Public Meeting 2Q11 ing

1

Localiza Day

August / 2011

2

1.The Company

2.Drivers and opportunities

3.Value creation

4.Conclusion

3

The Company: highlights

�Largest car rental network in South America with more than 460 locations in 7 countries

�Fleet of more than 100 thousand cars

�Flexible business model

�Proved growth and profitability track record

�Market share of 37.5% in the car rental and 12.5% in the fleet rental

�Stable management

�Top of mind

�High levels of corporate governance

�ADTV: over BRL 20 million

4

The Company: integrated platform

This integrated platform gives Localiza sinergies, flexibility and superior performance.

� 11,363 cars

� 188 locations in Brazil

� 43 locations in South America

� 30 employees

� 75.8% sold to final consumer

� 56 stores

� 787 employees

� 63,500 cars

� 2.5 million clients

� 236 locations

�3,641 employees

� 28,654 cars

� 698 clients

� 290 employees

Based on the 2Q11

Consolidated numbers:

� 103,517 cars

� 467 rental locations in 7 countries

� + 2.5 million customers

5

Funding

Equity

Flexible and liquid assets.

Cash to renew the fleet

Assets (cash)

Profitability comes fromrental divisions

Pricing strategy

Consumer price

(-) Operating costs

(-) Depreciation

(-) Taxes

(-) Interest

= income

As

se

ts (

ca

rs)

Debt

The Company: managing assets

6

2005 2006 2007 2008 2009 2010

The drivers and competitive advantages resulted in a superior growth compared to the sector’s growth.

Source: Central Bank, Localiza and ABLABased on the revenues of Localiza, Total Fleet and Franchisees, net of inflation

Rental revenues accumulated growth rate – rentals

5.5x

Localiza

GDP

Sector

2.8x

The Company: GDP elasticity

7

42 62 85.2134.3 154 149.9 152.1

197.8278.1 311.4

403.5

504.1469.7

649.5

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

212.9 234.3 244.7 310.1 420.4 476.9 532.0 634.4876.9

1,145.4

1,531.7

1,855.7 1,856.3

2,551.3

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Consolidated revenues

CAGR: 16.5%

-0.6 7.5

4.4

5.7 3.2 4.0 6.1 5.2

1.9Average

1.12.71.34.30.30.03.4GDP

CAGR: 23.9%

Consolidated EBITDA

CAGR: 25.1%

CAGR: 23.1%

The Company: track record of growth and profitability

Average growth of 25% p.a. in the last 6 years.

8Source: ABLA, 2011 yearbook

Market share in fleet size

37.5% 12.5%

The Company: market share

9

1.The Company


3.Value creation

4.Conclusion

10

Drivers and opportunities: car rental

11

Car rental

Macro strategy:To increase market leadership maintaining

high returns

12

151

260

465510

240180 200

350415

380

300

18% 16%

31%

35%

15%

37%38%

51%

22% 20%

27%

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Monthly minimum salary (R$) Daily rental price over minimum salary (%)

Income increase and stable rates resulted in the increase of the car rental affordability.

Car rental affordability

Source: website Portal Brasil and Bradesco (Macro economic scenario)

Car rental drivers: income

GDP per capita (R$ thds)

6.9 7.58.4

9.510.7

11.712.8

14.2

16.0 16.6

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

13

Strong growth of the domestic market.

# of air traffic passengers (million)

71

128154

2003 2009 2010

Source: Infraero, Gol, Abecs and Exame magazine (Dec/2010)

Middle class (million)

66

98113

2003 2009 2014e

48.5%15.3%

Credit car holder (million)

15

45 51

2003 2009 2010e

200.0%13.3%

80.3% 20.3%

Car rental drivers: consumption

14

Infrastructure investments have a positive impact in rental volumes.

Source: BNDES 2010-2014, Ernani Torres (Director),

196337

131

210206

339

2006-2009 2011-2014

Construction Infrastructure Industry

+ 66%R

$ B

illio

n 533

886

Investiment 2011-2014

Car rental drivers: investiments

15

Avis

31

Unidas

73

Localiza

326 Hertz

67

Others

2004

Brazilian distribution

97

91

64

424

252

Source: each company’s website (June, 2011)

289

64 7246

Localiza Hertz Unidas Avis

# of locations

# of cities

Markets

Airport

Off-airport

Others

30Avis

33

Unidas

18

Localiza

98

Hertz

30

Car rental opportunities: consolidation

217 cities where competition is not present. Fragmented off-airport market.

16

Network increase

39Total

locationsLTM

22Franchised

17Owned

The rental network is still being increased.

