Eucatex S.a. Industria E Comercio · BMFBOVESPA:EUCA3
Eucatex S.a. Industria E Comercio — Q3 2010 Earnings Presentation
28 slides from Eucatex S.a. Industria E Comercio's earnings presentation, Nov 4, 2010
Slide 1: 3Q10 Results
3Q10 Results November 4, 2010
Slide 2: Disclaimer
Disclaimer This presentation includes forward‐looking statements concerning the business prospects, projections and operating and financial targets Eucatex S.A. Indústria e Comércio, which are based on the beliefs and assumptions of management and on the information currently available to the compan
Slide 3: 3Q10 Highlights
3Q10 Highlights Gross Revenue of R$248.2 million, 18% up from R$209.8 million in 3Q09; Gross Margin of 37.7% in 3Q10 and 36.0% in 9M10, up by 6.9 p.p. in the quarter and 2.3 p.p. year to date; RECURRING EBITDA of R$39.2 million, 87.7% up from R$20.9 million in 3Q09; EBITDA Margin of 19.8% , 7.2 p.p.
Slide 4: Manufacturing Units
Manufacturing Units Hardboard Unit Location: Salto-SP Hardboard – 240,000 m³ Area: Land – 540,000 m² Panels and Doors – 1.8 million units Installations – 153,000 m² Paint Capacity – 50 million m² Number of employees: 775 MDP and Laminate Flooring Unit Location: Botucatu-SP MDP – 430,000 m³ Area: Lan
Slide 5: Forestry Unit
Forestry Unit 68 eucalyptus farms, totaling 45,700 hectares Salto Average Radius – 160 km Botucatu Average Radius – 24 km Forestry Unit – Bofete/SP New Planted Forests 2007 2008 2009 3Q10 9M10 5,400 ha 4,500 ha 2,040 ha 1,200 ha 2,600 ha Forests with ISO 14001 certification and Green Seal from Fores
Slide 6: Wood Recycling Unit
Wood Recycling Unit • Low-cost thermal power generation, preserving forests planted by the company. • Total processing capacity – 240,000 metric tons/year • 240,000 metric tons/year corresponds to approximately 470,000 m³ of standing timber or 1,500 hectares of forests • Volume Processed in 2009 – 1
Slide 7: Operating Data
Operating Data Revenue Breakdown by Product Gross Revenue Breakdown‐ 3Q10 Gross Revenue Breakdown ‐ 3Q09 MDP 3% 4% 15% 12% 28% Fiberboard 29% Paint and Varnish 23% 24% Laminated Flooring 31% Others 31% Sales Breakdown by Segment Sales Breakdown ‐ 3Q10 Sales Breakdown ‐ 3Q09 3%3% 5% Manufacturing 5%
Slide 8: Indicators
Indicators Unemployment Rate Real Wages Bill (Index 2005=Base 100) 132,85 10,6% 124,06 119,80 9,5% 110,64 106,90 7,6% 7,7% 6,2% set/06 set/07 set/08 set/09 set/10 set/06 set/07 set/08 set/09 set/10 % Real Estate Credit / GDP Consumer Confidence Index 3,49% 120,1 120,8 121,9 109,3 108,8 110,7 102,60
Slide 9: Indicators
Indicators Incentives to Construction – Federal Government Funding by Builders * Changes to legislation – patrimônio de afetação (segregation of project- 2007 2008 2009 2010 related assets), fiduciary sale; Brookfield 75 - 765 366 Increase in limit of financing through FGTS, from R$ 350 thousand to
Slide 10: Hardboard
Hardboard Installed Capacity Utilization Market Share 86% 91% 52% 58% 3Q09 3Q10 3Q09 3Q10 Cost Breakdown Sales Volume -Base 2005=100 Electricity and Thermal Power 17% Depreciation 143 130 135 8% 120 Labor 101 100 20% Raw Material 55% 3Q05 3Q06 3Q07 3Q08 3Q09 3Q10 10
Slide 11: MDP
MDP Installed Capacity Utilization Market Share 84% 89% 13% 11% 3Q09 3Q10 3Q09 3Q10 Cost Breakdown Sales Volume –Base 2005=100 Electricity and Thermal Labor Power 136 6% 9% 124 125 Depreciation 112 10% 100 101 Raw Material 3Q05 3Q06 3Q07 3Q08 3Q09 3Q10 75% 11
Slide 12: Mix de Vendas MDP
Mix de Vendas MDP Proportion of Eucatex coated MDP » Eucatex’s sales mix has the largest share of coated products in comparison with other manufacturers. In 3Q10, the percentage of coated products, which have Standard higher value added, represented 90% of shipped MDP. Coated 94% 90% 19% 3Q09 3Q10 3
Slide 13: Installed Capacity x Demand for MDP + MDF + HB
Installed Capacity x Demand for MDP + MDF + HB Installed Capacity vs. Internal Demand for MDF+MDP+HB (Fiberboard) 10.500 120% 9.500 99% 100% 88% 91% 84% 8.500 86% 83% 86% 84% 80% 80% Volume m3 (000) 75% 73% 73% 79% 80% 7.500 70% 70% 60% 6.500 40% 5.500 20% 4.500 3.500 0% 2002 2003 2004 2005 2006 200
Slide 14: Laminate Flooring
