Grupo Argos S.a. · BVC:GRUPOARGOS
Grupo Argos — Investor Presentation (November 2022)
42 slides from Grupo Argos's investor presentation, November 2022
Slide 1: Corporate Presentation November 2022
CORPORATE PRESENTATION Corporate Presentation November 2022 1 November 2022
Slide 2: Important Note
CORPORATE PRESENTATION Embalse del Calima Important Note This presentation contains certain forward-looking representations and information related to Grupo Argos and its subsidiaries based on currently known facts, expectations and forecasts, circumstances and assumptions regarding future events. M
Slide 3: Overview of Grupo Argos
CORPORATE PRESENTATION Overview of Grupo Argos Grupo Argos – Established footprint in the region with a robust portfolio focused on infrastructure Business highlights Company snapshot – 3Q 2022 LTM Cement • 12 cement plants and 248 RMC plants in Colombia, the US, CentAm and business line the Caribbe
Slide 4: Grupo Argos business lines at a glance
CORPORATE PRESENTATION Overview of Grupo Argos Grupo Argos – Established footprint in the region with a robust portfolio focused on infrastructure Cement business line Power business line Transportation business line Real estate business line Portfolio Investments 23.1m tons of cement cap. 2.0 GW of
Slide 5: Strategy and Business Segments
CORPORATE PRESENTATION Strategy and Business Segments Cement Infra Portfolio 5 November 2022
Slide 6: Key milestones (1/2)
CORPORATE PRESENTATION Strategy Targeted M&A activity, coupled with deep know-how optimizing existing assets… Cement Infra Portfolio A Cement and energy businesses consolidation B Portfolio optimization towards key business lines and strategic assets (1/2) 2006 - 2008 2009 - 2011 2012 2014 - 2015 Ce
Slide 7: Key milestones (2/2)
CORPORATE PRESENTATION Strategy … has proven to be a differentiated factor generating attractive returns … Cement Infra Portfolio B Portfolio optimization towards key business lines and strategic assets (2/2) C Creation of strategic partnerships and focus on capital optimization 2016 2017 - 2018 201
Slide 8: Unrivaled track record with ample asset management capabilities
CORPORATE PRESENTATION Strategy … resulting in unrivaled track record with ample asset management capabilities Cement Infra Portfolio Key strengths highlighting Grupo Argos positioning 1 2 3 4 5 6 Deep sector and Unique sourcing Strong value creation Asset optimization and Brand reputation with Team
Slide 9: Proven strategy to develop regional infrastructure platforms
CORPORATE PRESENTATION Strategy Proven strategy to develop regional infrastructure platforms Transportation Proven strategy for platform consolidation Energy Real Estate Ports Infrastructure 01. Identify business opportunities Acquisition of Odinsa Acquisition of Colinversiones Land portfolio and re
Slide 10: Main Figures - Accelerated growth in the infrastructure segment
CORPORATE PRESENTATION Strategy Main Figures - Accelerated growth in the infrastructure segment over the last decade Consolidated Revenue Consolidated EBITDA COP bn COP bn + 12% + 12% CAGR 2012 – 2022 (sept L12M) CAGR 2012 – 2022 (sept L12M) 25 6 20.0 → USD 5.0 bn1 5 4.8 → USD 1.2 bn1 20 4 35% 15 3
