Consolidated Results Report
1Q 2015
April 28, 2015
Consolidated Results Report - 1Q2015
Third Quarter of 2014
Executive Summary
 The Group achieved Revenues of S/. 1,703.0 MM during 1Q2015, a 11.9% growth compared to 1Q2014
 Gross Profit amounted to S/. 173.5 MM in 1Q2015, decreasing 23.5% compared to 1Q2014
 EBITDA was S/.162.4 MM in 1Q2015, lower by 25.8% than the result obtained in 1Q2014
 Net Income registered a decrease of 75.2%, reaching S/. 17.9 MM in 1Q2015
 Backlog amounted to US$ 3,461.2 MM as of 1Q2015, equivalent to 1.55x the annual revenues, and the recurrent businesses amounted to US$ 500.1 MM, reaching a total of US$ 3,961.3 MM
 An Action Plan has been elaborated in order to improve profitability of the Business Areas and strengthen the financial position of the Group. This is included in the Appendix (page 9)
CONSOLIDATED QUARTERLY CUMULATIVE REVENUES
(S/. MM)
REVENUES BY SEGMENT
as of 1Q2015
Page 2
EBITDA BY SEGMENT
as of 1Q2015
NET INCOME BY SEGMENT
as of 1Q2015
Consolidated Results Report - 1Q2015
Third Quarter of 2014
Consolidated Results
Revenues.
Consolidated revenues reached S/. 1,703.0 MM during 1Q2015, an increase of 11.9% compared
to 1Q2014.
In terms of Business Segments, revenues in the Engineering and Construction segment increased
18.6% in 1Q2015, contributing with 73.6% of the Group’s revenues. The Infrastructure Segment
increased in 22.3%, due mainly to an increase in the revenues of Norvial and GyM Ferrovías,
while the Real Estate Area registered a decrease of 55.7% due to a reduction in the housing units
delivered. Finally, the Technical Services Segment registered a 1.3% revenue decrease in
1Q2015.
Gross Profit.
Consolidated Gross Profit decreased from S/. 226.8 MM to S/. 173.5 MM, equivalent to a decrease of 23.5% and a Gross Margin of 10.2% in 1Q2015. The decrease in Gross Margin is mainly
explained by lower results in Engineering and Construction as a consequence of the loss reported in Inmaculada Project. On the other hand, the economy slowdown has impacted the sales’
speed in the Real Estate Area and therefore this has affected the amount of units delivered;
whilst the fall in oil price has impacted the Infrastructure segment. In the Technical Services,
there is a recovery compared to the same period of the previous year due to the recovery in the
results of Concar.
Operating Income.
Additionally to the Gross Profit variation, the Operating Income variation is explained by the
higher general expenses, due mainly to the Technical Services segment and to lower result in
other operational expenses as a consequence of the execution of the letter of credit issued by
the consortium formed for the EPCM for Minera Panamá.
The increase in Financial expense is a consequence of the increase of the working capital debt in
the Engineering and Construction Area, as well as in the Real Estate Area.
The “Participation in Associates” account registers the profit generated in projects where Vial y
Vives - DSD, Viva GyM and CAM have minority participation and are not consolidated.
Exchange rate difference.
During 1Q2015, the Nuevo Sol depreciated against the US Dollar, from S/. 2.989 per dollar as of
December 31, 2014, to S/. 3.097 per dollar as of March 31, 2015; while the Chilean Peso, experienced a devaluation from 606.75 to 626.87 Pesos per dollar generating a greater impact on
exchange rate differences in the quarter due to higher liabilities in US Dollars.
Net Income.
Consolidated Net Income was S/. 17.6 MM in 1Q2015, equivalent to a 75.2% reduction compared to 1Q2014.
EBITDA.
Consolidated EBITDA was S/. 162.4 MM in 1Q2015, which represents a decrease of 25.8% compared to 1Q2014, explained by the operating results. EBITDA Margin in 1Q2015 was 9.5%, lower
than the one reported in 1Q2014.
A further detail of the results is described in the each of the business segments sections.
Stable Cash Flows.
Regarding stable long term cash flows, during 1Q2015, 54.5% of the consolidated EBITDA was originated from Stable Cash Flows businesses. The EBITDA generated from these
businesses allows us to cover the Interest Expenses and General Expenses of the company businesses that not generate cash flows in 0.7 times.
