fy2016 results investor presentation -...

FY2016 ResultsInvestor Presentation

Cosco Capital, Inc.

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DISCLAIMER

These presentations and/or other documents have been written and presentedby COSCO CAPITAL, INC. (COSCO). COSCO is solely responsible for the accuracyand completeness of the contents of such presentations and/or otherdocuments. Third parties, other than COSCO, do not have any responsibility foror control over the contents of such presentations and/or other documents. Noendorsement is intended or implied notwithstanding the distribution of thispresentation and/or other documents during the analysts and investors calls andmeetings of COSCO. The materials and information in the presentations andother documents are for informational purposes only, and are not an offer orsolicitation for the purchase or sale of any securities or financial instruments orto provide any investment service or investment advice.

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Head Office Address2nd floor, Tabacalera Building, 900 Romualdez Street, Paco, Manila, 1007Philippines

Agenda

• Company Overview

• FY2016 Consolidated Financial Results

• Core Businesses• Grocery Retailing

• Liquor Distribution

• Specialty Retailing

• Commercial Real Estate

3

Company Overview

Corporate Structure

100% 100%

100%

90%

51%

• Ellimac Prime Holdings, Inc.,

• Fertuna Holdings Corp., • Patagonia Holdings

Corp., • Nation Realty, Inc.• NE Pacific Shopping

Centers Corporation• Pure Petroleum Corp.,

Lucio Co Family73%

Public27%

5

Grocery Retailing Liquor Distribution Specialty RetailingCommercial Real

Estate

Our Subsidiaries

Grocery Retailing Liquor Distribution

Puregold Price Club, Inc.• 2nd largest grocery retail chain in

the Philippines• Nationwide presence with 277

stores across the country

S&R Membership Shopping Club• Pioneer and dominant player in

membership club retailing• 12 warehouses and 23 Quick

Service Stores (“QSR”) nationwide

• Leading player in the premiumwine and liquor distributionindustry

• Covers 90% of imported wine andliquor in the Philippines

• Global brands such as Jose Cuervo,Alfonso, Johnnie Walker and otherwell-known imported names

Specialty Retailing Commercial Real Estate

Liquigaz Philippines Corporation• 2nd largest liquefied petroleum gas

(“LPG”) supplier in the Philippines

Office Warehouse, Inc.• Office and school supplies,

furniture and technology products• 71 retail outlets nationwide

• Commercial Real Estate portfolioincludes community malls,commercial buildings, land forlong-term lease

• 38 commercial properties located mostly in the Metro Manila area as well as in neighboring provinces of Luzon

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Company Milestones

2013 2014 2015

April 22: Approval by the Securities andExchange Commission (SEC) ofchange in corporate name andincrease in capital stock of Parentcompany.

May 31: Implementation of issuanceand listing of new shares, crosstrade at the Philippine StockExchange (PSE) of PGOLD shares tothe Parent company, issuance ofshares to the subscribers pursuantto share swap, special block sale atthe PSE of new shares.

February 3

• Puregold Price Club, Inc. acquired nine (9)supermarkets from NE Incorporated.

• Cosco Capital, Inc. through its wholly-owned subsidiary, Ellimac Prime Holdings,Inc., acquired four (4) commercialproperties from NE Incorporated

August 5: through wholly-owned subsidiary,Ellimac Prime Holdings, Inc. acquired RFCmall located along Alabang, Zapote, LasPinas City

August 6: Puregold Price Club, throughwholly-owned subsidiary Entenso Equitiesand Goldtempo Company, Inc., acquiredeight (8) supermarket stores operatingunder trade name Budgetlane

August 12: Cosco Capital, Inc. through itswholly-owned subsidiary, Ellimac PrimeHoldings, Inc., acquired Maunlad mallsituated at Malolos Bulacan

January 29: Approval of merger ofNation Realty, Inc., Go Fay & Co,Inc., SVF Corporation and 999Shopping Mall, Inc. (Nation Realty,Inc. as the absorbing entity).

February 28: Acquisition of NE PacificShopping Centers Corporation

May 1: Acquisition of OfficeWarehouse, Inc.

July 17: Acquisition and subscriptionof additional shares of CanariaHoldings Corporation.

July 21: Acquisition of LiquigazPhilippine Corporation throughCanaria Holdings Corporation

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FY2016 Consolidated Financial Results

FY2016 Consolidated Financial Highlights

(In PHP millions)

