Institutional Presentation 1 h12
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Institutional Presentation 1 h12 Institutional Presentation 1 h12 Presentation Transcript

  • Institutional Presentation - CSU CardSystem S/A 1H12
  • CSU: leader in technology and BPO services in Brazil Card base: 20 million of processed accounts Independent electronic transactions’ processing platform 44% market share among independent processors Business model: Full service provider for issuers and 20 years of systems customization focused merchant acquirers of electronic on the Brazilian market particularities payments Market intelligence & data analytics to maximize customers’ profitability Contact center infrastructure, management and BPO services 4,000 workstations providing inbound (Customer Care & Help Desk) and outbound The best and most efficient site (Telemarketing & Collection) services (Alphaview) in Latin AmericaGross Revenues (LTM)(in % of total revenues) CSU Contact CSU 46% CardSystem 54% 2
  • Consistent track record of profitable growth Innovation and consolidation Business and client Sustainable of the business model diversification growth 4x EBITDA and 4x Net Revenue Relaunch of CSU Contact Center: new site Entry of Creation of the Best of the Century CSU Institute Launch of solution for Private Equity the acquirer s market marketing award professional investor Start of Launch of the Contact Center R$ 398 R$ 395CSU: first first Private operations CSU develops R$ 314independent Label cards electroniccard processor voucher IPOin Brazil First company to operate with 3 brands R$ 96 44% market 15 years with 15 million EBITDA share in cards under management Brazil Net Revenue (in R$ million) 3
  • Important clients in diverse market segments 4
  • • Brazils electronic payment industry has experienced significant growth in recent years (CAGR 16%+) • The penetration of cards in total Brazilian household spending grew from 8% in 1999 to 27% in 2011. It is expected to reach 40% by 2017. Number of Cards (in million of units) & Number of Transactions (in billion of units) Participation of cards in household consumption (% of total) CAGR 08- CAGR 08- 12E 12E 16% 10% 746 687 628 55% 9.55 52% 565 514 8.33 453 40% 388 7.13 31% 336 6.11 27% 277 5.32 222 4.43 183151 3.70 3.16 2.52 1.941.37 1.63 2011 2013 2017 2022 2025 ** Estimated * Source: ABECS 5
  • Electronic payment eco-system Payment Payment Brands Brands Request for Request for Authorization Authorization Authorization Authorization Issuers Acquirers Acquirers (Banks & Retailers) Capture ofPayment Card / Billing Electronic Payment Transactions Purchase Cardholders Merchants 6
  • CSU offers a full range of services to card issuers • Financial Information • Interchange • Electronic Transaction Processing • Authorization • Information System Brands Brands • Contact Center • Accounting • Processing • Fraud Prevention • Operational Control Issuers Acquirers Acquirers(CSU s clients) CSU plays a central role in Brazil’s electronic transaction industry • Billing • InvoicingCardholders Merchants • Conflict Resolution • Customer Support 7
  • CSU offers a complete solution for acquirers and merchants • Operation management • Information system Brands Brands • Authorization • Billing • Network • Accounting • Processing • Back Office Issuers Acquirers(Banks & Retailers) Acquirers (CSU s clients) • Capture Network (POS terminals) • Contact Center • Conflict CSU plays a central role Resolution in Brazil’s electronic • Billing transaction industry Cardholders Merchants 8
  • CSU operates in the promising marketing services arenaCSU MarketSystem is a leading customer engagement & monetization solutions provider in Brazil:● More than 25 loyalty programs managed in 10 years● 6 million loyal clients● 11 billion loyalty points ACQUISITION processed annually● 200 thousand rewards/gifts delivered every year RETENTION DATA SALES INTELLIGENCE RELATIONSHIP ACTIVATION 9
