Localiza Rent a Car S.A. 4Q13 and 2013 Earnings R$ million February 03, 2014
Localiza Rent a Car S.A. 4Q13 and 2013 Earnings
R$ million
February 03, 2014
240.9
384.3
86.1 90.0
2012 2013 4Q12 4Q13
535.7 575.9
137.9 142.9
2012 2013 4Q12 4Q13
1,093.7 1,163.5
290.3 310.4
2012 2013 4Q12 4Q13
2
Highlights
Net Revenues – Fleet Outsourcing Division Net Revenues – Car Rental Division
Net Revenues - Seminovos Consolidated Net Income
R$
millio
n
R$
millio
n
R$
millio
n
R$
millio
n
Record
1,520.0 1,747.3
362.6 505.6
2012 2013 4Q12 4Q13
Record cash flow generation.
346.1 428.0 565.2 585.2
802.2 980.7
1,093.7 1,163.5
290.3 310.4
2006 2007 2008 2009 2010 2011 2012 2013 4Q12 4Q13
4,668 5,793
7,940 8,062
10,734
12,794 13,749 14,242
3,560 3,714
2006 2007 2008 2009 2010 2011 2012 2013 4Q12 4Q13
3
Net Revenues (R$ million)
# Daily Rentals (thousands)
Car Rental division
Car rental revenues grew 6.4% in 2013
despite the scenario of lower economic activity growth.
4
Car Rental network evolution
14 new owned rental locations were added in 2013.
# of car rental locations (Brazil and abroad)
Localiza´s branches - Brazil Franchisees´ branches - Brazil Franchisses´ branches - abroad
145 178 199 214 234 247 272286134
134147
167181
202202 193
4869
7671
6147
50 63
2006 2007 2008 2009 2010 2011 2012 2013
327 381
422 452 476 496
524 542
+14
184.0 219.8 268.4
303.2 361.1
455.0 535.7
575.9
137.9 142.9
2006 2007 2008 2009 2010 2011 2012 2013 4Q12 4Q13
4,188 5,144
6,437 7,099 8,044
9,603 10,601 10,844
2,690 2,669
2006 2007 2008 2009 2010 2011 2012 2013 4Q12 4Q13
5
Net Revenues (R$ million)
# Daily Rentals (thousands)
Fleet Outsourcing division
In 2013 net revenues grew 7.5%, presenting a growth of 2.3% in daily rental volume and 4.3% in the average rental rate.
-0.8%
33,520 38,050 44,211 43,161
65,934 59,950 58,655
69,744
17,896 18,588 23,174 30,093
34,281 34,519
47,285 50,772 56,644 62,641
13,764 17,999
2006 2007 2008 2009 2010 2011 2012 2013 4Q12 4Q13
6
7,957 9,930 8,642
Net investment Fleet Expansion* (quantity)
Cars purchased Cars sold * It does not include theft / crashed cars.
Optimization of car purchases this quarter allowed an increase in the utilization rate
from 65.2% in 3Q13 to 68.1% in 4Q13.
Net Investment (R$ million)
Purchases (includes accessories) Used car sales net revenues
10,346
18,649 9,178 2,011
7.103
589 4.132
930.3 1,060.9
1,335.3 1,204.2
1,910.4 1,776.5
1,618.8
2,026.2
494.4 553.8 588.8
850.5 980.8 922.4
1,321.9 1,468.1 1,520.0
1,747.3
362.6
505.6
2006 2007 2008 2009 2010 2011 2012 2013 4Q12 4Q13
341.5 210.4
98.8
354.5 281.8
131.8 48.2
278.9 588.5 308.4
7
Sales by quarter Quantity
Strong car sales volumes in 4Q13 with no negative impact on the average car sales price.
# Number of cars sold
13,28514,504 15,091
13,764 12,934 13,669
18,039 17,999
1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13
Result of the OEM’s delays in
delivering cars
Record
62,641
31,373 35,686 39,112 47,517 61,445 64,688 65,086 70,717 14,630
17,790 23,403
22,778
26,615 31,629 32,104
32,809
6,730 7,602
9,526 8,791
10,652 12,958 14,545
14,233
2006 2007 2008 2009 2010 2011 2012 2013
8
52,733 61,078
72,041
Car Rental Fleet Outsourcing Franchising
79,086
98,712 111,735 109,275
117,759
End of period fleet Quantity
Own fleet:
103,526
The Company's owned fleet increased 6.5% to 103,526 cars in 12/31/2013.
