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Conference Call 4Q12
 

Conference Call 4Q12

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    Conference Call 4Q12 Conference Call 4Q12 Presentation Transcript

    • FOURTH QUARTER & FY 2012 EARNINGS RESULTS March 13, 2013
    • 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 forward- looking 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 Embraers forward-looking statements.2
    • Corporate Highlights • Operational performance surpassed 2012 outlook. • Embraer was elected for the 4th consecutive year as one of the best companies to work for and the best company in people management in Brazil. • Embraer wins FINEP Innovation Award for the 2nd consecutive year. • Embraer was chosen again as one of the most transparent companies in Brazil in 2012.3
    • Corporate Highlights • Embraer listed for the 3rd consecutive year on the Dow Jones Sustainability Index. • Embraer opened two new Centers of Excellence in Évora, Portugal. • Embraer opened an Engineering Center in Belo Horizonte and broke ground for another in Melbourne, Florida. • Embraer Education and Research Institute inaugurated in the city of Botucatu, a new unit of the Embraer High School.4
    • Highlights • Delivery of 106 E-Jets in 2012 (23 in 4Q12), reaching 908 total deliveries since EIS. • Embraer welcomed seven new E-Jets operators in 2012: Bulgaria Air, Estonian, Belavia, Conviasa, Myanma Airways, TUI Travel – Jetairfly and FLYNONSTOP. • 56 new E-Jets were sold in 2012, reaching 1,093 aircraft and a customer base of 62 airlines in 42 countries.5
    • Highlights • Republic Airways signed a contract for 47 E175 Jets + 47 options. Aldus Aviation also signed a contract for 20 E-Jets + 15 options. • Delivery of the 900th E-Jet to Kenya Airways. • E-Jets Second Generation suppliers selection: Pratt & Whitney’s PurePower engines and Honeywell avionics.6
    • Highlights • Delivery of 99 executive jets in 2012 (77 light jets and 22 large jets). 53 jets delivered in 4Q12. • Phenom 300 program reached two milestones: 100th delivery and first flight of U.S.A. manufactured aircraft. • Delivery of 200th Legacy600/650 jet to China’s Minsheng Financial Leasing. • Legacy 500 first flight.7
    • Highlights • Embraer Executive Jets launched Legacy 450 fabrication. • Embraer Executive Jets wins acclaim for product support from Aviation International News (AIN) and Professional Pilot magazines. • HEAI started the Legacy 600/650 production in Harbin, China and ICBC Leasing ordered 10 aircraft to be made in this unit. • Expansion of authorized service center network with 12 new facilities added in 2012.8
    • Highlights • Defense & Security revenues grew 24% in 2012 and surpassed the historical level of US$ 1.0 billion. • Brazilian Army signed contract for Sisfron, Phase I. • Visiona, a joint venture between Embraer and Telebras, was created to participate in the Brazilian Geostationary Satellite program. • KC-390 development program ongoing and on schedule.9
    • Highlights • Two of the three EMB 145 AEW&C were delivered to the Indian Government. • Delivery of the first four A-29 Super Tucano to Indonesian Air Force, the first one to Mauritania and first three to the National Air Force of Angola. • The U.S. Air Force selected the Super Tucano for the LAS program. • Contract signed for EMB 145 AEW&C surveillance aircraft modernization for the Brazilian Air Force.10
    • Aircraft Deliveries Commercial Jets Executive Jets 126 165 98 83 77 125 101 105 106 2 37 21 19 16 22 2008 2009 2010 2011 2012 2008 2009 2010 2011 2012 Light Jets - Phenom Large Jets - Legacy & Lineage11
