“We Always Want More” ROADSHOW 2006 Europe
Mar 28, 2015
“We Always Want More”
ROADSHOW 2006 Europe
“We Always Want More”
CONTENTS
• Overview of Lojas Americanas
• Time Line
• Five Main Fronts of Growth
• Lojas Americanas in figures
• Business strategy
•Priorities for Cash
•Operating Highlights 1Q06
“We Always Want More”
OVERVIEW OF LOJAS AMERICANAS
US$ 1.5 billion (R$ 3.6 billion) Consolidated Gross Revenue in 2005
Market Cap of US$ 2.5 billion (R$ 6.0 billion)
EBITDA Margin 12.0% (2005)
Net Income 2005 US$ 73.4 million (R$ 176.1 million)
Brazilian leader in sales : CDs, DVDs, cookies, chocolates, candies, toys, lingerie
Prominent position in Brazil’s retail sector
Leading position in LATAM Internet (Americanas.com/Shoptime)
Personal loans and consumer credit offering
3 Distribution Centers
9.4 thousand employees
Awards:
Agência Estado Destaque Empresas 2005 (The Best performance for the shareholders)
Folha de São Paulo “Top of Mind 2005”
Revista Exame - “Melhores e Maiores”
Forbes Brasil - “Platinum List 200”
iBest “Best Ecommerce Site”
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The number of stores doubled in the last 5
years!
Organic Growth
Record: 37 new stores
Shoptime Acquisition
Americanas Taií Creation
TIME LINE
1929 ’82 ’98 ’99’40
77 years old
’05
Lojas AmericanasFoundation
Lojas Americanas goes public
(IPO)
Garantia’s Bank
partners
Focus in the core business
(IT/Logistics)
Lojas AmericanasTurnaround
Americanas.comCreation
2001
AmericanasExpressProject
’03
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Multi-Channel Retailing
FIVE MAIN FRONTS OF GROWTH
DC SPDC SP103 stores
53,000 m²
DC RJDC RJ69 stores69 stores35,500 m²
DC PEDC PE30 stores30 stores22,900 m²
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Multi-Channel Retailing
Bricks-and-mortar Business
202 stores
(may/06)
180 traditional - avg.1,500 m2
22 express - avg. 500
m2
Average Ticket: R$ 24.1
Customer Profile:
up to 1.8MM customers/day in events
77% women - Middle
class
North2
MidWest
19
South
27
Southeast
125
Northeast
29
FIVE MAIN FRONTS OF GROWTH
DC PEDC PE30 stores30 stores22,900 m²
DC RJDC RJ69 stores69 stores35,500 m²DC SPDC SP
103 stores103 stores53,000 m²
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E-Commerce and TV Channel
Business
2 websites, telephone sales,
Catalogue and TV channel
(14MM antennas)
Brazil - 1st. in sales on line -
6 MM Customers
Average Ticket R$ 300
Complementary Assortment
Exclusive and differenciated
products
Multi-Channel Retailing
6 MILLIONCUSTOMERS
+ 200 countriesaround the world
FIVE MAIN FRONTS OF GROWTH
DC SPDC SP
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Financial Business
Joint-venture w/Banco Itaú
Personal Loans, Consumer Credit, Private Label and Co-branded Cards
Multi-Channel Retailing
+ 16 own stores
FIVE MAIN FRONTS OF GROWTH
North2
MidWest
19
South
27
Southeast
125
Northeast
29
“We Always Want More”
FIVE MAIN FRONTS OF GROWTH
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LOJAS AMERICANAS IN FIGURES
1,5101,693
1,7651,918
2,325
2,949
3,640
1000
1500
2000
2500
3000
3500
4000
1999 2000 2001 2002 2003 2004 2005
Gross Revenue (R$ million)
CAGR: 15.8%
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8.0
90.1
142.8
217.6
274.7
330.9
0
50
100
150
200
250
300
350
2000 2001 2002 2003 2004 2005
Consolidated EBITDA (R$ million)
CAGR: 110.5%
LOJAS AMERICANAS IN FIGURES
0.6%NR
12.0%NR
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25.9
22.5
20.8
19.0 18.918.4
10
15
20
25
2000 2001 2002 2003 2004 2005
SG&A Expenses (% Net Revenue)
LOJAS AMERICANAS IN FIGURES
-7.5 pp
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25.2
28.1
29.5 30.230.9
30.3
20
25
30
2000 2001 2002 2003 2004 2005
Gross Margin (% Net Revenue)
LOJAS AMERICANAS IN FIGURES
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170
229
266
309
344
100
150
200
250
300
350
2001 2002 2003 2004 2005
Gross Revenue per Associate (R$ thousand)
CAGR: 15.1%
LOJAS AMERICANAS IN FIGURES
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LAME3 X LAME4 X IBOVESPA
0
500
1000
1500
2000
2500
jan-01 jan-02 jan-03 jan-04 jan-05
LAME3 LAME4 IBOVESPA
LAME3
LAME4
IBOV
Return on Equity
2001 2002 2003 2004 2005
47.2%
25.9%
59.6%Earnings per Share (R$)
54.9%
33.9%
2001 2002 2003 2004 2005
1.54
0.83
2.64
1.78
0.96
LOJAS AMERICANAS IN FIGURES
LAME3 2,422%LAME4 1,913%IBOV 119%
Growth 2001-2005
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41.4%
2.4%
56.2%
7.1%
29.6%
2.7%60.6%
Shareholders Capital StructureShareholders Capital StructurePosition at March, 2006Position at March, 2006
