Braskem presentation 4_q07_20091201_en

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Braskem presentation 4_q07_20091201_en

  1. 1. 4Q07 Results Conference CallJosé Carlos Grubisich Carlos Fadigas 1
  2. 2. Forward-looking StatementsThis presentation contains forward-looking statements. Such statements are notstatements of historical facts, and reflect the beliefs and expectations of Braskem’smanagement. The words “anticipates”, “wishes”, “expects”, “estimates”, “intends”,“forecasts”, “plans”, “predicts”, “projects”, “targets” and similar words are intendedto identify these statements. Although Braskem believes that expectations andassumptions reflected in the forward-looking statements are reasonable based oninformation currently available to Braskem’s management, Braskem cannot guaranteefuture results or events.Forward-looking statements included in this presentation speak only as of the datethey are made (December 31, 2007), and the Company does not undertake anyobligation to update them in light of new information or future developments.Braskem shall not be responsible for any transaction or investment decisions that aretaken based on information included in this presentation. 2
  3. 3. Braskem: 2007 Highlights • Consolidation of the Brazilian Petrochemical Industry – Acquisition of petrochemical assets of Ipiranga Group and Copesul – Delisting of Copesul and cancellation of its registration as publicly-held company – Investment Agreement with Petrobras • Operating and Financial Performance – 10% growth in the Brazilian resins market (PE, PP and PVC) – Record resins production and sales in 2007 – Gross revenue reaches R$ 24 billion (US$ 12,3 billion) – EBITDA of R$ 3.2 billion (US$ 1.6 billion) – Net Income before minority interest is nearly R$ 1 billion – Net income after minority interest reaches R$ 568 million • Dividend Payment of R$ 278.5 million 3
  4. 4. Braskem: 2007 Highlights • Braskem rating upgraded in global scale – S&P raises rating and Fitch upgrades outlook for Braskem. Moody’s initiates rating – Braskem is 1 notch from Investment Grade • Petroquímica Paulínia operations startup in March 2008 • Growth projects move forward – Venezuela (450 Kton of polypropylene and 1,100 Kton of polyethylene) • Joint Ventures created • Approval of initial investment of US$ 90 million throughout 2008-2009 period • Innovation & Technology – In 2007, certification of the first Green Polyethylene in the world – from sugarcane ethanol – Annual capacity of 200 kton – Conversion of MTBE units into ETBE units from ethanol 4
  5. 5. Braskem:Record resins production and high capacity utilization rates Utilization Rates % Ethylene 99% pp PE PVC 95% 96% 94% 94% 92% 94% 93% 93% 88% 89% 86% 4Q06 3Q07 4Q07 4Q06 3Q07 4Q07 4Q06 3Q07 4Q07 4Q06 3Q07 4Q07 Resins Production Kton 2,824 2,740 702  Record annual 691 +3.1% production in 2007 +1.6% => 2,824 Kton 2006 2007 4Q06 4Q07Source: Braskem 5
  6. 6. BraskemRecord resins sales and strengthening of market leadership Domestic Sales 4Q06 x 4Q07 % Resins Market Share 4Q07 +40% + 33% +32% Others + 23 % +24% 30% 52% 18% Imports PE PP Braskem Brazilian PVC Resins Market * 2,089 1,932 +8% Braskem Resins Export Kton 2006 2007*Domestic Sales + ImportsSource: Braskem / Abiquim 6
  7. 7. Braskem:Improvement in key indicators Gross Revenue R$ million Net Revenue R$ million Exports US$ million 23.870 18,825 2,311 21,550 16,969 2,065 +11% +11% +12% 2006 2007 2006 2007 2006 2007 EBITDA R$ million Income before Minor. Interests R$ million Income after Minor. Interests R$ milhões 3,177 957 3,023 568 564 +5% +70% 117 +385% 2006 2007 2006 2007 2006 2007Source: Braskem 7
