Top Banner
Corporate Presentation June, 2012
38
Welcome message from author
This document is posted to help you gain knowledge. Please leave a comment to let me know what you think about it! Share it to your friends and learn new things together.
Transcript
Page 1: 20120629 apresentação institucional junho atualizada

Corporate Presentation

June, 2012

Page 2: 20120629 apresentação institucional junho atualizada

DISCLAIMER

The Company makes forward looking statements that are subject to risks anduncertainties. These statements are based on the beliefs and assumptions of our management as wellas on information currently available to us. Forward-looking statements include information regarding ourcurrent intent, beliefs or expectations, in addition to those of the members of the Board of Directors andExecutive Officers of the Company.

Forward-looking statements also include information regarding our possible or assumed future operatingresults, as well as statements preceded or followed by, or that include, the words ''believes”, ''may”,''will”, ''continues”, ''expects”, ''anticipates”, ''intends”, ''plans”, ''estimates”, or similarexpressions.

Forward-looking statements are not guarantees of performance. They involve risks, uncertainties andassumptions, for they relate to future events, thus depending on circumstances that may or may notoccur. Our future results and the creation of value to shareholder s may differ significantly from thoseexpressed in or suggested by these forward-looking statements. Many factors determining theseresults and values are beyond Cielo’s ability to control or predict.

2

Page 3: 20120629 apresentação institucional junho atualizada

BRAZIL | CARD INDUSTRY

3

Source: ABECS e IBGE* the Q1 numbers are estimated)

17.1%18.9%

20.7%22.5%

24.3%

26.9% 27.1%

2006 2007 2008 2009 2010 2011 1Q12*

Penetration Of Cards as Means of Payment in the Private Consumption Expenditure (PCE)

Page 4: 20120629 apresentação institucional junho atualizada

BRAZIL | MACROECONOMIC SCENARIO

4

45% 46% 43% 44%40% 41%

55%

54%57%

56%

60% 59%

0,0

5,0

10,0

15,0

20,0

25,0

30,0

35,0

40,0

45,0

0

200

400

600

800

1.000

1.200

1.400

1.600

2007 2008 2009 2010 2011 Mar/12

Credit/GDPCredit

(R$million)

Credit Evolution

Individuals Legal Entities Credit/GDP

936

1,227

1,414

1,704

Source: BCB

2,030 2,070

4

5

6

7

8

9

10

11Unemployment (%)

Source: IBGE

0

2

4

6

8

10

12

14

16

18Retail Trade Sales (%)

Source: IBGE

4.0

6.1

5.1

-0.2

7.5

2.7 2.7

2006 2007 2008 2009 2010 2011 2012(E)

GDP ( %)

PIB: IBGE(E) Estiimates- Focus Report- BCB

Page 5: 20120629 apresentação institucional junho atualizada

BRAZIL | ECONOMIC SCHEME

Gross MDR

Net MDR Interchange Fee

The brand defines the interchange fee.

5

The acquirer negotiates the gross MDR with the merchant.

