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SalfaCorp Presentation III Chile Equity One on One Conference – London, May 2013

SalfaCorp Presentation III Chile Equity One on One Conference – London, May 2013. www.salfacorp.com. 01 - Who We Are 02 - Industry Overview 03 - Our Business Units & Results 04 - Topics of Interest 05 – Final Comments . Contents. 01. Who We Are.

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SalfaCorp Presentation III Chile Equity One on One Conference – London, May 2013

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  1. SalfaCorp Presentation III Chile Equity One on One Conference – London, May 2013 www.salfacorp.com

  2. 01 - Who We Are 02 - Industry Overview 03 - Our Business Units & Results 04 - Topics of Interest 05 – Final Comments Contents

  3. 01 WhoWe Are

  4. A Company with vast experience in the engineering, construction and real estate sectors • More than 83 years of history and leadership • One of the most important conglomerates in Latin America • Growing international presence in markets with potential growth • Leading market position in Engineering & Construction SalfaIngeniería y Construcción S.A. (“ICSA”) • Well positioned in mining services • Specialized technologies • Long term & regional relationships with customers • Leading position in Real Estate Development  Aconcagua S.A. (“Aconcagua”) • Good Diversification by product and geographic location • Vertically integrated manufacture of houses • Long position in Land • Strong brand recognition and reputation • 30,000+ employees • Publicly traded since 2004; member of the IPSA Index (groups the 40 largest traded companies in Chile’s exchange)

  5. Our Shareholder Base • Listed company in the local stock market since 2004. • Free Float ~ 60% • Stock price has increased 270% since its IPO (2004) • Rating: BBB by Fitch Ratings (local) • Rating: BBB+ by Feller Rate and ICR (local)

  6. Timeline of Growth • Significant organic growth • Growth over the last 5 years through mergers and acquisitions in complementary businesses • International expansion: Peru, Colombia, Panama • 2012 focused on consolidating these acquisitions and generate synergies • Revenues increased 472% between 2004-2012 80% 100% Merger with 100% 100% 90% 66,7% Consolidation SALFA PERÚ DES&SAL 40% 80% 70% 100% DES&SAL 100% 100% 2011 2008 2006 2007 2004

  7. Among the main construction companies in Latam (USD million) Main E&C and Real Estate Companies in Chile Source: Bloomberg; Superintendencia de Valores y Seguros; company reports Revenues for Camargo Correa are as of Dec-2011.

  8. Operations in countries with good economic perspectives GDP as of Dec-2012 (USD Million) GDP Growth Forecast Source: International Monetary Fund as of Dec-2012 Source: International Monetary Fund as of Dec-2012 Operations in countries with low risk in the Region SalfaCorp SalfaCorp SalfaCorp SalfaCorp Source: Fitch Ratings; based on foreign debt

  9. 02 Industry Overview in Chile

  10. Markets where we operate: Engineering & Construction and Real Estate Evolution of GDP Construction (Chile) Monthly Construction Activity Index (Chile) • Chile’s GDP grew 5,6% in 2012, year over year. • Construction GDP grew by nearly 8% in 2012, year over year. • Construction activity correlated to GDP growth. (*) Source: Central Bank of Chile and CámaraChilena de la Construcción

  11. Markets where we operate: Engineering & Construction and Real Estate (Cont.) Growth of Construction Investments (Chile) * Construction Investments per Economic Sector (Chile) * US$ 110,888 million CAGR: 15.4% • Investments in Construction are concentrated in the Mining and Energy industries. (*) Source: CámaraChilena de la Construcción

  12. Markets where we operate: Engineering & Construction and Real Estate (Cont.) Household Sales in Santiago Market Share in Chile (USD million) (*) • Household sales and stock in Santiago represents more than 50% of the market nationwide. (*) Estimated market calculated as SalfaCorp’s consolidated revenues in Chile over Total Investment in Construction. Source: CámaraChilena de la Construcción

