1Q2018 INSTITUTIONAL PRESENTATION

Transcription

1 1 ST QUARTER 2018 SHOPPING ESTAÇÃO - PR 0

2 INDEX 1. OVERVIEW 2. WHY INVEST IN BRMALLS? 3. PORTFOLIO MANAGEMENT 4. ACHIEVEMENTS 5. FINANCIAL HIGHLIGHTS 6. APPENDIX

3 1. OVERVIEW SHOPPING PLAZA NITERÓI- RJ 2

4 BRMALLS OVERVIEW Company Highlights PLAZA NITERÓI - RJ LARGEST mall company in Latin America Nationwide presence covering all 5 regions of Brazil SHOPPING TIJUCA - RJ ACTIVE PORTFOLIO MANAGEMENT: 39 acquisitions 10 greenfields 21 expansions 20 asset sales NORTESHOPPING - RJ Portfolio with 39 regional malls, 7% of the total malls in Brazil 3

5 OVERVIEW High Quality Portfolio: with large presence and regional scale 5 MG / Midwest 19% 11% North / Northeast 9 % of total NOI 26% São Paulo % RJ / ES 13% South 6 Midwest/ RJ / ES São Paulo South region MG region Northeast/ North region Plaza Niterói Shopping Villa-Lobos Center Shopping Uberlândia Shopping Curitiba Amazonas Shopping 4

6 OVERVIEW Highly Diversified Client Base BRANDS (% OF BASE RENT) SEGMENTS (% SATELITE STORE GLA¹) Brand 1 2.1% 11.0% Restaurants 10.6% General Apparel Brand 2 1.8% 6.8% Shoes Brand 3 1.6% 5.7% Women s Apparel 5.5% Fast-Food Brand 4 1.4% 3.5% Cosmetics Brand 5 1.2% 2.4% Men s Apparel Updated on March 18 th, 2018 ¹Most representative segments, excluding department stores, supermarkets and cinemas. 5

7 OVERVIEW Largest company in the sector in less than 10 years... NET REVENUE (R$ MILLION): 27.8% a.a. ou 15x NOI: 28.8% per year or 16x Adjusted EBITDA: 28.0% per year or 15x Total GLA Growth: 579% or 7x 1,124 1,304 1,395 1,447 1,370 1, shoppings Total Aquisitions Greenfields Expansions Divestments # Malls Total GLA (thousand m²) ,033 1,197 1,434 1,621 1,689 1,691 1,638 1,646 1,446 1, (*) Considering asset sales and acquisitions only of the malls in which the company divested its entire interest or added one more shopping center to the portfolio. Does not consider the 44 increases in stake and 4 partial divestments. 6

8 OVERVIEW...in a Strong and Resilient Sector SALES PERFORMANCE IN MALL (R$ BILLIONS) Average Inflation ( ): +6.5% p.a. Average GDP Growth( ): +2.3% p.a. Sales CAGR ( ): +13.7% p.a Mexican Crisis (1994) & Asian Crisis (1997) Russian Crisis (1998) & Real Depreciation (1999) 2002 Crisis Lula Election Subprime Crisis ( ) European Crisis ( ) Car Wash Crisis ( ) Avg. GDP Growth (95-97): 2.9% Avg. GDP Growth (98-00): 1.8% Avg. GDP Growth (03-05): 3.0% Avg. GDP Growth (08-09): 3.2% Avg. GDP Growth (11-12): 2.5% Avg. GDP Growth (14-17): -1.5% Avg. Inflation (95-97): 7.4% Avg. Inflation (98-00): 5.5% Avg. Inflation (03-05): 7.5% Avg. Inflation (08-09): 5.1% Avg. Inflation (11-12): 5.8% Avg. Inflation (14-17): 6.6% Avg. Interest Rate (95-97): 35.4% Avg. Interest Rate (98-00): 21.3% Avg. Interest Rate (03-05): 17.4% Avg. Interest Rate (08-09):11.2% Avg. Interest Rate (11-12): 9.1% Avg. Interest Rate (14-17): 11.6% Sales Growth CAGR (95-97): 18.3% Sales Growth CAGR (98-00): 19.9% Sales Growth CAGR (03-05): 12.4% Sales Growth (08-09): 14.6% Sales Growth (11-12): 10.6% Sales Growth (14-17): 5.6% Source: IPEA Data and ABRASCE 7

