RIPLEY CORP. July 2008

Transcription

1 RIPLEY CORP Credit Suisse Latam Conference July 2008

2 Ripley Today current operations Department stores 50 stores in Chile and Peru selling space: 323,064 sqm Financial Retail Chilean credit card loans: US$ 1,086 m Banco Ripley Peru loans: US$ 314 m Banco Ripley Chile loans: US$ 537 m Real Estate ownership in 7 malls weighted average leasing space: 101,211 sqm owned stores: 20 Loans as of March

3 Ripley Corp Ripley Today Chile: increasing profitability Peru: leadership on high growth market 4. Mexico: the implementation 5. Conclusion 2

4 Ripley Today 52 years of history Ripley Punta Arenas Ripley Alameda San Diego First Department Store in Santiago Credit business starts 1986 Barros Arana First Department Store outside Santiago Alto Las Condes Insurance brokerage business starts Ripley Jockey Plaza First Department Store in Peru Banco Ripley Chile 2005 Ripley Corp: IPO 2007 Mexico: JV with Palacio de Hierro Peru: JV with Mall Plaza Chile: JV with Plaza S.A. Ripley Corp: Capital increase Corporate Bond 1956 First Store opened in Chile 1993 Parque Arauco Ripley Chile begins its new positioning 2003 Ripley Chile Bond issuance 4

5 Ripley Today shareholders structure Free Float 19.0% Retail 52.2% Pension Funds 19.8% Foreign Investors (Cap XIV) 18.6% Calderon Group 81.0% Insurance Co 4.0% Mutual Funds 5.4% Source: Ripley. Information as of June 27th

6 Ripley Today financial retail CHILE Tarjeta Ripley Loans: US$ 1,086 m Revenues 07: US$ 354 m Provisions/loans: 8.4% Banco Ripley Chile Loans: US$ 537 m 48 branches PERU Banco Ripley Peru Loans: US$ 314 m Revenues 07: US$ 118 m Provisions/loans: 5.8% 11 branches Loans stock Portfolio 1,693 1,453 1, % 3% % 22% % 27% Dec 2005 Dec 2006 Dec 2007 Banco Ripley Peru (US$ m) Chile (US$ m) Banco Ripley Chile (US$ m) Source: Ripley Figures as of December

7 Ripley Today department stores CHILE 40 stores Revenues: US$ 1,045 m Market share: 25% Selling space: 228,086 sqm Paris 24.9% La Polar 12.4% Falabella 37.3% PERU 10 stores Revenues: US$ 361 m Market share: 47% Selling space: 94,978 sqm Ripley 25.4% Ripley 47.0% Falabella 53.0% Source: Ripley Revenues and market share as of december 2007 in million of USD. Selling space as of april

8 Ripley Today real estate business Ownership in 7 Shopping malls 101,211 sqm weighted average selling space Fully owned malls revenues 07: US$ 16 m Shopping Mall Country Leasing Space (sqm) % ownership Ripley Panoramico Chile 5, % Mall del Centro Chile 18, % Mall del Centro de RancaguaChile 13, % Calama Chile 44,206 25% Marina Arauco Chile 57,968 33% Mall del Centro de Curico Chile 45,911 33% Trujillo Peru 44,114 40% Peru: Joint venture with Mall Plaza, to build and exploit shopping malls: Chile: o The first one was opened Ripley has an option of 22.5% in 3 shopping malls of Mall Plaza. in Trujillo on December Source: Ripley 8

9 Ripley Today revenues breakdown Ripley Corp revenues Peru 24% US$ 2,173 m (LTM as of March 08) Chile 76% Source: Ripley LTM: Last twelve months 9

10 Ripley Corp Ripley Today Chile: increasing profitability Peru: leadership on high growth market 4. Mexico: the implementation 5. Conclusions 11

11 Ripley Today revenues & EBITDA evolution ,023 1,239 1,439 1,642 1,774 1,906 2,029 2,159 2, LTM March 08 Revenues (US$ m as of March 2008) EBITDA (US$ m as of March 2008) Source: Ripley LTM: Last twelve months 10

12 Ripley Chile: increasing profitability Selective squared meters growth to follow market growth New distribution center start up New management structure Strength our solid loans portfolio Growth on real estate business through Mall Plaza 12

