GRAÑA Y MONTERO. Corporate Presentation

Transcription

1 GRAÑA Y MONTERO Corporate Presentation Fourth Quarter 2016

2 Business highlights

3 Grupo Graña y Montero at a glance Largest Engineering & Construction company in Peru measured by revenues 83 years of recognized operational excellence and significant international experience Undisputed reputation, reliability and highest corporate governance standards Revenues of US$1,802 MM and EBITDA of US$ 193 MM in 2016 Backlog and recurrent business of US$ 3,830 MM as of December x revenues 3,803 engineers and over 30,000 employees Listed in the NYSE since July 2013 Shareholders December 2016 AFPs (*) 12.8% Others 14.9% Internal Shareholders Internal Shareholders 32.1% (*) Includes only AFPs holdings reported at CAVALI (Peruvian clearing house) GH Holding Group (Jose Graña, Chairman): 17.8% Bethel Enterprises Inc. (Carlos Montero, Director): 5.1% Byron Development (Mario Alvarado, Director and CEO): 3.4% Hernando Graña (Director): 2.4% ADSs Program 40.2% Other executives and former executives: 3.5% 3

4 Our Business Segments Largest E&C company in Peru Leading infrastructure concessionaire in Peru Largest apartment building developer in Peru Leader in infrastructure O&M and complementary services 2016 Revenues by business segment 2016 EBITDA by business segment 2016 Net Income by business segment Technical Services 16% Real Estate 7% Engineering & Engineering & Construction Construction 62% Real Estate 25% 23% Real Estate 20% Engineering & Construction 2% Infrastructure 15% Technical Services 15% Infrastructure 37% Technical Services 24% Infrastructure 55% US$ 1,802 MM US$ 193 MM US$ 2.6 MM (S/. 6,005 MM) (S/. 648 MM) (S/. 9 MM) 4

5 Engineering and Construction Main companies: GyM: Construction company, founded in 1933, comprised of three divisions: electromechanic Revenues and EBITDA construction, civil construction and building construction. (US$ in millions) Stracon GyM: GyM subsidiary since 2011, specialized in mining services. GMI: Engineering consulting firm since 1984 consisting in two different divisions: Supervision1,800 1,685 1,712 & Engineering and Geomatics. 1,600 1,457 Vial y Vives- DSD S.A.: E&C company formed from a merger between two Chilean 1,382 1,400 companies, Vial y Vives and DSD Construcciones y Montajes, which are companies we 1,200 acquired in 2012 and 2013, respectively. 1, Morelco S.A.: Colombian company acquired in 2014, specialized in electromechanical 1,110 assemblies, civil works, and services for the oil and gas industry as well as energy industry Relevant Facts: Awarding of a contract for US$ 135 million for the construction of 14 schools in Colombia 200 GyM obtained the construction contract for the extension of Line 1 of Lima Metro for US$ million Morelco was awarded the Buena Pro of a contract for US$ 149 million, for the execution of the Regional Transmission System located in the Colombian Atlantic Coast Revenues EBITDA

6 Infrastructure Main companies: Norvial: Concessionaire of Red Vial 5 Highway Survial: Concessionaire of 1st Tranche of the Interoceanic Highway Concesión Canchaque: Concessionaire of the Bs As-Canchaque Highway Revenues and EBITDA (US$ in millions) Concesionaria La Chira: Concession for the construction, operation and maintenance of a waste water treatment plant for Lima Ferrovías GyM: Concessionaire of Line 1 of the Lima Metro GMP: Oil production (Blocks I, III, IV and V), gas processing plant and operation of ten fuel terminals in Peru Concesionaria Via Expresa Sur: Concession to build, maintain, and operate a 4.6km extension of one of the main highways in Lima COGA: Company responsible for the operation and maintenance of the transportation system of Transpotadora de Gas del Perú (TgP) Chavimochic: Concession to build the water infrastructure of the third stage of the Project Relevant Facts: GyM Ferrovías signed an addendum to the Concession Contract for the extension of Line 1 of Lima Metro for US$ 410 million Revenues EBITDA 0 6