9 2. WHY INVEST IN BRMALLS? SHOPPING CURITIBA - PR 8

10 WHY INVEST IN BRMALLS? BRMALLS is the best and largest company in the sector 1 o SIZE 1 o GROWTH 1 o PROFITABILITY CURRENT TOTAL GLA (THOUSAND m²) OWNED GLA CAGR ( ) EBITDA MARGIN AVG # Malls , % 5.4% 12.9% 77.6 % 70.3% 74.0% TOTAL SALES 2017 (R$ MILLION) NET REVENUES CAGR ( ) NOI MARGIN AVG ,246 14,657 13, % 15.0% 18.4% 90.7% 86.5% 87.1% EBITDA 2017 (R$ MILLION) ADJUSTED EBITDA CAGR ( ) G&A/GROSS REVENUES AVG % 17.2% 20.6% 7.1% 14.9% 10.0% 9

11 WHY INVEST IN BRMALLS? Solid Portfolio Management Track-Record: Acquisitions 39 ACQUISITIONS TURNAROUND EXPERTISE RENT PARKING - Higher occupancy rate - Leasing spreads - Improvements in auditing - Expertise in pricing strategy - Higher operational efficiency MALL & MEDIA - Media: bargaining power - Mall: higher occupancy rate TENANT MIX - Largest tenant base - Access to the best brands IMPROVENTS IN CONSUMER EXPERIENCE - Redevelopments - Marketing expertise 2011 # OF ACQUISITIONS SINCE 2007 ( NEW ASSETS )

12 WHY INVEST IN BRMALLS? Solid Portfolio Management Track-Record: Divestments 20 ASSET SALES² SALES CAP RATE¹ 9.9% 10.3% 9.7% # OF DIVESTITURES² SINCE Source: BRMALLS and Companies ¹ Average Sales Cap Rate in each period, considering LTM NOI ² Considers full and partial divestments 11

13 WHY INVEST IN BRMALLS? Solid Portfolio Management Track-Record: Developments 21 EXPANSIONS 10 GREENFIELDS INDEPENDÊNCIA SHOPPING - MG SHOPPING SETE LAGOAS - MG GRANJA VIANNA - SP 2011 MOOCA PLAZA SHOPPING - SP SHOPPING VIA BRASIL - RJ 2012 SHOPPING ESTAÇÃO BH - MG LONDRINA NORTE SHOPPING - PR SÃO BERNARDO PLAZA SHOPPING - SP SHOPPING CONTAGEM - MG SHOPPING VILA VELHA - ES Since 2007, the LARGEST mall developer in Brazil

14 WHY INVEST IN BRMALLS? Capital Structure UNENCUMBERED ASSETS (% INVESTMENT PROPERTIES) 1Q18 DEBT PROFILE 3.7% 0.1% Cash Position R$ 1,6 bi 38% 62% 20.4% 18.1% Exposure to each Index 57.7% Average Remuneration (% CDI) Gross Debt 100,5% Average Cost 9,0% R$ 3,0 bi TR CDI IPCA IGP-M Fixed Net Debt R$ 1,4 bi Unencumbered Assets Encumbered Assets LTM ADJUSTED EBITDA/ FINANCIAL NET DEBT NET DEBT/ 1Q18 LTM ADJUSTED EBITDA 3,9 4,2x 3,9x 2,2 3,1 1,9 2,1 1,6x 2,3x 2,8x 1T14 1T15 1T16 1T17 1T18 1T17 1T18 13

15 WHY INVEST IN BRMALLS? Corporate Governance EXECUTIVE OFFICERS BOARD OF DIRECTORS OFFICERS TITLE YEARS IN BRMALLS Ruy Kameyama CEO 11 Frederico Villa CFO and IR Director 10 José Vicente Avellar COO 8 Mariane Grenchinski CDO 11 Claudia Lacerda General Counsel 11 Bianca Bastos HR Director 7 DIRECTORS Cláudio Bruni Bruno Rudge João Roberto Teixeira José Afonso Castanheira Luiz Alberto Quinta Luiz Antonio de Sampaio Campos Mauro Rodrigues da Cunha TITLE Chairman Independent Director Independent Director Independent Director Director Independent Director Independent Director Alignment with investors: AFFO/share as key long term goal ISS QUALITYSCORE BENCHMARK¹ (1 = LOWEST RISK) Governance Committees: Audit People Compensation Risk 1 2 Full Corporation, listaded under NOVO MERCADO Key employees aligned with Company via Performance Share Program No shareholder agreement ¹Updated in December,

