Ripley Corp. November rd Quarter 2016 Results

Transcription

1 Ripley Corp November rd Quarter 2016 Results

2 HIGHLIGHTS Aventura Plaza S.A. division generates non-operational profit Change of provision model in Ripley Bank Chile Ripley Bank Peru issues certificates and distributes dividends RESULTS Ripley Corp: EBITDA increases 21% excluding non-recurring effects Ripley Chile: Positive SSS and improving margins in retail; Bank s operational costs continues downward trend Ripley Peru: Positive SSS and continued growth of the loan portfolio LOOKING FORWARD Retail: Focus on growth through profitability and efficiency Bank: Growth focused in existing clients, developing new products to create a bank focused on people Real Estate: Improve profitability as new projects are launched and existing projects mature

3 HIGHLIGHTS Aventura Plaza S.A. division generates non-operational profit Change of provision model in Ripley Bank Chile Ripley Bank Peru issues certificates and distributes dividends RESULTS Ripley Corp: EBITDA increases 21% excluding non-recurring effects Ripley Chile: Positive SSS and improving margins in retail; Bank s operational costs continues downward trend Ripley Peru: Positive SSS and continued growth of the loan portfolio LOOKING FORWARD Retail: Focus on growth through profitability and efficiency Bank: Growth focused in existing clients, developing new products to create a bank focused on people Real Estate: Improve profitability as new projects are launched and existing projects mature

4 AVENTURA PLAZA S.A. DIVISION GENERATES NON- OPERATIONAL PROFIT On July of this year, the division of Aventura Plaza S.A. in Peru was completed, which was executed proportionally to the ownership that the entities held in such company. As a consequence, and according to IFRS, Ripley Corp revalued its investment to economic value, which generated an additional non-operating profit for this quarter of MM$34,236, which includes a reclassification to results in exchange differences of MM$2,214 that didn t impact equity. During the past quarter, a change in the valuation policy of investment properties from historical cost to fair value was adopted, which increased equity related to Aventura Plaza in MM$46,822. HIGHLIGHTS THIS NON-CASH EFFECT BETTER REFLECTS THE VALUE OF OUR INVESTMENTS IN REAL ESTATE

5 CHANGE IN PROVISIONS MODEL IN BANK RIPLEY CHILE HIGHLIGHTS On October of this year, Ripley Bank Chile carried out a modification in its provision model, in line with the requirements of the regulator. The new model incorporates variations in the methodology of provisions such as the inclusion of drag portfolio. Thus, central offices in Chile recognized during the quarter a non-recurring charge of MM$6,301. Bank Ripley Chile had already recognized a charge of MM$2,000 for this same purpose. This totalizes a consolidated charge of MM$8,301 in. THIS CHANGE IS NOT RELATED TO VARIATIONS IN THE PAYMENT BEHAVIOUR OF OUR CLIENTS AND HAS NO CASH EFFECT

6 HIGHLIGHTS NEGOTIABLE CERTIFICATE OF DEPOSIT (NCD s) ISSUANCE AND DISTRIBUTION OF DIVIDENDS BY RIPLEY BANK PERU On September 13 th the fourth financial instruments issuance of the year, which was for an amount of S/.50 million, was executed with a NCD s auction Achieving a demand equivalent to 4.1x the placed sum. On the other hand, on the 29 th of that same month, Ripley Bank Peru distributed dividends to its parent company for a sum of S/.30 million in retained earnings. FOURTH FINANCIAL INSTRUMENTS ISSUANCE OF THE YEAR REFLECTS THE TRUST THE LOCAL MARKET HAS IN RIPLEY BANK PERU

7 HIGHLIGHTS Aventura Plaza S.A. division generates non-operational profit Change of provision model in Ripley Bank Chile Ripley Bank Peru issues certificates and distributes dividends RESULTS Ripley Corp: EBITDA increases 21% excluding non-recurring effects Ripley Chile: Positive SSS and improving margins in retail; Bank s operational costs continues downward trend Ripley Peru: Positive SSS and continued growth of the loan portfolio LOOKING FORWARD Retail: Focus on growth through profitability and efficiency Bank: Growth focused in existing clients, developing new products to create a bank focused on people Real Estate: Improve profitability as new projects are launched and existing projects mature