Page 3
Consolidated Results Report - 1Q2015
Third Quarter of 2014
Consolidated Results
Backlog.
Consolidated Backlog (US$ 3,461.2 MM) and recurrent businesses (US$ 500.1
MM) reached a total amount of US$ 3,961.3 MM in 1Q2015.
Consolidated Backlog
(US$ MM)
From the total consolidated Backlog of 2015, US$ 1,498.7 MM will be executed during 2015, US$ 1,005.1 MM in 2016, and the remaining in 2017 and the
following years.
The recurrent businesses are the Oil and Gas segment and the Norvial toll road
are businesses.
For further detail of the backlog, please go to the appendix page.
Backlog by Segment
Backlog by Sector
Backlog by Type of Client
Backlog by Geography
Capital Expenditures.
Capital Expenditures (CAPEX) in 1Q2015 amounted to S/. 97.2 MM (US$ 31.4 MM). The CAPEX distribution per Business Segment is as follows: Infrastructure represents 57%,
Engineering and Construction represents 27%, followed by Technical Services (14%) and finally Real Estate (2%).
Indebtedness.
Consolidated Financial Gross Debt amounted to S/. 2,154.7 MM (US$ 695.7MM) for 1Q2015. The increase in debt compared to the closing of 2014, is explained by the bond
issuance for the Line 1 of the Lima Metro for a total amount of S/. 629.0 MM; as well as to an increase in working capital mainly in the Engineering & Construction Segment.
Maturity of Financial Debt
Financial Indicators
 In terms of tenor, 57.2% of the consolidated financial debt (S/. 2,154.7 MM), corresponds to short-term financial obligations and the remaining (S/. 925.7 MM) corresponds to long-term financial obligations.
 In terms of currency, 57.3% of the consolidated financial debt is denominated in Nuevos Soles and 37.3% in Dollars, while the balance is denominated in other currencies
corresponding to our foreign subsidiaries.
Consolidated leverage, measured through the Gross Financial Debt/Equity, reached 0.7x , while the Gross Financial Debt/EBITDA reached 2.5x in 2014. It’s worth mentioning
that the total Available Cash is S/. 1,016.1 MM as of 1Q2015.
Page 4
Consolidated Results Report - 1Q2015
Third Quarter of 2014
Engineering and Construction
The Engineering & Construction Area reached a 18.6% revenue growth in 1Q2015, compared to the
amount reported in 1Q2014, mainly due to higher revenues in GyM in its different divisions, and also
due to revenues from Morelco, which is a Colombian company acquired in December 2014.
Gross Profit decreased 24.5% in 1Q2015 compared to 1Q2014. Gross Margin decreased from 12.8% to
8.1%. This was because of lower margins in the civil works and electromechanical divisions, due to the
loss generated by Inmaculada Project. Additionally, works under execution during this quarter in Vial y
Vives - DSD report lower margins than projects executed during the same period last year, which is
partially offset by the margin generated by ongoing projects of Morelco.
Operational Income decreased 61.0% mainly due to the explanation above and as a consequence of
the execution of the letter of credit to the consortium for the implementation of EPCM for Minera
Panamá registered in Other Operational Expenses.
Moreover, the Engineering and Construction segment registers the profit for the minority participation
Vial y Vives - DSD holds in several of its projects, as well as the minority participation of GyM in Viva
GyM in the line “Participation in Associates”.
Net Income in 1Q2015 was S/. 3.9 MM, which represents a Net Margin of 0.3%, lower compared to the
same period in 2014.
EBITDA was S/. 74.8 MM in 1Q2015, lower by 35.0% compared to 1Q2014, due to lower operational
income.
Capital Expenditures. Capital expenditures (CAPEX) for 1Q2015 amounted to S/. 26.9 MM (US$ 8.7
MM) , corresponding to the purchase of machinery for construction, and the purchase of mining equipment for the mining services contracts.
Revenues (Million of S/.)
Ebitda (Million of S/.)