Laminate Flooring Installed Capacity Utilization Market Share 59% 61% 32% 37% 3Q09 3Q10 3Q09 3Q10 Cost Breakdown Sales Volume –Base 2005=100 Labot Electricity 8% and Thermal Power 225 7% Depreciation 174 2% 148 134 122 100 3Q05 3Q06 3Q07 3Q08 3Q09 3Q10 Raw Material 83% 14
Slide 15: Laminate Flooring
Laminate Flooring Presence in the Main Showrooms of the Country Casa Cor Campinas Marília Maia and Eliane Adesse Architects Equip Design da Equipotel Vilma Massud Interior Designer Casa Cor Rio de Janeiro Casa Cor Minas Gerais Claudia Brassaroto Haus Innen 2010 Morar Mais por Menos – RJ Fátima Diniz
Slide 16: Paint and Varnishes
Paint and Varnishes Installed Capacity Utilization Market Share 51% 58% 7% 8% 3Q09 3Q10 3Q09 3Q10 Cost Breakdown Sales Volume -Base 2005=100 Depreciation Labor 1% 7% Packaging 334 11% 296 255 209 140 100 Raw Material- Other 3Q05 3Q06 3Q07 3Q08 3Q09 3Q10 80% 16
Slide 17: Paint and Varnishes
Paint and Varnishes Feitintas 2010 and its Launches ▼ Launches: Acrylic Flooring, Acrylic Texture and Plaster & Drywall ▲ Feitintas 2010: the visitors saw new products and new packaging. Growth: Eucatex vs Market Growth 2006 2007 2008 2009 9M10 Eucatex 34% 52% 30% 12% 36% Market (*) 3% 6% 8% 5% 24%
Slide 18: Financial Highlights
Financial Highlights Highlights (R$ MM) 3Q10 3Q09 Var. (%) 9M10 9M09 Var. (%) Net Revenue 198.9 168.3 18.2% 579.7 482.7 20.1% Cost of Good Sold (123.8) (116.5) 6.3% (371.0) (320.0) 15.9% Gross Income 75.1 51.7 45.0% 208.7 162.7 28.3% Gross Margin (%) 37.7% 30.7% 7 p.p. 36.0% 33.7% 2.3 p.p. Administr
Slide 19: Investments
Investments R$ Million 3Q10 R$ Million 9M09 New T-HDF/MDF line / Other Projects 27.6 New T-HDF/MDF line / Other Projects 109.4 Forests 9.7 Forests 28.3 Sustenance 3.8 Sustenance 12.4 Total 41.1 Total 150.1 Sustenance Sustenance 9% 8% Forests Forests 19% 24% New T- New T- HDF/MDF HDF/MDF line / Other
Slide 20: New T-HDF / MDF Factory
New T-HDF / MDF Factory Technical Data Product similar to MDF, but denser T-HDF and higher-quality First line in Brazil specializing in T-HDF Pioneer production 110 million m²/ year Installed Capacity or 275,000 m³/ year Additional Gross Revenue R$ 250 million Aerial View of the Board Unit T‐HDF/MDF
Slide 21: New T-HDF / MDF Factory
© eucatex New T-HDF / MDF Factory | aI yaa pee
Slide 22: New T-HDF / MDF Factory
© eucatex New T-HDF / MDF Factory PRIMEIRA EXPEDIA DT ek ere y
Slide 23: New Paint Factory in Ribeirão/PE
New Paint Factory in Ribeirão/PE Project Data Product Water-Based Paints (initially) Installed Capacity in Liters 1.6 million liters / month Strategic Location Ribeirão/PE - 90km from Recife and 40km from Port of Suape Investments R$ 35 million Jobs Created 150 direct and indirect Target Market Shar
Slide 24: New Paint Factory in Ribeirão/PE
New Paint Factory in Ribeirão/PE » Topographic survey of the land already completed. » Approved blueprint. 24
Slide 25: Debt
Debt Debt (R$ MM) 9M10 9M09 Var. (%) Short Term Debt 89.8 53.3 68.6% Long Term Debt 77.3 43.4 78.3% Gross Debt 167.1 96.6 72.9% Cash and Cash Equivalents 3.5 2.5 38.8% Net Debt 163.6 94.1 73.8% % Short Term Debt 54% 55% -1,4 p.p. Net Debt/ EBITDA 1.1 0.9 19.0% Net Debt x EBITDA Debt Profile 1.0 x 1.
Slide 26: Capital Market Level I Migration
Capital Market Adhesion to the BM&Fbovespa Governance Levels Minimum float of 25% of capital Improvement of the information provided quarterly, including the Level I requirement of consolidation and special review Migration Disclosure of transactions with the Company’s shares by the Company’s contro
Slide 27: Capital Market
Capital Market EUCA4 x IBOVESPA (Base 100) 240 220 110% 200 180 33% 160 140 28% 120 100 Ibovespa 80 INDX Sep-09 Oct-09 Nov-09 Dec-09 Jan-10 Feb-10 Mar-10 Apr-10 May-10 Jun-10 Jul-10 Aug-10 Sep-10 Oct-10 Nov-10 Eucatex Multiples Shareholders’ Equity 900 800 700 600 Book Value per Share vs 0.6 R$ mill
Slide 28: IR Contacts
IR Contacts José Antonio G. de Carvalho Executive VP and IRO Sergio Henrique Ribeiro Controller Waneska Bandeira Investor Relations (11) 3049-2473 ri@eucatex.com.br www.eucatex.com.br/ir 28
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