s2.q4cdn.coms2.q4cdn.com/740885614/files/doc_presentations/2012/... · 2016-02-11 · 0.9 m il on actv e rds 2 0.3 m il on actv e rds Note: Figures exclude Prezunic (31 stores and

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Cencosud is a leading multi-format retailer in Latin America…

Brazil� 380,845 m2 selling space

� 152 Supermarkets

� 0.9 million active credit cards (JV with Bradesco)

Colombia� 35,360 m2 selling space

� 4 Home improvement sores

Peru� 288,081 m2 selling space

� 74 Supermarkets

� 2 Shopping Centers

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Key metrics (2011)

Supermarkets 189

29

35

9

262

269

48

-

14

331

152

-

-

-

152

74

-

-

2

76

-

4

-

-

4

684

81

35

25

825

Chile� 1,295,240 m2 selling space


� 29 Home improvement stores

� 35 Department stores


� 2.2 million active credit cards

Argentina� 1,121,563 m2 selling space


� 48 Home improvement stores





Note: Figures exclude Prezunic (31 stores and net sales of R$2.2 billion during 2011) acquired on January 2, 20121 As of March 15, 20122 EBITDA, further adjusted to exclude the effect of exchange differences, increase on revaluation of investment properties, results from price level restatement and negative goodwill associated with Johnson’s acquisition

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Stores and shopping centers (2011)

Home Improvement

Department stores

Shopping Centers

Total

Formats Total

… with a well-recognized brand portfolio and integrated multi-format strategy…

Formats

Supermarkets

Department stores

Brands Market position

# 2 Chile and Argentina# 1 Peru# 1 Minas Gerais, # 2 Northeast Region and # 3 Rio de Janeiro (Brazil)

# 2 Chile

Home Improvement

Shopping Centers

Consumer Finance

#1 Argentina# 2 Chile

# 2 Chile# 2 Argentina

Chile: 2.2 million cardsBrazil: 0.9 million cardsArgentina: 0.9 million cardsPeru: 0.3 million cards

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…and a proven track record in successfully integrating acquisitions

And a new cycle ofgrowth has began

2006 2011

# of stores

2011 vs. 2006

Selling space (mm sq. meters)

Net revenues ($ million)

Adjusted EBITDA ($ million)1

486

1.9

5,874

495

825

3.1

15,625

1,287

1.7x

1.6x

2.7x

2.6x

Expansion in key metrics

Market capitalization ($ million) 6,223 13,1082 2.1x2007

2006

2005

2004

2003

2002

2000

1993

1988

1982

1976

2008

2009

Source: Cencosud, FactsetNote: Figures exclude Prezunic (31 stores and net sales of R$2.2 billion during 2011) acquired on January 2, 20121 EBITDA, further adjusted to exclude the effect of exchange differences, increase on revaluation of investment properties, results from price level restatement and negative goodwill associated with Johnson’s

acquisition2 As of December 31, 2011

2010

Opened the firstsupermarket

IPO in the Santiago Stock

Exchange

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2011

2012

Chilean market consolidation

During last five years Cencosud has made 8

acquisitions for more than US$2.2 billions

Revenues evolution (USD$ bn)

EBITDA ($ mm) and EBITDA margin (%) evolution

Revenues and EBITDA continue their positive evolution

5,0 5,98,1 9,4 10,5

12,2 15,6

3,8 4,3

2005 2006 2007 2008 2009 2010 2011 4Q 2010 4Q 2011

+12%

� Revenues in 2011 increased 28%, due mainly to double digit sales growth in all the business divisions

� Consolidation of Bretas and 72 new openings contributed to sales expansion

� Full year EBITDA increased by 19% due to better operations performance

EBITDA ($ mm) and EBITDA margin (%) evolution

412 494 688 667 767

1.050 1,287

333 365

8,2% 8,4% 8,5%7,1% 7,3%

8,5% 8,3%8,4% 8,7%

0%

2%

4%

6%

8%

10%

0

200

400

600

800

1.000

2005 2006 2007 2008 2009 2010 2011 4Q 2010 4Q 2011

Source: CencosudNote: 2005 – 2009 figures in Chilean GAAP while 4Q 2010 and 4Q 2011 figures in IFRS; CAGRs calculated in local currency; Figures exclude Prezunic (31 stores and net sales of R$2.2

billion during 2011) acquired on January 2, 2012 �

+25.2%

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Cencosud’s calculation of

EBITDA includes a non cash

effect that came from currencies

fluctuation (CLP 57,121 mm

higher loss versus 2010).

