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4 q07 results presentation 4 q07 results presentation Presentation Transcript

  • 4Q07 Results Conference Call March 14, 2008 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 expected events by the company, many of which are beyond the control of the Company. Important factors that may lead to significant differences between the 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, financial market conditions, uncertainty regarding the results of its future operations, plans, objectives, expectations and intentions, among others. Considering these factors, the actual results of the company may be significantly different from those shown 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 is to be based on the veracity, current events or completeness of this information or these opinions. No advisors to the company or parties related to them or their representatives should have any responsibility for any losses that may result from the use or contents of this presentation. 2
  • Market for CardSystem/MarketSystem Cards Evolution At the end of December - Million 436 386 93 338 79 277 68 142 53 120 99 86 187 201 171 138 2004 2005 2006 2007 Debt Private Label Credit Market Growth ABECS x CSU 50,7% 37,2% 19,8% 20,1% 19,2% 18,1% 2005 2006 2007 * ABECS CSU 3 View slide
  • CardSystem/MarketSystem – Operational data CSU – Registered Cards in Base at the end of December (million) 16,6 12,1 10,1 6,8 6,8 CSU Market CAGR 2004 - 07 35.3% 19.1% 2003 2004 2005 2006 2007 Source: CSU  Consequent to the increase in the number of cards, CSU closed the year with 16.6 million registered cards.  In the past12 months, the market grew 18.1% while CSU grew 37.2%. 4 View slide
  • CardSystem/MarketSystem – Operational data CSU CardSystem – Entry of new cards CSU MarketSystem –Accounts managed (thousands) (million) 1.860 2,00 1,90 1.417 1.306 1.248 1,84 1.033 1,77 1,70 4Q06 1Q07 2Q07 3Q07 4Q07 4Q06 1Q07 2Q07 3Q07 4Q07 Source: CSU Source: CSU  We entered into a strategic agreement with Riachuelo;  We implemented the HSBC Cartão Combustível in December 2007, with strong market penetration;  Implementation timing record of Carrefour‟s Visa Card in 45 days;  High portfolio growth;  Implementation of Porto Seguro‟s card in November 2007;  Implementation of OMNI‟s card in December 2007; 5  High potential contracts at MarketSystem, Sicred and Porto Seguro.
  • TeleSystem/Credit&Risk TeleSystem and Credit&Risk  Financial turnaround achieved in the period due to the substantial reduction in operational costs and gains in productivity when compared to 4Q06;  Cancellation of unprofitable contracts;  The units maintain the strategy of portfolio diversification, with focus on smaller operations with greater stability;  reduction in the number of workstations in operation in December 2007; CSU Workstations in operation- thousand 3,872 3,322 3Q07 4Q07 6
  • Financial Performance Gross Profit CSU (R$ million) 92.8 90.9 87.4  Revenue growth of 5.8% between 86.2 4Q06 and 4Q07. 81.4 78.4 3Q06* 4Q06* 1Q07 2Q07 3Q07 4Q07 CSU EBTIDA (R$ million) 11.9 12.9 11.3  Significant EBTIDA growth of 121.5% compared to 4Q06 5.6 5.1 5.4 3Q06* 4Q06* 1Q07 2Q07 3Q07 4Q07  Due to the Company‟s effort to EBTIDA Margin (R$ million) reduce costs and expenses and the issue of new cards in 2007, we 13.9% 13.09% more than doubled the EBITDA 13.11% margin, from 6.3% in the 4Q06 to 13.1% in the 4Q07. 6.9% 6.4% 6.3% 3Q06* 4Q06* 1Q07 2Q07 3Q07 4Q07 7
