Presentación de PowerPointripleyinversionistas.cl/wp-content/uploads/2018/10/... · Note: Amounts in CLP; EBITDA and EBIT LTM (1) Bloomberg, September 29th 2017 (2) Proforma using

Ripley Corp October 2017

First store in Santiago

First department

store

Credit business beginning

Opening of Ripley Parque

Arauco

First store in Peru

Opening of Ripley Bank

Chile

A COMPANY WITH HISTORY AND SUCCESS

IPO of Ripley Corp

Consolidation of Mall Aventura S.A.

Closing of Ripley Colombia’s operations

Ripley Chile Bank placed its first bond

First stores in Colombia.

Integration of Ripley’s Chilean

Financial Business

Acquisition of 22.5%

of Nuevos Desarrollos S.A.

Note: Amounts in CLP; EBITDA and EBIT LTM (1) Bloomberg, September 29th 2017 (2) Proforma using the consolidated EBITDA of Mall Aventura S.A. (from July 2016 on) and the unconsolidated EBITDA of Aventura

Plaza S.A. weighted by ownership of 2Q16 (3) Ripley opened its 44th store, Los Dominicos, in late August and its 45th store, Coquimbo, in late September (4) Proportional EBITDA, weighted by Ripley Corp’s ownership

Equ

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21

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Re

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Equ

ity

20

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Fin

anci

al

Equ

ity

29

.1%

Re

al E

stat

e

Equ

ity

9.1

%

Re

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Equ

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8.0

%

Fin

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Equ

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Est

ate

Ripley is a lead actor in the retail industry in Chile and Peru, with a market share of approximately 18% and 38%, respectively

It has an integrated participation in the retail, banking and real estate businesses in both countries

The Company opened in the stock market in 2005. Its current market capitalization is MMM$ 1,181(1)

Controlled by the Calderón Volochinsky family, which maintains 50% of the share capital of the Company (aug-2017)

43 stores(3)

272,573 m2

EBITDA: MMM$ 33

Chile 66%

Peru 34%

LTM Income MMM$ 1,644

Loan portfolio: MMM$ 775 1,274(Th) credit cards w/ debt EBIT: MMM$ 50

10 malls MMM$ 307 investment EBITDA(4): MMM$ 27

29 stores 192,884 m2 EBITDA: MMM$ 9

Loan portfolio: MMM$ 371 486(Th) credit cards w/debt EBIT: MMM$ 19

2 malls MMM$ 181 investment EBITDA(2): MMM$ 11

Sources: Ripley Corp’s Jun-17 Financial Statements

61 years of experience in the retail industry

RIPLEY CORP TODAY

A. RETAIL BUSINESS

B. FINANCIAL BUSINESS

C. REAL ESTATE BUSINESS

D. H1 2017 RESULTS

E. LOOKING FORWARD

RETAIL BUSINESS

STORES SITUATED IN THE BEST LOCATIONS

80% of our sales surface is located in main shopping malls in major cities of Chile and Peru

Selected locations

Ripley Chile’s distribution center has a surface of 67,000 m2 and dispatches 50 million units per year.

Meanwhile, Ripley Peru’s distribution center has a surface of 45,000 m2 and dispatches 32 million units per year.

RETAIL BUSINESS

LARGE LOGISTIC INFRASTRUCTURE IN PLACE

RETAIL STRATEGIC PLAN

RETAIL BUSINESS

Increase profitability per square meter with greater emphasis in fashion & brands and larger operational efficiencies

MAIN DRIVERS

Increase the profitability per square meter prioritizing fashion and clothing brands

Improve the efficiency in operations

Ripley’s Strategic Plan is focused on Product, Store and Management dimensions

PRODUCT DIMENSION

New management of private and exclusive brands, with a greater emphasis placed in our private labels

Management of private and exclusive brands based on lifestyle methodology, with a clear differentiation strategy through fashion

RETAIL BUSINESS


Alliances with large international retail groups such as Bestseller (Denmark) and In Situ (Spain)

STORE DIMENSION

A SIMPLE AND ENTERTAINING STORE

Standardize product displays and visual elements

Develop ecommerce and omnichannel

Create a entertaining and captivating store for our clients, based on the product

RETAIL BUSINESS


Increase m2 of apparel & fashion products complementing hard goods through omnichannel strategy

