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6th annual latam ceo conference itau bba (inglês)
 

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    6th annual latam ceo conference itau bba (inglês) 6th annual latam ceo conference itau bba (inglês) Presentation Transcript

    • 6th Annual Latam CEO Conference ItauBBA May 2011
    • Forward-looking StatementsThis presentation contains forward-looking statements. These statements are nothistorical facts and are based on management’s objectives and estimates. The words"anticipate", "believe", "expect", "estimate", "intend", "plan", "project", "aim" and similarwords indicate forward-looking statements. Although we believe they are based onreasonable assumptions, these statements are based on the information currentlyavailable 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 aremade (March 31, 2011) and the Company does not assume any obligation to update themin light of new information or future developments.Braskem is not responsible for any transaction or investment decision taken based on theinformation in this presentation. 2
    • Braskem: Leader in PE, PP and PVC production in the Americas Dominant market share in South America, with 69% of Diversified portfolio of petrochemical products, the Brazilian market with focus on PE, PP and PVC Strong growth track record with attractive project Annual capacity of 6,460 kton pipeline in Brazil, Latin America and Sustainable 31 facilities in Brazil and USA chemicals (focus on renewable raw materials) Naphtha and gas based crackers (70/30) Listed in 3 stock exchanges: BM&FBovespa, NYSE and Petrobras as the main supplier in Brazil (~70% Latibex - 100% tag along of naphtha needs and 100% of gas needs) Investment grade rating by S&P and Moody’s Market Cap (05/12/2011) – US$ 11.2 billion EV – Net debt March 2011 – US$ 17.1 billion 3 PPFinancial Highlights 2010 LTM 2011R$ billion Consolidated Consolidated 1 PVCNet Revenue 27.8 28.6 + 2,9% 1 Chlorine-sodaEBITDA 4.1 4.1 - 1 naphtha cracker 4 PENet Debt/EBITDA 2.43x 2.37X - 2,5% 1 PP 1 PVC 1 gas cracker Potential Short term 1 Chlorine-soda 1 PP Upside 1 PE 1 naphtha Synergies: 1 naphtha cracker cracker - Additional EBITDA – R$ 495 million on a 1 ethanol cracker 2 PP 5 PE 3 PE recurring basis as of 2012, out of which R$ 2 PP 377 million in 2011 Expectation of cycle recovery as of 2012 Industrial Assets 3
    • Agenda Vision and Growth pipeline The Petrochemical Industry South America and Brazil: an unique global position Global competitiveness: gas x naphtha Recent financial performance Final considerations 4
    • Agenda Vision and Growth pipeline The Petrochemical Industry South America and Brazil: an unique global position Global competitiveness: gas x naphtha Recent financial performance Final considerations 5
    • Strategic Vision “BECOME THE GLOBAL SUSTAINABLE CHEMICAL LEADER, INNOVATING FOR BETTER SERVE THE PEOPLE”. 6
    • 3 Main growth/value drivers Brazil The country will need a new thermoplastic plant per year until 2020 Gas supply from pre-salt exploration can bring competitiveness to the new projects in Brazil Internacionalization Latin America and US as good alternatives for future competitive feedstock supply Partnerships with local players to develop local industry at competitive gas prices Sustainable Chemicals Initial focus in renewable raw materials with no changes for customers in terms of investments and applications Partnerships to enter other avenues in green products 7
