Cos osco Cap apital, In Inc. Investor Pres esentation 9M2 - - PowerPoint PPT Presentation

Investor Pres esentation 9M2 9M2016 Fina Financial Res esults & Perf erformance Novem ember 15, 15, 201 2016

Cos

• sco Cap

apital, In Inc.

1

DI DISCLAIMER

These presentations and/or other documents have been written and presented by COSCO CAPITAL, INC. (COSCO). COSCO is solely responsible for the accuracy and completeness of the contents of such presentations and/or other

• documents. Third parties, other than COSCO, do not have any responsibility for
• r control over the contents of such presentations and/or other documents. No

endorsement is intended or implied notwithstanding the distribution of this presentation and/or other documents during the analysts and investors calls and meetings of COSCO. The materials and information in the presentations and

• ther documents are for informational purposes only, and are not an offer or

solicitation for the purchase or sale of any securities or financial instruments or to provide any investment service or investment advice.

2

Head Offi fice ce Address ss 2nd floor, Tabacalera Building, 900 Romualdez Street, Paco, Manila, 1007 Philippines

Ag Agenda

• Company Overview
• Corporate Structure
• Our Subsidiaries
• Company Milestones
• 9M2016 Consolidated Financial Results
• Core Businesses
• Grocery Retailing
• Liquor Distribution
• Specialty Retailing
• Commercial Real Estate
• Key Initiatives for FY2016
• Q&A

3

Co Company Overview

Corp Corporate Stru tructure

100% 100% 100% 100% 100% 90% 51% 51%

• Ellimac Prime Holdings,

Inc.,

• Fertuna Holdings Corp.,
• Patagonia Holdings

Corp.,

• Nation Realty, Inc.
• NE Pacific Shopping

Centers Corporation

• Pure Petroleum Corp.,

Luci cio Co Co Family 73% 73% Public 27% 27%

5

Groce cery ry Retail ilin ing Liquor r Distrib ibution Sp Specia cialt lty Retail ilin ing Com

• mmercia

ial l Real l Estate

Our ur Sub ubsidiari ries es

Groc

• cery Retai

ailin ling Li Liqu quor

• r Di

Distr tribu bution ion

Puregold Price Club, , Inc.

• 2nd largest grocery retail chain in

the Philippines

• Nationwide

presence with 268 stores across the country S&R &R Me Membersh ship Shopping g Club

• Pioneer and dominant player in

membership club retailing

• 11

warehouses and 21 Quick Service Stores (“QSR”) nationwide

• Leading player in the premium

wine and liquor distribution industry

• Covers 90% of imported wine and

liquor in the Philippines

• Global brands such as Jose Cuervo,

Alfonso, Johnnie Walker and other well-known imported names

Spe pecia ialty lty Retaili iling Com

• mmercia

ial l Real al Es Estate

Liquigaz az Philippines s Corp rporati tion

• 2nd largest liquefied petroleum gas

(“LPG”) supplier in the Philippines Offi ffice War arehouse se, , Inc.

• Office

and school supplies, furniture and technology products

• 64 retail outlets nationwide
• Commercial Real Estate portfolio

includes community malls, commercial buildings, land for long-term lease

• 38 commercial properties located

mostly in the Metro Manila area as well as in neighboring provinces of Luzon

6

Com Company Miles Milestones

2013 2014 2015

April 22 22: Approval by the Securities and Exchange Commission (SEC)

• f

change in corporate name and increase in capital stock of Parent company. May 31 31: Implementation of issuance and listing of new shares, cross trade at the Philippine Stock Exchange (PSE) of PGOLD shares to the Parent company, issuance of shares to the subscribers pursuant to share swap, special block sale at the PSE of new shares. February 3

 Puregold Price Club, Inc. acquired nine (9)

supermarkets from NE Incorporated.

 Cosco Capital, Inc. through its wholly-

• wned subsidiary, Ellimac Prime Holdings,

Inc., acquired four (4) commercial properties from NE Incorporated August 5: through wholly-owned subsidiary, Ellimac Prime Holdings, Inc. acquired RFC mall located along Alabang, Zapote, Las Pinas City Augu gust 6: Puregold Price Club, through wholly-owned subsidiary Entenso Equities and Goldtempo Company, Inc., acquired eight (8) supermarket stores

• perating

under trade name Budgetlane Augu gust 12 12: Cosco Capital, Inc. through its wholly-owned subsidiary, Ellimac Prime Holdings, Inc., acquired Maunlad mall situated at Malolos Bulacan January 29 29: Approval of merger of Nation Realty, Inc., Go Fay & Co, Inc., SVF Corporation and 999 Shopping Mall, Inc. (Nation Realty,

• Inc. as the absorbing entity).

