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INVESTORPRESENTATIONFebruary 2020
CONTENTSTABLE OF CONTENTSMajid Al Futtaim 2019 Performance UpdateAppendix Majid Al Futtaim Group Overview2
2019 Overview
IN 2019 WE HAVE SUSTAINED OUR FINANCIAL POSITION, WHILSTCELEBRATING SOME MILESTONE ACHIEVEMENTSRevenue increased 1%to USD 9.6BEnvironmentalSocialEBITDA increased 1%to USD 1.3BCashflow from Operationsto EBITDA at 122%2 green sukuks issuedtotalling USD 1.2BPortfolio of 26shopping malls welcomedover 200 million visitorsOpened 42 new Carrefour storesTotal store count 306Added 146 cinema screens1Total screens 511GovernanceObtained “low risk” ESGrating from Sustainalytics,and “A” rating from MSCI1 AS4AT FEBRUARY 2020
THERE ARE LONG TERM OPPORTUNITIES IN THE REGION DESPITECURRENT HEADWINDSCurrent Headwinds MENA economies adaptingto slower growth in theshort term until reformprograms shape thelonger term MENAP region’scontribution to world GDPwill increase by 1-2%,driven by populationgrowth Geopolitical tensions haveescalated around US-Iranrelations MENA region continues toexhibit youthunemployment rateshigher than globalaverage Lebanon experiencingpolitical andeconomic instability Diversification of GCCeconomies away fromhydrocarbons High population growthfor MENAP Saudi Arabia and Egyptwill constitute a sixth ofregional real GDP Pakistan will become anew growth pocket UAE’s private sectorremains in a competitiveenvironment Dubai tourism mixchanging due to USDstrength2040 Outlook Mid single digit growthexpected for the rest ofAfrica, with an emergingmiddle class Oil prices adjusted to a“new normal” range as aresult of structuralchanges in the globaleconomy Trade flows expected to begrowing at above globalaveragesSOURCE: McKinsey Consumer Trends Database, Oxford Economics, United Nations, Global insight, Team analysis, Expert interviews,HSBC, IMF, PWC report, UNCTAD, Focus Economics, WEF MENA Risks Landscape5
FROM A CUSTOMER BEHAVIOR PERSPECTIVE, THERE HAS BEEN ASTRONG SHIFT TOWARDS LIFESTYLE, CONVENIENCE AND DIGITALConnectivity71%Internet PenetrationRate is atTrends over brandsSocial connection64%Retail CEO’s continue to seeOf MENA respondentsSustainability66%Of global consumersloyalty towards “trends”rather than “brands”in the Middle-East in 2019use Facebook or Twitterwhen findinginspiration for eriences36% Of global respondents73% Of consumers77% Of global consumersConsumers and especiallymillennialsemphasized price and convenienceas a driver for onlineuse a combination of online andoffline while shoppingexpect to see more personalizedcontent in the futureLook for distinctive andrenewed experiencesAre willing to pay morefor sustainable brandsSOURCE: PWC survey 2017, Total Retail 2017, World Bank, ADEC, Saudi National Statistics, UN, Hootsuite, Nielsen, Reuters, Mckinsey study6
WE REMAIN COMMITTED TO OUR STRATEGIC PRIORITIESMaintain leadershipin our core countriesExpand to be leaders inadjacent/core geographiesProtect our leadershipposition in the UAEExpand our presence in Egyptand Saudi Arabia, driven byour shopping malls businessBuild a foundationposition in AfricaExpand in additionalAfrican countries,primarily with CarrefourGrow at scale at leastone adjacent businessEvaluate business opportunitiesin adjacent businessesWHILE ADOPTING A LEAN AND AGILE APPROACHCost & BalanceSheet OptimizationProcurement andSupply ChainFinancial Disciplinein Investments7Capability BuildingSustainability
Sustainability