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Retail operations account for more than 95% of revenues, while Adjusted EBITDA contribution from Brazil has increased to 14%

Diversified revenue breakdown Diversified adjusted EBITDA breakdown1,2

Chile42%

Brazil21%

Peru8%

Colombia1%

Chile50%

Brazil14%

Peru 8%

Food retail54%

DIY12%

Departmentstores

7%

Shopping centers

14%

Financial services13%

Food retail73%

DIY 13%

DepartmentStores

9%

Shoppingcenters

2%

Financial services4%

2011 FY revenues of US$15,625 million

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2011 FY Adjusted EBITDA2 of $1,287 million

Note: Figures exclude Prezunic (31 stores and net sales of R$2.2 billion during 2011) acquired on January 2, 20121 Breakdown excludes Colombia’s EBITDA of (US$43.9mm) and Other segment’s EBITDA of (US$1,758mm)2 EBITDA, further adjusted to exclude the effect of exchange differences, increase on revaluation of investment properties, results from price level restatement and

negative goodwill associated with Johnson’s acquisition

� Diverse operational and geographic footprint

� Supermarkets represent 73% of revenues and core retail operations 96%

� Brazil currently represents 21% and 14% of revenues and Adjusted EBITDA, respectively

� Brazil contribution to increase in following quarters subsequent to acquisition of Prezunic

Argentina29%

Argentina29%

73%

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Although recent acquisition have increased total indebtedness…

Total debt evolution (US$ bn) Net debt evolution (US$ bn)

Capex (US$ mm) excl. acquisitions

377747

1.187

2009 2010 2011

Total debt evolution (US$ bn) Net debt evolution (US$ bn)

2,0

3,13,7

2009 2010 2011

Source: CencosudNote: 2005 – 2009 figures in Chilean GAAP while 2010 and 2011 figures in IFRS. Figures exclude Prezunic, acquired on January 2, 2012

� Increase in financial debt as a result of the acquisition of Bretas (both acquisition funding and debtassumed)

� Issuance of 144A-RegS bond

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2,83,4

4,0

2009 2010 2011

…balance sheet flexibility and solid operational performance have allowed the company to maintain prudent credit ratios

2,7 2,7

3..1

2009 2010 2011

Net debt / EBITDA

3,6 3,0 3,4

2009 2010 2011

Total debt / EBITDA

57% 53%72%

2009 2010 2011

5,2

8,4

5,0

2009 2010 2011

Financial debt / EquityEBITDA / Interest expenses

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Source: CencosudNote: 2005 – 2009 figures in Chilean GAAP while 2010 and 2011 figures in IFRS. Figures exclude Prezunic, acquired on January 2, 2012

Our strategy going forward

� Leverage on multi-format business model to drive traffic in stores

� Materialize synergies across our different business units

� Develop and expand new formats in our key markets

Continue to develop and expand our multi-format and multi-brand approach

Focus on operating margins and cash flows

� Streamlining distribution and back-office capabilities and improving operating efficiencies

� Emphasis on financial discipline resulting in high debt ratings while implementing capital expenditure and expansion plan with sufficient flexibility

� Significant opportunities to increase our presence and market share in Expand through growth in selective

markets

Continue to pursue opportunistic acquisitions while maximizing synergies

Enhance customer loyalty

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� Significant opportunities to increase our presence and market share in selected countries

� Our leading position, focus on improving profitability and store openings track record provide us with a solid foundation for continued growth

� Gain scale and access to attractive locations and strong local brands through opportunistic acquisitions in key markets

� Successful integration of all of our acquisitions will facilitate our ability to implement synergies

� Focus on Brazil and Peru

� Increase our share of our customers’ total retail spending

� Competitive prices, quality products, convenient locations, personalized service and an attractive “one-stop” shopping environment

� Complementary consumer finance services

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�$

137171

55 61

2010 2011 4Q 2010 4Q 2011

EBITDA evolution (US$ mm)Revenues evolution (US$ mm)

Home Improvement: double digit growth led by strong SSS

545473

1.9581.613

2010 2011 4Q 2010 4Q 2011

+21%

+15%

+25%

+12%

2Q09 4Q09 2Q10 4Q10 2Q11 4Q11

Chile Colombia Argentina

Geographical presence and market position

29 stores

#2

4 stores

48 stores

#1

81 stores

SSS evolution by country in local currency

��Source: CencosudNote: Figures in IFRS; Growth rates calculated in local currency

