Var.(%) Revenue 3,396 2,850 19 7,452 5,490 36 Costs and Expenses 2,683 2,311 16 5,885 4,387 34 Operating Profit 643 563 14 1,246 906 37 EBITDA 892 765 17 1,854 1,435 29 EBITDA Margin (%) 26.26 26.85 24.89 26.15 Act
Slide 10: Consolidated Results
Consolidated Results Revenue EBITDA EBITDA Margin (%) Billions of COP Billions of COP 8.000 2.000 29% 1.854 36% 7.452 1.800 7.000 1.600 1.435 26,3 6.000 5.490 2016 3.396 1.400 892 23,7 5.000 +19% 1.200 +17% 2.850 1.000 765 4.000 800 3.000 600 26,9 2.000 +54% 4.056 +44% 963 2015 400 25,4 2.640 670 1.
Slide 11: Consolidated Balance Sheet - June 2016
Consolidated Balance Sheet - June 2016 June 2016 Assets Trillions of COP 50 40 Short 14% Term Assets Short term 30 19,6 Long 24%Term Long Investment term 20 41,9 Equity Investments 10 22,4 41% PP&E PP&E Liabilities 0 21% Other, Other, LT LT Assets Liabilities & Equity December 2015 Liabilities Trill
Slide 12: Separate Results
Separate Results 2Q 2016 January - June Billion COP 2016 2015 Var.(%) 2016 2015 Var.(%) Revenue 115 171 -33 282 297 -5 Costs and Expenses 20 75 -73 58 96 -40 Operating Profit 97 113 -14 202 190 6 EBITDA 98 113 -13 213 201 6 EBITDA Margin (%) 85.3 66.0 75.6 67.6 12
Slide 13: Separate Balance Sheet - June 2016
Separate Balance Sheet - June 2016 June 2016 Assets Trillions of COP 20 2 85% Long Term Investment 15 Assets 11% PP&E 10 16 Equity 14 5 Liabilities 4% Short Term 0 Assets Liabilities & Equity 0% Other, LT December 2015 Liabilities Trillions of COP 20 2 73% Long Term Debt 15 Assets 14% Short term Lia
Slide 14: Debt Profile
Debt Profile 600 400 COP 1,55 550 200 390 Long Term Debt 254 108 132 115 Ordinary Bonds 0 BILLION 2016 2017 2019 2020 2024 2029 figures in billion pesos (USD 513 million)* Cost of Individual Debt 3,5x 11,0% 10,82% 10,58% 10,43% 10,5% 10,07% 10,0% 9,58% Debt / Ebitda** 9,43% 9,5% 9,0% January Februar
Slide 15: Cement Business
o Cement arcos BUSINESS rN - GRUPO ARGOS
Slide 16: Strategic focus
Strategic focus Undertaking Strategic Investments Efficiency to Further Enhance Efficiency and Competitiveness #1 or #2 Positions in Key Emerging Leader and Developed Interconnected Markets in the Americas Flexible Operations with Vertical Logistics Integration and Extensive Logistics Network Growth
Slide 17: Competitive advantage
Competitive advantage 2 Competitive Advantages: Well-established Strategically located assets and broad distribution and logistics distribution network network enhances flexibility » U.S. plants provide additional flexibility 27 14 • Efficient cement plants with access Ports/terminals Cement plants
Slide 18: Growth Potential
Growth Potential Perfect fit with our current footprint Reaching an important urban region New assets » 19 % 2.2 M MT Of US total Grinding capacity population 1.6 M MT » + 39 % Clinker capacity Population increase vs. Argos before 8 Terminals acquisition 4 with water access 1.58 M » + 20 bps 5 with
Slide 19: Results
Results REVENUES USD $ million EBITDA USD $ million Margin % 3.000 2.833 2.881 2.656 19% 20% 19% 19% 20% 2.437 18% 18% 19% 18% 20% 2.500 17% 16% 18% 1.955 1.983 600 524 534 553 16% 2.000 12% 440 14% 1.602 1.594 450 369 12% 1.500 329 10% 303 304 284 146 731 300 243 8% 1.000 6% 150 83 4% 500 681 131 2
Slide 20: Energy Business
Energy BUSINESS
Slide 21: Strategic focus
Strategic focus Vertically integrated Generation, transmission, distribution and commercialization Portfolio optimization Increase sources of revenue Asset selection Seeking cash flow stability » Become a major player in large-scale, grid-connected non-conventional renewable energies. Innovation » A
Slide 22: Strategic Outlook
