Presentation 4 q09
- 1. Results Presentation | 4Q09
- 2. Disclaimer “ Forward looking statements included in this presentation regarding the Company’s business, operating and financial results and Company’s growth are only predictions and were based on management's expectations regarding future performance. These expectations are highly dependent on market conditions, Brazilian economic scenario, industry performance and international markets, and are therefore subject to change ” 2
- 4. Supply Chain 4
- 5. Plants Location Filiais de vendas Commercial Branches 1) Anápolis/GO; 2) Colombo/PR; 3) Goiânia/GO; 4) Rio de Janeiro/RJ; 5) Simões Filho/BA; 6) Porto Alegre/RS and 7) São Paulo/SP. 5
- 6. Time Line Eternit’s most important accomplishments since its foundation in 1940. 6
- 8. Global Market – Chrysotile Asbestos Major World Producers – 2009 Global Consumption (MM of Ton) Russia 45% 2009 2.1 China 22% 2008 2.4 Brazil* 14% 2007 2.4 Kazakhstan 10% 2006 2.3 Canada 8% 2005 2.3 Zimbabwe 1% 2004 2.1 * SAMA MINERAÇÃO (Minaçu/GO): Third largest in the world and first with ISO 14.001 8
- 10. Sales of Chrysotile Asbestos (thous. tons) 303.8 291.0 80.2 75.9 77.2 70.5 77.7 74.1 69.2 70.0 29.0 31.7 36.2 31.7 31.9 32.0 30.9 36.6 51.2 44.2 45.5 38.5 42.2 38.3 41.5 33.4 1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 3Q09 4Q09 Domestic Market Foreign Market Changes Domestic Market Foreign Market Total 4Q09/4Q08 + 13.1% + 7.5% + 10.1% 2009/2008 + 9.1% - 13.4% - 4.2% 10
- 12. Products and solutions for civil construction Water tanks and Roof filters coverings Components for Bathroom chinaware construction systems fixtures 12
- 13. Covering market – Brazil (2009) Residential Market Industrial and Commercial Market Others Others Ceramics Fiber cement 2% Ceramics 12% 14% 52% 43% Fiber cement Metallic Concrete 39% 35% 3% Total Market Market Evolution (MM m2) Others Concrete 10% -2% 4% 3% 8% Ceramics 5% 35% 505 495 459 425 406 Fiber cement Metallic 49% 9% 2005 2006 2007 2008 2009 13
- 14. Brazilian Fiber Cement Market Structure of the Industrial Park in 2009 Installed capacity: Approx. 2,820,000 tons / year Brazilian Capacity utilization - around 86% Consumption: Approx. 2,434,000 tons / year Fiber Cement Companies: 11 Market Plants: 19 Selling points: 35,000 Installed Capacity: 850,000 tons/year Capacity utilization - around 86% Consumption: 731,000 tons/year ETERNIT Market-share: 30% Plants: 5 Selling Points: 12,000 14
- 15. Eternit Competitive Advantages Products and solutions for civil construction 15
- 16. Sales of Fiber Cement (thous. tons) 725.4 730.6 207.2 195.4 185.0 186.4 176.5 177.5 167.2 160.8 1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 3Q09 4Q09 Changes Total 4Q09/4Q08 + 4.8% 2009/2008 + 0.7% 16
- 17. Operating and Financial Aspects
- 18. Consolidated Net Revenue (in R$ million) 7% 582.0 544.2 451.8 424.4 2% 156.4 153.0 144.8 146.9 135.8 126.0 129.4 133.9 114.1 127.9 101.7 121.8 108.5 100.4 97.2 104.1 130.2 119.8 38.9 43.1 28.8 33.5 28.5 25.3 27.3 25.1 1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 3Q09 4Q09 2008 2009 Domestic Market Foreign Market 18
- 19. Consolidated Net Revenue Net Revenue by Brazilian Regions (2009) Breakdown Net Revenue (4Q09) Molded products, constructive systems, metallic roof, water tanks and bathroom chinaware fixtures Fiber Cement Export Southeast Roofing 10.2% 22% 30% 56.0% North and 33.8% Northeast South 15% Midwest Chrysotile 18% Asbestos 15% 19
- 20. Breakdown of COGS (4Q09) Fiber Cement Chrysotile Asbestos Workforce Depreciation Raw 11% Depreciation 4% Others Material (*) 3% 11% 63% Energy 7% Others 19% Energy Workforce 4% Materials (**) 49% 29% (*) Raw Material: cement (48%), chrysotile asbestos (41%) and others (11%). (**) Materials: fuel, explosives, packaging, among others. 20
- 21. EBITDA (in R$ million) -7% 133.4 123.5 -28% 42.0 35.6 32.6 29.6 29.2 29.9 30.1 27.8 1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 3Q09 4Q09 2008 2009 21
- 22. Net Income (in R$ million) -10% 81.2 -34% 73.2 26.1 21.6 18.7 19.4 16.9 17.3 17.0 17.2 1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 3Q09 4Q09 2008 2009 22
