Slide 1: Company Presentation / March 2016
Company Presentation / March 2016 1
Slide 2: Quiñenco Overview
Financial Main Operating Conclusions Quiñenco Overview Results Recent Events Companies 2
Slide 3: Ownership Structure
Ownership Structure Minority Shareholders (Chilean Stock Exchanges) 81% 19% Mining Industrial / Financial Services Market Capitalization US$ 3.1(1) billion (1) Market Capitalization as of March 10, 2016 3
Slide 4: Quiñenco
Quiñenco • Quiñenco is one of Chile’s largest business conglomerates with US$71 billion in assets under management • Companies managed by Quiñenco generated sales revenue of US$20 billion in 2014 • The Quiñenco group of companies employs around 69,000 people in Chile and abroad 4
Slide 5: Quiñenco: Main Operating Companies
Quiñenco: Main Operating Companies % Control as of September 2015 51.2% 60.0% 28.9%(2) 65.9% 56.0% 42.4% (3) 100% Mkt.Cap(1): Mkt.Cap(1): Mkt.Cap(1): Mkt.Cap(1): Mkt.Cap(1): Mkt.Cap(1): US$ 750 mln(4) US$ 10.5 bln US$ 1.8 bln US$ 125 mln CSAV: US$ 0.6 bln US$ 0.7 bln US$ 4.0 bln HL(3): US$2.1 bln •
Slide 6: First Class Board and Management
First Class Board and Management Board of Directors Andrónico Luksic C. Jean-Paul Luksic F. Nicolás Luksic P. Andrónico Luksic L. Fernando Cañas B. Gonzalo Menéndez D. Hernán Büchi B. Matko Koljatic M. Chairman Vice Chairman Director Director Director Director Director Director Senior Management • F
Slide 7: Over 50 Years of History
Over 50 Years of History 1957 - 1999 2000 - 2012 2013 - 2014 1957 Sociedad Forestal Quiñenco S.A is 2001 Quiñenco becomes the controller of created. Banco de Chile. 2013 Quiñenco increases stake in Madeco to 65.9%. Madeco divided in Invexans and newco 1960’s Empresas Lucchetti S.A. and Forestal 2002
Slide 8: Focused Diversification
Focused Diversification • Beverage & Food • Beverage & Food • Beverage & Food • Beverage & Food • Beverage & Food • Beverage & Food • Hotels • Hotels • Hotels • Manufacturing • Manufacturing • Manufacturing • Manufacturing • Manufacturing • Telecom • Financial Services • Financial Services • Telecom
Slide 9: Quiñenco – Investment Criteria
Quiñenco – Investment Criteria Brand & consumer franchise development potential Sufficient critical mass Prior operating or industry experience Access to strategic partners / commercial alliances / synergies Growth platform or add-on acquisition potential Controlling stakes 9
Slide 10: Quiñenco: World Class Strategic & Commercial Alliances
Quiñenco: World Class Strategic & Commercial Alliances Beverage & Food Manufacturing Financial Energy Transport Quiñenco partners with world class players to develop its markets and products to take advantage of combined know-how, experience and financial capacity 10
Slide 11: Value Creation System
Value Creation System Quiñenco has developed a value creation system through the professional management of its investments 4 Divest/Retain Continuous growth of shareholder value 3 Max. Profitability Hoteles 2 Restructuring 1 Acquisition •Restructuring and •Develop and maximize •Acquisitions of admi
Slide 12: Corporate Level Transactions
Corporate Level Transactions Quiñenco has carried out various transactions throughout its history, generating US$1.6 billion in profits over the last 18 years from divestments of US$3.7 billion 1,585 853 (1) 663 54 34 Telecom Retail Real estate/Hotels Beverage & Food Utility Financial Services Total
Slide 13: Strong Growth in NAV
Strong Growth in NAV Over the past 11 years, the net value of Quiñenco’s assets has grown at an average compound annual rate of 13% Quiñenco - NAV (MUS$) CAGR(2) (1) 2003 – 2014 6.858 (1) 6.541 Quiñenco’s NAV 12.6% 5.789 (1) 5.351 IPSA 11.9% 5.137 4.943 (1) 3.071 3.275 2.721 1.989 2.028 2.142 1.450
Slide 14: Leading Market Positions
Leading Market Positions The company’s investment strategy allows it to maintain a leading position in all of its business areas and product segments: Business Industry Product Ranking(1) Market Share(1) Loans 2 18% Financial Services Deposits 1 22% Chile (non-alcoholic and alcoholic beverages) (2)
Slide 15: Diversified Investments
Diversified Investments Quiñenco is one of the most diversified holding companies in Chile. During its history it has invested in sectors where it has a recognized track-record and experience in the industry. Investments by Sector Net Asset Value(1) (NAV) (US$ 5.0 billion as of September 30, 2015) (
Slide 16: NAV & Share Price Trend
NAV & Share Price Trend NAV/Share Price Trend as of September 30, 2015 2.500 2.017 2.043 2.077 1.953 1.974 2.000 1.500 1.335 1.400 1.295 1.300 1.280 1.000 500 0 Sep- 14 Dec- 14 Mar- 15 Jun- 15 Sep- 15 NAV per share (CH$) Share price (CH$) Note: Market information and book values as of September 30,
