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ALFA CONFERENCE 2010
Mexico City
February 4th, 2010
This presentation contains forward-looking information based on numerous variables and assumptions that are inherently uncertain.
They involve judgments with respect to, among other things, future economic, competitive and financial market conditions and future
business decisions, all of which are difficult or impossible to predict accurately. Accordingly, results are likely to vary from those set
forth in this presentation. Copyright © 2010 ALFA, S.A.B. de C.V. All rights reserved. Reproduction and distribution forbidden without
the prior written consent of ALFA, S.A.B. de C.V.
REGISTRATION & WELCOME
2009 RESULTS
ALFA’S STRATEGIC EVOLUTION
OUTLOOK FOR 2010
2009 RESULTS
ALFA’S STRATEGIC EVOLUTION
OUTLOOK FOR 2010
2008 2009
Lower revenues in 2009 due to commodity prices and Nemak’svolumes. However, record EBITDA thanks to strong petrochemical performance.
4
2008 2009
ALFARevenues(U.S. $ Billions)
10.6
8.5
ALFAEBITDA(U.S. $ Millions)
9641,055
EBITDA margin (%) 9.1 12.4
-20% 9%
EBITDA by group(U.S. $ Millions)
5
2008 2009
293
428Alpek
2008 2009
261 273
2008 2009
315261
2008 2009
121104
Sigma
Nemak Alestra
46%5%
17%14%
Lower capital expenditures were needed since Alpek’s investment program was completed in 2008.
ALFACapital Expenditures(U.S. $ Million)
6
ALPEK & NEMAK
Mainly asset replacement.
SIGMA & ALESTRA
Capacity expansion, distribution, new products.
2008 2009
572
288
U.S. $ 288 million
Alestra & Others
73
Sigma
74Nemak
75
Alpek
66
Refinancing of Nemak’s debt, plus Alestra, Petrotemex and Sigma’s bond issues extended average life of consolidated debt …
ALFAMaturity Profile(U.S. $ Millions)
7
BeforeRefinancing Dec. 09
Average Life (years) 1.8 4.2
351453
370267
917
300
121 134 118
250
809
696
891
469
60
409
00 0 117
0
09 10 11 12 13 14 15 16 17 18 19
Jun. 2009Dec. 2009
2008 20092008 2009
… which, coupled with better EBITDA, reinforced the financial condition.
ALFAFinancial Ratios
8
Net Debt / EBITDA*(Times)
Interest Coverage*(Times)
3.5
2.1
3.1
4.3
* 4Q EBITDA times four
2009 RESULTS
ALFA’S STRATEGIC EVOLUTION
OUTLOOK FOR 2010
ALFA obtained excellent results in 2009.
Strategic strengths of businesses proved their value in a crisis year.
ALFA’s human capital talent was demonstrated dealing with a huge crisis.
Confidence from financial community was key.
Streamlined operations now provide even better cost competitiveness than before the crisis.
No need for substantial capital expenditures in the short term.
No meaningful financial commitments in 2010 after 2009 refinancing.
10
Economy in early stage of globalization; 3 crises in 16 years.
11
Salinas1989 – 1994
Zedillo1995 – 2000
Fox2001 – 2006
Calderón2007 – 2012
GrowthReal GDP, avg. (%) 3.9 3.5 2.4 -0.9
InflationAnnual Avg. Rate
(%)16.9 22.0 4.7 4.6
Exchange RatePesos/U.S. $; avg. 3.0 8.3 10.5 11.9
Highlights- NAFTA- Privatizations, deregulation
- Tequila Effect- Fobaproa- Asian Crisis
- “9/11”- US recession
Global commodities crisis
- World financialcrisis
Sources: PIB IMF, CPI IMF, TC Bloomberg
In 1993, ALFA and its environment were very different.
ALFA
Concentrated in Steel and Synthetic Fibers.
Manufacturing operations, mainly .
Focused in Mexico – Incipient exports.
Low capital expenditures during the 80’s.
Recovering financial health.
Environment
Mexico was a closed economy – highly volatile and risky .
Beginnings of globalization – NAFTA.