16 WHY INVEST IN BRMALLS? Capital Markets & Valuation AVERAGE DAILY TRADED VOLUME¹ UPSIDE TO CURRENT PRICE² Historical High R$ ,2% 52 NAV R$ ,9% 2019 PRICE/FFO ³ 17.5x Consensus* R$ ,9% 15.9x 15.2x Last Price R$ ¹YTD average until March 21 st, 2018 ²Updated on March 21 st, 2018 ³Bloomberg estimates *Bloomberg consensus, updated March 22 nd, 2018 NAV = fair value of investment properties of current malls net debt minority interest / number of outstanding shares 15

17 WHY INVEST IN BRMALLS? Capital Markets & Valuation 2018E EV/EBITDA VS. INTERNATIONAL PEERS 10.9x 14.3x 12.2x 9.9x 18.8x 13.4x 12.0x 15.6x 18.3x 17.0x 17.1x 14.7x 25.0x 20.7x 22.2x 14.2x 23.0x 23.2x Brazil Latin America United States Others Average 11.8x 15.0x 16.8x 21.3x BRMALLS vs. Average -0.9 p.a p.a p.a p.a. Updated on March 21 st, 2018 Source for international peers: Bloomberg Source for national peers: sell-side analyst estimates 16

18 3. PORTFOLIO MANAGEMENT 17 SHOPPING TIJUCA- RJ

19 PORTFOLIO MANAGEMENT 86% of our NOI exposed to Tier 1 & 2 assets NOI REPRESENTATIVENESS PER ASSET OPERATIONAL INDICATORS PORTFOLIO 1 Tier 1 & Top 15 75% of Total NOI Top 20 85% of Total NOI R$ 143 NOI/m² R$ 121 Rent/m² R$ 1,418 Sales/m² R$ 132 NOI/m² R$ 111 Rent/m² R$ 1,356 Sales/m² o o o o Dominant malls Regions with high population density High purchase power potential Tenant and consumer top of mind Top 25 91% of Total NOI R$ 123 NOI/m² R$ 103 Rent/m² R$ 1,303 Sales/m² o Tier 3 & 4 Low NOI representativeness Top % of Total NOI R$ 106 NOI/m² R$ 92 Rent/m² R$ 1,200 Sales/m² o o Unmanaged assets Assets in maturity period

20 PORTFOLIO MANAGEMENT Redevelopments During 3Q17, we announced 5 retrofit projects (NorteShopping, Villa Lobos, Tijuca, Plaza Niterói and Center Uberlândia). According to the disclosed timeline, we already began works at Norteshopping and works in the other projects will begin in After further study and development of the scope of the projects, we defined that a total CAPEX of approximately R$400 million will need to be disbursed over the next 5 years throughout 10 of our main assets. This investment will have a major importance towards the strengthening of our assets, assuring their attractiveness in the future. To the right, we display a breakdown by project: NorteShopping: Works began by the end of 2017, with completed phases delivered in 2018 and 2019, and conclusion in Plaza Niterói: Project approval during 2Q18, with completed phases to be delivered in 2018 and 2019 and expected conclusion in Center Uberlândia: Expected approval date in 2Q18, with completed phases to be delivered in 2018 and 2019 and expected conclusion in Tijuca: Project approval during 3Q18, with completed phases to be delivered in 2018, 2019 and 2020 and conclusion in Villa-Lobos: Project approval in 3Q18, with completed phases delivered in 2018, 2019 and 2020 and conclusion in

21 PORTFOLIO MANAGEMENT Developments SHOPPING ESTAÇÃO CUIABÁ PROJECT S CAPEX SCHEDULE (R$ MILHÕES) o o o LARGEST mall in Mato Grosso 47,333 m² of total GLA 75% interes o 78% of constructions completed o Opening date 4Q 2018 Until 4Q17 1Q Apr-Dec 2019 Onwards Total Click here for a virtual tour Click here for aerial shots of the construction site 20

22 PORTFOLIO MANAGEMENT Portfolio Strengthening: Acquisitions EXTERNAL ACQUISITIONS Focus in TIER 1 malls located in main urban areas INTERNAL ACQUISITIONS Efforts towards increasing our interest in our CORE ASSETS Tenant and consumer TOP OF MIND BRMALLS has an average interest of 60% in its current portfolio, with the potential of a 10% increase in STRATEGIC ASSETS. POTENTIAL EXTERNAL ACQUISITIONS SCENARIO POTENTIAL INTERNAL ACQUISITIONS SCENARIO Potential Increase 10% 78 Other Partners 30% BRMALLS 60% Total Number of Malls GLA Under 30 thousand m² Population Under 500 thousand Direct Competitors Potential Acquisitions 21