  13. 03 Our Business Units

  14. Strategic Drivers for each Business Unit SalfaIngeniería y Construcción S.A. (Engineering & Construction) Aconcagua S.A. (Real Estate) • Growth and Profitability • Focus on segments with potential demand growth: • Mining & Energy • Large Projects • Position in regional markets with potential growth • Commercial • Specialized Services with Value added and higher margins: • Underground Mining • Drilling & Blasting • Long term Contracts • Sustainability • Control of Risks & Procedures • Cost Control • Supporting Systems (SAP) • Development of Human Resources & Competencies • Growth and Profitability • Relevant Position nationwide • “Decommoditization” of Supply through Innovation • Different mechanisms of associations/partnerships • Integrated manufacturing units allows better control of supply chain • Commercial • Better understanding of final customer • Differentiation: lagoons, thermal efficiency, etc. • Segments of higher value: Housing and Offices • Taking Opportunities abroad… Gaining experience • Sustainability • Land bank for app. 10 of long term development. • Supporting Systems (SAP) • Development of Human Resources & Competencies

  15. 03.1 Engineering & Construction Business Unit: “ICSA”

  16. ICSA’s Business Structure Financial Summary SALFA INGENIERÍA Y CONSTRUCCIÓN S.A. CHILE PERU COLOMBIA PANAMA Assembly Works AssemblyWorks Assembly Works Civil Works Civil Works Underground Mining Industrial Maintenance Ground Movement Infrastructure Drilling & Blasting Ports Ports

  17. ICSA consolidating its international presence GDP: +10.6% Backlog: USD 24 m Revenues: USD 39 m GDP: +4.0% Backlog: USD 15 m Revenues: USD 2 m GDP: +6.2% Backlog: USD 87 m Revenues: USD 98 m GDP: +5.4% Backlog: USD 1.2 bn Revenues: USD 1.6 bn ICSA only consolidates entities in Peru. Figures of entities in Colombia and Panama of Dec-2012 represent 100% of their business

  18. Backlog ICSA – US$ 1,300 million • Backlog at Dec-2012 practically at the same level as of Dec-2011 (in USD), but mix has improved • Reduction of Backlog in Units with less value contribution Backlog per Line of Business Backlog of Contracted Projects (*) Estimado en base al tipo de cambio de cierre de cada período. • Near MM$412 (US$ 860m) of backlog to be executed during 2013; • Close to MM$200 (US$ 420m) for 2014 onwards. • Backlog of US$ 1,300 million reflects the strategy to reduce lines of business with lower margins and focus in more profitable projects and segments.

  19. ICSA – Breakdown of Revenues per Line of Business Revenues per Line of Business * (Dec-12) • Revenues with good diversification. • Assembly Works and Mining Services  drivers of growth. • Highly specialized lines of business with greater value contribution. (*) Mining Services include Earth Movement, Underground Mining and Drilling & Blasting. Construction includes Civil Works and Sothern Zone lines of business. International revenues include only subsidiaries abroad which consolidate (Peru)

  20. ICSA: Results as of Dec-12 (in CLP million) Revenues Gross Profit / Mg % CAGR: +7% CAGR: +19% 7.6% 8.5% 7.2% 10.3% EBITDA / Mg % Profit CAGR: -20% CAGR: +12% 5.3% 4.7% 6.3% 3.3%

  21. ICSA: Key Financial Ratios as of Dec-12 Liquidity Leverage Net Financial Leverage ROE

  22. ICSA: Some of our projects Marine Works; Port Expansion, Puerto de Lirquén Civil Works; CostaneraCenter Project, Cencosud Assembly Works; Acid plant; Ministro Hales Project Underground Mining; ADITS Construction, CODELCO

  23. 03.2 Real Estate Business Unit: “Aconcagua”

  24. Aconcagua’s Business Structure Financial Summary ACONCAGUA S.A. Home Building (Novatec S.A.) Real Estate (Inmobiliaria Aconcagua S.A.) Other Units (Newall, Vertical, Noval) International Division 100% Ownership Real Estate Development Real Estate Associations with Partners

  25. Growth in Pre-sales and Deliveries Deliveries Combined (2) UF millions Pre-sales Combined (1) UF millions (3) Δ+21% Dec-12 / Dec-11 Δ+32% Dec-12 / Dec-11 Includes pre-sales in Chile and abroad, from businesses which consolidate and do not consolidate. Miami represents app. UF 1 million Only includes projects of Inmobiliaria Aconcagua in Chile. 1UF = USD 48 as of Dec-2012. UF is local currency indexed to inflation; housing prices are denominated in this currency.

