Atento S.a. · OTC:ATTOF
Atento — Q2 2018 Earnings Presentation
28 slides from Atento's earnings presentation, Jul 30, 2018
Slide 1: Fiscal 2018 Second Quarter Results
July 31, 2018 na | ; : _ rarTr y | Fiscal 2018 Second Quarter Results Investor Relations Shay Chor shay.choré Felipe Joaquim Martins de Souza felipe.souza@atento-comn
Slide 2: Disclaimer
Disclaimer This presentation has been prepared by Atento. The information contained in this presentation is for informational purposes only. The information contained in this presentation is not investment or financial product advice and is not intended to be used as the basis for making an investme
Slide 3: Business Highlights and Strategic Overview
Business Highlights and Strategic Overview Alejando Reynal, CEO
Slide 4: Fiscal 2018 Q2 Results: Highlighted by Topline Growth and EPS Expansion
Fiscal 2018 Q2 Results: Highlighted by Topline Growth and EPS Expansion * Solid top and bottom line performance (Revenues +7.2%, EBITDA +15.6%, and Recurring EPS +19.9%): Brazil: good top line growth +6.3%. Adjusted EBITDA reflects implementation of operational improvement actions, as highlighted in
Slide 5: Financial Results
Financial Results Mauricio Montilha, CFO
Slide 6: Consolidated: Continued Revenue Growth and Strong EPS Expansion
Consolidated: Continued Revenue Growth and Strong EPS Expansion a2 USS MM Except per share 2018 2017 CC Growth (x) yrD 2018 2017 CC Growth (3) Revenue 473.4 473.7 7.2%| 963.8 941.7 5.8% esiTpa”) 49.1 46.1 15.6%] 988 96.4 6.6% Margin (%) 10.4% 9.7% O.7pp.| 10.3% 10.2% O.1p. Adjusted EBITDA 491 525 15
Slide 7: Brazil: Multisector Continues to Drive Growth
Brazil: Multisector Continues to Drive Growth Highlights a aD © Operating performance in line with expectations CC Growth CC Growth 2018 2017 sy" 2018 «2017 (%) * Despite challenging macro environment and truckers strike * Revenues up 6.3% in Q2 and 4.8% year-to-date 19.1 28.7 7 63.0 -22.2% Multisec
Slide 8: Americas: Continued Strong Momentum Across the Region
Americas: Continued Strong Momentum Across the Region Highlights‘) a 7 * Revenues up 11.0% in Q2 and 10.4% YTD CC Growth CC Growth * Revenues from Multisector up 14.1%, driven by Argentina, 2018 2017 (%)) 2018 2017 (3) Chile and Mexico across several verticals. Year-to-date, 193.5 185.7 11.0%|384.1
Slide 9: EMEA: First YoY Revenue Expansion Since Q1 2017
EMEA: First YoY Revenue Expansion Since Q1 2017 Highlights * Revenues up 2.9% in Q2, first YoY growth since Q1 2017 and third sequential QoQ * Revenues from Multisector up 12.3%, supported by continued increase in non-TEF Telco clients. Year-to-date, Adjusted EBITDA” 110 81 21.5% revenues from Multi
Slide 10: Cash Flow Generation Driven by Recovery of Working Capital
Cash Flow Generation Driven by Recovery of Working Capital Q2 YTD 2018 2017 2018 2017 Operating Cash Flow 61.4 30.0 46.2 40.1 Cash Capex?) (12.4) (10.1) (28.8) (24.2) Income Tax Paid (6.0) (4.4) (10.5) (10.1) Free Cash Flow before Interest and Acquisitions 43.3. 15.4 6.9 5.8 Adj. EBITDA to Cash Conv
Slide 11: Summarizing
Summarizing * Solid top and bottom line performance across the footprint highlighted by: * Robust Multisector revenues growth * Margins in line with short term guidance * and EPS expansion * Ongoing positive evolution from a client & commercial perspective with solutions mix at 26.4% for the period
Slide 12: Appendix
Appendix About Atento Financial Reconciliations Debt Information Glossary
Slide 13: About Atento
Slide 14: Atento at a Glance
Atento at a Glance Company Overview Revenue Diversification Overview = Leading CRM BPO provider in Latin America and the fourth largest globally by revenue 1 Growing end-to-end solutions for clients across all verticals & dedicated digital business unit = Long-standing relationships with blue-chip c
Slide 15: We Have Evolved From A Call Center of Telefonica to LatAm's #1
We Have Evolved From A Call Center of Telefonica to LatAm’s #1 CRM BPO Solutions Provider 1999 2014-Present™ 2017+ += TEF cost center + Public Company Paw | - Pure-play call center + Diversified CRM solutions + Limited geographic scope + #1 playerin Latin America V Strengthen CRM BPO market leadersh