Oil-based economy
12
ALFA in 1993
13
Portfolio*
Sales EBITDA
(U.S. $ Millions)
2,492
271
Mexico
* Breakdown based on revenues
Size Footprint
New strategy was established in light of then current environment.
ALFA strategy
Complete modernization of commodity-product businesses; grow through “brownfield” investments.
Aggressive growth in high-potential, high value-added businesses.
Divestitures under adequate conditions.
Move into new business areas with great appeal where ALFA could achieve sustainable competitive advantages, e.g.: cogeneration.
14
• Investments to modernize and increase efficiency (global competitiveness).
• Modernization continues. Greater focus on products with added value (galvanized steel, painted and ultra-thin sheets, etc.).
• Incursion into Venezuela due to competitive advantages.• Advancements in HYL direct-reduction technology.
• Overcome global steel industry crisis.• Divestment.
15
96
97
98
99
95
Hylsamex sale
Industry Analysis, Strategy Review Hylsamex Partial Spin-off
Hylsa Bekaert sale
Pickling Expansion
Galvanized and Painting Line
HYL New Plant
Minimill start up
Investments for Plant Modernization
05
93
287
295
Acerex
Minimill Line 2Pickling
Expansion
Sendzimir Cold Mill
Investment in Sidor
New FurnacePuebla Plant
04
02
Self directed teams
50% Purchase Peña Colorada Mine
94Continuous Reactor Sponge
Iron PueblaPainting Line II
First SAP in Mexico
Third Galvanized Line
Sponge Iron capacity
Sale of Sidor stake
Investments
Acquisitions and spin-offs
Technology, Human Capital and Other Relevant Events
EBITDA
U.S. $759 M
Hylsamex IPO
Debt Restructure
Insulated Panels (Galvamet)
Narrow Gauge Rod
ISO 9002
Metallic hood
(Galvateja)
Galvament Line IIPipe Mill No. 6
“Aquila” Mine
Mining capacity growth
EBITDA U.S. $89 M 16
Revenues(U.S. $ Million) 9% CAGR
EBITDA(U.S. $ Million) 21% CAGR
Net Debt / EBITDA(Times)
6.5
4.53.4 2.7 2.9
4.7 4.5 5.1
7.9
5.3 5.4
0.7
Commoditiescrisis
EBITDA/RevenuesMargins(%)
10 16 25 25 24 23 22 18 13 15 13 33
* Divested from ALFA
93 94 95 96 97 98 99 00 01 02 03* 04*
93 94 95 96 97 98 99 00 01 02 03* 04*
93 94 95 96 97 98 99 00 01 02 03* 04*
921 1,006 9401,151
1,395 1,265 1,373 1,4401,211 1,356 1,449
2,305
89163 233
287 334 296 295 253155 197 187
759
17
In summary,
In 1994, Hylsamex had obsolete assets, limited capacity, threat from open market. Low economic value.
¿Modernize or sell? Company was modernized, capacity expanded, value added products introduced. Substantial EBITDA increase.
Worst steel industry crisis in modern history was successful faced.
Company spun-off in the height of the cycle, for significantly more than would have been obtained prior to modernization (U.S. $ 2.4 billon).
18
• Plants modernization with low specific investments.• Entry into PP and EPS.
• Low cost producer.• Modernization and growth in fibers.
• Strengthened position in polyester chain – acquisition of PTA/PET assets in U.S.*, increase PET capacity.
• Profitable growth through scale and learning curve.
• Exit from non-profitable businesses – Nylon, DMT.• Growth in strategic businesses – PTA, PET, PP, EPS.• Energy optimization.• Entry into natural gas business in Texas.
