Corporate Presentation Third Quarter 2016 Corporate Presentation - PowerPoint PPT Presentation

Corporate Presentation | 1 Corporate Presentation Third Quarter 2016

Corporate Presentation | 2 INDEX Highlights Third Quarter Cencosud Snapshot Strategy Cencosud Financials Corporate Governance 2

Corporate Presentation | 3 HIGHLIGHTS THIRD QUARTER Revenue expansion in local currency in all markets, except Brazil. Revenue • decreased 6.6% YoY in CLP as a result of the devaluation of the Argentine peso (38.3%), Peruvian sol (5.9%) and Colombian peso (4.3%). Increased traffic in Supermarkets Chile, and Department Stores Chile and Peru • Better SSS performance in Chile, Argentina and Brazil when compared to 2Q16 • Despite currency devaluation, Adjusted EBITDA grew 11.5% and margin • expanded 100 bps, mainly driven by improved performance at most operations and a low comparison basis . Non recurring events resulting from the implementation of the strategy to • drive sustainable profitable growth: Divestiture of Teleticket in Peru • Severance payments and provisions of inventory obsolescence in 3Q15. • Net profit reached CLP 34,950 million, reflecting a CLP 64,851 million • increase due to better performance at most operations, the positive impact of the exchange difference and non-recurring events in 3Q15. 3

Corporate Presentation | 4 INDEX Highlights Third Quarter Cencosud Snapshot Strategy Cencosud Financials Corporate Governance 4

Corporate Presentation | 5 CENCOSUD IN THE REGION    102 Supermarkets   244 Supermarkets 89 Supermarkets 285 Supermarkets 209 Supermarkets    10 Home Improvement   35 Home Improvement 9 Department Stores 51 Home Improvement JV with Bradesco    2 Shopping Centers 78 Department Stores  4 Shopping Centers 22 Shopping Centers   JV with Colpatria 25 Shopping Centers  JV Scotiabank Since Since Since Since Since 1978 1982 2007 2008 2012

Corporate Presentation | 6 Regional Presence / Market Position 3º SUPERMARKETS 2º HOME IMPROVEMENT 4 º SUPERMARKETS NORTHEAST (#2) MINAS GERAIS (#1) RIO DE JANEIRO (#3) 1 st SUPERMARKETS 4 th DEPARTMENT STORES 2 º SUPERMARKETS 2 º HOME IMPROVEMENT 2 º SHOPPING CENTERS 2 º SUPERMARKETS 2 º DEPARTMENT STORES 1 º HOME IMPROVEMENT 2 º SHOPPING CENTERS

Corporate Presentation | 7 Opportunities by Country - Chile  A country with a solid economy, growing below its potential  Key openings for our main brands  Landbank of 2.7 mm sqm  Full multiformat, 6 retail flags + shopping + financial services  Strong growth of the financial business together with scotiabank  Leaders in e-commerce food, strong growth in non-food  Costanera project expansion

Corporate Presentation | 8 Opportunities by Country - Argentina  We expect a change in the economy trend for 2017:  Strong project pipeline, in our own land  Closeness format at Jumbo  The market is increasing its formality level  The market is opening to imports  We are leaders in e-commerce  Consolidated team / strong local player

Corporate Presentation | 9 Opportunities by Country - Brazil  End of recession, growth from 2018  Renowned brands, with history and prestige in their markets  We have a successful Atacarejo format, with positive growth  We have built a local team of excellent level, acknowledged by the market  Transformational initiatives in supply chain, pricing, selection and efficiency  Commercial synergies, improving margin and competitiveness

Corporate Presentation | 10 Opportunities by Country - Peru  Political change, confidence in the country’s economy  Higher growth and lower inflation expectations  Young country: 2/3 of the population in full production, savings and investment capacity  Low penetration of the modern channel  Potential for a 3 times growth of Paris share  Excellent land bank  Wong with an unbeatable positioning in the high segment  The best loyalty program - bonus  Strong development of own brand

Corporate Presentation | 11 Opportunities by Country - Colombia  Consolidated team with experience in the local market  We grow more than our main competitors  Omnichannel, e-commerce and telephone sales development  Profitability opportunity for our current assets  Our brands are consolidating  Great development potential together with landbank and unrivalled locations  Easy format showing 2-digit growth for the last 2 quarters

Corporate Presentation | 12 Strong Brand Portfolio, 87 with high consumer recognition Department Stores 96 53 Shopping Centers Home Improvement 929 High and low end brands Supermarkets