7 Real Estate Main companies: Viva GyM: Real estate development company Almonte: Subsidiary of Viva GyM and owner of a 800 Ha. of undeveloped land, located 30 Kms to the south of Lima (Lurín) Affordable Housing Projects under execution: Parques del Callao, Parque Comas Parques de Piura, Nuevo Chimbote, Parques de Huancayo (Provinces) Housing Projects under execution: El Nuevo Rancho and Klimt (San Isidro) Commercial Real Estate projects under execution: Real Dos, Panorama (offices) Revenues and EBITDA (US$ in millions) Revenues EBITDA Units delivered 1,368 1, Units sold 2,017 1, ,

8 Technical Services Main companies: GMD: Provider of IT services and business solutions through four divisions: (i) Systems Integration, (ii) IT Outsourcing, (iii) Application Outsourcing, (iv) Business Processes Outsourcing. (US$ in millions) Concar: Operation and maintenance of infrastructure assets. It currently operates more than 5,000km of Peruvian roads and highways, including three private concessions, in addition to the Lima Metro CAM: Provides field and specialized electrical services in Chile as well as in Brazil, Colombia, 400 and Peru. 350 Adexus: Provider of IT services with presence in Peru, Ecuador, Argentina and Colombia Revenues and EBITDA Relevant Facts: Concar was awarded two contracts for the service management and road maintenance in the highlands of Peru for US$ 99.6 million with Provias Nacional 0 CAM Colombia obtained a contract for the client Electricaribe for US$ 63 million in January CAM obtained a contract for services of comprehensive operations for Edelnor for US$ 48 million Revenues EBITDA

9 Financial Performance Financial Performance Corporate Presentation 9

10 Consolidated Results (US$ in millions) Consolidated Revenues Consolidated Net Profit (US$ in millions) (US$ in millions) 2, , , ,000 2,051 2,134 2,345 2,295 1, Consolidated EBITDA 400 (US$ in millions) 25% Consolidated Margins % over Total Revenues % 15% 10% 5% 0% 17.3% 15.3% 16.8% 13.1% 13.6% 10.7% 13.6% 10.0% 10.6% 5.5% 5.4% 4.3% 9.0% 1.1% 0.1% Net Margin Gross Margin EBITDA Margin 10

11 Investments Investments (US$ in thousand) Investments by Business Area 2016 As a percentage Engineering & Construction 14% 352, , , , ,324 Holding 54% Infrastructure 18% Real Estate 6.4% Technical Services 8% (US$ in thousands) Engineering & Construction 163,503 73, ,245 36,393 32,157 Infrastructure 118, ,198 75,879 72,476 42,100 Real Estate 50,298 27,075 39,961 12,120 14,794 Technical Services 15,593 13,403 40,441 19,314 17,720 Holding 4,564 9,686 66, , ,553 Total 352, , , , ,324 11

12 Financial Debt Maturity of Gross Debt 2016 (US$ in thousand) Less than Between 1 Between 2 More than 1 year and 2 years and 5 years 5 years Total Other loans 996, , ,983-1,699,188 Leasing 117,302 80,878 25,127 16, ,163 Ferrovías & Norvial Bond Issue 46,091 37,343 83, , ,714 Total debt S/. 1,159, , , ,276 2,907,065 Total debt US$ 345, , , , ,198 Debt by Business Area 2016 Debt by Currency 2016 Holding 17% Engineering & Construction 28% Chilean Peso 6% Colombian Peso 2% Real Estate 8% US Dollars 38% Sol 54% Infrastructure 39% Technical Services 8% 12

13 Composition of Indebtedness Financial Debt (US$ thousands) 1Q2015 2Q2015 3Q2015 4Q2015 1Q2016 2Q2016 3Q2016 4Q2016 Working Capital + Leasing 398, , , , , , , ,938 Project Finance 297, , , , , , , ,439 GSP Contribution Financing , , , , ,821 Total 695,729 EBITDA 758,184 - LTM 832, , , , , ,198 EBITDA - LTM (US$ thousands) 1Q2015 2Q2015 3Q2015 4Q2015 1Q2016 2Q2016 3Q2016 4Q2016 E&C + Real Estate + Technical Services 182, , , , , , , ,875 Infrastructure 95,020 96,992 95,521 87,210 91,556 82,567 82,291 80,868 Total 277, , , , , , , ,744 Ratios 1Q2015 2Q2015 3Q2015 4Q2015 1Q2016 2Q2016 3Q2016 4Q2016 Debt/Ebitda (E&C + Real Estate + Technical Services) Debt/Ebitda (Infrastructure) Consolidated Debt/Ebitda

