presentacion falabella dic 2014

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CORPORATE PRESENTATION DECEMBER 2014 SACI FALABELLA CONFIDENTIAL

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Page 1: Presentacion Falabella Dic 2014

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PRESENTATION

DECEMBER 2014

SACI

FALABELLA CONFIDENTIAL

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CONTENTS

• THE COMPANY

• CONSOLIDATED

STATEMENTS

• BUSINESS UNITS

• KEY INVESTMENT

HIGHTLIGHTS

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125th ANNIVERSARY OF THE COMPANY

3

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DE

PA

RT

ME

NT

ST

OR

ES

HO

ME

IM

PR

OV

EM

EN

T

SU

PE

RM

AR

KE

TS

FIN

AN

CIA

L S

ER

VIC

ES

RE

AL E

ST

AT

E

Note: Financial data and outlets information as of September 2014 LTM. FX rates as of 09/30/2014 (599.2 CLP/US$).

Includes Sodimac Colombia revenues and Aventura Plaza malls and GLA, which do not consolidate.

Revenues

US$ 4,118 m

Stores

93

Revenues

US$ 5,447 m

Stores

236

Revenues

US$ 1,928 m

Stores

92

Gross Loans

US$ 5,783 m

CMR Accounts

4.4 million

m2 GLA

1,9 million

Malls / Power &

Shopping

Centers

19 / 18

4

FALABELLA AT A GLANCE

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• 43 Department Stores

• 83 Home Improvement

• 49 Supermarkets

• 14 Malls

• 10 Power Centers /

Shopping Centers

• 24 Department Stores

• 55 Home Improvement

• 43 Supermarkets

• 4 Malls

• 8 Power Centers /

Shopping Centers

• 15 Department Stores

• 33 Home Improvement

• 1 Mall

11 Department Stores

8 Home Improvement

57 Home Improvement

Note: Data of number of stores and malls as of September 2014. Includes Sodimac Colombia and Aventura Plaza, which do not consolidate.

421 STORES

5 COUNTRIES

37 MALLS

98k EMPLOYEES

REGIONAL FOOTPRINT

5

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6

DIVERSIFIED PORTFOLIO

Does not consider Sodimac Colombia and Aventura Plaza in Peru, which do not consolidate

2009

REVENUES LTM

Sep 2014

EBITDA

LTM Sep 2014

2009

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CONTENTS

• THE COMPANY

• CONSOLIDATED

STATEMENTS

• BUSINESS UNITS

• KEY INVESTMENT

HIGHTLIGHTS

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DEPARTMENT STORES

Regional Footprint

93 stores operating in Chile, Peru, Colombia and

Argentina

Main categories: apparel, home electronics

and home décor

Diverse portfolio of own brands, second generation

and exclusive brands in addition to international brands

Leading online retailer

Business Overview

24 Stores

43 Stores

15 Stores

11 Stores

Note: Figures in US$ converted using the September 30, 2014 exchange rate (599.2 CLP/US$).

1. Sales LTM divided by average m2

Revenues LTM Sep 2014

(US$ m)

Sales / m2 LTM Sep 20141

(US$)

LOCAL

MARKET

CUSTOMIZATION DIFFERENTIATION

PROFITABILITY

8

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236 stores in Chile, Peru, Colombia, Argentina and Brazil

Main categories: construction materials and home improvement products

Six formats: Homecenter, Sodimac Constructor, Imperial, Homy, Dicico and Maestro

Expertise in direct selling to construction sector and large companies

Strong online strategy

55 Stores

83 Stores

33 Stores

8 Stores

57 Stores

HOME IMPROVEMENT

DIY

Professional Wholesale

Business Overview

Regional Footprint Revenues LTM Sep 2014

(US$ m)

Sales / m2 LTM Sep 20141

(US$)

Note: Figures in US$ converted using the September 30, 2014 exchange rate (599.2 CLP/US$).

1. Sales LTM divided by average m2 9

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Started operations in 2002 in Peru under Tottus brand and entered

Chilean market in 2004 with the acquisition of San Francisco

Operates 92 stores in Chile and Peru, with two main formats:

hypermarkets and supermarkets

Increased penetration of private labels

Developed online platform

43 Stores

49 Stores

SUPERMARKETS

Value

Proposal

Price

Positioning

Brand

Positioning

Note: Figures in US$ converted using the September 30, 2014 exchange rate (599.2 CLP/US$).