Slide 17: Diversified Revenues and Results YTD September 2015
Diversified Revenues and Results YTD September 2015 Quiñenco has achieved diversified revenues and results, thus generating stable cash flows Aggregate Revenues by Sector (1) Net Income (2) (YTD September 2015) (YTD September 2015, MUS$) Port & Shipping Serv. Financial Services 2% 9% Beverage & Food
Slide 18: Quiñenco Holding: Conservative Financial Structure
Quiñenco Holding: Conservative Financial Structure Long term investments are financed with equity and long term debt in Chilean pesos Assets Liabilities and Equity US$ 5.0 billion as of September 2015 US$ 5.0 billion as of September 2015 Other Liabilities Cash Other 2% ST Debt 5% 1% 1% LT Debt 11% S
Slide 19: Low Financial Corporate Debt
Low Financial Corporate Debt Asset disposals and strong dividend flow have allowed Quiñenco to maintain low levels of debt Net Debt MUS$ 549 381 316 175 54 2011 2012 2013 2014 sep-15 MUS$ 2011 2012 2013 2014 Sept 2015 Debt 545(1) 636 770 820 788 Cash -229 -462 -716 -448 -239 Net Debt 316(1) 175 54 3
Slide 20: Stable Dividend Cashflow
Stable Dividend Cashflow Good operating company performance allows a strong dividend flow to the parent company YTD September 2015 Dividends Composition of Dividends (MUS$) (YTD March 2012) SM SAAM 9% CCU 431 20% 112 118 68 72 Banchile Vida 10% 2011 2012 2013 2014 sep-15 SM SAAM Banchile Seguros de
Slide 21: Quiñenco – Strong Fundamentals
Quiñenco – Strong Fundamentals Dominant position in its markets Quiñenco’s companies are leaders in their respective markets. Proven track record in value Holding has proven track record in value creation as evidenced by sale creation of investments for approximately US$3.7 bln and gains on sale of
Slide 22: Financial Results
Quiñenco Financial Results Recent Events Main Operating Companies Conclusions Overview 22
Slide 23: Sound Results
Sound Results Quiñenco has reported increasing revenues and strong bottom line results Revenues(1) Net Income(2) (MUS$) (MUS$) 5,591 490 4,636 4,136 3,729 3,744 3,087 200 179 168 172 126 2011 2012 2013 2014 sep-14 sep-15 2011 2012 2013 2014 sep-14 sep-15 Note: Figures translated from nominal Chilean
Slide 24: Recent Events
Quiñenco Financial Overview Recent Events Main Operating Companies Conclusions Overview 24
Slide 25: Quiñenco: Tender Offer for Invexans
Quiñenco Tender Offer for Invexans • On December 4, 2014 Quiñenco announced that the Board of Directors approved a Tender Offer for 19.55% of Invexans which was not held by Quiñenco, at a price of Ch$10 per share. The offer started on December 15, 2014, and lasted 30 days. The final result was that
Slide 26: Recent Events: Operating Companies
Recent Events Operating Companies NAV Company Recent Events (% of Total) • In July 2015, Banco de Chile acquired Banco Penta’s loan portfolio, amounting to Ch$588 billion (approximately US$953 million). • As of August 2015, Banco de Chile had gained 64 bp of market share in total loans from 40% Dece
Slide 27: Recent Events: Operating Companies
Recent Events Operating Companies NAV Company Recent Events (% of Total) • On December 2, 2014, CSAV and Hapag-Lloyd announced the completion of the merger of their container ship businesses and became the 4th largest container liner shipping company in the world. CSAV had an initial shareholding of
Slide 28: Recent Events: Operating Companies
Recent Events Operating Companies NAV Company Recent Events (% of Total) • In January, 2015 Quiñenco completed its Tender Offer at a price of Ch$10 per share, reaching a stake of 98.3% in Invexans. 7% • On March 25, 2015, Techpack announced the acquisition of the shares of its subsidiary Alusa held
Slide 29: Main Operating Companies
Quiñenco Financial Recent Events Main Operating Companies Conclusions Overview Overview 29
Slide 30: Banco de Chile
Banco de Chile • Established in 1893, Banco de Chile has a highly • Strategic alliance with Citigroup complements the recognized name in Chile. Bank’s financial services of excellence for its • One of the most profitable banks in terms of customers and gives access to one of the most return on asset
Slide 31: Banco de Chile
Banco de Chile • YTD September 2015 the Bank’s net operating ROAE revenues grew 2.2%, mainly based on higher fee income and increased income from loans, which more than compensated the negative effect of lower inflation on the Bank’s net asset position in UFs. 23,9% 23,3% 23,5% 24,4% 21,4% Loan loss
Slide 32: CCU
CCU • Founded in 1850, CCU is a multi-category branded • Extensive distribution network reaching over 116,000 beverage company operating in Chile, Argentina, sales points throughout Chile & 300,000 in Argentina. Bolivia, Colombia, Paraguay and Uruguay with an • Jointly controlled with Heineken, 3rd