February 28 28: Acquisition of NE Pacific Shopping Centers Corporation May 1: Acquisition

• f

Office Warehouse, Inc. July 17 17: Acquisition and subscription

• f additional shares of Canaria

Holdings Corporation. July 21 21: Acquisition

• f

Liquigaz Philippine Corporation through Canaria Holdings Corporation

7

9M 9M2016 Co Consolidated Fina inancial Results

9M 9M2016 Con Consoli lidated Fin Financial l Highl ighlights

(In PHP millions)

9

+11.5%

48,976 98,787 116,752 81,455 90,841

Revenues

9,534 17,287 19,964 13,535 15,187

Gr Gros

• ss Prof
• fit

it

5,733 10,179 11,675 8,231 8,769

EB EBITDA

3,731 6,236 6,987 4,622 5,053

Ne Net t Inc ncom

• me

+12.2% +6.5% +9.3%

Revenue Con Contributio ion

10 10

PH PHP P 90. 90.84 billion Con Consolidated Revenues PH PHP8 P81.45 billion 9M2 9M2016 9M2 9M2015

Grocery retail 87% Real estate 1% Liquor 3% Specialty retail 9% Grocery retail 83% Real estate 1% Liquor 4% Specialty retail 12%

Ne Net t Inc ncome Co Contri ribution

*attributable to equity holders of the parent company

PHP PHP 3. 3.01 01 billion PHP3 PHP3.24 billion

11 11

9M2 9M2016 9M2 9M2015

57% Grocery retailing 24% Real estate

12% Liquor distribution

10% Specialty retail

• 3%

Oil and Gas 54% Grocery retailing 24% Real estate 13% Liquor distribution 14% Specialty retail

• 5%

Oil and Gas

9M 9M2016 Con Consoli lidated Bal Balance She heet

12 12

(In PHP millions) 2016 2016 2015 2015 Incr ncrease (Decrease) % Cash and cash equivalents 5,359 14,541

• 9,182
• 63%

Total Current Assets 28,739 24,958 3,781 15% Total Non Current Assets 62,818 58,117 4,701 8% TOTAL ASS SSET ETS 96,915 97,617

• 702

702

• 1%

1% Total Current Liabilities 14,411 19,041

• 4,630
• 24%

Total Non-current Liabilities 11,984 13,032

• 1,048
• 8%

TOTAL LIABIL BILIT ITIE IES 26,394 32,073

• 5,679
• 18%

TOTAL EQ EQUIT ITY Y 70,521 65,544 4,977 8% 8%

Co Core Bu Businesses

7,871 14,760 16,489 11,243 12,9 ,904 17.1% 17.4% 17.0% 16.7% 16.4%

• 2,000

FY2013 FY2014 FY2015 9M2015 9M2016

Gross Profit

Gross Profit Gross Profit Margin

2,548 4,520 5,002 3,203 3,645 5.5% 5.3% 5.1% 4.8% 4.6%

2.0% 4.0% 6.0% 8.0% 10.0% 12.0% 14.0%

• 1,000

2,000 3,000 4,000 5,000 6,000

FY2013 FY2014 FY2015 9M20159M2016

Net Income

Net Income Net Income Margin

Gr Grocery ry Retail iling: 9M 9M2016 Fina Financial Hig ighli lights

• 16.9% growth in Consolidated

Net Sales to PHP 78.7 billion, with Puregold contributing 82.1% of total.

• Growth in Revenues driven by

Puregold’s Same Store Sales Growth (“SSSG”) of 6.6% due to positive growth in basket size of 6.5% and traffic count of 0.2%

• Consolidated Net Profit Margin
• f 4.6%.

Puregold only net margin is 3.7% while S&R net margin is 8.7%.

Key Hi High ghli lights 14 14

(In PHP millions)

+16.9% +14.8% +13.3% +13.8%

46,024 84,697 97,172 67,334 78,7 ,737

FY2013 FY2014 FY2015 9M2015 9M2016

Revenues

4,012 8,133 8,847 5,830 6,603 8.7% 9.6% 9.1% 8.7% 8.4%

3.0% 5.0% 7.0% 9.0% 11.0% 13.0% 15.0% 17.0% 19.0%

• 00

00 00 00 00 FY2013 FY2014 FY2015 9M2015 9M2016

EBIT BITDA

EBITDA EBITDA Margin

Gr Grocery ry Retail iling: Rece ecent De Develo lopments

15 15

• Puregold opened 17 new stores out of targeted 25 new stores

and closed 4 stores

• S&R opened 1 S&R Warehouse and 5 S&R New York Style

Pizza (QSR)

• As of 9M2016, the Grocery Retailing segment is operating a

total of 300 stores with consolidated NSA of more than 442,200 square meters1.