MANAGEMENT DIMENSION

Focus on profitability and efficiency towards each brand’s surface area

New service model optimizes staff expenses in stores

Align restock and product availability to a model that involves faster inventory turnover (Lead Time)

Optimize merchandise flow

RETAIL BUSINESS


> 60% stores with new attention model in Chile

272,307 276,080 276,080 269,446 272,573

42 43 43 42 43

2013 2014 2015 2016 jun-17

Selling surface area Chile (1)

156,842 173,189 177,799

192,884 192,884

22 26 27

29 29

2013 2014 2015 2016 jun-17

Selling surface area Peru

Selling surface in Peru N° of stores

692,969 743,576 744,346 763,647

350,908 376,810

350,748 394,712 400,557 405,313

188,131 188,646

2013 2014 2015 2016 jun-16 jun-17

Sales evolution (MMCLP)

Chile Peru

RETAIL BUSINESS

(1) Ripley opened its 44th store , Los Dominicos, in late August and its 45th store, Coquimbo, in late September (2) SSS presented in 12 months base for year end and 6 months base for June

1,043,717 1,138,288 1,144,903 1,168,960

539,039 565,456

-6%

-4%

-2%

0%

2%

4%

6%

8%

2014 2015 2016 6M jun-17

Same Store Sales (SSS) (2)

Chile Peru

15 24 36 48 72 94 203 294 353 447 514 730 1,066

1,275 1,592

1,958 2,350

2,820

1990 2001 2003 2005 2007 2009 2011 2013 2015

Awards Strategic Plan focused on platform development and

internet sales

Ripley’s e-Commerce sales are growing over market growth both Chile and Peru

Close to 80 million visits during 2016 to Ripley’s internet homepage in Chile

On April 4th Mercado Ripley.com was launched, allowing third parties to sale their products at Ripley’s website

Winner of the 2015 and 2016 in Chile and 2016 and 2017 in Peru

e-Commerce industry in Chile 1990 – 2016 (USD mm)

2016

RIPLEY’S e-COMMERCE

IMPORTANT GROWTH IN e-COMMERCE

2015 2016 2016 2017

40% 40% 40%

23% 25%

75%

2014 2015 2016

Chile Peru

e-Commerce sales YoY growth evolution

Sources: Ripley Corp Chamber of Commerce Santiago

A. RETAIL BUSINESS



D. H1 2017 RESULTS

E. LOOKING FORWARD

OU

R P

RO

MIS

E A SIMPLE BANK

Close to its customers

OU

R A

TTR

IBU

TES

TRANSPARENCY QUICKNESS ACCESABILITY BENEFITS In the sale In services Omnichannel From Ripley world

With the charges In problem resolution Monday through Sunday Ripley reward points

In the communication No waiting time Where the client wants to be Valued alliances

HO

W W

E'LL

DO

IT Client knowledge

Digital innovation in products, channels and services

Integration with retail

Lean processes

Culture and a capable team

FINANCIAL BUSINESS

MIGRATION TO RIPLEY MASTERCARD – CHILE’S CASE

As percentage of the loan portfolio

FINANCIAL BUSINESS

2013

Ripley begins offering MasterCard to new

clients

Greater selectivity with new clients and

focusing on existing clients migration

Resume growth in loan portfolio with a focus

on selectivity and migration of known

clients

2015 2016-2017

66%

34%

30%

35%

40%

45%

50%

55%

60%

65%

70%

Mastercard Private Label

Ripley Private Label Card

Ripley Mastercard

Used only in Ripley stores and a select group of associated commerce

No restrictions

Paid in Installments Revolving credit line

Source: Ripley Corp’s Jun-17 Financial Statements, SBIF and SBS

Good profitability indicators

16,7% 19,2% 19,3%

20,9%

2015 2016 jun-16 jun-17

ROE

17,7% 17,9% 18,8% 16,4%

2015 2016 jun-16 jun-17

ROE

20,0% 21,3% 20,6%

19,0%

2015 2016 jun-16 jun-17

Basel Index

13,6% 14,7% 15,6% 14,5%

2015 2016 jun-16 jun-17

Basel Index

746.319 778.659 729.608 775.115

2015 2016 jun-16 jun-17

Loan Portfolio (MMCLP)

325.078 359.414 335.812 370.752

2015 2016 jun-16 jun-17

Loan Portfolio (MMCLP)

Growing loan portfolio YoY

FINANCIAL BUSINESS

Solid financial position and good levels of Basel Index

Bank in Chile Bank in Peru

Healthy evolution of Early Non performing loans (“NPL’s”)

Late NPL’s show a slight increase when compared to previous years, yet in healthy levels and in line with the behavior of the Chilean banking system during 2017

New provision model introduced in October 2016 The Net Provision Expense, even considering the

new provisions model, is stable and in line with previous years.