4.8%

13.9%

38.3%

Department Stores: recovering same store sales growth


80 96

32 37

2010 2011 4Q 2010 4Q 2011

439426

1.4221.227

2010 2011 4Q 2010 4Q 2011

+16%

+3%

+20%

+16%

Falabella24%

Paris38%

La Polar16%

Ripley23%

-7.3% -1.9%

4.7%

2Q09 4Q09 2Q10 4Q10 2Q11 4Q11

Chile

Source: CencosudNote: Figures in IFRS; Growth rates calculated in local currency1 As of September 2011, does not include acquisition of Johnson’s

SSS evolution in local currency

35 stores

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40 stores

Market Share by selling space – Chile1

Acquisition of Johnson’s

Transaction summary

� In December 2011, we acquired an 85.58% interest inJohnson’s S.A. (“Johnson’s”)

� Department store chain operating 40 stores throughoutChile under the Johnson’s brand and an additional 13stores using the FES brand

� Adding 120,000 m2 of selling space, representing a44% increase over our existing Paris stores

Financial highlights

� Aggregate purchase price of Ch$32,606 million.Ch$17,576 million used to repay all assumed

Key considerations Selling space expansion (‘000s sq. meters)

120

272238238234

1Q11 2Q11 3Q11 4Q11

Paris Johnson's

392

Largest department store presence in Chile (‘000s sq. meters)Ch$17,576 million used to repay all assumed

indebtedness at Johnson’s, while the rest will be usedfor working capital

� In 2011, Johnson’s registered sales of Ch$118,447million from its retail operations

Integration and objectives

� During the next months, we plan to replace allJohnson’s credit cards with Cencosud credit cards,

� With the acquisition we will improve our coverage ofthe low and middle income market segments in Chile

392

272

243

236

160

Falabella

Ripley

La Polar

(‘000s sq. meters)

+44%

Source: Company filingsNote: Cencosud figures as of 4Q11; other figures as of latest reported date (3Q11)

+

Geographic presence and occupancy rates

#214 Shopping Centers

Gross Leased Area: 227,396 m2

#29 Shopping Centers

2 Shopping CentersGross Leased Area: 54,750 m2

95% occupancy rate

25 Shopping 25 Shopping Centers

Shopping Centers: leading a new cycle of growth

Gross Leased Area: 227,396 m99% occupancy rateGross Leased Area: 282,693 m2

98% occupancy rate

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175 206

62,8 63,2

2010 2011 4Q 2010 4Q 2011

7569

268230

2010 2011 4Q 2010 4Q 2011

+16%

+9%

+17%

+1%

Source: CencosudNote: Figures in IFRS; Growth rates calculated in local currency; figures exclude intercompany operations

Geographic presence and active cards

Total Cards4.2 MM

Financial Services: increasing presence in Peru and stable credit quality

Gross loan portfolio evolution by country (US$ mm)

927 835 770 888 861

11 42 68

176 243 939 877

838

1,064 1,104

2007 2008 2009 2010 2011

Chile Argentina .

� In 4Q11, the company registered an anti-cyclical provision of CLP542mm to anticipate future changes in the macroeconomic environment

� In August 2011, we launched our own private label credit card in Peru. We estimate that we will receive the operation license from SBS in the firstquarter of 2012 and expect to start operations in the second quarter of 2012.

Credit card penetration by division 4Q 2011

Source: CencosudNote: Figures in IFRS; Growth rates calculated in local currency

Loan loss allowance as % of all loans

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2007 2008 2009 2010 2011

7.2%

10.9%

7.6%8.8%

8.0%

7.6%7.5%10.0%

0.2%

2007 2008 2009 2010 2011

Chile Argentina54% 21% 20% 8%

Departmentstores

Homeimprovement

Hypermarkets Supermarkets

9%18%

Home improvement Hyper/Supermarkets

Chile

Argentina

183 stores1

North East Region (34%)

State of Minas Gerais (23%)

Rio de Janeiro (13%) #3

74 stores#1

#1

#2

Supermarkets: Supermarkets: leading position in Peru, Chile and Argentina, and runner up in Brazil

Peru

Chile

Brazil

Argentina

45% 35%20%

Cencosud SupermercadosPeruanos

Falabella

Source: Public filings, Planet Retail, ABRAS, INDECNote: Market share in terms of sales; Chile and Peru figures as of September 2011; Peru market share estimated based solely on reported sales from the three main competitors1 Includes Prezunic acquisition (31 stores) in Rio de Janeiro

