Grupo Argos S.a. · BVC:GRUPOARGOS
Grupo Argos — Investor Presentation (June 2017)
31 slides from Grupo Argos's investor presentation, June 2017
Slide 1: Holding Company with Sustainable Investments in Infrastructure
Holding Company with SUSTAINABLE INVESTMENTS IN INFRASTRUCTURE June 2017
Slide 2: Grupo Argos At A Glance
Grupo Argos At A Glance • Only liquid vehicle to invest in infrastructure in Colombia 3 • Strategic focus in Cement, Energy, Road and Airport Regions Concessions • Holding company with a solid and articulated portfolio with 18 USD 16 billion in AUM Countries • With a balanced portfolio in regions, c
Slide 3: Balanced Portfolio With A Focus In Infrastructure
Balanced Portfolio With A Focus In Infrastructure Mkt Cap1 Revenue2 EBITDA2 USD 5.6 bn USD 4.9 bn USD 1.2 bn STRATEGIC - In Infrastructure Cement Energy Concessions 55,3%3 52,5% 98,6% Revenues: USD 2.9 bn Revenues: USD 1.3 bn Revenues7: USD 0.4 bn (+0.3 bn of Opaín) 2016 2016 2016 EBITDA: USD 0.6 bn
Slide 4: Principles of our strategy
Principles of our strategy Investment focus Searching Allowing Basic sectors of the economy Returns above Geography the cost of capital and industry diversification With natural entry barriers Exploit possibilities within the investment focus Capital intensive Efficient capital allocation Diversify
Slide 5: Grupo Argos as a Strategic Architect
Grupo Argos as a Strategic Architect Strategic / Institutional Transformer Focused on the Group's relationship with the Focused on defining the Group's FUTURE exterior • Corporate strategy • Sustainability • Alignment with the competitive strategies of • Stakeholders subsidiaries. • Government / Reg
Slide 6: Long Term Strategy With Emphasis In Profitability
Long Term Strategy With Emphasis In Profitability Growth Profitability 1 1. Acquisitions in the cement business to expand its 11. Strategic capital allocation geographic footprint Divestment of non-core assets Portfolio simplification 2 2. Entry in the power and Concessions businesses in Colombi
Slide 7: Rational Behind the Cement Business
Rational Behind the Cement Business Geographical Environment Cementos Argos’ Strategy 150 Cement Consumption 600 Residential sector is 115 Acquisition of a cement plant in the main driver for Kg / capita 100 400 Martinsburg to become the 4th MM Ton 69 cement demand largest cement producer in the
Slide 8: Rational Behind The Power Sector Business
Rational Behind The Power Sector Business Sector Analysis (Colombia + Panamá + Costa Rica) Celsia’s Strategy Energy consumption growth potential (low per capita Leader in the countries where it operates. consumption). Project Pipeline to capture growth opportunities Hydro (+350 MW) Per Capit
Slide 9: Rational Behind the Road Concession Business
Rational Behind the Road Concession Business Geographical Environment Odinsa’s Strategy Presence in Country Position / 138 Consolidate strategic corridors in Colombia index – Quality of roads developing Global competitiveness Ecuador 24 and the region. countries with a Experience and credentia
Slide 10: Rational Behind the Airport Concession Business
Rational Behind the Airport Concession Business Geographical Environment Odinsa’s Strategy For the next 20 years the Trips per Capita Busiest airports in Colombia and 3.0 6% middle class will grow in about Ecuador to take advantage of the 2.5 5% 2 bn, leveraging the growth of regional traffic gr
Slide 11: Recognition and Solid Commitment to Corporate Governance
Recognition and Solid Commitment to Corporate Governance BOARD OF DIRECTORS SHAREHOLDERS ROSARIO CÓRDOBA (Chairman of the Board) - Independent Grupo Sura - 36% MARIO SCARPETTA Colombian Pension Funds - 64% Independent Grupo Nutresa -12% COMMON PREFFERED International Funds - 9% ANA CRISTINA ARANGO S
Slide 12: Contribution by Business
Contribution by Business Grupo Argos Consolidated Revenues (COP bn) Grupo Argos Consolidated EBITDA (COP bn) US$4.8 bn 16,000 US$1.2 bn 14,553 4,000 3,620 14,000 12,700 3,500 12,000 3,000 2,635 10,000 9,296 2,500 2,225 7,629 1,907 8,000 6,681 2,000 1,616 6,000 1,500 4,000 3,357 855 1,000 2,000 500 -
Slide 13: Leverage ratios healthy and within limits; S&P ratifies AA+
Leverage ratios (separate) healthy and within the limits established by the rating agencies. S&P ratifies AA+ Debt (COP trillions) Leverage Ratios 6% US$526 bn mar-2016 mar-2017 • Indicators within the 1,550 1,577 +2% limits established by 33% risk agencies 38% Max: 5.0x 57% 65% REPOS REPOS 6.0x Bon
Slide 14: Stock Performance
