Corporate Presentation Cencosud – Second Quarter 2011
The information contained herein has been prepared by Cencosud S.A. (“Cencosud”) solely for informational purposes and is not to be construed as a solicitation or an offer to buy or sell any securities and should not be treated as giving investment or other advice. No representation or warranty, either express or implied, is provided in relation to the accuracy, completeness or reliability of the information contained herein. Any provided in relation to the accuracy, completeness or reliability of the information contained herein. Any opinions expressed in this presentation are subject to change without notice and Cencosud is under no obligation to update or keep current the information contained herein. The information contained herein does not purport to be complete and is qualified in its entirety by reference to more detailed information appearing elsewhere, if any. Cencosud and its respective affiliates, agents, directors, partners and employees accept no liability whatsoever for any loss or damage of any kind arising out of the use of all or any part of this material. This presentation may contain statements that are forward-looking subject to risks and uncertainties and factors, which are based on current expectations and projections about future events and trends that may affect Cencosud’s business. You are cautioned that any such forward-looking statements are not guarantees of future performance. Several factors may adversely affect the estimates and assumptions on which these of future performance. Several factors may adversely affect the estimates and assumptions on which these forward-looking statements are based, many of which are beyond our control. �
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Real GDP growth Unemployment rate Gross debt / GDP Source: IMF �
5 countries 753 stores 25 shopping centers 122,000 employees 122,000 employees 2.8 mm sq2 selling space �
Revenues evolution (USD bn) + 20% + 37% 12,2 12,2 10,5 2,58 9,4 2,5 8,1 5,9 5,0 3,8 2,8 2005 2006 2007 2008 2009 2010 2Q 2010 2Q 2011 Strong increase in sales supported by: � The consolidation of Bretas in Cencosud (represents 39% of the increase) � As of 2Q11 the Company added 103 supermarkets (including 66 Bretas stores), 3 Home Improvements, 5 Department Stores and 1 shopping center in Chile Home Improvements, 5 Department Stores and 1 shopping center in Chile � High inflation and strong consumption levels in Argentina (sss for Home Improvement +26% and Supermarkets +23%) � In all countries the Supermarket and Home Improvement Divisions achieved positive levels of SSS Source: Cencosud Note: 2005 – 2009 figures in Chilean Gaap while 2Q10 and 2Q11 figures in IFRs �
Sales breakdown by business – 2Q 2011 Sales breakdown by country – 2Q 2011 Shopping Financial Centers Services Department 2% 4% Stores 9% Home Improvement (31%) (31%) 12% (47%) (47%) Supermarkets 73% (10%) (10%) (%) 2Q 2010 (%) 2Q 2010 (12%) (12%) � The sales breakdown by divisions has been stable to 2010 and the previous quarter � Brazil was the country with further growth of the group, due to the incorporation of Bretas in October 2010 (5 th largest operator of supermarkets in Brazil at that time) � Chile remains the largest country in term of sales Fuente: Cencosud Note: 2005 – 2009 cifras en GAAP Chileno, en el 2 trimestre 2010 y 2011 están en IFRs �
EBITDA evolution (USD mm) 39% + 20% Mg. 8.6% Mg 8.6% Growth in EBITDA reflects an improved performance in the five divisions, despite 2010 bases of comparison very high due to both, the effect of Chilean earthquake and World Cup The EBITDA in 2011 includes expenses associated with the expansion of our operations : � Start-up expenses of shopping center division (Chile and Peru) � Expenses related to building up the credit card operation in Peru Fuente: Cencosud Note: 2005 – 2009 cifras en GAAP Chileno, en el 2 trimestre 2010 y 2011 están en IFRs �
