Slide 1: Earnings Release 3Q10
Earnings Release 3Q10 October 27, 2010
Slide 2: Important Note
Important Note A TRADITION OF INNOVATION This release contains forward-looking statements subject to risks and uncertainties. Such forward-looking statements are based on the management’s beliefs and assumptions on information currently available to the Company. The reservations as to forward-lookin
Slide 3: Highlights
Highlights A TRADITION OF INNOVATION • Romi’s EBITDA margin is 18% in 3Q10, or R$ 30.5 million, a growth of 28.7% over 2Q10 and of 242.8% as compared to 3Q09; • EBITDA margin in 3Q10 reaches 18%, presenting a growth of 3.9 p.p. over 2Q10 and 10.7 p.p. as compared to 3Q09; • Net Operating Revenue rea
Slide 4: Product Line 9M10 Net Sales
Product Line A TRADITION OF INNOVATION Machine Tools Plastic Processing Machines Casting 9M10 Net Sales 10% R$ 301.9 MM R$ 129.6 MM 10% 10% R$ 50.8 MM 27% 27% 27% 63% 63% 63% 4
Slide 5: Economic Indicators
Economic Indicators A TRADITION OF INNOVATION GDP – Industrial GDP – Gross Fixed Capital Formation 30,0 25,0 20,0 15,0 10,0 5,0 0,0 GDP Indl GDP Investments -5,0 -10,0 -15,0 -20,0 08-I 08-II 08-III 08-IV 09-I 09-II 09-III 09-IV 10-I 10-II Source: IBGE (QxQ) 5
Slide 6: Industry Confidence Indicator
Industry Confidence Indicator A TRADITION OF INNOVATION ICEI – Industry Confidence Indicator 70 68.7 66.0 65.9 63.4 62.0 62.8 60 60.4 50 47.4 40 oct/07 jan/08 apr/08 jul/08 oct/08 jan/09 apr/09 jul/09 oct/09 jan/10 apr/10 jun/10 jul/10 aug/10 sept/10 oct/10 Source: CNI 6
Slide 7: Capacity Utilization - Brazilian Industry
Capacity Utilization - Brazilian Industry A TRADITION OF INNOVATION Capacity Utilization of some industrial sectors 100 Basic Metal Parts 95 Automotive 90 Plastic and Rubber Goods 85 Metal Goods – excl. Machinery 80 Machinery and Equipment 75 70 08-1 08-2 08-3 08-4 08-5 08-6 08-7 08-8 08-9 08-1008-1
Slide 8: Machine Tools – Sales main sectors
Machine Tools – Sales main sectors A TRADITION OF INNOVATION Equipment Agricultural Automotive Job Shops Schools Technical Oil & Gas Tooling Goods Capital Others CNC Lathes – Flat Bed Heavy CNC Lathes Machining Center CNC Lathes Combination CNC Lathes Slant Conventional Lathes MF Net Rev. 9M10 23% 1
Slide 9: Plastic Machines and Castings – Sales main sectors
Plastic Machines and Castings – Sales main sectors A TRADITION OF INNOVATION Plastic Machines Castings ROL % ROL % SECTOR SECTOR 9M10 2009 9M10 2009 Packaging 26% 26% Automotive (Trucks) 70% 58% Automotive 24% 17% Electricity Generation 3% 23% Job Shops 12% 13% Agriculture 18% 14% Home Appliances 10
Slide 10: Order Entry
Order Entry A TRADITION OF INNOVATION Order Entry (R$ thousands) 1Q10 2Q10 3Q10 %Chg. 3Q/2Q 3Q09 3Q10 % Chg. Machine Tools 94,084 132,784 111,777 (15.8) 115,371 111,777 (3.1) Plastic Machines 42,138 53,187 43,865 (17.5) 45,892 43,865 (4.4) Rough and Machined Cast Iron Parts 21,968 22,065 24,276 10.0
Slide 11: Continuous Growth and Profitability
Continuous Growth and Profitability A TRADITION OF INNOVATION Net Revenues (R$ MM) EBITDA and EBITDA Margin (R$ MM) 696.1 21.2% 632.0 20.1% 108.3 19.1% 18.2% 548.9 82.1 17.6% 510.6 65.4 475.4 133.7 122.3 445.7 75.3 62.6 110.6 65.1 85.3 92.7 549.9 587.8 435.3 483.5 412.8 6.1% 380.6 29.1 2004 2005 200
Slide 12: Foreign Markets