13 Ripley Chile: increasing profitability Selective squared meters growth to follow market growth Chile: The market grows, but the offer grows even more 26.9% real variation % 14.8% Retail* Private consumption Industry selling space** * Real sales retail index, excluding cars (INE) ** Selling space sum of Ripley, Paris, Falabella and La Polar. Source: Companies reports 13

14 Ripley Chile: increasing profitability Selective squared meters growth to follow market growth 6 new stores between Ripley Punta Arenas opening April 2008 selling space 7,297 sqm Ripley Alameda opening April 2008 selling space 8,262 sqm Ripley Agustinas closing January 2008 selling space 953 sqm Ripley Punta Arenas Store Ripley Alameda Store 15

15 Ripley Chile: increasing profitability Selective squared meters growth to follow market growth Nominal Same Store Sales variation* 9.9% 3.9% 3.4% *Avarage reported by Falabella, La Polar, Paris y Ripley Source: Ripley based on quarterly reports informed by the Companies 14

16 Ripley Chile: increasing profitability Selective squared meters growth to follow market growth New distribution center start up New management structure Strength our solid loans portfolio Growth on real estate business through Mall Plaza 16

17 Ripley Chile: increasing profitability New distribution center 17

18 Ripley Chile: increasing profitability New management structure Andrés Roccatagliata CEO Retail sfinancial Products Channels Marketing Risk Operations & Technology Development & Control 19

19 Ripley Chile: increasing profitability Selective squared meters growth to follow market growth New distribution center start up New management structure Strength our solid loans portfolio Growth on real estate business through Mall Plaza 18

20 Ripley Chile: increasing profitability Selective squared meters growth to follow market growth New distribution center start up New management structure Strength our solid loans portfolio Growth on real estate business through Mall Plaza 20

21 Ripley Chile: increasing profitability Strength our solid loans portfolio Sixth Cencosud 4.9% player Itau Chile 2.8% BBVA 4.3% in chilean December Others 10.9% financial 2007 market Santander 20.6% Corpbanca 5.1% Chile+Citi 16.8% Ripley + Banco Ripley Chile 6.1% BCI 8.9% Estado 8.9% Falabella+CMR 10.8% Source: Ripley based on SBIF data, Banks and more Department Stores are included 21

22 Ripley Chile: increasing profitability Selective squared meters growth to follow market growth New distribution center start up New management structure Strength our solid loans portfolio Growth on real estate business through Mall Plaza 23

23 Ripley Chile: increasing profitability Strength our solid loans portfolio Sustainable growth on credit card loans portfolio Wide client base / cross selling Strong and strict credit and risk systems 16.3% 21.7% Loans stock (US$ m as of Dec 2007) 22

24 Ripley Chile: increasing profitability Growth on real estate business through Mall Plaza Long term lease contract with Mall Plaza Alameda S.A., Plaza Cordillera S.A. and Plaza San Bernardo S.A. Option to buy 22.5% of those societies 24

25 Ripley Corp Ripley Today Chile: increasing profitability 3. Peru: leadership on high growth market 4. Mexico: the implementation 5. Conclusions 25

26 Ripley Peru: leadership on high growth market Macroeconomic environment A growing market... Annual Private Consumption Growth 11.7% 5.5% 2.7% 0.3% Source: Banco Central del Perú 27

27 Ripley Peru: leadership on high growth market Macroeconomic environment Excellent market positioning Important store opening plan Growth on loans portfolio with Banco Ripley Peru Growth on real estate business with Mall Plaza joint venture Financial statements of Banco Ripley Peru will not consolidate in Ripley Corp from 2Q08 onwards 26

28 Ripley Peru: leadership on high growth market Macroeconomic environment...there is a lack of department stores... department stores sqm / 1000 inhabitants 49 6 Peru Chile Source: Banco Central del Peru 28

29 Ripley Peru: leadership on high growth market Macroeconomic environment Excellent market positioning Important store opening plan Growth on loans portfolio with Banco Ripley Peru Growth on real estate business with Mall Plaza joint venture Financial statements of Banco Ripley Peru will not consolidate in Ripley Corp from 2Q08 onwards 29

30 Ripley Peru: leadership on high growth market Macroeconomic environment Excellent market positioning Important store opening plan Growth on loans portfolio with Banco Ripley Peru Growth on real estate business with Mall Plaza joint venture Financial statements of Banco Ripley Peru will not consolidate in Ripley Corp from 2Q08 onwards 31