* First major acquisition outside Mexico (2001) 19
94
97
98
99
01
02
03
95
Altamira EPS ExpansionSale of Nylon and Lycra to Koch (keeps Univex, Nyltek)
DAK PET Cooper River start up
JV Akra Teijin in Polyester Fibers
PTA and PET acq.in U.S. (DAK)
Splitter at Indelpro
Enertek cogeneration start up
PTA Altamira start up
Polioles EPS start up
Colombin Bel Acquisition
05
06
07
Natural gas in Texas
DAK PET Cape Fear start up
Acq. Eastman PET Mexico and Argentina
PTA Altamira second expansion
08PP Indelpro II
Expansion
Petrocel (DMT) shut down
Enertek spin-off (Iberdrola)
InvestmentNylon 6,6
93
345
282
09Focus on greater operational efficiency
Increased PP market share in Mexico
Temex capacity growth
Acquisition of Nylon and Univex
Luxor Acquisition (Terza)
Polyester filament Expansion
JV with Shaw to recycle PET
PTA Altamira debottlenecking
Acq. of polyurethane business from BASF
Polioles electricity cogeneration
Petrotemex Energy Efficiency Project 04
First carbon bonds
Nylon 6,6 Expansion
Emission reduction project registered before UN
EPS capacity expansion
EBITDAU.S. $ 428 M
50% sale of Terza to Shaw
ISO 9000 in Polioles
ISO 9002 Nylon de México and Indelpro
Stake acq. Pemex in PTA
Stake acq. Akzo Nobel in Chemical fibers
CPU Fibers start up 96
Texturized Polyester new plant
Lycra Expansion
PTA Cosoleacaque Expansion
Textile Nylon Expansion
Polioles Innovation Project
Fibers Self Managed teams
EBITDA U.S. $ 126 M
Investments
Acquisitions and spin-offs
Technology, Human Capital and Other Relevant Events
20
126 170
329 351 356 345 309 327
261 314 282 311
385 327
278 293
428
93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09
826 994 1,423 1,472 1,560 1,350 1,445 1,754 1,663 1,898 2,209
2,738 3,204 3,410
4,007 4,709
3,971
93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09
21
EBITDA(U.S. $ Million)
EBITDA/RevenuesMargin(%)
8% CAGR
10% CAGR
2.7 2.9
1.3 1.4 2.1
2.7 3.0 3.2
3.8
2.6 2.7 2.2
0.8
1.5 2.1
2.5
1.3
93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09
Net Debt / EBITDA(Times)
CommoditiesCrisis
Revenues(U.S. $ Million)
15 17 23 24 23 26 21 19 16 17 13 11 12 10 7 6 11
In summary,
In 1994, Alpek focused on DMT and synthetic fibers.
As the economy opened up, it was necessary to modernize and expand plants at the lowest possible investment cost.
Synthetic fibers environment changed in the face of China joining the WTO and illegal trade.
It was decided to reduce focus on fibers, strengthen PTA and PET, and expand EPS and PP.
Divestment of non-profitable businesses.
Incursion into natural gas in Texas.
22
• Divesture of fresh meats business.• Boost to refrigerated meats and distribution.• Entry into dairy products and other refrigerated products.• Product development & formulation.
• Investments in brand equity.• Strengthen refrigerated distribution network.• Reinforce position in regional cold cuts.
• Human talent development.• Organic growth, distribution and acquisitions.• Strengthen position in dairy products.• Consolidate position in cold cuts.
• Growth of current business.• Innovation system.• International expansion.
23
80
93
94
97
99
02
03
04
91
New Zealand Dairy Products in
MexicoRefrigerated Pizzas
Refrigerated prepared foods
ChenDairy products in
Mexico
Distribution network in the U.S.
Acquisitions Central America and the Caribbean
Dairy dessertsGalicia
Cold cuts in MexicoCold Coffee
Exports to U.S.
TangamangaCold cuts in Mexico
San AntonioCold Cuts in Mexico
Acquisition of distributors
Yoghurt plantPrepared frozen food
Cheese manufactureOscar Mayer Distribution
in Mexico
Launch of turkey line Divesture of Fresh MeatExports to Central America
ALFA acquires Sigma
05
06
07
Nayar
Cold cuts in MexicoFood Service
Bernina
Cold cuts in Mexico
MCP
Dairy products in U.S.
IASSA
Cold cuts in Mexico
08U.S. cold cuts plantAcquisition Braedt
Cold cuts in PeruAcquisition Longmont
Cold cuts in U.S.