1. Sales LTM divided by average m2

Business Overview

Regional Footprint Revenues LTM Sep 2014

(US$ m)

Sales / m2 LTM Sep 20141

(US$)

10

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Bank Branches: 59

CMR Accounts: 0.9 million

Bank Branches: 95

CMR Accounts: 2.1 million

Bank Branches: 49

CMR Accounts: 0.7 million

Bank Branches: 0

CMR Accounts: 0.5 million

Banking Business1:

Banking services in Chile, Peru and Colombia

Offers consumer financing, credit cards, savings

and checking accounts, and mortgage loans

CMR:

Operations in Chile and Argentina

Provides credit through installment payment plan

options and cash advances

Total 4.4 million CMR accounts regionally

Gross Loan Portfolio (Sep 14) USD M

Loan Loss Provision2 (%, 3Q 2014)

1. Consolidates our CMR credit card operations in Peru and Colombia 2 Per local regulation (not comparable across the countries)

Note: Figures in US$ converted using the September 30, 2014 exchange rate (599.2 CLP/US$)

FINANCIAL SERVICES

Business Overview

Regional Footprint

11

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REAL ESTATE

Largest operator in Chile and Peru, and one of the leaders in Latin

America:

Mall Plaza: Operates large shopping malls in Chile, Peru

(through Aventura Plaza) and Colombia.

Open Plaza: Operates small shopping centers with 2 or 3 of

our retail formats as anchor stores, as well as other third-

party minor stores.

1 Owned by the company.

International

Expansion

Sustainable

Growth

Urban

Centers

3Q13 3Q14 3Q13 3Q14

Mall Plaza 13 14 1,033 1,136

Open Plaza 7 10 159 235

CHILE 20 24 1,192 1,371

Aventura Plaza 4 4 236 261

Open Plaza 7 8 206 231

PERU 11 12 442 492

Mall Plaza 1 1 26 26

COLOMBIA 1 1 26 26

TOTAL 32 37 1,660 1,889

Free Standing Stores1 782 904

# Shopping Malls '000 GLA

12

Business Overview

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CONTENTS

• THE COMPANY

• CONSOLIDATED

STATEMENTS

• BUSINESS UNITS

• KEY INVESTMENT

HIGHTLIGHTS

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14

1

2

3

4

5

Presence in dynamic markets with strong industry

fundamentals

Highly experienced management team with a long-term vision

and unmatched governance standards

Customer-centric strategy that drives superior brand

recognition

Proven execution of growth strategy through organic and

inorganic initiatives

Undisputed leadership in Latam across retail formats

KEY INVESTMENT HIGHLIGHTS

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15

Home Improvement Financial Services

• 2,062 M USD

905 M USD

599 M USD

551 M USD Only relevant player

Department Stores

3,023 M USD

555 M USD

1,318 M USD

214 M USD

336 M USD

Real Estate

24 Shopping Malls

GLA 1.4mm m²

12 Shopping Malls

GLA 0.5mm m²

1 Shopping Mall

Supermarkets

988 M USD

940 M USD

95 Bank Branches

CMR Accounts: 2.1 mm

59 Bank Branches

CMR Accounts: 0.9 mm

49 Bank Branches

CMR Accounts: 0.7 mm

No Bank Branches

CMR Accounts: 0.5 mm

Data as of September 2014

#1 #1 #4 #1

#1

#1

Market

position

#1

Market

position

#4

#1

#2

Market

position

#3

Market

position

Market

position

#1

#1

Market position based on sales¹ Market position based on GLA¹ Market position based on number of

active credit cards¹

Department Stores Home Improvement Supermarkets

Sales / m² LTM 2Q14 (US$)

Chile

Sales / m² LTM 2Q14 (US$) Sales / m² LTM 2Q14 (US$)

1. UNDISPUTED LEADERSHIP IN LATAM ACROSS RETAIL FORMATS

#1

Chile Peru

Revenues LTM Revenues LTM Revenues LTM

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Sodimac acquires

Imperial Home

Improvement in

Chile

Falabella-Sodimac

merger

Org

anic

In

itia

tive

s

Acq

uis

itio

ns

2002 2003 2004 2006 2007 2013 2014

First Tottus

in Peru

Falabella

acquires

San Francisco

supermarkets

in Chile

Falabella.com is

launched in

Argentina

Launch of

Móvil Falabella

Sodimac

acquires

Maestro

in Peru

Sodimac acquires

Dicico Home

Improvement in

Brazil

Source: Company filings (Chilean GAAP until 2008, IFRS from 2009 to 2013)

Note: Revenue calculated as follow: Revenue from continuing operations + Banking Business Income; Figures in US$ converted using the September 30, 2014 US$/Ch$ exchange rate of 599.2 16

Revenue evolution (US$ mm)

Falabella has an unparalleled history of growth

2. PROVEN EXECUTION OF GROWTH STRATEGY

1980

Falabella

launches

CMR

1990

Falabella

develops its

first shopping

center

Mall Plaza

Entry to

Argentina,

Peru and

Colombia

1993-5

Falabella.com

is launched

in Chile

1999 1998

Banco

Falabella is

launched

in Chile

2005 2010-11

Falabella.com

is launched in

Peru and

Colombia

Sodimac.com

is launched

in Peru

2000

Tottus.com

is launched

in Chile

Falabella

and

CMR enter

Colombia

Sodimac.com

is launched

in Colombia

Sodimac.com

is launched

in Chile

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17

157 STORES

15 MALLS

US$4.1bn

Investment (US$ mm)

# Stores & Malls

INVESTMENT PLAN 2014 – 2017

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Consistent interaction with

our customers...