Foreign Markets A TRADITION OF INNOVATION Foreign Markets – 3Q10 Foreign Markets – US$ MM – 3Q10 9.9% 7.8 7.1 Latin North America America 11.0% 32.6% Europe 56.4% 3Q09 3Q10 Foreign Markets – 9M10 Foreign Markets – US$ MM – 9M10 21.5 22.4 Africa, Asia 4.2% Latin & Oceania North America 0.5% America 8
Slide 13: Cost of Goods Sold
Cost of Goods Sold A TRADITION OF INNOVATION Cost Structure – Consolidated – 9M09 Other Expenses 6% Depreciation 4% Material 27% Domestic Material and Components 61% 10% Domestic Materials and Components FX related Labor 8% Metals 29% 16% Imported Materials and Components Cost Structure – Consolidat
Slide 14: Consolidated Margins
Consolidated Margins A TRADITION OF INNOVATION R$ MM 3Q10 2Q10 3Q09 QoQ YoY 9M10 9M09 YoY Gross Profit 65.2 59.6 37.0 9.5% 76.3% 177.0 93.5 89.3% Gross Margin 38.5% 35.6% 30.3% 2.9 p.p. 8.2 p.p. 36.7% 31.0% 5.7 p.p. EBITDA 30.5 23.7 8.9 28.7% 242.8% 72.8 6.2 1,070.5% EBITDA Margin 18.0% 14.1% 7.3% 3
Slide 15: Business Units Net Revenue and Sales Volume
Business Units Net Revenue and Sales Volume A TRADITION OF INNOVATION R$ MM 3Q10 2Q10 3Q09 QoQ YoY 9M10 9M09 YoY Machine Tools R$ mm 103.0 96.1 77.7 7.1% 32.5% 301.9 192.7 56.7% Units Sold 556 538 365 3.3% 52.3% 1,620 930 74.2% Plastic Machines R$ mm 47.0 53.7 32.1 -12.5% 46.6% 129.6 76.3 69.8% Unit
Slide 16: Business Units Margins
Business Units Margins A TRADITION OF INNOVATION R$ MM 3Q10 2Q10 3Q09 QoQ YoY 9M10 9M09 YoY Machine Tools Gross Margin 45.0% 42.7% 40.4% 2.3 p.p. 4.6 p.p. 43.0% 38.7% 4.3 p.p. EBIT Margin 19.5% 16.8% 13.4% 2.7 p.p. 6.1 p.p. 17.5% 6.2% 11.3 p.p. Plastic Machines Gross Margin 36.2% 34.4% 25.6% 1.8 p.p
Slide 17: Cash Position
Cash Position A TRADITION OF INNOVATION Cash and Cash Equivalent – R$ MM – 09 09//30 30//2010 Loans * – R$ MM – 09/30/2010 Total Loans: 241.7 Amount Bank Certificate of Deposit (CDB) 57.5 The maturities of financing recorded as Financial Investments with debentures 29.7 follow: Time Deposit - Abroad
Slide 18: Capital Markets
Capital Markets A TRADITION OF INNOVATION Share Performance (ROMI3) vs. Bovespa Index (Basis: 100) - R$/Share Period: September/2008 - September/2010 180 25.000.000 160 IBOVESPA: 40.1% 20.000.000 140 120 15.000.000 100 80 10.000.000 60 ROMI3: 43.2% 40 5.000.000 20 0 - Oct-08 Oct-09 Jan-09 Feb-09 Apr
Slide 19: Corporate Governance
Corporate Governance A TRADITION OF INNOVATION • Novo Mercado – Joining the Novo Mercado in March 2007 positioned Romi in Bovespa’s highest level of Corporate Ownership Structure Governance • Tag along - 100% • Board of Directors – One year term, 8 members, being 4 Romi / Chiti Fundação Fenix (1) Fr
Slide 20: Guidance 2010 - 2011
Guidance 2010 - 2011 A TRADITION OF INNOVATION Indicators 2010 2011 Revised – July/2010 Net Operating Revenue 35% to 40% 10% to 20% Growth EBITDA Margin 14% to 17% 12% to 18% CAPEX R$ 45 Million R$ 35 Million Assumptions 2011 GDP 4.5% Dolar x Real (Average) 1.70 Inflation 5.5% 20
Slide 21: Sustainability Indicators
Sustainability Indicators A TRADITION OF INNOVATION Released in Romi’s Annual Report The Sustainability indicators are reported based on GRI (Global Reporting Initiative) standards, level B. 21
Slide 22: Livaldo Aguiar dos Santos, Luiz Cassiano R. Rosolen
Livaldo Aguiar dos Santos Luiz Cassiano R. Rosolen CEO – Chief Executive Officer Investor Relations Officer 55 19 3455-9588 55 19 3455-9004 lagsantos@romi.com lrosolen@romi.com www.romi.com www.romi.com