Slide 11: Consolidated base of infrastructure assets
CORPORATE PRESENTATION Strategy During the last decade Grupo Argos consolidated an important base of infrastructure assets Cement Energy Concessions Real Estate Portfolio Energy ▪ Sura Argos Energy Energy Toll Road Airport Argos USA Transmission Real Estate ▪ Nutresa COL & CCA Generation Commerciali
Slide 12: Simplification of structure and listing in the NYSE
CORPORATE PRESENTATION Strategy Simplification of structure in the infrastructure asset management business model and listing in the NYSE 2 Cement Alternative Asset Manager → Infrastructure Portfolio 1 Energy ▪ Sura Argos Energy Energy Toll Road Airport Argos USA Transmission Real Estate ▪ Nutresa C
Slide 13: Business plan focused on revealing and generating value
CORPORATE PRESENTATION Strategy Business plan focused in revealing and generating value for our shareholders Historic Performance Revealing Value1 Long Term Value Generation2 Figures in USD bn USDCOP = 4,600 (30/09/22) +65% Arbitrage +11% upside TSR CAGR (2002 – 2022) 3.5 +1.4 0.9 2.1 0.5 Grupo Grup
Slide 14: Cement Business
CORPORATE PRESENTATION Cement Infra Portfolio Cement Business 14 November 2022
Slide 15: Main Figures of the Cement Business
CORPORATE PRESENTATION Cement Business Main Figures of the Cement Business Cement Infra Portfolio Geographical Footprint Cement RMC 23.1 16.9 14.7 7.7 million tons of million tons million m3 of million m3 installed dispatched LTM installed dispatched capacity (sep - 22) capacity LTM (sep-22) Financi
Slide 16: CemArgos: EBITDA grows +23% during the third quarter
CORPORATE PRESENTATION Cement Business CemArgos: EBITDA grows +23% (y/y) during the third quarter Cement Infra Portfolio Operational1 Revenues2 COP bn EBITDA2 COP bn 3Q2022 vs 3Q2021 +25% 3Q2022 vs 3Q2021 +23% (A/A) (A/A) 3,118 Cemento RMC 2,851 583 542 6 -1,8% 6.00 2,489 2,537 2,577 509 473 4.2 5 5
Slide 17: Infrastructure Business
CORPORATE PRESENTATION Cement Infra Portfolio Infrastructure Business 17 November 2022
Slide 18: Creation of platforms by asset type
CORPORATE PRESENTATION Infrastructure Business Creation of platforms by asset type Cement Infra Portfolio Professional manager with proven experience operating infrastructure platforms in the region Infrastructure Asset Management Energy Energy Transmission Energy Toll Road Airport Real Estate Gener
Slide 19: Celsia: EBITDA grows 34% y/y
CORPORATE PRESENTATION Infrastructure Business Celsia: EBITDA grows 34% y/y Cement Infra Portfolio Operational1 Revenues1 COP bn EBITDA1 COP bn 3Q2022 vs 3Q2021 +33% 3Q2022 vs 3Q2021 +34% Generación Comercialización (A/A)1 (A/A)1 2,000 +14% 2,000 2 1,309 1,300 455 449 1,620 1,645 1 424 1,800 1,800 1
Slide 20: Odinsa: strong traffic dynamics within toll roads
CORPORATE PRESENTATION GRUPO ARGOS - 3Q2022 Odinsa: strong traffic dynamics within toll roads concessions Cement Infra Portfolio Average Daily Traffic (ADT) - Thousand vehicles IRR (Expected) +21% -6% +0% +8% Malla Vial del Meta 39.2 38.9 38.8 11% 32.5 22% 21.1 22.7 Autopistas del Café 22% 7.1 6.6 1
