Slide 1: FY2016 Analyst Presentation
ALLIANCE GLOBAL GROUP INC FY2016 Analyst Presentation 07 April 2017 1
Slide 2: FY2016 key messages
• Earnings buoyed by cost efficiencies across all business segments; topline growth steady. • Focusing on sustainable operations. • Capex program still heavy, funding through internal sources and some borrowings. • Financial gearing comfortable. • Healthy balance sheet. 2
Slide 3: AGI Group Structure
AGI Group Structure A ALLIANCE GLOBAL VA ALLIANCE GLOBAL AGI PM (US$ 2.7bn) a % 81% 44% 49% TRAVELLERS = = MEGAWORLD EMPERADOR INC. INTERNATIONAL GGOLDEN ARCHES DEVELOPMENT CORPORATION MEG PM EMP PM RWM PM 3 Number 1 in Number 1 in the Most profitable _ Number 2. townships liquor industry integrated
Slide 4: Group key figures 2016
P492bn P140bn 7% 3,643 in total resources in total Parent net Hotel room keys (2016) revenues (2016) debt/equity (2016) (2016)
Slide 5: Business highlights by segment
• Megaworld Doubled rental GLA to 1.12m sqm in 2016 from 2011 level. Office GLA at 851k sqm; commercial GLA at 273k sqm. Breached P1bn in hotel revenues. Intensified township development throughout the country. • Emperador Pursued aggressive global distribution for Whyte & Mackay branded p
Slide 6: Net profit up 6%; revenues flat
• Net profit +6%; revenues stood flat. • MEG + EMP = 62% revenue share; 93% of group profit. • Notable cost efficiencies across all business segments. P[VALUE]bn (4%) P[VALUE]bn P22.8bn (16%) (10%) P46.7bn (33%) P[VALUE]bn (51%) P27.6bn (20%) P[VALUE]bn (43%) P40.9bn (29%) MEG EMP RWM GADC Others ME
Slide 7: P&L highlights
P&L highlights (Pbn) 2016 2015 % chg Comments Group revenues 139.74 139.10 0% Megaworld 46.69 44.90 4% Robust growth in rentals; residential segment steady Emperador 40.92 43.66 -6% Lower whisky sales due to RSV exit; brandy sales growth helped by contributon from Fundador Travellers 27.58 27.84 -1%
Slide 8: Quarterly revenues and net income by segment
3.8 3.9 39.5 38.1 4.5 4.0 3.4 3.8 34.5 40.0 3.5 4.0 3.3 34.2 33.1 34.0 3.1 32.3 33.1 35.0 3.5 3.0 30.0 2.5 25.0 2.0 20.0 1.5 1.0 15.0 0.5 10.0 - 5.0 (0.5) - (1.0) Q115 Q215 Q315 Q415 Q116 Q216 Q316 Q416 Q115 Q215 Q315 Q415 Q116 Q216 Q316 Q416 Others 0.6 0.7 0.4 0.6 0.6 0.4 0.4 0.3 Others (0.0) 0.2 (
Slide 9: Five-year revenue and income trends
16% on 100% 5% 8% 2% 2% 1% 139.1 139.7 five-year 90% 12% 15% 15% 16% 125.4 123.4 14% 13% 140.0 CAGR 80% 102.1 18% 70% 25% 20% 20% 120.0 4% 31% 27% 60% 66.3 100.0 50% 26% 80.0 25% 31% 29% 40% 23% 24% 60.0 30% 40.0 20% 39% 33% 33% 20.0 27% 28% 32% 10% 0.0 0% 2011 2012 2013 2014 2015 2016 2011 2012 201
Slide 10: Segment EBITDA trends
100.0 87 90.0 78 75 80.0 72 70.0 55 60.0 50.0 40.0 31 26 30.0 19 20.0 10.0 0.0 2010 2011 2012 2013 2014 2015 2016 2017E MEG EMP RWM GADC 10
Slide 11: Funding capex through internal cash flows and debts
• Funding capex through internal cash flows and debts. • Debts grew three-fold from 2011 level; still comfortable. 12% 143.9 117.8 10% 29.8 96.6 1.7 19.8 8% 21.9 2.0 69.5 18.7 14.2 64.1 1.9 6% 29.4 13.4 29.2 44.0 21.6 23.7 29.1 4% 1.7 1.7 0.7 1.0 17.7 20.2 19.3 - 61.2 52.6 - - 2% 28.6 33.5 21.5 20.1
Slide 12: Net debt and net debt/equity
• In end-2016, consolidated net debt/equity stood at 0.38x. • Parent net debt/equity remained low at 0.07x. Net debt (cash) (Pbn) Net debt/equity 100.0 0.38x 0.50x 80.0 0.40x 60.0 0.30x 0.17x 40.0 0.20x 20.0 0.10x 0.02x 0.0 0.00x -20.0 -0.10x -40.0 -0.11x -0.20x -0.17x -0.20x -60.0 -0.30x 2011 2012
Slide 13: Megaworld
ait MEGAWORLD “sd TOWNSHIPS: LIVE IT! LOVE IT!