  • Financial Performance 53.0 Gross Revenue of Units (R$ million) 49.0 48.9 45.7 Card/Market Tele/Credit 43.7 43.3 42.0 42.5 39.8 35.8 38.4 35.1 30,7% 3Q06 4Q06 1Q07 2Q07 3Q07 4Q07 * EBTIDA of Units (R$ million) 13.7 13.6 11.6 10.4 9.3 Card/Market 8.7 Tele/Credit 1.3 3Q07 3Q06 4Q06 1Q07 2Q07 4Q07 (1.8) (2.3) (3.3) (4.2) (4.8)  Positive change in the Company's revenue portfolio with CardSystem/MarketSystem responsible for over 50% of revenues in 4Q07. 8
  • CSU (Consolidated) Gross Revenue (R$ „000) Cost of Services Rendered (R$ „000) 5.8 % 1.3 % 86,179 66,427 67,298 81,442 4Q06 4Q07 4Q06 4Q07 Gross Profit (R$ „000) and Gross Margin (%) 44.6 %  Cost increase was lower 12,808 than Gross Revenue growth, compared to 8,858 4Q06. 11.8% 16% 18,1% 4Q06 4Q07 9
  • CSU (Consolidated) General and Administrative EBITDA (R$ million) and EBITDA Net Results (R$ „000) Margin (%) Expenses (R$ „000) 389 -9.5 % 16,180 121.5 % 14,648 11,315 14% 5,180 14% 18,1% 7% 14% 18,1% (7,068) 4Q06 4Q07 4Q06 4Q07 4Q06 4Q07  Reduction in general and administrative expenses in the 4Q07 compared to 4Q06.  Higher revenue growth versus costs and expenses compared to the 4Q06 doubled EBITDA margin in the 4Q07;  Net Result: “Turnaround” in net profitability and significant improvement compared to 4Q06; 10
  • CardSystem/MarketSystem Gross Revenue (R$ million) Gross Profit (R$ million) and EBITDA (R$ million) and EBITDA Margin (%) Gross Margin (%) 22.2% 34.3 % 46.8% 43.7 14.5 13.6 9.3 10.8 35.8 36% 28% 33% 33% 36% 4Q06 4Q07 4Q06 4Q07 4Q06 4Q07  Increase of 3 p.p. in Gross Profit of CardSystem/MarketSystem compared to the 4Q06;  EBITDA increase of 5 p.p. versus the 4Q06;  Improvement in operational efficiency. 11
  • TeleSystem and Credit&Risk Gross Revenue (R$ million) Gross Profit (R$ million) and EBITDA (R$ million) and EBITDA Gross Margin (%) Margin (%) - 7.0% n.a 45.7 n.a 42.5 3,8% 4Q06 4Q07 -5.8% -4.4% -9.8% -4.6 % (2.3) (1.7) (4.2) (1.9) 4Q06 4Q07 4Q06 4Q07  Gross Revenue declined by 7.0% compared to the 4Q06, due to the 20.0% reduction in Telemarketing revenue and 42.0% growth in credit and collections.  Despite revenue decline compared to the 4Q06, we had profitability gains both in Gross Profit (R$ 0.2 million) and EBITDA (R$1.9 million) and 4.0 p.p. 12
  • Debt and Investments Debt R$ million 4Q07 4Q06 3Q07 Short Term 57.9 44.3 48.9 Short Term Debt 34.3 24.2 24.0 Leasing Short Term 23.6 20.1 24.9 Long Term 53.5 52.4 59.1 Long Term Debt 41.8 21.4 42.2 Leasing Long Term 11.7 31.0 16.9 Gross Debt 111.5 96.7 108.1 (-) Cash 2.4 37.2 3.5 Net Cash (Debt) 109.1 59.5 104.6 CAPEX (in R$MM) 14.5 CAPEX 4Q06 3.8 4Q07 3Q07 4Q07 10.3 Sistemas (SW e HW) 4,7 5,5 10,3 5,5  Conclusion of investments in Projeto Caixa 7.4 5,3 1,5 3,8 7.4 1,5 development of Caixa‟s operating 5.3 Outros 1.5 0,3 0,4 0,4 1.5 0,4 platform; 10.3 5.5 5.5  Investments in cards. 4.7 4Q06 4Q07 3Q07 4Q07 Systems (SW and HW) Caixa Project Others 13
  • Final Remarks CSU – Registered Cards in Base CSU - CSU – Registered Cards in CardSystem Entrada de Cartões Novos Base at the end of December (million) 16.6 at the end of December (million) (Milhares) 1,860 12.1 9.8 1,417 1,248 6.8 6.8 1,033 447 2003 2004 2005 2006 2007 1Q07 2Q07 3Q07 4Q07 Jan. 08  Record emission of 446,725 new cards in January, raising CSU's total card base to 17.1 million;  Card base: 37% growth in comparison with 18% industry expansion;  Gross Revenue Card/Market: 21.9% increase. 14