Institutional Presentation IIIQ FY 2019 1 IRSA: Leading Real - - PowerPoint PPT Presentation

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Institutional Presentation IIIQ FY 2019 1 IRSA: Leading Real Estate Company in Argentina Leading real estate company in Argentina with opportunistic assets abroad. 62.4% Majority shareholder of IRSA Propiedades Comerciales,

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Institutional Presentation

IIIQ FY 2019

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29.9% 82.3% VP 18.9% Dolphin 49.0%

HOTELS SANTA MARÍA & OTHER LANDBANK INTERNATIONAL SHOPPING MALLS OFFICE BUILDINGS COMMERCIAL LANDBANK

100.0% 82.3% 62.4%

IRSA: Leading Real Estate Company in Argentina

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▪ Leading real estate company in Argentina with opportunistic assets abroad. ▪ Majority shareholder

  • f

IRSA Propiedades Comerciales, leading commercial real estate company in Argentina with ~447,000 sqm of GLA located in premium locations.

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IRCP at a glance

▪

Best-in-Class Operator

Shopping Malls

95% occupancy 75% EBITDA Mg

▪

High brand recognition & customer loyalty Valuable customers information & technology innovation

110 mn

Annual Mall visitors

2.5x

Argentina’s population

15 Shopping Malls 332k sqm GLA 67% Market Share BA City 8 Office Buildings 115k sqm GLA 11% Market Share A+

BA City

▪ Unique Portfolio of Prime Commercial Real Estate

Offices

91% occupancy 80% EBITDA Mg

BEST Real Estate Company

Top of mind

Shopping Malls

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  • Leading commercial real estate company in Argentina
  • Listed on Nasdaq & ByMA
  • Controlled 82.3% by IRSA Inversiones y Representaciones
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Premium Portfolio of Shopping Malls

High income Area Mid Income Area Low Income Area

USD 102 MN LTM EBITDA USD 1.1 BNBook Value mar’19

(USD 2.0 BN dec’17)

BA City Argentina

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Premium Portfolio of Office Buildings

Expanding Corporate North Area Business Center AAA Location Back Office Center

USD 18 MM LTM EBITDA USD 0.3 BNBook Value

BA City

200 Della Paolera (FY 2020)

  • Est. EBITDA

~USD 10-12 MM Zetta Building (2H FY2019)

  • Est. EBITDA

~USD 9MM

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Offices – Leases USD/sqm/month & Occupancy Same Shopping Malls’ Sales

(% Var i.a.)

Shopping Malls & Offices

Operating Figures

25,8 26,5 26,3 98% 91% 91%

IIIQ17 IIIQ18 IIIQ19

337,401 340,111 332,119

98% 99% 95% IIIQ17 IIIQ18 IIIQ19

Offices – Stock (sqm GLA) Shopping Malls – Sqm GLA (Th.) & Occupancy (%)

Mainly due to 12,600 sqm vacancy generated by Walmart in DOT Baires Shopping end of concession Excluding this effect, IIIQ 19

  • ccupancy would have been

98.3%

+ 9.2%

  • 1.4%

+74.5%

Zetta Building 200 Della Paolera

77,252 84,361 83,205 83,205 115,205 32,000 30,000 115,208 145,205 IIIQ17 IIIQ18 IIIQ19 FY19E FY20E

Excluding IIIQ19 Nominal Terms: 31.2% Real Terms: -13.6%

21,2% 18,3% 19,5% 18,3% 22,3% 22,7% 27,3% 28,7% 24,4% 24,7% 29,6%

  • 14,5% -14,1%
  • 2,9%
  • 2,1%

2,8%

  • 0,1%

1,6% 1,2%

  • 8,1%
  • 15,5% -14,7%

IQ 17 IIQ 17 IIIQ 17 IVQ 17 IQ 18 IIQ 18 IIIQ 18 IVQ 18 IQ 19 IIQ 19 IIIQ 19 Nominal terms Real terms

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Our land reserve will allow us to significantly expand our commercial real estate portfolio

We have a robust pipeline for shopping malls… …as well as for premium office properties

115 115 115

1062 106

221

Current New developments Current GLA & pipeline

1.9x

332 332 128 130 128 1181 118

580

Current Brownfield Greenfield Current GLA & pipeline

1.7x

~19,000 sqm currently under construction or to start soon ~35,000 sqm currently under construction

In existing land reserve In existing land reserve

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“200 Della Paolera” Office building (under development in Catalinas)

87% 13%

Current Ownership

35,000 GLA sqm

Total Project

FY 2020 Est. opening USD 10-12mm

  • Est. EBITDA

51.6% Work Progress*

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*As of March 31, 2019

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32,000 GLA sqm ~ USD 9mm

  • Est. EBITDA

USD 60 mm

  • Est. investment

Fully Leased

9 80 % 20%

Zetta building Opening

May 6, 2019 The first building of the Office Park developed in the north area of BA City