8 Extraordinary effects REVENUES: 2.9% increase Positive SSS in both countries of operation 3.9% growth of consolidated loan portfolio EBITDA: 21% increase w/o change in provisions model Increase in consolidated gross margins RIPLEY CORP RESULTS 3 rd QUARTER 2016 RESULTS NET INCOME: increases to $37,549 ($9,529 w/o new provisions model nor the fair value of Ripley Aventura) CONTINUED OPERATIONS: $35,318 in ($7,298 w/o new provisions model and fair value of Ripley Aventura) Non-recurring charges of $2,363 related to the new service model & other restructuring DISCONTINUED OPERATIONS: Earnings of $2,231 in v/s $2,002 losses in 3Q15. Closing process in Colombia progressing according to plan ,549 9,529 3Q15 Net Income PROFIT FROM FAIR VALUE OF RIPLEY AVENTURA & DISCONTINUED OPERATIONS PARTIALLY OFFSET BY NEW PROVISIONS MODEL & OTHER NON-RECURRING CHARGES Amounts in CLP millions

9 3 rd QUARTER 2016 RESULTS REVENUES: rise of 4.4% (5.2% SSS) RIPLEY CHILE RETAIL BUSINESS Increase in the apparel departments as well as home electronics 25.9% 158,096 Chile Retail 30.1% 165,105 GROSS MARGIN: Gross Margin/Sales increased in 420 bps Bigger volume of soft goods EBITDA: increased to $1,245 in SG&A increased 14.7% driven by non-recurring expenses of hiring and staff training associated with the new service model of stores 3Q15-1.8% 3Q15 3Q15 Gross Margin/Sales SSS 5.2% IMPROVEMENT IN GROSS MARGIN IN ACCORDANCE WITH THE COMPANY S STRATIGIC PLAN Amounts in CLP millions

10 New provision model REVENUES: 1.1% increase Loan portfolio rose 2.5% RIPLEY CHILE FINANCIAL BUSINESS 3 rd QUARTER 2016 RESULTS Ripley Chile Bank 10.5% 709, % 727,121 OPERATIONAL COSTS: 1.7% decrease (9,4% decrease w/o new provisions model) Funding costs decrease 21.9% Increase of 3.2% in net risk cost Decrease of 9,8% w/o new provisions model 3Q15 Loans Provision/Loans 12,788 NET INCOME: increased 31.1% (48.4% w/o provisions) to $11,298 SG&A decreased 6.1% compared to 3Q15 8,618 11,298 3Q15 Net Income STRONG GROWTH IN NET PROFIT DRIVEN BY IMPROVEMENTS IN OPERATIONAL COSTS Amounts in CLP millions

11 January February March April May June July August September October November December January February March April May June July August September October November December 3 rd QUARTER 2016 RESULTS CREDIT RISK SHOWING STEADY TREND 22% 20% 18% 16% 14% NPL's 1-90 Days Early NPL s improving when compared to previous years During the last months late NPL s maintain the trend of previous years and in lower levels than those showed in ,5% 5,0% 4,5% 4,0% NPL's 90 + Days The rise in Net provision expense is explained by the modification of the provision model in the Bank as shown in the figure. 3,5% Net Provision Expense (Does not consider contingent and prudential provisions) 0,9% RISK CONTINUES TO BEHAVE IN LINE WITH EXPECTATIONS 0,7% 0,5% 0,3% 0,1% Amounts in CLP billions

12 3 rd QUARTER 2016 RESULTS RIPLEY PERU RETAIL BUSINESS REVENUES: 3.7% decrease in Chilean pesos (0.7% SSS) (1.9% increase measured in Peruvian currency) Positive behavior in consumption Remodeling of Jockey Plaza during August and September 25.3% 98,227 Peru Retail 25.6% 94,544 GROSS MARGIN: Slight increase in gross margin over sales ratio attributed to better efficiencies in cost 3Q15 Retail Revenues Gross Margin/Sales EBITDA: reached $1,054, 49.6% lower than 3Q15 SSS 0.7% 3Q15-3.1% 2.9% INCREASE IN GROSS MARGIN IN LOCAL CURRENCY DRIVEN BY SALES AND EFFICIENCIES IN OPERATIONAL COSTS Amounts in CLP millions

