Duratex - 1st Quarter 2009

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Duratex - 1st Quarter 2009

  1. 1. Disclosure of Results 1st Quarter 2009 May / 2009 1
  2. 2. Competitive Advantages Wood • Brand; • Production scale: • Design;  biggest player in Brazil; • N ti Nationwide coverage: id • Lowest wood cost placed at the  market, distribution and technical factories, among all players; assistance; • Close to the major consumer j • Wide product lines aimed to centers; different segments of consumption: • High degree of verticalization:  high medium and low income; high,  wood, d • Production scale;  coating lines and • Leadership.  resin from year end on; • Wide product line and standards. 2
  3. 3. Competitive Advantages Wood Division MDF & Flooring Agudos - SP MDP Itapetininga - SP 100% of timber land located in MDF & Hardboard São Paulo State. Botucatu - SP 3
  4. 4. Competitive Advantages Metals - São Paulo Deca Division Metals & Ceramics - Jundiaí Ceramics Cabo de Sto Agostinho - PE Ceramics Queimados - RJ Ceramics São Leopoldo - RS Ceramics Jundiaí - SP 4
  5. 5. Favorable Scenario Civil Construction Industry Incentive plan for the construction industry: Federal Government • Increase of the financing limit, through FGTS, from R$ 350.000 to R$ 500.000; • Tax exemption for building materials (IPI reduction); • Construction of 1.000.000 houses; • Subsidized credit to low income families; • Program estimated at R$ 34 billion. 5
  6. 6. Favorable Scenario Consumption per capita of panels in Brazil 13,6 13,5 MDP 10,7 11,9 11 9 11,4 11,7 11 7 (in m3 / year) 2003 2004 2005 2006 2007 2008 (Source: ABIPA and IBGE) 10,8 11,3 MDF 9,8 (in m3 / year) 7,6 7,6 5,7 (Source: ABIPA and IBGE) 2003 2004 2005 2006 2007 2008 6
  7. 7. Favorable Scenario Worldwide consumption of panels per capita (in m3 / year) 47 20 17 19 16 8 Europe 46 USA China 22 13 11 Australia Brazil MDF MDP 2007 – EUROPE, 2008 (Projection) – USA, BRAZIL, CHINA AND AUSTRALIA. Sources: EPF, Abipa and Wikipedia 7
  8. 8. Favorable Scenario Markets Attended Sales Segments 2008 Construção Others 46% 21,5% 21 5% Housing (directly) Furniture 44,7% 33,8% Average construction cycle 6 months 12 months 6 months 8
  9. 9. CAPEX CAPEX (R$ million)  Technology update; 673,4  Leadership in segments of activity with high growth potential and competitive 2.089,9 advantages; 303,5  Integration of processes with focus on 222,3 222 3 172,8 costs savings: t i 138,9 139,4 136,8 108,4 105,4 89,0 • acquisition of land, • coating lines and • resin plant, among others. 09  Low net debt (R$ 542,0 million, equivalent to 00 01 02 03 04 05 06 07 08 1Q 20 20 20 20 20 20 20 20 20 1,44 times EBITDA). 9
  10. 10. CAPEX MDF Expansion underway at the site of Agudos – SP: • MDF line: 800.000 m3/year capacity with equipment in finishing assemby momentum: - 125% growth over Duratex existing MDF capacity. g g p y • Melamine finishing line: 10,2 million m2 capacity; • Resin plant; • Acquisition of land and plantation of forest. 10