- 23. Margins 47% 45% 44% 44% 43% 43% 40% 41% 27% 25% 25% 23% 22% 22% 20% 19% 17% 15% 15% 15% 12% 13% 12% 11% 1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 3Q09 4Q09 Gross Margin EBITDA Margin Net Margin 23
- 24. CAPEX CAPEX (R$ million) Breakdown of CAPEX (4Q09) 65 Quality and development -56% 28 28 Occupational 14% Productivity/ safety Capacity 12% 34% 3 29 30 % 34 29 Administrative Maintenance Technology 10% 27% 3% 2008 2009 Capacity Increase - Eternit Capacity Increase - SAMA Other Investments 24
- 25. New production lines of finished products At Goiânia / GO – Launched in April 2008. At Colombo / PR – Launched in January 2009. 25
- 26. Capital Markets
- 27. Eternit’s Shares Performance (Dec/06 - Feb/10) Between 12/30/2006 and 02/26/2010, Eternit”s shares appreciated 28.5% and IBOVESPA appreciated 49.5%. In the same period, including the payment of dividends and interest on own capital, Eternit’s shares appreciated 100.9%. ETER3 200 IBOVESPA 160 66,503 120 R$ 8.69 80 40 dec-06 jun-07 dec-07 jun-08 dec-08 jun-09 feb-10 27
- 28. Liquidity Shareholders Average Volume Traded (R$ thousand) 3,708 7,726 7,317 6,615 6,457 2,900 1,297 1,127 2,482 1,108 2006 2007 2008 2009 2010(*) 2006 2007 2008 2009 2010(*) (*) Until February 2010 28
- 29. Ownership Structure – February 2010 5% 37% 56% 2% Individual Investors (6.159 shareholders) Corporations (90 shareholders) Investors Abroad (50 shareholders) Clubs, Funds and Foundations (158 shareholders) Shareholders with more than 5% stake Geração L. Par. Fund. Invest. em Ações 17.99% Luiz Barsi Filho 9.86% Free Float 64.1% Victor Adler 6.59% 29
- 30. Return to Shareholders (Dec/06 - Mar/10) Net Income X Return to Shareholders (R$ million) Dividend Yield 15.1% 81 73 12.8% 65 55 8.6% 44 40 18 2.3% 2007 2008 2009 2010 2007 2008 2009 2010 Net Income Return to Shareholders 30
- 31. Outlook
- 32. Structured Program of Expansion and Diversification OBJECTIVE Establish Eternit as a company which provides products and solutions for the building sector INITIATIVES - Creation of Development and New Business Management - Inclusion of metallic roof coverings in its portfolio - Investment in new Eternit fiber cement production lines - Investment in machinery for the manufacturing of new products in existing plants - Expansion to capacity at SAMA - Launching of new products - Entry into the bathroom fixtures segment - Inorganic growth - Acquisitions 32
- 33. Structured Program of Expansion and Diversification Fiber Cement Sales (thousand tons) CAGR (2004/2009) = 11% 850.0 731.2 725.3 730.0 650.0 650.0 650.0 650.0 620.3 578.3 522.5 431.3 2004 2005 2006 2007 2008 2009 Sales Installed Capacity 33
- 34. Structured Program of Expansion and Diversification Chrysotile Asbestos Sales (thousand tons) CAGR (2004/2009) = 3% 300.0 303.8 295.0 290.1 270.0 270.0 270.0 272.6 270.0 248.8 231.3 221.6 2004 2005 2006 2007 2008 2009 Sales Installed Capacity 34
- 35. Launches - 2009 Bathroom Components for Colored fiber chinaware construction systems cement roof fixtures and filters coverings 35
- 36. Corporate and Environmental Management
- 37. Corporate Management Open Doors Program Launch ................... November 2004 Contribute to society’s better understanding of the mining and processing of chrysotile asbestos Purpose ................. and the manufacture of fiber cement products in a sustainable manner. Five production plants of Eternit and the SAMA Location ................ mining company Visitors ................. More than 36,000 as of February 2010 Target .................... All society 37
- 38. Environment Focused Management Zero Reject Monitoring Air Water Reuse Reforestation Quality Work Quelônios Project - Animal Conservation Area Seedling The only breeding program of Amazon turtles in Brazil and Nursery Reintegration of Wild Animal Nature in partnership with IBAMA 38
- 39. Filtration System Air Latin America's largest with more than 17 thousand filter sleeves 39
- 40. Environment Focused Management About 80% of the 4,500 hectares of the Cana Brava Moutains are maintained as Forest Reserve by SAMA. Monitored area 40
