2 q09 results presentation

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CSU CARDSYSTEM SA

[email protected]

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Disclaimer

This presentation may include forward-looking statements about future events or results according to

the regulations of Brazilian and international securities and exchange commissions. These statements

are based on certain assumptions and analyses by the Company that reflect its experience, the

economic environment, future market conditions and events expected by it, many of which are beyond

its control. Important factors that may lead to significant differences between actual results and the

statements of expectations about future events or results include the company’s business strategy,

economic conditions in Brazil and abroad, technology, financial strategy, client business development,

financial market conditions, uncertainty regarding the results of its future operations, plans, objectives,

expectations and intentions, among others. As a result of these factors, the actual results of the

Company may significantly differ from those mentioned or implicit in the statement of expectations

about future events or results.

The information and opinions contained in this presentation should not be understood as a

recommendation to potential investors and no investment decision should be based on the veracity,

currency or completeness of this information or these opinions. No advisors to the company or parties

related to them or their representatives will be responsible for any losses that may result from the use

or the contents of this presentation.

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Cards Market and CardSystem

Base growth continues quicker than market

growth

Trend of replacement of private label

cards with hybrid cards

Opportunities generated by government

actions in the cards market (possible

dispersion of acquirers).

Private Label + Credit Market CardSystem

Average Annual Growth - 3 years 21.0% 28.8%

Growth - 12 months 16.0% 22.0%

Source: ABECS, CSU

91 105 128 157 18359

7182

112129

2005 2006 2007 2008 2009

Growth of the Cards Market

Private Label Credit

(million, end of May, source: ABECS)

9.9 10.114.2

17.721.6

2005 2006 2007 2008 2009

CSU Card Base Performance(million, end of June)

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CardSystem – Operational Data

6 million new cards issued in the past 12 months

Card issues resumed growth in the quarter the turbulent economic

scenario

Flex Cards with increasing share of total card issues

Seasonal growth in card issue expected in the second half.

Source: CSU

1.4 1.7 1.6

1.3 1.4

2Q08 3Q08 4Q08 1Q09 2Q09

Issue of cards in CSU's base (million, end of june)

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MarketSystem – Operational Data

Hiring of executives focused on prospecting new clients and

accelerating the company’s growth

Managed accounts 30% up year-on-year;

100% organic growth in the period.

Source: CSU

1.84 1.90 1.98 2.03 2.12 2.34 2.38 2.65 2.80

2Q07 3Q07 4Q07 1Q08 2Q08 3Q08 4Q08 1Q09 2Q09

MarketSystem - Processed Accounts(million)

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CSU.Contact / Credit&Risk

Launch of CSU.Contact and the important Alphaview

project

New unit commences operations with the erstwhile

Telesystem’s scale but with a new concept in

providing contact center services

Alphaview will improve the quality of life of

operators, increase service levels and reduce

operating costs.

776 748 619 435 282 305 344

2.546 2.218 3.476 3.445

3.314 3.288 3.238

4Q07 1Q08 2Q08 3Q08 4Q08 1Q09 2Q09

PAs in operation at CSU.Contact and Credit&Risk

PA's Credit&Risk PA's CSU.Contact

3.322 3.593 3.596 3.880 4.095

2.996

3.582

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15.3

18.7

2Q08 2Q09

16.5

21.7

2Q08 2Q09

50

62.3

2Q08 2Q09

Cardsystem / MarketSystem

24.5%

Organic growth of the client portfolio;

Increase in average revenue per card due to the increased share of credit cards

over private label cards;

Economies of scale in card processing operations;

Higher gross margin;

31.4% 22.4 %

(R$ million)(R$ million, %) (R$ million, %)

Gross Revenue Gross Profit and Gross Margin

EBTIDA and EBTIDA Margin

38.2%35.5%32.6%32.9%

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0.5

1.8

2Q08 2Q09

1.5

3.7

2Q08 2Q09

46.946.3

2Q08 2Q09

140.5%244.6%

(R$ million)(R$ million, %) (R$ million, %)

Gross Revenue Gross Profit and Gross Margin

EBTIDA and EBTIDA Margin

Stability of revenue levels;

Reduction of communication costs due to lower ICMS tax at the Recife

site and a decrease in active Contact Center services;

Higher gross margin and EBITDA margin.