Slide 21: Odinsa: strong traffic dynamics within airport concessions
CORPORATE PRESENTATION GRUPO ARGOS - 3Q2022 Odinsa: strong traffic dynamics within airport concessions Cement Infra Portfolio Passengers - Millions IRR (Expected) 9.5 18% vs 13% 3Q 2022 3Q 2021 6.1 11% vs 10,0% 3Q 2022 3Q 2021 1.3 0.7 Opain Quiport 3T2021 3T2022 3T2021 3T2022 • Better traffic dynami
Slide 22: Pactia: EBITDA grows 35% (y/y)
CORPORATE PRESENTATION Infrastructure Business Pactia: EBITDA grows 35% (y/y) Cement Infra Portfolio Operational Revenues COP bn EBITDA COP bn GLA 3Q2022 vs 3Q2021 +17% 3Q2022 vs 3Q2021 +35% (A/A) (A/A) 1,400 108 53 52 103 51 98 1,200 88 85 39 1,000 852 805 GLA ('000) 30 800 600 -5% 400 200 0 3T 202
Slide 23: Portfolio Investments
CORPORATE PRESENTATION Cement Infra Portfolio Por tfolio Investments 23 November 2022
Slide 24: Real Estate Business
CORPORATE PRESENTATION Portfolio Investments Real Estate Business Cement Infra Portfolio Development Strategy Value Creation Our Masterplans: Develop roads and public areas, assign areas for urban facilities and areas of environmental Since 2016, the NDU has generated COP 315 billion of net cash flo
Slide 25: Investment in Grupo Sura and Grupo Nutresa
CORPORATE PRESENTATION Portfolio Investments Investment in Grupo Sura and Grupo Nutresa Cement Infra Portfolio Companies and Subsidiaries Long-term Benefits 1. Long-term Profitability ▪ Grupo Sura: +19% CAGR (TSR since 2000) ▪ Grupo Nutresa: +18 CAGR (TSR since 2000) 2. Enabling infrastructure growt
Slide 26: Shareholding Structure - over 15,000 shareholders
CORPORATE PRESENTATION Shareholders Shareholding Structure - The company has over 15,000 shareholders Shareholders 30/06/2022 Cross-Holding Structure 30/06/2022 Shareholding corresponds to political rights Political Rights Economic Rights 29% 28% 27% 36% 10% 36% 657.6 869.5 13% 28%1 million ordinary
Slide 27: Corporate Governance - Board of Directors
CORPORATE PRESENTATION Board of Directors Corporate Governance Board of Directors Rosario Jorge Ana Cristina Armando Claudia Córdoba Uribe Arango Montenegro Betancourt Independiente Independiente Independiente Patrimonial Patrimonial (Presidente de la JD) 1 2 4 3 4 1 4 1 2 Board Committees Recogniti
Slide 28: Financial Results
CORPORATE PRESENTATION Financial Results Cement Infra Portfolio 28 November 2022
Slide 29: The year continues showing a strong operational and financial dynamic
CORPORATE PRESENTATION GRUPO ARGOS - 3Q2022 The year continues showing a strong operational and financial dynamic Cement Infra Portfolio Revenue EBITDA Net Income Controlling Interest Units in COP tn Units in COP tn Units in COP bn Units in COP bn +31% +32% +14% +13% +10% +17% 15.6 3.9 1,052 583 3.4
Slide 30: Cumulative EBITDA reach COP 3.9 tn, +14% YOY
CORPORATE PRESENTATION GRUPO ARGOS - 3Q2022 Cumulative EBITDA reach COP 3.9 tn, +14% YOY Consolidated Summary P&L Quarterly Resulta Cumulative Results for the Year COP bn 3Q - 2022 3Q - 2021 Var.(%) sep-22 sep-21 Var.(%) Revenues 5.088 4.115 24% 15.600 11.875 31% Costos, expenses + other revenues 4.
