Ripley Corp. August nd Quarter 2017 Results

Transcription

1 Ripley Corp August nd Quarter 2017 Results

2 LIST OF CONTENTS 1. Ripley Corp s first semester results summary 2. highlights 3. Ripley Corp s results summary 4. Ripley Retail 5. Ripley Bank 6. Real Estate 7. Looking forward

3 RIPLEY CORP S 6M17 RESULTS SUMMARY Net income reached MM$24,362, a 36.2% higher than the one obtained in 6M16 Income before taxes reached MM$28,648, growing MM$15,081 from the previous year Positive EBIT evolution (+46.3%) Semester s revenues increased 6.0% Higher same stores sales ( SSS ) in Chile (+7.3%) Financial revenues grew 5.0% Consolidation of Mall Aventura S.A. ( Aventura ) Efficiencies in expenses in Ripley Chile EBITDA rose 12.1% up to MM$69,842 RIPLEY CORP Accumulated (amounts in CLPMM$) 6M17 6M16 Var % Total revenues 790, , % Gross profit 291, , % SG&A (264,908) (257,173) 3.0% EBIT 26,652 18, % Income/loss before taxes 28,648 13, % Income/loss from continued operations 24,189 17, % income/loss from discontinued operations 173 (30) Net income 24,362 17, % EBITDA 69,842 62, %

4 REPORT HIGHLIGHTS Ripley Peru Bank carried out two financial instruments issuances during the quarter. NCDs: S/ 50 million up to a year CBs: S/ 50 million up to 2.5 years Additionally on June 27 th 2017, Ripley Bank in Peru distributed S/30 million of dividends to its parent company, for the concept of accumulated earnings from 2016 Peru s online channel received, for a second consecutive year, the ecommerce Award to the Leader of ecommerce in Retail During the first quarter of 2017, Mall Aventura sold a land located in Los Olivos, Lima Sale for an amount of MM$27,541 Land available for sale with no project associated to it Income before taxes reached MM$3,904 over the fair value registered During the month of July began the construction of the expansion of Mall Arequipa in Peru This project will add 7,000 m 2 of GLA of the mall Additional revenues estimated for the tenants of S/ 66 million Its opening is contemplated for the last quarter of 2017

5 RIPLEY CORP S RESULTS SUMMARY Net income reached MM$18,230, a 54.9% higher than in Income before taxes reached MM$20,644, growing MM$8,403 (+68.6%) from the previous year Positive EBIT evolution (+19.0%) Higher same stores sales ( SSS ) in Chile (+5.1%) Improvement in sales and margins in retail in Chile Consolidation of Mall Aventura S.A. Efficiencies in expenses in Ripley Chile EBITDA rose 5.2% up to MM$38,625 RIPLEY CORP Quarter (amounts in CLPMM$) Var % Total revenues 415, , % Gross profit 153, , % SG&A (137,184) (131,348) 4.4% EBIT 16,673 14, % Income/loss before taxes 20,644 12, % Income/loss from continued operations 17,879 12, % income/loss from discontinued operations 352 (1,187) Net income 18,230 11, % EBITDA 38,625 36, %

6 2 nd QUARTER 2017 RESULTS RIPLEY CHILE RETAIL BUSINESS REVENUES: increased 5.8% (+5.1% SSS) Rise in the apparel departments e-commerce sales focused on hard goods Cyberday at the end of May 2017 Revenues (MMMCLP) Gross Profit (MMMCLP) 197,3 186,5 +5.8% GROSS MARGIN: Gross Margin/sales increased Better performance of soft goods Better mix of soft/hard goods Larger contribution of commercial discount from Ripley Bank EBIT (MMMCLP) 58,6 62,5 +6.7% EBIT: increased MM$4,274 in 4,0 EBITDA: increased up to MM$7,826 in SG&A decreased 0.6% Stable direct SG&A 180 bps increase in EBITDA margin -0,2 EBITDA (MMMCLP) 7,8 4,1 N/A +89.8% Amounts in MMCLP

7 2 nd QUARTER 2017 RESULTS RIPLEY PERU RETAIL BUSINESS Revenues (MMMCLP) REVENUES: increased 4.6% in Chilean pesos 4.9% increase measured in Peruvian currency (+0.6 % SSS), shows an important change in tendency from 1Q17 Consumption impacted by a less dynamic economy and still affected by El Niño phenomenon in 1Q17 GROSS MARGIN: gross margin/sales decreased Higher level of discounts due to over stock of inventory by the end of 1Q bps improvement against 1Q17 shows an upturn Stable contribution by commercial discount from Ripley Bank EBIT: decreased MM$1,667 Gross Profit (MMMCLP) 28,1 27,4 EBIT (MMMCLP) -0,1 1,5 102,2 106,9 4.6% 2.6% N/A EBITDA: reached MM$2,927, lower amount than in SG&A increased 9.2% Two additional stores opened in 2016 (August and December) EBITDA (MMMCLP) 2,9 4,3-31.3% Amounts in MMCLP

