Grupo Argos S.a. · BVC:GRUPOARGOS
Grupo Argos — Q3 2018 Earnings Presentation
27 slides from Grupo Argos's earnings presentation, 2018
Slide 1: Quarterly Earnings Presentation Third Quarter 2018
Quarterly Earnings Presentation Third Quarter 2018
Slide 2: Important Note
IMPORTANT NOTE • This presentation contains certain forward-looking information and statements related to GRUPO ARGOS and its subsidiaries that are based on current knowledge of events, expectations and forecasts, circumstances, and assumptions about future events. Many factors could cause the futur
Slide 3: Focused strategy that translates into tangible results on all fronts
STRATEGY FOCUSED STRATEGY THAT TRANSLATES INTO TANGIBLE RESULTS ON ALL FRONTS ▪ Net profit of controlling company up +42% Y/Y* GRUPO ARGOS ▪ Individual results with growth of +200% in the equity method Efficient Capital Allocation ▪ Administration expenses of Grupo Argos down -56% ODINSA ▪ EBIDTA gr
Slide 4: Sustainability: world's most sustainable construction materials company
SUSTAINABILITY GRUPO ARGOS IS THE WORLD’S MOST SUSTAINABLE COMPANY IN THE CONSTRUCTION MATERIALS INDUSTRY, ACCORDING TO THE DOW JONES SUSTAINABILITY INDEX Grupo Argos and Grupo Argos and Grupo Argos Cementos Argos Celsia Cementos Argos Cementos Argos 2nd 6th 5th IG consecutive year as consecutive ye
Slide 5: Concrete advances in ESG matters
SUSTAINABILITY CONCRETE ADVANCES IN ESG MATTERS Dimension Dimension Dimension ECONOMIC SOCIAL ENVIORNMENTAL • Independent Board President • Responsible Operation Goal: LABOR • Responsible Operation Goal - CLIMATE • 43% of women members on the Board CLIMATE: 95.3% in the Great Place to CHANGE: 33% re
Slide 6: Consolidated: net profit of the controller grows 42%
CONSOLIDATED NET PROFIT OF THE CONTROLLER GROWS 42%, EXCLUDING THE SALE OF COMPAS, SUPPORTED IN A STRATEGY THAT SEEKS TO STRENGTHEN THE HOLDING COMPANY AND MAKE MORE PROFITABLE ITS INVESTMENTS IMPORTANT FIGURES Consolidated Statement of Income NOTES Consolidated Quarterly Consolidated Year to Date C
Slide 7: Consolidated: positive contributions to revenues from all strategic businesses
CONSOLIDATED POSITIVE CONTRIBUTIONS TO REVENUES FROM ALL STRATEGIC BUSINESSES CONTRIBUTION BY BUSINESS REVENUES (COP billion) -3 403 -403 3,663 62% -1% -11% 3T2017 Revenues Sep-2017 Cement Energy Real estate Portfolio Coal Concessions Other 3T2018 Revenues Sep-2018 Compas 494 -82% 91 403 88 2017 201
Slide 8: Consolidated: EBITDA result confirms successful strategy
CONSOLIDATED THE EBITDA RESULT CONFIRMS THE SUCCESSFUL STRATEGY OVERTAKEN IN THE STRENGTHENING OF THE STRATEGIC BUSINESSES CONTRIBUTION BY BUSINESS EBIDTA (COP billion) 153 -5 1,040 -153 62% -2% -15% 3T2017 Revenues Sep-2017 Cement Energy Real estate Portfolio Coal Concessions Other 3T2018 Revenues
Slide 9: Individual: gains from equity method increased by 200%
INDIVIDUAL GAINS FROM EQUITY METHOD INCREASED BY +200% IN THE QUARTER, DRIVEN BY HIGHER PROFITS IN THE CONCESSIONS AND CEMENT BUSINESS IMPORTANT FIGURES NOTES Separate Statement of Income COP billion 1 Consolidated Quarterly Consolidated Year to Date Distribution of revenues in 3Q 2018 3Q - 2018 3Q
Slide 10: Individual: cost of debt continues at minimum
INDIVIDUAL COST OF THE DEBT CONTINUES IN MINIMUM AND THE FINANCIAL EXPENDITURE STAYED STABLE FOR THE QUARTER, DESPITE THE SMALL INCREASE IN DEBT INDEBTEDNESS* LEVERAGE INDICATORS COP billion +10% 1,732 4.5x 1,567 44 sep-2017 sep-2018 Max: 4.0x 4.0x Adjusted EBIDTA** 350 3.5x Max: 3.5x (COP billion):
Slide 11: Individual: cash flow as leverage to strengthen strategic business
INDIVIDUAL CASH FLOW AS LEVERAGE TO STRENGTHEN OUR STRATEGIC BUSINESS COP million NOTES 1 Dividendos netos Net dividends 164,603 1 Dividends received: COP 371 billion, dividends paid: COP 207 billion 2 Ingresos Urban NDU income development 36,652 2 Sale of plots of land: COP 37 billion 3 Venta accio
Slide 12: Concessions Business
Concessions Business 12
Slide 13: Executive Summary: Concessions