  26. Evolution & Seasonality of the Real Estate Business $ million • Seasonality marked during 4Q of each year • Account Receivables + Inventory correlated with ST debt  real estate cash cycle

  27. Breakdown of Revenues per Business Segment Revenues per Segment (Dec-12) • Revenues with good diversification. • Construction Revenues reaching a maturity level. • Good land sales, consistent with attractive conditions of the industry and the large land bank of Aconcagua.

  28. Land Revenues – Comparatives with the market • Good market conditions boosted sales of land during 2012 from all players of the industry. In the case of Aconcagua 2009-2012 • Taking advantage of the opportunities given the upside of the market. • 2012’s Margin del 2012 considers a higher cost of land sales as a result of the application of IFRS 3 – Business Combination. (*) Source: Superintendencia de Valores y Seguros; Companies’ Financial Statements

  29. Land Bank  Solid position for long term development By Geographic Zone • Aconcagua manages approximately 1,700 has. of land for future real estate developments. • Book value as of Dec-2012, reached $ 77 billion vs. a fair value of $ 116 billion as of the same date. • Current volume of land is an important element of Aconcagua’s strategy and strengthens its sustainability for the long term. • As part of its financial strategy, Aconcagua maintains control of its lands with options, agreements and ownership of land.

  30. Aconcagua: Results as of Dec-12 (in CLP million) Revenues Gross Profit / Margin % CAGR: +11% CAGR: +25% 11.2% 14.1% 18.7% 15.7% EBITDA / Margin % Profit 6.3% CAGR: +49% CAGR: +484% 6.9% 7.5% 3.7%

  31. Aconcagua: Key Financial Ratios as of Dec-12 Liquidity Leverage Net Financial Leverage ROE

  32. Aconcagua: Some of our projects Punta Águila Project, Metropolitan Region Live Costanera Building, Metropolitan Region Laguna del Mar Project, La Serena, 4th Region Deloitte Building, Metropolitan Building

  33. 03.3 SalfaCorp Consolidated Financials

  34. SalfaCorp: Balance Sheet as of Dec-2012

  35. SalfaCorp: P&L as of Dec-2012

  36. SalfaCorp: Consolidated Financials as of Dec-12 (in CLP million) Revenues Gross Profit / Mg +18% +9% 9,5% 8,7% EBITDA Profit +46% +46% 4,6% 5.6%

  37. SalfaCorp: Key Consolidated Ratios as of Dec-12 Liquidity Leverage Net Financial Leverage ROE

  38. 04 Topics of Interst

  39. Recent Events … Company is evaluating the division of SalfaCorp into two separate and publicly traded business units ICSA

  40. Division of SalfaCorp - Rationale • FOCUS • Profitability in each business • Higher management control of the business. Strategic & Operational. • Specialization in each business: • Management and Board of Directors. • Business Model. • TI systems to support management. • FINANCING • Different needs of financial resources. • Different capital structure • E&C less leveraged. • Real estate more working capital intensive and higher leveraged in order to be profitable. • Different groups of investors. • GROWTH • Both Business Units are in a stage of growth. • They have reached such an operational scale in order to operate independently. • Different business strategies, thus Investment Plans. • Each company could capitalize growth opportunities in a better approach. • Aconcagua has its own Construction unit (Novatec) in the Real Estate business since 2 years ago • Operating synergies between Real Estate and Novatec have already been achieved. • Management is currently working as two independent companies • There are two Executive Vice-presidents in charge of these companies • Each structure operates independently • There are no synergy losses • The cost of this division is not significant

  41. 05 Final Comments

  42. Final Comments • SalfaCorp, a company with a leading position in the Engineering & Construction and Real Estate sectors in Chile. • Both Business Units have a diversified source of revenues. • In a good position for year 2013 and those to come. • ICSA: • Focus on Profitability  lines of business with better margins – Assembly Works and Mining Services. Reduction of lines with lower returns. • Good Backlog  Longer contracts and more focused. • Positioned to continue international growth • Aconcagua: • Differentiation Strategy successfully continues its course. • Solid land bank position for long term development. • Good Backlog  value added projects.

  43. SalfaCorp Presentation III Chile Equity One on One Conference – London, May 2013 www.salfacorp.com

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