RIPLEY CORP. September 2008

Transcription

1 RIPLEY CORP September 2008

2 Ripley Corp 1. Ripley Today 2. Chile: increasing profitability 3. Peru: leadership on a high growth market 4. Mexico: the implementation 5. Conclusion

3 Ripley Today current operations Department stores 50 stores in Chile and Peru selling space: 323,064 sqm Financial Retail Chilean credit card loans: US$ 929 m Banco Ripley Peru loans: US$ 310 m Banco Ripley Chile loans: US$ 461 m Real Estate ownership in 7 malls weighted average leasing space: 101,211 sqm owned stores: 20 Figures as of June 2008

4 Ripley Today 52 years of history Banco Ripley Chile 2008 Ripley Punta Arenas Ripley Alameda Banco Ripley Peru Ripley Corp Bond issuance in Peru San Diego First Department Store in Santiago Credit business starts Barros Arana First Department Store outside Santiago Alto Las Condes Insurance brokerage business starts Ripley Jockey Plaza First Department Store in Peru 2005 Ripley Corp: IPO 2007 Mexico: JV with Palacio de Hierro Peru: JV with Mall Plaza Ripley Trujillo: first store outside Lima Chile: Lease contract 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

5 Ripley Today shareholders structure Free Float 19.0% Pension Funds 19.8% Others 53.7% International Investors 19.0% Calderon Group 81.0% Mutual Funds 3.9% Insurance Co 3.6% Source: Ripley. Figures as of September 1st 2008

6 Ripley Today department stores CHILE 40 stores Revenues LTM: US$ 988 m Market share: 24,1% Selling space: 228,086 sqm Ripley 24.1% La Polar 12.9% Falabella 37.9% PERU 10 stores Revenues LTM: US$ 399 m Market share: 47% Selling space: 94,978 sqm Paris 25.0% Ripley 47.0% Falabella 53.0% Source: Ripley LTM Revenues and market share as of June 2008 Selling space as of August 2008.

7 Ripley Today financial retail CHILE Tarjeta Ripley: Loans: US$ 929 m Revenues LTM Jun 08: US$ 382 m Provisions/loans: 9.9% Banco Ripley Chile Loans: US$ 461 m 48 branches PERU Banco Ripley Peru Loans: US$ 310 m Revenues LTM Jun 08: US$ 134 m Provisions/loans: 6.7% 11 branches Source: Ripley Figures as of June 2008.

8 Ripley Today real estate business Ownership in 7 Shopping malls 101,211 sqm weighted average selling space Fully owned malls revenues LTM Jun 08: US$ 16 m Peru: Joint venture with Mall Plaza (20%) and Falabella (40%), to build, operate and manage shopping malls Chile: o The first one opened in Trujillo on December Ripley has an option to buy 22.5% in 3 shopping malls of Mall Plaza. Source: Ripley

9 Ripley Today revenues breakdown Ripley Corp revenues US$ 1,785 m (LTM as of June 08) Peru 22% Chile 78% Source: Ripley LTM: Last Twelve Months

10 Ripley Today Recent developments Deconsolidation of financial statements of Banco Ripley Peru and reclassification of charges for provisions and write offs Ripley Corp Consolidated Dec 06 Dec 07 Jun 08 (MU$ of each period) Before Proforma Before Proforma Proforma Revenues 1, , , , Costs of sales , , SGAs Operating Result Result on investment in related companies Net Income EBITDA EBITDA Margin 12.0% 11.9% 9.9% 8.9% 10.0% Ripley Corp Consolidated Dec 06 Dec 07 Jun 08 (MU$ of each period) Before Proforma Before Proforma Proforma Loan Stock Investment in related companies Debt Equity , , ,199.3 Source: Ripley BRP: Banco Ripley Perú 6