MERCHANTS

Page 6: 20120629 apresentação institucional junho atualizada

BRAZIL | TRANSACTION FLOW

MERCHANTSCARD HOLDERS CARD HOLDERS MERCHANTS

ISSUER ISSUER

Credit Transaction Debit Transaction

6

Page 7: 20120629 apresentação institucional junho atualizada

Brazil has a total areaof 8,514,876 km²

MAIN ENTRY BARRIER | BANKING DISTRIBUTION

NUMBER OFBRANCHES

NORTH 293 277 82 48 92 35 0 0 3

NORTHEAST 1,127 833 288 196 411 56 3 7 9

MIDWEST 459 344 293 95 193 105 1 6 6

SOUTHEAST 2,338 2,387 2,528 1,832 1,137 427 7 103 69

SOUTH 1,049 772 637 356 501 239 441 10 16

TOTAL 5,266 4,613 3,828 2,527 2,334 862 452 126 103

Banking distribution is the mainbarrier to new players

70% of the affiliations are donethrough banks

SOURCE: BRAZILIAN CENTRAL BANK , MARCH 2012

7

Page 9: 20120629 apresentação institucional junho atualizada

28.6%

28.6%

42.4%

0.3%

Banco Bradesco Banco do Brasil

Free-float Treasury

655.096.224 common shares

9

CIELO | OWNERSHIP

Page 10: 20120629 apresentação institucional junho atualizada

CIELO | PLANNING MATRIX

10

Partnership with

Cybersource

Page 11: 20120629 apresentação institucional junho atualizada

UPCOMING SOON

VO

UC

HER

CR

EDIT

AN

D D

EBIT

CIELO | PORTFOLIO OF BRANDS

11

Page 12: 20120629 apresentação institucional junho atualizada

Cielo Fidelidadeis the only loyaltyprogram developedexclusively to merchants

Scheme: accrual of pointsbased on the merchant’svolume with Cielo andredemption of points for morethan 20 thousand products

Cielo Fidelidadeis the largest B2Bloyalty program inLatin America

CIELO | LOYALTY PROGRAM

12

Page 13: 20120629 apresentação institucional junho atualizada

CIELO PREMIA IS THE MOST

AND BRINGS AN ADVANCED TECHNOLOGYCHANGING THE CULTURE OF CARRYING OUTPROMOTIONS AT THE POINT S OF SALES

FLEXIBLE AND THE EASIEST TO USE

PROMOTIONAL MARKETING TOOL

IN THE MARKET

CIELO INNOVATES ONE MORE TIME

13

CIELO | ADDING VALUE TO MERCHANTS

Page 14: 20120629 apresentação institucional junho atualizada

SURPRISES

ENGAGES

SEGMENTS

MANAGES

The card owner with a differentiatedpayment experience

The card owner through multiplegifts and discounts

The promotion according to your needs (Bank/Card Brand/Card type/Purchasing option: Debit or Credit)

The promotion automaticallyreducing operational costs strongly

CIELO | PREMIA’S MAIN ADVANTAGES

14

Page 15: 20120629 apresentação institucional junho atualizada

IT GIVES THE CLIENT

ON A SPECIFIC DAY / TIMEA GIFT OR A DISCOUNT

ADVANTAGES TO

IT INCREASES THE RETURN

FREQUENCY ON A DAYWITH LOW MOVEMENT

CIELO CLIENT

15

CIELO | FIXED DAY AND TIME

Page 16: 20120629 apresentação institucional junho atualizada

*** CONGRATULATIONS!***

DISCOUNT TO YOU

10% discount

At the end of the day

On Mondays

PRIZE BALANCE

--------------------------

EXPIRING DATE: 01/31/2011

16

CIELO | FIXED DAY AND TIME

Page 17: 20120629 apresentação institucional junho atualizada

CIELO | INNOVATIVE PRODUCTS

17

Unprecedented payment solution

application in Brazil for iPhone, iPad and

iPod touch as well as Android system

and Blackberry

Devices used as POS terminal for mobile

payment with Visa, MasterCard,

American Express and Elo cards

Page 18: 20120629 apresentação institucional junho atualizada

INNOVATION – MOST RECENTLY

LAUNCHED PRODUCT

Crediário is a recently launched unique and

exclusive technology developed by Cielo that

allows the merchant to sell from 2 to 48

installments, accessing the credit approved

by the banks to the consumers and available

in their credit cards.

CREDIÁRIO: WHAT IS IT?

18

Page 19: 20120629 apresentação institucional junho atualizada

INNOVATION – MOST RECENTLY

LAUNCHED PRODUCT

Cardholders of Visa from Banco

do Brasil and Bradesco – with

R$100 billion in credit available

to the product. In the coming months

others banks will join (HSBC and

Caixa Ecônomica Federal).

Merchants of Cielo who would like

to offer an additional payment

scheme without directly

financing the cardholder.

CREDIÁRIO: who can benefit?