    • Firm Order Backlog US$ Billion Executive Defense & 15.4 14.7 Aviation Security 12.9 12.4 12.5 26% 28% Commercial Aviation 46% 4Q11 1Q12 2Q12 3Q12 4Q1212
    • Net Revenues US$ Million 6,335 6,178 5,498 5,364 5,803 2008 2009 2010 2011 2012 2012 Outlook: US$ 5.8 – 6.2 Billion 2008: USGAAP 2009-2012: IFRS13
    • Net Revenues Breakdown Net Revenues by Segment Net Revenues by RegionRevenues RevenuesUS$ Billion 5.36 5.80 6.18 US$ Billion 5.36 5.80 6.18 1% 1% 1% 4% 4% 6% 15% 15% 17% 22% 23% 22% 23% 19% 21% 13% 17% 14% 15% 3% 11% 31% 61% 65% 61% 25% 33% 20% 24% 13% 2010 2011 2012 2010 2011 2012 Commercial Aviation Defense and Security North America Europe Latin America Executive Aviation Others Brazil Asia Pacific Others14
    • Net Revenues US$ Million R$ Million Total 2012: 6,178 Total 2012: 12,202 2,025 1,900 3,918 1,717 3,667 3,385 1,405 2,850 1,156 2,049 4Q11 1Q12 2Q12 3Q12 4Q12 4Q11 1Q12 2Q12 3Q12 4Q1215
    • SG&A Expenses US$ Million 10% 11% 12% 12% 9% 280 262 232 198 191 483 393 374 420 302 2008 2009 2010 2011 2012 G&A Expenses Selling Expenses Expenses / Net Revenues 2008: USGAAP 2009-2012: IFRS16
    • Income from Operations US$ Million 9.9% 8.5% 6.9% 7.3% 5.5% 612 537 379 392 318 2008 2009 2010 2011 2012 EBIT EBIT Margin EBIT: US$ 520 – 590 Million 2012 Outlook: EBIT Margin: 9.0% – 9.5% 2008: USGAAP 2009-2012: IFRS17
    • Income from Operations US$ Million R$ Million Total 2012: 612 / 9.9% Total 2012: 1,218 / 10.0% 12.0% 12.0% 11.5% 11.5% 7.4% 7.2% 7.5% 7.2% -0.3% 228 -0.4% 469 197 390 86 101 205 153 (15) (6) 4Q11 1Q12 2Q12 3Q12 4Q12 4Q11 1Q12 2Q12 3Q12 4Q12 EBIT EBIT Margin18
    • EBITDA US$ Million 14.4% 11.1% 11.4% 9.6% 9.6% 891 608 609 611 557 2008 2009 2010 2011 2012 EBITDA EBITDA Margin EBITDA: US$ 720 – 840 Million 2012 Outlook: EBITDA Margin: 12.5% – 13.5% 2008: USGAAP 2009-2012: IFRS19
    • EBITDA US$ Million R$ Million Total 2012: 891 / 14.4% Total 2012: 1,766 / 14.5% 16.4% 16.4% 15.4% 15.5% 12.8% 12.9% 11.8% 11.8% 312 641 2.9% 265 2.8% 524 148 166 337 264 59 101 4Q11 1Q12 2Q12 3Q12 4Q12 4Q11 1Q12 2Q12 3Q12 4Q12 EBITDA EBITDA Margin20
    • Net Income US$ Million 8.5% 6.1% 6.2% 5.6% 1.9% 465 389 330 348 112 2008 2009 2010 2011 2012 Net Income Net Margin 2008: USGAAP 2009-2012: IFRS21
    • Net Income US$ Million R$ Million Total 2012: 348 / 5.6% Total 2012: 698 / 5.7% 9.1% 6.5% 9.2% 6.5% 4.6% 3.2% 4.6% 3.7% 105 123 254 188 55 65 124 133 -4.5% -4.7% (92) (172) 4Q11 1Q12 2Q12 3Q12 4Q12 4Q11 1Q12 2Q12 3Q12 4Q12 Net Income Net Margin22
    • EPADS and Pay Out US$ 116% 52% 34% 26% 26% 2.57 2.14 1.83 1.92 0.62 2008 2009 2010 2011 2012 EPADS Pay Out 2008: USGAAP 2009-2012: IFRS23
    • Inventories US$ Million 2,837 2,445 2,198 2,288 2,155 2008 2009 2010 2011 2012 2008: USGAAP 2009-2012: IFRS24
    • Free Cash Flow Total 2012: (81) US$ Million 277 206 414 444 155 25 (30) (77) (70) (76) (50) (40) (163) (60) (55) (58) (65) (138) (76) (174) 4Q11 1Q12 2Q12 3Q12 4Q12 Free cash flow Additions to PP&E Net cash generated (used) by operating activities* Additions to Intangible * Net of Financial assets adjustment25
    • Investments US$ Million 350 251 211 200 77 100 RESEARCH DEVELOPMENT CAPEX 2012 Total 2012 Outlook 2012 Outlook: US$ 650 Million Total Investment 2012: US$ 539 Million26
    • Indebtedness Profile / Net Cash Indebtedness Maturity Net Cash – US$ Million 15% 22% 17% 16% 26% 6,1 6,0 4,8 5,8 4,2 446 85% 78% 83% 84% 74% 302 290 313 123 4Q11 1Q12 2Q12 3Q12 4Q12 4Q11 1Q12 2Q12 3Q12 4Q12 Long-term Short-term Loans Average Maturity (Years) Total Debt 4Q12 US$ 2.07 Billion Total Cash 4Q12 US$ 2.38 Billion27
    • Investor RelationsPhone: +55 12 3927 4404investor.relations@embraer.com.brwww.embraer.com