Slide 14: Townships landbank, office and commercial GLA
Townships Office GLA landbank BPO Clients Commercial GLA 14
Slide 15: Megaworld 2016 highlights
• Total revenues +4% YoY to P46.8bn. • Rentals (office and commercial): +15% to P10.0bn. • Rentals share of total revenues: 21% (from 19% in 2015). • High occupancy rates of 98-99%. • Real estate sales: +1% to P27.5bn. • 60% MEG-standalone, 16% GERI, 15% Empire East, 9% Suntrust. • Hotel revenues: +
Slide 16: Megaworld revenues and EBIT margins
50.0 35.0 33.1 32.7 45.3 43.3 2016 2015 1.2 0.8 30.0 40.0 10.0 GP margin 46.1% 46.0% 9.0 25.0 EBIT margin 25.7% 24.5% 30.0 20.0 16.5 15.1 20.0 15.0 13.3 13.2 33.1 32.7 0.2 0.2 10.0 7.7 6.6 8.5 8.0 10.0 8.5 8.0 0.0 5.0 2016 2015 2016 2015 0.0 Revenues (Pbn) EBIT (Pbn) Revenues Gross profit EBIT 2016
Slide 17: Megaworld quarterly development and rental
12.0 4.6 15.0 11.2 11.3 11.0 4.6 11.4 11.2 4.4 4.1 10.6 10.2 3.9 5.0 3.4 3.5 3.1 10.0 4.0 3.0 5.0 2.0 1.0 0.0 0.0 Q115 Q215 Q315 Q415 Q116 Q216 Q316 Q416 Q115 Q215 Q315 Q415 Q116 Q216 Q316 Q416 -1.0 Development Rental Hotels Others Development Rental Hotels Others *Excludes interest and other income
Slide 18: Megaworld sales, rentals, hotels and net debt
16.0 80% 2.6 3.0 2.6 2.6 2.3 2.3 2.2 2.2 12.0 51% 60% 2.5 2.0 48% 46% 45% 47% 46% 44% 1.0 1.0 1.0 40% 2.0 0.9 0.9 0.9 0.9 8.0 40% 0.8 1.5 1.0 4.0 20% 1.3 1.3 1.4 1.4 1.5 1.5 1.6 1.2 0.5 - 0% - Q115 Q215 Q315 Q415 Q116 Q216 Q316 Q416 Q115 Q215 Q315 Q415 Q116 Q216 Q316 Q416 Real estate sales Gross pro
Slide 19: Megaworld revenue mix and rentals
100% 100% 2% 1% 0% 1% 2% 2% 1% 2% 2% 3% 13% 9% 16% 25% 1% 1% 18% 18% 18% 21% 22% 80% 80% 41% 1% 44% 47% 36% 38% 60% 60% 1% 36% 26% 40% 80% 77% 77% 75% 76% 73% 40% 50% 52% 53% 52% 20% 20% 37% 32% 0% 0% 2011 2012 2013 2014 2015 2016 2011 2012 2013 2014 2015 2016 Development Rental Hotels Others Develo
Slide 20: Total of 22 Townships
35.6 ha 18.5 ha ArcoVia 12.4 ha 5 ha City 50 ha 25 ha 34.5 ha E A S T L A N *D 640 ha H E I G H T S 15.4 ha 62 ha 31 ha W E S T S I D E 140 ha C *I T Y 561 ha Maple Grove 1,200 350 ha ha 150 ha Megaworld 34 ha GERI 30 ha Suntrust 53 ha 72 ha Total of Sta. Barbara Heights 173 ha 22 Townships 11 ha 20
Slide 21: GLA capacity additions
2,500 ~250k sqm annual capacity addition 2,000 1,500 ~115k sqm annual capacity addition 1,000 500 - 2010 2011 2012 2013 2014 2015 2016 2017E 2018E 2019E 2020E End-2016 GLA capacity Additions 2017 Additions 2018 Additions 2019 Additions 2020 21
Slide 22: Emperador
EMPE DOR
Slide 23: Emperador overview
1st Dalmore flagship store in the Sales offices Distribution Philippines nationwide network Consolidated Total resources (2016) Revenues(2016)
Slide 24: Emperador 2016 highlights
• Revenues -6% to P41.0bn. • Brandy sales +9% to P29.6bn (72% of total). • Fundador contributed 4% of revenues. • EMP-domestic +2% YoY amidst a highly competitive landscape. • Whisky sales -31% to P11.4bn (28% of total). • Decline due to exit of Russian Standard Vodka. • Improvement in overall margi