  8. 8. Braskem: EBITDA EvolutionCommercial strategy minimizes impact of both Naphtha price increasesand Exchange Rate R$ million Foreign Exchange 198 impact on costs Foreign 412 Exchange (317) impact on revenue 755 (335) 648 (119) (34) (28) (3) 3Q07 Feedstocks Fixed 4Q07 Prices Exchange Volume Others costs/ Rate SG&ASource: Braskem 8
  9. 9. Braskem: Financial PerformanceIncome before minority interest was approximately R$ 1 billion R$ million 4Q07 4Q06 Chg % 2007 2006 Chg % Main Financial Indicators (A) (B) (A)/(B) (C) (D) (C)/(D) Net Revenue 4,809 4,223 14% 18,825 16,969 11% EBITDA 648 938 -31% 3,177 3,023 5% EBITDA Margin 13.5% 22.2% -8.7 pp 16.9% 17.8% -0.9 pp Net Financial Result (54) (260) -79% (284) (1,013) -72% Net Income before Minority Interest 25 208 -88% 957 564 70% Net Income 27 79 -66% 568 117 385%Source: Braskem 9
  10. 10. Braskem: Debt maturity extension is a priority R$ Million (12/31/07) US$ 71% US$ - Non Trade Gross Debt: 8,382 Finance 36% Net Debt: 6,123 US$ - Trade Finance Average Maturity: 11 years 35% TJLP 8% CDI Pré 15% 6% Cash & Cash Equivalents 31% 2,259 892 1,282 14% 11% 10% 1,702* 8% 9% 7% 6% 4% 1,180 977 895 679 805 752 497 360 620 12/31/07 2008 2009 2010 2011 2012 / 2014 / 2016 / 2018 / Perpetual Invested in R$ 2013 2015 2017 2019 Invested in US$ •Includes R$ 1.7 billion from the bridge loan for the acquisition of Grupo Ipiranga petrochemical assetsSource: Braskem 10
  11. 11. Braskem: Leverage reduced by acquisition combined to improved rating Braskem Rating Net Debt / EBITDA LTM * (x) • Moody’s initiates rating with Ba1 - stable 2.72 • Standard & Poors raises rating 2.20 1.93 to BB+ - stable 1.44 • Fitch upgrades outlook to 34% positive Conclusion of Dec 06 Sep 07 Dec 07 Ipiranga Acquisition - Estimate Braskem is 1 notch from Investment GradeLTM – Last Twelve MonthsSource: Braskem / Rating Agencies 11
  12. 12. Braskem: Operating investments surpass R$ 1.3 billion R$ million 1,344 1,354* 351 Capacity Increases 238 Equipment Replacement 327 227 HSE 162 130 Technology 32 62 197 120 Productivity 61 60 Information System Maintenance 355 263 31 Others 82 2007 2008 * Does not include investment of US$ 90 million in VenezuelaSource: Braskem 12
  13. 13. New Share Buyback ProgramProgram size is US$ 150 million*• Proposed the cancellation of 16,594 thousand shares held in treasury, in the amount of R$ 244 million• Decided the new buyback program for preferred class A shares (PNA)• Bought back shares will be firstly held in treasury and posteriorly sold (sale or exchange) or cancelled• Program is expected to be concluded in 12 months• Investment to fully implement the program is estimated at R$ 252 million (US$ 150 million) (*) Braskem preferred share (BRKM5) price on 02/15/2008 13
  14. 14. Braskem: 2008 OutlookGlobal petrochemical player • Operating and Financial Performance – Domestic resins market growth ranging from 8% to 10% in 2008 – Resins market leadership – Reduction in fixed costs and expenses – impact of R$ 100 million from 2008 on – Strong commitment with profitability in domestic and external markets • Petroquímica Paulínia operations startup (PP) • Growth Projects – Venezuela • Progress in studies and presentation of PP project to Braskem and Pequiven Boards of Directors • Innovation and Technology – Approval of investments for the construction of Green PE Unit, with annual capacity of 200 Kton • Consolidation of the Brazilian Petrochemical Industry – Conclusion of Copesul and Ipiranga Group petrochemical assets acquisitions – Implementation of the Investment Agreement with Petrobras – Capture of Synergies amounting to US$ 1.1 billion in NPV Social and Environmental Responsibility 14
  15. 15. 4Q07 Results Conference CallJosé Carlos Grubisich Carlos Fadigas Visit our website: www.braskem.com.br/ri 15

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