23 PORTFOLIO MANAGEMENT Portfolio Strengthening: Acquisitions MARKET SHARE OF BRAZILIAN SHOPPING MALLS 88% 80% 74% 74% 72% 71% 72% 71% 73% 84% 84% 84% 12% 20% 26% 26% 28% 29% 28% 29% 27% 16% 16% 16% MARKET SHARE (% OF OWNED GLA 2017) Top 4 Mall Players* 5% 5%3% 3% BRMALLS Multiplan Iguatemi Aliansce Others Brazilian GLA in 2017: 15,580 mil m² 84% * 4 Maiores Empresas: BRMALLS, Multiplan, Iguatemi e Aliansce. Fonte: ABRASCE 22

24 4. ACHIEVEMENTS 23 NORTESHOPPING- RJ

25 ACHIEVEMENTS Capital Structure Follow-On 17 : Companies largest ever capital raising R$ 1,7 bi Mai/17 Renegotiation of TR linked debts: reduction of 30 bps Ago/17 RATING UPGRADE Moody s: Aa1 Fitch: AA+, positive outlook Nov/17 Jul/17 Pre-payment of perpetual bond: R$ 1,2 billion New leverage level: 2,4 x (Net debt/ EBITDA LTM) Out/17 Unsecured CRI 400 R$ 400 milllion 97.5% of CDI Jan/18 Amortization of JPM 4131 debt No longer exposed to US Dollar related debts 24

26 ACHIEVEMENTS Operational Indicators SAME STORE SALES ANNUAL GROWTH (%) SAME STORE SALES QUARTERLY GROWTH (%) 14.1% 7.0% 8.9% 7.4% 4.5% 6.5% 3.0% 2.8% 5.3% 4.6% 1.6% 2.7% -0.6% % 1Q17 2Q17 3Q17 4Q17 1Q18 SAME STORE RENT ANNUAL GROWTH (%) SAME STORE RENT QUARTERLY GROWTH (%) 10.5% 9.3% 13.6% 9.6% 9.8% 7.9% 7.3% 6.5% 7.5% 4.3% 4.4% 4.9% 1.7% 0.4% Q17 2Q17 3Q17 4Q17 1Q18 SHOPPING PLAZA NITERÓI- RJ 25

27 ACHIEVEMENTS Tenant Mix Improvements NET LATE PAYMENTS (%) SALES/m² GROWTH (%) & SSS (%) 7.3% 4.8% 7.2% 5.3% 6.8% 4.6% 4.8% 1.6% 1.7% 1.3% 1.6% 0.4% 2.4% 1.6% 2.7% 1Q17 2Q17 3Q17 4Q17 1Q18 1Q17 2Q17 3Q17 4Q17 1Q18 Sales/m² vs. year -1 Same Store Sales (SSS) SIGNED CONTRACTS OCCUPANCY RATE (%) 1,893 Contracts singed in % 94.7% 95.2% 96.2% 96.5% 1Q 2Q 3Q 4Q 1Q17 2Q17 3Q17 4Q17 1Q

28 ACHIEVEMENTS Comercial Strengthening CHANGES IN TENANT MIX¹ +1.6% +2.5% Restaurants Services +0.2% +0.2% +0.6% Leisure Pet +1.0% +1.3% Children Appliances Sporting Goods Fast Food; -0.3% Mobile Phones/Computer; -0.5% Supermarket; Apparel; -1.1% -1.1% Department Stores; -1.5% *Variations in GLA of each segment between 2014 and

29 ACHIEVEMENTS Stabilized Results 2017 (R$ MM) Stabilized Results (R$ MM) Discounts¹: +21MM Net Revenues R$ 1,348 R$ 1, % Vacancy²: +22MM Adjusted EBITDA R$ 876 R$ 1, % PDA 3 : +149MM Adjusted EBITDA Margin 65.0% 76.8% +1,180 bps AFFO R$ 426 R$ % Financial Result 4 : +52MM AFFO Margin 31.6% 48.1% +1,650 bps Total: R$ +244MM/year Fonte: BRMALLS 1 Discount upside, considering the company s historic level of 1-2% of rent revenues 2 Vacancy upside, based on the average occupancy rate for 2017 vs. stabilized occupancy rate of 97.5% 3 PDA estimated upside based on PDA as a % of Net Revenues 2017 vs. historical PDA as a % of net revenues 4 Upside based on current net debt and debt cost vs