Slide 25: Emperador quarterly results and margins
15.0 3.0 0.4 12.0 5.8 3.7 2.5 9.0 4.2 2.0 0.6 0.2 3.3 2.2 2.7 2.7 0.3 3.2 1.5 0.0 0.2 0.2 0.3 2.4 6.0 8.8 9.4 1.0 1.9 6.6 6.7 6.7 6.8 1.4 1.6 1.6 3.0 5.7 6.1 1.2 1.2 1.2 0.5 - - Q115 Q215 Q315 Q415 Q116 Q216 Q316 Q416 Q115 Q215 Q315 Q415 Q116 Q216 Q316 Q416 EMP ex-WMG WMG EMP ex-WMG WMG Net debt Net
Slide 26: Brandy and whisky quarterly results
1.4 5.8 3.7 1.1 4.2 0.7 0.7 3.3 2.2 2.7 2.7 0.8 0.8 3.2 0.6 0.6 4.3 8.6 9.5 3.1 6.0 6.6 6.6 6.3 6.7 2.8 2.3 2.8 5.5 2.2 2.1 2.2 Q115 Q215 Q315 Q415 Q116 Q216 Q316 Q416 Q115 Q215 Q315 Q415 Q116 Q216 Q316 Q416 Brandy Whisky Brandy Whisky 10.0 46% 45% 48% 50% 7.0 31% 35% 39% 28% 27% 35% 37% 6.0 25% 30%
Slide 27: Brandy and whisky annual trends
50.0 16.0 40.0 3.6 16.5 11.3 12.0 3.3 0.7 30.0 3.5 8.0 20.0 11.5 28.6 27.8 26.7 29.1 9.2 10.4 10.4 22.8 4.0 8.2 10.0 17.0 4.4 0.0 0.0 2011 2012 2013 2014 2015 2016 2011 2012 2013 2014 2015 2016 Brandy Whisky Brandy Whisky Pbn GP margin GP margin Pbn 35.0 50% 20.0 30% 38% 39% 40% 30.0 36% 28% 25% 32%
Slide 28: Emperador Light price points
350ml 750ml 1l 1l 1l USD0.84-0.96/ USD1.65-1.90/ USD2.25-2.60/ USD4.28-4.90/ USD6.17-7.05/ 28 PHP42-48 PHP83-95 PHP 113-130 PHP215-246 PHP310-354
Slide 29: Initiatives: Whisky awareness
"A ALLIANCE GLOBAL x oge 0 e EMPERADOR INC. Initiatives: Whisky awareness q ANDY ING PINER
Slide 30: Initiatives: Product portfolio
"A ALLIANCE GLOBAL x O40 O ° - ; EMPERADOR INC. Initiatives: aT perms = A vy: on 44.7. aaa DALMORE. | litd shackleton fe ; om MA bs FUNDADOR = ae - E — | ee | é 5 é “and ae Gale omey Re = i rea h ANDYCOLA an Sper eee Cap ie EMPE RADOR EMPERADOR LIGHT BRANDY
Slide 31: Export regions
North America Europe Asia Middle East Africa 2013 Export Region New Export Region 31
Slide 32: Travellers International
TRAVELLERS INTERNATIONAL THE FILIPINO 32)
Slide 33: Travellers overview
hotel gaming Capacity retail sqm of average occupancy rooms tables Slots MGB outlets retail space rate Gross Revenues Total Resources EBITDA (2016) (2016) (2016)
Slide 34: Travellers 2016 highlights
• Gross revenues -1% to P27.5bn. • GGR -2% to P23.6bn, still focused on non-VIP segment. • Mass drop +8%; VIP volumes down sharply. • Blended hold rate at 5.2%; VIP hold rate recovered. • Mass/VIP GGR mix now at 62%/38% (from 57%/43% a year ago). • Non-gaming revenues +10% to P3.8bn. • 85% occupancy
Slide 35: Travellers quarterly revenues and EBITDA
0.8 1.0 0.9 0.9 1.0 1.1 0.9 0.8 3.5 2.7 2.4 2.7 2.3 1.9 1.9 1.9 6.2 5.6 5.6 5.6 4.6 4.6 4.9 5.1 3.3 3.4 3.5 3.5 3.7 3.8 3.5 3.7 Q115 Q215 Q315 Q415 Q116 Q216 Q316 Q416 Q115 Q215 Q315 Q415 Q116 Q216 Q316 Q416 Net gaming Non-gaming Mass VIP EBITDA (Pbn) Margin Net debt Net debt/ 3.0 35% (cash) (Pbn) e
Slide 36: Mass and VIP gaming trends