537.4 655.0 842.9 898.5 1,175.3 1,450.0 1,646.7 1,758.9
432.9 458.3
588.8 850.5
980.8 922.4
1,321.9 1,468.1
1,520.0 1,747.3
362.6 505.6
2006 2007 2008 2009 2010 2011 2012 2013 4Q12 4Q13
9
Consolidated net revenues R$ million
1,126.2 1,505.5
1,823.7
2,918.1 3,506.2
1,820.9
2,497.2
3,166.7
Rental Seminovos
Consolidated net revenues increased 10.7% in 2013.
795.5 963.9
10
Consolidated EBITDA R$ million
311.3403.5
504.1 469.7
649.5
821.3 875.6 916.5
226.3 236.0
2006 2007 2008 2009 2010 2011 2012 2013 4Q12 4Q13
Excluding accessories and freight for new cars recorded in the cost line, Car Rental EBITDA margin would be 39.9% in 4Q13 and 39.3% in 2013.
Divisions 2006 2007 2008 2009 2010 2011 2012 2013 4Q12 4Q13
Car Rental 43.4% 46.0% 45.9% 41.9% 45.3% 46.9% 42.7% 39.3% 43.1% 39,9%
Fleet Outsourcing 71.4% 71.3% 69.1% 68.7% 68.0% 68.6% 67.2% 65.9% 67.8% 65,2%
Rental Consolidated 52.9% 54.5% 53.3% 51.1% 52.3% 53.8% 50.8% 48.2% 51.2% 48,0%
Used Car Sales 4.6% 5.5% 5.6% 1.1% 2.6% 2.8% 4.2% 5.7% 3.9% 4.9%
EBITDA margin excluding accessories and freight for new cars in 2012 and 2013:
2,383.3 2,395.8
5,083.14,371.7
3,509.74,133.0
4,311.3
4,592.31,096.9
2006 2007 2008 2009 2010 2011 2012 2013
939.1332.9
2,546.0 2,577.0
1,536.0 1,683.9
1,895.8
1,452.4
2,076.6
2006 2007 2008 2009 2010 2011 2012 2013
11
Average depreciation per car
in R$
Robust used-car market
Financial crisis and
IPI reduction effect
Robust used-car market
Financial crisis and
IPI reduction effect
Depreciation Non recurring additional depreciation - IPI Effect
Depreciation Non recurring additional depreciation - IPI Effect
3,972.4
5,408.2
138.2190.2
127.4 116.3
250.5291.6
240.9
384.3
86.1
90.0
2006 2007 2008 2009 2010 2011 2012 2013 4Q12 4Q13
12
Consolidated net income R$ million
* Pro forma 2012 net income excluding additional depreciation, net of income tax.
336.3 *
Record
95.2 *
Strong net income growth even in a lower-growth scenario.