    • Brazil – adding value to the Vinyls chain PVC Expansion Operational start-up : May 2012 Expansion of 200 kton/y in PVC capacity in Alagoas, using EDC (1st intermediate product in the PVC chain) currently exported Investments of US$470 million Expected NPV ~US$450 million Total of R$149 million invested in 2010 and 2011 in the project Expected disbursement of R$380 million in 2011 Long term financing from BNDES (up to R$525 million) and from BNB (R$ 200 million) at very competitive costs Support for Brazil’s infrastructure projects Brazil currently imports ~30% of its needs PVC Domestic Demand (kton) 1,119 982 950 857 31% 748 34% 26% 19% 17% Imports New Projects Domestic Sales Industrial Assets 2006 2007 2008 2009 2010Source: Braskem 8
    • Brazil – adding value to the cracker chain Polybutadiene SBR SSBR NBR TR Styrene Butadiene Rubber Solution SBR Acrylonitrile Butadiene Thermoplastic Rubber Butadiene Rubber Operational start-up : 2013 Capacity: 100 kton/y Location: Triunfo (Rio Grande do Sul) Investments of R$300 million Pre-sales contracts have been firmed, receiving ~US$127 million of payments in advance Raw material for the manufacture of rubber tires and synthetic rubbers Attractiveness worldwide Tighter market balance sustaining higher prices Light feedstock expansion limiting the availability of C4 supply New Projects In 2010, butadiene prices increased by 50% from 2009 Industrial Assets Continuous consumption growth Higher demand from emerging markets Recovery of the mature marketsSource: Braskem 9
    • Brazil – potential capacity expansion projects 2013 - 2015 2016 - 2018 ~ 130 kton/y through DBNs adding LDPE, HDPE and PE LLDPE in Bahia, Rio de Janeiro and São Paulo (southeast of Brazil) ~ 100kton/y through DBNs in COMPERJ – from 1.1 to 1.5 Rio Grande do Sul (south of million tons of ethylene Brazil) and São Paulo PP (southeast of Brazil) or 300 kton/y through a greenfield project Greenfield adding ~250 PVC kton/y in the northeast of Brazil 10
    • Sustainable Chemicals Development Green PP Green PE 2013 Partnerships for the 2010 – started development of competitive Innovation in bioplastic technologies up in 4Q10 market Successful track record for Production integrated withBraskem becomes implementing projects: green propylene Cooperation agreement witha global leader in term and costs Capture of 2.3t CO2/t PP Cenpes (Petrobras Research biopolymers Center) Capture of 2.5t CO2/t PE Partnership with Development of other cracks Customers streams to sustainable chemicals PE integrated project study 11
    • Access to competitive feedstock The Ethylene XXI Project (Mexico) Mexico: Ethylene XXI Project Operational start-up: January 2015 JV between Braskem (65%) and the Mexican group IDESA (35%) for the purchase of ethane from PEMEX Integrated project: 1 Mton/y of ethylene and 1 Mton/y of PE Fixed Investment: US$ 2.5 billion over 5 years (project finance – 70% debt/30% equity) Expected NPV over US$ 3 billion Strategic partnership with Ineos and Lyondell Basell for PE plants technologies Technip was selected as the technology supplier for the ethylene cracker Financial Advisor hired: Sumitomo Bank Structuring of the participation of ECAs and Proj. MLAs1 – already received over US$ 6 billion in EXXI in 2014 letters of interest 1 Export Credit Agency (ECA) and Multilateral Agency (MLA)Source: Braskem 12
    • Mexican Polyethylene Market Currently deficit above 1.1 Mton (2010) - ~70% of the market – being supplied by US players Estimated deficit in 2015 (project start-up): 1.7 Mton Annual Growing rate foreseen: 4.5 % (Period: 2010-2025) Polyethylene Mexican Market 4,0 3,5 3,0 1,6 1,7MMton/year 2,5 1,3 1,4 1,5 1,0 1,1 1,2 0,7 0,8 0,9 2,0 1,5 1,4 1,5 1,1 1,3 1,0 1,0 1,0 1,0 1,0 1,0 1,0 1,0 1,0 1,0 1,0 1,2 1,1 1,0 1,1 1,0 1,1 1,1 1,1 0,5 0,8 0,8 0,8 0,8 0,8 0,8 0,8 0,8 0,8 0,8 0,8 0,8 0,6 0,7 0,7 0,8 0,8 0,8 0,4 0,5 0,5 0,5 - 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 Supply Ethylene XXI Deficit 13
