ARS million

IIQ 2016 Conference Call
February 17, 2016
Llao Llao Resort – Bariloche (Rio Negro – Argentina)
Hosted by:
Alejandro G. Elsztain, IIVP
Daniel R. Elsztain, COO
Matías I. Gaivironsky, CFO
1
Main Highlights for 6M 2016 – Consolidated Basis
o On October 11, the Group took control of IDB Development Corp and started
consolidating IDBD Assets & Liabilities. Results will be consolidated next quarter IIIQ16
Financial Consolidated Results 6M16
oRevenues from Sales, Leases & Services*: ARS 1,570 million (+24.7% vs. 6M15)
o EBITDA**: ARS 2,054 million (+15% vs. 6M15)
o Net Income: Loss of ARS 910.0 million (Loss of ARS 487 million to IRSA Shareholders)
(mainly due to a decrease in the stock price of IDBD’ Insurance company Clal, lower
financial results and higher exchange rate differences)
o We hedged part of our USD denominated debt to avoid higher losses from the currency
devaluation - Positive Results of ARS 911 million in 6M16
* Revenues from Sales, Leases & Services (does not include revenues from expenses and common advertising)
**EBITDA = Operating Result + D&A
2
2
Main Highlights for 6M 2016
o EBITDA Malls 6M16: ARS 938.7 millon (+36.4% vs 6M15)
o EBITDA Offices* 6M16: ARS 87.3 million (+309.7% vs 6M15)
o Malls’ Tenant Sales increased by 39.5% in 6M16 (+32.0% same stores sales)
o Office Leases remained stable at USD/sqm 25.6
o Gain on Sale of Investment Properties for ARS 155.9 MM (5,963 sqm of Intercontinental Plaza Building)
o Additional partial sale of 851 sqm of Intercontinental Plaza in February 2016 for ARS 41.5 million.
Gain of ~ ARS 19.8 million to be recognized next quarter
o Occupancy stood at high levels: 99.0% in shopping malls & 94.0% in offices
o We will make a separate webcast for IRSA Commercial Properties since next quarter IIIQ16
o IRSA sold during the quarter 0.7% of IRSA Commercial Properties reducing stake from 95.90% to 95.22%
o Sales of Investment Properties for ARS 808 million generating a Gain of ARS 729 million
o Partial Sale of Catalinas Office to be built (4 floors + 44 parking lots) for ARS 180.3 million + USD 12.3 million
o Investment in Banco Hipotecario (29,94% stake) generated a gain of ARS 169.8 million (+ 141% vs 6M15)
o Investment in IDBD:
In October 2015, Extra Holding Limited soldits investment. IFISA was the buyer increasing stake to
31%. IRSA remained with 49% through Dolphin. Effective control since then.
As a subsequent event, Dolphin signed with IFISA an option to acquire 92.6 million shares of
IDBD at NIS 1.64 per share in a 2 year period + 8,5% annual interest rate
3
*EBITDA = Operating Result + D&A excluding one shot tax expenses of the transference of assets
Management Roadshow
CONFIDENTIAL | June 2015
4
Shopping Centers: Strong Operating Figures
Shopping Centers – Tenants’ Sales
(Quarterly Growth Rate - %)
44,5%
35,6%
30,5%
28,9%
24,9%
26,0%
22,1%
24,1%
26,3%
28,5%
28,6%
29,9%
30,0%
35,4%
31,3%
27,1%
36,3%
30,1%
35,7%
32,5%
Same Store Sales
dic-11
ene-12
feb-12
mar-12
abr-12
may-12
jun-12
jul-12
ago-12
sep-12
oct-12
nov-12
dic-12
ene-13
feb-13
mar-13