CHILE’S FINANCIAL BUSINESS

14%

16%

18%

20%

22%NPL's 1-90 Days

3,5%

4,0%

4,5%

5,0%

5,5%

6,0%NPL's 90 + Days

0,1%

0,6%

1,1%

1,6%

Net Risk Provision Expense (1) (Does not consider non-IFRS provisions: contingent and additional

provisions)

2014 2015 2016 2016 Old provisions model 2017

(1) In October 2016, Ripley Bank Chile changed its risk provisions aligning its model to the SBIF definitions

Early and late NPL’s still maintaining healthy levels Rise in Net Provision Expenses in 2017 is

explained by: 1. Deterioration in the payment behavior of

the Peruvian banking system 2. Increase of alignment provisions, which are

based in behaviors with other banks and not only with Ripley Bank

However, the net risk provision has been improving in recent months, thanks to tougher risk assessment policies

PERU’S FINANCIAL BUSINESS

0,0%

0,2%

0,4%

0,6%

0,8%

1,0%

1,2%

Net Risk Provision Expense

2014 2015 2016 2017

7%

9%

11%

13%

15%

17%NPL's 1-90 days

1%

2%

3%

4%

5%

6%NPL's 90 + days

A. RETAIL BUSINESS



D. H1 2017 RESULTS

E. LOOKING FORWARD

REAL ESTATE BUSINESS

Ripley Corp’s ownership in Real Estate businesses (jun-17)

LTM EBITDA(1)

Ownership Country Investment(1)

(CLP MM) GLA (m2)(1) Malls

Mall Concepción 100% Chile 77,444 26,000 1

Nuevos Desarrollos S.A. 22.5% Chile 123,839 97,530 7

Inm. Mall Viña del Mar S.A. 50% Chile 105,571 58,500 2

Mall Aventura S.A. 100% Peru 180,823 122,900 2

Total 487,677 304,930 12

Notes: Amounts in MMCLP Nuevos Desarrollos includes: Plaza Sur, Plaza Alameda, Plaza Mirador Bío Bío, Las Américas (Iquique), Plaza Egaña, Plaza Copiapó and Mall Plaza Los Dominicos; Mall Aventura includes: Aventura Plaza Arequipa y Aventura Plaza Santa Anita; Inm. Mall Viña del Mar includes Mall Marina y Mall Centro Curicó 1) Amounts equivalent to the total of the asset weighed by the percentage of Ripley’s ownership 2) Proportional EBITDA of Ripley Corp. EBITDA of Mall Aventura considers three months of Aventura Plaza S.A.’s EBITDA (pre consolidation) weighted by Ripley Corp’s ownership in such company

EBITDA LTM jun-17 increased 3.3%(1) when compared to LTM jun-16, reaching CLP MM$ 38,263

On April 2016 Ripley’s ownership of Inm. Mall Viña del Mar came up to 50% after the purchase of an extra 16.67% of it

Starting 2Q16, Ripley recognizes all of its investments properties at fair value instead of historical cost

On July 2016 the division of Aventura Plaza S.A. was executed and Ripley began to consolidate the operation of Mall Aventura S.A.

CONTINUE GROWING IN OUR REAL ESTATE BUSINESS

9.6819.92912.080

5.369

9.613

12.05410.712

5.884

Mall Aventura S.A. (2)

Total

37.059 38.263

Mall Concepcion & leased

properties

Nuevos Desarrollos S.A.

Inmob. Mall Viña del Mar S.A.