Slide 16: Long-Lasting, Blue-Chip Client Base
Long-Lasting, Blue-Chip Client Base Highest client retention in the market, driven by excellence in service offering Loyal Client Base With Best-In-Class Retention Tech GRBITZ SAMSUNG @. Financial Services 98.7% Client Retention) 10+ year relationship with ~60% of clients 5+ year relationship with 8
Slide 17: We Are The Only Scale Provider of Differentiated CRM BPO Solutions in LatAm
We Are The Only Scale Provider of Differentiated CRM BPO Solutions in LatAm Uniquely Positioned to Capture Digital Growth We Provide End-To-End Customi: The Only Platform to Serve Large Clients Across LatAm 2016 LatAm CRM BPO market share (%) ont Chang, Mexico 25%") 2 13 es s 3 a 3 Colombia Brazil f
Slide 18: Shareholders Structure
Shareholders Structure Post IPO on Oct 2014 Post Secondary Offering on Nov 2017 Bain Capital 62,660,015 Free-float 10,959,496 Total Shares 73,619,511 15.2% 84.8% = Bain Capital m Free-float 48,520,671 Free-float 25,388,385 Total Shares 73,909,056 34.4% 65.6% = Bain Capital m Free-float
Slide 19: Appendix
Appendix
Slide 20: Fiscal 2018 Guidance
Fiscal 2018 Guidance Guidance - FY Consolidated Revenue Growth (CCY) 3% to 6% Adjusted EBITDA Margin Range (CCY) 11% to 12% Net Interest Expense S$40MM to $45MM Cash Capex (% of Revenue) 3.5% to 4.0% Effective Tax Rate impacting Rec. Net Income 35% to 38% Diluted Share Count ~73.9MM shares Cash conv
Slide 21: Adjustments to EBITDA by Quarter
Adjustments to EBITDA by Quarter ($ in millions) Profit/(Joss) for the period Net finance expense Income tax expense Depreciation and amortization EBITDA (non-GAAP) (unaudited) ‘Acquisition and integration related costs Restructuring costs Site relocation costs Financing and IPO fees Contingent Valu
Slide 22: Add-Backs to Net Income by Quarter
Add-Backs to Net Income by Quarter Fecal 2015 Fecal 2016 Fecal 2017 Fecal 2018 (Sin milions, except percentage changes) [a Profit/ (Loss) attributable to equity holders of the parent os 65 174 75 522 (44) (78) (05) 16734 9.0 (37) (101) (89) (035) (17) 40 ‘Acquistion and integration related Coss a ee
Slide 23: Effective Tax Rate
Effective Tax Rate ($ in millions, except percentage changes) Profit/ (Joss) before tax* (2) Profi/(loss) before income tax from continuing operations Fiscal 2015 Fiscal 2016 Fiscal 2017 _Q1 2017 Q2 2017 Qi 2018 Q2 2018 75.4 8.6. 1.0 12.8 3.6 3.9 3.3 (G) Total Add-backs to Net Income (excluding tax
Slide 24: FX Rates
FX Rates FX Assumptions Euro (EUR) Brazilian Real (BRL) Mexican Peso (MXN) Colombian Peso (COP) Chilean Peso (CLP) Peruvian Soles (PEN) ‘Argentinean Peso (ARS) Average Qt 2017_Q22017_Q3 2017_Q42017_ FY 2017 Qi 2018 _Q2 2018 0.81 0.84 325 3.60 1871 19.42 2,858.33 2,838.34 601.97 620.73 324 3.26 1971
Slide 25: Revenue Mix by Service Type
Revenue Mix by Service Type Fiscal 2015, Fecal 2016 Fecal 2017 Fecal 2018 Gee Ges a a Zz Ce = Y a eZ Customer Service “48.7% 48.0% 47.0% 47.9% 47.9% 49.6% 49.7% 50.2% 47.8% 490% 50.2% SLT% 40.2% 47.7% 404% S11 SLO% Sales 18.2% 18.3% 182% 174% 18.0% 16.4% 16.3% 15.3% 17.2% 16.6% 16.3% 18.8% 17.2% 17.
Slide 26: Number of Workstations and Delivery Centers
Number of Workstations and Delivery Centers Number of Work Number of . Service Delivery Stations a) Centers Q2 2018 Q22017 _ Q2 2018 Q2 2017 Brazil 49,770 _47,650 35 33 Americas 38,143 36,533 51 50 Argentina 2) 4,376 4,151 12 12 Central America ®) 2,389 2,334 4 4 Chile 2,612 2,561 3 3 Colombia 8,738
Slide 27: Consolidated Debt and Leverage
Consolidated Debt and Leverage Highlights 2918 [Outstanding] = Leverage ratio of 1.7x Currency Maturity | interest Rate | Balance |%Mix| = Cash and Cash equivalents of $106 MM, and existing SMM 20'18 revolving credit facility of $101MM, of which $96 [senior Secured Notes usD 2022 6.12596 398.9| _ 83
Slide 28: Glossary of Terms
Glossary of Terms Adjusted EBITDA — EBITDA adjusted to exclude the acquisition and integration related costs, restructuring costs, sponsor management fees, asset impairments, site relocation costs, financing and IPO fees and other items which are not related to our core results of operations. Adjust