CSU.Contact / Credit&Risk

8.6%4.3%

1.2%3.5%

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Performance of Financial Indicators

17.5 17.7 17.4

20.6 20.4

2Q08 3Q08 4Q08 1Q09 2Q09

EBITDA Margin (%)

96.9101.2

104.9 107.3 108.6

2Q08 3Q08 4Q08 1Q09 2Q09

Gross Revenue CSU (R$ million)

15.8 16.7 16.9

20.5 20.5

2Q08 3Q08 4Q08 1Q09 2Q09

EBITDA CSU (R$ million)

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15.3 16.9 16.7 18.4 18.7

0.5 (0.2) 0.2 2.0 1.9

2Q08 3Q08 4Q08 1Q09 2Q09

CardSystem / MarketSystem CSU.Contact / Credit&Risk

5055.6

61.3 62.4 62.3

46.9 45.642.6 44.9 46.3

2Q08 3Q08 4Q08 1Q09 2Q09

CardSystem / MarketSystem CSU.Contact / Credit&Risk

Results - Units

(R$ million)

(R$ million)EBTIDA

GROSS REVENUE

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18.1

25.4

2Q08 2Q09

96.9

108.6

2Q08 2Q09

72.175.1

2Q08 2Q09

12.1%

(R$ million)

(R$ million, %)

Gross Revenue

4.0%

(R$ million, %)

Cost of Services Rendered

CSU (Consolidated)

40.8%

Gross Profit and Gross Margin

Organic growth of units drove company growth by over 12%;

Economies of scale led to improved margins;

Strict cost control, tax incentives and new controls and policies for internal

spending.

25.3%20.0%

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15.8

20.5

2Q08 2Q09

2.1

4.8

2Q08 2Q09

CSU (Consolidated)

14.8

16.8

2Q08 2Q09

13.6% 30.0%

(R$ million)(R$ million, %)

Operational Expenses EBTIDA and EBTIDA Margin

Expenses with the launch of new brand and staff increase led to higher

expenses in the quarter;

Higher revenue combined with appropriate management of costs and

expenses helped increase EBITDA by 30%;

CSU’s earnings per share was R$0.20 in 1H09.

125.3%

(R$ million, %)Net Result

20.4%17.5%

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Debt and Capex

Debt:

Cash flow in the period enabled net debt

decrease from R$ 86.3 million to R$ 77.5

million;

Extension of average debt term. Sum of

R$23 million renegotiated at CDI rate +

3.4%;

CSU neither has loans indexed to the US

dollar nor derivatives contracts. Its debt

is in Brazilian reais and indexed to the

interbank (CDI) rate.

68.5 70.8 60.3 49.8

4,8 4.0 4.6

6.5

22.7 17.9 22.8

15.9

3Q08 4Q08 1Q09 2Q09

Debt Composition

Leasing Overdraft W. Capital

(R$ million, end of the period)

Debt - R$ million

2Q09 2Q08 1Q09

Short term Debt 46.4 47.4 58.0

Financing and Debt loan 36.5 29.7 47.4

Leasing 9.9 17.6 10.7

Long term debt 31.6 53.3 29.7

Financing and Debt loan 20.0 4.7 17.9

Leasing 11.6 8.6 11.8

Gross Debt 78.0 100.6 87.7

(-) Cash 0.5 2.7 1.5

Net Cash (Debt) 77.5 98.0 86.3

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Debt and Capex

Debt:

The graph shows the impact of

the interbank rate (CDI)

variations in recent months on

the Company's financial

expenses;

Drop in the CDI rate, combined

with the debt reduction, helped

to reduce financial expenses;

Capex - R$ million

2Q09 2Q08 Chg. 1Q09 Chg.

Systems (SW and HW) 6.8 4.4 53.9% 12.4 -45.5%

Other 0.0 0.8 -97.6% 0.5 -96.3%

Capex 6.8 5.3 28.2% 12.9 -47.5%

CAPEX:

Recurring investment in the

development and customization of the

Super VisionPlus software;

Investments in the Alphaview project.

96 91 89 75

112 125 10272

117137

115

100

3Q08 4Q08 1Q09 2Q09

Impact of Monetary Policy on Cost of Debt

Total Gross Debt - Closing Financial Cost - CDI

CDI - Period Monthly Average

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Key Strategies for 2H09

Maintain investments to ensure growth of all of the Company’s

units;

Consolidate recent changes in CSU’s sales and relationship

areas;

Finish the new organizational structure of CSU.Contact and

Credit&Risk, migrating the workstations from the old site to

Alphaview;

Maintain cost and quality levels.

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CSU CardSystem S/A

Questions and

AnswersDécio Burd

Telephone: (0xx55 11) 3030-3821

Email: [email protected]

Site: www.csu.com.br/ri