Quinenco S.a. · BCS:QUINENCO
Quinenco — Investor Presentation (November 2015)
48 slides from Quinenco's investor presentation, November 2015
Slide 1: Company Presentation / November 2015
Company Presentation / November 2015 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$ 3.3(1) billion (1) Market Capitalization as of October 30, 2015 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$20 billion in 2014 • The Quiñenco group of companies employs around 69,000 people in Chile and abroad 4
Slide 5: Quiñenco: Main Operating Companies
Quiñenco: Main Operating Companies % Control as of September 2015 51.2% 60.0% 28.6%(2) 65.9% 56.0% 42.4% 100% Mkt.Cap(1): Mkt.Cap(1): Mkt.Cap(1): Mkt.Cap(1): Mkt.Cap(1): Mkt.Cap(1): US$ 820 mln(4) US$ 10.2 bln US$ 1.7 bln US$ 124 mln CSAV: US$ 0.8 bln US$ 0.6 bln US$ 4.4 bln HL(3): US$5.2 bln • 1st
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$1.7 billion in profits over the last 18 years from divestments of US$4.0 billion 1,705 918 713 (1) 58 37 Telecom Retail Real estate/Hotels Beverage & Food Utility Financial Services Total
Slide 13: Strong Growth in NAV
Strong Growth in NAV Over the past 11 years, the net value of Quiñenco’s assets has grown at an average compound annual rate of 13% Quiñenco - NAV (MUS$) CAGR(2) (1) 2003 – 2014 6.858 (1) 6.541 Quiñenco’s NAV 12.6% 5.789 (1) (1) 5.351 IPSA 11.9% 5.137 5.136 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$ 5.3 billion as of June 30, 2015) (US$ 5
Slide 16: NAV & Share Price Trend
NAV & Share Price Trend NAV/Share Price Trend as of June 30, 2015 2.500 1.999 2.017 2.043 1.953 1.974 2.000 1.500 1.295 1.300 1.280 1.335 1.000 1.145 500 0 Jun- 14 Sep- 14 Dec- 14 Mar- 15 Jun- 15 NAV per share (CH$) Share price (CH$) Note: Market information and book values as of June 30, 2015 NAV:
Slide 17: Diversified Revenues and Results 1H 2015
Diversified Revenues and Results 1H 2015 Quiñenco has achieved diversified revenues and results, thus generating stable cash flows Aggregate Revenues by Sector (1) Net Income (2) (YTD June 2015) (YTD June 2015, MUS$) Port & Shipping Serv. Financial Services 2% 10% Beverage & Food 8% 91.9 140.0 43.0
Slide 18: Quiñenco Holding: Conservative Financial Structure
Quiñenco Holding: Conservative Financial Structure Long term investments are financed with equity and long term debt in Chilean pesos Assets Liabilities and Equity US$ 5.3 billion as of June 2015 US$ 5.3 billion as of June 2015 Cash Other 6% 1% ST Debt Other Liabilities 2% 2% LT Debt 11% SH Equity L
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$ 576 417 345 191 59 2011 2012 2013 2014 jun-15 MUS$ 2011 2012 2013 2014 Jun 2015 Debt 596(1) 696 842 907 897 Cash -251 -505 -783 -490 -321 Net Debt 345(1) 191 59 41
Slide 20: Stable Dividend Cashflow
Stable Dividend Cashflow Good operating company performance allows a strong dividend flow to the parent company YTD June 2015 Dividends Composition of Dividends (MUS$) (YTD March 2012) SM SAAM 9% CCU 472 20% 122 129 75 78 Banchile Vida 10% 2011 2012 2013 2014 jun-15 SM SAAM Banchile Seguros de Vida
Slide 21: Quiñenco – Strong Fundamentals
Quiñenco – Strong Fundamentals Dominant position in its markets Quiñenco’s companies are leaders in their respective markets. Proven track record in value Holding has proven track record in value creation as evidenced by sale creation of investments for approximately US$ 4.0 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$) (MUS$) 6,113 535 5,069 4,077 3,375 2,982 2,778 219 195 138 140 91 2011 2012 2013 2014 jun-14 jun-15 2011 2012 2013 2014 jun-14 jun-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
Quiñenco Bond Issuance • In July 2014 Quiñenco successfully placed UF 2,375,000 (approx. US$100 million) in bonds in the local market. Tender Offer for Invexans • On December 4, Quiñenco announced that the Board of Directors approved a Tender Offer for 19.55% of Invexans which was not held by Quiñen