Reinforced distribution network
EBITDA U.S. $ 18 M
09
46
104
218
Yoghurt capacity expansion
Awards from Supermarkets
Integrated Health “SI” program
First CADI Tepoztlán
300k retail clients
Cost and expenses reduction
Bel DistributionFamily Responsible
Company
ANTAD Award (3rd time)
Sigma Innovation system
Philadelphia distribution
Guten
Cheese plant
Atitalaquia Plant
ANSPAC and SIGMA university
100,000+ point of sale refrigerators
2,000+ vehicle network
Young Talent program
First SAP in food industry
Yoplait Franchise
Product development
90
Automated distribution center
Sigma IPO
Product formulation development continues
EBITDAU.S. $ 273 M
Investments
Acquisitions and spin-offs
Technology, Human Capital and Other Relevant Events
24
International Footprint Market share (%)
25
Plants
Distribution Centers
15
3451
Cold Cuts
16
59
25
Cheese
38
42
20
Yogurt
Sigma
Next competitor
Others
Next competitor
Others
Sigma
Others First competitor
Sigma
18 32 30 46 47 36 3668 86 104 121
146174 181 184
218 236 239261 273
90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09
249 299 355 395 422 319 398 540 598 687 848 943 1,0081,0511,220
1,6041,789
2,0682,368
2,187
90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09
26
12% CAGRRevenues(U.S. $ Million)
EBITDA(U.S. $ Million) 15% CAGR
Net Debt / EBITDA(Times)
EBITDA/Revenues Margin(%)
TequilaEffect
Revenue drop due to peso devaluation
0.9
0.3
1.51.7
0.8
2.2
2.7
1.8 1.9
1.41.6
1.00.7 0.6
0.9 0.91.2
1.72.0 1.9
90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09
7 11 8 12 11 11 9 13 14 15 14 15 17 17 15 14 13 12 11 12
In summary,
At the beginning of the 90s, Sigma focused on red meats, had a limited product portfolio, no brands or self distribution. Strategy was changed.
Cold cuts were boosted, dairy product offering broadened, distribution grew organically and through acquisitions.
Investment in brand equity, entry into regional markets.
Investment in R&D and innovation . Development of human talent.
Leadership positions obtained in cold cuts and cheese.
International expansion.
27
• Competitive in quality and costs.• Capacity expansion in Monterrey.• Technologically dependant on Teksid.• Start of exports to the U.S.
• Development of technology and technical skills.• Incursion into engine blocks.• Improvement in product launching.
• Scale and expansion in North America.• Entry into Europe.• Greater emphasis on skill development and R&D.
• Client portfolio diversification.• Global expansion: acquisitions of Hydro, Teksid and Castech.• Synergies and efficiencies.
28
97
98
00
03
Teksid, Hydro and Castech
Plant VI
Rautenbach Germany
100 millionth head produced
Acq. Of Ford Canada plants
First aluminum engine block produced
PDC built in Monterrey
07
09Production relocation
06
05
02
Entry into Europe with Czech plant
95
Focus on product development
26
75
120
08
93
Monterrey Melting Center
Reduction in fixed costs
301
Acquisitions integration
Acq. Of Teksid stake (20%)
12th prize in 13 years from GM as best powertrain supplier
79JV with Ford
Nemak Founded
81
85GM and Chrysler added to customer portfolio
First engine head for Ford
Acq. of Comalco for engine block technology
Leadership+ Program
96
SAP Installation
QS 9000
Plant III
Plant IV
Plant V
Exporter Award
U.S. sales, Plant II
Talent Development
(Nemak 2000)
Technology Development start up
EBITDA
U.S. $ 14 M Investments
Acquisitions and spin-offs
Technology, Human Capital and Other Relevant Events
EBITDA
U.S. $ 261 M
29
Nemak Global Footprint
30
CanadaU.S.
