Presentation 1Q14

Earnings Call 1Q14

May 14th, 2014

The consolidated financial statements presented here are consistent with the criteria of international accounting standards - IFRS issued by the

International Accounting Standards Board – IASB, based on audited financial information. Non-financial information contained herein, as well

as other operational information, were not audited by independent auditors and may include forward-looking statements and reflects the

current views and perspectives of the management on the evolution of macro-economic environment, conditions of the mining and

refractories industries, company performance and financial results. Any statements, projections, expectations, estimates and plans contained

in this document that do not describe historical facts, and the factors or trends affecting financial condition, liquidity or results of operations,

are forward-looking statements and involve several risks and uncertainties.

This presentation should not be construed as legal, tax, investment or other advice. This presentation does not constitute an offer, or invitation,

or solicitation of an offer, to subscribe for or purchase any securities, and neither any part of this presentation nor any information or

statement contained herein shall form the basis of or be relied upon in connection with any contract or commitment whatsoever. Under no

circumstances, neither the Company nor its subsidiaries, directors, officers, agents or employees be liable to third parties (including investors)

for any investment decision based on information and statements in this presentation, or for any damages resulting therefrom, corresponding

or specific.

The information presented or contained in this presentation is current as of the date hereof and is subject to change without notice. Magnesita

has no obligation to update it or revise it in light of new information and / or in face of future events, safeguard the current regulations which

we are submitted to. This presentation and its contents are proprietary information of the Company and may not be reproduced or circulated,

partially or completely, without the prior written consent of the Company.

Changes in historical numbers For comparison purposes, 4Q13 and 1Q13 figures have been adjusted to reflect accounting changes implemented by the Company in late 2013.

Disclosure

A g

lob

al o

rgan

izat

ion

New Strategic Vision

Vision: Be the best provider of refractories solutions and industrial minerals,

leveraging and developing our minerals base

Expand industrial minerals base

Ensure leadership in our core markets

Maintain a global low cost production base

Grow selectively and aggressively

Continue to develop high quality, low cost raw material sources to support our current

businesses as well as new businesses where

we can have a sustainable competitive

advantage

Strive to keep offering high quality and

innovative products, unrivaled services and

cost performance

Optimize production globally to improve

efficiency and support growth

Develop global supply chain management

Pursue long term growth opportunities in selected

markets where we can deliver superior value to

our customers and shareholders

▪Meritocracy ▪Ethics

▪Profit ▪Management & Method

▪Agility and Transparency ▪Respect for Safety, Environment and Communities

▪Customer ▪People

Our values

3

South America

4

Source: ¹WSA

Crude Steel Production¹ (million tons) - Main markets

Volume (000’ tons)

North America EU-28

Sales to Steel Segment

Revenues (R$ million)

214222203

-3%

+5%

1Q14 4Q13 1Q13

517529425

4Q13

-2%

+22%

1Q14 1Q13

Refractory Solutions Sales - Steel

-4%

1Q14

0%

1Q13 4Q13

12 11 11 29

1Q13

30

4Q13 1Q14

30

0%

+1%

+4%

1Q13

42

1Q14

41

+7%

4Q13

44

23%

38%

24% 22%

12% 14%

41%

26%

Sales by region (R$)

South America

North America

Europe Others

1Q13

1Q14

5

Sales to Industrial Segment

Refractory Solutions Sales – Industrial Segment

Volume (000’ tons) Revenues (R$ million)

+1%

-12%

1Q14

44

4Q13

43

1Q13

49

+4%

+5%

1Q14

125

4Q13

121

1Q13

120


163158

LTM 1Q14

+3%

LTM 1Q13

436383

LTM 1Q14

+14%

LTM 1Q13

22%

46%

26%

14% 14% 13%

51%

14%

1Q13

1Q14

South America

North America

Europe Others

Refractory Solutions Sales and Margin - Consolidated

6

Volumes (000’ tons)

Revenues (R$ million)

Gross profit and margin (R$ million; %)