19

Page 20: 20120629 apresentação institucional junho atualizada

INNOVATION – MOST RECENTLY

LAUNCHED PRODUCT

MERCHANT

• More sales volume – 20 million plus cardholders from BB

and Bradesco with pre-approved lines of credit;

• Better cash flow as funds are received in D+1;

• Increase in average ticket;

CARDHOLDER

• Pre-approved credit line from the bank;

• Attractive interest rates;

• Additional limit besides credit card’s limit;

• Simulation at the point of sale;

CIELO

• More sales volume;

• Merchant Discount Rate of credit in installments.

CREDIÁRIO: more advantages to participants

20

Page 21: 20120629 apresentação institucional junho atualizada

CIELO | ORIZON AQUISITION

Founded in 2006

Ownership interest of 40.95%;

Interconnection between healthcare and dental operators and services

providers

21

Page 22: 20120629 apresentação institucional junho atualizada

CIELO | M4U AQUISITION

Founded in 2000

innovation in the development of technological mobility platforms

largest mobile top up and mobile payment platforms in the country

developed several applications under the most diverse cell phone

standards for a wide range of clients in the financial and telecom

markets

Founders will continue to head the business

Deal

Announced August 2010

Total amount of R$ 50.1 million

R$ 25.05 million already paid and the other half will be payable

after 37 months from the closing date (as long as the contractual

targets are met)

22

Page 23: 20120629 apresentação institucional junho atualizada

CIELO | Paggo Soluções JV

Combine Oi’s mobile payment experience with Cielo’s

coverage and experience with electronic payment networks, in

order to create a joint venture to offer acquiring and transaction

capture services using mobile devices

Creation of a new company controlled by both Oi and Cielo

Announced September 2010

23

Page 24: 20120629 apresentação institucional junho atualizada

CIELO | BRASPAG AQUISITION

Deal announced May 2011

Total amount of R$ 40 million

Founded in 2005

Leader as a gateway for e-commerce in Brazil, with approximately

65% market share

Platform integrates online stores, financial institutions and

acquirers, and is responsible for capturing, routing and managing

payment transactions with cards, collection slips and online debit

24

Page 26: 20120629 apresentação institucional junho atualizada

CIELO | ADR

26

Cielo has a sponsored Level I ADRTicker: CIOXYADR Ratio (ADR:ORD): 1:1Depositary bank: Deutsche Bank Trust Company AmericasDepositary bank contacts:

ADR broker helpline:Tel: +1 212 250 9100 (New York)Tel: +44 207 547 6500 (London)

Email: [email protected] website: www.adr.db.com

Depositary bank’s local custodian: Banco Bradesco

Page 27: 20120629 apresentação institucional junho atualizada

Financial Indicators 1Q12 1Q11 1Q12 X 1Q11 4Q11 1Q12 X 4Q11

Financial Volume(R$ million)

88,081.8 70,203.7 25.5% 91,252.7 -3.5%

Transaction(million)

1,269.4 1,058.7 19.9% 1,301.8 -2.5%

Net Revenue*(R$ million)

1,399.5 1,082.1 29.3% 1,383.1 1.2%

Cost of Services(R$ million)

(399.1) (311.5) 28.1% (405.7) -1.6%

Operating Expenses(R$ million)

(129.9) (139.9) -7.1% (207.9) -37.5%

Unit Costs + Expensesex subsidiaries

(0.37) (0.39) -4.3% (0.44) -15.2%

Adjusted EBITDA(R$ million)

943.8 684.3 37.9% 833.2 13.3%

Net Income(R$ million)

566.6 424.6 33.4% 504.5 12.3%

Blended Net MDR (bps) 105 105 - 105 -

Credit Net MDR (bps) 119 122 (3) 119 -

Debit Net MDR (bps) 81 76 5 81 -

CIELO | FINANCIAL INDICATORS

27* Including prepayment of receivables present value adjusted

Page 28: 20120629 apresentação institucional junho atualizada

CIELO | OPERATING PERFORMANCE

28

1.1%

-3.5%

79,775

70,205

88,08225.5%

74,623

91,2531,269

1,058 1,0941,167

1,302

-2.5%

19.9%

11.7%

1.085

1.115

1.153

1.1991.212

1Q11 2Q11 3Q11 4Q11 1Q12

Cielo- Number of Active Merchants ( 1 transaction in the last 60 days)