ChinaMexico
Argentina
Brazil
Germany
Poland
HungarySlovakia
Czech RepublicAustria
14 25 26 36 38 4469 75 87
114 120 132 153 146
301 315261
93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09
79 113 118 144 197 222 339 335705 800 844 970
1,243 1,336
2,897 3,026
1,949
93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09
31
22% CAGR
20% CAGR
Revenues(U.S. $ Million)
EBITDA(U.S. $ Million)
EBITDA/RevenuesMargin(%)
Global and auto crises
Net Debt / EBITDA(Times)
1.0 1.3 1.5 1.7
3.4 3.52.6
3.4 3.22.6 2.5
2.1 2.12.8
3.3 3.0
4.8
93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09
18 22 22 25 19 20 20 22 12 14 14 14 12 11 10 10 13
In summary,
In 1994, Nemak was technologically dependant on Teksid. It had limited exports to the U.S.
Investments in R&D; technical skills and own technologies developed.
Leadership in North America obtained.
Diversification to engine blocks.
Global presence and world leadership established through acquisitions. Best technological portfolio in the industry.
32
• Opening of telecom market.• Competing in several market segments. First: LD (voice).• Consumer and enterprise markets.• Unfavorable regulation.
• Focus on data and enterprise.• AT&T Global Network (AGN).
• Bancomer stake bought back.• Transformation to value added services.• Strong presence and differentiation in enterprise
segment.• Integrated networks and convergent services.
33
95
03
05
New brand: Alestra
Buy back of Bancomer stake
Shareholder restructure due to AT&T takeover by SBC
07
06
110
100
119
00Strategic
repositioning
JV with AT&T
Financial Restructure
U.S. $300 M bond
ISO 27001 Information security
AT&T Global Network
Leadership in networks (e.g., SAT)
965,000 Kms
network built
09
Merger with Unicom (Telecom Bancomer)
First LD call1 Million client / 1 Bn
Minutes 97
99EBITDA > 0U.S. $570 M bond issued
U.S. $ 200 m bond
Value Added Services (Data and Internet)
ISO 9002
Centro Experto convergence portfolio
Innovation Program
Boost to IP / Broadband services
Dot.Com crisis
EBITDA
U.S. $ 104 M
EBITDAU.S. $ 53 M
Investments
Acquisitions and spin-offs
Technology, Human Capital and Other Relevant Events
34
-113 -124
30 53 59 82110 96 100 110 119 121 104
97 98 99 00 01 02 03 04 05 06 07 08 09
192313
398 463 413 447 501419 366 391 453 425
345
97 98 99 00 01 02 03 04 05 06 07 08 09
35
5% CAGR
EBITDA(U.S. $ Million)
13% CAGR
Revenues(U.S. $ Million)
EBITDA/RevenuesMargin(%)
Net Debt / EBITDA(Times)
-2.5 -2.3
10.4 8.8 9.5 7.53.4 3.6 3.1 2.4 2.0 1.8 2.0
97 98 99 00 01 02 03 04 05 06 07 08 09
(59) (40) 8 11 14 18 22 23 27 28 26 28 30
Revenue drop due to peso devaluation
In summary,
Alestra founded in 1994 to serve the Mexican telecom market.
Unfavorable regulation.
Change of focus to value added services and market niche approach.
Strong presence and differentiation in enterprise segment.
36
Besides supporting it businesses, ALFA has developed other initiatives.
37
ALFA Foundation
Talent Development
Social Responsibility
R&D
Innovation
Energy
• Modernization of businesses focused on commodities (steel, synthetic fibers) to reach international competitiveness.
• Expansion of Sigma & Nemak. Creation of Alestra.
• Reinforce competitive position.• Increased value added to products.• Development of new products.
• Establish international presence.• Restructure portfolio with focus on companies with better
growth, greater value added and differentiation, less cyclical.
• Consolidate global presence.• Develop world-class competences.