30 5. FINANCIAL HIGHLIGHTS SHOPPING VILLA-LOBOS- SP 29

31 FINANCIAL HIGHLIGHTS Top Line NET REVENUE PERFORMANCE (R$ MILHÕES) GROSS REVENUE BREAKDOWN CAGR 06-17: 27.8% Gross Revenue Breakdown 1Q18 1Q17 % 1,348.0 Base Rent 57.6% 58.4% -0.8 p.p. Mall & Media 8.7% 8.7% 0.0 p.p. Overage Rent 4.3% 3.9% 0.4 p.p. Rents 70.6% 71.0% -0.4 p.p. Gross Revenue Breakdown 1Q18 1Q17 % Rents 70.6% 71.0% -0.4 p.p. Parking 20.3% 19.0% 1.2 p.p. Services 6.4% 6.8% -0.3 p.p. Key Money 1.8% 2.5% -0.7 p.p Transfer Fee 0.3% 0.3% -0.1 p.p. Others 0.6% 0.4% 0.2 p.p Gross Revenue 100.0% 100.0% - 30

32 FINANCIAL HIGHLIGHTS Historical Financial Performance ADJUSTED EBITDA (R$ MILLION) AND ADJUSTED EBITDA MARGIN NOI (R$ MILLION) AND NOI MARGIN (%) 00,00 00,00 00,00 00,00 00,00 00,00 00,00,00 CAGR 06-17: 28.0% Average Margin: 75.3% 63.4% % 120% 100% 80% 65.0% 60% 40% 20% 00% 1400, , ,00 800, % 600,00 400,00 200,00,00 CAGR 06-17: 28.8% Average Margin: 89.6% % 120% 100% 88.4% 80% 60% 40% 20% 00% Adjusted EBITDA Adjusted EBITDA Margin NOI NOI Margin 00,00 140% 800,0 145, 00,00ADJUSTED FFO (R$ MILLION) AND ADJUSTED FFO MARGIN ADJUSTED NET INCOME (R$ MILLION) AND MARGIN (%) 700,0 120% 125, 00,00 CAGR 06-17: 24.1% 600,0 100% CAGR 06-17: 26.0% 105, 00,00 Average Margin: 38.9% ,0 Average Margin: 32.8% 80% ,0 00,00 400,0 00,00 60% 65,0 300,0 43.6% 00,00 40% 35,2% 45,0 31.6% 200,0 30,3% 00, % 100,0 25,0 32.1,00 00% 0,0 5,0% ,0-15,0 Adjusted FFO Adjusted FFO Margin Adjusted Net Income Adjusted Net Income Margin 31

33 6. APPENDIX SHOPPING TAMBORÉ - SP 32

34 APPENDIX Shopping Malls: Brazilian s favorite leisure destionation TOP LEISURE ACTIVITIES HIGHLIGHTS Rio de Janeiro, 2013 Go to the Shopping Mall 77% The frequency of visits to a shopping mall remained constant over the past few years (2012: 7x/month 2016: 7x/month) Beach Cinema 74% 68% Clients seek security, brands, convenience and variety Shows Parties 56% 54% Brazilian consumers prefer immediate satisfaction MAIN REASONS WHY CUSTOMERS GO TO THE MALL Street shops usually have low quality of service and low variety Considers all ages, 2016 Other 21% Shopping 28% Perception of security inside the city Cinema 3% Dating 4% Diversified services for all ages (gym, hair salon, spa, games, etc.) Leisure 14% Source: BR Malls, ABRASCE and Veja Eating 15% Services 15% 33

35 22.9% 21.0% 18.9% APPENDIX E-commerce in Brazil E-COMMERCE SHARE IN TOTAL RETAIL SALES (%) E-COMMERCE SHARE IN TOTAL CHRISTMAS SALES (%) % 27.0% 9.8% 8.4% 7.5% 16.3% 13.2% 12.2% 8.5% 5.7% 5.4% 5.1% 3.3% 2.0% 6.9% 3.1% MAIN CHALLENGES FOR THE E-COMMERCE CONSOLIDATION IN BRAZIL FOR THE TENANT High logistics cost High cost of capital (inventory, working capital) Fiscal complexity Franchising model FOR THE CUSTOMER Incremental Costs (shipping costs) High level of delay in deliveries High average delivery time (10 days) Source: BRMALLS, ABRASCE and Statista 34