...anticipating their preferences

and designing targeted

marketing campaigns

When does she

purchase

Where

does she

purchase

What

does she

like

What

are her

interests

How much

does she

spend

Means of

payment

What

does she

buy

18

...both in traditional and online

platforms…

3. CUSTOMER CENTRIC STRATEGY

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OUR CUSTOMERS

19

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632

3,994

1,220

4,707

Jun-07 Jul-08 Aug-09 Sep-10 Oct-11 Nov-12 Dec-13

Debit card transactions Credit card transactions

63%

30%

53% 42%

91%

37%

70%

47% 58%

9%

Formal (% total sales) Informal (% total sales)

20

Sources: ILACAD World Retail and US Census Bureau for In/Formal Retail Market, SBIF (Chilean Bank’s Superintendency) for Card Payments. Bloomberg for GDP growth and retail sales.

Considers only Chilean banks

Formal vs. Informal Retail (% of total sales)

Proliferation of Card Payments – Chile1 (US$ mm)

4. DYNAMIC MARKET WITH STRONG FUNDAMENTALS

Real GDP Growth Latam vs USA/EU (% annual var.)

Real Retail Sales Growth (% monthly var.)

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Name Position Position Held Since

Carlo Solari Donaggio Chairman 2014

Juan Carlos Cortés Solari Vice-Chairman 2014

José Luis del Rio Goudie Director 2003

Sergio Cardone Solari Director 1986

Carolina del Rio Goudie Director 2011

María Cecilia Karlezi Solari Director 2003

Paola Cuneo Queirolo Director 2014

Carlos Alberto Heller Solari Director 2002

Hernán Büchi Buc * Director 1996

Most Convincing and

Coherent Strategy in Latam

Best Managed Company in

Chile

CEO

- 20 years -

* Independent Member 1 As of September 30, 2014

More Than 13 Years in Average in the Group Market Recognition

Board of Directors Members Controlling Group Consisting of 7 Families1

21

Supermarket

GM

- 14 years -

Home

Improvement

General

Manager

- 12 years -

Department

Stores GM

- 14 years -

Financial

Services

General

Manager

- 6 years -

Chief Planning

and

Development

Officer

- 5 years -

CFO

- 8 years -

General Counsel

- 15 years -

Corporate

Controller

- less than one

year -

Peru Country

Manager

- 19 years -

Colombia

Country

Manager

- 20 years -

Real Estate GM

- 19 years -

Argentina

Country

Manager

- 15 years -

CIO

- 22 years -

Shopping Mall

GM

- 25 years -

Brazil Country

Manager

- 1 year -

5. HIGHLY EXPERIENCED MANAGEMENT TEAM

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SUSTAINABLE BUSINESS

CUSTOMERS

EMPLOYEES

SUPPLIERS

COMMUNITY

ENVIRONMENT

- +99,000 Employees

- 52% Women

- 3.3 Million hours of training

- +16,500 Suppliers

- 41% SMEs

- 231 KWH/M2 Consumption

- 3 Stores opened in 2013 meet with Leed

- First sustainable shopping mall in Chile, obtaining Leed Certification at Gold Level

- Partnership with América Solidaria

- Entrepreneurship Programs

- Partnership with NGOs and Foundations for Donations of Spare Change

- Haciendo Escuela Program

- Financial Training Program:

- Together we Learn Internet Portal through which customers can familirize in

the world of finance

- Let’s Play Together Contests in Schools

22

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CONTENTS

• THE COMPANY

• CONSOLIDATED

STATEMENTS

• BUSINESS UNITS

• KEY INVESTMENT

HIGHTLIGHTS

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24 Note: Financial information as of September 2014 LTM. FX rates as of 09/30/2014 (599.22 CLP/US$)