Corporate Presentation | 13 Overview by Country: Colombia REVENUES 8% Peru 10% Revenues LTM in USD 1 Chile 41% Revenues LTM in Andean Region Atlantic Cost Brazil USD 16,012 MM 15% 6,529 USD MM 2,391 USD MM 1,533 USD MM 4,218 USD MM Argentina 26% 1,341 USD MM 1 Exchange rate: September, 2016 (CLP/USD = 658,0)

Corporate Presentation | 14 Overview by Country: Colombia Adjusted EBITDA 5% Peru 10% EBITDA Ajustado 2 LTM USD 1 Brazil 1% Costa Atlántica Región Andina Adjusted EBITDA LTM USD 1,261 690 USD MM Chile 17 USD MM 55% MM Argentina 29% 130 USD MM 366 USD MM 58 USD MM 1 Exchange rate: September, 2016 (CLP/USD = 658,0) 2 Adjusted EBITDA: corresponds to EBITDA +/- Exchange variations +/- Assets Revaluation +/- Result of Indexed Units

Corporate Presentation | 15 Overview by business: REVENUES Shopping Centers 2% Financial Services Revenues LTM in USD 1 Department 2% Stores 10% 266 USD MM 11,604 USD MM Home Revenues LTM Improvement 13% USD 16,012 377 USD MM 2,061 USD MM MM 1,686 USD MM Supermarkets 73% 1 Exchange rate: September, 2016 (CLP/USD = 658,0). Segment “Others”, revenues: USD 18 MM. 2 Shopping Centers figures only reflect contribution by third parties

Corporate Presentation | 16 Overview by business: Adjusted EBITDA EBITDA Ajustado LTM USD 1 Shopping Centers 20% 106 USD MM 712 USD MM Adjusted EBITDA Financial Services Supermarkets LTM USD 1,261 8% 52% 278 USD MM 194 USD MM Department MM Stores 6% 84 USD MM Home Improvement 14% 1 Exchange rate: September, 2016 (CLP/USD = 658,0). Segment “ Others”, EBITDA: USD -113 MM. 3 Shopping Centers figures only reflect contribution by third parties

Corporate Presentation | 17 A Develoment story thru Organic Growth & Acquisitions 1 16,7 16,2 16,0 15,5 14,3 11,8 9,7 9,5 8,6 5,9 4,8 3,9 2,2 1976 1982 1988 1993 2000 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 3Q16 1 Consolidated revenue values in USD MM using exchange rates at the end of each period. LTM

Corporate Presentation | 18 INDEX Highlights Third Quarter Cencosud Snapshot Strategy Cencosud Financials Corporate Governance 18

Corporate Presentation | 19 19 Guidance and Investment Plan 2016 - 2019 Distribution by type of investment For the period 2016-2019 investment 18% Organic Growth and Renovation Organic contemplates US$ 2.500 million, to be Technology, Logistics Growth Plan financed mainly by the generation of own 22% & Omnichannel 60% resources Maintenance & Current Capex 1. Cost Efficiency and Profitability 2. Omni-quality Working 3. Financial Strengthening Spotlights 4. Shopping Centers IPO 5. Non-strategic assets divesting

Corporate Presentation | 20 20 Strategic Pillars – 1.Clients Internal Client Happine iness ss at Work and Pr Productiv ivit ity CENCOSUD DNA We define 6 key competences that build Culture 1. Customer - Centered 2. Individual talents at the service of the Team 3. Permanent evolution and challenges 4. Strong culture focused on People 5. Owner Mentality 6. Accountability Consumer From t m transac saction ion to emo motion ion 1. Promises generation 2. Focus on the experience as a central axis 3. Authority in relevant / available categories 4. Check out speed 5. Speed and impeccability in post sale service 6. CRM: knowledge and fidelization

Corporate Presentation | 21 21 Strategic Pillars – 2.Trends 1. Sustainability & Entry to DJSI 2. Healthy Life 3. Omnichannel Strategy Development 4. Fidelity & Datamining 5. Mobility

Corporate Presentation | 22 Strategic Pillars – 3. Profitability  Corporate Strategy Plan 1. Review of the route and role of each business unit within the portfolio 2. Ensure capital allocation alignment 3. Same methology for the entire organization  Productivity and Efficiency 1. Review of structures and headcount 2. Non-core assets and landbank divestiture 3. Inventory health (Aging) 4. Energy Efficiency 5. Organic growth 6. SG&A growing below income 7. Centralization of productive processes 8. Technology at the service of stores and costumers  Program for Stores with Negative EBITDA  Own Brands  Regional Trade Synergies

Corporate Presentation | 23 INDEX Highlights Third Quarter Cencosud Snapshot Strategy Cencosud Financials Corporate Governance 23