Net Income (Million of S/.)
as of 1Q2015
as of 1Q2015
as of 1Q2015
+ 18.6%
-35.0%
-89.6%
Backlog. The Engineering and Construction segment reported a Backlog of US$ 2,570.4 MM as of 1Q2015, amount that is equivalent to a 9.3% reduction compared to the
amount registered at the end of 2014. The total Backlog will be executed as follows: US$ 1,162.0 MM in 2015, US$ 746.9 MM in 2016 and US$ 661.5 MM in the following
years.
Backlog (Million of US$)
as of 1Q2015
Page 5
Backlog by Type of Contract
Consolidated Results Report - 1Q2015
Third Quarter of 2014
Infrastructure
The Infrastructure Area reached revenues of S/. 203.3 million in 1Q2015, higher by 22.3% compared
to 1Q2014. This was mainly due to the increase in revenues of GyM Ferrovías, considering a quarter
with the total of trains in full operation, whilst in Survial it was due to an increase in maintenance
works. This was also a consequence of the registration of the work progress for the second stage of
the Norvial toll road and the construction of La Chira water treatment plant as revenues.
On the other hand, the decrease in revenues in GMP is explained by the decline in crude oil price
which registered an average price per basket of US$ 105.5 in 1Q2014 and US$ 52.27 per basket in
1Q2015. This was partially compensated by an increase in the level of daily barrels produced going
from 1,525 BPD in 1Q2014 to 1,617 BPD in 1Q2015, and also the processing levels at the Pariñas
Gas Plant increased from an average of 22.2 MMCF (million cubic feet) in 1Q2014 to 30.2 MMCF in
1Q2015.
Gross Profit decreased 35.6% mainly due to the decline in oil price. On the other hand, the accounting registration of advanced works in the construction of Norvial second stage as well as of La
Chira with lower margins, impacted the segment’s gross profit.
In 1Q2014, financial expenses were higher than the ones reported in 1Q2015, due to the registration of the expenses related to the pre payment of the long term debt Norvial owed to IDB and IFC.
This debt has been replaced with a short term bridge facility that will be repaid through a bond
issuance that will finance the second stage of the concession.
Additionally, during this quarter, a bond for S/. 629.0 MM for the Line 1 of the Lima Metro was
issued.
Net Income was S/. 12.5 million, which represents a decrease of 44.4%, explained in detail above.
Net Margin decreased from 13.5% in 1Q2014 to 6.1% in 1Q2015.
EBITDA for the 1Q2015 reached S/. 61.5 MM representing an EBITDA margin of 30.2%.
Revenues (Million of S/.)
Ebitda (Million of S/.)
Net Income (Million of S/.)
as of 1Q2015
as of 1Q2015
as of 1Q2015
+ 22.3%
- 18.1 %
- 44.4%
Capital Expenditures. Capital expenditures (CAPEX) for 1Q2015 amounted to a S/. 56.8 MM (US$ 18.3 MM) corresponding mainly to investments in GMP and to the construction of the extension of the Norvial toll road, as well as to the construction of La Chira water treatment plant.
Backlog.
Backlog (Million of US$)
The Infrastructure Area reported a Backlog of US$ 299.0 MM as of 1Q2015, and a as of 1Q2015
total of US$ 500.0 MM of recurrent businesses.
The total Backlog of the Infrastructure Segment will be executed as follows: US$
102.7 MM in 2015, US$ 84.4 MM in 2016 and US$ 111.9 MM in the following years.
Page 6
Consolidated Results Report - 1Q2015
Third Quarter of 2014
Real Estate
Real Estate Area registered revenues of S/. 23.8 MM in 1Q2015, a 55.7% decrease compared to
1Q2014 which is explained by the lower amount of units delivered in 1Q2015 (112 units) compared to the delivered housing units in 1Q2014 (226 units).
There are a total of 14 projects under development, within which the main ones are Parques del
Callao, Parques de San Martin de Porres, Parques de Villa El Salvador II, Parques de Carabayllo II,
Parque Comas, y Parques Naranjal. Moreover, a building in Pezet and other in Barranco are also
under execution, while the offices under construction are Real Ocho, Real Dos, Rivera Navarrete
and Panorama.
A total of 86% of the projects are been executed in Lima, whilst 14% of them are been executed
in other provinces of Peru.
Gross Profit decrease during 1Q2015 is explained by lower margins reported in the delivered
housing units, considering that during the 1Q2014 there was a higher delivery of units of affordable housing projects, whose margins were higher.
