Transcript
Results Presentation | 1Q10
2
Disclaimer
“ Forward looking statements included in this presentation regarding the
Company’s business, operating and financial results and Company’s growth
are only predictions and were based on management's expectations
regarding future performance. These expectations are highly dependent on
market conditions, Brazilian economic scenario, industry performance and
international markets, and are therefore subject to change ”
Corporate Profile
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Supply Chain
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Other Segments
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Plants Location – Fiber cement
Commercial Branches
1) Anápolis/GO; 2) Colombo/PR; 3) Goiânia/GO; 4) Rio de Janeiro/RJ; 5) Simões Filho/BA; 6) Porto Alegre/RS and 7) São Paulo/SP.
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Plants Location – Concrete tiles
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Timeline
Eternit’s most important accomplishments since its foundation in 1940
SAMA - Overview
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Global Market – Chrysotile Asbestos
* SAMA MINERAÇÃO (Minaçu/GO): Third largest in the world and first with ISO 14.001
Major World Producers – 2009
Russia
China
Brazil* 14%
Kazakhstan
Canada
Zimbabwe
22%
45%
10%
8%
1%
Global Consumption (MM of Ton)
2009 2.1
2008
2007
2006
2005
2.4
2.4
2.3
2.3
2004 2.1
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Competitive Advantages
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Sales of Chrysotile Asbestos (thous. tons)
291.0
74.1 69.2 70.077.7
70.4
Domestic Market Foreign Market
42.2 38.3 33.441.5
31.9 30.9 36.636.2
33.2
37.2
1Q09 2Q09 3Q09 4Q09 1Q10
Changes Domestic Market Foreign Market Total
1Q10/1Q09 + 16.6% - 21.4% - 5.0%
Eternit - Overview
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Products and solutions for civil construction
Water tanks and filters
Roof coverings
Components for constructions systems
Bathroom chinaware fixtures
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Covering market – Brazil (2009)
425459
2005 2006 2007
8%5%
2008
505
10%
2009
495
-2%
406
Residential Market Industrial and Commercial Market
Total Market Market Evolution (MM m2)
Ceramics35%
Metallic9%
Fiber cement49%
Others4%
Concrete3%
Fiber cement39%
Metallic35%
Ceramics14%
Others12%
Others2% Ceramics
43%Fiber cement
52%
Concrete3%
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Brazilian Fiber Cement Market
Structure of the Industrial Park in 2009
Installed capacity: Approx. 2,820,000 tons / year
Capacity utilization - around 86%
Consumption: Approx. 2,434,000 tons / year
Companies: 11
Plants: 19
Selling points: 35,000
Brazilian Fiber Cement Market
Installed Capacity: 850,000 tons/year
Capacity utilization - around 86%
Consumption: 731,000 tons/year
Market-share: 30%
Plants: 5
Selling Points: 12,000
ETERNIT
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Competitive Advantages
Products and Solutions for Civil Construction
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Sales of Fiber Cement* (thous. tons)
730.6
167.2 160.8
207.2195.4
207.8
1Q09 2Q09 3Q09 4Q09 1Q10
Changes Total1Q10/1Q09 + 24.2%
* Includes components for constructions systems
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Tégula - Overview
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Tégula Acquisition
• Largest Brazilian company in the concrete roofing business
• Portfolio with more than 33 product lines
• Resale of solar heating equipment
• Market share exceeding 30% in the Brazilian concrete roofing business in 2009
• Number of Employees: 428
• Installed Capacity: 7.2 million square meters
• Capacity Utilization from 02/11/2010 to 03/31/2010: around 60%
• Value of acquisition: R$ 39.2 million
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Main Products – Roof coverings
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Full Roofing Solution
Operating and Financial Aspects
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Consolidated Net Revenue – 1Q10
Consolidated Net Revenue* Net Revenue Breakdown
18%
101.7100.4
121.8
127.9
143.5
43.133.5
25.1 28.5 27.2
144.8 133.9
146.9156.4
170.7Fiber cement
roof coverings
61.8%
2.5%
Chrysotile Asbestos28.4%Concrete tiles
and Accessories5.1%
Others (**)2.2%
Components for constructions
systems
4Q09 1Q101Q09 2Q09 3Q09
Domestic Market Foreign Market
(*) in R$ million (**) Others: metallic roofing tiles, polyethylene water tanks, bathroom chinaware fixtures and water pipe filters
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COGS Breakdown – 1Q10
Fiber Cement Chrysotile Asbestos
Materials2
33%
45%
Depreciation4%
Others11%
Energy7%
WorkforceWorkforce
Raw material1
66%
9%
Depreciation3%
Others 19%
Energy3%
1 - Cement (48%), Chrysotile Asbestos (42%) and others (10%) 2 – Fuel, explosives, packaging, among others
Concrete Tiles
Raw Material3
50%
Workforce15%
Depreciation9%
Others22%
Energy4%
3 - Cement (54%), sand (33%) and others (13%)
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EBITDA and Net Income (in R$ million)
EBITDA Net Income
7.5%0%
35.7 35.7
29.927.8
30.121.6 17.3 17.0 17.2
23.2
1Q09 1Q104Q093Q092Q09 1Q09 2Q09 3Q09 4Q09 1Q10
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Margins
45%43%
40% 41%45%
25%22%
20% 19%21%
15%13% 12% 11%
14%
1Q09 2Q09 3Q09 4Q09 1Q10
Gross Margin EBITDA Margin
Net Margin
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Tégula – 1Q10*
Operating and Financial Aspects
Sales - Tiles (in m2) 587.466
Net Operating Revenue R$ 8,793 thousand
Gross Income
EBITDA
Net Income
R$ 2,844 thousand
R$ 969 thousand
R$ 618 thousand
* As from February 11 2010, Tégula’s results were consolidated with those of Eternit as a whole
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CAPEX
CAPEX (R$ million) CAPEX Breakdown (1Q10)*
9
8
34Administrative
1%Technology
6% Maintenance28%
Occupational safety
2%Quality and
Development
10%
CapacityProductivity
53%
1Q09 1Q10* Does not include Tégula acquisition
Tégula Acquisition
Other investments
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New production lines of finished products
At Goiânia / GO – Launched in April 2008.