Brazilian distribution

# of agencies in Brazil

279 312346

381415 424

254

2005 2006 2007 2008 2009 2010 1H11

Car rental opportunities: consolidation

17

2010 new rental locations

18

Cidade Administrativa BH – Minas Gerais

19

Varginha – Minas Gerais

20

Três Corações – Minas Gerais

21

São João Del Rei Aeroporto – Minas Gerais

22

Belo Horizonte Barreiro – Minas Gerais

23

Terminal provisório Jeceaba – Minas Gerais

24

Jundiaí Aeroporto – São Paulo

25

Guaratinguetá – São Paulo

26

Itanhaém – São Paulo

27

Shopping Ibirapuera – São Paulo

28

Top Center – São Paulo

29

Shopping Butantã – São Paulo

30

SP Market – São Paulo

31

Carrefour São Gonçalo – Rio de Janeiro

32

Carrefour Barra da Tijuca – Rio de Janeiro

33

Terminal rodoviário Brasília – DF

34

Brasília Aeroporto TPSII – DF

35

Terminal rodoviário Campo Grande – Mato Grosso do Sul

36

Curitiba terminal rodoferroviário – Paraná

37

Curitiba Batel – Paraná

38

Pituba – Bahia

39

2011 new rental locations

40

Belo Horizonte Via Expressa – Minas Gerais

41

Belo Horizonte Barão – Minas Gerais

42

Porto Alegre Aeroporto TPSII – Rio Grande do Sul

43

Morumbi – São Paulo

44

Varginha Aeroporto – Minas Gerais

45

Average rented fleet (quantity)

Net revenues (R$ million)

472.4357.9

802.2585.2565.2

428.0346.1

258.6

2005 2006 2007 2008 2009 2010 1H10 1H11

CAGR: 25.2%

34,738

12,84215,937

21,848 22,210

29,646 27,093

9,402

2005 2006 2007 2008 2009 2010 1H10 1H11

CAGR: 25.8%

32.0%

28.2%

Car rental results

46

EBITDA (R$ million)

213.0150.2

196.8259.3 245.2

363.3

158.8122.8

2005 2006 2007 2008 2009 2010 1H10 1H11

CAGR: 24.2%

34.1%

44.4%

1H10

45.1%

1H11

45.3%

2010

45.9%

2008

41.9%

2009

43.4%

2006

46.0%

2007

47.5%Car rental

2005

EBITDA margin

Car rental results

47

Drivers and opportunities: fleet rental

48

Fleet rental

Macro strategy:To generate value taking advantage of the

fleet rental market opportunities, leveraging the synergies generated by the business model.

49Source: ABLA and Company’s estimates

Corporate fleet

232,000

2,000,000

Corporate Fleet Rented fleet

Fleet rental drivers: outsourcing trend

50

Targeted market

Fleet rental opportunities: potential market

500,000

28,654

Targeted fleet

Source: ABLA and Company’s estimates

51

9,308 11,635 14,295 17,880 19,720 22,343 21,200 25,694

2005 2006 2007 2008 2009 2010 1H10 1H11

CAGR: 19.1%

142.0184.0

219.8268.4 303.2

361.1

167.3215.7

2005 2006 2007 2008 2009 2010 1H10 1H11

CAGR: 20.5%

28.9%

21.2%

Fleet rental results

Average rented fleet (quantity)


52

144.8131.4

156.8185.4 208.4

245.6

111.393.0

2005 2006 2007 2008 2009 2010 1H10 1H11

CAGR: 21.4%

30.1%

66.5%

1H10

67.1%

1H11

68.0%

2010

69.1%

2008

68.7%

2009

71.4%

2006

71.3%

2007

65.5%Fleet rental

2005

Fleet rental results

EBITDA (R$ million)

EBITDA margin

53

Seminovos

54

Seminovos

Macro strategy:To add value as a competitive differential optimizing fleet renewal and minimizing

depreciation cost

55

Income increase and credit availability are the main drivers of the car sale.

Car purchase affordability

Source: Bradesco, GDP per capita: IPEADATA.

6.9 7.58.4

9.510.7

11.712.8

14.216.0 16.6

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

GDP per capita (R$ thousand)

Seminovos drivers : income

148128

11597 104

9380

56586875

151 180 200240 260

300350

510465

380415

0

2 0

4 0

6 0

8 0

1 00

1 2 0

1 4 0

1 6 0

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

0

1 00

2 00

3 00

4 00

5 00

6 00

Number of minimum wages to buy a new car Monthly minimum salary (R$)

56

1.2

1.5

1.7

1.7

1.9

4.0

6.9

USA

Italy

France

England

Germany

Mexico

Brazil

Low penetration of cars per inhabitants.