38
Investments
Acquisitions and spin-offs
Technology, Human Capital and Other Relevant Events
93
94
95
96
97
98
99
01
02
03
04
05
06
07
08
09
00
Investments in modernization of plants
Acq. 50% Peña Colorada
Temex capacity increase
Portfolio DiversificationCheese manufacture
Oscar Mayer distribution in Mexico
Focus on Talent and Technology
Sales to U.S. with Plant II
Sponge iron continuous reactor Puebla
Painting Line III
Hylsamex IPO
Acq. Colombin Bel
Invest.Nylon 6,6
Acq. Polyurethanes business from BASF
Sale 50% Terza to Shaw
YoghurtFrozen prepared foods
JV with AT&TAcq. Comalco for
monoblock technologyLeadership
ProgramPolioles EPS
start upAcq. UnivexAcq. Sta. Rosa and Luxor
(Terza)ISO 9000 at
PoliolesPemex PQ privatization
study
New plant HYL
Line 2 Minimill
Expansion Decapado
Sponge iron cap.
Self-directed teams
Metallic tiling
(Galvateja)CPU fibers start up
Expansion PTA Cosoleacaque
Expansion Nylon Textile
Focus on product development
Plant III
5,000 Kms network
Merger with Unicom (Telecom Bancomer)
Galvanized and painting line
Cold millSendzimirAcq. Sidor stake Fine wires
ISO 9002
PTA Altamira start up
Expansion Polyester filament
ISO 9002 Nylon de México and Indelpro
Acq. stake Pemex PTA
Acq. stake. Akzo Nobel Chemical fibers
“San Antonio”Cold cuts MexicoAcq. Distributors
PDC* in Monterrey 20% stake in TeksidQS 9000
Plant IV
1st LD call Client 1 Million / 1 Bn. Minutes
First monoblock Fusion Center Mty“Tangamanga”
Cold cuts Mexico Capacity YoghurtCheese plantEnertek start upTexturized Polyester new plant
Expansion DecapadoNew oven
Puebla plant
Sale Hylsa Bekaert Galvanized Line IIISplitter for
PP at IndelproExpansion Nylon 6,6 to 27
Kta Expansion Lycra“Tangamanga” Capacity YoghurtCheese plantEBITDA > 0570 M dls bond
Strategic repositioning Value Added ServicesISO 9002 2 Ford plants in CanadaSAP Plant VSkill development
(Nemak 2000)
DAK – acq. PTA and PET in US from DuPont
Enertek sale (Iberdrola)
100 millionth headEnergy prize Export to US First CADI TepoztlánANTAD award Joint Venture Akra Teijin polyester fibersDebt restructure
Panel Line II (Galvamet)Pipe mill No. 6
DAK PET Cooper River start upEPS capacityAcq. Central America
and CaribbeanDairy desserts
“Galicia”
Cold cuts MexicoRefrigerated coffee Czech Republic plant
Debt restructure ~300 M bond AT&T Global Network
Refrigerated prepared food
“Chen”Mexico Dairy
Distribution network USPetrotemex emission reduction program
Industry analysis, strategic review Partial Spin-off Hylsamex
Hylsamex spin-offSale of Sidor stake Expansion Altamira
EPS to 165 KtSale of Nylon and Lycra to
Koch (keeps Univex, Nyltek)Repurchase 100% polyester fibers
“New Zealand “
Mexico DairyRefrigerated
pizzasStrengthening of
distribution networkWal-Mart
AwardPhiladelphia Distribution Rautenbach
Export award
Stockholder restructure due to SBC takeover of AT&T
Boost to IP services/ Broad band
Focus on operating efficiency
Increased PP market share in Mexico
JV with Shaw to recycle PETFirst Carbon bonds Cost and expenses
optimizationBel DistributionFamily Responsible
CompanyProduction relocationFixed costs reduction
Leadership in Network (e.g., SAT)
200 M dls bond
Expansion PP Indelpro IIPolioles electricity cogeneration
Emission reduction program registered before U.N. Cold Cuts U.S. plant
“Braedt”Cold cuts Peru
“Longmont”Cold cuts Mexico
ANTAD Award PMI** and Synergies
12th time in 13 years to receive best powertrain supplier award from GM
DAK PET Cape Fear start-up
Acq. Eastman PET Mexico and Argentina
Expansion PTA Altamira to 1.0 Mt
Petrocel shut down (DMT)
“Bernina” Cold cuts Mexico “MCP” U.S. Dairy
“IASSA” Cold cuts Mexico
“SI” integral health program
Sigma Innovation system
Teksid, Hydro and Castech
Our brand: Alestra
ISO 27001 Information security Experto Center
JV Newpek for nat. gas exploration in Texas
Debottlenecking PTA Altamira to 500 Kta
“Nayar” Cold cuts Mexico
Food ServiceHEB and Soriana Awards
300 k Retail clientsANTAD Award Guten
Planta VI Monterrey start-up
Repurchase BBVA stake
Innovation program
39
40
2009
Revenues EBITDA
1,055
* Based on revenues
8,536
Portfolio* Size Footprint: 16 countries
(U.S. $ Million) Canada
U.S.