    • Mexican Converters Industry 3,500 plastics converters 84% small and micro companies More than 5 Mton of plastics conversion, with 1.8 Mton of Polyethylene Main application: Packaging (48% market) Sales to distributors: Braskem ≠ Pemex Converters Profile Big 4% Medium 12% Micros Small 60% 24% Total: 3,500 Converters 14
    • Unique pipeline of growth in the Americas Consolidated Project Pipeline Brownfield/Greenfield expansion projects in Brazil: PE and PP assets Comperj – integrated complex in Rio Ethylene XXI - Mexico de Janeiro (southeast Brazil) (+ 1,000 kton/y ethylene New Biopolymers Plants in Brazil – and + 1,000 kton/y PE) integrated project (1st and 2nd Green PE – already Butadiene (100 kton/y) generation) operational (+ 200 kton/y ethylene) Green PP Peru(~1,000 kton/y ethylene/PE) (+ 30 kton/y ethylene/ Venezuela – under revaluation PVC Expansion propylene) (+ 200 kton/y) 2010 - 2012 2013 - 2015 Projects under evaluation Resin Capacity CAGR for 2010-2015: +4.3% p.y. Diversification of raw materials and world-class assets Fiscal discipline Excellent track record of projects executionSource: Braskem 15
    • Innovation & TechnologyInnovation and Technology Center Strenghtening the value chain competitivinessStructured resource base to support customer needs: Over R$ 330 million in R&D assets PP More than 190 researchers Coffee Bags 8 pilot plants More than 400 patents filed worldwide Partnership with universities and R&D centers in Brazil and abroad 12% of Polymer Business Unit revenues results from new products launched in the past 3 years PE Rotomolded Manhole PE Innovation pipeline BIOPOLYMERS PP NPV: ~US$ 510 million PVC PVC Doors 16
    • Innovation & Technology PP - NEW PP WASHING MACHINES PP - LOW VOC AUTOMOTIVE GRADE Partners: Electrolux and Colormaq Partner: Lyondell-Basell Brazil Innovation: Steel and PET replacement in Innovation: High performance grade for washing machine body part (lower cost and automotive compounds. weight) Target Sales: 4 kton/year Target Sales: 6 kton/year PE - LARGE ROTOMOLDED WATER TANKS PE - GRAIN BAGS Partner: Fortlev Partner: Pacifil Innovation: Fiberglass tank replacement Innovation: Lower cost and faster installation Target Sales: 32 kton/year with flexible silos for grain storage Target Sales: 5 kton/year PVC - PVC WINDOWS PVC - PVC ROOF TILES (To be launched) PP Partners: Claris, Primeira Linha, Veka and Partners: Not disclosed now due to secrecy Weiku agreement Innovation: Increase PVC window profile Innovation: Asbestos and Clay roof tiles application in the market replacement Target Sales: 2 kton/year Target Sales: 120 kton/year 17
    • Agenda Vision and Growth pipeline The Petrochemical Industry South America and Brazil: an unique global position Global competitiveness: gas x naphtha Recent financial performance Final considerations 18
    • Outlook on the global petrochemical industry Ethylene: Operating rate 1Q11MM ton20 Overview 1Q11 91 92 89 90 88 8615 83 1 Naphtha prices following oil volatility 83 81 2 81 80 80 78 Unscheduled shutdowns and better market 7410 70 demand in the mature markets Chinese economy once again presented 5 60 growth above market estimates 0 50 Competitive gas prices bring advantage to Europe N. America Asia M. East World Braskem US players Capacity 1Q11 Operating rate 1Q11 (%) Operating rate 4Q10 (%) Outlook Ethylene: Supply and Demand BalanceMM ton Scheduled maintenance shutdowns in 200 90.7 91.3 Europe and Asia 88.7 86.3 83.5 83.9 Upward price trend of resins and basic 150 petrochemicals, following higher costs 100 Continuous instability in Middle East operations 50 Stronger global demand 0 2010 2011e 2012e 2013e 2014e 2015e Capacity Demand Operating Rate (%) 1 Impacted by the scheduled maintenance shutdown in Bahia’s cracker for 52 days.Source: CMAI, Parpinelli Tecnon 2 Impacted by the power blackout that occurred on February 4 in all states in Brazils Northeast 19