  11. 11. Market Announcement 09.Apr.2009: Discontinuation of the Hardboard operation in Jundiaí Duratex informs that, in April, it will discontinue its 3 production lines of hardboard located in the Jundiai (SP) city. These lines have a combined capacity of 150 thousand m3/year and were installed during the 1950s and 60s being outdated when compared to the other existing lines that operate with greater operating cost advantages and higher productivity productivity. Besides, the geographical location of the production site, in the city of Jundiai, demands higher costs both from operations and wood supply. The shutting down momentum coincides with the start-up of a new line located in the city of Agudos (SP) that should aggregate 800 thousand m3/year of capacity, when operational. In that sense, the production of thin panels, currently produced in the lines to be discontinued, will be done in the MDF/HDF/SDF lines located in Agudos and Botucatu (SP) which should generate (SP), relevant cost reductions and productivity gains arisen from the state of the art equipment status. The cash disbursement to discontinue such 3 lines will amount to approximately R$ 8 million as productivity gains and cost reduction will generate R$ 23 million per yearyear. The announced measure is part of Duratex strategic process towards improving its competitive advantages and generating value in its operations. 11
  12. 12. Market Announcement 13.Apr.2009: Postponement by indefinite time of the MDP expansion Duratex, Duratex a Brazilian leading company within the industrialized wooden boards metal fittings and boards, vitreous china segments informs that its management has decided to postpone, indefinitely, the capital expenditures geared to the MDP (Medium Density Particleboard) expansion, disclosed via a Material Fact published on May 7, 2008. This expansion, budgeted at R$ 1,0 billion, with conclusion expected by the second half of 2010, was already postponed through a Market Announcement dated October 10, 2008. By then, the decision making was made with the objective of waiting for the world economic crisis outcome so as to assess the better momentum to continue with the investment thus, preserving the company’s liquidity. The decision making behind such announcement was based in the persistence of the uncertainties related to the extent, duration and intensity of the crisis. Moreover, there is the necessity of keeping a comfortable financial situation to pass through this momentum sustaining an adequate performance and profitability levels levels. Thus, Duratex management believes that the announced measures reinforces our compromise in granting the operation’s sustainability with creation of value to shareholders. 12
  13. 13. Balanced Financial Structure 2005 2006 2007 2008 1T09 Balance Sheet Highlights: Cash 234,0 , 574,6 , 752,7 , 598,1 , 442,9 , Current Assets 726,7 1.138,9 1.355,9 1.321,8 1.127,6 Long-Term Assets 39,1 33,6 64,5 144,4 137,6 Total Assets 1.947,1 2.375,2 2.750,5 3.373,4 3.239,7 Short T Sh Term Debt D b 151,5 151 5 359,4 359 4 246,2 246 2 435,1 435 1 438,4 438 4 Current Liabilities 318,7 601,0 563,3 832,8 779,4 Long Term Debt 439,6 258,8 424,6 649,4 546,6 Long Term Liabilities Long-TermLiabilities 565,5 565 5 377,8 377 8 630,0 630 0 808,5 808 5 700,3 700 3 Minority Interest 12,0 0,6 0,6 0,6 0,2 Equity 1.050,9 1.395,8 1.556,5 1.731,5 1.758,5 Risk Ratios: Current Ratio 2,28 1,90 2,41 1,59 1,45 Equity / Total Assets 54% 59% 57% 51% 54% Debt / Debt + Equity 36% 31% 30% 39% 36% Net Debt 357,1 43,6 -81,9 486,4 542,1 Net Debt / Equity 0,34 0,03 -0,05 0,28 0,31 Net Debt / EBITDA 0,98 0,10 -0,15 0,87 1,44 * annualized 13
