Conference Call 3Q13.

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Conference Call 3Q13.

  1. 1. 3rd QUARTER 2013 EARNINGS RESULTS Job Position October 31, 2013
  2. 2. Forward-Looking Statements This presentation may contain forward-looking statements, projections and estimates regarding circumstances or events yet to take place, including, but not limited to, those statements relating to guidance. These forward-looking statements are based largely on current expectations, forecasts of future events and industry and financial trends that affect Embraer’s businesses. These statements are subject to risks, uncertainties and assumptions that include, among others: general economic, political and trade conditions, both in Brazil and in those markets where Embraer does business; management’s expectations and estimates concerning the company’s future financial performance; plans and objectives of our management; financing plans and programs, and the effects of competition; industry trends and growth opportunities; inflation and fluctuations in exchange rates; the company’s investment plans; Embraer’s operating efficiencies and synergies and its capacity to develop and deliver products on the dates previously agreed upon; results of operation; business strategies; benefits of new technologies and existing and future governmental regulations. To obtain further information on factors that may lead to results different from those forecast by Embraer, please consult the reports Embraer files with the U.S. Securities and Exchange Commission (SEC) and the Brazilian Comissão de Valores Mobiliários (CVM) and in particular the factors discussed under “Forward-Looking Statements” and “Risk Factors” in Embraer’s annual report on Form 20−F. The words “believe”, “may”, “will”, “estimate”, “intend”, “continue”, “anticipate”, “expect” and other similar terms are intended to identify forward-looking statements. Embraer does not undertake any obligation to publish updates or to revise any forwardlooking statements due to new information, future events or any other factors. In view of the inherent risks and uncertainties, such estimates, events and circumstances may not occur. The actual results and performance of Embraer could therefore differ substantially from those anticipated in Embraer's forward-looking statements. 2
  3. 3. Corporate Highlights Embraer listed for the 4th consecutive year on the Dow Jones Sustainability Index. As part of Embraer’s ongoing liability management, the company completed an exchange offer in which principal value of Notes with maturity in 2017 and 2020 were exchanged for Notes with maturity in 2023. Embraer elected for the 5th consecutive year as one of the best companies to work for in Brazil and for 2nd consecutive year as the best Brazilian company in people management. Embraer elected as one of the best companies for shareholders in Brazil. Embraer was chosen for the 15th consecutive year as one of the most transparent companies in Brazil. Embraer was awarded as the best company in its sector and the best in social responsibility by two major Brazilian publications. 3
  4. 4. Highlights Delivery of 19 E-Jets in 3Q13 reaching 966 total deliveries since EIS. Delivery of the 1,000th E-Jet production aircraft to Republic Airlines, which is being operated on behalf of American Eagle. KLM Cityhopper added six E190 jets to its fleet. Belavia Airways signed a firm contract for two E195s. Aurigny Air Services signed a firm order for one E195 jet. 4
  5. 5. Highlights Delivery of 25 executive jets in 3Q13 (21 light jets and 4 large jets). First China-assembled Legacy 650 successfully completed its maiden flight. For the 2nd consecutive year, Embraer Executive Jets earned high honors in the Aviation International News (AIN) Product Support 2013 survey. Legacy 500 flight test campaign advances as planned, with 3 prototypes accomplishing more than 650 flight hours. Legacy 450 development is on track with the beginning of the first prototype assembly. Enhancements in range, cabin space and interior were also incorporated into the program. Jackie Chan was announced as the launch customer of the Legacy 500 in China. Launching of the new Lineage 1000E at NBAA. 5