OUR SUSTAINABILITY STRATEGY IS INTEGRATED IN THE WAY WE DOBUSINESSOur strategy will manage thesocio-economic and environmentalissues that matter most to us andour stakeholders Local economic development Promoting sustainable lifestyles Product quality & safety Crime and security Community well being & public realm Responsible procurementTRANSFORMINGLIVE Net Positive carbon Net Positive water Circular economy Climate change adaptation Ecosystem servicesRETHINKNGNON-EXHAUSTIVERESOURCES Healthy workplaces Human rights & employment conditions Health & safety Changing role of women in the workplaceEMPOWERINGOUR PEOPLEMajid Al Futtaim has been recognized by external agencies:18.9 /100 G RATING9A
2019 Performance
SUMMARY OF MAJID AL FUTTAIM’S 2019 PERFORMANCESTABLE FINANCIAL PERFORMANCE DELIVERED IN 2019Revenue 1% vs PY to:USD 9.6bnEBITDA 1% vs PY to:USD 1.3bnCFO:EBITDAat:122%Assets 5% vs PY at:USD 17.2bn 2STABILITY AND STRENGTH THROUGH DIVERSIFICATIONGEOGRAPHICAL SPLIT – 31 December 2019By RevenueBy EBITDAOthers¹17%KSA4%Oman6%UAE48%Qatar6%KSA9%By RevenueOman5% Others¹9%Ventures8%UAE59%By %Bahrain8%Qatar7%Bahrain4%SEGMENTAL SPLIT – 31 December 2019Egypt9%Retail79%Egypt9%¹ Others includes Kuwait, Jordan, Pakistan, Lebanon, Iraq, Georgia, Armenia, Kenya, Uganda2 Includes impact from IRFS 1611
Majid Al Futtaim Properties
2019 PERFORMANCE: MAJID AL FUTTAIM PROPERTIESOperational HighlightsRevenueEBITDA(USDmn)(USDmn)1,2641,256 Increased our shopping mall portfolio to 26 with the opening ofCity Centre Al Maza, City Centre Suhar and My City CentreMasdar8142018 Completed redevelopment of City Centre Alexandria inEgypt, and City Centre Ajman in the UAE Visitors to our malls crossed the 200M mark for the first time13201920188132019Malls avg occupancy93%Footfall y-o-y 4%Rent to sales13%Hotels avg occupancy80%REVPAR change y-o-y-8%
Majid Al Futtaim Retail
2019 PERFORMANCE: MAJID AL FUTTAIM RETAILOperational Highlights Celebrated 300th Carrefour store opening, while expanding to16 countries with entry to Uganda Launched new F&B 'live cooking’ concept in select UAE 938339120182019 Introduced robotic automation to increase the capacity of onlineorder fulfilment centresSales (LFL)Hypermarket openings12 Inaugurated our Retail Business School in the UAE, providingfunctional and commercial training for our employeesSupermarket openings30Total storesOnline orders y-o-y15-5%306 600%
Majid Al Futtaim Ventures
2019 PERFORMANCE: MAJID AL FUTTAIM VENTURESOperational HighlightsRevenueEBITDA(USDmn)(USDmn)651761 VOX cinemas celebrated 20 years of operations as itapproached the 500 screen milestone2018 Continued expansion of cinemas in Saudi Arabia with the openingof 78 new screens across 7 sites L&E introduced the first Dreamscape experience in the Middle East20198711320182019Cinema screens added146Total cinema screens511143Total L&E venues1 AS17AT FEBRUARY 2020
Financing Overview
GROUP DEBT PROFILE (1/2)All Senior Unsecured financing obligationsrank pari passu among themselvesDebt Maturity Profile (USD mn)2000Capital MarketsBank DebtMajid Al Futtaim Group’sBalanced Funding Profile(USD bn)160010812001088400211,2002.0Primarily Senior Unsecuredobligations at Holding levelMajid Al Futtaim Properties1.7Primarily Senior Unsecuredobligations at PropertieslevelOthers0.2Primarily project finance withlimited recourse to 5NotesMajid Al Futtaim Holding20800031 December20192026 Majid Al Futtaim HoldingCross guaranteesMajid Al Futtaim Properties 1.2bn 2.6bn 200mn5.9 yrsIssued two 10 yearGreen SukuksUndrawn AvailableCommitted LinesRefinanced EGP Al Maza project financewith new senior unsecured term loanWeighted AverageDebt Life1USD 0.9BN EQUITY HYBRIDS NOT TAKEN INTO ACCOUNT IN DEBT AND AVERAGE DEBT LIFE CALCULATIONS119
