GRUPO TRAXION CORPORATE PRESENTATION JULY 2019
DISCLAIMER The information contained in this document is strictly confidential and is subject to the provisions established in the Securities Market Law regarding the obligations of confidentiality and disclosure or transfer of privileged information. This document can be used exclusively by the receiver as an investor or possible investor of Grupo Traxion, S.A.B. of C.V. ("Traxion"), otherwise, the information contained in this document may not be disclosed without the prior authorization of Traxion. Certain information included in this document may contain certain future statements and information that reflects plans, objectives, expectations, estimates, and intentions. Derived from several risks and uncertain future events, the fulfillment of the same could differ materially from what is mentioned in said forward-looking statements and information that reflects plans, objectives, expectations, estimates, and intentions. Neither Traxión nor any of its affiliates, directors, officers, agents or employees shall be liable to third parties for any investment, business decision or actions taken based on the information and statements contained in this document. 2
TRAXION: THE LEADING COMPANY OF MOBILITY AND LOGISTICS SERVICES IN MEXICO MOBILITY SERVICES 59% 41% People Products and Goods PERSONNEL AND STUDENT TRANSPORTATION CARGO AND LOGISTICS REVENUE BREAKDOWN Corporate and industrial personnel Cargo and logistics services through the entire transportation, student transportation and transportation supply chain charter services Fleet: +8,000 +427,000 sqm +1,000 7 Power Units 3PL logistics area Clients Highly-renowned companies SUPERIOR EXECUTION CAPABILITIES 3
TRAXION: THE LEADING COMPANY OF MOBILITY AND LOGISTICS SERVICES IN MEXICO CARGO & LOGISTICS: Mobility of products and goods BRANDS The broadest portfolio of cargo and logistics integrated services in the market SERVICES ▪ ▪ Domestic cargo FLEET (2Q19) Specialized cargo (petrochemicals and materials) ▪ ▪ ▪ 2,114 trucks and thortons International cargo & transfers 3PL Logistics ▪ ▪ ▪ 600 last-mile units Intermodal cargo Last mile CERTIFICATIONS ▪ +4,000 trailers: dry, refrigerated, hoppers ▪ ▪ Less-than-Truckload (LTL) Packaging and courier and platforms ▪ ▪ Refrigerated cargo Moving and relocation 3PL LOGISTICS SPACE ▪ 427,008 SQM Only supplier of integrated solutions through the entire transportation and logistics supply chain in Mexico MANUFACTURE CUSTOMS/PORTS STORAGE DISTRIBUTION RETAIL/E-COMMERCE CONSUMER INTERNATIONAL INTERNATIONAL DOMESTIC CARGO WAREHOUSE “HARD TICKET” CARGO CARGO MANAGEMENT AND MOVING RETAIL CUSTOMS/PORTS SUPPLIER MANUFACTURER DISTRIBUTION CENTER CONSUMER E-COMMERCE DOMESTIC CARGO INTERMODAL CARGO LOGISTICS LAST MILE 4
TRAXION: THE LEADING COMPANY OF MOBILITY AND LOGISTICS SERVICES IN MEXICO PERSONNEL & STUDENT TRANSPORTATION: Mobility of people Leading player both national and regional, with the largest footprint and infrastructure in Mexico BRANDS SERVICES CERTIFICATIONS FLEET ▪ Personnel transportation 3,399 2016 ▪ Student transportation 3,833 2017 ▪ Charters Ranking Super Companies: in process of 4,039 2018 certification with Top Companies 5,373 2Q19 COMPETITIVE ADVANTAGES ▪ +65 years of experience in the market through different brands ▪ State-of-the-art technological platform ▪ +500,000 people transported daily Pioneer and innovator of the personnel and student transportation industry in Mexico Corporate offices Corporate staff Industrial parks and manufacturing hubs Manufacturing personnel PERSONNEL TRANSPORTATION Hotels, resorts and communities Service personnel Students STUDENT TRANSPORTATION Schools and universities Private-group trips Charters CHARTERS 5
WHY INVEST IN TRAXION? SUSTAINABLE GROWTH INNOVATION AND SCALE EFFICIENCY AND TRANSPARENCY AND TECHNOLOGY PROFITABILITY INSTITUTIONALIZATION TRAXION… TRAXION has: TRAXION… TRAXION… TRAXION… … has a diverse and flexible fleet, … is able to generate an operating … has an entrepeneurial and ▪ State-of-the-art, tailored … is the first consolidator in a +2.5x larger than that of the next leverage, driven by purchasing innovative team with superior support systems focused on highly fragmented industry competitor power, capacity and volume execution capabilities efficiency and profitability dominated by family-owned companies … operates more than 427,000 … has a long-term, continuous and … was created as an ▪ Internally-developed systems sqm of 3PL logistics warehouse sustainable synergies approach institutional company … operates in a sector with • 24/7 monitoring and strong fundamentals and growth … has a diverse customer base of … has a proven business model … is the only company in the tracking potential more than 1,000 clients with a with a successful acquisition and industry backed by two private strong presence in several integration track-record equity funds • Telemetry and information + Accelerated growth in recent industries and various regions … has maintained and improved … is the first transportation systems for continuous with strong economic indicators years through: its operating margins during company to develop a best- improvement and training … has a workforce of more than economic cycles practices approach ▪ Solid capital structure; • 14,200 employees Commercial intelligence … is the first and only company ▪ Profitable and effective of its kind to carry out an Initial • Operational intelligence investment process Public Offering in financial markets • Optimal fleet maintenance + Also … ▪ EBITDA CAGR ‘17 - ’19E: 33% ▪ Fleet growth: 51x from 2011 to 2Q19 6
ACCELERATED AND PROFITABLE GROWTH EBITDA REVENUE CAGR ‘16PF - ’19E: 22.8% CAGR ‘16PF - ’19E: 23.3% 19.4% 17.8% 19.0% 19.8% 15.2% 20.2% 19.1% 21.0% 17.3% 20.6% 11,283 2,231 9,403 1,785 102.3% 50.8% 71.4% 52.5% 37.2% 44.2% 7,072 6,100 1,259 5,904 5,642 1,218 3,911 1,116 1,191 854 3,043 4,095 2,311 2,382 350 710 542 2,836 3,069 605 646 572 1,859 1,792 2,236 428 1,255 1,126 285 371 282 257 955 837 202 169 3,790 4,029 5,491 5,642 1,022 1,709 1,281 1,813 2,303 3,522 731 645 949 1,116 127 330 228 356 356 687 2016PF* 2017A 2018A 2019E 1Q18 1Q19 2Q18 2Q19 1H18 1H19 2016PF* 2017A 2018A 2019E 1Q18 1Q19 2Q18 2Q19 1H18 1H19 NET INCOME OPERATING CASH FLOW 824 434 786 337 250 464 434 154 396 101 322 83 71 35 232 222 2016PF* 2017A 2018A 1Q18 1Q19 2Q18 2Q19 1H18 1H19 10 -149 2016PF* 2017A 2018A 1Q18 1Q19 2Q18 2Q19 1H18 1H19 Cargo & logistics Personnel & student transportation TRAXION Figures in million pesos (MXN) *Pro-forma figures for acquisitions in 2016 7
POSITIVE GROWTH PROSPECTS FAVORABLE DEMOGRAPHIC PROFILE DEMOGRAPHIC PYRAMID 1 – Mexico >85 Women Men Demographic bonus 65.2% of the Drives Years Emerging middle- population is Internal class between 15 Consumption and 65 years old Employment level MANUFACTURING AND INDUSTRIAL ACTIVITY EXPORTS 2018 2 – Billion USD 450.6 Installed manufacturing 1.9x capacity 239.7 Attractive Investment Geographic location Destination 75.5 61.6 48.9 41.8 Qualified and skilled workforce México Brasil Chile Argentina Perú Colombia 1 INEGI 2 World Trade Organization 8
SECTOR WITH SOLID FUNDAMENTALS AND POSITIVE OUTLOOK TRAXION is the leading company in a sector trending towards intitutionalization and high growth LARGE COMPANIES HAVE SHOWN GREATER GROWTH… …IN A KEY SECTOR TO MEXICO´ S ECONOMY CAGR ’13 - ’18 CARGO TRANSPORTATION ▪ The transportation industry in Mexico represents 5.6% of GDP Thousand of power units 983 6.2% ▪ Within the industry, cargo and passenger transportation are the most relevant 917 865 806 763 10.0% 299 729 272 246 Passenger 222 202 transportation 186 Cargo 5.6% 162 152 31.8% transportation 143 133 127 123 50.7% 290 5.2% 273 260 245 235 226 3.6% 221 232 206 215 194 199 2013 2014 2015 2016 2017 2018 CAGR ’14 - ’18 PASSENGER TRANSPORTATION Thousand of power units 58 3.9% 55 Services 51 49 7.7% 48 Air 34 6.3% 3.2% 32 Rail 29 27 Storage and 27 3.1% Maritime refrigeration 1.2% Pipeline 1.2% 1.2% 3.1% 13 ▪ 12 12 12 Contribution to GDP is lower in other countries: 11 1.5% ➔ 4.6% of GDP 7 7 7 7 7 5.7% 4 3 3 3 3 ➔ 3.0% of GDP 2014 2015 2016 2017 2018 ➔ 5.0% of GDP Owner-operator Small companies Medium companies Large companies (1-5 units) (6-30 units) (31-100 units) (>100 units) Source: Transportation Minisitry (SCT) 9
STATE-OF-THE-ART TECHNOLOGICAL PLATFORM RESULTS BASIC FOUNDATIONS SUPPORT SYSTEMS + Tailored support systems Constant innovation Efficient fleet management EFFICIENCY Telemetry and safety Initiatives plan protocols Constant tracking and Best practices PROFITABILITY monitoring Commercial and business Robust platform + Internally-developed systems intelligence ▪ Business management ▪ Commercial inteligence CLIENT ▪ SATISFACTION Telemetrics Commercial and IT Committee ▪ 3PL logistics & warehouse administrative support management 10
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