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    Tereos apresentacao 1_q14_eng Tereos apresentacao 1_q14_eng Presentation Transcript

    • Tereos Internacional First Quarter 2013/14 Results São Paulo – August 15th, 2013
    • Major Reporting Changes 2 Beginning on April 1st, 2013, Tereos Internacional’s financial statements and results presentation will be adjusted for the following practices and, for comparability purposes, prior year results will be presented on a pro-forma basis, applying the new practices retrospectively. Accounting  Adoption of IFRS 11 (Joint Arrangements): all joint ventures are no longer consolidated proportionally in Tereos Internacional’s balance sheet, income statement and cash flow statement. JVs are now consolidated under the equity method and the impact on the income statement will be limited to the share of profit in associates line. Operational  Intersegment elimination: Segmental information, in the appendix to the accounts, is now presented on a stand-alone basis (ie. including intra-group sales) as well as on a contributive basis (ie. only external sales). Revenues presented in this document and in the external communication remain on a contributive basis.  Change of segmental classification due to Lillebonne’s diversification: given the beginning of the dextrose line at Lillebonne and considering that this plant’s profile is moving towards the production of food-related applications, all operational (e.g. volumes grinded) and financial figures (excluding alcohol & ethanol sales volumes) are now accounted for under the Starch & Sweeteners segment. Therefore, cereals grinded (and related co-products) in the Alcohol & Ethanol division are only made up of the DVO plant volumes.
    • R$ Million Q1 13/14 Q1 12/13 Equity Method Proportional Consolidation Equity Method Proportional Consolidation Revenue 1,908 1,960 1,622 1,678 Adjusted EBITDA 210 224 134 156 Adj. EBITDA Margin 11.0% 11.4% 8.3% 9.3% EBIT 47 55 (19) (13) EBIT Margin 2.5% 2.8% -1.2% -0.8% Net Debt 4,050 4,219 3,335 3,428 Net Debt including Related Parties 4,101 4,306 3,592 3,702 List of JVs Sedalcol France, Sedalcol UK, Sedalcol EU, Sedamyl, Sedamyl Services, Uniglad, Magnolia, Dongguang and Vertente 3 Equity Accounting vs. Proportional Consolidation Method (Reported vs. Pro-forma)
    • Q1 2013/14 Highlights 4  Operational  Guarani: Progress in co-generation (Cruz Alta/São José) and capacity expansion (Vertente/Mandu). 2013/14 planting program with c. 30,000 hectares already achieved  Syral Europe:  Lillebonne volumes progressively increasing (capacity utilization: over 80% in Q1 13/14 and over 90% in July)  Progressive dextrose production ramp-up at Lillebonne  Syral Brazil:  Satisfactory start of commercial production at Palmital corn-based starch facility  Strategic  Syral China: Most government approvals of Tieling acquisition obtained  Finance  Dividends: R$37.8 million distributed on June 25th, R$0.0462 per share and a dividend yield of 1.4% (as of March 31, 2013)  Governance  Fiscal Board: Reelection of the current members of fiscal board was approved at AGM  Guarani’s new CEO: Alberto Pedrosa was appointed as Guarani’s CEO replacing Jacyr Costa, who was previously appointed member of Guarani’s Board of Directors, and member of the Executive Committee of Tereos, representing the group’s sugarcane division