15% Cap Rate

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Polo Dot Full Project

Existing Shopping Mall Zetta Building Polo Dot 1st stage Polo Dot 2nd stage Polo Dot 3rd stage Philips Building Future Recycling Existing Office Building Future Mall Expansion

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Shopping malls´ Expansions Alto Palermo City of Buenos Aires

Highest sales/sqm shopping mall

US$28.5mm

estimated investment

FY2020

  • pening date

3,900

sqm GLA

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10.5% Work Progress*

*As of March 31, 2019

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Recent Approval: La Plata Mixed-use Project Land Plot

78,000 sqm

Capacity to develop

100,000 sqm

La Plata BA City

La Plata is the 5th highly populated city of Argentina with no shopping malls

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Recent Approval: Caballito Project Land Plot of 23,000 sqm Capacity to develop

Residential: ~ 76,000 sqm Retail: ~ 11,000 sqm

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Libertador

BA city

Intercontinental

BA city

Llao Llao Resort

Bariloche city

Argentina Business Center - Hotels

194 198 203

69,6% 71,9% 69,3%

IIIQ17 IIIQ18 IIIQ19

Rate USD/room & Occupancy evolution 69 483

9M18 9M19

EBITDA (ARS MM)

+ 600%

On Feb-19, IRSA acquired 20% of the shares of Hoteles Argentinos S.A., owner of the hotel formerly known as Sheraton Liberatdor

Current stake: 100%

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San Luis Neuquén Montevideo (Uruguay) Paraná Tucumán Pereiraola Caballito Pilar Pontevedra Mariano Acosta Merlo La Adela Puerto Retiro UOM Lujan La Plata Coto Abasto (air surface) San Martín Land Plot Maltería Hudson

Argentina BA Province

USD 460 MN

Book Value

Santa María del Plata

City of BA

~20 mn sqm

Land Surface

~ ~ 70

700,000 sq sq of

  • f Premium Re

Real Esta Estate to

  • be

be de developed in n the he be best loca

  • cations in

n BA A City (App Approvals pe pend nding)

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Premium mixed-use Landbank for future developments

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7 7,6 17,65 12.85

31/3/2017 30/9/2017 31/3/2018 30/9/2018 31/3/2019

Argentina Business Center – Banco Hipotecario

IRSA 29.9%

Ownership

Market Value to IRSA

(USD million)

Share Price evolution

Results to IRSA ▪ The bank has generated a loss of ARS 533 million during 9M19 compared to a gain of ARS 348 million during 9M 18.

  • 27%

IIIQ 19 vs. IIIQ 18

2019 main work fronts:

  • Liabilities: to preserve cash and long term

deposits, adjusting rates to market changes.

  • Assets: increase of commissions, fees and

preservation of the quality of the portfolio in a context of higher delinquency rates.

  • Balance Sheet equilibrium: preserving the

solvency and liquidity, with focus on the funding.

179 393 133 134

IIIQ17 IIIQ18 IIIQ19 Current as of May,7

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Argentina Business Center - International

Leases (USD MM) & Occupancy NOI (USD MM) 26 26 27

FY16 FY17 FY18

Market Value to IRSA

(USD million)

IRSA 18.9% FLOAT 56.8%

STEPSTONE 24.3%

Ownership

Edificio Lipstick

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58,0 58,000 sqm sqm of

  • f GLA

GLA in 34 34 fl floors

69 78 77

95% 97% 96% FY17 FY18 IIIQ19

*3,3mm en preferidas E + 0,7 promissory note

22,6 20,3 21,9 4 25,9

IIIQ 18 IIIQ 19 Current as of May 9, 2019

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Investment in IDB & DIC – Israel

Current Corporate Structure (as of mar-19)

100% 82.3% Indirectly*

68.8% 100% 20.3%** 19.3% 44.1% 68.8% 59.5% 26.0% 45.4% 51.7%

* There is a non recourse intercompany loan between Dolphin (borrower) and IDB (lender) due to the transference of DIC shares. This loan is guaranteed with DIC shares sold. ** 15% of the shares are held by a trustee. IDB sold 24% of Clal shares as part of swap transactions. Energy Tourism Insurance Financial Investments Telecommunications Agriculture Rental Properties Real Estate Technology Supermarket Working to reduce one more layer of public companies before December 2019, according to Concentration Law requirement

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4.947 3.452

1.000 2.000 3.000 4.000 5.000 6.000 7.000

Equity Market cap

Market Cap vs. Book Value

(NIS million)