Strategic Outlook Risk diversification » Presence in 3 countries: Colombia, Panama, and Costa Rica » Electricity generating technologies: hydropower, thermal, and wind » Vertically integrated: Hydro, Thermal, Wind History of consolidation Profitability Seeking Acquisition of Termoflores Asset optimi
Slide 23: Results
Results REVENUES USD $ million EBITDA USD $ million Margin % 1.600 1.346 37% 39% 40% 36% 35% 1.276 1.294 600 26% 19% 24% 1.200 500 11% 463 1.001 1.024 447 916 386 414 768 400 343 800 288 300 249 400 200 88 265 420 100 69 82 82 - - 2008 2009 2010 2011 2012 2013 2014 2015 1S16 2008 2009 2010 2011 2012
Slide 24: Concessions: Roads & airports
Concessions Roads & airports
Slide 25: Strategic focus
Strategic focus Portfolio reshaping Focus in optimization of projects and resources Growth opportunities Presence in countries with big infrastructure need Sustainable growth Diversified business lines that guarantee stable cash flow generation and profitability Selective pursue of projects. Efficie
Slide 26: Strategic Outlook
Strategic Outlook History of successful projects in the region that provided entry to new markets History of International Projects Portfolio Reshaping – Value Creation 2000 Autopistas del Nordeste Project, Dominican Republic Long-term infrastructure concessions in two Boulevard Turístico del Atlánt
Slide 27: Portfolio Optimization
Portfolio Optimization Controlling Non - Controlling Controlling Non - Controlling AKF Blv. Atlántico Aut. Nordeste Sta. Marta – Para. Hatovial AKF Blv. Atlántico1 Aut. Nordeste1 Toll roads (under 62% 68% 68% 40% 60% 68% 68% operation) 22% Green Corridor Malla Vial del Meta Pacífico II Vinus Malla V
Slide 28: Results
Results REVENUES USD $ million EBITDA USD $ million Margin % 500 468 41% 42% 54% 460 35% 200 29% 27% 29% 32% 32% 372 392 400 166 162 327 148 300 109 105 217 100 41 200 74 148 59 121 50 42 100 78 40 0 0 2008 2009 2010 2011 2012 2013 2014 2015 1S16 2008 2009 2010 2011 2012 2013 2014 2015 1S16 DIVIDEND
Slide 29: Concessions: Ports
mM j RS Concessions compas| Ports rN - GRUPO ARGOS
Slide 30: Strategic focus
Strategic focus Commitment Provide our clients with the best value proposal World class partners APM and Singapore Port Authority Emphasis Maintain emphasis in security, our employees and sustainable development. Logistics Continually enhance our facilities. Flexibility Single port network multipurp
Slide 31: Growth Opportunities
Growth Opportunities Multi-purpose terminals in the Atlantic and the Pacific oceans allow Compas to serve different multi-purpose industries and markets History of Strategic Alliances Consolidation through strong partnerships Born from the alliance between Southern Port Recognized leaders in providi
Slide 32: Real Estate
Real- Estates SITUM aia PACTIA rN - GRUPO ARGOS
Slide 33: Value creation
Value creation Urban development Real State fund Urban Development ~ 2,000 Ha to develop between Barranquilla and Barú. 35 years of expertise. Land development in Barranquilla: 833 Ha equivalent to 2,5x Central Park in NYC. 416 Ha developed up to 2015. Land development in Baru: 1,180 Ha. Turism pote
Slide 34: Value creation
Value creation Real State fund Real Estate Fund ~ 450,000 m2 GLA Among comericales centers , offices, warehouses , self-storage and hotel. ~ 250,000 m2 in pipeline. COP 2,1 trillion in assets Alliance with Conconcreto. Actual Shareholder structure will reach 50%-50% shareholder structure once Grupo
Slide 35: Contact
Contact ALEJANDRO PIEDRAHÍTA NATALIA AGUDELO Investors Relations Director CFO Grupo Argos Grupo Argos Phone: (57) 4 3198712 apiedrahita@grupoargos.com nagudelop@grupoargos.com 35