  • Brazilian demand per type of client (in R$ million) • Brazilian market estimated at R$ 10,8 billion in 2012 Financial and an expected growth of 10% in the next year; Institutions 6,430 Convergence 3,980 • Growth in demand for customer service; Retail 424 Manufacturing 355 • Recognition of those providers best able to meet Services 239 contracted SLAs; Insurance 208 Utilities 165 • Continuous growth in collection, telemarketing and Government 117 on-site customer services. Healthcare 34 0 2000 4000 6000 8000Brazilian demand per type of service Market Share(in % of sales) (in % of sales) Collection Customer Others 22.6% 38% Care CSU 2.1% Contax 30.1% 40% Almaviva 2.5% Algar 4.5% Tivit 13.2% Atento 24.8% Other players Telemarketing 7% 15% 10
  • Growth strategy is supported by a differentiated platform TECHNOLOGY INDEPENDENCE• Flexible, secure and robust PERFORMANCE infrastructure (mainframe) • Independent shareholding• World-class systems and structure with no commercial applications, extensively • Accelerated time to market activity competing with customized for the Brazilian to new clients prospects and clients market • Dedicated commercial teams to • Lower operating costs• Highly qualified team of leveraged by scale gains each business lines professionals • First vendor to receive • Excellent infrastructure and• Innovation and new superior operations facilities MasterCard and Visa products, among a complete certification to provide services range of solutions for merchant acquirers • Opportunity for various partnerships and M&A 11
  • Strategy focusing sustainable profitability Keep expanding Continue investing in in the card issuers technology and software segment: development: organic + inorganic competitive advantage Market Improve and expand intelligence, data contact center/BPO andanalytics & CRM increase profitability: solutions: self sustainablevalue added service Consolidate entry as a vendor into the merchant acquiring segment: greenfield growth 12
  • Continuous investments and healthy capital structureInvestments(in R$ million) • Ca. 6/7% of net revenues are 42.3 40.6 invested in technology. 16.7 28.6 18.7 8.7 10.8 23.9 23.6 19.9 2.6 8.2 2009 2010 2011 1H12 CSU CardSystem CSU ContactNet Debt and Net Debt/EBITDA • Significant reduction in indebtedness(in R$ million and ratio) over the last 3 years; 109.1 95.0 • Debt profile is appropriate for future expected cash flow, while 59.5 3.2x 55.5 42.6 enough to take advantage of new 36.1 21.6 1.5x 1.5x 23.8 investment opportunities in its 0.7x 0.4x 0.3x 0.7x 0.6x market segment. 2005 2006 2007 2008 2009 2010 2011 2012** ** rolling 12 month EBITDA 13
  • Strong cash generation allow for dividend payments • Total of R$ 2.1 million invested in CARD3 stockNet operating cash buybacks during 1H12 generation on • Interest on equity amounting to R$ 7.5 million paid in 1H12: January 12 R$ 26.4 million • Cash balance ended the 1H12 totaling R$ 24.8 million 14
  • Consistent recovery in profitabilityNet Revenues(in R$ million) 395 383 398 364 318 319 • Recent commercial achievements will present major contribution to revenues as of 2013 196 2006 2007 2008 2009 2010 2011 1H12 • Attractive gross profit • Strong cash generation as measured by EBITDAProfitability Evolution • Second year of record net income generation:(in R$ million) 114.6 106.0 103.3 • Dividend distribution 73.7 • Share buy back program 78.9 78.1 46.3 64.4 65.4 52.1 • Consistent investments 45.5 33.1 22.6 40.5 • Reduction in indebtedness 33.9 17.0 39.3 6.7 13.6 -11.1 -6.3 2006 2007 2008 2009 2010 2011 1H12 Gross Profit EBITDA Net Profit 15