  14. 14. Balanced Financial Structure Debt profile Domestic Foreign Currency R$ 984,9 M Currency 100% Hedge 55% 45% 438 Debt amortization schedule (in R$ million) 1Q2009 Debt: . New Debt: R$ 68,1M, Long-term g 251 . Amorti ation R$160,0M. Amortization: R$160 0M 55,5% 86 34 43 43 48 42 Short-term 44,5% 12 2010 2011 2012 2013 2014 2015 2016 and months after 14
  15. 15. Performance 1Q09 Revenue Sources Net Revenue Hardboard 15,4% MDP 12,6% Metal Fittings R$ 393,8 M 24,7% MDF/HDF/SDF/ Laminate Flooring Vitreous China 30,2% 17,1% Revenues origination Domestic Market 91,3% 91 3% Export Revenues 8,7% 15
  16. 16. Performance Net Revenues in the domestic market Domestic revenues 1Q09 10,5% R$ 393,8 M 6,5% 83,0% Market segments Other Wholesale 2,4% Furniture Industry 6,7% , Other 4,3% 58,0% Technical Sales 2,6% Wood Home Center Retail 58,2% 16,3% 55,0% 41,8% 41 8% Retail Builders 30,0% Construction 19,6% 5,10% 16
  17. 17. Performance Non-recurrent events (in R$ million) 1Q08 2Q08 3Q08 4Q08 2008 1Q09 RECLASSIFIED EBITDA (LAW 11.638) 127,8 160,3 141,7 129,5 559,3 94,2 NON-RECURRENT ITEMS 0,0 20,5 (8,7) (8,4) 3,4 (7,6) . Tax credit (COFINS) - 24,0 - - 24,0 - . Acquisition expenditures in Deca - (3,5) (3 5) (1,9) (1 9) - (5,4) (5 4) - . Down payment for future energy consumption - - (6,8) (6,8) (13,6) - . Jundiaí Shutdown - - (1,6) (1,6) (7,6) RECURRENT EBITDA 127,8 139,8 150,4 137,9 555,9 101,8 RECLASSIFIED NET INCOME LAW 11.638 72,2 75,9 98,2 67,6 313,9 46,9 NON-RECURRENT ITEMS 0,0 12,8 9,6 (5,2) 17,2 (4,8) . Tax credit (COFINS) - 15,0 - - 15,0 - . Acquisition expenditures in Deca - (2,2) (2 2) (1,2) (1 2) - (3,4) (3 4) - . Down payment for future energy consumption - - (4,2) (4,2) (8,4) - . Jundiaí Shutdown - - - (1,0) (1,0) (4,8) . Fixed asset divestment (farm) - - 15,0 - 15,0 - RECURRENT NET INCOME 72,2 63,1 88,6 72,8 296,7 51,7 . Stock options (Law 11.638) (5,4) (7,7) (3,5) (3,5) (20,1) (3,5) RECURRENT NET INCOME AFTER OPTIONS 77,6 70,8 92,1 76,3 316,8 55,2 17
  18. 18. Performance Recurrent performance re-classified by Law 11.638 Net Rev.(R$ million) & Gross Margin (%) EBITDA (R$ million) & Margin (%) 40,3% 40,1% 40,6% 40,2% 37,7% 29,9% 29,5% 29,1% 27,8% 517,4 25,9% 495,2 150,4 137,9 , 473,5 127 8 139,8 127,8 , 427,4 101,8 393,8 1Q08 2Q08 3Q08 4Q08 1Q09 1Q08 2Q08 3Q08 4Q08 1Q09 Net Income (R$ million) PL (R$ million) & ROE (%) 21,2% 21 2% 23,9% , 18,7% 19,0% 13,3% 1.701,3 1.731,5 1.758,5 1.596,5 1.645,0 77,6 77 6 92,1 92 1 76,3 70,8 55,2 1Q08 2Q08 3Q08 4Q08 1Q09 1Q08 2Q08 3Q08 4Q08 1Q09 18