    • Demand growth shall overcome new capacity additions Ethylene Demand 6.8% 5.2% CAGR 10-15 Capacity 6.7% 4.5% 4.4% 4.3% (MM ton) 3.4% 4.4% 4.0% 3.2% 2.3% 2.6% Supply 2.1% Asia CAGR 10-15 Africa 6,521 6,090 2.8% Middle East 4,514 Europe 9,010 2,805 Americas 3,216 3,423 3,229 3,814 400 3,417 Closures 2,652 2,545 Postponed/Delayed 468 1,816 2,462 3,774 2,067 529 1,200 490 Supply Growth % 743 962 550 375 (1,282) (699) (150) Demand Growth % (1,227) 2010 2011 2012 2013 2014 2015 -19% Delayed Limited additional capacity until 2015 No new investments announced motivated by financial crisis Sanctions in Qatar restrict investments in petrochemicals No further availability of cheap gas for new projects Greenfield projects: 4-5 years to startupSource: CMAI, March/2011 20
    • Agenda Vision and Growth pipeline The Petrochemical Industry South America and Brazil: an unique global position Global competitiveness: gas x naphtha Recent financial performance Final considerations 21
    • Braskem: unique position in the global industry Braskem responsible for over 60% of the capacity share of thermoplastic resins* in South America – 69% market share in Brazil. W.Europe North America # 29 players South America: # 32 players Second player has around 10% of Braskem’s capacity N.Asia M.East ~# 150 players Capacity (000 Metric Tons) # 38 players S.Asia Braskem: 5,510 Petroken: 180 ~# 40 players Ecopetrol: 548 PETROQUIM: 120 Mexichem: 416 Petroquímica Cuyo: 130 South America PBB Polisur: 650 Polinter: 495 # 12 players Pequiven: 185 Propilven: 115 Petro Dow: 42 Solvay Indupa: 541Source: Analysts reports, CMAI capacity list * PE, PP and PVC 22
    • Brazil: strong potential growth Brazilian’s thermoplastic demand (PE, PP, PVC) X GDP Growth% 2010 Market Share Estimate: Resins Demand ~ 2.0x GDP Others 15.0% 5% 10.0% Imports 2x GDP 26% 7.5% 1.0% 69% 4.5% Braskem -0.6% 2009 2010 2011e 2012e 2013e 2014e 2015e Brazilian GDP (Growth %) Demand Growth (2x GDP) % Per-capita Consumption of PE, PP and PVC (kg/person) 65 58 Brazil: 46 23 25 31 21 22 18 19 18 20 17 2002 2003 2004 2005 2006 2007 2008 2009 2010 USA Europe Japan ChinaSource: Abiquim, Braskem, CMAI, Ipeadata and IBGE. 23
    • Domestic market performance Braskem’s Sales Profile – 1Q11 Origin of Imports in 1Q11 (PE, PP and PVC) OTHERS Others RETAIL 11% 11% 5% FOOD PACKAGING Europe AGRIBUSINESS 32% 12% 5% North America Asia 27% AUTOMOTIVE 7% 10% Mexico Colombia 13% 1% 9% 14% Argentina CONSTRUCTION 25% 9% 9% CONSUMER GOODS INDUSTRIAL HYGIENE AND CLEANING Americas account for 67% of imports Imports represented 27% of the domestic marketSource: Abiquim, Braskem 24
    • Agenda Vision and Growth pipeline The Petrochemical Industry South America and Brazil: an unique global position Global competitiveness: gas x naphtha Recent financial performance Final considerations 25
    • US ethane-based industry to remain more competitive than naphtha based producersSource: CMAI 26
    • Preference for light feed (ethane) and refineries lowutilization rates to shorten co-products supply worldwide Global Base Chemical and PlasticsU.S. Shale Gas Advantange does not benefit all... Weighted Average Earnings Before Interest & Taxes Segment Contribution – U.S. Dollars per Metric Ton• Relative cost advantage accrues to the integratedand gas basis contracted products• Lower Btu values mean that lower feedstock andeletricity prices are a potential but not a certainty –market forces prevail• Differentiated natural gas results in lowergeneration of C4s and aromatics in steam crackers –may change trade volumes Relative Advantage Due to Natural Gas A comparison of MODERATE ADVANTAGE Polyethylene HIGHLY ADVANTAGE some of the products Chlorine & Refinery NO ADVANTAGE Caustic Soda Products impacted by the Ethylene Oxide Vinyls BTX difference in natural Derivatives EDC / VCM gas values vs. Oil MEG, Amines, Propylene Styrenics (Methanol) prices Alpha OlefinsSource: CMAI 27