abr-13
may-13
jun-13
jul-13
ago-13
sep-13
oct-13
nov-13
dic-13
ene-14
feb-14
mar-14
abr-14
may-14
jun-14
jul-14
ago-14
sep-14
oct-14
nov-14
dic-14
ene-15
feb-15
mar-15
abr-15
may-15
jun-15
jul-15
ago-15
sep-15
oct-15
nov-15
dic-15
Tenant Sales
34,3%
Shopping Centers – Occupancy %
Summary Main Figures
(6M 2016)
96,5%
98,5%
98,7%
98,9%
99,0%
Stock (sqm)
Occupancy
Sales (ARS)
Visitors
6M 15
9M 15
FY 15
3M 16
6M 16
5
A+ Office Industry Outlook & IRCP main figures
A+ Office Market BA – Sale Prices
(USD/sqm)
6.153
5.898
5.733
5.630
Parcial Sales of Intercontinental Plaza
4.500
3.700
3.800
3.500
3.100
September 2015
Operating Figures IIQ16
2.800
Stock: 79,945 sqm
2.570
2.280
2.060 2.110
1.800
Monthly Lease
Occupancy %
(USD/sqm)
1.600
25.6
94.0%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015e




Partial Sale for ARS 324,0 mm
5,963 sqm sold
(7 floors + 56 parking lots)
USD/sqm 5,800 – 5.2% Cap Rate
Gain recognition: ARS 155.9 million
February 2016 (Subsequent Event)




Partial Sale for ARS 41.5 mm
851 sqm sold (1 floor + 8 parkings)
Gain recognition; ARS 19.8 million
(next quarter)
Remaining sqm: 6,308
Source: L.J. Ramos
6
Development of existing malls
Distrito Arcos (BA City) – 2nd Phase and Alto Rosario (Santa Fe)
2nd Phase Development
Expansion Project
o Expansion of 3,564 sqm of GLA
o Expansion of 650 sqm of GLA
o Capex: ~ ARS 74 million
o Capex: ~ ARS 15 million
o Development Period: (May-15 to Mar-16)
o Development Period: (Sep-15 to Mar-16)
o Development Progress: 96%
o Development Progress: 65%
o Agreements signed: 60%
o Agreements signed: 100%
o New Tenants: Farmacity, Akiabara, Wendy’s & Megatlon
oNew Tenants: Musimundo, Kevingston & Le-Paine
UNDER DEVELOPMENT
Oct-2015: Opening of Museum FOLA – Fototeca latinoamericana
UNDER DEVELOPMENT
7
Capex 2017/2018: 1st Stage MIXED USE “POLO DOT” PROJECT
Adjoining DOT Plot of Land 1
(1st stage) ~ 28,000 sqm GLA
Capex: ~ USD 50 million
Adjoining DOT Plot of Land 2
Two Office Towers / hotels – 2nd Stage ~ 38,400 sqm
2nd Stage
Dot Building
POLO DOT
FULL 5 YRS PROJECT
~ 66,400 leasable sqm
Dot Baires Mall
1st Stage
2017/2018
~ USD 50 MM
2nd Stage
8
Capex 2017/2018: Current Malls’ Expansions
Alto Palermo Lindero Project
Food Court moving to new 3rd level
~ 4,000 sqm new GLA
Investment: ~ USD 12 million
9
10
10
Sales of Investment Properties 6M 2016
“Dique IV” Office
“Maipú 1300” Office
Isla Sirgadero Plot
(Puerto Madero - BA)
(Retiro – BA)
(Santa Fe Province)
Total
Partial
11,242 sqm
ARS
million
Total
3,451 sqm
826 ha
649
587
9.5x BV
123
62
8.5x BV
110
13
Profit
37
32
4
7.7x
BV
BV
11
Partial Sale of Catalinas Office Building (to be built)
~ 35,000 sqm of GLA
Green Building
30 floors, parking and amenities
• 4,896 sqm sold at ARS 180 MM + USD 12 MM
USD/smq ~ 5,000 to deliver in 4y
Solares de Santa María – Mix Uses
Espacio Aéreo COTO
Residential
Laguna Carrasco - Residential
International Opportunistic Investments
Lisptick Building
Condor Hospitality Trust
(Nasdaq: CDOR) – 34% Voting Power
Supertel
Hospitality Inc.
(SPPR:Nasdaq)
Renamed
Condor
Hospitality Trust.