162.933 197.541 50.368 56.034 56.786

98.742 118.315 29.407

35.219 31.296

1Q11 2Q11 3Q11 4Q11 1Q12

Cielo Financial Volume ( R$million)

Credit cards Debit cards

611 639 678 730 738

447 455 489572 531

1Q11 2Q11 3Q11 4Q11 1Q12

Cielo- Number of Transactions (million)

Credit Debit

Page 29: 20120629 apresentação institucional junho atualizada

CIELO | FAIR SHARE

29

Source : Public information, released by the companiesOthers = Redecard and Santander/GetNet

Financial Volume Breakdown (in R$)

Considering the 2 main participants , Cielo gained 0.7 p.p. quarter-on-

quarter

Considering the 3 main participants, Cielo gained 0.5 p.p. quarter-on-

quarter

57,2% 57,7% 57,9% 59,5% 60,2%

42,8% 42,3% 42,1% 40,5% 39,8%

1Q11 2Q11 3Q11 4Q11 1Q12

Cielo Redecard

56,4% 56,7% 56,7% 58,0% 58,5%

43,6% 43,3% 43,3% 42,0% 41,5%

1Q11 2Q11 3Q11 4Q11 1Q12

Cielo Others

Page 30: 20120629 apresentação institucional junho atualizada

30

Source : Public information, released by the companies

Financial Volume Breakdown (in R$)

Considering the 2 main participants , Cielo gained 0.7 p.p. quarter-on-quarter

57,2% 57,7% 57,9% 59,5% 60,2%

42,8% 42,3% 42,1% 40,5% 39,8%

1Q11 2Q11 3Q11 4Q11 1Q12

Cielo Redecard

CIELO | FAIR SHARE

Page 31: 20120629 apresentação institucional junho atualizada

31

6,1% 6,3% 6,6% 6,4% 7,0%

9,8% 11,0% 11,6% 11,7% 11,6%

22,5% 21,5% 20,4% 19,4% 21,1%

16,4% 16,6% 16,9% 18,7% 16,5%

45,2% 44,6% 44,6% 43,8% 43,8%

1Q11 2Q11 3Q11 4Q11 1Q12

Revenue Breakdown (%)

Credit cards Debit cards POS Rental Prepayment of Receivables Other revenues

CIELO | REVENUES BREAKDOWN

Page 32: 20120629 apresentação institucional junho atualizada

CIELO | REVENUES

32

POS 1Q11 2Q11 3Q11 4Q11 1Q12

AverageRental(R$/month)

69 65 65 67 71

Installed POS (thousand) 1.293 1.351 1.402 1.484 1.524

MDR 1Q11 2Q11 3Q11 4Q11 1Q12

Net MDR Debit

76 74 77 81 81

Net MDR Credit

122 117 118 119 119

26.2%

-2.9%

21.1%

9.7%

955.4927.8

735.1754.9

823.1

538,9 550,1 596,6669,0 673,7

196,2 204,8226,5

286,4 254,1

1Q11 2Q11 3Q11 4Q11 1Q12

Commissions Revenues (R$ million)

Credit Debit

268,4 265,1 272,3 296,1

342,9

1Q11 2Q11 3Q11 4Q11 1Q12

Equipment Rental (R$ million)

Page 33: 20120629 apresentação institucional junho atualizada

CIELO | PREPAYMENT OF RECEIVABLES

33

57.4%

-1.6%

120,8137,7

159,9

193,1 190,1

1Q11 2Q11 3Q11 4Q11 1Q12

Revenue of Prepayment of Receivables ex Adjustments (R$ million)