9

+10.7% +9.8%

+10.4% +7%

48,976

98,787 116,752

129,189

FY2013 FY2014 FY2015 FY2016

Revenues

9,534

17,287 19,964

21,912

FY2013 FY2014 FY2015 FY2016

Gross Profit

5,733

10,179 11,675

12,890

FY2013 FY2014 FY2015 FY2016

EBITDA

3,731

6,236 6,987 7,469

FY2013 FY2014 FY2015 FY2016

Net Income

Revenue Contribution

10

PHP 129.18 billion

Consolidated Revenues

PHP116.75 billion

FY2016 FY2015

Grocery Retailing

87%

Speciality Retailing

8%

Liquor Distribution

3%

Commercial Real Estate

2%

Grocery Retailing

83%

Speciality Retailing

11%

Liquor Distribution

4%


2%

Net Income Contribution

*attributable to equity holders of the parent company

PHP 4.49 billionPHP4.73 billion

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FY2016 FY2015

Grocery Retailing

59.5%

Speciality Retailing6.6%

Liquor Distribution

15.8%


22.2%

Head Office Expenses-4.2%

Grocery Retailing

56.8%

Speciality Retailing10.3%

Liquor Distribution

14.7%

Commercial Real Estate22.9%

Head Office Expenses-4.7%

FY2016 Consolidated Balance Sheet

12

(In PHP millions) 2016 2015Increase

(Decrease)%

Cash and cash equivalents 12,634 14,541 -1,907 -13%

Total Current Assets 29,399 24,958 4,441 18%

Total Non Current Assets 61,437 58,117 3,320 6%

TOTAL ASSETS 103,469 97,617 5,852 6%

Total Current Liabilities 19,672 19,041 631 3%

Total Non-current Liabilities 11,994 13,032 -1,038 -8%

TOTAL LIABILITIES 31,666 32,073 -407 -1%

TOTAL EQUITY 71,803 65,544 6,259 10%

Grocery Retailing: 9M2016 Financial Highlights

Key Highlights

• 15.9% growth in ConsolidatedNet Sales to PHP 112.58 billion,with Puregold contributing 81%and S&R 19% of total.

• Growth in Revenues driven byPuregold’s Same Store SalesGrowth (“SSSG”) of 6.2% due topositive growth in basket size of5.5% and traffic count of 0.6%.S&R posted SSSG of 4.4% due topositive growth in traffic of 2.4%and basket size of 2%.

• Consolidated Net Profit Marginof 4.9%. Puregold only netmargin is 4.4% while S&R netmargin is 9.4%.

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(In PHP millions)

+15.9%

+12.1%+10.5%

46,024

84,697 97,172

112,589

FY2013 FY2014 FY2015 FY2016

Revenues+12.4%

7,871

14,760 16,489

18,538

17.1% 17.4% 17.0% 16.5%5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

40.0%

-

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

18,000

20,000

FY2013 FY2014 FY2015 FY2016

Gross Profit

Gross Profit Gross Profit Margin

4,012

8,133 8,847 9,921

8.7% 9.6%9.1%

8.8%

3.0%

5.0%

7.0%

9.0%

11.0%

13.0%

15.0%

17.0%

19.0%

-

2,000

4,000

6,000

8,000

10,000

12,000

FY2013 FY2014 FY2015 FY2016

EBITDA

EBITDA EBITDA Margin

2,548

4,520 5,002

5,526

5.5% 5.3% 5.1% 4.9%2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

14.0%

-

1,000

2,000

3,000

4,000

5,000

6,000

FY2013 FY2014 FY2015 FY2016

Net Income

Net Income Net Income Margin

Grocery Retailing: Recent Developments

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• Puregold opened 26 new stores out of targeted 25 new storesand closed 4 Puregold stores

• S&R opened 2 S&R Warehouse and 10 S&R New York StylePizza (QSR)

• As of end 2016, the Grocery Retailing segment is operating atotal of 329 stores with consolidated NSA of more than486,700 sqms

PUREGOLD S&R S&R QSR NE BodegaBudgetlane

Metro Manila 110 5 14 0 1Luzon 150 3 7 9 7Visayas 9 2 1 0 0Mindanao 8 2 1 0 0Total 277 12 23 9 8

Liquor Distribution: Products

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TequilaJose Cuervo

WhiskeyBushmills

Chivas Regal

CognacMartel

VodkaAbsolut

LiqueursJagermeister

Specialty BeveragesRed Bull

Various Wines

BrandyFundador

Fundador Light

WhiskeyJim Beam

Glenfiddich

BrandyAlfonso

Alfonso LightExcelente

TequilaPatron

WhiskeyJohnnie Walker

Jack Daniels

Various Wines

Liquor Distribution: FY2016 Financial Highlights

16

(In PHP millions)

+4%

+1.6%

+3.4%

-11.9%

3,565

4,841 5,677 5,904

FY2013 FY2014 FY2015 FY2016

Revenues

1,003

1,188 1,299 1,344

28.1% 24.5% 22.9% 22.8%15.0%

20.0%

25.0%

30.0%

35.0%

40.0%

500

700

900

1,100

1,300

1,500

FY2013 FY2014 FY2015 FY2016

Gross Profit


• Revenues growth due to the 18%increase in volume of cases sold.