GROUP DEBT PROFILE (1/2)Facilities & liquidityStrong Leverage Metrics2019 includes impact of ,8042,6121,23121,4581,0001Debt Capital Markets Issuances% bnBonds12%0.8Sukuk26%1.7Total Debt Capital Markets Issuances38%2.5% bnDrawn22%1.4Undrawn40%2.6Total62%4.0Total Bank Commitments & Debt Capital Markets100%6.5Bank FacilitiesLess Drawn5000020152016EBITDA2017Net Debt (USD mn)Funding Risk Management FrameworkLiquidity Coverage - Months20182019(3.9)Plus Cash0.4Total Liquidity3.0Net Debt / EBITDA (times)31 Dec 31 DecPolicy/Covenant 2018 2019Investment grade credit ratings31 Dec201831 Dec2019184952FitchBBBBBB0.5-3.52.32.8Standard & Poor’sBBBBBBEBITDA Interest Cover (x) 1 2.08x9xTotal Net Debt to Total Equity (x) 0.70.40.4EBITDA from encumbered assets as % of totalEBITDA4%1%Secured debt as a percentage of Gross Debt8%1%Interest Rate Risk - Duration in Years¹ EBITDA INTEREST COVER MEANS EBITDA OVER NET FINANCE CHARGES (EXCL IFRS 16 IMPACT)20
MEASURED GROWTH & STEADY DEVELOPMENT PIPELINETRUE TO OUR COMMITMENT TO OUR CREDIT RATING, OUR TOP-DOWN CAPITALALLOCATION APPROACH IS MANAGED WITHIN THE DEBT CAPACITY OF THE “BBB”METRICS AND WITH AN EYE ON PRUDENT FINANCIAL MANAGEMENTMALL DEVELOPMENT PIPELINEUAERETAIL AND CINEMA PIPEINECITY CENTRE AL ZAHIASUPER REGIONAL MALL (SHARJAH)GLA: 136,000 M22020MALL OF OMANOMANKSASUPER REGIONAL MALL (MUSCAT, OMAN)GLA: 142,000 M2MALL OF SAUDISTORESCINEMASCREENSUAE632KSA587EGYPT10-OTHERS 120 -SUPER REGIONAL MALL (NORTH RIYADH)GLA: 321,000 M2¹ OTHERS INCLUDES OMAN, JORDAN, GEORGIA,PAKISTAN, KENYA, UGANDA, UZBEKISTAN21
IN SUMMARY Strong balance sheet Stable cash flow generation Best in class corporate governance Established track record, reputation & brand Diversified sources of fundingA strongfoundationFocused onsustainable growth Focus on diversification Cost optimization and operating efficiencies Business performance managementAppropriatelymanaging the risks Top down capital allocation Stress testing Country risk management Defined policies & procedures22
CONTENTSTABLE OF CONTENTSMajid Al Futtaim 2019 Performance UpdateAppendix Majid Al Futtaim Group Overview23
MAJID AL FUTTAIM GROUP OVERVIEW (1/2)GROUP CORPORATE STRUCTURESOLID TRACK RECORDMR. MAJID AL FUTTAIM(FOUNDER)99.6%Majid Al Futtaim HoldingLLC Consolidated Financials (USDmn)MR. TARIQ AL FUTTAIMRevenue0.4%MAJID AL FUTTAIM CAPITAL LLCMAJID AL FUTTAIM HOLDING7,445(RATED BBB/BBB)MAJID AL FUTTAIMMAJID AL FUTTAIMMAJID AL ourCinemasGourmet Gulf(JV)HotelsL&EEnova (JV)CommunitiesFashionProject ManagementFinance10442015REGIONAL 5731,2531,26120182019BEST IN CLASS GOVERNANCE PRINCIPLES16countries1 Voluntarily adopted the principles of the Combined Code on Corporate Governance for listedcompanies in the UK Strong operating company board structures reporting to a group boardsince 1992HIGHEST RATED PRIVATELY OWNED CORPORATE IN THE GCCRating Agency1Majid Al Futtaim Retail closed their hypermarketin Kazakhstan on 30 June 2017but continue to retain the country head office24RatingOutlookLatest Affirmation DateStandard & Poor’sBBBStableJuly 2019Fitch RatingsBBBStableNov 2019
MAJID AL FUTTAIM GROUP OVERVIEW (2/2)SOLID FINANCIAL PERFORMANCE ON THE BACK OF A MANAGED GROWTH STRATEGYFINANCIAL HIGHLIGHTSMAJID AL FUTTAIM PROPERTIES (USDmn)Majid Al Futtaim has a proven track record of delivering strongfinancial results on the back of an effective growth 7667101,256MAJID AL FUTTAIM HOLDING LLC CONSOLIDATED FINANCIALS 201565%Revenue7,0496,5036,011EBITDA MARGIN BY ENTITY (%)63%20172019MAJID AL FUTTAIM RETAIL (USDmn)The Group’s ability to combine capital intensive high margin business(shopping malls) with capital light, high volume business (hypermarkets)allows it to effectively manage its 20182019MAJID AL FUTTAIM VENTURES %5%5%5.1%2017MAF 16MAF Properties2019MAF Ventures2015252016201720182019