China
Mexico
El SalvadorCosta Rica
Dominican Rep.
Peru
Argentina
Brazil
GermanyPolandHungarySlovakiaCzech Rep.Austria
93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09
271
1,0559% CAGR
ALFA Annual EBITDA(U.S. $ Million)
383
964
765807
642604
817
668
802802797825
731
617
964
14% CAGR
41
ALFA Total Shareholder Return vs. Securities in U.S. and BMV(1993 - 2009; CAGR in dollars)
U.S.Small
company
Largecompany
(S&P)
Long Term Gov.
Long Term Corporate
ALFA ** Mid TermGov.
T-Bills InflationBMV
Equities* Debt Risk free
Source: Bloomberg
* Adjusted for dividends
** Considering the distribution of Hylsamex´s CPOs as if they were monetized in Aug. 05
DJI
42
10.9 10.8
9.08.0 7.6 7.2
6.04.9
3.22.5
“ALFA has evolved from a regional company with
a commodity focused business portfolio, to a
global company with operations in 16 countries,
in three continents, in more profitable sectors,
with a greater potential for growth, with
products and services of increased added value
and differentiation, and with strong leadership
positions in its relevant markets.”
2009 RESULTS
ALFA’s STRATEGIC EVOLUTION
OUTLOOK for 2010
ALFA: Outlook for 2010
Sales growth explained by more volume, mainly.
45
Revenues(U.S. $ Billion)
EBITDA(U.S. $ Million)
2008 2009 2010e2008 2009 2010e
10.69.0 1,055
1,110
6% 5%
8.5 964
ALFA: Outlook for 2010
46
Capex(U.S. $ Million)
Net Debt(U.S. $ Million)
2008 2009 2010e2008 2009 2010e
288
36% -5%
3932,361 2,292
5722,408
* LTM
Net Debt to EBITDA* (times) 2.5 2.3 2.1
ALPEK: Outlook for 2010
Healthy demand supports revenue growth in 2010.
Lower PET margins explain drop in EBITDA .
2010 EBITDA: the third highest in history.
47
Revenues(U.S. $ Million)
EBITDA(U.S. $ Million)
2008 2009 2010e2008 2009 2010e
4,0354,709
428372
2% -13%
3,971
293
SIGMA: Outlook for 2010
Volume growth basically explains revenue growth.
EBITDA and profitability trends are maintained.
48
Revenues(U.S. $ Million)
EBITDA(U.S. $ Million)
2008 2009 2010e2008 2009 2010e
2,368 2,348261
286
7% 5%
2,187 273
ALESTRA: Outlook for 2010
Value added services growing 12% in 2010, offsetting decline in LD.
Richer revenue mix leads to EBITDA growth.
49
Revenues(U.S. $ Million)
EBITDA(U.S. $ Million)
2008 2009 2010e2008 2009 2010e
425
341 121 112
-1% 8%
345104
Nemak: Outlook for 2010
Gradual improvement in industry conditions. Sales volume up 13%.
Nemak benefits from leaner cost structure after 2009 rightsizing.
50
Revenues(U.S. $ Million)
EBITDA(U.S. $ Million)
2008 2009 2010e2008 2009 2010e
3,026
2,196
315 331
13% 27%
1,949261
2009 Results confirm robust strategic position of ALFA
businesses: record EBITDA despite the crisis.
The above was due to the profound transformation
experienced by ALFA: leadership positions in its relevant
markets, businesses with greater potential, human
capital, state-of-the-art technology.
Growth continues in 2010. Bases are set to keep on
generating value.
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