Stock Performance Ticker Market Cap1 ADTV (LTM) 1 Dividend Yield1 GRUPOARG CB COP 17.1 tn Common: USD 1.8 bn (USD 5.8 bn) 1.5% PFGRUPOA CB Common non voting: USD .2 bn Stock Evolution Dividends Paid 150 Dividends Paid Dividends Growth IPC (last year) Growth US$ COP Bn 90 mm 140 300 266 18% 246 130 2
Slide 15: Cement Business
( Cement arcos BUSINESS rN AR - GRUPO ARGOS
Slide 16: Cement and Concrete leader in the Americas
Cement and Concrete leader in the Americas Key Figures (2016) 3 3 Revenue by Geography Revenue by product EBITDA by Geography Regions USA 14 14 Colombia 30% RMC 44% 30% Colombia 36% USA Cement Countries 50% 56% CCA CCA 34% 9,166 20% 9.850 Employees 2016: COP 8.5 bn / US$2,790bn Cement Volume 2016: 1
Slide 17: Results
Results CEMENT VOLUME RMC VOLUME Mtpa Mcmpa 16 14.3 14 14 12.6 11.1 11.5 12 11.4 12 10.8 9.4 10 8.6 10 9.3 7.8 8 7.0 8 5.9 6 6 4 4 2 2 0 0 2010 2011 2012 2013 2014 2015 2010 2011 2012 2013 2014 2015 REVENUES EBITDA Margin % COP $ bn COP $ bn US$2,8 bn 9,000 8,517 7,912 1,800 18% 19% 18% 20% 17% 19%
Slide 18: Energy Business
rN AR - GRUPO ARGOS
Slide 19: Balanced Portfolio in the Power and Distribution Businesses
Balanced Portfolio in the Power and Distribution Businesses Key Figures (2016) Revenue by Geography Revenue by type of generation EBITDA by Geography Wind CCA CCA 3% 18% 25% 3 Hydro Countries Thermo 49% Colombia Colombia 48% 82% 75% 1,600 Employees 2016: COP 1,031 bn 2016: COP 3,795 bn Gx: 54.9% Gx:
Slide 20: Recent Performance
Recent Performance GENERATION GWh REGULATED AND NON REGULATED MARKET SALES GWh 600 9,000 8,129 7,754 8,000 7,135 550 7,000 6,170 6,000 5,039 500 5,000 4,000 450 3,000 2,000 400 1,000 350 - 2012 2013 2014 2015 2016 300 Colombia CCA 1T2012 3T2012 1T2013 3T2013 1T2014 3T2014 1T2015 3T2015 1T2016 3T2016
Slide 21: Concessions: Roads & airports
Concessions Roads & airports
Slide 22: Active transformation in the concession business
Active transformation in the concession business Pacífico II Construction Malla Vial del Meta Assets Under 51% 79% Roads AKF ADN + BTA 3 Countries 60% In Operation 68% Assets OPAIN Quiport Odinsa: Airports 35% 47% 3 highway concessions in Grupo Argos: 30% operations 2 Long-term infrastructure conc
Slide 23: Successful consolidation in the Airport and Road concession business
Successful consolidation in the Airport and Road concession business 2015 End of Year Expected Situation YE2016 Santa Marta AKF BTA Hatovial In Operation Under Construction ADN – Paraguachón. Control in ADN and BTA in AKF Pacífico II 43% 43% 40% 22% D.R. 62% Acquisition of control in Pacifico 2,
Slide 24: Recent Performance
Recent Performance PASSENGERS M pax TRAFFIC 2016 (TPD) 40.0 35.0 5.0 14 5.4 30.0 5.5 5.5 25.0 5.4 5.4 20.0 15.0 30.0 31.0 34 25.0 27.6 9 10.0 20.1 22.4 5.0 0.0 6 2011 2012 2013 2014 2015 2016 Opain Quiport AKF Pacífico II Sta. Marta - Para. ADN + BTA REVENUES* EBITDA Margin % COP $ bn COP$ 1,486 bn
Slide 25: Real Estate
(ib) Real - Estate SITUM | LJPACTIA rN AR - GRUPO ARGOS
Slide 26: Land Bank with cash generation potential
Land Bank with cash generation potential Situm ~2.000 Ha (Barranquilla and Barú) 416 Ha developed up to 2015 2002 2009 Land use: 56% ~ 2.000 Ha to develop between Barranquilla and Barú. residential Land development in Barranquilla: 833 Ha equivalent to 2,5x Central Park in NYC. 31% Land develo
Slide 27: Property Joint Venture with growth potential
Property Joint Venture with growth potential Evolution of Conconcreto and Grupo Argos Pactia 2 Countries GLA m2 (000’) 14 Colombian 31 720 States 433 504 345 258 152 160 89 2010 2011 2012 2013 2014 2015 2016 … 2019 - 2022 Conconcreto Grupo Argos Pactia ~ 500.000 m2 EBITDA CAGR projected 2016 – 202
Slide 28: Concessions: Ports
mM j RS Concessions compas| Ports rN - GRUPO ARGOS
Slide 29: Integrated logistic with strong partnerships
Integrated logistic with strong partnerships 9 Port Terminals Commercial Partnership Port terminals Cartagena Tolú Buenaventura Barranquilla Houston (Operation) Cartagena Buenaventura Boscoal (Buenaventura) Comship Brokers 5 mn tons Handled in 2015 Invest in the modernization a
Slide 30: Recent Performance
Recent Performance REVENUES* EBITDA* COP mn COP mn 180.000 70.000 38% 40% 159.995 34% 160.000 35% 60.000 140.000 127.663 128.687 29% 60.249 50.000 26% 30% 120.000 103.076 US$44 mn 43.819 25% 100.000 40.000 36.521 US$ 15 mn 20% 80.000 26.800 30.000 60.000 15% 20.000 40.000 10% 20.000 10.000 5% - - 0%
Slide 31: Contact
Contact JORGE MARIO VELASQUEZ CEO Grupo Argos jvelasquez@grupoargos.com ALEJANDRO PIEDRAHITA CFO Grupo Argos apiedrahita@grupoargos.com NATALIA AGUDELO Investor Relation Director Grupo Argos Phone: (57) 4 3198712 nagudelop@grupoargos.com 31