  19. 19. Performance Re-classified by Law 11.638 Net Rev.(R$ million) & Gross Margin (%) EBITDA (R$ million) & Margin (%) 40,3% 40,1% 40,6% 39,9% 33,9% 29,9% 35,7% 27,4% 26,1% 517,4 23,9% 495,2 160,3 141,7 , 473,5 127,8 127 8 129,5 427,4 94,2 393,8 1Q08 2Q08 3Q08 4Q08 1Q09 1Q08 2Q08 3Q08 4Q08 1Q09 Net Income (R$ million) PL (R$ million) & ROE (% ªª) 25,6% , 19,6% 20,1% 20 1% 16,7% 11,2% 1.701,3 1.731,5 1.758,5 1.596,5 1.645,0 98,2 98 2 72,2 75,9 9 67,6 46,9 1Q08 2Q08 3Q08 4Q08 1Q09 1Q08 2Q08 3Q08 4Q08 1Q09 19
  20. 20. Performance Wood Recurrent performance re classified by Law 11 638 re-classified 11.638 Shipped Volume (‘000 m³) Net Rev.(R$ M) & Gross Margin (%) EBITDA (R$ M) & Margin (%) 47,0% 39,5% 38,7% 37,8% 37,1% 1.275,9 1.292,3 1.215,0 30,1% 30,3% 1.104,5 28,2% -16,1% -18,3% 410,1 366,1 -23,9% 291,7 244,7 280,5 229,3 84,9 64,6 2007 2008 1Q08 1Q09 2007 2008 1Q08 1Q09 2007 2008 1Q08 1Q09 20
  21. 21. Performance Wood Recurrent performance re classified by Law 11 638 re-classified 11.638 Net Rev.(R$ million) & Gross Margin (%) EBITDA (R$ million) & Margin (%) 38,7% 40,8% 39,7% 39,1% 37,8% 325,8 325 8 309,0 30,2% 31,1% 30,4% 28,8% 30 2% 31 1% 30 4% 28 8% 28,2% 280,5 299,7 229,3 108,8 98,9 89,1 84,7 64,6 1Q08 2Q08 3Q08 4Q08 1Q09 1Q08 2Q08 3Q08 4Q08 1Q09 21
  22. 22. Performance Recurrent performance re classified by Law 11 638 re-classified 11.638 Shipped Volume (‘000 items) Net Rev.(R$ M) & Gross Margin (%) EBITDA (R$ M) & Margin (%) 17.563 41,5% 43,2% 15.041 40,9% 37,5% 698,6 27,2% 29,2% 566,0 26,0% 22,7% +14,9 +14 9 +12,0 3.689 4.239 -13,1% 146,9 164,5 189,8 148,1 42,9 37,3 2007 2008 1Q08 1Q09 2007 2008 1Q08 1Q09 2007 2008 1Q08 1Q09 22
  23. 23. Performance Recurrent performance re classified by Law 11 638 re-classified 11.638 Net Revenues (R$ million) & Gross Margin (%) EBITDA (R$ million) & Margin (%) 43,2% 38,8% 42,2% 41,9% 37,5% 29,2% 26,8% 26,9% 26,2% 191,7 186,3 22,7% , 173,8 164,5 , 146,9 42,9 46,5 51,5 48,8 37,3 1Q08 2Q08 3Q08 4Q08 1Q09 1Q08 2Q08 3Q08 4Q08 1Q09 23
  24. 24. Creating Value (2000 to 2008) EPS  in R$ 1 Acquisition of land and planting of timberland and expansion Deca MDF Expansion Resin Plant MDP Expansion Deca acquisitions 2, 44 * CAGR: +20,5% MDF Expansion 0,55 1,16 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 * EPS by recurrent income of R$316,8M. By reported income of R$313,8M, the EPS would be R$2,42 EBITDA (* recurrent) CAGR: +13,7% Dividend / IOC 555,9 555 9* (in R$ million) CAGR: +22,6% 2007: R$50 million in 110,0 extraordinary dividends y 199,4 199 4 2004: R$15,3 million in 21,5 extraordinary dividends 2000 2001 2002 2003 2004 2005 2006 2007 2008* 2009 2010 2011 2012 24
  25. 25. Disclamer The information contained herein was prepared by Duratex S A and does not S.A. constitute an offering material, to subscribe for or purchase any of the Company’s securities. This material brings general information about the Company and markets as of this date. No representation or warranty, express or implied, is made concerning, and no reliance should be placed on, the accuracy, accuracy fairness or completeness of the information presented herein herein. The Company can give no assurance that expectations disclosed in this p presentation will be confirmed. 12th May 2009 25
  26. 26. Disclosure of Results 1st Quarter 2009 may / 2009 26

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