Presentation 4Q12

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Presentation 4Q12

  1. 1. 4Q12 and 2012 Earnings Conference Call Investor Relations São Paulo, February 7, 2013
  2. 2. Forward-looking Statements This presentation contains forward-looking statements. These statements are not historical facts and are based on management’s objectives and estimates. The words "anticipate", "believe", "expect", "estimate", "intend", "plan", "project", "aim" and similar words indicate forward-looking statements. Although we believe they are based on reasonable assumptions, these statements are based on the information currently available to management and are subject to a number of risks and uncertainties. The forward-looking statements in this presentation are valid only on the date they are made (December, 31 2012) and the Company does not assume any obligation to update them in light of new information or future developments. Braskem is not responsible for any transaction or investment decision taken based on the information in this presentation. 2
  3. 3. 4Q12 Highlights Crackers utilization rates of 82% – Seasonality of the Brazilian market and operational problems Braskem’s thermoplastic resin sales of 867 kton, reflecting quarterly seasonality - market share of 70% Net revenue of R$9.2 billion, similar to 3Q12 and 8% higher than in 4Q11 Divestment of non-core assets – Cetrel and Distribuidora de Águas de Camaçari: R$652 million – Railcars in USA: R$170 million (US$83 million) EBITDA of R$1,399 million or US$677 million – Includes capital gain of R$516 million from asset divestments Integrated project in Mexico – Braskem’s interest in the project up to 75% – Conclusion of US$3.2 billion project-finance structure Commitment to financial health – New stand-by credit line: R$450 million – US$200 million from Nexi (disbursed in Jan-13) 3
  4. 4. 2012 Highlights Crackers utilization rates of 89%, up 6.6 p.p. on 2011 Thermoplastic resin sales of 3.5 million tons, reflecting 6 p.p. market share gain in 2012 to 71% EBITDA of R$4.0 billion or US$2.0 billion – Excluding nonrecurring items, EBITDA stood at R$3.1 billion Braskem made progress in its strategy of adding value to the existing streams and diversifying its feedstock profile – Startup of the new PVC plant and expansion of the Butadiene plant – USA: acquisition of a splitter and partnership strengthening with Enterprise Products – Integrated project in Mexico • Earthmoving works concluded and EPC contract signed • Pre-marketing activities launched • Conclusion of US$3.2 billion project-finance structure Divestment of non-core assets and commitment to financial health Confirmation of investment grade rating by 3 global credit risk agencies 4
  5. 5. Thermoplastic resin market shows signs of recovery. Braskemexpands presence in the domestic market  Brazil’s Thermoplastic Resin Market  Braskem’s domestic sales (kton) (kton) +3% +12% -8% -9% 1.3 1.0 1.2 1.2 0.9 0.8 4Q11 3Q12 4Q12 4Q11 3Q12 4Q12 +2% +10% 4.9 5.0 3.5 3.2 2011 2012 2011 2012Source: Alice / Braskem Estimates 5
  6. 6. EBITDA Performance – 4Q12 vs. 3Q12 The lower sales volume was partially offset by the recovery in spreads for R$ million the main basic petrochemicals and by exchange variation. EBITDA also benefitted from the divestment of core assets in 4Q12. FX impact on revenue 104 516 1,399 (77) FX impact on costs 112 27 930 898 ( 60 ) ( 127 ) EBITDA Volume Contribution FX Fixed Costs + Recurring 4Q12 Non- recurrent EBITDA 3Q12 Margin SG&A + Others EBITDA items 4Q12 6