EXECUTIVE SUMMARY FOCUS ON PROFITABLE GROWTH WITH TANGIBLE RESULTS AT THE EBITDA AND NET PROFIT LEVEL, WHICH GROWS SIGNIFICANTLY HIGHLIGHTS OF THIS QUARTER 3Q18 Consolidated ▪ Quiport: ▪ Passenger growth for the quarter of 4%, which translates into revenue growth (+ 9%), EBITDA (+ 10%), and net Reve
Slide 14: Operating Results: air traffic and vehicle traffic
OPERATING RESULTS INCREASE IN AIR TRAFFIC PRESENTS AN ACCUMULATED GROWTH OF 3%. QUITO AIRPORT TRAFFIC GROWS AT 5% AVERAGE DAILY VEHICLE TRAFFIC 3Q2018 -0.7% Thousands of vehicles AKF 72.6 74.4 Vehicle traffic in 3Q18 totaled 3.0 million, down -5% due to road works of Pacífico 3, which 2.5% affected
Slide 15: Financial Results: Odinsa
FINANCIAL RESULTS ROAD SEGMENT, CONSTRUCTION AND AIRPORTS CONTRIBUTE POSITIVELY TO EBITDA THAT GROWS 122% REVENUE EBIDTA NET PROFIT COP Billion COP Billion COP Billion 69 -7% 122% 2 Sep-2017 3Q2017 Sep-2018 3Q2018 Reduction in revenues due to: Increase in EBIDTA due to: Increase in net profit due to
Slide 16: Financial Results: Opain
FINANCIAL RESULTS RESULTS OF OPAIN SUPPORTED IN TRAFFIC GROWTH. THE EXTENSION OF COMMERCIAL ZONES BEGINS TO SHOW IMPROVEMENT IN NON-REGULATED REVENUES, WHICH GROW BY 30% PASSENGERS REVENUES (Regulated + Non-Regulated) MILLIONS OF PASSENGERS COP Billion 9 7.8 8.0 7.9 8.0 8.0 -3% 8 7.6 7.6 →Change Y/Y
Slide 17: Cement Business
Cement Business 17
Slide 18: Executive Summary: Cement
EXECUTIVE SUMMARY FOCUS ON EFFICIENCY THAT HAS BEEN REFLECTED IN INCREASE IN EBITDA OF 4% AND NET INCOME OF 13% HIGHLIGHTS OF THIS QUARTER 3Q2018 ▪ Closing of a syndicated loan for USD 600 million, which demonstrates the financial system’s support for the Company’s financial strategy ▪ Maturities le
Slide 19: Operating Results: cement and concrete volumes
OPERATING RESULTS GREATER DISPATCHES TO CIVIL WORKS IN COLOMBIA + 53% YoY, CONFIRM THE LEADERSHIP OF CEMENTOS ARGOS AS THE MAIN PROVIDER OF CONCRETE FOR THE INFRASTRUCTURE PROJECTS IN THE COUNTRY CEMENT VOLUMES CEMENT SALES (Tons, thousands) 3rd quarter 2018 +3% Y/Y +2% Y/Y +1% Y/Y 32% 37% USA 4.242
Slide 20: Financial Results: Cementos Argos
FINANCIAL RESULTS COMMERCIAL EFFORTS + DECREASE IN SG&A+ IMPROVEMENT IN CAPITAL STRUCTURE = NET INCOME GROWING AT 13% REVENUE ADJUSTED EBITDA* NET PROFIT COP Billion COP Billion % 74 65 +1% 4% +13% 3Q2017 3Q2018 3Q2017 3Q2018 Sep-2017 3Q2017 Sep-2018 3Q2018 Increase in revenues due to: Reduction in
Slide 21: Energy Business
Energy Business 21
Slide 22: Executive Summary: Energy
EXECUTIVE SUMMARY CELSIA CONTINUES TO ADVANCE ON THE STRENGTHENING AND SIMPLIFICATION OF ITS STRUCTURE AS AN ANSWER TO THE CHALLENGES IMPOSED BY ITS GROWTH STRATEGY HIGHLIGHTS OF THIS QUARTER 3Q2018 ▪ An announcement was made on a possible acquisition of Celsia assets by Epsa. ▪ Rationale: REVENUE ▪
Slide 23: Operating Statistics: Celsia
OPERATING STATISTICS 12% GROWTH IN SALES TO THE NON-REGULATED MARKET IN COLOMBIA, ABOVE THE MARKET’S 6% GROWTH RATE, THANKS TO ACTIVE COMMERCIAL EFFORTS GENERATION BREAKDOWN OF GWh GENERATION Celsia 5% CA 15% Zona Franca 27% -0.3% 1,438 GWh 3Q2017 COL contracts COL spot market CA contracts CA spot m
Slide 24: Financial Results: Celsia
FINANCIAL RESULTS REVENUES GREW BY 8% DRIVEN BY GREATER THERMAL GENERATION IN COLOMBIA REVENUE EBIDTA NET PROFIT OF THE CONTROLLING COMPANY COP billion COP billion % +18% Y/Y 66 46 -20% Y/Y -4% Y/Y -30% Y/Y +8.5% -12% -31% 3Q2017 3Q2018 3Q2017 3Q2018 Sep-2017 3Q2017 Sep-2018 3Q2018 Increase in reven
Slide 25: Real Estate Business
Real Estate Business 25
Slide 26: Executive Summary: Real Estate
EXECUTIVE SUMMARY PACTIA DIVESTS OF REAL ESTATE ASSETS FOLLOWING MATERIALIZATION OF INVESTMENT THESIS Urban Development ▪ Cash flow in 3Q18 totaled COP 8 billion, of which COP 6 billion is ▪ A call to capitalize was made to Protección for COP 85 billion in July, through from the sale of plots of lan
Slide 27: Financial Results: Pactia
FINANCIAL RESULTS GROSS CASH REVENUE INCREASED BY 22%, ADJUSTED BY THE PROFIT GENERATED FROM THE SALE OF ASSETS PARTICIPATION IN PACTIA GLA % m2 60.0% 50.6% 50.6% 3.4% 46.1% 46.1% 44.1% 50.0% 42.1% 40.4% 2.0% 39.8% 39.8% 36.3% 36.3% 34.7% 40.0% 33.5% 32.1% 19.0% Industria Industry 24.4% 27.5% 21.2%