    • Potential benefits for Braskem in this scenario Co-products Revenue (US$) Increased polymers competitiveness: 2,605 • gas-based projects; and 1,628 1,655 1,499 1.181 1,070 • increasing price scenario for co-products 867 801 824 920 498 165 265 395 (reducing naphtha based costs) 408 497 459 391 505 284 2006 2007 2008 2009 2010 Propylene Butadiene BTX Raw Material Profile Braskem Braskem Post-Acquisitions Braskem 2015* Braskem 2018** 3% 3% 2% 8% 13% 24% 33% 17% 51% 58% 15% 67% 13% 92% Naphtha and Condensate Gas *Considering Mexico Project Refinery Propylene Ethanol **Considering Comperj ProjectSource: Braskem 28
    • Agenda Vision and Growth pipeline The Petrochemical Industry South America and Brazil: an unique global position Global competitiveness: gas x naphtha Recent financial performance Final considerations 29
    • Recent Financial Performance Net Revenue (million of US$) EBITDA (US$ million) +2,0% +5,0% +40,9% +36,3% 16,620 2,308 2,354 15,833 11,620 1,638 2009 2010 LTM 2011 2009 2010 LTM 2011 Exports 23% 26% 28%EBITDA (US$ million) Nominal Capacity (kton) Resins 2,308 2,354 Ethylene Green Ethylene 10,212 10,412 1,626 1,638 1,337 5,921 5,551 871 851 764 3,621 2,965 3,045 3,145 3,190 5814572002 2003 2004 2005 2006 2007 2008 2009 2010 LTM 2011 2002 2003 2004 2005 2006 2007 2008 2009 2010 30
    • EBITDA performance: 1Q11 vs. 1Q10 Brazilian real appreciation and the increase in raw R$ million material price were offset by higher prices of resins and basic petrochemicals. FX impact on costs 284 FX impact on revenue (401) 4 244 910 (117) 919 ( 78 ) ( 29 ) ( 15 ) EBITDA Contribution Others FX Power Volume Fixed Costs EBITDA 1Q10 Margin Blackout Cost SG&A 1Q11Source: Braskem 31
    • Leverage decrease and Braskem’s ratings raised toinvestment grade Amortization Schedule(1) (R$ million) 03/31/2011 570* 21% 501 15% 15% 11% 10% 10% 2,598 2,890 10% 1,847 Gross debt pegged to dollar: 64% 1,891 8% 2,389 1,381 1,314 1,202 1,300 Net debt pegged to dollar: 79% 1,054 Corporate Credit Rating Agency Rating Outlook Date 03/31/11 2011 2012 2013 2014 2015 2016/ 2018/ 2020 Cash 2017 2019 onwards Global Scale Invested in R$ (1) Does not include transaction costs Moodys Baa3 Stable 3/31/2011 Invested in US$ * Stand by of US$ 350 million S&P BBB- Stable 3/30/2011 Fitch BB+ Positive 1/11/2011 National Scale Call of US$200 million in perpetual bonds issued in 2006, with Moodys Aa2.br Stable 3/31/2011 S&P brAAA Stable 3/30/2011 coupon of 9% p.a.. Issue of US$750 million in bonds with maturity Fitch AA (bra) Positive 1/11/2011 in 2021 destined for short and medium term debt pre-payment, with less atractive costs.. 32
    • Synergies from Quattor acquisition totaling R$75 million in 1Q11 EBITDA 1Q11*: R$75 million EBITDA 2011*: R$377 million R$ million R$ million 61 82 19 377 24 75 234 32 Industrial Logistics Supply EBITDA Synergies Industrial Logistics Supply EBITDA Synergies Identification of new opportunities, efficient and rapid implementation of initiatives to capture synergies Integrated planning for industrial units Centralized maintenance plan assets strategy Optimization of freight and gains in distribution and storage Joint purchase of materials for industrial operations Fiscal gains and lower cost of debtSource: Braskem * Annual and Recurring 33
    • Agenda Vision and Growth pipeline The Petrochemical Industry South America and Brazil: an unique global position Global competitiveness: gas x naphtha Recent financial performance Final considerations 34