36 APPENDIX Brazilian Mall Industry Offers Potential for Growth and Expansion GLA PER 1,000 HABITANTS (m²) % OF RETAIL SALES IN SHOPPING MALLS 2, % 55.1% 1, % 46.9% 1, % 19.4% 18.9% USA Canada Australia South France Mexico Brazil Canada USA Africa South Africa Australia France Mexico Brazil Source: Abrasce,

37 APPENDIX Delivery Center SHIP FROM MALL: E-commerce and Marketplaces integration to the mal s stores and execution of physical delivery Delivery SAME-DAY or SAME-HOUR Malls as LAST-MILE distribution centers Association and non-controlling investment at Delivery Center INDEPENDENT management by Delivery Center ROLL-OUT: starting in malls at Porto Alegre and Rio de Janeiro (2018) ORDER PICKING Open platform; websites and marketplaces integrator. EXPEDITION Malls: privileged location; preselected mix; tenants invetory; consumers base. DELIVERY Same-day, Same-hour delivery, with routing, tracking and payment solution. 36

38 APPENDIX Historical Financial Performance CAGR (' LTM R$ MILLION Q18 '17) ¹ Gross Revenue , , , , , , % ,426.5 Services % Net Revenues , , , , , , % ,316.7 NOI , , , , , , % ,172.4 NOI Margin 80.9% 86.7% 90.4% 91.9% 89.3% 90.2% 91.3% 91.7% 91.8% 91.8% 90.2% 88.4% * 87.9% 88.2% Adjusted EBITDA , , , , % Adjusted EBITDA Margin 63.4% 67.8% 74.9% 75.3% 81.4% 79.5% 81.0% 81.0% 80.3% 79.7% 74.2% 65.0% * 78.0% 67.3% Adjusted FFO % Adjusted FFO Margin 43.6% 38.1% 43.6% 59.3% 52.2% 38.4% 37.4% 38.1% 33.7% 28.6% 21.8% 31.6% * 51.7% 35.4% Adjusted Net Income % Adjusted Net Income Margin 35.2% -1.4% 17.6% 72.4% 48.3% 35.9% 36.4% 37.4% 32.9% 27.8% 20.4% 30.3% * 50.3% 32.7% Total GLA (m²) 212, , ,131 1,032,586 1,197,146 1,433,524 1,620,625 1,688,603 1,690,953 1,638,072 1,645,672 1,445, % 1,445,5 36 1,445,536 Added GLA (m²) 659, ,795 48, , , ,101 67,978 2,351-52,881 7, ,136 * ,136 37

39 APPENDIX Top 25 NOI NOI 1Q18 ¹ NOI 1Q17 ¹ % NOI/m² 1Q18 ¹ Rent/m² 1Q18 ² NOI 1Q18 100% 1 Plaza Niterói 28,250 29, % ,250 2 Tijuca 26,588 28, % ,588 3 NorteShopping 20,540 20, % ,058 4 Tamboré 16,075 17, % ,075 5 Uberlândia 15,241 14, % ,241 6 Londrina 13,380 13, % ,387 7 Shopping Recife 11,650 11, % ,788 8 Estação 10,617 9, % ,617 9 Mooca 9,685 10, % , Metrô Santa Cruz 9,476 9, % , Campo Grande 9,313 9, % , Villa-Lobos 8,917 10, % , Campinas Shopping 7,911 9, % , Estação BH 6,779 6, % , Independência Shopping 6,708 6, % , Del Rey 6,507 6, % , Jardim Sul 5,467 5, % , São Bernardo 5,165 5, % , Maringá 4,270 5, % , Goiânia 3,998 3, % , Capim Dourado 3,986 4, % , Shopping Piracicaba 3,823 3, % , Rio Anil 3,600 3, % , Amazonas Shopping 3,306 3, % , Shopping Curitiba 3,190 3, % ,511 TOTAL TOP , , % ,522 Divested Assets³ - 20,997 - Others 23,419 22, % Total 267, , % TOTAL EX-DIVESTED ASSETS 267, , % % OF TOTAL NOI TOP15/Total 201, , % % 258,668 TOP20/Total 226, , % % 298,876 TOP25/Total 244, , % % 338,522 ¹ Straight Lined NOI (NOI + Base Rent Straight-Lining + Key Money Straight-Lining) regarding BRMALLS interest in each asset. ² Straight-lined Base rents, excluding discounts, + Mall + Media ³ Divested assets in 2017: March/2017: ItaúPower; December/2017: Minas Shopping, Granja Vianna, Shopping Paralela, Natal Shopping and Maceió Shopping. 38