14 Backlog and Recurrent Businesses Total Backlog + Recurrent Businesses By segments MM 3.00 Technical Services 22% MM MM US$ 404 MM 2.25 US$ 394 MM 2.03 US$ 580 MM 1.85 US$ 448 MM 1.95 US$ 693 MM Real Estate 2% Infrastructure 25% Engineering & Construction 50% By type of contract (Only E&C) MM MM US$ 4,170 MM US$ 3,935 MM US$ 3,765 MM US$ 4,038 MM US$ 3,137 MM** 1.00 Unit Price 22% Cost plus Fee 44% Lump Sum 17% MM Backlog Recurrent Businesses Backlog + Rec. Businesses/ Revenues Ratio ** Backlog 2016 total amount doesn t include Gasoducto del Sur Project EPC 17% 14

15 Backlog and Recurrent Businesses By type of client By end-market 11% 25% 5% 14% 81% 64% Private Public Concessions 24% 9% 7% 3% 9% 3% 5% 4% 1% 14% 4% 12% 36% 26% 21% 22% Mining Projects Mining Services Oil and Gas Electricity Water and Sewage Real Estate Transport Others Construction/Non-Construction By country 29% 43% Non-Construction 10% 13% 1% 9% 3% 7% Peru Chile Colombia 57% Construction Others (Panamá, Bolivia, etc.) 71% 81% 76% Note: Outer circle corresponds to December 2016 data, whilst inner circle corresponds to December 2015 data 15

16 Backlog and Recurrent Businesses (US$ in thousands) Company Initial Executed New Requests Annual Backlog Backlog Backlog Backlog TOTAL 1Q Q Q Q GyM 1,734, , ,528 48, , , , , , ,180 82,788 Stracon GyM 1,147, ,761 36,169 7,110 11,873 11,901 5, , , , ,334 VyV-DSD 37,831 53,743 61,585 7,932-2,515 63,741-7,573 45,673 45, Morelco 163,804 96, , ,089 58,959-23, ,871 67,300 81,275 51,295 CAM Perú 11,362 16,170 5,305 3,871 1, GMI 34,261 36,700 59,777 5,301 13,453 8,811 32,212 57,338 32,724 24,614 0 Engineering & Construction 3,129,431 1,092,132-59,404 73, , , ,449 1,977, , , ,427 Survial 24,205 8,853 25,466 2,263 2,134 2,112 18,957 40,819 22,501 9,022 9,296 Canchaque 15,227 2,590 3, ,022 16,317 10,367 2,950 3,000 La Chira 5,308 5,494 3,071-1,197 3, , Línea 1 Metro de Lima 211,758 73, ,461-4,164 23,112 9,581 73, ,696 61,954 79,261 99,481 Infrastructure 256,498 90, ,679-2,412 29,018 12,928 95, ,716 95,755 92, ,767 Viva GyM 111, , ,290 45,160 18,412 11,359 32,358 95,852 88,118 6,433 1,300 Real Estate 111, , ,290 45,160 18,412 11,359 32,358 95,852 88,118 6,433 1,300 GMD 119,427 88,673 94,978 24,433 20,204 22,086 28, ,732 62,877 36,439 26,415 Adexus 0 33, , ,970 24,576 72,604 34,922 18,852 18,830 Concar 128,742 78, , ,193 7,324 6,216 36, ,243 97,030 51,160 70,054 CAM Perú 364, , , ,500 12,813 51,754 60, , , , ,843 Technical Services 613, , , ,126 40, , , , , , ,142 Eliminations -72,196-48,367-71,049-36,693 3,329 2,632-40,317-94,878-32,354-31,576-30,948 Total 4,037,807 1,679, , , , , ,677 3,137,376 1,391, , ,688 Recurrent Businesses GMP 327, , ,163 18,586 55,699 29, , , , , ,972 Norvial 147,274 64, ,716 46,609 11,107 51,818 51, ,627 71,977 91,261 80,388 Eliminations -26,117-54,973-54,169-10, ,806-23,260-25,313-8,438-8,438-8,438 Total 448, , ,710 54,538 66,362 61, , , , , ,923 Total Backlog + Recurrent Businesses 4,486,044 1,802,169 1,146, , , , ,237 3,830,180 1,594,531 1,080,038 1,155,611 16

