4th QUARTER & FY 2013
EARNINGS RESULTS

Cargo do Apresentador

February 26, 2014
Forward Looking Statement
This presentation includes forward-looking statements or statements about events or circumstance...
Financial Highlights
The Company met its 2013 outlook for Net Revenues, Margins and Aircraft Deliveries.
Net Revenues reac...
Corporate Highlights
Embraer was awarded and recognized by many renowned publications and
institutions as one of the best ...
Highlights
Delivery of 90 E-Jets in 2013 of which 32 were in 4Q13.

Embraer launched the E-Jets E2 Program which to
date h...
Highlights
Delivery of the 1,000th E-Jet production aircraft to Republic
Airlines, which is being operated on behalf of Am...
Highlights
Delivery of 119 executive jets in 2013 (90 light jets
and 29 large jets). 53 jets delivered in 4Q13.
Phenom fam...
Highlights
First China-assembled Legacy 650 was delivered to first client.

Launch of the new Lineage 1000E.

Embraer Exec...
Highlights
Defense & Security revenues grew 15% in 2013 and reached US$ 1.2 billion.

In the air traffic segment, Atech si...
Highlights
Embraer Defense & Security finished adapting the hangar of the
Jacksonville, Florida plant to start production ...
Aircraft Deliveries
Commercial Jets

Executive Jets

126
98

125
101

105

90
83

106
90

21
2009

2010

2011

2012

2013
...
Firm Order Backlog
US$ Billion

17.1
12.5

12

1Q13

18.2

2Q13

3Q13

4Q13

13.3

4Q12

17.8

Defense &
Security
Executiv...
Net Revenues
US$ Million

5,498

5,791

6,167

5,364

6,235

2009

2010

2011

2012

2013

2013 Outlook: US$ 5.9 – 6.4 Bil...
Revenues Breakdown
Net Revenues by Segment
Revenues
US$ Billion

Net Revenues by Region
Revenues
US$ Billion

6.24

1%
15%...
Net Revenues
Net Revenues - US$ Million

Net Revenues - R$ Million

2013: 6,235

2013: 13,636

2,304

5,296

1,898

3,913
...
SG&A Expenses
US$ Million
9%

11%

12%

12%

11%

279
211

261
198
191

305

2009

G&A Expenses

16

374

419

2010

2011
...
SG&A Expenses
SG&A Expenses - US$ Million

SG&A Expenses - R$ Million
2013: 1,433

2013: 664
449

218
75

161

175
54

108...
Income from Operations
US$ Million
9.9%
6.9%

11.4%

7.3%

9.1%

5.5%

713

612
379

392

2009

2010

566

2012

2013

318...
Income from Operations
Income from Operations - US$ Million

Income from Operations - R$ Million
2013: 1,606 / 11.8%

2013...
EBITDA
US$ Million
14.4%
11.1%

11.4%

16.1%

13.8%

9.6%

1,004

891
609

611

2010

2011

2012

2013

557

2009

857

EB...
EBITDA
EBITDA - US$ Million

EBITDA - R$ Million
2013: 2,239 / 16.4%

2013: 1,004 / 16.1%

23.7%

23.6%

17.3%

16.3%
13.1...
Net Income
US$ Million

8.5%

6.2%

5.6%

5.5%

348

342

2012

2013

1.9%

465
330
112
2009

2010

Net Income

22

2011

...
Net Income
Net Income - US$ Million

Net Income - R$ Million

2013: 342 / 5.5%

2013: 778 / 5.7%

11.5%
6.5%

11.5%
6.5%

...
EPADS and Pay Out
US$
116%

26%

34%

26%

26%

2.57
1.92

1.83

1.88

2012

2013

0.62
2009

2010

2011

EPADS

24

Pay O...
Inventories
US$ Million

2,445
2,198

2009

25

2010

2,288

2011

2,157

2012

2,287

2013
Free Cash Flow
2013: 213

US$ Million

761

496
438

201

186
102

2
(163)
(75)
4Q12

(83)
(50)
(68)

(125)
(60)