40 APPENDIX Top 25 Sales Sales 1Q18¹ Sales 1Q17¹ % Sales/m² ² Occupancy Rate ³ 1 Plaza Niterói 246, , % 1, % 2 Tijuca 217, , % 2, % 3 NorteShopping 319, , % 1, % 4 Tamboré 168, , % 1, % 5 Uberlândia 174, , % 1, % 6 Londrina 158, , % 1, % 7 Shopping Recife 364, , % 1, % 8 Estação 90,481 87, % 1, % 9 Mooca 135, , % 1, % 10 Metrô Santa Cruz 103, , % 1, % 11 Campo Grande 130, , % 1, % 12 Villa-Lobos 136, , % 1, % 13 Campinas Shopping 74,944 74, % % 14 Estação BH 109,307 91, % 1, % 15 Independência Shopping 77,259 71, % 1, % 16 Del Rey 117, , % 1, % 17 Jardim Sul 115, , % 1, % 18 São Bernardo 94,677 88, % % 19 Maringá 78,450 67, % 1, % 20 Goiânia 98,386 95, % 1, % 21 Capim Dourado 67,541 70, % % 22 Shopping Piracicaba 124, , % % 23 Rio Anil 103, , % 1, % 24 Amazonas Shopping 164, , % 1, % 25 Shopping Curitiba 66,792 67, % 1, % Total Top 25 3,540,280 3,403, % 1, % Divested Assets 4-614,462 - Others 1,062,413 1,001, % BRMALLS Total 4,602,693 5,018, % 1, % Total Ex-Divested Assets 4,602,693 4,404, % TOP15/Total 2,508,661 2,417, % 1, % TOP20/Total 3,013,387 2,893, % 1, % TOP25/Total 3,540,280 3,403, % 1, % 1 Sales based on a consolidated (100%) view. 2 Considers Adjusted GLA as stated in page 5. 3 Monthly average of the occupancy rate during the quarter. 4 Divested assets in 2017: March/2017: ItaúPower; December/2017: Minas Shopping, Granja Vianna, Shopping Paralela, Natal Shopping and Maceió Shopping. 39

41 APPENDIX Historical Operational Performance 1T15 2T15 3T15 4T15 1T16 2T16 3T16 4T16 1T17 2T17 3T17 4T17 1T18 SSS (%) 5.9% 3.6% 2.3% 0.9% 1.2% -1.7% -0.6% -0.6% 0.4% 5.3% 4.6% 1.6% 2.7% 2.5% 1Q Average SSR (%) 7.6% 7.0% 7.4% 6.4% 7.4% 2.2% 2.6% 5.3% 6.5% 7.5% 4.3% 1.7% 0.4% 7.2% -6.8 p.p. Sales/m² 1,131 1,186 1,149 1,537 1,126 1,165 1,155 1,546 1,144 1,249 1,233 1,583 1,200 1, % Rent/m² % NOI/m² % Occupancy Cost (% Sales) 11.4% 11.0% 11.4% 10.3% 12.1% 11.3% 11.7% 10.7% 11.8% 11.2% 11.2% 11.6% 11.6% 11.7% -0.1 p.p. Late Payments (average quarter) 6.9% 7.6% 6.5% 5.6% 7.9% 8.9% 9.3% 12.8% 13.9% 10.8% 9.5% 9.6% 9.6% 9.6% 0.0 p.p. Net Late Payments 4.4% 3.7% 2.6% 1.9% 5.7% 4.8% 3.7% 5.5% 7.3% 1.6% 1.7% 1.3% 4.8% 5.8% -1.0 p.p. Occupancy (%) 97.2% 97.0% 96.8% 96.9% 96.8% 95.8% 95.5% 96.2% 96.1% 94.7% 95.2% 96.2% 96.5% 96.7% -0.2 p.p. Tenant Turnover 5.1% 5.4% 5.5% 4.6% 5.1% 4.9% 5.3% 6,6% 7.0% 7.4% 8.0% 9.1% 8.5% 5.7% 2.8 p.p. 0.2 p.p. 40

42 APPENDIX Delinquency Rate 9.6% Late Payments 4.8% 4.8% Net Late Payments (cash basis) Total amount of receivables during the month 100% 90.4% Received within the due date Late Payments: considers all receivables that were not effectively collected during the same month as its original due date. Net Late Payments: the same as late payments (explained above), but it also considers collections from overdue receivables from previous periods. Our collection criteria considers collecting first the oldest past due receivable from the tenant. Therefore, when there are cash recoveries, they will be associated to the oldest expired receivables, comparable to a First In, First Out (FIFO) criteria. Note: the values used as examples reference the actual values of these indicators during 1Q18. 41