At Colombo / PR – Launched in January 2009.
Capital Markets
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Eternit’s Shares Performance (Dec/06 - Apr/10)
Between 12/30/2006 and 04/30/2010, Eternit”s shares appreciated 17.1% and IBOVESPA appreciated 51.8%.
In the same period, including the payment of dividends and interest on own capital, Eternit’s shares appreciated 91.3%.
67,529
R$ 7.92
ETER3
IBOVESPA
40
80
120
160
200
dec-06 jun-07 dec-07 jun-08 dec-08 jun-09 apr-10
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Liquidity
Shareholders
2,482
7,3177,726
6,615 6,384
1,3021,638
2004 2005 2006 2007 2008 2009 2010(*)
(*) Until April 2010
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Liquidity
Average Traded Volume (R$ thousand)
3,708
2006 2007 2008 2009
1,297
2,900
1,108
2010(*)
1,127
716604
2004 2005
(*) Until April 2010
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Ownership Structure – April/10
2%
36%
5%
57%
Individual Investors (6,105 acionistas)
Corporations (88 acionistas)Investors Abroad (48 acionistas)Clubs. Funds and Foundations (143 acionistas)
Shareholders with more than 5% stake
Geração L. Par. Fund. Invest. em Ações 17.99%
Luiz Barsi Filho 11.29%
Victor Adler 6.63%
Free-Float 62.6%
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Shareholder Remuneration (2004 - May/10)
Net Income X Shareholders Remuneration (R$ million)
81 73
2007 2008 2009
4440
65
2010
55
3523
2004 2005 2006
20
38443433 30
Net Income Dividends and Interest on own capital
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Shareholder Remuneration (2004 - May/10)
Dividend Yield
2007 2008 2009
8.6%
12.8%
15.1%
2010
4.6%
2004 2005 2006
13.2%
17.1%16.2%
Outlook
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Structured Expansion and Diversification Program
INITIATIVES
- Creation of the Development and New Businesses Area
- Inclusion of metallic roofing on its portfolio
- Investment in new product lines of fiber cement
- Investment in machinery for new products on its plants
- Increase in SAMA’s production capacity
- Launches of new products
- Debut into chinaware bathroom fixtures
- Inorganic growth – Acquisitions
OBJECTIVE
Consolidate Eternit as a supplier of products and solutions to the civil construction industry
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Structured Expansion and Diversification Program
Sales of fiber cement (thousand tons)
431.3
522.5578.3 620.3
CAGR (2004/2009) = 11%
725.3 731.2
650.0 650.0 650.0 650.0730.0
850.0
2004 2005 2006 2007 2008 2009
Installed CapacitySales
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Structured Expansion and Diversification Program
Sales of Chrysotile Asbestos (Thousand tons)
CAGR (2004/2009) = 3%
270.0 270.0 270.0 270.0248.8 231.3 221.6
272.6295.0
300.0303.8 290.1
2004 2005 2006 2007 2008 2009
Installed CapacitySales
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Launches
Chinaware bathroom fixtures
Components for construction systems and
filters for water pipes
Colored fiber cement roofing tiles
Corporate and Environmental Management
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Corporate Management
Open Doors Program
Launch ................... November 2004
Purpose .................
Contribute to society’s better understanding of the mining and processing of Chrysotile Asbestos and the manufacture of fiber cement products in a sustainable manner.
