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Cielo gs (2)

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  • 1. GOLDMAN SACHS FINTECH October, 2013
  • 2. DISCLAIMER The Company makes forward looking statements that are subject to risks and uncertainties. These statements are based on the beliefs and assumptions of our management as well as on information currently available to us. Forward-looking statements include information regarding our current intent, beliefs or expectations, in addition to those of the members of the Board of Directors and Executive Officers of the Company. Forward-looking statements also include information regarding our possible or assumed future operating results, as well as statements preceded or followed by, or that include, the words ''believes”, ''may”, ''will”, ''continues”, ''expects”, ''anticipates”, ''intends”, ''plans”, ''estimates”, or similar expressions. Forward-looking statements are not guarantees of performance. They involve risks, uncertainties and assumptions, for they relate to future events, thus depending on circumstances that may or may not occur. Our future results and the creation of value to shareholder s may differ significantly from those expressed in or suggested by these forward-looking statements. Many factors determining these results and values are beyond Cielo’s ability to control or predict.
  • 3. #1MERCHANT ACQUIRER AND PAYMENT PROCESSOR IN BRAZIL AND LATIN AMERICA PRESENTIN MORETHAN OF BRAZILIAN MUNICIPALITIES MARKET CAP – AMONG 12 LARGEST IN BM&FBOVESPA BRL 45 BILLION99.6% EXCHANGE RATE: 1USD = BRL2.38 CIELO | LEADING MERCHANT ACQUIRER 3
  • 4. 1995 4 Visa acquirers 2009 2010 June 2009 Single Visa Acquirer R$ 8.4 billion IPO + Multi-brand acquirer CIELO | TIMELINE 4
  • 5. CIELO|MARKET DRIVEN BY POWERFUL SECULAR TRENDS Source: IBGE,ABECS 5 1,594 1,787 1,980 2,249 2,499 2,745 723 741 2007 2008 2009 2010 2011 2012 1Q13 2Q13 Consumer Expedinture (R$ billion) 16,4% 18,4% 19,9% 21,7% 24,1% 25,9% 25,2% 26,3% 2007 2008 2009 2010 2011 2012 1Q13 2Q13 Card Expenditure over Consumer Expenditure (%) 262 329 394 487 601 710 182 195 2007 2008 2009 2010 2011 2012 1Q13 2Q13 Card Expenditure (R$ billion)* * Excluding Private Labels
  • 6. CIELO| LEADER IN A GROWING AND UNIQUE MARKET Unique Credit Product • Credit in Installments product which represents 1/3 of our total financial volume Fully Integrated Business Model • Present in the whole value chain: affiliation, capturing, processing and settlement Prepayment of Receivables • Relevant business capturing ~15% of total credit volume Industry Structure • Strong concentration as a consequence of the concentration in the banking business 6
  • 7. CIELO| STRATEGIC PLANNING Launching the new e-commerce platform Acquisition of M4U JV between Oi and Cielo Launching of Cielo Mobile iOs System Acquisition of Braspag Launching of Cielo Mobile Android November 2010 June 2011 August 2010 May 2011 March 2012 September 2012 Partnership with CyberSource Acquisition of MeS January 2010 September 2010 November 2012 Partnership with Facebook Partnership with Planet Payment Cielo has been active in M&A and partnerships to be well positioned in eCommerce and mobile payment 7
  • 8. CIELO| NEW PRODUCTS CIELO PREMIA Cielo’s offering is the most comprehensive available including some unique products CIELO FIDELIDADE CIELO CREDIÁRIO CIELO LINKCI • Loyalty program developed exclusively to merchants • Largest B2B in Latin America • Accrual of points based on merchant’s volume with Cielo • Most flexible and the easiest to use promotional marketing tool in the market • Can be offered to merchants, brands and issuers • Additional payment method that allows cardholders to pay in up to 48 installments, accessing a pre- approved credit line from their checking accounts through their bank cards • Allows the merchant to offer check-in solution to its customers and the possibility to develop free advertising • Allows the cardholder to recommend its favorite locals and redeem rewards 8
  • 9. CIELO| NEW TECHNOLOGIES 9 Cielo invests in new technologies for capturing devices we make available to our merchants • Wireless POS terminals (GPRS)  Corresponds to 52% of Cielo’s installed basis  Strong demand from our merchants • NFC (Near Field Communication)  Up to now, 600 thousand terminals installed with such technology
  • 10. CIELO | TRANSACTION CAPTURED VOLUME 10 58,570 63,313 65,652 33,150 35,534 39,039 2Q12 1Q13 2Q13 Quartely Evolution (R$ million) Credit Debit 98,847 104,691 91,721 14.1% 5.9% 110,897 134,792 162,933 197,541 241,552 64,655 79,166 98,742 118,314 138,368 2008 2009 2010 2011 2012 Annual Evolution (R$ million) Credit Debit 175,552 213,958 261,675 315,855 379,920 CAGR: 21.3%
  • 11. CIELO | EBITDA 11 704.4 874.5 859.1 56.6% 56.5% 53.5% 30,0% 35,0% 40,0% 45,0% 50,0% 55,0% 60,0% 65,0% 70,0% 75,0% 80,0% 0,0 100,0 200,0 300,0 400,0 500,0 600,0 700,0 800,0 900,0 1.000,0 2Q12 1Q13 2Q13 Quartely Evolution (R$ million) EBITDA EBITDA Margin 22.0% -1.8% *As of 4Q2012 numbers were impacted due to the consolidation of Merchant e-Solutions, a US-based company acquired by Cielo. 1.776 2.268 2.564 2.408 3.083 62% 66% 64% 57% 57% 0 500 1.000 1.500 2.000 2.500 3.000 3.500 45% 50% 55% 60% 65% 70% 75% 80% 2008 2009 2010 2011 2012* Annual Evolution (R$ million) EBITDA EBITDA Margin CAGR: 14.8%
  • 12. CIELO | NET INCOME 12 548.9 640.9 623.3 44.1% 41.4% 38.8% 5,0% 15,0% 25,0% 35,0% 45,0% 55,0% 65,0% 75,0% 0,0 100,0 200,0 300,0 400,0 500,0 600,0 700,0 2Q12 1Q13 2Q13 Quartely Evolution (R$ million) Net Income Net Margin 13.6% -2.7% *As of 4Q2012 numbers were impacted due to the consolidation of Merchant e-Solutions, a US-based company acquired by Cielo. 1.126 1.529 1.831 1.817 2.321 39% 44% 46% 43% 43% 0 500 1.000 1.500 2.000 32% 37% 42% 47% 52% 2008 2009 2010 2011 2012* Annual Evolution (R$ million) Net Income Net Margin CAGR: 19.8%
  • 13. OUTLOOK | SOME KEY CONSIDERATIONS 13 • Brazilian Central Bank named the official regulator , should issue rules for the sector Regulatory Environment • New business model adopted by second largest player • New players gaining market share Competitive Landscape • Economic activity remains a question mark • Moderated increase in inflation benefits the business in the short term Macroeconomic Scenery
  • 14. CIELO | INVESTMENT HIGHLIGHTS Leader in a growing market Strong balance sheet, high cash generation and low capex requirements Minimum dividend pay out of 50% of net profit* distributed twice a year Focus on innovation and continuous growth * After constitution of legal reserve of 20% of the Company´s capital stock 14
  • 15. INVESTOR RELATIONS CONTACTS www.cielo.com.br/ri E-mail: ri@cielo.com.br | Phone: + 55 11 2184 7722