• Slight decline in GP Margin dueto higher cost of sales

• Net income declined due toincrease in operating expensesfor marketing and distributionexpenses

Key Highlights

731

838

919 934

20.5% 17.3% 16.2% 15.8%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

500

550

600

650

700

750

800

850

900

950

1,000

FY2013 FY2014 FY2015 FY2016

EBITDA


594 603 660

581

16.7%12.5% 11.6% 9.8%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

400

450

500

550

600

650

700

750

800

FY2013 FY2014 FY2015 FY2016

Net Income


Liquor Distribution: Total Volume Sales

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• 18% growth in total volume of cases sold • Growth mainly driven by Alfonso Light and Alfonso Solera

FY2016 % to total FY2015 % to total Inc (Dec) % Inc (Dec)

Brandy 1,147,091 62% 951,042 61% 196,049 21%

Other spirits 326,283 18% 306,487 20% 19,796 6%

Wines 216,790 12% 185,260 12% 31,530 17%

Specialty Beverages 145,538 8% 113,628 7% 31,910 28%

Total Volume (in cases) 1,835,702 100% 1,556,417 100% 279,285 18%

Liquigaz: FY2016 Financial Highlights

18

-24.7%

-23.6%-31.6%

(In PHP millions)

-20.4%

FY2014 FY2015 FY2016

Volume Sold (In metric tons) 432,995 423,151 393,990

18,956

11,854 8,927

FY2014 FY2015 FY2016

Revenues

Key Highlights

1,014 932 742

5.3%7.9% 8.3%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

14.0%

-

100

200

300

400

500

600

700

800

900

1,000

FY2014 FY2015 FY2016

Gross Profit


734 733 560

3.9%6.2% 6.3%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

14.0%

-

100

200

300

400

500

600

700

800

900

1,000

FY2014 FY2015 FY2016

EBITDA


279

399

273

1.5%3.4% 3.1%

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

7.0%

8.0%

-

50

100

150

200

250

300

350

400

450

500

FY2014 FY2015 FY2016

Net Income


• Decline in revenues due to lowglobal LPG price and 7% declinein total volume sold during theyear

• New terminal facility in Sairaya,Quezon to be completed in2H2017

Office Warehouse, Inc. FY2016 Financial Highlights

Key Highlights

19

+18% +17.7%

+22.1%

(In PHP millions)

+21.4%

2014 2015 2016

# of Stores 48 59 71

Net Selling Area 11,036 sqm 14,014 sqm

655

1,043 1,302

1,535

FY2013 FY2014 FY2015 FY2016

Revenues

• Opened 12 new stores forFY2016

• Sales grew by 18% to PHP1.5billion, driven by SSSG of 9%

• Positive results is due to storenetwork expansion, enhancedproduct offerings, and activesales and marketing campaigns.

118

268

354

417

18.0%25.7%

27.2% 27.2%

15.0%

20.0%

25.0%

30.0%

35.0%

40.0%

-

50

100

150

200

250

300

350

400

450

FY2013 FY2014 FY2015 FY2016

Gross Profit


39 46

97 119

5.9% 4.4%7.5% 7.8%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

14.0%

-

20

40

60

80

100

120

140

FY2013 FY2014 FY2015 FY2016

EBITDA


20 23

54 65

3.1% 2.2%4.1% 4.2%

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

7.0%

8.0%

9.0%

10.0%

-

10

20

30

40

50

60

70

FY2013 FY2014 FY2015 FY2016

Net Income


Commercial Real Estate: FY2016 Financial Highlights

• Flat Net Income due to stablerental income and effectivemanagement of operatingexpenses

• On-going refurbishment of 6community malls acquired in2015 and on-going developmentof 2 new community malls inArvo Mall, Marikina with targetcompletion by 1H2017 andBinan Laguna by 2H2017

Key Highlights

20

(In PHP millions)

-4% -4%

-7% -0.5%

1,838 2,210

2,423 2,326

FY2013 FY2014 FY2015 FY2016

Revenues

980 1,275

1,464 1,404

53%58% 60% 60%

40%

45%

50%

55%

60%

65%

70%

75%

80%

-

200

400

600

800

1,000

1,200

1,400

1,600

FY2013 FY2014 FY2015 FY2016

Gross Profit


771

1,346 1,504 1,394

42%

61% 62% 60%

30%35%40%45%50%55%60%65%70%75%80%85%90%

200

400

600

800

1,000

1,200

1,400

1,600

FY2013 FY2014 FY2015 FY2016

EBITDA


563

959 1,028 1,023

31%

43% 42% 44%

20%

25%

30%

35%

40%

45%

50%

55%

60%

65%

70%

-

200

400

600

800

1,000

1,200

FY2013 FY2014 FY2015 FY2016

Net Income


2016

Rental Yield, gross 11.6%

Rental Yield, net 6.35%

Debt : Equity 0.61

ROE 7.0%

Commercial Real Estate: Property Portfolio

Metro Manila• 13 Commercial Buildings• 5 Land under lease

Key statistics

Luzon• 16 Commercial Buildings• 3 Land under lease• Nueva Ecija, Batangas,

Zambales, Isabela, Aurora,Quezon, Rizal, Cavite, Bulacan,Pampanga, Pangasinan

Visayas

• 1 Land under lease• Cebu City

Area with commercial property

Geographic coverage

21

Category 3Q2016GLA/Lot

Area in sq.m.

Investment cost

in PHP millionLand under lease

9 146,148 4,243.50

Commercial Buildings

29 259,215 12,973.30

Total 38 405,363 17,216.80

* Ave. Occupancy Rate 94.%

Thank you.

www.coscocapital.com

fy2016 results investor presentation -...

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