  • CARD3 is traded at inexpensive levels as compared to the market Net revenue Gross Margin EBITDA Margin Net Margin Company name (US$ million- EV/EBITDA P/E (%) (%) (%) 12M) 10,733.4 69.9 22.2 -4.2 - - 2,203.8 64.4 18.4 8.5 7.6 17.9 1,855.8 - 27.9 13.0 8.3 18.7 Financial Services Average 4,931.0 67.2 22.8 5.8 8.0 18.3 1,690.7 13.5 9.0 0.1 7.0 N/A Contact Center Average 1,690.7 13.5 9.0 0.1 7.0 N/A 197.3 27.0 18.1 6.5 2.9 6.91. Current data: Last 12 months - Last balance sheet and income statement - reference date Aug. 13, 20122. Methodology for calculating EBITDA standardized by Economática 16
  • -> strong and consistent operating performanceAverage Cardbase(in million of units) • Track record of cardbase growth, despite punctual clients leave; 24.3 23.8 22.9 20.1 20.9 20.6 20.5 • Constant investment in technology and scale lead 19.2 16.4 17.0 to healthy margins; • Operational leverage gains of scale are shared with clients to increase loyalty and discourage competition. 2008 2009 2010 2011 1H12 Registered Cards Billed cardsGross Revenue Gross Profit and Gross Margin(R$ million) (in R$ million and % of net revenues) 253.7 240.8 103.3 213.9 221.3 94.3 94.4156.7 159.2 71.2 116.1 54.4 50.9 44.5 46.3% 46.2% 42.0% 40.4% 37.7% 34.4% 36.0% 2006 2007 2008 2009 2010 2011 1H12 2006 2007 2008 2009 2010 2011 1H12 17
  • -> positioned for profitable growthNumber of Workstations • Important structural changes concluded in 2011 to(in units) strengthen market repositioning; 4,796 4,283 4,225 4,090 4,016 • Effective creation of a business unit; 3,757 3,494 • Dedicated sales team: new offerings and expanded prospects base; • Specialized HR professionals: labor intensive activity. 2006 2007 2008 2009 2010 2011 1H12 Gross Profit and Gross MarginGross Revenue (in R$ million and % of net revenues)(in R$ million) 11.6 11.3 197.6 206.3 8.9 7.6 174.3 177.2 172.7 171.9 2.4 7.2% 8.5% 0.9 7.0% 96.2 4.6% 1.5% 0.5% -3.2% -5.4 2006 2007 2008 2009 2010 2011 1H12 2006 2007 2008 2009 2010 2011 1H12 18
  • Consolidated Financial Information(in R$ million and % of net revenues) 2006 2007 2008 2009 2010 2011 1H11 1H12Net Revenue 318.8 318.6 363.7 394.8 383.3 397.6 194.6 195.8Gross Profit 46.3 45.5 73.7 106 114.6 103.3 47.8 52.2Gross Margin 14.5% 14.3% 20.3% 26.8% 29.9% 26.0% 24.6% 26.7% 45.4 50.9 71.2 94.3 103.3 94.4 45.6 44.6 Gross Margin 34.1% 34.4% 36.0% 40.4% 46.3% 46.2% 47.0% 42.0% 0.9 -5.4 2.4 11.6 11.3 8.9 2.2 7.6 Gross Margin 0.5% -3.2% 1.5% 7.2% 7.0% 4.6% 2.2% 8.5%EBITDA 39.6 33.9 64.4 78.9 78.1 65.5 30.3 40.5Net Profit -16.5 -6.3 9.5 17.9 33.1 22.6 10.3 13.6Net Debt 59.5 109.1 95.0 55.5 23.8 42.6 52.9 36.1Capex 28.9 46.9 25.4 40.6 28.5 42.3 24.1 10.8 19
  • High level of Corporate Governance100% common shares and 40% free floatNovo Mercado (100% tag-along rights; no poison pills)Majority of independent board membersFiscal Council3 members, with 1 appointed by minority shareholdersSolid investor relations cultureInvestment by private equity funds since 1997Well structured internal controlsStock based compensation plan for executivesActive Sustainability Arm (CSU Institute) 20
  • CSU Executive Board Organizational Chart Marcos Ribeiro Leite CEO Mônica Juarez Soares João Carlos Molina Gilson Anacristina Wanderval Ricardo Mary Mizuno + Danilo Engel Matias IR and Sanches Lugli Alencar Ribeiro New Business Malker Mendes General COO Corporate Key Accounts New Products Commercial Commercial Leite & Marketing Manager CardSystemDevelopment Director & Innovation Director Directors CFO Director Director MarketSystem MarketSystem Officer Card/Acquirer Card/Acquirer CSU Contact & Acquirer 21
  • Additional Information Mônica Hojaij Carvalho Molina Investor Relations Tel: +55 (11) 2106-3821 E-mail: ri@csu.com.br Web Site: www.csu.com.br/riThis material is the property of CSU CardSystem S.A., and any partial or total reproduction without the Company’s writtenapproval is prohibited. All rights reserved. Opinions expressed in this document are subject to change without prior notice.