70% BV

Clal Insurance

(20.3% IDB current stake + 24.0% through swaps)

Recent Material events

✓ Control permit requested on Mar-19 – under process ✓ Sale agreements signed with third non-related parties ▪~ 10% already sold (5% of the shares held by the trustee and 5% of the Swaps transactions) to 2 private investors, at NIS 47.7. ▪In the event of gaining control permit, one of the investors received an option to buy another 3% at NIS 50. ▪An additional option was given for a third investor (3-5% at NIS 47.7), financed by 90% seller loan. ✓ After the sale, IDB total exposure reduced to 45.3% (20.3% directly and 24% through SWAPS)

✓ Positive market reaction to the sale: total 20% increase 3 days following the sale ✓ Current Market Cap / Equity: 70%

USD 967 MM Mkt Cap

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PBC (67.5% DIC Stake) & Gav Yam (51.7% PBC Stake) Leading real estate companies in Israel

Office & hi-tech park Commercial & Retail Industrial & Logistics Properties under construction Residential Land reserves

HSBC Building - Manhattan Matam Park - Haifa Herzeliva North Tivoli - Las Vegas

1,160,000 sqm qm

in n Isr srael

97 97%

Occupancy

670,000 sqm qm

Lan Land d Ban ank

142,000 sqm qm

in in USA SA

Mar Market Cap Cap

USD 54 542 2 MM USD 1, 1,047MM 20

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Real Estate projects under development in Israel

The New Haifa Bay – Logistic Center

Opening during 2H FY 2019

TOHA: 95% already leased. Opening during 2H FY 2019 NEGEV: 3 of 4 buildings finished MATAM-YAM: Recently finished

Amazon main tenant

8 Projects 194,000 sqm

REHOVOT: 3 of 4 buildings finished

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Shufersal (26.0% DIC stake): Israel’s Leading Food Retailer

✓Traded on TASE – Market cap USD 1,589 MM ✓Operates 338 stores nationwide

  • Shufersal: 274 stores
  • New Pharm: 64 stores

✓Holds a real estate portfolio of ~ NIS 3 billion

Private Label - % of Total Sales

22,1% 21,6% 22,1% 22,2% 24,0% 24,0%

Q1 2017 Q2 2017 Q3 2017 Q4 2017 Q2 2018 Q3 2018

Online Sales - % of Total Sales

11,8% 10,5% 11,2% 12,4% 13,5% 13,6%

Q1 2017 Q2 2017 Q3 2017 Q4 2017 Q2 2018 Q3 2018

New Pharm recent acquisition 2nd largest pharmacy chain in Israel

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Largest Telecommunications Provider

(43.9% DIC stake)

20 37 50 63 74 87 99 111 124 137 154 170 184 195 206

Q1 2015 Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q2 2016 Q3 2016 Q4 2016 Q1 2017 Q2 2017 Q3 2017 Q4 2017 Q1 2018 Q2 2018 Q3 2018

Cellcom TV Subscribers (Th.)

✓ Fastest growing company in TV, internet &

fixed line services:

  • ISP Service for 685k households
  • Over 195,000 pay TV subscribers

✓Israel’s largest cellular provider – 2.8 million subscribers

26% market share

✓Competition:

  • Operates in competitive environment -5 cellular providers.
  • Cellular: ARPU NIS 51.8 vs ~ NIS 163 in the US.

✓Transition from cellular company to communication Group: ✓ Market cap USD 524 MM

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Deleverage at IDB & DIC

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Net Debt (USD million)

Stand alone Stand alone

1290 1312 923 781 749 711 613

dec-2012 dec-2013 dec-2014 dec-2015 dec-2016 dec-2017 dec-2018

1321 1466 951 954 740 966 632

dec-2012 dec-2013 dec-2014 dec-2015 dec-2016 dec-2017 dec-2018

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Net Debt as of March 31, 2019*

(USD millions)

Amortization Schedule

IRSA Net Debt 313.2

*Does not include IRCP & IDB/DIC debt

17.0 204.1 83.2 8.8

FY 2019 FY 2020 FY 2021 FY 2022

Subsequent events:

▪ Credit line with IRCP for up to USD 180 mm, for up to 3 years, at an interest rate equal to IRSA 2020 or future issuances. ▪ In May 2019, we issued a local Bond for USD 96.3 mm at a fixed annual interest rate of 10.0% due November 2020 to refinance short-term debt

96.3

Recently issued

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Investment Highlights

ROMPECABEZAS BR PROPERTIES

Leading Real Estate Company Strong Capital

Markets track

record 25 years

Listed in NYSE

2.1 mm sqm

worldwide High standards of

Corporate Governance Diversified country risk

Argentina Israel USA

Unique

Portfolio of

Real Assets

across the world

Financial Solvency

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