EBITDA by country ² – 2Q 2011 EBITDA by Business Units¹ – 2Q 2011 Financial Services 16% ��������� ��������� ��� Shopping Centers ���� 14% ����� Supermarkets �� 55% 55% 53% ��� ������ Department Home ��� Stores Improvement 9% 14% (%) 2Q 2010 (%) 2Q 2010 8% 8% 6% 6% � Department Stores achieved an Ebitda margin of 9.3% in 2Q11, confirming its focus on improving the efficiency, which occurs in a context of sharp increase in selling space coupled with cost-cutting � Brazil increased its EBITDA contribution from 6% in 2Q10 to 13% in 2Q11, reflecting the consolidation of Bretas and its fast improve in margins Source: Cencosud ¹ Other businesses which account for (10%) are not included. ² Colombia EBITDA (1%) is not included. �
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66 stores #1 137 stores #2 North East Region (34%) Minas Gerais (23%) Minas Gerais (23%) #1 #1 172 stores 256 stores #2 #1 27% 17% 20% 20% 12% 10% 736 tiendas 736 tiendas 736 tiendas * Cencosud Carrefour Coto Wal-Mart * Dia Stores not include � In the last 12 months the Supermarket division added 103 stores (66 stores after the acquisition of Bretas) � Peru in 2011 has achieved positive and increasing SSS (+1.7% in 1Q11 and +4.5% in 2Q11) reflecting the positive effects of adjustment in their business strategy Source: Cencosud and AC Nielsen ��
EBITDA evolution (US$ mm) Sales evolution (US$ bn) +23% +21% CAGR CAGR +19% +41% Mg 7.0% Mg 6.9% EBITDA breakdown by country, YTD 2Q 2011 SSS evolution by country 2Q 2011 ����� ����� ����� ��� ������ ������ ����� ����� ����� ������� ��� ��� ������ ���� ��������� ���� ���� ���� ���� ���������� ���� ���� ���� ��� ����� ����� Fuente: Cencosud ���� ���� ���� ���� ���� ���� ���� ���� ���� ���� Note: 2005 – 2009 cifras en GAAP Chileno, en el 2 trimestre 2010 y 2011 están en IFRs ��
EBITDA evolution (USD mm) Sales evolution (USD mm) +29% +20% CAGR CAGR +18% +22% Mg 6.7% Mg 6.5% SSS evolution per country - 2Q 2011 Market position ����� �������� ��������� 82 stores 82 stores ����� ����� ����� 4 stores ����� ����� ���� 29 stores ���� ���� ���� ���� ���� ���� ���� ���� ���� ���� 49 stores #2 ����� #1 Fuente: Cencosud ������ Note: 2005 – 2009 cifras en GAAP Chileno, en el 2 trimestre 2010 y 2011 están en IFRs ��
EBITDA evolution (USD mm) Sales evolution (USD mm) +9% +44% CAGR +22% CAGR 18% 1.227 80 80 804 33 27 353 300 13 2005 2010 2Q 20102Q 2011 2005 2010 2Q 2010 2Q 2011 Mg 9.1% Mg 9.3% SSS evolution per country - 2Q 2011 Market Share 1Q11 ��� � 35 stores 35 stores La Polar Paris 13% 26% Ripley 23% ����� Falabella ����� 39% Source: Company reports. Considers only department stores that disclose retail sales ���� ���� ���� ���� ���� ���� ���� ���� ���� ���� Fuente: Cencosud Note: 2005 – 2009 cifras en GAAP Chileno, en el 2 trimestre 2010 y 2011 están en IFRs ��
EBITDA evolution (US$ mm) (1) Sales evolution (US$ mm) +5% +10% CAGR CAGR +18% +52% Mg 60% Mg 77% High occupancy rates in our malls 25 Shopping Centers 2 Shopping Centers 65,763 m 2 65,763 m 96% occupancy rate #2 #2 14 Shopping Centers 9 Shopping Centers 582,241 m 2 55% 487,927 m 2 99% occupancy rate 45% 39% 97% occupancy rate Fuente: Cencosud Note: 2005 – 2009 cifras en GAAP Chileno, en el 2 trimestre 2010 y 2011 están en IFRs ��
Gross loan porfolio per country (USD mm) Loan loss allowances as % of total porfolio Penetration of Credit Card by Division 2Q 2011 Active credit Cards Total cards 4.0 MM JV with Bradesco JV with Bradesco 0.9 MM Cencosud¹ 0.3 MM Cencosud 2 MM Cencosud Source: Cencosud 0.8 MM Note: 2007 – 2009 figures in Chilean GAAP while 2010 and 2011 figures in IFRS. ¹ Since July 2010 ��
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Capex (US$ mm) excl. acquisitions +83% +82% Net debt evolution (US$ bn) Total debt evolution (US$ bn) � Bretas was financed with internal funds and additional debt (USD 290 MM). � Bretas added USD 70 MM debt � The procedures of the international bond are being used to prepay debt due in 2011-2012 and 2013 Source: Cencosud Note: 2005 – 2009 figures in Chilean GAAP while 1Q 2010 and 1Q 2011 figures in IFRS. ��
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