253 265

-3%

4Q13 1Q13 1Q14

+2%

258

203

4Q13

213

33.1% 31.2%

1Q13

+5%

1Q14

+10%

194

34.6%

1Q14 4Q13

544

+18%

650 642

-1%

1Q13


23%

39%

25%

20%

13% 14%

43%

23%

South America

North America

Europe Others

1Q13

1Q14

21%

80%

20%

79%

Steel Industrial

1Q13

1Q14

Sales by segment (R$)

7

Revenues (R$ million) Gross profit and margin (R$ million; %)

Revenues (R$ million) Gross profit and margin (R$ million; %)

Minerals and Services

-28%

+20%

1Q14

38

4Q13

54

1Q13

32

+19%

+35%

1Q14

39

4Q13

32

1Q13

29

-36%

-4%

1Q14

12

30.6%

4Q13

18

34.4%

1Q13

12

38.0%

+28%

+97%

1Q14

6

16.6%

4Q13

5

15.6%

1Q13

3

11.4%

Minerals

Services

8

Consolidated Sales (R$ million)

Por Segmento

1Q13

622

+16%

-2%

1Q14 4Q13

719 736

89.3%

5.3% 5.4% 4.6%

90.2%

5.2%

Services Minerals Refractories

1Q13 1Q14

Per segment

Quarters

9

Selling, General and Administrative Expenses (SG&A)

Selling expenses

G&A

5665

51

1Q14

7.8%

4Q13

8.8%

1Q13

8.1%

1069974

+7%

+43%

1Q14

14.8%

4Q13

13.4%

1Q13

11.9%

Selling expenses

% of sales

46

3729

1Q14

6.5%

4Q13

5.0%

1Q13

4.6%

Consolidated Freight

G&A

% of sales

Others

6062

45

1Q14

8.3%

4Q13

8.4%

1Q13

7.3%

10

Gross profit, EBITDA and Net Income (R$ million)

Gross profit

EBITDA and ADJUSTED EBITDA (excluding other revenues/expenses)

Net Income

ADJUSTED

+2%

+10%

1Q14

231

32.1%

4Q13

226

30.7%

1Q13

210

33.7%

98124116

13.7%

4Q13

16.8%

1Q13

18.7%

-20%

-15%

1Q14

-17

3126

1Q14

-2.3%

4Q13

4.2%

1Q13

4.2%

10498114

-9%

+6%

1Q14

14.4%

4Q13

13.3%

1Q13

18.3%

11

CAPEX and working capital (R$ million)

Working capital

CAPEX

-68%

+14%

1Q14

27

4Q13

83

1Q13

23

1Q14

1,017

35.4%

4Q13

952

32.3%

3Q13

976

37.7%

2Q13

934

35.9%

1Q13

877

35.2%

Working capital

% of sales

12

*EBITDA excluding other revenues/expenses

Debt and Leverage

Total

Amortization Schedule (R$ million) Net Debt per currency

Excluding Perpetual Bond

59%

BRL

Others 0%

USD

0%

36%

EUR 19%

17%

44%

24%

915875819658

551421439398406388

2.1x 1.5x

2.4x 2.2x

2.0x 1.7x

1.7x

1Q13

2.1x

1Q14 2Q13

2.2x

4Q13 3Q13

1.4x

Net debt / EBITDA w/o ORE*

Net debt / EBITDA

EBITDA

Net debt

2017

281

mar-14

1.513

819

213

2016

578

2018

84

2015

192

2014

18

2020+ 2019

12

935

Perpetual bond Cash position Amortization

4Q13

1Q14

421438384386367

1,494

3.9x

3.5x

4Q13

1,453

3.7x

3.3x

3Q13

1,369

3.7x

3.6x

2Q13

1,205 1,059

2.8x

2.9x 3.2x

3.1x

1Q13 1Q14

EBITDA Net debt / EBITDA w/o ORE*

Net debt / EBITDA Net debt

*EBITDA excluding other revenues/expenses

Octavio Pereira Lopes CEO

Eduardo Gotilla Global Finance and IRO

Daniel Domiciano Silva Investor Relations

Lucas Veiga Investor Relations Analyst

Phone: +55 11 3152-3237/3241/3202 [email protected]

www.magnesita.com/ri

13

Investor Relations Contacts

Presentation 1Q14

Business