43 APPENDIX Provisions for Doubtful Accounts 4Q17 CRITERIA NEW CRITERIA IFRS 9 PROVISION RECOVERY PROVISION RECOVERY OVERDUE debt with aging of over 180 days CASH BASIS recovery or CONFESSION OF INDEBTNESS¹ % of client s OVERDUE AND FALLING DUE balance based on aging ranges CASH BASIS recovery According to CPC 48, the composition of the provisions for doubtful accounts should be registered based on historical recovery rate ranges, including the outstanding balance of delinquent tenants (as shown on the table on the right). During the quarter, the Company adopted a new criteria to account for its provisioning for doubtful accounts (in line with CPC 48 requirements) and due to this, there was an impact of R$51.6 million registered in the Company s shareholder s equity. ¹After the confession of indebtness, the whole confessed balance (previously recovered) would come back as a provision after the 1st late payment. From this moment on, a recovery only occurred after the payment (cash basis) of new confessions. RANGES: AGING (days) % OF PROVISION 0 to 30 0% 31 to 60 20% 61 to 90 35% 91 to % 121 to % 151 to % > % o Aging = number of incurred days since the oldest overdue invoice. o % of Provision = % applied on overdue and falling due balances, according to the clients oldest overdue balance. 42

44 CONTACTS AND IR TEAM Frederico Villa - CFO Tel: frederico.villa@brmalls.com.br Derek Tang Corporate Finance & IR Director Tel: derek.tang@brmalls.com.br Guilherme Lahr Specialist Tel: guilherme.lahr@brmalls.com.br Antonio Velloso - Intern Tel: antonio.velloso@brmalls.com.br ri@brmalls.com.br Tel: Fax:

45 DISCLAIMER The material that follows is a presentation of general background information about BR Malls Participações S.A. and its consolidated subsidiaries ( BR Malls" or the "Company") as of the date of the presentation. It is information in summary form and does not purport to be complete and is not intended to be relied upon as advice to potential investors. You should consult the offering memorandum for complete information about the transaction and base your investment decision on such offering memorandum. No representations or warranties, express or implied, are made as to, and no reliance should be placed on, the accuracy, fairness or completeness of the forecasted information presented or contained in this presentation. Neither the Company nor any of its affiliates, advisers or representatives, accepts any responsibility whatsoever for any loss or damage arising from any information presented or contained in this presentation. The information presented or contained in this presentation is current as of the date hereof and is subject to change without notice and its accuracy is not guaranteed. Neither the Company nor any of its affiliates, advisers or representatives make any undertaking to update any such information subsequent to the date hereof. This presentation should not be construed as legal, tax, investment or other advice. Certain data in this presentation was obtained from various external data sources, and the Company has not verified such data with independent sources. Accordingly, the Company makes no representations as to the accuracy or completeness of that data, and such data involves risks and uncertainties and is subject to change based on various factors. This presentation contains forward-looking statements. Such statements are not statements of historical facts, and reflect the beliefs and expectations of BR Malls management. The words "anticipates", "wishes", "expects", "estimates", "intends", "forecasts", "plans", "predicts", "projects", "targets" and similar words are intended to identify these statements. Although the Company believes that expectations and assumptions reflected in the forward-looking statements are reasonable based on information currently available to the Company's management, the Company cannot guarantee future results or events. You are cautioned not to rely on forward-looking statements as actual results could differ materially from those expressed or implied in the forward-looking statements. Securities may not be offered or sold in the United States unless they are registered or exempt from registration under the U.S. Securities Act of 1933, as amended (the Securities Act ). Any offering of securities to be made will be made solely by means of an offering circular. This presentation does not constitute an offer, or invitation, or solicitation of an offer, to subscribe for or purchase any securities, and neither any part of this presentation nor any information or statement contained therein shall form the basis of or be relied upon in connection with any contract or commitment whatsoever. Any decision to purchase securities in any offering of securities of the Company should be made solely on the basis of the information contained in the offering document which may be published or distributed in due course in connection with any offering of securities of the Company, if any. This presentation is being made only to investors that, by means of their attendance at this presentation, represent to the underwriters and the agents that they are Qualified Institutional Buyers as that term is defined in the Securities Act. 44