13 REVENUES: increased 8.1% compared to 3Q15 RIPLEY PERU FINANCIAL BUSINESS Loan portfolio grew 6.9% 1. Enhanced network productivity and collection processes 2. Aligned relationship between the bank and the store 3 rd QUARTER 2016 RESULTS 5.7% 304,335 Ripley Peru Bank 4.3% 325,483 NET INCOME: 25% decrease, reaching $3,800 Operational costs increase 1. Increase of net risk cost Deterioration in payment behavior of the Peruvian banking system Slight deterioration of early NPL s, however, late NPL s levels are healthy and lower than previous years 2. Financial expenses increased caused by a rise in the interest rates in Peru 3Q15 5,068 3Q15 Loans Provision/Loans 3,800 Net Income BANK S REVENUES CONTINUES TO GROW DRIVEN BY THE INCREASE IN THE LOAN PORTFOLIO Amounts in CLP millions

14 NPL s OF RIPLEY BANK PERU NPL's 1-90 Days NPL's 91+ Days 16% 15% 14% 13% 12% 11% 10% 9% 8% 7% % 5% 4% 3% 2% 1% 0% % 21% 19% 17% 15% 13% 11% 9% 7% Total NPL's NPL s OF RIPLEY BANK PERU KEEP IN ACCORDANCE WITH EXPECTED LEVELS

15 REAL ESTATE BUSINESS 3 rd QUARTER 2016 RESULTS EBITDA GREW 13.2% Mall Concepción: EBITDA decreases 9.8% reaching MM$1,242 in Mall Aventura (*): EBITDA increases 1% to MM$2,768 Inmobiliaria Viña del Mar: 63.5% growth in EBITDA reaching MM$2, % adjusted by investment size Nuevos Desarrollos: 2.6% rise in EBITDA up to MM$2,355 in NET INCOME INCREASES 3.3% 1,377 1,242 2,740 2,768 EBITDA 3Q15 1,779 2,909 Mall Concepción Mall Aventura (*) Inmob. Mall Viña del Mar S.A. 2,296 2,355 Nuevos Desarrollos S.A. Non-consolidated Operations *2015 EBITDA corresponds to 40% of Mall Aventura Plaza PROFITABILITY KEEPS INCREASING AS NEW PROJECTS ARE LAUNCHED AND SHOPPING MALLS MATURE Amounts in CLP millions

16 HIGHLIGHTS Aventura Plaza S.A. division generates non-operational profit Change of provision model in Ripley Bank Chile Ripley Bank Peru issues certificates and distributes dividends RESULTS Ripley Corp: EBITDA increases 21% excluding non-recurring effects Ripley Chile: Positive SSS and improving margins in retail; Bank s operational costs continues downward trend Ripley Peru: Positive SSS and continued growth of the loan portfolio LOOKING FORWARD Retail: Focus on growth through profitability and efficiency Bank: Growth focused in existing clients, developing new products to create a bank focused on people Real Estate: Improve profitability as new projects are launched and existing projects mature

17 REAL ESTATE BANK RETAIL LOOKING FORWARD MAIN FOCUS MAIN SOURCE OF GROWTH & PROFITABILITY ROE LTM* - Fashion & Brands - Increase Profitability Increase in margins through strategic plan focused on brands and new service model Strengthening ecommerce channel Increase in square meters and higher store maturity 0.5% -2.7% - Competitive Credit Card - New Core Banking System Migrate clients to Mastercard Continue growth leveraging on known clients Gradual increase in leverage Develop current accounts & debit cards 19.8% 18.3% - Begin Operation of Projects Under Development Greater maturity of existing shopping malls Developing projects and land banks begin operating 7.7% 4.3 % 6.4%** * Real Estate Net Income doesn t include modification in accounting policy for investment properties in 4Q15. ** Consolidated ROE calculated using continued operations net income Source: Ripley Corp s Sept-16 Financial Results

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