New Ticker in Nasdaq: CDOR
New Management appointed (CEO, CFO & CAO)
New Strategy: Selective hotel sales to achieve
better margin & scale hotels
Lipstick Operating Figures
Leases USD/sqm & Occupancy
95,1%
91,9%
88,9%
65,3
64,7
63,7
FY2014
FY2015
Rent (USD / sqm)
6M16
Occupancy
13
International:
Investment
in Appreciation
IDBD
Urban Real Estate
15 years
Investment Highlights – 6M 2016
 On October 2015, IFISA acquired Extra’ stake
increasing to 31.7% its stake in IDBD. Dolphin
Ownership Structure
Dolphin
49.00%
IFISA
31.70%
Others
19.30%
remained with 49%.
 During December 2015, we agreed to pospone
the launching of the 1st tender offer to March
2016.
 We have appointed an acting CEO for IDBD and
DIC and a new CFO for DIC.
Investment made & Future Commitments
 During December 2015, the sale process of Clal
was cancelled
Amount
 As a subsequent event, Dolphin signed with IFISA
an option to acquire 92.6 million shares of IDBD at
NIS 1.64 per share in a 2 year period + 8,5%
annual interest rate
Amount invested by IRSA in Dolphin
~ USD 350 million
Obligations
Tender Offer March 2016
NIS 257 million
Tender Offer December 2016
NIS 262 million
 100% Tender offer obligation recorded as of dec15: ARS 1,653 million
14
Financial Results
15
IDBD Consolidation – Timeline
o On October 11, 2015 the Group controlled by Eduardo S. Elsztain took effective
control of IDB Development Corp; and as such IRSA started consolidating IDBD as of
this date.
o IRSA’s IIQ16 Financial Statements, released on February 11, 2016 consolidates IDBD
Assets and Liabilities as of the date the effective control was gained.
o IDBD Results will be consolidated on IRSA’s Financial Statements with a three month
lag, starting as from the IIIQ16
June 30
2015
September 30
2015
Annual and Last quarter Results
(Non consolidation due to lack of control)
October 11
2015
December 31
2015
Effective Control
Assets & Liabilities
IDBD Consolidation
March 31
2016
Results
IDBD Consolidation
16
IDBD Consolidation – Financial Statement Exposure
o We divided the operations in two Business Centers: Argentina & Israel
o All the information of IRSA’s operations in Argentina will be disclosed separately from the
operations of IDBD (Israel)
IRSA Inversiones y
Representaciones Sociedad
Anónima
Argentina Business Center
IRSA Propiedades
Comerciales S.A.
Nuevas Fronteras
S.A.
Llao Llao Resorts
S.A.
New Lipstick LLC
(i)
Condor
Hospitality
Trust (i)
Banco
Hipotecario
S.A. (i)
Israel Business Center
IDB Development
Corporation Ltd.
IDB Group
Investment Inc.
IDB Tourism
(2009) Ltd.
Discount
Investment
Corporation Ltd.
CLAL Insurance
Enterprices Ltd. (i)
Property & Building
Corp.
Shufersal Ltd.
Adama
Agricultural
Solutions Ltd. (i)
Cellcom Israel
Ltd.
Elron Electronic
Industries Ltd.
17
(i) Companies not consolidated (registered as equity investees)
17
IDBD Consolidation: Segment information
o Segments
of IRSA will look separately as follows…
ARGENTINA
Business Center
Shopping
Office
Sales &
Centers
and Others
Development
Hotels
Segments of IRSA’s operations from
Argentina looks the same than before
consolidation
International
Financial &
Others
ISRAEL
Business Center
Real Estate
Supermarkets Agrochemicals Telecommunications
Insurance
Others
18
18
IRSA’s Consolidated Balance Sheet IIQ 2016
Assets
Liabilities
122
En ARS Bn
129
~ 17x
~13x
IDBD debt non
recourse to IRSA
10
7
Assets (BV)
Debt (IBL)
Solares de Santa María – Mix Uses
o Research Analysts’ NAV Calculation states that IDBD investment represents ~ 10% of IRSA’s
Assets at Market Value and agrees that this consolidation is just an accounting matter
19
Financial Overview
Revenues by Segment
EBITDA* & EBITDA Mg by Segment
(ARS million)