    • Sugar:  Sugar prices remained under pressure as a consequence of a fourth consecutive world surplus (5.1 million tonnes, LMC) and a promising crop in Center-South of Brazil (590 million tonnes, as per UNICA’s last estimates)  Raw sugar prices declined (-6.7%) in the quarter, from 17.7 to 16.4 USD cents/lb. Nevertheless, as of July prices started to rebound Starch:  Markets remain bearish for cereal prices due to high productivity prospects in USA and the start of the harvest period in Europe  Starch volumes are trending up even though prices are under pressure (especially industrial starches) with new capacity coming on stream in Europe Ethanol:  In Brazil, prices remained stable Y-o-Y, despite an increase in production, due to competitive parity (vs. gasoline) in the quarter.  April/2013 to July/2013 ethanol sales volumes in the Center- South of Brazil improved 28% Y-o-Y to 8.5 billion m3 due to higher anhydrous blend (25% as of May 1st).  Rotterdam prices improved substantially Y-o-Y (+7.9%) but remained largely stable sequentially5 Source: Bloomberg Market Highlights 300 400 500 600 700 800 Mar-12 Jun-12 Sep-12 Dec-12 Mar-13 Jun-13 NY#11 LIFFE #5 US$/MT 170 190 210 230 250 270 Mar-12 Jun-12 Sep-12 Dec-12 Mar-13 Jun-13 Corn Matif Wheat Matif €/MT 400 500 600 700 800 700 1000 1300 1600 1900 Mar-12 Jun-12 Sep-12 Dec-12 Mar-13 Jun-13 Brazil ESALQ Europe Rotterdam R$/m³ €/m³
    • Q1 2013/14 – Revenues Materially Up on Higher Volumes in Brazil and Higher Prices in Europe 6 Net Revenues (R$ MM) +17.6%  Revenue growth supported by:  Higher sales volumes for the entire sugarcane segment and starch & sweeteners  Higher prices for starch & sweeteners products and ethanol (Brazil and Europe)  But partially offset by:  Lower sugar prices in Brazil  Reduced ethanol volumes in Europe, although capacity utilization at BENP Lillebonne is progressively improving sequentially 279 240 800 1.016 152 191392 461 Q1 2012/13 Q1 2013/14 Brazil Indian Ocean / Africa Starch Europe Ethanol Europe 1,622 1,908 1622 1908 +110 +47 +91 +38 Q1 2012/13 Volume Price & Mix Currency Others Q1 2013/14
    • 134 +87 +11 (12) (8) (1) 210 Q1 2012/13 Brazil Indian Ocean / Africa Starch Europe Ethanol Europe Holding Q1 2013/14 -2 -3 15 9 67 51 16 27 38 125 Q1 2012/13 Q1 2013/14 Brazil Indian Ocean / Africa Starch Europe Ethanol Europe 134 210 Q1 2013/14 - Adjusted EBITDA Adjusted EBITDA Recovery on Weak Q1 12/13 Thanks to Sugarcane 7  Adjusted EBITDA improved year-on-year as a consequence of:  Significant recovery in volumes in Brazil and related cost dilution, together with positive accounting effect due to late start of the crop  Positive contribution of higher trading activity and favorable sugar sales timing in Indian Ocean/Africa  Adjusted EBITDA for the cereal division improving sequentially  But partially offset by:  Delayed impact of hedging position on cereal costs  Higher energy and input costs in European Alcohol & Ethanol segment on lower volumes Adjusted EBITDA (R$ MM) Margin 11.0%Margin 8.3% +56.7%
    • 107 134 Q1 12/13 Q1 13/14 Own Sales Trading 4,2 5,7 Q1 12/13 Q1 13/14 240 303 Q1 12/13 Q1 13/14 48 13743 10 Q1 12/13 Q1 13/14 Own Sales Trading Ethanol Sales (‘000 m³)Sugarcane Crushing (MM t) Sugar Sales (‘000 t) 8 +26.2% YoY +25.2% YoY Sugarcane Brazil – Production & Sales Harvesting Favored by Renewal/Expansion Programs on Higher Number of Crushing Days Energy Sales (‘000 MWh) +61.8 YoY  Crushing  Recovery in sugarcane volume: 5.7 million tonnes processed (+34.9%) on higher crushing days (59 days vs. 44 days in Q1 12/13)  Yields improving from 88 tonnes/ha to 95 tonnes/ha in Q1 13/14 (+8.0%) with higher sugar content (+4.0%)  Improvement in production  Overall production (expressed in TRS) up 44% to 719,000 tonnes  Mix: 63% sugar, 37% ethanol  Sugar: 436,000 tonnes +51.9% YoY  Ethanol: 155,000 m³ +32.6% YoY  Progress on cogeneration  Volumes (including trading) up 61.8% to 147 GWh, on slightly lower prices year-on-year +34.9% YoY