LTM jun-16 LTM jun-17

REAL ESTATE PROJECTS IN CHILE


Mall Plaza Arica (2018)

Mall located in the city of Arica (northern Chile), which has a population of around 4,000 people

GLA: 32,000 m2

Mall owned by Nuevo Desarrollos S.A., where Ripley has 22.5% of the property

Mall Marina Arauco Expansion (Q2 2018)

Mall located in the city of Viña del Mar, which has a population of approximately 287,000 people

Mall owned by Inmobiliaria Mall Viña del Mar S.A., where Ripley shares 50% of the property

Note: In brackets, estimated opening


MALL EXPANSION PLAN IN PERU

Mall Santa Anita Expansion (Q3 2018)

Mall located in the city of Lima in the Santa Anita district, which has an urban population of around 233,000 people

Current GLA: 57,600

GLA of the expansion: 30,212 m2

Mall owned by Mall Aventura S.A., which is 100% property of Ripley

Mall Arequipa Expansion (Q3 2017)

Mall located in Arequipa city, the second most populated city in Peru, which has a population of approximately 877,000 people

Current GLA: 65,300

GLA of the expansion: 7,018 m2




NEW MALL PROJECTS IN PERU

Iquitos project (Q3 2021)

Mall located in the San Juan Bautista district, it will become the first and only mall in the city of Iquitos, which has a population of approximately 432,000 people as well as a large floating population (app. 500,000 people)

GLA: 52,286 m2


San Juan de Lurigancho project (Q3 2021)

Mall located in the district of San Juan de Lurigancho, the largest and most populated one in Peru (population of around 1,110,000 people), which also connects the city north to south

GLA: 64,461 m2



A. RETAIL BUSINESS



D. H1 2017 RESULTS

E. LOOKING FORWARD

H1 2017 v/s H1 2016 OPERATIONAL RESULTS

Note: Amounts in MMCLP

Positive EBIT evolution (+46.3%) due to efficiencies in expenses in Ripley Chile and total revenues rise of 6.0%, attributed to:

Higher same stores sales (“SSS”) in Chile (+7.3%)

Financial revenues grew 5.0%

Consolidation of Mall Aventura S.A. (“Aventura”)

Ripley Corp Chile Peru Central offices &

consolidation adjustments

Consolidated

H1-17 H1-16 Var % H1-17 H1-16 Var % H1-17 H1-16 H1-17 H1-16 Var %

Retail revenues 376,681 350,756 7.4% 188,646 188,131 0.3% (1,882) (1,859) 563,445 537,029 4.9%

Bank revenues 142,982 135,982 5.1% 72,400 69,077 4.8% - - 215,382 205,059 5.0%

Real Estate revenues 3,307 3,204 3.2% 7,973 - - - 11,279 3,204 252.0%

Total Revenues 522,970 489,943 6.7% 269,019 257,208 4.6% (1,882) (1,859) 790,106 745,292 6.0%

Gross profit retail 101,845 94,982 7.2% 46,683 47,979 -2.7% - - 148,527 142,962 3.9%

Gross profit bank 90,574 86,058 5.2% 41,179 43,163 -4.6% - - 131,753 129,221 2.0%

Gross profit real estate 3,307 3,204 3.2% 7,973 - - - 11,279 3,204 252.0%

Gross Profit 195,726 184,244 6.2% 95,834 91,143 5.1% - - 291,560 275,387 5.9%

SG&A expenses (172,863) (172,129) 0.4% (88,850) (82,859) 7.2% (3,195) (2,185) (264,908) (257,173) 3.0%

EBIT 22,863 12,115 88.7% 6,985 8,284 -15.7% (3,195) (2,185) 26,652 18,214 46.3%

IMPORTANT IMPROVEMENT IN COMPANY’S PERFORMANCE

Total Revenues

LTM jun-17

+4.1% +4.7% +2.3% +26.1% +123.7% +98.0% +8.4%

Note: Amounts in MMCLP

Gross Profit SG&A

expenses EBIT

Income before taxes

Income from continued operations

EBITDA

1,643,680 613,600 (540,562) 73,038 106,966 84,039 159,334

1,578,841 586,228 (528,285) 57,942 47,815 42,452 146,989 LTM jun-16

Outstanding

(1) (2) Bonds

Ripley Corp A/Positive A+/Stable 2

Ripley Chile A/Positive AA-/Stable 1

Ripley Bank Chile A+/Stable A+/Stable 5

Ripley Bank Peru AA-/Stable AA-/Stable 4

Bond credit rating / Perspective

As of H1-17, Ripley Corp showed high liquidity and low leverage as well as robust Basel indexes in its banks businesses in Chile and Peru