    • Outlook and PrioritiesPetrochemical market: Naphtha price impacted by the oil price volatility Global petrochemical scenario marked by recovery, but oversupply is still expected for 2011, improving from 2Q11. Mitigating factors: Operational instability, delays on the startup of new plants, scheduled shutdowns in Europe and Asia and trade sanctions imposed on Iran; Higher prices of resins and basic petrochemicals; Strong demand from emerging countries like China, India and Brazil.Braskem’s priorities: Strengthening of the Brazilian petrochemical and plastics production chain To follow the domestic resins’ market growth: 9-10% in 2011 and regain the market share Ensure capture of identified synergies Adding value through the acquired assets Quattor: continue improvement in its operational efficiency Braskem America: return above capital employed Maintaining liquidity and financial health Growth Project – PVC Alagoas expansion – Project Ethylene XXI in Mexico, which is based in competitive raw material – To define Comperj’s configuration with Petrobras – Expand the use of renewable feedstock Maintain the leadership in sustainable chemicals 35
    • 6th Annual Latam CEO Conference ItauBBA May 2011
    • Appendix
    • Ownership Structure Leveraging relationship with Petrobras - World leader in - Conglomerate; Minority E&P in deep Shareholders waters; - More than 30-years in the petrochemical - Present in the industry; industry as 50.1% / 38.2% 0.0% / 5.9% 2.8% / 20.1% 47.1% / 35.8% investor, supplier - Investment Grade by and client; Moody’s and Fitch. Voting Shares / Total Shares - Investment Grade by all 3 Rating Agencies. • Odebrecht as the controlling shareholder reinforces Braskem’s condition as a listed privately-owned company Governance • Sole vehicle for petrochemical investments of both shareholders, Braskem has the right: - to lead all petrochemical investments identified by Petrobras; - if not of its interest, has the right to commercialize such products.Source: Braskem 38
    • Leader in the Americas and a top 8 global player in resins capacity 1stCapacity in the Americas (kton/y) 6,460 510 5,307 ( 4,827 4,256 4th 1,230 627 2,915 3,595 3,082 1,731 510 2,340 2,311 4,077 1,090 1,210 1,915 4,200 PVC 3,035 822 875 950 2,525 2,340 2,311 PP 1,995 1,050 1,040 950 PE Braskem Exxon Dow Lyondell Braskem Formosa Shintech Chevron Quattor Sunoco post Mobil Basell Philips transactions 10,914World Capacity (kton/y) 9,311 8,668 8th 7,749 7,284 7,109 6,541 6,460 4,681 4,564 12th 4,303 4,079 3,595 Lyondell Exxon SINOPEC Dow Formosa SABIC Ineos Braskem Total IPIC Reliance PetroChina Braskem Basell Mobil post transactions operations 39
    • Global Ethylene and Resins supply/demand Global Ethylene Supply/Demand (Mton/y) 156 161 148 150 153 147 143 141 133 130 135 119 123 112 Supply Demand 2009 2010 2011e 2012e 2013e 2014e 2015e Global Resins Supply (Mton/y) Global Resins Demand (Mton/y) CAGR * 09-15 4.0% CAGR* 09-15 223 229 5.7% 214 219 197 207 191 200 181 52 52 53 173 182 50 51 163 45 46 PVC 154 41 43 43 144 39 73 34 37 65 67 70 71 PP 32 64 61 57 61 55 51 54 PE 45 48 90 93 95 98 99 103 83 88 92 82 67 71 75 79 2009 2010 2011e 2012e 2013e 2014e 2015e 2009 2010 2011e 2012e 2013e 2014e 2015eSource: CMAI, March 2011 * Compounded Annual Growth Rate 40
    • Resins demand by region 2010 Resins (PE, PP, PVC) Demand by region Africa 3% China Europe 27% 18% North America 17% Asia ex-China 23% South America 6% Middle East 6%The Brazilian demand for resins represents 3% of global demandSource: CMAI 2010 estimates 41