(106)
(8...
Investments
US$ Million

Total Investments

534

300
265
193
75

100

RESEARCH

DEVELOPMENT

2013

CAPEX

2013 Outlook

20...
Indebtedness Profile / Net Cash
Indebtedness Maturity

16%

15%

5.8
5.1

84%

85%

Net Cash/Debt - US$ Million

6.3

6%

...
2014 OUTLOOK
2014 Consolidated Outlook
Net Revenues

EBIT

US$ 6.0 – 6.5 Billion

US$ 540 – 620 Million

EBIT Margin

9.0% – 9.5%

EBIT...
2014 Business Units Outlook
Deliveries: 92 to 97 E-jets
Net Revenues

US$ 3.20 – 3.40 Billion

Deliveries: 80 to 90 light ...
2014 Investment Outlook

Research

US$ 80 Million

Development

US$ 320 Million

CAPEX

US$ 250 Million

TOTAL INVESTMENTS...
Investor Relations
Phone: +55 12 3927 4404
investor.relations@embraer.com.br

www.embraer.com
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Conference Call 4Q13

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Conference Call 4Q13

  1. 1. 4th QUARTER & FY 2013 EARNINGS RESULTS Cargo do Apresentador February 26, 2014
  2. 2. Forward Looking Statement This presentation includes forward-looking statements or statements about events or circumstances which have not occurred. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends affecting our business and our future financial performance. These forward-looking statements are subject to risks, uncertainties and assumptions, including, among other things: general economic, political and business conditions, both in Brazil and in our market. The words “believes,” “may,” “will,” “estimates,” “continues,” “anticipates,” “intends,” “expects” and similar words are intended to identify forward-looking statements. We undertake no obligations to update publicly or revise any forward-looking statements because of new information, future events or other factors. In light of these risks and uncertainties, the forward-looking events and circumstances discussed in this presentation might not occur. Our actual results could differ substantially from those anticipated in our forward-looking statements.
  3. 3. Financial Highlights The Company met its 2013 outlook for Net Revenues, Margins and Aircraft Deliveries. Net Revenues reached US$ 6,235 million in 2013 and US$ 2,304 million in 4Q13, representing the highest ever quarterly revenues for the Company. 2013 EBIT and EBIT Margin were US$ 713 million and 11.4%. 2013 EBITDA and EBITDA Margin were US$ 1,004 million and 16.1%. Free Cash Flow was US$ 213 million and Net Cash reached US$ 429 million in 2013. As part of Embraer’s ongoing liability management, the Company completed an exchange offer of Notes extending their maturity until 2023. Total firm order backlog reached US$ 18.2 billion, its highest level in five years. 3
  4. 4. Corporate Highlights Embraer was awarded and recognized by many renowned publications and institutions as one of the best companies in Brazil and abroad in several categories. Embraer joined the World Economic Forum Partnering Against Corruption Initiative (PACI), a global, multi-industry, multi-stakeholder anti-corruption initiative. Embraer listed for the 4th consecutive year on the Dow Jones Sustainability Index and also on the ISE in Brazil. 4
  5. 5. Highlights Delivery of 90 E-Jets in 2013 of which 32 were in 4Q13. Embraer launched the E-Jets E2 Program which to date have reached 200 firm orders plus 200 options. 349 new E-Jets (E1&E2) were sold in 2013, reaching 1,427 aircraft and a customer base of 65 airlines in 45 countries. 5
  6. 6. Highlights Delivery of the 1,000th E-Jet production aircraft to Republic Airlines, which is being operated on behalf of American Eagle. Embraer received American Airlines’ order for up to 150 E175 jets (60 firm plus 90 options). Saratov Airlines became the first Russian E-Jet operator with two E195. Air Costa (India) placed a firm order for 50 E-Jets E2 plus 50 options of the E190-E2 and E195-E2 models. (1Q14) 6
