Estácio: UniSãoLuis´s Presentation - Mergers and Acquisitions
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Estácio: UniSãoLuis´s Presentation - Mergers and Acquisitions

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Estácio: UniSãoLuis´s Presentation - Mergers and Acquisitions

Estácio: UniSãoLuis´s Presentation - Mergers and Acquisitions

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  • 1. Faculdade São LuísExtraordinary Shareholders’ Meeting – Mergers and Acquisitions June 15, 2012
  • 2. Social and Economic Dynamics – São Luís São Luís is Maranhão’s main economic Total: R$15.3 billion center. Its expansion resulted from the installation of major economic projects, such Per capita income: R$15,381 as the Itaqui Port and the Ponta da Madeira 2009 GDP – Working-age population: 44% Port Complex (CPPM), in addition to the IBGE consolidation of the Industrial District. The Working population: 35% combination of these projects have vitalized the local economy. Unemployment rate: 22% Population 958 GDP Breakdown by Sector 942 6% 0.2% 928 945 14.4% 930 41.2% 919 94% 05 06 07 08 09 10 44.2% Brazil São Luís Agribusiness Industry Services Public Adm. Urban Rural > The broad base of São Luís’s pyramid projects future growth in the number of target people (“supply of students for post-secondary education”) 2000 IBGE Census 2
  • 3. Northeast Region Growth Low penetration of students enrolled in the Northeastern region points to high growth potential Penetration of students enrolled in the target population (aged between 18 and 35) Source: IPC Target / Estácio 3
  • 4. Growth and CompetitionIES Market – São Luís (thousand students) IES – Local Market 18.000 UNICEUMA 16.000 UFMA 14.000 FAMA Kroton 12.000 UEMA 33,3 35,0 10.000 24,2 25,2 27,5 29,2 FACSÃOLUÍS 8.000 CEST 15,3 15,7 15,0 15,5 19,5 19,6 6.000 Fac.Pitagoras 4.000 05 06 07 08 09 10* UNDB 2.000 FACAM-MA Total Públicas Total Privadas 0 2002 2003 2004 2005 2006 2007 2008 2009 2010 OutrosStudent Base – FACSÃOLUÍS Market Share 10,9% 10,6% 3.716 3.616 8,1% 7,8% 8,5% 7,2% 6,9% 6,8% 5,6% 1.963 1.977 2.484 5,0% 4,8% 4,7% 1.914 2.049 1.979 1.339 05 06 07 08 09 10* 02 03 04 05 06 07 08 09 10 Total Geral Total Privadas *latest information available 4
  • 5. Executive Summary The Company • Approximately 4,000 students in 2012 • CAGR 05-10 of 13.6% for Fac. São Luís vs. 7.1% for other private IES (post-secondary education) institutions • For-profit IES and ProUni • 1 campus located downtown São Luís • Average Net Ticket (2011): R$432 Strategic Rationale • Entry the São Luís market, expanding the portfolio of on-campus programs and transforming the institution into a distance learning (EAD) center • Excellent infrastructure • Synergies: Shared Services Center (CSC), teaching activities, marketing 5
  • 6. Valuation PremisesFinancial Operational• Nominal flow • Average Student Base: CAGR 2011-16 of 4.3%, which should increase as of 2014 due to the new courses approved (note: the• Average inflation: base excludes distance learning) 5.1%• WACC: 15% • Average Ticket: Pass through of projected inflation only.• Perpetuity Growth • Cost of Services: 10 p.p. gain in faculty costs by 2016, reflecting the (g): 4.5% implementation of the Estácio teaching model.• Base date: June 30, • SG&A: synergy gains from back office reduction and 13 p.p. 2012 reduction in the Administration payroll by 2016; 8 p.p reduction in PDA to 5% of net revenues • CAPEX: higher investments in 2012 and 2013 to cover IT and systems integration costs, and reduction to 3.5% of net revenues in 2014. 6
  • 7. Valuation 2011A 2012E 2013E 2014E 2015E 2016ER$ million CAGRAverage student base 3884 3,972 3,987 4,147 4,335 4,788 4.3%Base growth 2.3% 0.4% 4.0% 4.5% 10.4% • Base dateNet revenue 19.5 22.4 23.5 25.4 27.5 31.4 06/30/2012 Cost of services (7.0) (8,1) (8,0) (7,9) (7,9) (8,1)Gross profit 8.7 9.9 11.8 14.7 17.7 21.0 • 5-year flow:SG&A (12.3) (14.1) (11.8) (9.9) (8.8) (9.7) R$16.2 MEBITDA 0.2 0.3 3.7 7.6 10.9 13.5 (-) IR + CSLL (0.0) (0.0) (0.1) (0.1) (0.2) • Perpetuity: (+) VCG (1.0) (0.5) (0.5) (0.5) (0.6) R$65.7 M (-) CAPEX (2.3) (1.7) (0.9) (1.0) (1.1) Perp. ResultFree Cash Flow (3.0) 1.5 6.1 9.2 11.6 119.1 • Total EV:PV - Free Cash Flow (2.5) 1.3 4.6 6.1 6.7 65.7 R$ 81.9 M • Proposal: 2011A 2012E 2013E 2014E 2015E 2016E R$28 MNet revenue 100% 100% 100% 100% 100% 100% R$7,000/stud Cost of services -36.0% -36.0% -34.0% -31.3% -28.6% -25.9% entGross profit 44.4% 44.4% 50.1% 57.8% 64.3% 67.0% • IRR: 21.4%SG&A -62.8% -62.8% -50.3% -38.8% -31.9% -31.0%EBITDA Margin 1.2% 1.2% 15.7% 29.9% 39.5% 43.1% (-) CAPEX 0.0% -10.2% -7.1% -3.5% -3.5% -3.5% 7