17 Jan-13 Feb-13 Mar-13 Apr-13 May-13 Jun-13 Jul-13 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14 Apr-14 May-14 Jun-14 Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14 Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15 Jul-15 Aug-15 Sep-15 Oct-15 Nov-15 Dec-15 Jan-16 Feb-16 Mar-16 Apr-16 May-16 Jun-16 Jul-16 Aug-16 Sep-16 Oct-16 Nov-16 Dec-16 Jan-17 Feb-17 Stock Performance GRAM- February 08, 2017 ADSs (million) Market Cap (US$ MM) VWAP (3M) (US$) week high (US$) week low (US$) 3.51 Average daily traded volume (3M) (US$ MM) 1.4 GRAMON February 08, 2017 Shares (million) Market Cap (S/. MM) 2,019.8 VWAP (3M) (S/.) week high (S/.) week low (S/.) 2.48 Average daily traded volume (3M) (S/. MM) 1.6 S/ S/ S/ S/ S/ S/ S/ S/ S/ S/ S/ S/ S/ S/ Market Cap (max) 04nov13: GRAM: US$ 2,895 MM GRAMON: S/. 8,119 MM Market Cap (min) 26jan16: GRAM: US$ 290 MM GRAMON: S/. 1,056 MM Closing Price 08feb17: GRAM: US$ 4.68 GRAMON: S/ $22.00 $20.00 $18.00 $16.00 $14.00 $12.00 $10.00 $8.00 $6.00 $4.00 $2.00 $0.00 GRAMONC1 GRAM US 17

18 Unsaved Document / 12/11/2012 / 14:08 Appendix Appendix 15

19 Vision and strategic goals 1 Expand our Infrastructure businesses 2 Maintain and reinforce our position as the leading contractor for complex projects in Peru and other key markets 3 Continue growing by exporting our capabilities 4 Disciplined approach to capital 5 Continue fostering our corporate values throughout the organization To be recognized as the most reliable engineering services and infrastructure group in Latin America 19

20 Corporate Structure 98.23% 67.0% 90.54% (1) 89.37% Construction services Toll-road concession Real Estate development IT services Contract mining services 87.59% Toll-road concession 99.9% 99.9% Land parcels 50.4% 99.6% Operation and maintenance of infrastructure assets 86.22% Toll-road concession 75.0% Engineering and Construction services in Chile Engineering services 89.40% 70.00% Engineering and Construction services for Oil&Gas industry in Colombia Mass transit system concession Water plant concession O&G production, gas processing & fuel storage 75.0% 50.0% 95.0% Electricity networks services IT services 52.0% Highway concession 100.0% Operation and maintenance of gas pipelines 51.0% (1) 38.97% of the share capital in Viva GyM is held by our subsidiary GyM. 20