Slide 33: CCU
CCU • YTD September 2015 sales grew by 16% to EBITDA by Business Segment MUS$1,498, reflecting growth in all segments, led by (September 2015) Río de la Plata segment based on higher average prices and volume growth. Other Wine 2% • EBITDA was MUS$279 as of September 2015, up 15% 15.7% from Septembe
Slide 34: Invexans
Invexans • Invexans’ main asset is its 28.63% stake in Nexans, • Invexans now has three directors on the Board, a a leading cable manufacturer with worldwide member of the Compensations and Designations presence, based in France. Committee, and a member of the Strategic • An agreement signed in Sept
Slide 35: Nexans
Nexans • Nexans is a worldwide leader in the cable industry with presence in 40 countries and commercial activities worldwide, after over a century of progress. • Headquartered in Paris, France, Nexans produces cables and cabling systems at more than 90 production sites across 5 continents. • 26,000
Slide 36: Invexans
Invexans Operating Income • YTD September 2015 Invexans’ net income (MUS$) mainly reflects its proportional share in Nexans’ 16 net income for the first semester, which posted a loss of M€58, despite 23% growth in operating results, due to restructuring costs amounting to M€98. -8 -10 -29 2013 2014
Slide 37: Techpack
Techpack • Techpack is a regional leader in flexible packaging, • In June 2014 Techpack acquired the Chilean with presence in Chile, Argentina, Peru and flexible packaging company HYC Packaging, in Colombia. US$34.3 million. • Over 2,200 employees. • The company completed a capital increase raising
Slide 38: Techpack
Techpack Sales • Techpack’s operating income YTD September 2015 (MUS$) grew 37.8% to MUS$19, mostly reflecting the consolidation with HYC Packaging in Chile since June 2014, together with operational 351 372 improvements and cost controls. 278 283 • Techpack’s net income YTD September 2015 was a los
Slide 39: Enex
Enex • Enex S.A. has a network of 451 service stations, Market Share of Liquid Fuel Sales with 120 convenience stores. (December 2014) • Main business activities: Others - Distribution of fuels through its service 8% stations. Petrobras 13% - Distribution of fuels to industrial clients and transport
Slide 40: Enex
Enex • Sales decreased 22.9% YTD September 2015, Sales reaching MUS$1,806, mainly due to lower fuel (MUS$) prices, and also reflecting lower sales in the industrial segment, only partly offset by growth in the retail sector. 3,115 • Operating income fell 33.6% to MUS$29 YTD 2,516 2,343 September 201
Slide 41: CSAV
CSAV • CSAV, founded in 1872, is one of the oldest shipping • In August 2014 CSAV completed a US$200 million companies in the world. capital increase. • Its activities include overseas transport of • On December 2, 2014, CSAV announced the merger of containerized cargo through its investment in Hapa
Slide 42: CSAV
CSAV • YTD September 2015 CSAV’s net income was a gain Sales of MUS$88, a substantial improvement over the (MUS$) same period in 2014, primarily due to a net gain of MUS$88 generated by its investment in Hapag- Lloyd, and losses of discontinued operations 4,796 amounting to MUS$170 reported as of Se
Slide 43: Hapag-Lloyd
Hapag-Lloyd • Hapag-Lloyd is a leading global liner shipping company, with a fleet of 190 modern ships, 7.5 million TEU transported a year and a total capacity of around 1 million TEU. • Founded in 1847 and headquartered in Hamburg, Germany, Hapag-Lloyd offers a global network of 125 liner services.
Slide 44: SM SAAM
SM SAAM • SM SAAM is dedicated to port services and • SM SAAM subscribed, through SAAM, an management of port concessions, including three association with the Dutch company Boskalis to main business areas: port terminals, tug boats, jointly operate and develop the tug boat business and logistics. i
Slide 45: SM SAAM
SM SAAM • YTD September 2015, SM SAAM’s consolidated Sales sales reached MUS$329, down by 11.4%, mainly (MUS$) due to lower sales of logistics and the consolidation 492 of tug boats in Brazil in 2014 only. 448 479 • SM SAAM obtained net income of MUS$37 As of 371 329 September 2015, remaining flat i
Slide 46: Conclusions
Quiñenco Financial Recent Events Main Operating Conclusions Overview Overview Companies 46
Slide 47: Outlook
Outlook Factors that contribute to Quiñenco’s ability to pursue and undertake new investment opportunities Healthy Portfolio Low Level Financial Optimization of Debt Structure • Good • Sound financial • Strong cash levels performance of indicators • Current debt main operating • Well structured leve
Slide 48: Thank you for your attention
Thank you for your attention x & : 448 QUINENCO S.A. 48