Slide 31: 24% revenue growth and 9% EBITDA growth (YOY)
CORPORATE PRESENTATION GRUPO ARGOS - 3Q2022 24% revenue growth (YOY) and 9% EBITDA growth (YOY) Consolidated revenue COP bn Consolidated EBITDA COP bn 1,500 6,000 111 10 1,269 4 5,088 1,300 111 278 80 1,159 -83 -19 -20 629 5,000 -7 -12 1,100 4,115 4,000 900 3,000 700 500 +24% +9% 2,000 300 1,000 100
Slide 32: Increased expenditure with improved operational dynamics and inflation
CORPORATE PRESENTATION GRUPO ARGOS - 3Q2022 Increased expenditure associated with improved operational dynamics and effects of inflation Consolidated Expenditure Cementos Argos Expenditure Celsia Expenditure Odinsa + Opain Expenditure +15% +25% +12% -4% 468 272 Odinsa OPAIN 86 92 88 406 77 218 46 68
Slide 33: Reduced indebtedness through financial discipline and divestments
CORPORATE PRESENTATION GRUPO ARGOS - 3Q2022 Financial discipline, cash flow generation and divestments result in reduced indebtedness Consolidated Debt COP bn Net Debt1 COP bn Financial Expenses COP bn 17,059 369 15,710 16,041 1,645 1,053 29 1,381 1,640 -2,401 13,931 23 4,701 2,268 1,115 257 4,317 1
Slide 34: Separated EBITDA grows 8% YOY
CORPORATE PRESENTATION GRUPO ARGOS - 3Q2022 Separated EBITDA grows 8% YOY Separated P&L Summary Quarterly Results Cumulative Results for the Year COP bn 3Q - 2022 3Q - 2021 Var.(%) sep-22 sep-21 Var.(%) Revenues 166 171 -3% 623 580 8% Costs and other expenses 29 15 85% 68 80 -15% SG&A 29 24 21% 131
Slide 35: Separated revenue was COP 166 billion during 3Q2022
CORPORATE PRESENTATION GRUPO ARGOS - 3Q2022 Separated revenue was COP 166 billion during 3Q2022 Revenue distribution 3Q2022 COP bn Variación % (A/A) +999000% -18% n/a -38% +14% +29% +107% -3% ▪ Energy and concessions segments reported higher contribution to the revenues during the quarter, while the
Slide 36: Treasury investments result in a positive carry
CORPORATE PRESENTATION GRUPO ARGOS - 3Q2022 Treasury investments result in a positive carry regarding the cost of debt Cash Flow Notes COP mn COP mn 1 Dividendos netos 482,668 1. Div. received: 700,030 (Odinsa: 360,957). Div. Paid: 217,365 Ingresos NDU 123,948 2. 3,088,365 shares of CemArgos (averag
Slide 37: Cost of debt increases less than inflation thanks to hedging
CORPORATE PRESENTATION GRUPO ARGOS - 3Q2022 Cost of debt increases less than inflation thanks to hedging strategies Indebtedness1 COP bn Maturity profile (capital) COP bn Cost of debt and half-life Vida media (años) Kd (sin coberturas) 0% 0% 17% 26% 7% 10% 0% 28% 0% 12% Kd (Real) IPC 0.17 Bonos Banc
Slide 38: Highest credit rating from Fitch and S&P
CORPORATE PRESENTATION GRUPO ARGOS - 3Q2022 Grupo Argos has the highest credit rating from Fitch and S&P AAA AAA 1 1 Stable Stable June 2022 May 2022 ▪ Credit quality and dividend flow stability even in challenging ▪ Fulfilment of key milestones that enabled debt reductions and environments capital
Slide 39: Sustainability
CORPORATE PRESENTATION GRUPO ARGOS - 3Q2022 Sustainability Grupo Argos is recognized as the #1 S&P ratifies Grupo Argos’ score company in the global ranking of The in its annual evaluation of global World's Top Female-Friendly Companies corporate sustainability Grupo Argos occupied the first place a
Slide 40: Increased valuation potential according to current arbitrage prices
CORPORATE PRESENTATION GRUPO ARGOS - 3Q2022 Increased valuation potential according to current arbitrage prices Pgrupo Argos Arbitrage1 Price (30/09/2022) COP / Acción Historical Arbitrage Gap (Relative Prices) 120 Lockdown begins (Mar – 2020) +64% (acc. Ord) +169% (acc. Pf) 100 100 16,137 Precio de
Slide 41: CEO, CFO, IR contacts
CORPORATE PRESENTATION CEO CFO Jorge Mario Velasquez Alejandro Piedrahita IR Manager IR Director Juan Esteban Mejia Carolina Arango Tel: (574) 315 8400 Tel: (574) 315 8400 E-mail: jemejia@grupoargos.com E-mail: carangoz@grupoargos.com www.grupoargos.com 41 November 2022
Slide 42: Corporate Presentation November 2022
CORPORATE PRESENTATION 42 November 2022