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1 q08 results presentation 1 q08 results presentation Presentation Transcript

  • CSU CARDSYSTEM S.A. 1Q08 Conference Call April 25, 2008 investidorescsu@csu.com.br 1
  • Disclaimer This presentation may include forward-looking statements of future events or results according to the regulations of the Brazilian and international securities and exchange commissions. These statements are based on certain assumptions and analyses by the Company that reflect its experience, the economic environment, future market conditions and events expected by the company, many of which are beyond the control of the Company. Important factors that may lead to significant differences between actual results and the statements of expectations about future events or results include the company’s business strategy, Brazilian and international economic conditions, technology, financial strategy, client business development, financial market conditions, uncertainty regarding the results of its future operations, plans, objectives, expectations and intentions, among others. As a result of these factors, the actual results of the Company may significantly differ from those mentioned or implicit in the statement of expectations about future events or results. The information and opinions contained in this presentation should not be understood as a recommendation to potential investors and no investment decision should be based on the veracity, currency or completeness of this information or these opinions. No advisors to the company or parties related to them or their representatives shall have any responsibility for any losses that may result from the use or the contents of this presentation. 2
  • CardSystem’s Market Cards Performance End of March (million) 97 83 70 56 150 124 102 89 176 191 205 149 2005 2006 2007 2008 2005 2006 2007 2008 Debit Private Label Credit CardSystem Card Base Performance End of March (million) 17.6 13,0 10.37 8 .6 2005 2005 2006 2006 20072007 2008 2008 Source: CSU Source: Abecs, CSU 3
  • CardSystem – Operational Data Cards Performance Change (CSU x Market) End of March 35.4% 25.4% 19.8% 20.6% 19.3% 20.3% 17.8% 18.6% 2005 2006 2007 2008 CSU CardSystem Market Source: Abecs, CSU Private Label + Credit Market CardSystem CAGR 05 to 08 19.4% 27,7% CAGR 07 to 08 19.3% 35.4%  CardSystem achieved a record number of cards and closed the first quarter with a card base of 17.6 million.  CSU’s cards unit has consistently outperformed the market in terms of growth. CardSystem’s CAGR between the end of 1Q05 and 1Q08 was 27.7% against the market’s 19.4%. The difference was even bigger last year: 35.4% versus 19.3%. 4
  • CardSystem/MarketSystem Operational Data Cards Managed by CardSystem Accounts Managed by MarketSystem (million) (million) 15.62 16.6 17.6 2.04 13 14.25 1.97 1.9 1.84 1.77 1Q07 2Q07 3Q07 4Q07 1Q08 1Q07 2Q07 3Q07 4Q07 1Q08 Source: CSU Source: CSU  High-growth market;  Strategically important agreements signed at the end of 4Q07 and in 1Q08, with the effects already seen in the revenues of 2008 (Carrefour, Porto Seguro and OMNI);  Carrefour Visa project implemented in a record 45 days;  Agreements with huge potential at MarketSystem: Sicred and Porto Seguro. 5
  • TeleSystem/Credit&Risk  Continued focus on reducing operating costs and improving productivity has stabilized the results;  Cancellation of unprofitable contracts;  Focus on differentiated products and services with higher added value. Workstations in operation at TeleSystem and Credit&Risk (Quarterly Average) 634 758 785 780 748 3384 3283 3056 2553 2218 1Q07 2Q07 3Q07 4Q07 1Q08 WS's TeleSystem WS's CreditRisk 6
  • CSU (Consolidated) Gross Revenue (R$ ‘000) Cost of Services Rendered (R$ ‘000) 12.5% 2.4% 66.79 88.3 65.21 78,.4 1Q07 1Q08 1Q07 1Q08 Gross Profit (R$ ‘000) and Gross Margin (%)  CSU’s revenues in 1Q08 were R$ 88.3 million, which is 12.5% higher than the R$ 78.4 101.3% million in the same period last year. 15.3 .  Cost of services rendered increase only 2.4%, thus improving net income and gross margin significantly. 16,%  Gross profit rose 101.3%, from R$ 7.6 million in 9,7% 7. 6 1Q07 to R$ 15.3 million in 1Q08. 1Q07 1Q08 18,1% 7