    • Capacity utilization rates were positively impacted by the improvement of Quattor’s assets Braskem consolidated operating rates % Quattor - Ethylene Ethylene Polyethylene Polypropylene PVC 89% 94% 94% 93% 83% 86% 87% 83% 85% 71% 78% 80% 63% 4Q09 1Q10 2Q10 3Q10 4Q10 2009 2010 2009 2010 2009 2010 2009 2010 Raw material supply regularization, in the Southeast and Rio de Janeiro complex, gradually increased the operating rates of Quattor’s assets: RJ unit presented a record rate of 93% in the last quarter of the year Continuous operational improvement of existing assets (record production rates in the south complex) Scheduled maintenance shutdown at Bahia’s cracker in the 4Q10 had a higher influence in the PVC production, partially impacting the average operating rate of PE and PPSource: Braskem *2009 data does not include Quattor expansion of 200 kton 42
    • Revenues breakdown – 2010 Net Revenue by Product (1) 2010 Others 19% Fuel 4% ETBE 2% Cumene 2% Resins 53% BTX 8% Butadiene 4% Propylene 4% Ethylene 4% 1 Does notinclude naphtha/ condensate/crude oil processing and distributor sales * Benzene, Toluene, Paraxylene and OrthoxyleneSource: Braskem 43
    • 2010 COGS breakdown COGS 2010 (1) Deprec / Amort, Freight, 3.9% 7.0% Others, 0.9% Services, 1.5% Naphtha , 53.1% Labor, 3.1% Other Variable Costs, 7.2% Natural Gas, 2.4% Electric Energy, 4.3% Gas as feedstock, 16.9% (1) Does not include naphtha / condensate / crude oil processing and Quantiq costsSource: Braskem 44
    • Exports Destination – 2010 Exports 2010 Others Asia 1% 6% Europe 15% N. America 44% S. America 28% C. America 6% The Export Market represents 26% of Company’s Net Revenue.Source: Braskem 45
    • EBITDA performance: 2010 vs. 2009 R$ million Contribution margin was positive impacted by the higher sales volume and the improvement in resin- naphtha spread. FX impacted by the appreciation in Brazilian real. FX impact on costs 2,089 FX impact 1,979 (3,140) on revenues ( 1,051 ) 4,055 523 ( 441) (135) 3,181 EBITDA Volume Contribution FX Fixed Costs Non recurring EBITDA 2009 Margin SG&A * effect 2009** 2010 46Source: Braskem *SG&A: R$244 million of non-recurring expenses in 2010 **2009 non-recurring effect amounts R$135 million
    • EBITDA performance: 1Q11 vs. 4Q10 R$ million Higher resins and basic petrochemical prices didn’t offset the increase in raw material cost and Brazilian FX impact real appreciation. Sales volume, seasonally lower, were on costs 62 negatively impacted by the unscheduled maintenance FX impact shutdown in the northeast plants. (87) on revenue 71 1,074 ( 81 ) 919 ( 78) ( 35 ) ( 25) ( 7) EBITDA Fixed Costs Contribution Power Volume FX Others EBITDA 4Q10 SG&A Margin Blackout Cost 1Q11Source: Braskem 47
    • Debt Profile Mar/11 Gross Debt by Category Gross Debt by Index Foreign Gov. Entities CDI 1% 9% TJLP Brazilian Gov. 19% BRL - PRE Entities 7% 26% Capital Market 38% USD-POS 9% Banks USD-PRE 35% 55% 48Source: Braskem
    • Outstanding Bonds & Outstanding Ratings Coupon Yield ** Outstanding Bonds Maturity (% p.a.) (% p.a.) US$84.3 MM * Jan/2014 11.750 2.8 US$65.3 MM * Jun/2015 9.375 3.4 US$130.7 MM * Jan/2017 8.000 4.6 US$500 MM Jun/2018 7.250 5.1 US$750 MM May/2020 7.000 5.5 US$450 MM Perpetual 7.375 6.8 US$750 MM Apr/2021 5.750 5.5 * Post Tender Offer expired in April, 20th ** As of May, 13th Corporate Credit Rating – Global Scale Agency Rating Outlook Reviewed in Fitch Ratings BB+ Positive 01/11/2011 S&P BBB- Stable 03/30/2011 Moody’s Baa3 Stable 03/31/2011 49Source: Braskem / Bloomberg
    • Covenants Net Debt/EBITDA (R$ million) (US$ million) -2% -2% 2.43x 2.37x 2.56x 2.52x Dec 10 Mar 11 Dec 10 Mar 11 Facility Amount* Mar 11 Currency Type Senior Notes R$ 500 MM R$ 500 MM R$ Issuance Nippon Export and US$80 MM US$33 MM US$ Maintenance Investment Insurance EPP (Export Pre-Payment) US$725 MM US$400 MM US$ Maintenance *The company is prevented from issuing any new debt for the period if it overcomes the 4.5x Net debt / EBITDA ratio. 50Source: Braskem