BUSINESS OVERVIEW: MAJID AL FUTTAIM PROPERTIESGROUP’S CORE BUSINESSMAJID AL FUTTAIM PROPERTIES’ KEY STRENGTHSOVERVIEW OF MAJID AL FUTTAIM PROPERTIES26OVER 1.5MILLION SQMALLIANCES ANDPARTNERSHIPSWITH KEY RETAILERSSHOPPING MALLSSUCCESSFULLYOPERATINGESTABLISHED TRACKRECORD, REPUTATION& BRANDUNIQUE LEISUREOFFERS(Through Majid Al Futtaim Ventures)IN 5 COINTRIES ACROSS THE MIDDLEEASTAND NORTH AFRICAIN THEDEVELOPMENTPIPELINE IN 3COUNTRIESACROSS THEREGIONMILLION SQM OFGLA OF PRIMERETAIL SPACEAND EXPANDING200MILLIONPRIME LOCATIONSSECUREDFOR BUSINESSIN-HOUSE EXPERTISE(FULLY INTEGRATEDOPERATIONS)3 NEW PROJECTSOVER 1.513 Hotels11 in UAE2 in BahrainMAJID AL FUTTAIMPROPERTIES1801501209060300VISITORS ANDGROWINGANNUALLY ACROSSALL OF OUR 186192200201620172018201950%0%Total Shopping Mall Footfall - MillionHotels Occupancy2695%Shopping Mall Occupancy
MAJID AL FUTTAIM PROPERTIES (1/2)City Centre DeiraOpened: 1995 , 117k m2 GLAOccupancy Rate : 96%City Centre Me’aisemOpened: 2015 , 23k m2 GLAOccupancy Rate : 92%City Centre SharjahOpened: 2001 , 51k m2 GLAOccupancy Rate : 99%City Centre AjmanOpened: 1998 , 55k m2 GLAOccupancy Rate : 97%City Centre FujairahOpened: 2012 , 35k m2 GLAOccupancy Rate : 96%My City Centre Al BarshaOpened: 2016 , 4k m2 GLAOccupancy Rate : 86%My City Centre Al DhaitOpened: 2018 , 5k m2 GLAOccupancy Rate : 71%My City Centre MasdarOpened: 2019 , 18k m2 GLAOccupancy Rate : 77%City Centre MirdiffOpened: 2010 , 203k m2 GLAOccupancy Rate : 92%City Centre Al ShindaghaOpened: 2016 , 25k m2 GLAOccupancy Rate : 92%My City Centre NasseriyaOpened: 2014 , 5k m2 GLAOccupancy Rate : 77%UAEMall of the EmiratesOpened: 2005 , 255k m2 GLAOccupancy Rate : 94%27
EGYPTMAJID AL FUTTAIM PROPERTIES (2/2)City Centre AlexandriaOpened: 2003 , 64k m2 GLAOccupancy Rate : 95%Mall of EgyptOpened: 2017 , 162k m2 GLAOccupancy Rate : 93%City Centre Al MazaOpened: 2019 , 102k m2 GLAOccupancy Rate : 83%My City Centre SurOpened: 2018 , 16k m2 GLAOccupancy Rate : 93%City Centre SuharOpened: 2019 , 35k m2 GLAOccupancy Rate : 87%OMANCity Centre MaadiOpened: 2002 , 30k m2 GLAOccupancy Rate : 99%LEBANONCity Centre QurumOpened: 2005 , 27k m2 GLAOccupancy Rate : 99%BAHRAINCity Centre MuscatOpened: 2001 , 69k m2 GLAOccupancy Rate : 100%City Centre BahrainOpened: 2008 , 160k m2 GLAOccupancy Rate : 96%28City Centre BeirutOpened: 2013 , 63k m2 GLAOccupancy Rate : 92%
BUSINESS OVERVIEW: MAJID AL FUTTAIM RETAILGENERATING STEADY CASHFLOWS306CarrefourOutletsOVERVIEW OF MAJID AL FUTTAIM RETAILNorth Africa and CIS RegionsOPERATING FRAMEWORKMajid Al Futtaim Retail aims to capitalize on its strong supply chainand procurement procedures to deliver value to its customers.Over45New storesplanned in2020SalesVolumeIn 15 countries Across the Middle East,ExclusiveFranchiseRights for37CountriesReinvestRebatesAcross the Middle East,North Africa and CIS RegionsPurchasingPowerSupplierRebatesMajid Al Futtaim Hypermarkets is a wholly owned subsidiarysince 25 June 2013 when Majid Al Futtaim acquired the remaining25% from Carrefour SA. As part of the transaction, Majid Al Futtaimalso renewed its exclusive franchise partnership with the Carrefourgroup until 2025 and extended it to an additional 19 new countries.Low PricesCarrefour charges a sale-based franchise fee and providesapproval on new store openings.29Good QualityWide Choices
MAJID AL FUTTAIM istanKuwaitEgyptSaudi ArabiaBahrainQatarUAEOmanUgandaKenya130Majid Al Futtaim Retail closed their hypermarketin Kazakhstan on 30 June 2017but continue to retain the country head office