21 Consolidated Results Income Statement (Thousands US$) Revenues 2,050,915 2,134,233 2,344,824 2,294,882 1,802,169 Gross Profit 279, , , , ,352 General Expenses (100,815) (129,396) (140,973) (121,119) (138,087) Other Operational Expenses 29,770 9,311 5,091 16,812 14,764 Other Expenses (127) (262) (27) (28) (209) Profit from sale of inv. in subsidiaries - 2,047 - (2,429) 9,035 Operating Profit 207, , ,448 99,157 75,855 Financial expenses (12,331) (15,451) (15,749) (16,362) (38,431) Participation in Associates Dividends Perceived ,004 17,881 5,158 (402) Exchange rate difference 8,281 (25,185) (14,815) (24,276) (2,722) Profit before income tax 204, , ,765 63,677 34,300 Income tax (60,594) (65,247) (48,911) (22,156) (12,972) Minority Interests (29,909) (32,980) (20,571) (15,692) (18,767) Net Profit 113, , ,282 25,829 2,561 Depreciation & Amortization 95,846 92,682 86,999 89,782 85,689 EBITDA 313, , , , ,744 Balance Sheet (Thousands of US$) Total Assets 1,957,125 2,257,824 2,586,116 2,632,817 2,836,569 Cash 305, , , , ,826 Financial Debt 331, , , , ,198 Total Equity 696,547 1,143,362 1,063, , ,958 Financial Keys Gross Margin 13.6% 16.8% 13.6% 9.0% 10.6% Operating Margin 10.1% 11.3% 7.8% 4.3% 4.2% Net Margin 5.5% 5.4% 4.3% 1.1% 0.1% EBITDA Margin 15.3% 17.3% 13.1% 10.0% 10.7% Financial Debt /EBITDA Financial Debt /Equity ROE 20.6% 12.9% 10.7% 2.8% 0.3% 21

22 Results by Business Area 2016 Statement of Income (Thousands of US$) Revenues 1,110, , , ,284 1,802,169 GROSS PROFIT 72,960 49,429 40,637 55, ,352 General Expenses (74,756) (11,539) (8,461) (32,539) (138,087) Other Operational Expenses 13,598 (387) 249 1,295 14,764 Other Expenses - (138) - - (209) Profit from the sale of investments ,035 OPERATIONAL INCOME 11,802 37,366 7, ,855 Financial Expenses (12,345) (3,454) (2,592) (8,103) (38,431) Dividends received Engineering & Construction Infrastructure Real Estate Technical Services Consolidated Participation in Associates 5, , (402) Exchange rate difference (2,119) 1,110 (853) 388 (2,722) PRETAX INCOME 2,571 35,508 31,019 15,254 34,300 Taxes (3,011) (10,029) (8,052) (5,907) (12,972) Minority Interests 990 (7,215) (16,388) (989) (18,767) NET INCOME ,263 6,579 7,819 2,561 EBITDA 55,945 80,868 49,603 40, ,744 Financial Ratios Gross Margin 6.6% 18.2% 33.2% 14.0% 10.6% Operating Margin 1.1% 13.8% 5.9% 0.1% 4.2% Net Margin 0.0% 6.7% 5.4% 2.0% 0.1% EBITDA Margin 5.0% 29.8% 40.5% 10.3% 10.7% Financial Debt 244, ,439 66,368 68, ,198 Financial Debt /EBITDA ROE 0.2% 8.8% 3.6% 9.4% 0.3% 22

23 Workforce Workforce December 2012 December 2013 December 2014 December 2015 March 2016 June 2016 September 2016 December 2016 Employees 11,399 13,109 15,841 14,706 14,752 17,385 17,239 17,591 Manual Laborers (1) 11,855 12,759 24,259 11,026 7,024 6,407 7,386 8,493 Joint Operations Employees (2) 4,973 7,301 6,662 3,317 2,635 2,477 3,511 1,995 Subcontracted (3) 4,452 4,758 5,257 3,857 5,911 5,527 4,423 4,434 Total 32,679 37,927 52,019 32,906 30,322 31,796 28,136 32,513 60,000 50,000 40,000 30,000 20,000 10,000 0 December 2012 December 2013 December 2014 December 2015 March 2016 June 2016 September 2016 December 2016 Employees Manual Laborers (1) Joint Operations Employees (2) Subcontracted (3) (1) The number of manual laborers, who form part of our network of approximately 40,000 manual laborers, varies in relation to the number and size of projects we have in process at any particular time. (2) Includes engineers, professionals, technical specialists and manual laborers employed by our joint operations. (3) Occasionally, we employ subcontractors for particular aspects of our projects, such as carpenters, specialists in elevator installation and specialists in glassworks. We are not dependent upon any particular subcontractor or group of subcontractors. (4) Morelco is included since June