25 400.0 350.0 20 300.0 15 250.0 314 200.0 263 267 280 258 194 175 193 173 10 150.0 130 100.0 5 50.0 62 69 68 67 70 72 67 72 75 75 - - 1H12 2H12 1H13 2H13 1H14 2H14 1H15 2H15 1H16 2H16 Mass drop (Pbn) VIP rolling (Pbn) Mass GGR VIP GGR (Pbn) Hold rate Hold rate 12 6% (Pbn) 10 11% 11% 11% 11% 11% 12%
Slide 37: Travellers annual revenue and EBITDA
100% 95% 10% 10% 11% 11% 3.0 3.4 3.2 14% 15% 2.7 3.5 3.8 90% 26.4 27.5 25.9 85% 24.0 21.1 21.3 90% 90% 89% 89% 80% 86% 85% 75% 2011 2012 2013 2014 2015 2016 2011 2012 2013 2014 2015 2016 Net gaming Non-gaming Net gaming Non-gaming EBITDA (Pbn) Margin 10.0 30% 30% 35% 25% 30% 8.0 22% 23% 13.8 15.2 13
Slide 38: Pedestrian bridge to NAIA Terminal 3
• 220 meter air-conditioned pedestrian bridge linking Ninoy Aquino International Airport Terminal 3 to Newport City. • It can accommodate 2,000 people at any time or 216,000 travelers per day. • Opening April 2017. 38
Slide 39: Phase 3 expansion
Maxims Hotel (191 keys) Sheraton Hotel Manila (391 keys) Hilton Manila Hotel (357 keys) • Three (3) new hotels • Additional 14,000 sqm in gaming areas • Additional 3,200 sqm in retail space • Six (6) level basement parking • Target completion by end-2017 to 2018 39
Slide 40: Golden Arches Development Corporation
GOLDEN ARCHES DEVELOPMENT CORPORATION FIRST FOR THE
Slide 41: GADC overview
In sales revenues (2016) System wide same- store sales growth (2016) dessert centers McDelivery hubs
Slide 42: GADC 2016 highlights
• Sales revenues +11% to P22.6bn. – 91% from sales by co-owned stores; 9% from rent, royalty & others. – Systemwide same-store sales +7% YoY. – 520 stores (vs 481 a year ago): 53% owned; 47% franchised/JVs. – Revenue per store +3% YoY. • Overall improvement in margins amid operating leverage. – GP m
Slide 43: GADC quarterly results and store count
7.0 6.2 0.6 0.5 5.5 5.6 5.6 0.5 6.0 5.2 5.2 0.5 0.5 4.8 4.9 0.4 0.4 5.0 0.4 0.4 0.3 4.0 0.3 0.3 0.3 3.0 0.3 0.2 0.2 1.8 0.2 0.2 2.0 1.2 1.3 1.3 0.2 0.2 0.2 1.0 1.0 1.1 1.1 1.0 0.1 - Q115 Q215 Q315 Q415 Q116 Q216 Q316 Q416 - Q115 Q215 Q315 Q415 Q116 Q216 Q316 Q416 Sales revenues Gross profit EBIT Net
Slide 44: GADC sales mix, SSSG and margins
7.0 16% 12.6% 6.0 0.5 0.5 0.5 0.5 11% 9.8% 5.0 0.5 0.5 7.7% 0.4 0.5 7.2% 7.2% 7.4% 4.0 9.9% 6% 3.0 5.7 3.1% 7.2% 5.1 4.7 5.1 5.0 6.8% 2.0 4.3 4.4 4.7 4.9% 3.5% -0.7% 4.0% 1% 3.1% 1.0 1.1% - -4% Q115 Q215 Q315 Q415 Q116 Q216 Q316 Q416 Q115 Q215 Q315 Q415 Q116 Q216 Q316 Q416 Sales by co-operated resta
Slide 45: GADC annual revenue and margins
Revenue, GP GP Margin 25.0 24% 25% 16.9 20.0 24% 22% 23% 23% 14.6 23% 12.1 15.0 10.6 21% 22% 8.9 10.0 21% 7.7 21% 18.5 20.5 14.6 16.9 5.0 20% 10.7 12.6 - 19% 2011 2012 2013 2014 2015 2016 2011 2012 2013 2014 2015 2016 Co-owned stores Franchisees Sales revenues (Pbn) Gross profit (Pbn) Gross profit m
Slide 46: 200 100 - 46
900 900 800 700 600 500 481 520 457 376 408 400 309 329 300 200 100 - 46
Slide 47: Thank you.
Thank you. 47