3.236,9 3.376,93.894,6

4.899,25.289,9

7,3% 7,2% 7,7%8,7% 9,3%

0,0%

2,0%

4,0%

6,0%

8,0%

10,0%

12,0%

14,0%

16,0%

18,0%

20,0%

-

1.000,0

2.000,0

3.000,0

4.000,0

5.000,0

6.000,0

1Q11 2Q11 3Q11 4Q11 1Q12

Prepayment of Receivables

Financial prepayment volume

% Prepayment over Credit Financial Volume

62,958,5

56,0 55,8 55,7

1Q11 2Q11 3Q11 4Q11 1Q12

Average Term (days)

Page 34: 20120629 apresentação institucional junho atualizada

CIELO | COSTS

34

Reduction of 2.1% of the unitcost excluding the subsidiariesand the additional brands fee

If the impact of depreciation is eliminated in the sameanalysis, the reduction wouldhave been 5.9%

Costs of services rendered

Depreciation and amortization

0.314 0.255 0.261

Unit per transaction

0.037 0.022

Reduction of 0.3% of the unitcost excluding the subsidiariesand the additional brands fee

If the impact of depreciation is eliminated in the sameanalysis, the reduction wouldhave been 4.0%

0.314 0.283 0.2840.037 +0.006

399.2

324.1

276.1

399.2370.1

359.9

17.4%

2.1%

0,3%

-2.8%

327,4

252,4 223,6

71,8 46,9

28,1 71,8

52,5

1Q12 Reported Costs related to subsidiaries

Additional brands fee 1Q12 Adjusted 1Q11 Adjusted

Costs Comparison 1Q12 X 1Q11 (R$ million)

327,4 288,1 307,7

71,8 46,9

7,6 71,8 62,4

1Q12 Reported Costs related to subsidiaries

Additional brands fee 1Q12 Adjusted 4Q11 Adjusted

Costs Comparison 1Q12 X 4Q11 (R$ million)

Page 35: 20120629 apresentação institucional junho atualizada

CIELO | EXPENSES

35

In both comparison(1Q11 x 1Q12 and4Q11 x 1Q12) themain impact for thereduction was due to marketing and salesexpenses.

207,9

129,9

0,3 (1.3) (5.6) (12.5)(58.8)

4Q11 Depreciation and

Amortization

Personnel Other Expenses General and Administratives

Marketing and Sales Expenses

1Q12

Operating Expenses Composition - 4Q11 to 1Q12 (R$ million)

139,9 129,9

6,7 3,6 0,6 (8,2)(12,6)

1Q11 Personnel Other Expenses Depreciation and

Amortization

General and Administratives

Marketing and Sales Expenses

1Q12

Operating Expenses Composition- 1Q11 to 1Q12 (R$ million)

Page 36: 20120629 apresentação institucional junho atualizada

CIELO | FINANCIAL PERFORMANCE

36

13.3%12.3%

Adjusted EBITDA (R$ million) Net Income (R$ million)

33.4%37.9%

684,3716,5 741,2

833,2943,8

63% 64%

61%60%

67%

45,00%

50,00%

55,00%

60,00%

65,00%

70,00%

75,00%

0,0

100,0

200,0

300,0

400,0

500,0

600,0

700,0

800,0

900,0

1.000,0

1Q11 2Q11 3Q11 4Q11 1Q12

Adjusted EBITDA Adjusted EBITDA Margin

424,7 423,6457,5

504,5

566,6

39%38% 38% 37%

41%

25,00%

30,00%

35,00%

40,00%

45,00%

50,00%

55,00%

60,00%

0,0

100,0

200,0

300,0

400,0

500,0

600,0

1Q11 2Q11 3Q11 4Q11 1Q12

Net Income Net Margin

Page 37: 20120629 apresentação institucional junho atualizada

CIELO | WHY INVEST?

Leader in a fast growing market

Strong balance sheet, high cash generation and low capex requirements

Minimum dividend payout of 50% of net profit*distributed twice a year

Focus on innovationand continuous growth

37

Page 38: 20120629 apresentação institucional junho atualizada

Investor Relations Contacts:

www.cielo.com.br/ri

Email: [email protected]

Phone.: + 55 11 2596 1701