    • 392 461 (47) +65 +11 +31 +10 Q1 2012/13 Price & Mix Volume Price & Mix Volume Others Q1 2013/14 Sugarcane Brazil – Financials Improvement in Adjusted EBITDA Favored by Higher Production Volumes Key Figures In R$ Million Q1 2013/14 Q1 2012/13 Change Revenues 461 392 18% Gross Profit 93 -6 18x Gross Margin 20.2% -1.6% EBIT 18 (68) -127% EBIT Margin 4.0% -17.5% Adjusted EBITDA 125 38 227% Adjusted EBITDA Margin 27.2% 9.8% CAPEX 122 147 -17% 9 (1) Tereos Internacional allocates tilling expenses as cost. If tilling expenses were allocated as investment, Adjusted EBITDA for Q1 13/14 would have reached R$153.0 million. Net Revenues (R$ MM) Sugar Ethanol  Sugar: 57% of total net revenues  Volumes increased +26.2% to 303,000 tonnes  Average selling price & mix -15.2% Y-o-Y at 870.9 R$/tonne  Ethanol: 36% of total net revenues  Volume sold up +25.2% to 134,000 m3  Prices up 7.3% Y-o-Y at 1,221.4 R$/m3  Cogeneration (ex-trading): R$20.3 million vs. R$7.2 million in Q1 12/13  Adjusted EBITDA: R$125 million  Increase driven by higher volumes, positive effect of dilution of fixed costs and a positive accounting effect of COGS partially related to the delayed start of the crop  Adjusted EBITDA Margin1 for Q1 13/14 including tilling as depreciation: 33.2% Note: Figures for Brazil now exclude JVs
    • 67 77 Q1 12/13 Q1 13/14 117 90 Q1 12/13 Q1 13/14 -22.7% YoY Sugarcane Indian Ocean/Africa – Production and Financials Overall Segment Improvement 10 Sugarcane Crushing (’000 t) Sugar sales (‘000 t) +16.3% YoY Key Figures In R$ Million Q1 2013/14 Q1 2012/13 Change Revenues 191 152 26% Gross Profit 41 35 17% Gross Margin 21.6% 23.1% EBIT 16 11 55% EBIT Margin 8.6% 7.0% Adjusted EBITDA 27 16 67% Adjusted EBITDA Margin 14.0% 10.6% CAPEX 37 37 - Revenue Breakdown by Product  Sugarcane crushing  Indian Ocean: no production in this quarter  Africa: c. 90,000 tonnes crushed (-22.7% Y-o-Y) due to lower yields but production volume only slightly down  Revenues: +26% Y-o-Y  Revenues improvement in both operations on higher volumes tied to positive timing effect in Indian Ocean and better prices in Africa  Adjusted EBITDA: +67% Y-o-Y  Positive contribution of Indian Ocean Sugar Indian Ocean 61% Sugar Africa 7% Trading and others 32%
    • 305 320 Q1 12/13 Q1 12/13 159 125 Q1 12/13 Q1 13/14 450 462 Q1 12/13 Q1 12/13 Cereal Segment - Production and Sales Slightly Higher Sales Volumes, Except for Ethanol 11 Cereal Grinding (‘000 t) Starch & Sweeteners Sales (‘000 t) +2.9% YoY +2.6% YoY Co-products Sales (‘000 t) +6.2% YoY Alcohol & Ethanol Sales (‘000 m3) -21.3% YoY  Grinding in Q1 13/14: +2.9% Y-o-Y, on additional capacity in Palmital factory in Brazil and Marckolsheim in Europe. Sequentially, Lillebonne factory is improving capacity utilization to over 80% in Q1 13/14  Starch & Sweeteners sales: +2.6% Volumes growth in most product categories, notably functional sweeteners, starches and co-products  Alcohol & Ethanol sales: -21.3% Lower ethanol sales due to factory diversification (liquid dextrose production start-up) and Lillebonne gluten ramp-up 808 831 Q1 12/13 Q1 12/13
    • Starch & Sweeteners – Financials Positive Volume and Price Effect, but Profitability Still Impacted by High Cereal Input Prices 12 Net Revenues (R$ MM)  Revenues: R$1,016 million, up 27%  Better mix and prices in all product categories (+9.7% Y-o-Y, of which +5.6% in Starch & Sweeteners), reflecting partially increase in grain prices  Growth in volumes (+7.9%) due to higher sales of functional sweeteners, starches and co-products (impact from recent investments notably Lillebonne and Marckolsheim)  Adjusted EBITDA: R$51 million, down 25% Y-o-Y, but up sequentially (+36.7%)  Delayed effect of hedging positions on cereals impacted profitability, although improved sequentially  Increase in energy prices and consumption Key Figures In R$ Million Q1 2013/14 Q1 2012/13 Change Revenues 1,016 801 27% Gross Profit 164 171 -4% Gross Margin 16.1% 21.3% EBIT 15 37 -59% EBIT Margin 1.5% 4.6% Adjusted EBITDA 51 67 -25% Adjusted EBITDA Margin 5.0% 8.4% CAPEX 77 75 2.7% 801 1,016 +63 +77 +60 +15 Q1 2012/13 Volume Price & Mix Currency Others Q1 2013/14