Location ................ Five production plants of Eternit and the SAMA mining company
Visitors ................. More than 36,000 as of April 2010
Target .................... All society
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Raw material sector
Chrysotile Asbestos sector
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Filtration System Air
Latin America's largest with more than 17 thousand filter sleeves
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Environment Focused Management
Reforestation Work
Zero Reject Monitoring Air Quality
Water Reuse
Quelônios Project - Animal Conservation AreaThe only breeding program of Amazon turtles in Brazil and
Reintegration of Wild Animal Nature in partnership with IBAMA
Seedling Nursery
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Environment Focused Management
About 80% of the 4,500 hectares of the Cana Brava Mountains are maintained as Forest Reserve by SAMA.
Monitored area
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Social Actions - External Public
Terra Mirim Project
Eternit has partnered with the NGO Terra Mirim to promote the training of young people of Simões Filho and region to act as guides that will be inserted in a project of an ecological track to be implemented soon in the environmental reserve of this unit.The size of the area is 810 thousand square meters
Aerial view of the Environmental Reserve of Simões Filho (BA) Plant
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Social Actions - External Public
Brincar pra Valer Project! – It aims to show the children of a sub-prefecture of São Paulo, that their dreams can come true through thematic workshops and recycling.
Lar Escola São Francisco - Eternit contributes to LESF in order to rehabilitate children and adults with special needs in order to their physical recover, their educational and social integration
Publication and distribution of books in Braille and audio books - In partnership with the DorinaNowill Foundation, Eternit distributed in the vicinity of their units, more than 6 million copies in order to facilitate access to the blind.
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Social Actions - External Public
GRAAC - Eternit is a partner sponsor of GRAACC and helps to guarantee children and adolescents with cancer, in the most advanced scientific standard, the right to access all the chances of cure with quality of life.
Sambaíba Project – SAMA develops this project to a give young people a career through craft workshops with the reuse of waste rock extracted from the mine.
Sociedade dos Queimados - Eternit contributes to society of burning in order to promote the social reintegration of victims of fire burns, especially those from low-income segment, providing a better quality of life.
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Recreational Clubs - Workforce
Minaçu - GO Goiânia - GO
Rio de Janeiro - RJ Simões Filho - BA Colombo - PR
Anápolis - GO
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Events
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Shareholders' Meeting via WEB
www.eternit.com.br/ri
www.assembleianaweb.com.br
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Shareholders' Meeting via WEB
Another step in good corporate governance practices;
The system allows electronic proxy voting by digital certificate;
More than half of Eternit’ shareholders reside outside the state of Sao Paulo;
CVM (Securities and Exchange Commission of Brazil) and IBGC (Brazilian Corporate Governance Institute) recommend that companies encourage the participation of shareholders at meetings;
The first 1,000 registered shareholders will have free digital certificates for the first year;
Partners:
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BLOG
www.blogdaeternit.com.br
Access and participate.
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BLOG
Communication channel for all who wants to know about Eternit;
It aims to enable interaction between the company and its public in a transparent manner;
Another communication channel with stakeholders;
The blog is divided into four sections:
Chrysotile Asbestos
Civil Construction
Capital Markets
Environmental Responsibility
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American Depositary Receipt - ADR
On February 24 2010, the Board of Directors approved to initiate the accession process to the American Depositary Receipts Program - Level 1 ADRs.
Sponsor: Eternit;
Depositary Bank: The Bank of New York;
Custodian Bank: Banco Bradesco;
Ratio between Eternit’ shares and ADR: One ADR for one common share.
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IR Global Rankings
Award for Best CorporateGovernance in Latin America
IR Global Rankings elected for the second consecutive year the Program on Corporate Governance of Eternit as the best in Latin America. on April 9, 2010.
The 12th annual edition of the award had the participation of 503 companies from 35 countries . In the previous edition 163 companies from 32 countries participated
Chrysotile – The Brazilian Asbestos
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Chrysotile – The Brazilian Asbestos
White Asbestos
Bends and silky fibers without tip
High Concentration of Magnesium:3MgOSiO2H2O
Biopersistence*: 2.5 days
*Biopersistence: Time that a inhaled particle remains in the lungs before being eliminated by the body’s defense mechanisms. To cause lung damage, the fiber must have penetration and durability capacities in the alveoli.
The use of Chrysotile Asbestos in Brazil is regulated by the Federal Law 9.055/95, by Decree 2.350/97 and by regulatory standards for occupational health and safety. It is also provided in the Convention 162 of the International Labor Organization (OIT).
Serpentinite rock with chrysotile asbestos fibers
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Information
Gilberto Cominatogilberto.cominato@eternit.com.br
Élio A. Martinselio.martins@eternit.com.br
Rodrigo Lopes da Luz
rodrigo.luz@eternit.com.br
Investor Relations
Bárbara M. Tanure Gonçalves
barbara.goncalves@eternit.com.br
www.eternit.com.br/irPhone: (55-11) 3813-6034
This material was produced using FSC certified paper (Forest Stewardship Council), which is a guarantee that the raw materialcomes from a forest managed in an environmentally responsible, socially and economically viable.
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