# of inhabitants per car

Source: 2010 Bradesco report.

Seminovos opportunities: inhabitants/car

57

Used car sales network is being enlarged to support fleet renewal.

Brazilian distribution Network distribution

StoresStatus

10Locations being prospected

6Construction to begin

6Stores in construction

# of stores

2632 35

4955 56

13

2005 2006 2007 2008 2009 2010 1H11

Seminovos opportunities: network increase

58

Seminovos stores recently opened

59

Sertório - Porto Alegre

Before

60

Sertório - Porto Alegre

61

Caxias do Sul – Rio Grande do Sul

Before

62


63


64

Belo Horizonte – Minas Gerais

Before

65


66


67


68

Tijuca – Rio de Janeiro

Before

69


70


71

Niterói – Rio de Janeiro

Before

72

Niterói – Rio de Janeiro

73

Maceió – Alagoas

Before

74

Maceió – Alagoas

75

Maceió – Alagoas

76

Maceió – Alagoas

77

Brazilian market: fleet

9.3 9.3 9.3

9.59.4

8.78.8

9.0

2003 2004 2005 2006 2007 2008 2009 2010

Average fleet age (years)

Stable Renewal

Source: Sindipeças and Abipeças (Autos, light vehicles, trucks and busses)

78

3.6

3.1

2.8

2.3

1.8

1.2 1.3 1.4 1.31.1

1.3

1.61.4 1.3

1.00.8

0.5 0.5

1.31.51.6

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 +

29% of the fleet has 3 years of

usage

Volume per age(units - million)

Brazilian market: fleet

Source: Sindipeças and Abipeças (Autos, light vehicles, trucks and busses)

79

Ratio: used X 0KM

Used car x new car market

3.0 2.72.3 2.5 2.5

2007 2008 2009 2010 2011

Source: Fenabrave

80

0km SeminovosUsed cars Seminovos Used cars until 3 years Seminovos

47,285 = 1.44% 47,285 = 4.40%

Until 3 yearsUntil 3 years

1,093,2811,093,281

Seminovos: market share

Source: Fenabrave 2010

0KM0KM

3,329,1703,329,170

47,285 = 0.57%

Used carsUsed cars

8,429,3098,429,309

Seminovos market share x car market

81

Financed portfolio in number of installments

Seminovos: financing

“Macro prudential” measures impacted the average financing term.

12%

23%

6%7%7%8%7%8%5%

14%15%14%16%17%

10%

21%22%23%

25%24%

12%

58%58%

72%

51% 52%

54% 56%

2010 11-Jan 11-Feb 11-Mar 11-Apr 11-May 11-Jun

less than 36 months 36 months 48 months 60 months

82

Financed In cash

Sales profile

61%49% 52%

39%51% 48%

2010 1Q11 2Q11

Seminovos: financing

“Macro prudential” measures impacted the sales profile.

83

Newspaper

Seminovos: marketing campaign

84

Outdoor

Seminovos: marketing campaign

85

3,940 3,860

4,159 4,223

2010 1Q11 2Q11 Jul-11

Seminovos: used car sales evolution

Average number of cars sold per month

Sales increase direved from the opening of new stores.

86

18,76323,174

30,09334,281 34,519

24,05921,627

47,285

2005 2006 2007 2008 2009 2010 1H10 1H11

# of cars sold (quantity)


CAGR: 20.3%

11.2%

Seminovos results

693.3585.3

922.4980.8850.5

588.8446.5

1,321.9

2005 2006 2007 2008 2009 2010 1H10 1H11

CAGR: 24.2%

18.5%

87

1.The Company


3.Value creation

4.Conclusion

88

Value creation

Positivespread

Income growth

Capacity tosustain

Value creation

89

ROIC

Cost of debt

Value creation

Positivespread

Income growth

Capacity tosustain

Value creation

90

7.7p.p. spread in spite of the increase in the base interest rate.

7.3

7.8%

15.1%

0.55x

27.2%

1,913.2

1H10

9.1

7.8%

16.9%

0.59x

28.6%

1,984.6

2010

8.8

8.2%

17.0%

0.53x

32.1%

1,642.3

2008

3.7

7.8%

11.5%

0.53x

21.9%

1,702.3

2009

7.712.97.811.2Spread (ROIC – Interest after tax) - p.p.