8 2 nd QUARTER 2017 RESULTS RIPLEY CHILE FINANCIAL BUSINESS Revenues (MMMCLP) REVENUES: increased 3.7% Loan portfolio grew 6.2% OPERATIONAL COSTS: rose 23.9% Funding costs decreased 13.2% Net risk cost increased 44.7%, however, eliminating the effects of contingents and additional provisions, the net risk cost would have increased 17.4% (by the increase in the loan portfolio and greater risk in the banking system) NET INCOME: decreased 20.0% to MM$9,092 71,7 69,1 Net Income (MMMCLP) 9,1 11,4 Loan Portfolio (MMMCLP) +3.7% -20.0% 775,1 729,6 +6.2% (*) Note: under NIIF, the contingent and additional provisions constituted under SBIF norm in Chile and SBS norm in Peru, are reversed at a consolidated level in Central Offices & Consolidation Adjustments Amounts in MMCLP

9 RIPLEY CHILE FINANCIAL BUSINESS Healthy evolution of Early Non Performing Loans ( NPL s ) when compared to previous years 22% 20% 18% 16% 14% 2 nd QUARTER 2017 RESULTS Early NPL's (1-90 Days) Late NPL s show a slight increase which is in line with the behavior of the Chilean banking system during the first half of 2017 The Net Provision Expense even considering the new provisions model, is stable and in line with previous years. 6,0% NPL's 90 + Days 5,5% 5,0% 4,5% 4,0% 3,5% 1,6% Net Provision Expense (Does not consider contingent and prudential provisions) 1,1% 0,6% 0,1% (*) In October 2016, Ripley Bank Chile changed its risk provisions aligning its model to the BIF definitions Old provisions model 2017

10 2 nd QUARTER 2017 RESULTS RIPLEY PERU FINANCIAL BUSINESS Revenues (MMMCLP) REVENUES: increased 2.2% Loan portfolio grew 10.4% Difference between revenues increase and loan portfolio increase is due to: The decrease in revenues due to refinancing done with clients affected by the El Niño phenomenon Sale of written off loan portfolio in affects the base for comparison OPERATIONAL COSTS: Increase of net risk cost Deterioration in payment behavior of the Peruvian banking system Increase of alignment provisions 36,5 35,7 Net Income (MMMCLP) 2,3 2,8 Loan Portfolio (MMMCLP) +2.2% -17.7% NET INCOME: decreased 17.7% to MM$2,344 SG&A decreased 1.2% 335,8 370, % (*) Note: under NIIF, the contingent and additional provisions constituted under SBIF norm in Chile and SBS norm in Peru, are reversed at a consolidated level in central offices & consolidation adjustments Amounts in MMCLP

11 RIPLEY PERU FINANCIAL BUSINESS Early and late NPL s still maintaining healthy levels Rise in Net Provision Expenses in 2017 is explained: 1. By the deterioration in the payment behavior of the Peruvian banking system 2. By the increase of alignment provisions, which are based in behaviors with other banks and not only with Ripley Bank 17% 15% 13% 11% 9% 7% 6% 5% 4% 3% 2% 1% 2 nd QUARTER 2017 RESULTS Early NPL's (1-90 Days) NPL's 90 + days 1,2% 1,0% 0,8% 0,6% 0,4% 0,2% 0,0% Net Provision Expense

12 RIPLEY REAL ESTATE BUSINESS Mall Concepción: EBITDA increased 4.1% reaching MM$1,395 in Mall Aventura: EBITDA reached MM$2,091, considering the expense associated to the stake the employees hold over the tax income from the sale of a land Inmobiliaria Viña del Mar: EBITDA reached MM$3,068, amount slightly lower than the MM$3,148 obtained in Nuevos Desarrollos: EBITDA reached MM$2,132 in Mall Concepción y prop. en arriendo 2 nd QUARTER 2017 RESULTS Mall Aventura S.A. EBITDA (2) Inmob. Mall Viña del Mar S.A Nuevos Desarrollos S.A Non-consolidated operations Total Ownership Country Investment (1) (CLP MM) GLA (m 2 ) (1) Malls Mall Concepción 100% Chile 77,444 26,000 1 Inm. Mall Viña del Mar S.A. 50% Chile 105,571 58,500 2 Nuevos Desarrollos S.A. 22,5% Chile 123,839 76,605 6 Mall Aventura S.A. 100% Peru 180, ,900 2 Total 487, , (1) Amounts weighed by the percentage of Ripley s ownership (2)2016 EBITDA corresponds to 40% of Aventura Plaza S.A. Amounts in MMCLP

13 RETAIL BANK REAL ESTATE LOOKING FORWARD MAIN FOCUS MAIN SOURCE OF GROWTH & PROFITABILITY - Fashion & Brands - Increase Profitability Increase in margins through strategic plan focused on brands Strengthening ecommerce channel Increase in square meters and higher store maturity - Competitive Credit Card - New Core Banking System Migrate known clients to Mastercard Conservative growth leveraging on known clients Keep healthy leverage ratios Implement electronic accounts, debit cards and other bank services - Grow in Mall operations Greater maturity of existing malls, new malls under associates and expansion of existing owned malls Developing new projects Source: Ripley Corp s Dec-16 Financial Results

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