1excludes NE Bodega and Budgetlane stores with a total of 17 stores and 33,000 sqm NSA

PUR UREGO GOLD S&R S&R QSR Metro Manila 107 5 12 Luzon 144 3 7 Visayas 9 1 1 Mindanao 8 2 1 Total 268 268 11 11 21 21

Liqu Liquor Dis Distri ributio ion: Products

16 16

Tequila Jose Cuervo Whisk skey Bushmills Chivas Regal Co Cognac Martel Vodka Absolut Liqueurs Jagermeister Specialty Be Beverages Red Bull Various s Wines Br Brandy Fundador Fundador Light Whisk skey Jim Beam Glenfiddich Br Brandy Alfonso Alfonso Light Excelente Tequila Patron Whisk skey Johnnie Walker Jack Daniels Various s Wines

594 603 660 382 380 16.7% 12.5% 11.6% 11.3% 10.2%

8.0% 13.0% 18.0% 23.0% 28.0%

• 100

200 300 400 500 600 700

FY2013 FY2014 FY2015 YTD2015 YTD2016

Net Net Inc ncom

• me

Net Income Net Income Margin

1,003 1,188 1,299 770 814 28.1% 24.5% 22.9% 22.8% 22.0%

15.0% 20.0% 25.0% 30.0%

• 200

400 600 800 1,000 1,200 1,400

FY2013 FY2014 FY2015 YTD2015YTD2016

Gros

• ss Prof
• fit

it

Gross Profit Gross Profit Margin

Liqu Liquor Dis Distri ributio ion: 9M 9M2016 Fin Financial l Hig ighli lights

• 9.8% increase in revenues due to

the 16% increase in volume of cases sold

• Decline in GP Margin due to

higher cost of sales and sales mix for lower margin segments

• Net income remained flat due to

the net effect of decrease in GP Margins and increase in

• perating expenses

Key Highlights

17 17

(In PHP millions)

+9.8% +0.2% +5.7%

3,565 4,841 5,677 3,377 3,707

FY2013 FY2014 FY2015 YTD2015 YTD2016

Reven enues

731 838 919 523 524 20.5% 17.3% 16.2% 15.5% 14.1%

FY2013 FY2014 FY2015 YTD2015 YTD2016

EB EBITD TDA

EBITDA EBITDA Margin

• 0.7%

Liqu Liquor Dis Distri ributio ion: Tot

• tal

l Volu

• lume Sale

ales

18 18

• 16% growth in total volume of cases sold
• Growth mainly driven by Alfonso Light and Alfonso Solera

(in no of cases) 9M2015 9M2016 Incr crease se % Growth Brandy 587,862 706,050 118,188 20% Other spirits 201,437 216,341 14,904 7% Wines 101,263 111,042 9,779 10% Specialty Beverages 82,297 93,480 11,183 14% Total 972,859 1,126,913 154,054 16% 16%

Liqu Liquigaz: 9M 9M2016 Fin Financial l Hig ighli lights

19 19

• 26%
• 19.6%
• 27%

(In PHP millions)

• Decline in revenues due to low

global LPG price and 6% decline in total volume sold for the 9- month period

• New terminal facility in Sairaya,

Quezon to be completed in 2H2017

• Operating 2 LPG showrooms and

signed 5 new sites 2014 2014 2015 2015 9M2 M2015 9M2 M2016 Volume Sold (In metric tons) 432,995 423,151 323,137 303,683

• 21.8%

1,014 932 826 646 5.3% 7.9% 9.0% 9.6%

3.0% 5.0% 7.0% 9.0% 11.0% 13.0% 15.0% 17.0% 19.0%

• 200

400 600 800 1,000 1,200

FY2013 FY2014 FY2015 9M2015

Gros

• ss Prof
• fit

it

Gross Profit Gross Profit Margin

734 733 698 561 3.9% 6.2% 7.6% 8.3%

2.0% 4.0% 6.0% 8.0% 10.0% 12.0% 14.0%

• 100

200 300 400 500 600 700 800

FY2013 FY2014 FY2015 9M2015

EB EBITD TDA

EBITDA EBITDA Margin

279 399 421 307 1.5% 3.4% 4.6% 4.6%

0.0% 2.0% 4.0% 6.0% 8.0% 10.0%

• 50

100 150 200 250 300 350 400 450

FY2013 FY2014 FY2015 9M2015

Net Net Inc ncom

• me

Net Income Net Income Margin

Key Highlights

18,956 11,854 9,149 6,739

FY2014 FY2015 9M2015 9M2016

Revenues

118 268 354 258 302

18.0% 25.7% 27.2% 26.5% 26.1%

15.0% 17.0% 19.0% 21.0% 23.0% 25.0% 27.0% 29.0%

• 50

100 150 200 250 300 350 400

FY2013 FY2014 FY2015 YTD2015 YTD2016

Gros

• ss Prof
• fit

it

Gross Profit Gross Profit Margin

Office fice War arehouse, , Inc. nc.: 9M 9M2016 Fin Financial l Hig ighli lights

• Opened 5 new stores out of

targeted 10 new organic stores for the year

• Sales grew by 19% versus last

year, with SSSG of 9.69%.