  • CSU (Consolidated) General and Administrative Expenses EBITDA (R$ ‘000) and EBITDA Margin (%) Net Result (R$ million) (R$ million) 181.6% n.a. -19.0% 1.7 15.8 15. 0 12.7 18.3% -5.6 7.3% 5.3 1Q07 1Q08 1Q07 1Q08 1Q07 1Q08 14%  General and Administrative expenses fell by 19.0%, from R$ 15.8 million in 1Q07 to R$ 12.7 million in 1Q08.  EBITDA jumped 181.6%, from R$ 5.3 million in 1Q07 to R$ 15.0 million in 1Q08, thanks to the higher growth of revenue in comparison with costs and expenses.  Net Result improved significantly to R$ 1.7 million from a negative R$ 5.6 million. 8
  • CardSystem/Marketsystem Gross Revenue (R$ ‘000) Gross Profit (R$ million) and Gross Margin (%) EBITDA (R$ million) and EBITDA Margin (%) 77.0% 33.9% 80.7% 15.4 47.0 35.1 15.9 8.7 8.8 1Q07 1Q08 1Q07 1Q08 1Q07 1Q08  Growth of 33.9% in the Gross Revenue of CardSystem/MarketSystem between 1Q07 and 1Q08, thanks to the increase in the number of cards in the base and the accounts managed;  Gross Profit rose by 80.7% whereas EBITDA rose by 77%;  The higher growth in Gross Profit and EBITDA in comparison with revenues shows the improvement in operational efficiency and economies of scale. 9
  • TeleSystem and Credit&Risk Gross Revenue - TeleSystem e Credit&Risk Costs - TeleSystem e Credit&Risk (R$ million) (R$ million) -4.85% -5.78% 3,8% 43.3 41.5 41.2 39.1 1Q07 1Q08 1Q07 1Q08  Gross Revenue fell by 4.85% between 1Q07 and 1Q08, caused by the about 11% reduction in revenues at TeleSystem due to the restructuring carried out in the last half of 2007 and a 21% increase in revenue from credit and collections (Credit&Risk).  Cost of services at the units dropped from R$ 41.5 million in 1Q07 to R$ 39.1 million in 1Q08, also due to the restructuring carried out at TeleSystem in 2H07. 10
  • TeleSystem and Credit&Risk Gross Profit (R$ million) and Gross Margin (%) EBITDA (R$ million) and EBITDA Margin (%) -0.4 -0.6 -3.3 -1.2 87.9% 50.0% 1Q07 1Q08 1Q07 1Q08  Despite the lower revenue in comparison with 1Q07, we improved profitability, both in terms of Gross Profit of R$ (0.6) million against R$ (1.2) million, and EBITDA of R$ (0.4) million against R$ (3.3) million. Once again, this is a result of the restructuring carried out in the Call Center unit.  Margin will gradually improve. The workstations that were idle during the restructuring held at TeleSystem in the 2H07 will gradually be used to offer higher value-added products that may either be different from or complementary to those offered by our competitors. 11
  • Historical Data Gross Revenue (million) 87.4 86.2 88.4 78.4 90.9 1Q07 2Q07 3Q07 4Q07 1Q08 EBITDA CSU (R$ million) 15.0 11.9 11.3 5.3 5.6 1Q07 2Q07 3Q07 4Q07 1Q08 18.2% EBITDA Margin (R$ million) 14.0% 14.1% 7.3% 6.9% 1Q07 2Q07 3Q07 4Q07 1Q08 12 12
  • Results - Units Gross Revenue (R$ million) CarSystem / MarketSystem TeleSystem / CreditSystem 48.96 47.03 43.32 43.71 48.9 42.0 42.47 38.43 41.38 35.12 1Q07 2Q07 3Q07 4Q07 1Q08 EBITDA (R$ million) 15.42 13.70 13.61 10.38 8.67 (4.76) (0.42) (1.83) (2.29) (3.34) 1Q07 2Q07 3Q07 4Q07 1Q08 13
  • Debt and Investments Debt - R$ thousand 1Q08 1Q07 4Q07 Short Term Debt 55.8 31.8 57.9 Short Term 33.3 12.5 34.3 Leasing Short Term 22.5 19.3 23.6 Long Term Debt 58.6 48.0 53.5 Long Term 49.0 21.3 41.8 Leasing Long Term 9.7 26.6 11.7 Gross Debt 114.4 79.8 111.5 (-) Cash 1.8 2.0 2.4 Net Cash (Debt) 112.6 77.8 109.1 CAPEX  Investments in the area of cards maintained  Suspension of investments in the Caixa project Capex - R$ million 1Q08 1Q07 Chg. % 4Q07 Chg. % Systems (SW and HW) 4.3 4.3 1.2% 5.5 -21.7% Caixa Project 0.7 5.4 -87.5% 1.5 -53.1% Other 0.6 0.3 87.9% 0.4 29.8% Capex 5.6 10.0 -44.4% 7.4 -24.9% 14
  • Main Strategies  Growth of around 30%, with the focus on the CardSystem and MarketSystem units;  Rigorous control of operational management and profitability at TeleSystem and Credit&Risk;  Increase the profitability and margins of CSU as a whole. 15