24 Corporate Governance Internal Directors Independent Directors Graña y Montero (GRAMONC1) is listed in the Lima Stock Exchange since 1997 and in the NYSE since July 2013 (GRAM) GRAMONC1 is included in the Corporate Governance Index of the Lima Stock Exchange Board of Directors The Corporate CEO is a Board Member The Board Committees are integrated mainly by External Directors Subsidiaries have at least one (1) External Board Member within their Boards José Graña Miro Quesada Carlos Montero Graña Hernando Graña Acuña Mario Alvarado Pflucker Pedro Pablo Errazuriz Federico Cúneo de la Piedra Hugo Santa María Guzmán Mark Hoffmann Rosas Recognitions Member of the Companies Circle of the Latin American Corporate Governance Roundtable since October 2010 Winner of the Llave de la BVL in 2014, 2010 and 2009 Recognized by Euromoney as: Best managed Company in Latin America Overall Best managed Company in Peru Best Managed Company in the Construction & Cement Sector in Latin America Most transparent accounts 24

25 Disclaimer Forward-looking statements This presentation contains forward-looking statements. Forward-looking statements convey our current expectations or forecasts of future events. These statements involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements to differ materially from the forward-looking statements that we make. Forward-looking statements typically are identified by words or phrases such as may, will, expect, anticipate, aim, estimate, intend, project, plan, believe, potential, continue, is/are likely to, or other similar expressions. Any or all of our forward-looking statements in this presentation may turn out to be inaccurate. Our actual results could differ materially from those contained in forward-looking statements due to a number of factors, including, among others: global macroeconomic conditions, including commodity prices, and economic, political and social conditions in the markets in which we operate, particularly in Peru; major changes in Peruvian government policies at the national, regional or municipal levels, including in connection with infrastructure concessions, investments in infrastructure and affordable housing subsidies; social conflicts in Peru that disrupt infrastructure projects, particularly in the mining sector; interest rate fluctuations, inflation and devaluation or appreciation of the nuevo sol in relation to the U.S. dollar (or other currencies in which we receive revenue); our ability to continue to grow our operations, both in Peru and internationally; the level of capital investments and financings available for infrastructure projects of the types that we perform, both in the private and public sectors; competition in our markets, both from local and international companies; our ability to complete acquisitions on favorable terms or at all and to integrate acquired businesses and manage them effectively post-acquisition; performance under contracts, where a failure to meet schedules, cost estimates or performance targets on a timely basis could result in reduced profit margins or losses and impact our reputation; developments, some of which may be beyond our control, that affect our reputation in our markets, including a deterioration in our safety record; industry-specific operational risks, such as operator errors, mechanical failures and other accidents; availability and costs of energy, raw materials, equipment and labor; our ability to obtain financing on favorable terms; our ability to attract and retain qualified personnel; our ability to enter into joint operations, and rules involved in operating under joint operation or similar arrangements; our exposure to potential liability claims and contract disputes, including as a result of environmental damage alleged to have been caused by our operations; our and our clients compliance with environmental, health and safety laws and regulations, and changes in government policies and regulations in the countries in which we operate; negotiations of claims with our clients of cost and schedule variances and change orders on major projects; volatility in global prices of oil and gas; the cyclical nature of some of our business segments; limitations on our ability to operate our concessions profitably, including changes in traffic patterns, and limitations on our ability to obtain new concessions; our ability to accurately estimate the costs of our projects; changes in real estate market prices, customer demand, preference and purchasing power, and financing availability and terms; our ability to obtain zoning and other license requirements for our real estate development; changes in tax laws; natural disasters, severe weather or other events that may adversely impact our business; and certain other factors disclosed in our registration statement on Form F-1 on file with the SEC. The forward-looking statements in this presentation represent our expectations and forecasts as of the date of this presentation. Except as required by law, we undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, after the date of this presentation. In light of the risks and uncertainties described above, the future events and circumstances discussed in this presentation might not occur and are not guarantees of future performance. 25

26 Contacts: Mónica Miloslavich Chief Financial Officer (511) Samantha Ratcliffe Leiva Head of Investor Relations (511) Corporate Presentation