3Q14 INCOME STATEMENT

(USD Million) 3Q13 % Rev. 3Q14 % Rev. Var %

Revenues of Non-Banking Operations 2,477 2,727 10.1%

Revenues of Banking Operations 198 230 15.9%

Total Revenues 2,676 2,957 10.5%

COGS of Non-Banking Operations (1,658) -66.9% (1,833) -67.2% 10.5%

COGS of Banking Operations (88) -44.1% (88) -38.2% 0.2%

Gross Profi t 930 34.7% 1,036 35.0% 11.4%

SG&A Expenses (687) -25.7% (775) -26.2% 12.8%

Operational Incom e 243 9.1% 261 8.8% 7.5%

Depreciation + Amortization 72 2.7% 86 2.9% 19.4%

EBITDA 315 11.8% 347 11.7% 10.2%

Other Income / (Expenses) 0 0 -82.5%

Net Financial Income / (Cost) (55) (55) -1.0%

Profit / (Loss) in Associates 7 11 50.2%

Exchange Rate Differences (3) (12) 268.9%

Non-Operating Profi t (51) -1.9% (56) -1.9% 9.8%

Profi t Before Tax Expenses 192 7.2% 205 6.9% 6.9%

Income Tax (45) (49) 9.2%

Minority Interest (19) (20) 4.2%

Net Profi t / (Loss) 128 4.8% 136 4.6% 6.4%

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25

9M14 INCOME STATEMENT

(USD Million) 9M13 % Rev. 9M14 % Rev. Var %

Revenues of Non-Banking Operations 7,230 8,195 13.3%

Revenues of Banking Operations 558 675 21.0%

Total Revenues 7,788 8,870 13.9%

COGS of Non-Banking Operations (4,819) -66.6% (5,492) -67.0% 14.0%

COGS of Banking Operations (258) -46.3% (294) -43.6% 14.0%

Gross Profi t 2 ,711 34.8% 3,084 34.8% 13.8%

SG&A Expenses (1,929) -24.8% (2,232) -25.2% 15.7%

Operational Incom e 782 10.0% 852 9.6% 9.0%

Depreciation + Amortization 205 2.6% 248 2.8% 20.6%

EBITDA 987 12.7% 1,100 12.4% 11.4%

Other Income / (Expenses) (3) (0) -87.3%

Net Financial Income / (Cost) (121) (188) 55.7%

Profit / (Loss) in Associates 21 30 43.0%

Exchange Rate Differences (13) (38) 191.8%

Non-Operating Profi t (117) -1.5% (197) -2.2% 69.4%

Profi t Before Tax Expenses 665 8.5% 655 7.4% -1.6%

Income Tax (148) (136) -7.8%

Minority Interest (57) (51) -10.6%

Net Profi t / (Loss) 460 5.9% 467 5.3% 1.5%

Note: Financial information as of September 2014 LTM. FX rates as of 09/30/2014 (599.22 CLP/US$)

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BALANCE SHEET AS OF SEP 2014

Note: Financial information as of September 2014 LTM. FX rates as of 09/30/2014 (599.22 CLP/US$)

(USD Million) Sep-14 (USD Million) Sep-14

Non-Bank ing Operat ions Non-Bank ing Operat ions

Current Assets Current Liabil i t ies

Cash & cash equivalents 231 Other current financial liabilities 1,047

Current trade & other receivables 2,160 Current trade & otherpayables 1,300

Inventories 1,774 Others 383

Others 419

Total Current Assets 4,585 Total Current Liabil i t ies 2,717

Non-Current Assets Non-Current Liabil i t ies

Non-Current trade & other receivables 315 Other non-current financial laibilities 3,964

Goodwill 817 Others 542

PP&E 6,957

Others 798

Total Non-Current Assets 8,899 Total Non-Current Liabil i t ies 4,653

Total Non-Bank ing Operat ions Assets 13,484 Total Non-Bank ing Oper. Liabilt ies 7,371

Loans and accounts receivable from clients 3,516 Total Bank ing Oper. Liabil i t ies 4,129

Others 1,416 TOTAL LIABILITIES 11,500

Total Bank ing Operat ions Assets 4,932 Shareholders ' Equity 6,916

TOTAL ASSETS 18,416 TOTAL EQUITY & LIABILITIES 18,416

ASSETS EQUITY & TOTAL LIABILITIES

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27

Note: Financial Statements in CLP translated at FX as of 09/30/2014 1. Does not include accrued interests

FINANCIAL SITUATION

LEVERAGE (times)

w/o Banking Operations

DEBT BY TYPE

w/o Banking Operations

NET FINANCIAL DEBT/EBITDA (times)

w/o Banking Operations

DEBT BY MATURITY

w/o Banking Operations Financial Debt

w/o Banks1:

US$ 4,922 MM

Duration:

5.04 years

Maestro

effect

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Jordi Gaju

Chief Development Officer

([email protected])

Phone: +56 2 2380 2012

Alejandro González

Chief Financial Officer

([email protected])

Phone: +56 2 2380 2205

Lucrecia Fittipaldi

Corporate Development Manager / Head of IR

([email protected])

Phone: +56 2 2380 2012

Catalina Escaffi

IR / Development Associate

([email protected])

Phone: +56 2 2380 2012

CONTACT INFORMATION

28

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PRESENTATION

DECEMBER 2014

SACI

FALABELLA CONFIDENTIAL

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