31 Ripley Peru: leadership on high growth market Excellent market positioning Ripley Peru is number 1 on market share in Lima and number 2 in the country Lima Peru Saga Falabella 46% Ripley 54% Saga Falabella 53% Ripley 47% Source: Ripley Ripley has the best preference level among retailers June 07 Others 15% Others June 08 4% Falabella 32% Ripley 43% Falabella 33% Ripley 48% Source: Inmark Peru Max 10% Max 15% 30

32 Ripley Peru: leadership on high growth market Important store opening plan 6 new stores Trujillo: first store outside Lima Trujillo Store opening 32

33 Ripley Peru: leadership on high growth market Important store opening plan Same Store Sales grows in Ripley Peru... real variation on SSS in nuevos soles 15.2% 10.2% 11.2% 9.5% 3.2% Mar 07 Jun 07 Sep 07 Dec 07 Mar 08 Source: Press Release 1Q 08 of Ripley Corp 33

34 Ripley Peru: leadership on high growth market Growth on loans portfolio with Banco Ripley Peru 27.4% 30.4% Loans stock portfolio (US$ m Dec 2007) Source: Ripley 35

35 Ripley Peru: leadership on high growth market Macroeconomic environment Excellent market positioning Important store opening plan Growth on loans portfolio with Banco Ripley Peru Growth on real estate business with Mall Plaza joint venture Financial statements of Banco Ripley Peru will not consolidate in Ripley Corp from 2Q08 onwards 34

36 Ripley Peru: leadership on high growth market Growth on loans portfolio with Banco Ripley Peru Sixth player in peruvian December 2007 loans market Banco Financiero 3.0% Others 16.7% BCP 17.1% Banco del Trabajo 3.5% Citibank 5.5% Interbank 14.9% Banco Ripley Peru 5.9% (former Financiera Cordillera) Falabella Peru S.A 6.3% Continental 14.0% Scotiabank Peru 13.1% 36

37 Ripley Peru: leadership on high growth market Macroeconomic environment Excellent market positioning Important store opening plan Growth on loans portfolio with Banco Ripley Peru Growth on real estate business with Mall Plaza joint venture Financial statements of Banco Ripley Peru will not consolidate in Ripley Corp from 2Q08 onwards 37

38 Ripley Peru: leadership on high growth market Macroeconomic environment Excellent market positioning Important store opening plan Growth on loans portfolio with Banco Ripley Peru Growth on real estate business with Mall Plaza joint venture Financial statements of Banco Ripley Peru will not consolidate in Ripley Corp from 2Q08 onwards 39

39 Ripley Peru: leadership on high growth market Growth on real estate business with Mall Plaza joint venture Joint Venture with Mall Plaza s and Falabella s peruvian subsidiaries for the construction and operation of shopping malls in Peru. Opening of Trujillo Store 38

40 Ripley Peru: leadership on high growth market Financial statements will not consolidate On Jan 14 th Financiera Cordillera was authorized to function as a Bank in Peru On April 21 st, Banco Ripley Peru was inaugurated formally On June 12 th Chilean SVS authorized Ripley Corp to not consolidate Banco Ripley Peru on its financial statements From 2Q 2008, Banco Ripley Peru results will be included under Profit (loss) on investments in related companies of Ripley Corp financial statements 40

41 Ripley Peru: leadership on high growth market Financial statements will not consolidate Dec 06 Dec 07 Mar 07 Mar 08 Current Proforma Current Proforma Current Proforma Current Proforma Revenues EBIT Investments in related companies Net Income EBITDA Margin EBITDA 12,0% 11,0% 10,2% 8,8% 8,3% 7,8% 10,0% 8,3% Dec 06 Dec 07 Mar 07 Mar 08 Current Proforma Current Proforma Current Proforma Current Proforma Loans Portfolio Investments in related companies Short Term Debt Long Term Debt Equity Source: Ripley amounts in US$ million as of March

42 Mexico: the implementation Positive macroeconomic environment Grupo Bal: a partner of excellence Advances in the business plan 43

43 Ripley Corp Ripley Today Chile: increasing profitability 3. Peru: leadership on high growth market 4. Mexico: the implementation 5. Conclusion 42