  7. 7. Highlights Delivery of 119 executive jets in 2013 (90 light jets and 29 large jets). 53 jets delivered in 4Q13. Phenom family surpassed 470 aircraft deliveries to 29 countries. Phenom 300 was the most delivered executive jet in the industry in 2013. Legacy 500 reached more than 1,100 hours in flight test campaign. EIS is scheduled for first half of 2014. Legacy 450 first flight in December 2013. EIS expected in 2015. 7
  8. 8. Highlights First China-assembled Legacy 650 was delivered to first client. Launch of the new Lineage 1000E. Embraer Executive Jets won the second place ranking for the second consecutive year in the product support survey from Aviation International News (AIN). Expansion of authorized service center network with six new facilities added in 2013, totaling six wholly-owned and 70 authorized service centers. 8
  9. 9. Highlights Defense & Security revenues grew 15% in 2013 and reached US$ 1.2 billion. In the air traffic segment, Atech signed a contract to implement the SAGITARIO system in several regions of Brazil. Visiona signed contract for the Geostationary Defense and Strategic Communication Satellite. In 2013, Bradar delivered seven Saber M60 low altitude surveillance radars to the Brazilian Armed Forces which now has 22 in operation. It also signed a contract to supply one Sentir M20 radar to the Brazilian Army. 9
  10. 10. Highlights Embraer Defense & Security finished adapting the hangar of the Jacksonville, Florida plant to start production of the Super Tucano. First delivery for the USAF LAS Program scheduled for mid 2014. Delivery of the final three Super Tucano aircraft to the National Air Force of Angola. Embraer Defense & Security delivered the second modernized A-1 (A-1M) fighter jet to the Brazilian Air Force and performed the first flight of the two-seater prototype. KC-390 development program ongoing with the beginning of production of parts for assembly of the first prototype, which will fly for the first time in late 2014. 10
  11. 11. Aircraft Deliveries Commercial Jets Executive Jets 126 98 125 101 105 90 83 106 90 21 2009 2010 2011 2012 2013 19 16 2009 2010 2011 77 22 29 2012 2013 2013 deliveries estimates • 90 - 95 commercial jets • 25 - 30 executive large jets • 80 - 90 executive light jets 11 Light Jets - Phenom Large Jets - Legacy & Lineage
  12. 12. Firm Order Backlog US$ Billion 17.1 12.5 12 1Q13 18.2 2Q13 3Q13 4Q13 13.3 4Q12 17.8 Defense & Security Executive 20% Commercial Aviation Aviation 13% 67%
  13. 13. Net Revenues US$ Million 5,498 5,791 6,167 5,364 6,235 2009 2010 2011 2012 2013 2013 Outlook: US$ 5.9 – 6.4 Billion 13
  14. 14. Revenues Breakdown Net Revenues by Segment Revenues US$ Billion Net Revenues by Region Revenues US$ Billion 6.24 1% 15% 1% 17% 19% 21% 6.24 7% 9% 11% 9% 5% 14% 3% 14% 5% 9% 6% 8% 21% 22% 24% 29% 2011 1% 19% 6.18 20% 6.18 5.79 31% 5.79 2012 2013 11% 27% 17% 65% 2011 61% 2012 Commercial Aviation Executive Aviation 14 25% 53% 2013 Defense & Security Others North America Brazil Europe South & Central America China Asia Pacific Africa & Middle East
  15. 15. Net Revenues Net Revenues - US$ Million Net Revenues - R$ Million 2013: 6,235 2013: 13,636 2,304 5,296 1,898 3,913 1,557 4Q12 15 1Q13 3,240 1,288 1,086 2,944 2Q13 3Q13 2,157 2Q13 3Q13 4Q13 4Q12 1Q13 4Q13
  16. 16. SG&A Expenses US$ Million 9% 11% 12% 12% 11% 279 211 261 198 191 305 2009 G&A Expenses 16 374 419 2010 2011 Selling Expenses 480 454 2012 2013 Expenses / Net Revenues