The Participation in Associates account includes the results of businesses where we hold a minority stake.
This first quarter of 2015 ends with a net loss of S/. 0.1 MM, which is explained by the lower
quantity of delivered units, as well as to a higher impact of exchange rate difference during this
quarter, as a consequence of liabilities in US Dollars.
EBITDA was S/. 10.5 MM in 1Q2015, which was lower in 11.3% compared to 1Q2014 reaching an
EBITDA Margin of 44.2%. The decrease in EBITDA is explained by the factors described above.
Revenues (Million of S/.)
Ebitda (Million of S/.)
Net Income (Million of S/.)
as of 1Q2015
as of 1Q2015
as of 1Q2015
- 55.7%
- 11.3%
- 119.1%
Capital Expenditures. Capital Expenditures (CAPEX) in 1Q2015 amounted to S/. 2.2 MM Backlog (Million of US$)
(US$ 0.7 MM), from which US$ 0.3 MM corresponds to Cuartel San Martin project and as of 1Q2015
US$ 0.4 MM to the remodeling of our main office.
Backlog.
The Real Estate Segment reported a Backlog of US$ 103.2 MM as of 1Q2015. The main
projects included in the Backlog are Parque Central, Los Parques de Piura, Los Parques
de San Martin de Porres, Parques de Comas, Real 8 offices (San Isidro), Rivera Navarrete offices and Panorama offices.
The total Backlog of the Real Estate Segment will be executed as follows: US$ 52.9 MM
in 2015, US$ 21.5 MM in 2016 and the rest in the remaining years.
Page 7
Consolidated Results Report - 1Q2015
Third Quarter of 2014
Technical Services
Revenues for the Technical Services Segment in 1Q2015 were similar to the ones registered in
1Q2014.
Gross Profit increased in 76.7%, reaching a Gross Margin of 16.4% as a consequence mainly of the
recovery of the results in Concar. It is worth mentioning that in 1Q2014 the results were impacted
by the cancellation of one of the road maintenance contracts with the Regional Government of
Cusco.
In addition, the Other Income / Expense account, includes the reversion of liabilities related to the
acquisition of CAM., which shows similar figures in 1Q2014 and 1Q2015.
The minority participation of CAM in projects that are not consolidated are reported in the line
“Participation in Associates”.
Pretax Income in 1Q2015 is S/. 0.75 MM, which is affected by the effective rate of income tax,
reaching a net loss of S/. 0.39 MM.
EBITDA in 1Q2015 was S/. 17.3 MM, with an EBITDA Margin of 7.1%.
Revenues (Million of S/.)
Ebitda (Million of S/.)
Net Income (Million of S/.)
as of 1Q2015
as of 1Q2015
as of 1Q2015
+208.5%
-90.4%
-1.3%
Capital Expenditures. Capital Expenditures (CAPEX) in 1Q2015 amounted to S/. 14.3 MM (US$ 4.6 MM), which corresponds to the electric services and information technology businesses.
Backlog.
The Technical Segment reported a Backlog of US$ 578.4 MM as of 1Q2015 which represents a decrease of 10.5% compared to the end of 2014.
The total Backlog of the Technical Services Segment will be executed as follows: US$
215.2 MM in 2015, US$ 177.0 MM in 2016 and the remaining in the following years.
Page 8
Backlog (Million of US$)
as of 1Q2015
Consolidated Results Report - 1Q2015
Third Quarter of 2014
Appendix: Action Plan 2015
With reference to the growth perspectives of our major markets, and to the reported results, during the first quarter of 2015 an action plan was created aiming to (i) Improve the profitability of the Business Areas and, (ii) Strengthen the financial position of the
Group.
In order to improve profitability of the Business Areas, the projects with high operational risks have been identified within the four
areas. These projects are part of our backlog to be executed in 2015, and so, a concrete action plan has been established for each
one of them with the objective of mitigate any negative impact in the results.
Moreover, we have quantified the commercial risk required to reach our estimates for the end of the year, based on the backlog to
be executed in 2015. We also are increasing our commercial efforts in the necessary measures in order to achieve the target projects.
Finally, we have identified 5 projects with improvement opportunities in the Gross Profit, for which concrete action plans have also
been implemented.