44 Mexico: the implementation Positive macroeconomic environment CONSUMPTION EVOLUTION 130 (2001 Base 100) CONSUMER LOANS EVOLUTION & RISK Durable Goods Non durable goods Services Total Source: Banxico Miles de Millones de Pesos Consumer loans X % past due loans % 15.0% 10.0% 5.0% 0.0% 44

45 Mexico: the implementation Positive macroeconomic environment LOW BANKING PENETRATION (2006) 180% 160% 140% 120% China Malasia Taiwan Japan Germany USA UK CONSUMER LOANS 45 Loans/PGB Loans and Spread 100% 80% 60% 40% 20% 0% 60% 50% 40% 30% 20% 10% 0% Chile Corea India Hungria Brasil Czech Republic Polonia Colombia Mexico Argentina 0 10,000 20,000 30,000 40,000 50,000 GDP/Capita STABLE SPREAD IN CONSUMER LOANS Jan 99 Jun 99 Deposits rate Loan rate Spread Nov 99 Apr 00 Sep 00 Feb 01 Jul 01 Dec 01 May 02 Oct 02 Mar 03 Ago 03 Jan 04 Jun 04 Nov 04 Apr 05 Sep 05 Feb 06 Jul 06 Dec 06 May 07 30% 25% 20% 15% 10% 5% 0% Depostis China India Argentina Colombia Mexico Brazil Poland Czech Republic Chile Hungary Malaysia South Korea Germany Taiwan UK Japan USA PER CAPITA (US$)(2006) ,002 1,752 2,699 3,509 Source: Banxico, Merrill Lynch 5,011 6,688 7,887 7,951

46 Mexico: the implementation Positive macroeconomic environment Mexican department stores*: revenues and EBITDA margin evolution (US$ m) 14.7% 15.6% 15.5% 15.0% 14.6% 14.9% 4,372 5,104 5,635 6,120 7,304 8,472 9,346 10,728 11, Revenues EBITDA margin *Data based on Financial Statements of Coopel, Liverpool, Elektra, Famsa. Source: Ripley 47

47 Mexico: the implementation Positive macroeconomic environment RETAIL REVENUES COMPOSITION (Billon US$) (ROIC) 142,3 111,8 37% % 18.2% % 78% 63% % 16.1% 22% % Non Food Food % Formal retail Traditional Jun % Source: Planet Retail as of Dec 2006 Source: Ripley based on Financial Statements of Elektra, Liverpool, Famsa and Coppel 46

48 Mexico: the implementation Positive macroeconomic environment Grupo Bal: a partner of excellence Advances in the business plan 48

49 Mexico: the implementation Grupo Bal: a partner of excellence Grupo Bal is one of most important business group of Mexico o o It is Controlled by Baillères s Family It has participation on the followings businesses: Mining Industry, Industrial Activity, Financial Market, Agriculture Industry and Retail. Leading Holding s enterprise: o o o Palacio de Hierro: Is the most exclusive and prestigious department store in Mexico Peñoles: Is the world leading company in production of Silver. Its Market Cap is estimated in about US$ 12,000 million GNP: Is the leading insurance company in Mexico with a market share of 20% o Profuturo: Pension Fund Company with more than 3,4 million affiliates and number one in profits during the past 8 years o Valmex: Brokerage and Rental Company In addition, Grupo Bal funded and participate in the board of directors of Instituto Tecnologico Autonomo of Mexico (ITAM), one of leading universities in Mexico with more than 5,000 students. 49

50 Mexico: the implementation Advances in the business plan Leaders of the JV are living in Mexico Second line teams formation Negotiations with diverse real estate developers First stores openings:

51 Mexico: the implementation Positive macroeconomic environment Grupo Bal: a partner of excellence Advances in the business plan 50

52 Ripley Corp Ripley Today Chile: increasing profitability Peru: leadership on high growth market 4. Mexico: the implementation 5. Conclusion 52

53 Conclusions Chile: Focus on creation of value Selective square meters growth to follow market growth New distribution center start up New management structure Strength our solid loans position Growth on real estate business through Mall Plaza Peru: leadership on high growth market Excellent market positioning Important store opening plan Growth on loans portfolio with Banco Ripley Peru Growth on real estate business with Mall Plaza joint venture Mexico: The implementation First store openings:

54 RIPLEY CORP Credit Suisse Latam Conference July 2008