Common SharesCommon Shares
Preferred SharesPreferred Shares53.3%
2.6%18.4%
25.7%
ControllingShareholders
CBV
Treasury
Free Float
Total SharesTotal SharesForeignInvestors
4.4%
Foreign Investors
37.0%
Foreign Investors
24.7%
LOJAS AMERICANAS IN FIGURES
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BUSINESS STRATEGY
•Population: over 180 million•Number of mobile phones: 90 million•Credit cards: over 50 million•Internet users: over 20 million
Over 5,500Brazilian cities
Brazil in figuresBrazil in figures
Opportunities
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5,500
Less 100,000inhabitants
Over 100,000inhabitants
Cities withLASA stores
70210
5,220
Less 100,000inhabitants
Over 100,000inhabitants
Cities withLASA stores
options via Internet, telesales, catalogsoptions via Internet, telesales, catalogs and TV and TV
to a potential public of 43 million Brazilians. to a potential public of 43 million Brazilians. Opportunitie
s
BUSINESS STRATEGY
Potential Potential
Growth Growth
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ExpansionPillars
Number of inhabitantsNumber of inhabitants
Integration of Integration of locations and logisticslocations and logistics
Presence of other Presence of other playersplayers
Consumer ProfileConsumer Profile
Bricks and Mortar BusinessBricks and Mortar Business
BUSINESS STRATEGY
37
16
47
35
2001 2002 2003 2004 2005 2006
?
22
10
Stores openedStores programmed
Stores under negotiation
“We Always Want More”
16
2
5
9
BUSINESS STRATEGY
Bricks and Mortar BusinessBricks and Mortar Business
Niterói - RJ - Estrada de Itaipú Express
Rio de Janeiro - RJ 2 Express
São Paulo – SP 1 Traditional + 4 Express
Ribeirão Preto - SP
Suzano - SP
Taubaté - SP
São José do Rio Preto – SP 1 Traditional + 1 Express
Divinópolis - MG
Ipatinga - MG
Barreiro - MG
Northeast Region
Southeast Region
Middle-West Region
Recife-PE 2 Express
Natal - RN
Vitória da Conquista - BA
São Luis - MA 2 Traditional
Fortaleza - CE
Maracanaú - CE
Feira de Santana – BA
Criciúma - SC
Curitiba - PR 2 Traditional
Londrina - PR
Tubarão - SC
Dourados - MS
Cuiabá - MT
10 stores
opened
+22 stores
schedule
d
South Region
ExpansionExpansion
20062006
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Latin America’s #1 E-retailerLatin America’s #1 E-retailer - - Multi ChannelMulti Channel
200.000 SKUs are available for 6200.000 SKUs are available for 6 million million customerscustomers
TV channel that reaches 14 million antennas and growingTV channel that reaches 14 million antennas and growing
Our E-commerce business represents 24% of LASA consolidated sales Our E-commerce business represents 24% of LASA consolidated sales
(2005)(2005) E-commerce in Brazil
over 90% of Brazilian
consumers have never
purchased on the Internet
BUSINESS STRATEGY
“We Always Want More”
25.280.8
166.4
267.6
434.0
864.8
0
100
200
300
400
500
600
700
800
900
1000
2000 2001 2002 2003 2004 2005
E-commerce Gross Revenue (R$ million)
* Shoptime´s acquisition was in September, 2005
CAGR: 102.8%
*
BUSINESS STRATEGY
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Co-Branded International Cards (Visa/ MC) August,2006
Co-Branded Cards (Visa/ MC) August,2006
Personal Loan Card May,2006
Private Label Card May,2006
Joint Venture LASA - BANCO ITAU
JV will enable credit access for over 40
million brazilians without bank accounts
Personal Loans, Consumer Credit, Private
Label and Co-branded Cards
Benefits
Selling Expenses reduction (fees)
Improvement in consolidated Working
Capital
LASA´s Capital Gain: R$ 200 million (50% of
JV)
BUSINESS STRATEGY
Forms of Payment (1Q06)
56%
Cash
11% Other
42%
Credit Card
2% Checks
Lojas Americanas Americanas.com
89%
Credit Card
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PRIORITIES OF CASH
56.3 57.0
14.6
87.2 86.5 89.2
2.311.1
28.5
0.4
18.1
35.3
2001 2002 2003 2004 2005 2006
Total Total
2001-2006:2001-2006:
R$ 486.5 MMR$ 486.5 MM
46% EBITDA46% EBITDA
Expansion Program and InvestmentsExpansion Program and InvestmentsTechnology and OperationsTechnology and Operations Store openings and remodelingStore openings and remodeling People - capacitating the associatesPeople - capacitating the associates
Share Buy-Back and Dividends ProgramShare Buy-Back and Dividends Program
EVA EVA ® ® OrientedOriented
Dividends Payment and Share Buy-back Program (R$ million)
Dividends Payment
Share Buy-back
Store Opening Evolution
Stores openedStores programmed
Stores under negotiation
37
16
47
35
2001 2002 2003 2004 2005 2006
?
