Presentation 3Q12

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  • 1. Conference Call 3Q12 Investor RelationsSão Paulo, November 9, 2012
  • 2. Forward-looking statementsThis presentation contains forward-looking statements. These statements are nothistorical facts and are based on management’s objectives and estimates. Thewords "anticipate", "believe", "expect", "estimate", "intend", "plan", "project", "aim"and similar words indicate forward-looking statements. Although we believe theyare based on reasonable assumptions, these statements are based on theinformation currently available to Braskem and are subject to a number of risksand uncertainties.The forward-looking statements in this presentation are up-to-date as ofSeptember 30, 2012 and Braskem does not assume any obligation to update themin light of new information or future developments.Braskem is not responsible for any transaction or investment decisions taken basedon the information in this presentation. 2
  • 3. 3Q12 Highlights  The crackers operated at an average capacity utilization rate of 92% in 3Q12, 4 p.p. higher than the average rate of 2Q12.  Brazilian resins market increased 18% over 2Q12, reaching 1.3 million tons.  Braskem’s sales followed the positive trend and grew by 19% and 11% over 2Q12 and 3Q11, respectively.  3Q12 EBITDA was R$930 million, 10% higher than 2Q12. Compared to recurring EBITDA, the increase was 26%.  The butadiene plant expansion, which was commissioned in June, has reached its production level as planned. The new PVC plant continues to ramp up its production as scheduled, and is already operating at around 80% capacity.  Ethylene XXI Project (Mexico): advance on civil construction, beginning of pre- marketing and EPC agreement with the consortium formed by Odebrecht, Technip and Ica Fluor.  Prepayment of part of the debts with BNDES in the amount of R$400 million.  Settlement of the only operation that imposed financial covenants on the Company, which effectively standardized the contractual conditions of its financing facilities. 3
  • 4. Braskem’s sales in 3Q12 driven by the seasonality in Brazilian demand Brazilian Market for Thermoplastic Resins (kton)  Origin of Imports (PE+PP+PVC) 3Q12 3Q11 1,336 Others Argentina 14% 16% 2Q12 1,141 18% 1% Europe 3Q12 1,349 17% North America 27% Asia 11% Colombia Braskem’s Sales – Domestic Market (kton) 15% 3Q11 857  Thermoplastic resin imports followed the domestic consumption growth, maintaining 2Q12 798 19% 11% their market share stable at 23%. 3Q12 951Source: Alice /Braskem estimates 4
  • 5. EBITDA Performance – 3Q12 vs. 2Q12 EBITDA increased 10% in the quarter mainly due to the higher sales volume of resins and basic petrochemicals R$ million (domestic and export market) and the continued USD appreciation FX impact on revenue 296 (223) FX impact on costs 262 73 930 845 ( 49) ( 93 ) 737 (108 ) EBITDA Refis + ∆ Sunoco Recurring 2Q12 Volume Contribution FX Fixed Costs + EBITDA 2Q12 Compensation EBITDA Margin SG&A + Others 3Q12 5
  • 6. EBITDA Performance – 9M12 vs. 9M11 Higher sales volume and the USD appreciation partially offset the contribution margin contraction explained by the R$ million lower spreads in the international market. FX impact on revenue 3,717 486 FX impact (2,921) on costs 3,024 796 344 2,559 (331 ) ( 1,760) EBITDA Volume Contribution FX Fixed Costs + Refis + Sunoco EBITDA 9M11 Margin SG&A Compensation 9M12 6
  • 7. Maintenance of average debt term and high liquidity level Amortization Schedule(1)Braskem’s high liquidity ensures (R$ million) Diversified Funding of Sourcesthat its cash and cash 09/30/2012equivalents cover the paymentof obligations maturing overnext 35 months. Brazilian and Foreign Gov. 35% Entities 20% * 1,218 Capital 653 Market 18% Banks 6,029 54% 5,057 26% 13% 3,839 10% 9% 3,186 6% 3,008 6% 4% 2,154 1,657 1,477 714 987 1,058 09/30/12 2012 2013 2014 2015 2016 2017/ 2019/ 2021 Cash 2018 2020 onwards Credit Risk – Global Scale (1) Does not include transaction costs Invested in US$ * US$600 million stand by Invested in R$ Agency Rating Outlook Date* Fitch BBB- Negative 10/26/2012 Net Debt / EBITDA (US$) S&P BBB- Stable 03/19/2012 US$ million 2Q12 3Q12  Moody’s Baa3 Stable 04/19/2012 Net Debt 6,508 6,492 -0.2% *Date of issue of the last analytical report on the company EBITDA (LTM) 1,837 1,727 -6% Net 3.55x 3.77xa +6% Debt/EBITDA a Ex-bridge loan of Mexico Project = 3.67x in 3Q12 7
  • 8. Capex Investments (R$ million) 1,712  Maintaining its commitment to capital discipline, 1,385 260 Braskem invested R$1,385 million in 9M12; 34 78 113  ~42% of total or R$575 million allocated to capacity 148 Mexico expansion projects; 145 HSE Equipment Replacement  For 2012, total investment is estimated at R$1,712 575 512 million; Capacity Increase - Brazil  ~40% allocated to various expansion projects in Maintenance Brazil and to the Ethylene XXI greenfield project in 343 Mexico. 262 Productivity 35 Others 45 242 305 9M12 2012e 8
  • 9. 2012/2013 Outlook Points of Concern  Macroeconomic environment remains volatile – Management of Europe’s sovereign debt crisis – U.S. recovery could be affected by Hurricane Sandy  In general, demand is seasonally weaker in the fourth quarter  Feedstock prices impacted by geopolitical Potential Positive Factors issues  Brazilian Government committed to  Startup of new crackers may continue to strengthening industry and stimulating pressure industry margins through mid-2013 growth - Expectation that new measures will be announced to improve the competitiveness of domestic players  Growth resumption in emerging markets, driven by fiscal and monetary policy of local governments  Recovery of developed economiesSource: IHS (CMAI), research reports 9
  • 10. Braskem’s priorities Strengthening its relationship with Clients and expanding its market share Increase Braskem’s competitiveness by capturing the identified synergies, reducing fixed costs, diversifying feedstock and increasing utilization rates Capturing additional cash generated by the new PVC plant and Butadiene expansion in order to add value to the existing streams Building a Brazilian industrial policy that boosts the competitiveness of the petrochemical and plastics chain Prioritization of the growth projects  Conclusion of the project finance for the Mexico project, whose startup is scheduled for 2015 Liquidity and financial solidity maintenance in the current scenario marked by global crisis and lower demand for petrochemicals 10
  • 11. Conference Call 3Q12 Investor RelationsSão Paulo, November 9, 2012