+37,7%
ARS million
+370,7%
+36,4%
+309,9%
1,193.5
938.7
866.6
688.1
112.5
21.3
23.9
Shopping Centers
Offices
6M15
Shopping Centers
6M16
Shoppings*
Offices*
IIQ 16
78.7%
77.6%
IIQ 15
79.4%
89.1%
var YoY
-0.7 pp
Offices
6M15
EBITDA Margin by Segment - %
-11.5pp
87.3
6M16
EBITDA Breakdown - %
0,0%
11,2%
7,6%
Shopping Centers
Offices
S&D
81,3%
Financial and
others
 In November IRSA CP distributed dividends for a total amount of ARS 283 million (div yield 2.4%)
•EBITDA = Operating Income + D&A, excluding transference of assets taxes
20
Consolidated Operating Income by Segment 6M16
Rental Segment
Sales & Development
Financial & Others
(ARS million)
(ARS million)
(ARS million)
+21%
+47%
933,0
937,0
774,0
635,0
187
-52%
89
6M 15
6M 16
6M 15
6M 16
6M15
6M16
21
Consolidated Financial Results 6M 2016
Consolidated Financial Results
(ARS million)
1,948
1,586
47
-681
Operating Income
-398
Results of associates and
joint ventures
-379
-479
Controlling shareholders
-236
-910
-2,224
Net Financial Results
6M 15
6M 16
Net Financial Results
Main Effects – 6M 2016
 Net FX Losses: ARS 397.6 MM
Income Tax
Non-controling intereset
-487
-423
Net Result
Exchange Rate Evolution
(ARS/USD)
6M16
+43,5%
6M15
+5,1%
 FV of CLAL: Loss of ARS 797.5 MM
Other FV of financial assets: Loss of ARS 178.5 MM
 Net Financial Costs: Loss of ARS 453.3 MM
FX Losses: ARS 1,620 MM
Hedge Gain: ARS 911 MM
FX Gain: ARS 311 MM
Net FX Losses: ARS 397.6 MM
 Change in valuation method of IDBD and tender offers: Loss of ARS 389 MM
22
IRSA’s consolidated debt as of December 31, 2015
IRSA Stand Alone
Debt amortization schedule
USD million
90,0
150,0
108,8
Debt: USD 109.9 MM + USD 300 MM (Bonds)
Cash & Equivalents: USD 62.6 MM
IRSA CP credit for USD 240.0 MM
Debt Repurchase: USD 3.5 MM
Net Debt: USD 103.8 MM
60,0
2016
1,1
2017
2018
2019
2020
IRSA Commercial Properties Stand Alone
Debt amortization schedule
USD million
Debt: USD 406.5 MM
Cash & Equivalents: USD 155.9 MM
Debt Repurchase: USD 1.7 MM
Net Debt: USD 248.9 MM
Net Debt/EBITDA*: 1.1x
150,0
90,0
2016
2017
2018
2019
2020
23
Contact Information
ALEJANDRO ELSZTAIN – II VP
MATÍAS GAIVIRONSKY– CFO
Tel +(54 11) 4323 7449
Corporate Offices
Intercontinental Plaza
Moreno 877 24° Floor
Tel +(54 11) 4323 7400
Fax +(54 11) 4323 7480
C1091AAQ – City of Buenos Aires – Argentina
NYSE Symbol: IRS
BASE Symbol: IRSA
www.irsa.com.ar
Follow us on Twitter
@irsair
Independent Auditors
PricewaterhouseCoopers
Argentina
Tel +(54 11) 4850 0000
Bouchard 557 7º
C1106ABG – City of Buenos Aires
Argentina
Cautionary Statement
Investing in all equities, including natural resources and real estate-related equities, carries risks which should be
taken into consideration when making an investment.
This institutional presentation contains statements that constitute forward-looking statements, in that they include
statements regarding the intent, belief or current expectations of our directors and officers with respect to our
future operating performance. You should be aware that any such forward looking statements are no guarantees
of future performance and may involve risks and uncertainties, and that actual results may differ materially and
adversely from those set forth in this presentation. We undertake no obligation to release publicly any revisions to
such forward-looking statements to reflect later events or circumstances or to reflect the occurrence of
unanticipated events.
Additional information concerning factors that could cause actual results to differ materially from those in the
forward-looking statements can be found in the companies’ Forms 20-F for Fiscal Year 2015 ended June 30, 2015,
which are available for you in our web sites.