269 stores

#2

684 stores684 stores

189 stores#2

* Dia Stores not include

� In the last 12 months, the Supermarket division added 72 stores

Chile Argentina

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34% 27%22%

Wal-Mart Cencosud SMU

20%16% 14%

Carrefour Cencosud Wal-Mart

606777

167 211

2010 2011 4Q 2010 4Q 2011

EBITDA breakdown by country, 2011

Revenues evolution (US$ bn) EBITDA evolution (US$ mm)


Supermarkets: strong performance in Chile, Argentina and Peru

3,12,7

11,58,8

2010 2011 4Q 2010 4Q 2011

+31%

+13% +27%

+28%

Chile33%

Argentina28%

Peru11%Brazil

28%

EBITDA breakdown by country, 2011

Source: CencosudNote: Figures in IFRS; Growth rates calculated in local currency; Figures exclude Prezunic (31 stores and net sales of R$2.2 billion during 2011) acquired on January 2, 2012


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2Q09 4Q09 2Q10 4Q10 2Q11 4Q11

Chile Brazil Argentina Peru

4.6%

-0.3%

8.7%

22.8%

… and significant opportunities to capitalize in Brazil during the next months

Cencosud expects to capture the upside potential in the Brazilian retail market…

� Retail sales expanded 2.6% YoY in January, with hyper/supermarket sales leading the way with a 7.4% MoMincrease (compared to -1.4% in December)

� Attributable to a sustained increase in the population’s purchasing power, mainly driven by the rise in the volumeof employed persons’ real income, job stability and increase in demand

… through its leadership position in attractive markets…

� Cencosud is currently the number four player in the food retail segment in Brazil, with a 4% market share

� However the company has a leading position in the regions where it has presence.

� Minas Gerais alone, where Cencosud holds the #1 position with 43 stores, is a state of ~20mn inhabitants, with aper capita income similar to that of Chile (#2 position, 17mm inhabitants and 189 supermarkets)

� Strong entry into Rio de Janeiro, one of the most densely populated areas in the country

… and its demonstrated successful operational strategy implemented at GBarbosa during the last years…

� At the time of GBarbosa’s acquisition, the operation was 1/7 the size of WalMart in North East Brazil

� Today GBarbosa’s turnover is roughly ½ of WalMart in the region

� Selling area has increased by approximately 80% since 2007, adding 65 thousand sq. meters

� Key drivers of success have focused on high level of service, wide assortment of items in compact locations,flexible credit offerings and attractive pricing

… to be replicated in all formats along with other key initiatives and value creating opportunities

� Same store sales to expand in addition to growth in selling space and expansion of existing formats

� Increase penetration in non-food items: higher electronics offerings in new Bretas stores (7% vs 1.5%)

� Introduction of private label brands (< 3% in GBarbosa and non in Bretas)

� Roll-out of credit card operations into other formats, to incentivize on-site spending, especially in non-food itemsand enhance customer loyalty through attractive credit offerings

17.9 CBD

The Prezunic acquisition positions Cencosud as a leader in yet another regional market in Brazil…

Geographic presence

National ranking market share (%)

9

4

19

894

41

22

71

17.9 CBD

� Increase exposure to Brazil

� Market with attractive retail fundamentals� Acquisition of a leader in the Rio de Janeiro market� Substantial growth opportunities� Value creating transaction to Cencosud shareholders

Investment Highlights

14.4

11.1

2.7

1.2

1.2

1.0

0.9

0.9

Carrefour

Wal-Mart

Cencosud

Zaffari

Prezunic

DMA

Angeloni

COOP

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Source: Company filings, Planet Retail, ABRAS, IBGENote: Market share by % of industry’s gross revenues

52

31

GBarbosa Supermarkets (including Eletro Show and pharmacies)Perini

Legend

Mercantil Rodrigues

Bretas Supermercados

Prezunic Supermercados

#1 Minas Gerais#2 Northeast region#3 Rio de Janeiro

14.4

11.1

3.9

1.2

1.0

0.9

0.9

Carrefour

Wal-Mart

Cencosud

Zaffari

DMA

Angeloni

COOP

Present in 8 states accounting for approximately 33% of national GDP with aggregate real GDP growth (2005-

2009) of 3.4% and 78.6mm inhabitants

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Documents

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