- 41. Social Actions - External Public Brincar pra Valer Project! – It aims to show the children of a sub-prefecture of São Paulo, that their dreams can come true through thematic workshops and recycling. Lar Escola São Francisco - Eternit contributes to LESF in order to rehabilitate children and adults with special needs in order to their physical recover, their educational and social integration Publication and distribution of books in braille and audio books - In partnership with the Dorina Nowill Foundation, Eternit distributed in the vicinity of their units, more than 6 million copies in order to facilitate access to the blind. 41
- 42. Social Actions - External Public Sambaíba Project – SAMA develops this project to a give young people a career through craft workshops with the reuse of waste rock extracted from the mine. Terra Mirim Project – Eternit has partnered with the NGO Terra Mirim to promote the training of young people of Simões Filho and region to act as guides that will be inserted in a project of an ecological track to be implemented soon in the environmental reserve of this unit. Sociedade dos Queimados - Eternit contributes to society of burning in order to promote the social reintegration of victims of fire burns, especially those from low-income segment, providing a better quality of life. 42
- 43. Recreational Clubs - Workforce Minaçu - GO Goiânia - GO Anápolis - GO Rio de Janeiro - RJ Simões Filho - BA Colombo - PR 43
- 44. Chrysotile – The Brazilian Asbestos
- 45. Chrysotile – The Brazilian Asbestos The use of chrysotile asbestos in Brazil is regulated by the Federal Law 9.055/95, by Decree 2.350/97 and by regulatory standards for occupational health and safety. It is also provided in the Convention 162 of the International Labor Organization (OIT). White Asbestos Bends and silky fibers without tip High Concentration of Magnesium:3MgOSiO2H2O Biopersistence*: 2.5 days *Biopersistence: Time that a inhaled particle remains in the lungs before being eliminated by the body’s defense mechanisms. To cause lung damage, the fiber must have penetration and durability capacities in the alveoli. Rocha de serpentinito com fibras de amianto crisotila 45
- 46. Novelties 46
- 47. Shareholders' Meeting via WEB www.eternit.com.br/ri www.assembleianaweb.com.br 47
- 48. Shareholders' Meeting via WEB Another step in good corporate governance practices; The system allows electronic proxy voting by digital certificate; More than half of Eternit’ shareholders reside outside the state of Sao Paulo; CVM (Securities and Exchange Commission of Brazil) and IBGC (Brazilian Corporate Governance Institute) recommend that companies encourage the participation of shareholders at meetings; The first 1,000 registered shareholders will have free digital certificates for the first year; Partners: 48
- 49. BLOG www.blogdaeternit.com.br Join and participate 49
- 50. BLOG Communication channel for all who wants to know about Eternit; It aims to enable interaction between the company and its public in a transparent manner; Another communication channel with stakeholders; The blog is divided into four sections: Chrysotile Asbestos Civil Construction Capital Markets Environmental Responsibility 50
- 51. American Depositary Receipt - ADR On February 24 2010, the Board of Directors approved to initiate the accession process to the American Depositary Receipts Program - Level 1 ADRs. Sponsor: Eternit; Depositary Bank: The Bank of New York; Custodian Bank: Banco Bradesco; Ratio between Eternit’ shares and ADR: One ADR for one common share. 51
- 52. Subsequent Event 52 52
- 53. Tégula Acquisition • Largest Brazilian company in the concrete roofing business • Portfolio with more than 33 product lines • Resale of solar heating equipment • Sales are made through dealers and representatives • Nationwide services • Market share exceeding 30% in the Brazilian concrete roofing business in 2009 • Number of Employees: 428 in 2009 • Installed Capacity: 71.8 million tiles • Capacity Utilization in 2009: 61% • Value of acquisition: approximately R$ 40 million 53
- 54. Plants Location 54
- 55. Main Products 55
- 56. Full Roofing Solution 56
- 57. Information Investor Relations Élio A. Martins Gilberto Cominato elio.martins@eternit.com.br gilberto.cominato@eternit.com.br Rodrigo Lopes da Luz rodrigo.luz@eternit.com.br Phone: (55-11) 3813-6034 www.eternit.com.br/ri 57