• Positive results is due to store

network expansion, enhanced product

• fferings,

and active sales and marketing campaigns.

• Decline in Gross Profit Margin

due to product mix and promotional discounts

Key Highlights

20 20

+19% +17% +24%

(In PHP millions)

655 1,043 1,302 974 1,156

FY2013 FY2014 FY2015 9M2015 9M2016

Revenues

39 46 97 76 97 97

5.9% 4.4% 7.5% 7.8% 8.4%

2.0% 4.0% 6.0% 8.0% 10.0% 12.0% 14.0%

FY2013 FY2014 FY2015 YTD2015 YTD2016

EB EBITD TDA

EBITDA EBITDA Margin

+24.8%

2014 2014 2015 2015 9M2 M2016 # of Stores 48 59 64 Net Selling Area 11,036 sqm 12,638 sqm 20 23 54 44 55 55 3.1% 2.2% 4.1% 4.5% 4.7%

• 10

20 30 40 50 60 70

FY2013 FY2014 FY2015 9M2015 9M2016

Net Net Inc ncom

• me

Net Income Net Income Margin

Com Commercial l Real eal Estate: 9M 9M2016 Fin Financial l Hig ighli lights

• 1.1%

increase in Revenues attributable acquisition

• f

6 community malls last year and higher income from its

• il

storage facility

• 8.5% increase in Net Income

due to stable rental income and effective management

• f
• perating expenses
• On-going

construction

• f

community malls located in Binan, Laguna and Marikina with target date of opening by 1H2017

Key Highlights

21 21

(In PHP millions)

+1.1% +2.7% +2.5%

FINANCIAL RATIOS 2016 Rental Yield, gross 11.90% Rental Yield, net 4.92% Leverage 0.59 ROE 5.4%

+8.5%

1,838 2,210 2,423 1,721 1,739

FY2013 FY2014 FY2015 9M2015 9M2015

Revenues

980 1,275 1,464 1,022 1,049

53% 58% 60% 59% 60%

• 200

FY2013 FY2014 FY2015 9M2015 9M2016

Gros

• ss Prof
• fit

it

Gross Profit Gross Profit Margin

771 1,346 1,504 1,105 1,133

42% 61% 62% 64% 65%

30% 35% 40% 45% 50% 55% 60% 65% 70% 75% 80% 85% 90%

• 00

00 00 00 00 00 00 00

FY2013 FY2014 FY2015 9M2015 9M2016

EB EBITD TDA

EBITDA EBITDA Margin

563 959 1,028 715 776

31% 43% 42% 42% 45%

• 200

FY2013 FY2014 FY2015 9M2015 9M2016

Net Net Inc ncom

• me

Net Income Net Income Margin

Com Commercial l Real eal Estate: Propert rty Port

• rtfolio

io

Metro Manila

• 13 Commercial Buildings
• 5 Land under lease

Key statistics

Luzon

• 16 Commercial Buildings
• 3 Land under lease
• Nueva

Ecija, Batangas, Zambales, Isabela, Aurora, Quezon, Rizal, Cavite, Bulacan, Pampanga, Pangasinan

Visayas

• 1 Land under lease
• Cebu City

Area with commercial property

Geographic coverage

22 22

Cate tegory ry 3Q2016 GL GLA/Lot t Are rea a in in sq.m .m. Investm tment cost st in PHP million Land under lease 9 146,148 4,243.50 Commercial Buildings 29 259,215 12,973.30 Total 38 405,363 17,216.80 * Ave. Occupancy Rate 92%

Key y Init nitiatives for

• r FY2

FY2016

Groc

• cery

Retaili iling Spe pecia ialty lty Retaili iling Li Liqu quor

• r

Distr tribu ibutio ion Com

• mmercia

ial l Real al Es Estate

• Continue to expand into new geographic locations
• Puregold to increase store network by 25 stores
• S&R to expand by 2 new warehouse club outlets
• Liquigaz to invest in additional infrastructure and pursue downstream

market expansion strategy

• Office Warehouse store expansion by 10 stores per year in the mid-term,

and strengthen customer base through loyalty program and online marketing

• Maintain market leadership in the premium wine and liquor segment
• Continue to introduce new product lines
• Development of 3 community malls
• Refurbishment and renovation of newly acquired properties to increase

tenancy

Man anag agement t remains ins foc

• cus

used d on n core tar target t ma markets ts for

• r each of

f its br bran ands ds, and nd

• n

n the he sus ustai ainab able le and nd long-term gr grow

• wth

h of the he Com

• mpan

any 23 23

Thank you.

www.coscocapital.com