On the other hand, we have deployed overhead optimization projects all the companies of the Group, and we expect to end 2015
with lower figures tan the ones reported in the previous year, despite the Group’s growth. In addition, synergies between the
Group’s areas are being implemented with the objective of eliminating operational redundancies.
In order to reinforce the financial position of the Group, we are taking actions in two matters: (i) recovery of the working capital position, and (ii) optimization of CAPEX. With both of these actions we are looking to reduce the debt reported in March 2015, without
affecting the level of Capex.
Regarding the increase in the accounts receivables, we have initiated a specific action plan led by general managements of each Company, with the objective of solving the issues associated with the collections. These collections are not in litigation, but are under
direct negotiation with the clients either for being in a stage of project closures or in some cases, for having liquidity problems.
We are optimizing our capital investments in assets reposition without affecting growth, nor operation cost. Also, we are reducing
our planned investments in the real estate area, adapting to the new speed of this market.
With these efforts we expect to improve our profitability and strengthen our financial position, by maximizing our investment capacity.
Page 9
Consolidated Results Report - 1Q2015
Third Quarter of 2014
Appendix: Profits & Losses Statement per Company
Figures in Thousands of S/.
Appendix: Balance Sheet per Company
Figures in Thousands of S/.
Page 10
Consolidated Results Report - 1Q2015
Third Quarter of 2014
Appendix: Backlog Report to March 2015
Figures in Thousands of US$
Appendix: Recurrent Businesses Report to March 2015
Figures in Thousands of US$
Page 11
Consolidated Results Report - 1Q2015
Third Quarter of 2014
Appendix: Corporate Structure
89.4%
67.0%
98.1% ¹
88.7%
98.23%
99.9%
50.4%
99.6%
80.4%
99.9%
87.64%
100.0%
70.0%
75.0%
50.0%
95.0%
51.0%
(1) 38.97% of the share capital in Viva GyM is held by our subsidiary GyM.
Page 12
75.0%
Consolidated Results Report - 1Q2015
Third Quarter of 2014
Annex: Notes to the Consolidated Results
i) EBITDA
As of the information reported in the prospectus regarding the shares issuance registered before the SEC, the international market
practice for the EBITDA calculation has been adopted. The EBITDA calculation will start from the net income, figure to which the taxes, exchange rate differences and interests expenses will be returned to, whilst the depreciation and amortization will be added. We
previously reported the EBITDA calculated as operational income plus depreciation and amortization.
As mentioned on the Consolidated Results Report for the third quarter of 2013, we will report EBITDA calculated as follows:


Real Estate EBITDA: the proportional part of the land component of the units delivered during the period, will be added;
Metro de Lima : the financial expenses considered, as well as the capital amortization applied to the corresponding long-term
account receivable during the period, will be added.
ii) Backlog
As of the information reported in the prospectus regarding the shares issuance registered before the SEC, the reporting method of
the company’s Backlog will have modifications in the Infrastructure and Real Estate segments according to what is following described. Engineering and Construction and Technical Services will continue to report their backlog according to the local market,
therefore the total signed contracts will be reported.


Infrastructure: the Oil & Gas business and the Norvial toll road are not included as backlog
Real Estate: only the sold units which are pending of delivery are reported as backlog
iii) ROE
For the ROE calculation in the intermediate quarters, the net profit considered is the one for the last twelve months (LTM)

(LTM Net Profit divided by Total Equity)
iv) Gross Debt / EBITDA ratio
For the Gross Debt/Ebitda ratio calculation, the EBITDA considered is the one for the last twelve months (LTM)
 (Gross Debt divided by LTM EBITDA)
v) Net Debt / EBITDA ratio
For the Net Debt/Ebitda ratio calculation, the EBITDA considered is the one for the last twelve months (LTM)
 (Net debt, equal to Gross Debt minus Cash, divided by LTM EBITDA)
Page 13
Contacts:
Mónica Miloslavich Hart
Chief Financial Officer
(511) 213 6565
[email protected]
Dennis Gray Febres
Investor Relations Officer
(511) 213 6583
[email protected]
Samantha Ratcliffe Leiva
Deputy Investor Relations Officer
(511) 2136573
[email protected]
www.granaymontero.com.pe