BUSINESS OVERVIEW: MAJID AL FUTTAIM VENTURESCOMPLEMENTARY BUSINESSESMajid Al Futtaim Ventures builds and manages value enhancing businesses for the Majid Al Futtaim Group, focusing on selectedsectors that are relevant for the wider business in the region.WHOLLY-OWNED COMPANIESMajid Al Futtaim Leisure & Entertainment LLCMajid Al Futtaim Cinemas LLCProvides unique leisure offerings to Majid Al Futtaim malls511Majid Al Futtaim Finance LLCMajid Al Futtaim Fashion LLCCredit Card Issuer BusinessIntroduced VisaCards in 2010Cinema ScreensAcross the MENARegion95Over 143KCards in ForceJOINT VENTURE COMPANIESJV providing Energy Services and FacilitiesManagement Formed in 2002 (as Dalkia)31Stores in7Countries
ROBUST GOVERNANCE STRUCTUREGOVERNANCE PRINCIPLES Majid Al Futtaim places considerable emphasis on governance and transparency within its operational framework.The company has voluntarily adopted the principles of the Combined Code on Corporate Governance for listed companies in the UKacross all areas of its businessStrong operating company Board structures reporting to a group BoardSet out the principles of Corporate Governance across each of the group’s operating entities and geographies Majid Al Futtaim has obtained a Strong management & governance (M&G) score by S&P across its universe of rated entities in theGulf region – one of the two only entities that such score has been awardedBOARD RESPONSIBILITIESMajid Al Futtaim Holding BoardThe Board of Majid Al Futtaim Holding provides independent oversight to protect shareholders’ interests:1) Acting as shareholder of operating companies;2) Controlling decisions related to strategic new businesses / markets or divestments; and3) Via managing Funding and Capital allocationOperating Companies BoardsEach operating company maintains its own Board of Directors responsible for setting strategic goals, measurement of the success ofthe businesses in achieving objectives and maintaining corporate accountability. Chairmen of the Operating Company boards aremembers of the Holding Board of Directors32
MAJID AL FUTTAIM HOLDING BOARD OF DIRECTORSSir Michael RakeSir Ian DavisTariq Al FuttaimAlan KeirChairmanNon-Executive DirectorNon-Executive DirectorNon-Executive DirectorChairman of Phoenix Global Servicesand Wireless Logic GroupFormer Chairman of BT Group andKPMG InternationalChairman of Rolls Royce andformerWorldwide Managing Director atMcKinsey & CompanyFormer chairman of the Majid AlFuttaim Charity FoundationNon Executive Director at HSBCUK Bank PlcNon Executive Director at SumitomoMitsui Banking CorporationVictor ChuLord RoseLuc VandeveldePhilip BowmanAlain BejjaniNon-Executive DirectorNon-Executive DirectorNon-Executive DirectorNon-Executive DirectorChairman of FirstEasternInvestment GroupCo-founder and director of PeachAviationChairman of Ocado andNon Executive Director of WoolworthsHolding LimitedFormer CEO of Marks and Spencer plcFounder and Chairman of ChangeCapital Partners LLPFormer Chairman of the CarrefourGroup and Mark and SpencerIndependent Director of FerrovialS.AFormer Chief Executive of SmithsGroup plc and Director of BurberryGroupChief Executive Officer ofMajid Al FuttaimHolding33Former Executive Vice-Chairmanofthe Investment DevelopmentAuthority of Lebanon
Total Bank Commitments & Debt Capital Markets 100% 6.5 Less Drawn (3.9) Plus Cash 0.4 Total Liquidity 3.0 Investment grade creditratings 31Dec 2018 31Dec 2019 . (MUSCAT, OMAN) GLA: 142,000 M2 MALL OF SAUDI SUPER REGIONAL MALL (NORTH RIYADH) GLA: 321,000 M2 OMAN MALL DEVELOPMENT PIPELINE RETAIL AND CINEMA PIPEINE 2020 STORES CINEMA