8.9%8.4%10.9%13.6%Interest on debt after tax

16.6%21.3%18.7%24.8%ROIC

0.58x0.58x0.55x0.67xTurnover of average capital investment (over rental net revenues)

28.3%36.9%34.5%37.0%NOPAT margin (over rental net revenues)

2,375.01,137.5 986.2 606.3 Avergage capital investment - R$ million

1H11200720062005

7.8% 8.9%

15.1% 16.6%

13.6%10.9% 8.4% 8.2% 7.8% 7.8%

16.9%11.5%

24.8%18.7%

21.3%17.0%

2005 2006 2007 2008 2009 2010 1H10 1H11

Interest on debt after tax ROIC

11.2

7.8 12.98.8 3.7 9.1

7.77.3

Value creation: positive spread

91

Revenuesgrowth

Marginsmaintenance

Value creation

Positivespread

Income growth

Capacity tosustain

Value creation

92

Consistent EBITDA margins.

Revenues (R$ million)

1.6%

51.5%

66.5%

44.4%

1H10

3.7%

52.0%

67.1%

45.1%

1H11

2.6%

52.3%

68.0%

45.3%

2010

5.6%

53.3%

69.1%

45.9%

2008

51.1%54.5%52.9%53.6%Consolidated rental

1.1%

68.7%

41.9%

2009

4.6%

71.4%

43.4%

2006

5.5%

71.3%

46.0%

2007

13.2%Seminovos

65.5%Fleet rental

47.5%Car rental

2005EBITDA margin

Value creation: income growth

408.4 537.4 655.0 842.9 898.51,175.3

530.8 694.6

446.5588.8

850.5980.8 922.4

585.3693.3

1,321.9

2005 2006 2007 2008 2009 2010 1H10 1H11

Rental Seminovos

CAGR: 23.9%

854.91,126.2

1,505.51,823.7

1,116.1

1,820.9

1,387.9

2,497.2

24.4%

93

Competitiveadvantages

Positivespread

Income growth

Capacity tosustain

Value creation

Value creation

94

The Company has competitive advantages in all links of the rental process.

Value creation: capacity to sustainCompetitive advantages

FundingCar

rentalUsed car

salesCar

acquisition

Investment grade: lower spread, longer maturity

95

Value creation: capacity to sustain

FundingCar

rentalUsed car

salesCar

acquisition

Better conditions due to higher volumes



Competitive advantages

96


FundingCar

rentalUsed car

salesCar

acquisition



Know-howBrandDistributionScale



97


Lower depreciationBuffer

FundingCar

rentalUsed car

salesCar

acquisition


Know-howBrandDistributionScale




98

1.The Company


3.Value creation

4.Conclusion

99

Conclusion

Gains of scale

Higher competitiveness

� Integrated and synergic platform

� Drivers indicate growth opportunities

� Competitive advantages result in superior performance

� Proved growth and profitability track record

� High levels of corporate governance

Larger scale, higher competitiveness

100

Disclaimer

Thank you!

The material presented is a presentation of general background information about LOCALIZA as of the date of the presentation. It is information in summary form and does not purport to be complete. It is not intended to be relied upon as advice to potential investors. This presentation is strictly confidential and may not be disclosed to any other person. No representation or warranty, express or implied, is made concerning, and no reliance should be placed on, the accuracy, fairness, or completeness of the information presented herein.

This presentation contains statements that are forward-looking within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such forward-looking statements are only predictions and are not guarantees of future performance. Investors are cautioned that any such forward-looking statements are and will be, as the case may be, subject to many risks, uncertainties and factors relating to the operations and business environments of LOCALIZA and its subsidiaries that may cause the actual results of the companies to be materially different from any future results expressed or implied in such forward-looking statements.

Although LOCALIZA believes that the expectations and assumptions reflected in the forward-looking statements are reasonable based on information currently available to LOCALIZA’smanagement, LOCALIZA cannot guarantee future results or events. LOCALIZA expressly disclaims a duty to update any of the forward-looking statement.

Securities may not be offered or sold in the United States unless they are registered or exempt from registration under the Securities Act of 1933. Any offering of securities to be made in the United States will be made by means of an offering memorandum that may be obtained from the underwriters. Such offering memorandum will contain, or incorporate by reference, detailed information about LOCALIZA and its business and financial results, as well as its financial statements.

This presentation does not constitute an offer, or invitation, or solicitation of an offer, to subscribe for or purchase any securities. Neither this presentation nor

anything contained herein shall form the basis of any contract or commitment whatsoever.

Public Meeting 2Q11 ing

Education