  17. 17. SG&A Expenses SG&A Expenses - US$ Million SG&A Expenses - R$ Million 2013: 1,433 2013: 664 449 218 75 161 175 54 108 4Q12 1Q13 165 51 121 112 113 2Q13 3Q13 4Q13 373 378 117 120 250 256 258 2Q13 3Q13 4Q13 321 106 295 G&A Expenses 17 361 111 52 53 143 163 154 215 4Q12 1Q13 Selling Expenses
  18. 18. Income from Operations US$ Million 9.9% 6.9% 11.4% 7.3% 9.1% 5.5% 713 612 379 392 2009 2010 566 2012 2013 318 2011 EBIT EBIT Margin Excluding AMR effect 2013 Outlook: 18 EBIT: US$ 530 – 610 Million EBIT Margin: 9.0% – 9.5%
  19. 19. Income from Operations Income from Operations - US$ Million Income from Operations - R$ Million 2013: 1,606 / 11.8% 2013: 713 / 11.4% 20.1% 13.7% 12.0% 20.2% 13.7% 12.0% 8.7% 5.9% 3.6% 8.8% 463 5.9% 3.7% 723 316 469 228 40 4Q12 1Q13 135 2Q13 76 3Q13 79 4Q13 4Q12 EBIT EBIT Margin Excluding AMR effect 19 1,068 1Q13 285 2Q13 173 3Q13 4Q13
  20. 20. EBITDA US$ Million 14.4% 11.1% 11.4% 16.1% 13.8% 9.6% 1,004 891 609 611 2010 2011 2012 2013 557 2009 857 EBITDA EBITDA Margin Excluding AMR effect 2013 Outlook: 20 EBITDA: US$ 770 – 900 Million EBITDA Margin: 13.0% – 14.0%
  21. 21. EBITDA EBITDA - US$ Million EBITDA - R$ Million 2013: 2,239 / 16.4% 2013: 1,004 / 16.1% 23.7% 23.6% 17.3% 16.3% 13.1% 17.2% 16.3% 13.2% 12.1% 9.2% 12.2% 9.3% 544 909 397 638 310 204 100 4Q12 1Q13 2Q13 427 156 3Q13 359 2Q13 3Q13 201 4Q13 4Q12 1Q13 EBITDA EBITDA Margin Excluding AMR effect 21 1,253 4Q13
  22. 22. Net Income US$ Million 8.5% 6.2% 5.6% 5.5% 348 342 2012 2013 1.9% 465 330 112 2009 2010 Net Income 22 2011 Net Margin
  23. 23. Net Income Net Income - US$ Million Net Income - R$ Million 2013: 342 / 5.5% 2013: 778 / 5.7% 11.5% 6.5% 11.5% 6.5% 4.1% 2.8% 4.0% 2.9% -0.3% -0.3% 607 265 123 254 53 30 4Q12 1Q13 (5) 2Q13 3Q13 4Q13 Net Income 23 119 62 4Q12 1Q13 Net Margin (10) 2Q13 3Q13 4Q13
  24. 24. EPADS and Pay Out US$ 116% 26% 34% 26% 26% 2.57 1.92 1.83 1.88 2012 2013 0.62 2009 2010 2011 EPADS 24 Pay Out
  25. 25. Inventories US$ Million 2,445 2,198 2009 25 2010 2,288 2011 2,157 2012 2,287 2013
  26. 26. Free Cash Flow 2013: 213 US$ Million 761 496 438 201 186 102 2 (163) (75) 4Q12 (83) (50) (68) (125) (60) (106) (84) (80) 2Q13 3Q13 (109) (201) 1Q13 4Q12 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 26 (156) 438 (163) (75) 201 1Q13 (83) (50) (68) (201) 4Q13 2Q13 186 (125) (60) 2 3Q13 4Q13 2013 102 (106) (80) 761 (156) (109) 967 (438) (317) (84) 496 213
  27. 27. Investments US$ Million Total Investments 534 300 265 193 75 100 RESEARCH DEVELOPMENT 2013 CAPEX 2013 Outlook 2013 Outlook: US$ 580 Million 27 180 580
  28. 28. Indebtedness Profile / Net Cash Indebtedness Maturity 16% 15% 5.8 5.1 84% 85% Net Cash/Debt - US$ Million 6.3 6% 4% 6.2 96% 96% 4% 5.4 94% 429 309 98 4Q12 1Q13 2Q13 3Q13 58 (20) 4Q13 4Q12 1Q13 2Q13 3Q13 4Q13 Long-term Short-term Loans Average Maturity (Years) Total Debt 4Q13 US$ 2.19 Billion 28 Total Cash 4Q13 US$ 2.62 Billion
  29. 29. 2014 OUTLOOK
  30. 30. 2014 Consolidated Outlook Net Revenues EBIT US$ 6.0 – 6.5 Billion US$ 540 – 620 Million EBIT Margin 9.0% – 9.5% EBITDA US$ 780 – 910 Million EBITDA Margin 13.0% – 14.0% Free Cash Flow Positive Low Double Digits 30
  31. 31. 2014 Business Units Outlook Deliveries: 92 to 97 E-jets Net Revenues US$ 3.20 – 3.40 Billion Deliveries: 80 to 90 light jets 25 to 30 large jets Net Revenues US$ 1.50 – 1.70 Billion Net Revenues Other Revenues 31 US$ 1.20 – 1.30 Billion US$ 100 Million
  32. 32. 2014 Investment Outlook Research US$ 80 Million Development US$ 320 Million CAPEX US$ 250 Million TOTAL INVESTMENTS: US$ 650 Million 32
  33. 33. Investor Relations Phone: +55 12 3927 4404 investor.relations@embraer.com.br www.embraer.com
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