11 Ripley Today Recent developments Ripley Corp first bond issuance in Peru: August 7th S./ (US$39 MM) 9 years bullet 8.56% Rated AAA by Equilibrium (local Credit Risk Agency) The lowest spread of last comparable issuances: 0.81% over Peruvian Government Bond US$125 million in 3 new medium term bank loans (2 years bullet) Chilean credit risk confirmation by Humphreys and Feller Rate for Ripley Corp (A+) and Ripley Chile (AA ), stable outlook 8

12 Ripley Corp 1. Ripley Today 2. Chile: increasing profitability 3. Peru: leadership on high a growth market 4. Mexico: the implementation 5. Conclusions

13 Ripley Chile: increasing profitability Selective square meter increase to follow market growth New management structure New distribution center start up Loans portfolio and controlled risk Growth on real estate business through Mall Plaza Ripley Chile results

14 Ripley Chile: increasing profitability Selective square meter 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 Ripley Chile: increasing profitability Selective square meter increase to follow market growth New management structure New distribution center start up Loans portfolio and controlled risk Growth on real estate business through Mall Plaza Ripley Chile results

16 Ripley Chile: increasing profitability New management structure Current Andrés Roccatagliata CEO Commercial sfinancial Products Channels and Services Marketing Risk Operations & Technology Logistics Before CEO Retail Division Financial Business Division Corporate Services

17 Ripley Chile: increasing profitability Selective square meter increase to follow market growth New management structure New distribution center start up Loans portfolio and controlled risk Growth on real estate business through Mall Plaza Ripley Chile results

18 Ripley Chile: increasing profitability New distribution center start up

19 Ripley Chile: increasing profitability Selective square meter increase to follow market growth New management structure New distribution center start up Loans portfolio and controlled risk Growth on real estate business through Mall Plaza Ripley Chile results

20 Ripley Chile: increasing profitability Loans portfolio & Controlled risk 7.6% 7.7% 9.9% 20.6% 29.8% Jun 06 Jun 07 Jun 08 Loans (MU$ Jun 08) Provisions/ Loans Source: Ripley Figures in nominal terms

21 Ripley Chile: increasing profitability Loans portfolio & Controlled risk Sixth player in Chilean consumer loan financial market Itau Chile 2.8% December 2007 Others 10.9% Santander 20.6% Cencosud 4.9% BBVA 4.3% Corpbanca 5.1% Chile+Citi 16.8% Ripley + Banco Ripley Chile 6.1% Figures as of December 2007 BCI 8.9% Source: Ripley based on SBIF data, Banks and more Department Stores are included Estado 8.9% Falabella+CMR 10.8%

22 Ripley Chile: increasing profitability Loans portfolio and controlled risk Risk model management Step 1 Initial credit scoring Step 2 First loans: Only for purchases in the store Step 3 Behavior scoring: CRM/ risk/ profit Step 4 Additional credit products (cash, term loans, associated commerce): Only to known costumer profiles COLLECTIONS Segmented, massive and with an appropriate technology

23 Ripley Chile: increasing profitability Selective square meter increase to follow market growth New management structure New distribution center start up Loans portfolio and controlled risk Growth on real estate business through Mall Plaza Ripley Chile results

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 companies. Due date 2010 Ripley Corp S.A hired Citibank and Banchile to start a selling process for its shopping malls business in Chile. Shopping Mall Leasing Space % Ownership Ripley Panoramico 5, % Mall del Centro 18, % Mall del Centro Rancagua 13, % Calama 44,206 25% Marina Arauco 57,968 33% Mall del Centro Curico 45,911 33% Mall Concepcion (Under construction) 90, %

25 Ripley Chile: increasing profitability Selective square meter increase to follow market growth New management structure New distribution center start up Loans portfolio and controlled risk Growth on real estate business through Mall Plaza Ripley Chile results

26 Ripley Chile: increasing profitability EBITDA, Operating margin & result 7.0% 7.6% % 69.5 MUS$ % S S 2008 Operating Margin Operating Result EBITDA Source: Ripley

27 Ripley Corp 1. Ripley Today 2. Chile: increasing profitability 3. Peru: leadership on high growth market 4. Mexico: the implementation 5. Conclusions