    • Alcohol & Ethanol Europe – Financials Reduced Volumes Y-o-Y on Factory Diversification and Lower Capacity Utilization  Revenues: R$240 million, down 14%  Positive price impact in the segment: +4.3%  Lower ethanol volumes Y-o-Y due to Lillebonne diversification, but continued progress sequentially  Adjusted EBITDA: R$9 million, down 36% Y-o-Y, but up sequentially (+R$9 million)  Higher energy and input costs 13 Net Revenues (R$ MM) Revenue Breakdown by Product Key Figures In R$ Million Q1 2013/14 Q1 2012/13 Change Revenues 240 279 -14% Gross Profit 11 21 -47% Gross Margin 4.6 % 7.5% EBIT (0) 4 -111% EBIT Margin -0.2% 1.4% Adjusted EBITDA 9 15 -36% Adjusted EBITDA Margin 3.8% 5.3% CAPEX 1 73 -99% Ethanol own sales 50% Ethanol traded 43% Co-products and other 7% Note: Figures for Alcohol & Ethanol segment now exclude JVs 279 240 (77) +12 +21 +5 1T 2012/13 Volume Preço & Mix Moeda Outros 1T 2013/14
    • 14 Cash Flow Reconciliation Cash Flow In R$ Million Q1 13/14 Adjusted EBITDA 210 Working capital variance (357) Others (28) Operating Cash Flow (175) Financial interests (41) Dividends paid and received (1) Capex (239) Others (16) Free Cash Flow (473) Forex impact (313) Others 6 Net Debt Variation (779)  Working Capital Partially related to higher seasonal inventories, currency impact on receivables and inventories, as well as payables cycle  CAPEX (-28.4% Y-o-Y) Brazil: 51% of consolidated CAPEX (-16.6% Y-o-Y):  Expansion/renewal planting program  Capacity / cogen expansion program  Higher intercrop maintenance  75% of the investment program completed Cereals: 32% of consolidated CAPEX (-47.3% Y-o-Y):  Mostly related to starch project in Brazil  Currency Effect on Debt Devaluation of the Real against Euro (-10.7%) and USD (-9.4%)
    • Debt Working Capital and Currency Effect Impacted Net Debt  Net Debt/Adjusted EBITDA: 4.7x vs. 4.4x on March 31st, 2013 15 Debt In R$ Million June 30th, 2013 March 31th, 2013 (Restated) ∆ Current 2,064 1,829 775 Non-current 2,595 2,399 196 Amortized cost (26) (26) - Total Gross Debt 4,633 4,202 431 In € 1,828 1,596 232 In USD 1,832 1,688 144 In R$ 921 882 39 Other currencies 78 62 16 Cash and Cash Equivalent (583) (893) 310 Total Net Debt 4,050 3,309 741 Related Parties Net Debt 51 12 39 Total Net Debt + Related Parties 4,101 3,321 779
    •  Cereals  Moving forward with expansion projects:  China: Engineering and equipment purchases mostly done at Dongguan, while civil works are underway. Most approvals from the Chinese authorities now received for Tieling acquisition  Brazil: production of corn-based glucose at Palmital expected for Q2 13/14  Positive impact of lower wheat purchase price to be felt progressively in Q2 13/14  Benefit of diversification projects in Europe (Saragossa and Lillebonne) to come through progressively in the year.  Sugarcane  Renewal/expansion program of previous years has reduced average age of sugarcane to 3.3 years  No impact of frosts experienced in Center-South region of Brazil and crushing estimates maintained at c. 18.5 million tonnes (adjusted for JVs, and equivalent to c. 20 million tonnes on a full consolidation basis)  Full benefit of higher industrial utilization rates to dilute fixed costs, despite lower sugar prices  Positive contribution of higher cogeneration (expected to double Y-o-Y) and PIS/COFINS tax cut  Guarani 2015/16 program led by recently appointed new CEO 16 Outlook
    • IR Contact Marcus Thieme Investor Relations Officer Felipe Mendes Investor Relations Manager Phone: +55 (11) 3544 4900 Email: ir@tereosinternacional.com www.tereosinternacional.com