13 13
Free cash flow
(*) Without the technical discount up to 2010
Free cash flow - R$ million 2006 2007 2008 2009 2010 2011 2012 2013
EBITDA 311.3 403.5 504.1 469.7 649.5 821.3 875.6 916.5
Used car sale revenue, net from taxes (588.8) (850.5) (980.8) (922.4) (1,321.9) (1,468.1) (1,520.0) (1,747.3)
Depreciated cost of cars sold (*) 530.4 760.0 874.5 855.1 1,203.2 1,328.6 1,360.2 1,543.8
(-) Income tax and social contribution (42.7) (63.4) (52.8) (49.0) (57.8) (83.0) (100.9) (108.5)
Change in working capital (4.8) 13.3 (44.8) (11.5) 54.5 (83.9) 37.1 2.9
Cash provided before investment 205.4 262.9 300.2 341.9 527.5 514.9 652.0 607.4
Used car sale revenue, net from taxes 588.8 850.5 980.8 922.4 1,321.9 1,468.1 1,520.0 1,747.3
Car investment for renewal (643.3) (839.0) (1,035.4) (947.9) (1,370.1) (1,504.5) (1,563.3) (1,818.7)
Net investment for fleet renewal (54.5) 11.5 (54.6) (25.5) (48.2) (36.4) (43.3) (72.4)
Fleet renewal – quantity 23,174 30,093 34,281 34,519 47,285 50,772 56,644 62,641
Investment, other property and intangibles
investments (32.7) (23.7) (39.9) (21.0) (51.1) (63.0) (80.2) (54.0)
Free cash flow before growth and before interest 118.2 250.7 205.7 295.4 428.2 415.5 528.5 481.0
Investment on cars for fleet (growth) /reduction (287.0) (221.9) (299.9) (241.1) (540.3) (272.0) (55.5) (209.4)
Change in accounts payable to car suppliers 222.0 (51.0) (188.9) 241.1 111.3 32.7 (116.9) 89.7
Fleet growth (65.0) (272.9) (488.8) 0.0 (429.0) (239.3) (172.4) (119.7)
Fleet increase / (reduction) – quantity 10,346 7,957 9,930 8,642 18,649 9,178 2,011 7,103
Free cash flow after growth and before interest 53.2 (22.2) (283.1) 295.4 (0.8) 176.2 356.1 361.3
14
Changes in net debt R$ million
- 1,332.8 (110.6)
Financial expenses
(65.5)
Dividends (*)
Net debt
12/31/2013
FCF 361,3
-1,231.2
Net debt
12/31/2012
FCF after financial
expenses
250.7
(36.8)
Company’s share buybacks
(250.0)
Extraordinary dividends
(*) Includes interest own capital paid in the period
R$250 million extraordinary dividend paid in 2013.
315,5
15
Debt maturity profile (principal) R$ million
The Company maintains a strong cash position and comfortable debt maturity profile.
-
245.9 185.7
641.4 511.0
221.0 247.0
100.0 100.0
2013 2014 2015 2016 2017 2018 2019 2020 2021
Cash
1,010.7
1,073.0
16
Debt - ratios
Net debt vs. Fleet value
BALANCE AT THE END OF
PERIOD 2006(*) 2007(*) 2008(*) 2009(*) 2010(*) 2011 2012 2013
Net debt / Fleet value 36% 51% 72% 57% 52% 51% 48% 48%
Net debt / EBITDA 1.4x 1.9x 2.5x 2.3x 2.0x 1.7x 1.4x 1.5x
Net debt / Equity 0.7x 1.3x 2.0x 1.5x 1.4x 1.2x 0.9x 1.0x
EBITDA / Net financial expenses 4.8x 5.4x 3.8x 4.2x 5.0x 4.6x 6.3x 8.3x
(*) From 2006 to 2010, ratios based on USGAAP financial statements.
Net debt Fleet value
Comfortable debt ratios.
440.4 765.1
1,254.5 1,078.6
1,281.1 1,363.4 1,231.2 1,332.8 1,247.7 1,492.9
1,752.6 1,907.8
2,446.7 2,681.7 2,547.6 2,797.9
2006 2007 2008 2009 2010 2011 2012 2013
17
ROIC versus cost of debt after taxes
10.9% 8.4% 8.8% 7.6% 7.3% 8.6% 6.3% 6.0%
18.7%21.3%
17.0%
11.5%
16.9% 17.1% 16.1% 16.5%
2006 2007 2008 2009 2010 2011 2012 2013
7.8p.p. 12.9p.p. 8.2p.p. 4.0p.p.
9.6p.p. 8.5p.p. 10.5p.p. 9.8p.p.
Adding value to shareholders is the Company’s main goal.
ROIC Cost of debt after taxes
Financial crisis effect
18
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 projections 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’s
management, 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, invitation or solicitation of an offer to subscribe to or purchase any securities. Neither this presentation nor anything
contained herein shall form the basis of any contract or commitment whatsoever.
www.localiza.com/ir
E-mail: [email protected]
Tel: +55 31 3247-7024