28 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 Aventura Plaza

29 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 Peru

30 Ripley Peru: leadership on high growth market Macroeconomic environment...there is a lack of department stores... department sqm / 1000 inhabitants Peru Chile USA Source: Ripley, Banco Central del Peru, US Census Figures as of dec 2002

31 Ripley Peru: leadership on high growth market Macroeconomic environment Annual department store sales per Capita (US$) Peru Chile USA Figures as of April 2007

32 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 Aventura Plaza

33 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 Figures as of June 08 Ripley has the best preference level among retailers June 07 Others 15% June 08 Others 4% Falabella 32% Ripley 43% Falabella 33% Ripley 48% Source: Inmark Peru Max: Ripley Store but focused in a lower level Max (Ripley) 10% Max (Ripley) 15%

34 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 Aventura Plaza

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

36 Ripley Peru: leadership on high growth market Important store opening plan Same Store Sales increases (nominal variation in nuevos soles) 18.7% 10.5% 13.4% 14.1% 8.3% 3.8% Mar 07 Jun 07 Sep 07 Dec 07 Mar 08 Jun 08 Source: Press Release 2Q 08 of Ripley Corp

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 Aventura Plaza

38 Ripley Peru: leadership on high growth market Growth on loans portfolio with Banco Ripley Peru 4.7% 5.6% 6.7% 38.4% % Jun 06 Jun 07 Jun 08 Loans (MU$ Jun 08) Provisions/ Loans Source: Ripley

39 Ripley Peru: leadership on high growth market Growth on loans portfolio with Banco Ripley Peru Sixth player in Peruvian consumer loans market July 2008 Others 13.6% BCP 19.6% Citibank 5.1% Banco Ripley Peru 5.9% Interbank 18.3% Falabella Peru 7% Scotiabank Peru 15.4% Continental 15.5%

40 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 Aventura Plaza

41 Ripley Peru: leadership on high growth market Growth on real estate business with Aventura Plaza Association with Mall Plaza (20%) and Falabella (40%) for the construction and operation of shopping malls in Peru. One shopping in Trujillo One shopping under construction in Callao Three other incoming projects: Santa Anita, Primavera and Arequipa. Ripley 40% Falabella 40% Mall Plaza 20% Aventura Plaza Opening of Trujillo Store

42 Ripley Corp 1. Ripley Today 2. Chile: increasing profitability 3. Peru: leadership on a high growth market 4. Mexico: the implementation 5. Conclusion

43 Mexico: the implementation Interesting opportunity in medium/low income segment Grupo Bal: an excellent local partner Advances in the business plan

44 Mexico: the implementation Interesting opportunity in medium/low income segment RETAIL REVENUES COMPOSITION (Billon US$) 142,3 111,8 37% 78% 63% 22% Non Food Food Formal retail Traditional Source: Planet Retail as of Dec 2006

45 Mexico: the implementation Interesting opportunity in medium/low income segment 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 Source: Ripley *Data based on Financial Statements of Coopel, Liverpool, Elektra, Famsa.

46 Mexico: the implementation Interesting opportunity in medium/low income segment Grupo Bal: an excellent local partner Advances in the business plan

47 Mexico: the implementation Grupo Bal: an excellent local partner Grupo Bal is one of the 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 Palacio de Hierro: Is the most exclusive and prestigious department store in Mexico o Peñoles: Is the world leading company in production of Silver. Its Market Cap is estimated in about US$ 12,000 million o 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.

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

49 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: planned for 2009

50 Ripley Corp 1. Ripley Today 2. Chile: increasing profitability 3. Peru: leadership on a high growth market 4. Mexico: the implementation 5. Conclusion

51 Conclusions Chile: increasing profitability Selective square meter increase to follow market growth New management structure New distribution center start up Loans portfolio & Controlled risk 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 Aventura Plaza Mexico: The implementation First store openings: 2009

52 RIPLEY CORP September 2008