Earnings Presentation  3Q11
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  • 1. Earnings Release 3Q11 November 10, 2011
  • 2. Quarter Highlights • Gross Revenue totaled R$ 109.8 million, a record amount, and exceeded 3Q10’s revenues by 6.0%ResultsResultado • Evolution of the growth indicators and profitability during the year: revenues, net profit and EBITDA, with a highlight being the 40.4% p.a. increase in gross profit at CSU Contact, with a net margin of 7.8% in 3Q11 • Number of cards processed reached 25.3 million, with an increase of 26.5% YoYOperations • A 21.3% p.a. rise in CSU Contact’s APs, ending the period with 4,207Negócios workstations • Launch of the Fans Engagement loyalty program and the Pre-paid Flex card • Creation of Board of Directors’ Advisory Committees, focused on Strategy and Development, Marketing and Markets, and Finance and RisksGovernanceGovernança • Consistent execution of the CARD3 share buy-back programs 2
  • 3. Strategy: profitable growth• Commercial focus • Only platform in the • Expansion of addressable • Focused on theaimed at diversification market that is tested markets middle marketof the client base and in operation • Fans Engagement • New issuers and • Improved financial current PL issuers • Search for new • Incorporation of the Web performance clients universe in the solutions• Innovation: products offered • Broader scope ofand technologies • International partnerships solutions • Pre-paid Flex card 3
  • 4. Clear and consistent resumption of expansionGross Revenue Business Units Gross Revenue Share(R$ million) (% of revenues - LTM) 109.0 109.8 103.6 100.5 CSU Contact CSU 97.8 48% CardSystem 52% 3Q10 4Q10 1Q11 2Q11 3Q11 Main Indicators Evolution • In the first nine months of (R$ million) 2011, gross revenues totaled R$ 102.0 101.1 319.3 million, up 1.4% over the 101.1 101.1 102.0 102.0 same period of 2010 96.0 93.5 93.5 93.5 91.0 27.3 27.3 • Company proves its 25.7 22.2 22.2 25.7 resiliency, with an increase in 15.1% 15.9% 16.3 16.3 13.2% 14.4% growth and profitability indicators 15.2% 15.9 15.9 14.4 14.4 during the course of the year: net 1Q11 1Q11 2Q11 2Q113Q10 4Q10 3Q11 3Q11 1Q11 2Q11 revenue, gross profit and EBITDA 3Q11 Gross Prof itit Gross Prof EBITDA EBITDA Net Income Net Revenue Net Income Operating Expenses * 2010’s numbers were adjusted to reflect the effects of full adoption of the accounting convergence effective for each quarter of 2010. 4
  • 5. Management of Costs and ExpensesTotal Costs SG&A Expenses(R$ million and % of net revenue) (R$ million and % of net revenue) 75.5 74.8 102.0 102.0 71.3 101.1 101.1 65.9 66.1 15.5 14.5 14.5 14.6 96.0 96.0 12.4 15.9% 93.5 93.5 91.0 91.0 15.9% 15.2% 15.1% 14.4% 76.3% 13.2% 74.6% 73.3%15.1% 72.7% 15.9% 14.4% 15.2% 15.1% 15.9% 14.4% 15.2% 13.2% 13.2% 68.7%3Q10 4Q10 1Q11 2Q11 3Q11 3Q10 4Q10 1Q11 2Q11 3Q11 * Net Revenue Operating Expenses Net Revenue Operating Expenses EBITDA x EBITDA Margin (R$ thousand and % of net revenue) 20,582 17,304 16,341 15,941 14,400 21.4% 19.0% 15.8% 16.0% 15.4% 3Q10 4Q10 1Q11 2Q11 3Q11 * 3Q11 SG&A disconsider the one time effect of R$ 0.7 million referring to employees dismissals within a cost reduction program. 5
  • 6. The evolution can be measured month after month• In 12 months, CSU presented strong organic growth, of 22% in revenues and 30% in EBITDA, comparing the months of September• The business unit CSU CardSystem improved revenues and gross profit by 12% p.a.;• CSU Contact, besides contributing to a significant revenue diversification for the Company, expanded its profitability, generating positive EBITDA in the month. Sep-11 Sep-10 ∆% CSU Net Revenues 33,716 27,646 22.0% Gross Profit 9,753 7,408 31.7% EBITDA 6,616 5,080 30.2% CSU CardSystem Net Revenues 17,000 15,114 12.5% Gross Profit 7,859 7,025 11.9% EBITDA 6,269 5,936 5.6% CSU Contact Net Revenues 16,716 12,531 33.4% Gross Profit 1,894 383 394.5% EBITDA 347 (856) n.a. 6