22
10
* 2005 - Shoptime Acquisition R$ 117 million* 2005 - Shoptime Acquisition R$ 117 million
CAPEX budget for 2006: R$ 158.1 MMCAPEX budget for 2006: R$ 158.1 MM
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Our headquarters, stores and distribution centers are Our headquarters, stores and distribution centers are connected in real-time, allowing total control over connected in real-time, allowing total control over operations. operations.
10.4 Million tickets / month10.4 Million tickets / month3.2 thousand points of sales3.2 thousand points of sales3 million credit cards transactions / month3 million credit cards transactions / month
TECHNOLOGYTECHNOLOGY
PEOPLEPEOPLE Employees’ training programsEmployees’ training programs
90% of all store managers are formed by the company90% of all store managers are formed by the company
OPERATIONSOPERATIONSBy using the CDs, we cut down on inventories and losses By using the CDs, we cut down on inventories and losses and optimized distribution by daily deliveries of the and optimized distribution by daily deliveries of the replacement stock requested, guaranteeing products at replacement stock requested, guaranteeing products at the right time, in appropriate quantities.the right time, in appropriate quantities.
Technological innovations to increase the efficiency of the business processes and keep pace with the Company’s expansion.
BUSINESS STRATEGY
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OPERATING HIGHLIGHTS – 1Q06OPERATING HIGHLIGHTS – 1Q06
Better Operating Efficiency (vs. 1Q05 - difference in Easter sales Better Operating Efficiency (vs. 1Q05 - difference in Easter sales
period)period)
Consolidated EBITDA (R$75.1 million) grew by 12.6%Consolidated EBITDA (R$75.1 million) grew by 12.6%
Operating Income (R$55.5 million) 7.4% increaseOperating Income (R$55.5 million) 7.4% increase
0.2 p.p. reduction in G&A expenses, as % of NR0.2 p.p. reduction in G&A expenses, as % of NR
SSS growth Jan-April/2006 vs. Jan-April/2005 + 12.1%SSS growth Jan-April/2006 vs. Jan-April/2005 + 12.1%
Gross revenue per associate grew by 7.9%Gross revenue per associate grew by 7.9%
110% increase in consolidated gross revenue of A.com and 110% increase in consolidated gross revenue of A.com and
ShoptimeShoptime
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This presentation contains forward-looking statements. Such statements are not statements of historical fact, and reflect the beliefs and expectations of the Lojas Americanas’management. The words "anticipates", “wishes”, “expects”, "estimates", “intends", "forecasts", "plans", "predicts", "projects", "targets" and similar words are intended to identify these statements, which necessarily involve known and unknown risks and uncertainties. Known risks and uncertainties include, but are not limited to, the impact of competitive products and pricing, market acceptance of products, regulatory environment, currency fluctuations, supply difficulties, changes in product sales mix, and other risks. Forward-looking statements speak only as of the date they are made, and the Company does not undertake any obligation to update them in light of new information or future developments.
MSCI Logo:The use of Morgan Stanley Capital International Inc.´s ("MSCI") trademarks and index names does not constitute a sponsorship, endorsement or promotion by MSCI, any of its affiliates, any of its information providers or any other third party involved in, or related to, compiling, computing or creating any MSCI index. The MSCI indexes are trademarks of MSCI or its affliates and have been lincensed for use for certain purposes by Lojas Americanas S.A.
“WE ALWAYS WANT MORE”
“We will continue to pursue our learning path and to overcome obstacles, and this makes us enthusiastic since it will enable us to achieve new levels of results, always seeking to better meet our customer’s needs”.