LEVERAGE, LIQUIDITY & RATINGS

Ripley

Bank Chile Ripley

Bank Peru Total Banks

Retail, Real Estate &

Central Offices

Consolidated Consolidated

jun-17 dec-16

Financial Debt 623,906 356,875 980,782 413,246 1,394,027 1,333,227

Accounts payable related companies 14,396 4,411 18,807 -11,680 7,127 22,394

(+) Financial Debt + AP Related Parties 638,302 361,286 999,588 401,566 1,401,154 1,355,621

Cash & Cash Equivalents 98,747 61,405 160,152 111,266 271,418 234,286

Accounts receivable related companies 4,211 3,694 7,905 -6,033 1,871 3,622

(-) Cash + AP Related Parties 102,958 65,099 168,057 105,233 273,290 237,908

Net Financial Debt 535,344 296,187 831,531 296,333 1,127,865 1,117,713

Equity 193,031 77,321 270,352 649,214 919,566 895,436

Net Financial Debt/Equity 2.77x 3.83x 3.08x 0.46x 1.23x 1.25x

Basel Index 19.0% 14.5%

A. RETAIL BUSINESS



D. H1 2017 RESULTS

E. LOOKING FORWARD

MAIN FOCUS MAIN SOURCE OF GROWTH & PROFITABILITY

RET

AIL

- Fashion & Brands

- Increase Profitability

Increase in margins

through strategic plan focused on brands

Strengthening eCommerce channel

Increase in square meters and higher

store maturity

BA

NK

- Competitive Credit Card

- New Core Banking

System

Migrate known clients to

MasterCard

Keep healthy leverage ratios

Implement electronic accounts, debit cards

and other bank services

Conservative growth leveraging on known

clients

REA

L ES

TATE

- Grow in Mall operations

Greater maturity of existing malls, new malls

under associates and expansion of existing owned malls

Developing new projects

LOOKING FORWARD

Ripley Peru Bank carried out two financial instruments issuances during the quarter. • NCDs: S/ 50 million up to a year • CBs: S/ 50 million up to 2.5 years

Additionally on June 27th 2017, Ripley Bank in Peru distributed S/30 million of dividends to its parent company, for the concept of accumulated earnings from 2016

Peru’s online channel received, for a second consecutive year, the e-Commerce Award to

the Leader of e-Commerce in Retail

During the first quarter of 2017, Mall Aventura sold a land located in Los Olivos, Lima • Sale for an amount of MM$27,541 • Land available for sale with no project associated to it • Income before taxes reached MM$3,904 over the fair value registered

During the month of July began the construction of the expansion of Mall Arequipa in Peru

• This project will add 7,000 m2 of GLA of the mall • Additional revenues estimated for the tenants of S/ 66 million • Its opening is contemplated for the last quarter of 2017

MOST RECENT HIGHLIGHTS

With 60 years of experience in retail, River Island belongs to the Lewis family holding and has over 300 stores throughout UK, Ireland, Europe, Middle East and South Africa

Created in 2001, Sfera is part of the El Corte Ingles Group and has over 200 stores throughout Spain, Portugal, South Arabia, Peru and Mexico. It´s known for its comfortable and fashionable clothes, with trendy accessories for casual young ladies and sophisticated women

Next trades from more than 500 stores in the UK and Eire and around 200 stores in 40 countries overseas

APPENDIX

Highly personalized lifestyle brand with a laid-back take on latest trends. Trucco has over than 240 stores over Europe, Asia, middle east and central America and belongs to In Situ SA

Created by Adolfo Cambiaso in 2004, La Dolfina Polo Lifestyle shares its collection inspired on the most genuine values of this sport

Inspired on the Oslo fashion fair and with a modest but carefully chosen collection aimed at young men, Jack&Jones is one of Europe´s leading producers of menswear with more than a thousand stores throughout Europe, Asia and Canada

APPENDIX

Calderon Volochinsky Family

50%

Calderon Kohon Family

11%

Pension Funds 16%

Mutual Funds 1%

Others 22%

As of August 2017

MAIN SHAREHOLDERS

Calderon Family • Company founded by Calderon Family. • Participation in the company

• 3 members of the family are part of the board of directors. • CEO of Ripley.

• Ripley represents the family´s main investment.

APPENDIX

Documents

Presentación de PowerPointripleyinversionistas.cl/wp-content/uploads/2018/10/... · Note: Amounts in CLP; EBITDA and EBIT LTM (1) Bloomberg, September 29th 2017 (2) Proforma using