  7. 7. EBITDA Performance – 2012 vs. 2011  The higher sales volume and U.S. dollar appreciation partially offset the contribution margin contraction, which was affected by the lower spreads R$ million of resins and basic petrochemicals, following the international market trend. Nonrecurring effects during 2012 also positively impacts on the result. FX impact on revenue 5,529 520 FX impact (4,478) on costs 860 3,958 3,742 1,051 3,098 ( 396) ( 1,819 ) EBITDA Volume Contribution FX Fixed Costs + Recurring Non- EBITDA 2011 Margin SG&A 2012 recurrent 2012*Nonrecurring: Refis + Compensation + Asset divestments EBITDA items* 7
  8. 8. Longer debt profile with diversified financing sources. Commitment to maintaining liquidity  Braskem’s high liquidity1 ensures that its cash and cash equivalents cover the payment of obligations maturing over the next 36 months Gross Debt by Category Diversified funding sources Amortization Schedule(1) (R$ million) Brazilian and 12/31/2012 Foreign Gov. Entities 20% 1,676 * 22% 23% Capital Market 15% 53% Banks5,170 27% 2,218 10% 10% 3,950 4,006 3,494 9% 6% 2,668 4% 1,842 1,765 1,521  USD-denominated gross debt: 68% 1,277 1,098 721  USD-denominated net debt : 69% 12/31/12 2013 2014 2015 2016 2017 2018/ 2020/ 2022 Cash 2019 2021 onwards (1) Does not include transaction costs Invested in US$ Invested in R$ * US$600 million stand by and R$450 million Net Debt / EBITDA (US$) Credit Risk – Global Scale US$ million 3Q12 4Q12  Agency Rating Outlook Date Net Debt 6,492 6,859 +6% Fitch BBB- Negative 10/26/2012 EBITDA (LTM) 1,722 2,003 +16% S&P BBB- Stable 11/9/2012 Net Debt/EBITDA 3.77x 3.42x* -9% Moody’s Baa3 Negative 11/28/2012 * Ex-bridge loan for Mexico Project = 3.30x in 4Q12 1 Includes US$600 million and R$450 million in stand-by credit facilities 8
  9. 9. Growth projects and Capex R$ million Investments (R$ million) 2,244 1,713 536 34 Capacity Increase 173 636 204 Mexico Comperj/ Acrylic Acid/ 173 Splitter Productivity/ HSE 1,332 Maintenance/ Equipment Replacement/ Others 869 2012 2013e Maintaining its commitment to capital discipline, Braskem made R$1,713 million in operating investments in 2012, in line with the previous estimative of R$ 1,712 million  ~40% of the total, or R$670 million, was allocated to capacity expansion For 2013, investment is estimated at R$2,244 million  ~70% allocated to maintenance, productivity improvement and the scheduled cracker shutdown  ~25% for construction of the new petrochemical complex in Mexico 9
  10. 10. Global scenario Points of Concern  High volatility of oil and naphtha prices  Lack of definition on a recovery of the European economy and its influence on the world economic growth  petrochemicals demand  Power outages (Brazil) Potential Positive Points  Positive indicators from the U.S. economy  Expectation that the measures adopted by the Chinese government will support gradual improvement in domestic demand  Brazilian government committed to developing the chain and strengthening the competitiveness of local manufacturers - Extension of Reintegra program - Brasil Maior Plan (REIQ) - Combatting importsSource: CMAI , Analysts’ Reports 10
  11. 11. Braskem’s priorities in 2013 Focus on continually strengthening the relationship with Clients and expanding market share Support for creation of an industrial policy that increases competitiveness in the petrochemical and plastics chain in Brazil, while attracting new investment to the sector Boosting Braskem’s competitiveness by capturing the identified synergies, reducing fixed costs and increasing utilization rates Ensuring disbursement of the project finance and making progress on construction of the greenfield project in Mexico; start-up is expected in 2015 Concluding the basic engineering studies for the industrial units of the Comperj (FEL3) project and defining the feedstock to be used by the complex Consolidating Braskem’s leadership in renewable chemicals Maintaining liquidity and financial health in a scenario marked by global crisis 11
  12. 12. 4Q12 and 2012 Earnings Conference Call Investor Relations São Paulo, February 7, 2013

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