  • 7. PerformanceGross Revenue Gross Profit and Gross Margin(R$ thousand) (R$ thousand and % net revenue) QoQ: -0.4% YoY: -7.7% YoY: -14,6% QoQ: -5,4% 59,948 55,560 54,251 55,332 27,218 49,778 24,969 24,579 23,242 21,058 49.2% 49.6% 48.1% 45.7% 45.6% 3T10 4T10 1T11 2T11 3T11 3T10 4T10 1T11 2T11 3T11Billed and Registered Cards(in millions – end of period) • 26.8% increase in the number of YoY 26.8% 24.1 23.6 25.3 cards registered, with organic 22.6 20.0 20.6 22.0 growth and migration of Sicredi 17.3 17.1 17.0 cards (808,000) • Reduction of revenues and gross profit due to the alteration of the card mix, with a greater share from 3Q10 4Q10 1Q11 2Q11 3Q11 PL Billed cards Registered Cards 7
  • 8. PerformanceNumber of Workstations • 4,207 workstations, up 21.3%(units) 21.3% over 3Q10; 4,433 3,757 3,918 4,207 • Reduction in number of 3,468 workstations in RJ; low profitability operation not 556 compatible with the 400 426 442 295 Company’s objectives 3Q10 4Q10 1Q11 2Q11 3Q11 Training Total Workstations per Type of Service BPO Current positioning seeks to BPO 0.7% Infrastructure 13.8% • 12.6% Infrastructure win over premium segments Collection 9.3% 8.2% of the market, for Collection 8.4% example, with increasingTelemarketing 21.1% Customer Customer Care participation as a BPO Telemarketing Care 56.3% 16.2% 49.3% services provider Dec/10 Sep/11 8
  • 9. PerformanceGross Revenue Gross Profit and Gross Margin(R$ thousand) (R$ thousand and % Net revenue) QoQ: 1.9% YoY: 24.9% YoY: 40.4% QoQ: 270% 53,454 54,479 4,003 50,723 43,616 43,533 2,851 7.8% 7.0% 1,107 1,081 2.3% 2.2% 3Q10 4Q10 1Q11 2Q11 3Q11 3Q10 4Q10-0.3% 1Q11 2Q11 3Q11 (117) • Revenue growth prioritizes contracting of workstations with adequate pricing focused at profitability expansion • Gross margin of 7.8% in 3Q11 signals correct execution of strategy • Company continues to seek additional opportunities for productivity gains * 2010’s numbers were adjusted to reflect the effects of full adoption of the accounting convergence effective for each quarter of 2010. 9
  • 10. Investments • Capex during the quarter rose 20.1% in comparison with same quarter of 2010: • R$ 5.0 million for the CSU CardSystem business unit, used consistently to create new products and services and software development to receive new clients • R$ 2.7 million invested by CSU Contact, a decline of 67.2% compared to the previous quarter, due to concentration of new implementations in 2Q11Capex - R$ million 3Q11 3Q10 ∆% 2Q11 ∆%CSU CardSystem 5.0 4.3 16.7% 5.5 -9.8%CSU Contact 2.8 2.2 27.1% 8.4 -67.2%Capex 7.8 6.5 20.2% 13.9 -44.3% 10
  • 11. Innovation with synergy between the business divisions End-to-end solutions in the client’s life-cycleNew generation of loyalty programs:• accumulation & redemptions;• wide range of benefits & privileges;• discounts and exemptions for tickets;and FANS• differentiated credit cards program as ENGAGEMENTan integrating element. End-to-end solutions in the delivery of strategic and financial planning through execution of promotions, delivery of awards and measurement of the results 11
  • 12. Pioneerism overcomes cultural barriers Solution for cultural barriers of paying tariffs for the pre-paid cards Access to non-traditional segments : teaching institutions, drugstores, football clubsPre-paid card converts to a credit card and fan clubs.automatically :• credit analysis based on individualbehavior;• strong sales appeal, with lower CAC;• good profitability and scale for the issuer;• solution for private label or branded card PRE- CREDIT FLEX CARD CARD PAID 12
  • 13. Awards 2011National Tele-services PrizeCategory: RetailCase History: Operation Carrefour Customer ServiceABT Garrido Prize. Category: Third-Party Operations (Active)Case History: NET Telemarketing. Category: Third-Party Operations (Receptive)Case History: Operation TVAMarketing Best PrizeHistory: CSU AcquirerCSU GroupAbrasca Prize for Best Annual ReportFinalist 13
  • 14. Further Information Mônica Hojaij Carvalho Molina Carlos Montenegro Thatiana Zago Investor Relations Phone: (+55-11) 2106-3821 E-mail: ri@csu.com.br Site: www.csu.com.br/ir This material is the property of CSU CardSystem SA. Total or partial reproduction without the written approval of theCompany is prohibited. All rights reserved. The opinions expressed in this document may change at any time without notice.