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). 39% • As of August 2015, Banco de Chile had gained 64 bp of market share in total loans from 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. • Towards the end of September 2014 Techpack launched a US$150 million capital increase, approved by i
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 • In 2014 the Bank’s net operating revenues grew ROAE 13.1%, based on higher loans to customers and a favorable effect of inflation on the bank’s net asset position in UFs, which compensated higher loan provisions. Operating revenues in 1H 2015 were 26,2% 23,9% 23,3% 23,5% 24,4% down
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 • Sales grew by 8.4% in 2014 to MUS$2,031, reflecting growth in all segments, led by Chile segment based on EBITDA by Business Segment higher volumes and average prices. 1H 2015 sales (June 2015) growth reached 15.9%, led by Río de la Plata segment. Other • EBITDA was MUS$389 in 2014 decreasing
Slide 34: Invexans
Invexans • Invexans’ main asset is its 28.63% stake in Nexans, • Invexans now has three directors on the Board, a a leading cable manufacturer with worldwide member of the Compensations and Designations presence, based in France. Committee, and a member of the Strategic • An agreement signed in Sept
Slide 35: Nexans
Nexans • Nexans is a worldwide leader in the cable industry with presence in 40 countries and commercial activities worldwide, after over a century of progress. • Headquartered in Paris, France, Nexans produces cables and cabling systems at more than 90 production sites across 5 continents. • 26,000
Slide 36: Invexans
Invexans • In 2014 Invexans’ net income mainly reflects its Operating Income proportional share in Nexans’ net income for (MUS$) the year, which posted an improvement over 2013’s results, partially offset by higher 16 expenses at Invexans related to provisions and payments of legal contingencies in
Slide 37: Techpack (ex-Madeco)
Techpack (ex-Madeco) • 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 incre
Slide 38: Techpack
Techpack • Techpack’s operating income in 2014 is lower than Sales the previous period mostly due to negative goodwill of MUS$30 related to Peruplast in 2013. (MUS$) However, during 2014 the consolidation of HYC Packaging in Chile and growth in Colombia are 351 372 noteworthy. In 1H 2015, operating
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 in 2014 reached MUS$3,406, mainly corresponding to fuels, boosted by the acquisition Sales of Terpel Chile in June 2013. In 1H 2015 sales (MUS$) declined due to lower fuel prices. • Operating income grew 32% to MUS$52 in 2014, 3,406 mainly reflecting the favorable effect of the 2,751 ad
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. Quiñenco increased its stake to • Its activities include overseas transport of 54.5% containerized cargo through its investment in Hapag- • On Decemb
Slide 42: CSAV
CSAV • In 2014 CSAV’s sales reached MUS$2,741, 14.5% below 2013, mainly because 2014 includes only 11 months of Sales operations, along with lower freight rates. 1H 2015 sales (MUS$) mainly reflect lower car carrier imports to Chile and Peru. • Net income in 2014 was a gain of MUS$389, a 4,796 subst
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 • SM SAAM’s consolidated sales in 2014 reached MUS$492, up 2.8% over 2013, reflecting improved Sales performance in port terminals and tugboats, which (MUS$) compensated lower revenues from logistics. 1H 2015 479 492 sales reduced due to deconsolidation of tugboat 448 operations in Brazil an
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