  6. 6. Highlights Embraer Defense & Security delivered the first modernized A-1 (A-1M) fighter jet to the Brazilian Air Force. First flight of the Brazilian Navy´s AF-1 (A-4 Skyhawk). The modernization program continues on track. Embraer Defense & Security acquired remaining 50% of Atech´s shares. Embraer on schedule with Jacksonville A-29 Super Tucano assembly facility with first deliveries scheduled for mid-2014. Visiona selected the suppliers for the satellite and the launcher for the Geostationary Defense and Strategic Communication Satellite. Orbisat Indústria e Aerolevantamento S/A changed to Bradar Indústria S/A and announced contracts in the areas of radar and remote surveillance of approximately US$ 22 million. 6
  7. 7. Firm Order Backlog US$ Billion 17.1 12.4 4Q12 1Q13 2Q13 3Q13 13.3 3Q12 7 12.5 17.8
  8. 8. Aircraft Deliveries Commercial Jets Executive Jets 37 27 23 22 17 19 23 11 8 16 4 2 3Q12 4Q12 1Q13 2Q13 3Q13 3Q12 4Q12 6 4 1Q13 2Q13 3Q13 Light Jets - Phenom 2013 deliveries estimates • 90 - 95 commercial jets • 25 - 30 executive large jets • 80 - 90 executive light jets 8 21 Large Jets - Legacy & Lineage
  9. 9. Net Revenues by Segment – 2013 Outlook EMBRAER: US$ 5.90 – 6.40 Billion Commercial Aviation: US$ 3.20 – 3.35 Billion 2013 YTD: 3,931 2013 YTD: 2,187 1,898 1,557 1,402 1,086 3Q12 4Q12 1Q13 1,288 956 2Q13 3Q13 Executive Aviation: US$ 1.40 – 1.60 Billion 3Q12 864 4Q12 640 1Q13 860 2Q13 687 3Q13 Defense & Security: US$ 1.25 – 1.35 Billion 2013 YTD: 860 2013 YTD: 828 712 370 3Q12 9 315 257 297 252 309 267 2Q13 3Q13 3Q12 4Q12 1Q13 2Q13 3Q13 175 167 4Q12 1Q13
  10. 10. Net Revenues US$ Million R$ Million 2013 YTD: 3,931 2013 YTD: 8,340 3,913 1,898 1,557 1,402 1,288 1,086 3Q12 4Q12 1Q13 2Q13 3Q13 3,240 2,845 2,157 3Q12 4Q12 2013 Outlook: US$ 5.9 – 6.4 Billion 10 2,944 1Q13 2Q13 3Q13
  11. 11. SG&A Expenses US$ Million R$ Million 2013 YTD: 499 2013 YTD: 1,055 449 218 170 75 161 163 344 51 120 121 112 224 2Q13 3Q13 3Q12 54 59 53 143 111 3Q12 175 108 4Q12 1Q13 361 373 321 111 117 250 256 2Q13 3Q13 106 295 G&A Expenses 11 154 215 4Q12 Selling Expenses 1Q13
  12. 12. Income from Operations US$ Million R$ Million 2013 YTD: 251 / 6.4% 2013 YTD: 538 / 6.4% 12.0% 12.0% 8.8% 8.7% 7.2% 5.9% 7.2% 5.9% 3.7% 3.6% 469 228 135 285 205 101 173 76 79 40 3Q12 4Q12 1Q13 2Q13 3Q13 EBIT 2013 Outlook: 12 3Q12 4Q12 1Q13 EBIT Margin EBIT: US$ 530 – 610 Million EBIT Margin: 9.0% – 9.5% 2Q13 3Q13
  13. 13. EBITDA US$ Million R$ Million 2013 YTD: 460 / 11.7% 2013 YTD: 987 / 11.8% 16.3% 16.3% 13.1% 12.0% 12.1% 638 310 427 204 168 156 340 1Q13 2Q13 3Q13 EBITDA 3Q12 4Q12 1Q13 EBITDA Margin EBITDA: US$ 770 – 900 Million 2013 Outlook: EBITDA Margin: 13.0% – 14.0% 13 359 201 100 4Q12 12.2% 9.3% 9.2% 3Q12 13.2% 12.0% 2Q13 3Q13
  14. 14. Net Income US$ Million 2013 YTD: 78 / 2.0% 2013 YTD: 170 / 2.0% 6.5% 6.5% 4.7% 4.1% 4.6% 4.0% 2.8% 2.9% -0.3% -0.3% 254 123 65 53 133 119 62 30 (5) 3Q12 4Q12 1Q13 2Q13 (10) 3Q13 Net Income 14 3Q12 4Q12 Net Margin 1Q13 2Q13 3Q13
  15. 15. Inventories US$ Million 2,780 2,585 2,510 2,523 1Q13 2Q13 2,157 3Q12 15 4Q12 3Q13
  16. 16. Free Cash Flow 2013 YTD: (283) US$ Million 439 202 186 102 2 (30) (50) (58) (138) (83) (163) (106) (125) (50) (68) (84) (60) (80) 2Q13 3Q13 (75) (201) 3Q12 4Q12 1Q13 3Q12 Net cash generated (used) by operating activities* Additions to property, plant and equipment Additions to intangible assets Free Cash Flow * Net of Financial assets adjustment 16 (30) (50) (58) (138) 4Q12 439 (163) (75) 202 1Q13 (83) (50) (68) (201) 2Q13 186 (125) (60) 2 3Q13 YTD13 102 (106) (80) 206 (281) (208) (84) (283)
  17. 17. Investments 2013 YTD: 389 US$ Million 300 49 183 180 145 100 61 PESQUISA DESENVOLVIMENTO CAPEX 2013 YTD 2013 Outlook Contracted CAPEX (mainly for Defense & Security Programs) 2013 Outlook: US$ 580 Million 17
  18. 18. Indebtedness Profile / Net Cash/Debt Indebtedness Maturity 17% 6.0 83% 16% 15% 5.1 5.8 84% 85% Net Cash/Debt – US$ Million 4% 6% 6.3 5.4 94% 309 96% 123 98 58 (20) 3Q12 4Q12 1Q13 2Q13 3Q13 3Q12 4Q12 1Q13 2Q13 3Q13 Long-term Short-term Loans Average Maturity (Years) Total Debt 3Q13 18 US$ 2.19 Billion Total Cash 3Q13 US$ 2.17 Billion

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