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4QO7 Results Conference Call Presentation
 

4QO7 Results Conference Call Presentation

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    4QO7 Results Conference Call Presentation 4QO7 Results Conference Call Presentation Presentation Transcript

    • Earnings Results 4Q07 March 25th,2008
    • Disclaimer This presentation contains forward-looking statements relating to the business outlook, operating and financial projections, and the growth prospects of Tempo Participações S.A. These statements merely represent projections and as such are based exclusively on Management’s expectations about the future of the business. Such forward-looking statements depend substantially on changes in market conditions, the performance of the Brazilian economy, the industry and international markets, and therefore are subject to change without prior notice. 2
    • ABOUT TEMPO PARTICIPAÇÕES
    • Business Units Healthcare Administration Dental HMO Assistance Services Services Ranking: #5 Ranking: #1 Ranking: #1 Number of lives: 457 thousand Number of items: 17.3 million Number of lives: 1.3 million Underwriting of frequency risk Underwriting of frequency risk No underwriting risk. Fee business only. 4
    • Commercial Sinergies and Common Operational Platform Clients Common Back-Office Administration Services Network of Service Providers State-of-the-art Proprietary IT Platform Corporate Clients Insurers Healthcare Network Management HMOs Network of Service Providers Corporate USERS Clients Dental HMO Contact Center B2B2C HMOs Network of Service Providers Assistance Services Insurers Claims Processing B2B2C 5
    • Tempo: A Powerful Combination of Organic Growth and M&A Tempo is a result of 10 successful acquisitions since its inception Acquisition of Acquisition of ConnectMed founded by Jose Medlar USS Bonchristiano. GP joins the Specialty Health Company in March with other Assistance institutional investors Acquisition Acquisition of Acquisition of Associl2 of Cloe Gama Saúde Dental Dental Health Admin 2000 2001 2002 2003 2004 2006 2007 Acquisition Acquisition of Acquisition of Acquisition of Odonto Empresa 2 of CRC Gama Odonto Oralgold Health Admin Dental Dental Dental Consolidation Expansion into new markets Acquisition of Observations: OralTech2 1 Subsidiary of Gama Saúde by the time of its Dental acquisition 2 Pending ANS approval 6
    • RECENT EVENTS
    • 12 months, 5 acquisitions... USS Acquisition Dec 06 Assistance Associl Acquisition– 75,000 lives May 07 Dental Med-Lar Acquisition Oct 07 Home Care Oraltech Acquisition – 30,000 lives Nov 07 Dental Odonto Empresa Acquisiton – 220,000 lives Nov 07 Dental Total Invested from Dec/06 to Dec/07 R$ 250,000,000.00 8
    • USS integrated in 6 months… Acquire First Contact 100% Integrated Closing July 07 August 06 December 06 Synergies Before Taxes – EBITDA Annual Impact Goodwill – Tansaction Value Impact 2.0 (R$ MM) 22.0 (R$ MM) 150.0 14.0 8.2 128.0 3.8 34.5 Head Count Fixed Costs Operational Total Asset Cost NPV - Taxshield Equity Goodwill Efficiencies Pre - Transaction Post Transaction Acquisition Cost R$ 150 MM R$ 115,5 MM EBITDA R$ 25 MM R$ 39 MM Multiple 6.0 x 2.96 x 9
    • IPO: Tempo in Novo Mercado Former Executives Management Brasil Warrant Free Float 28,5% 9,3% 7,0% 35,1% 20,1% P rice per S hare P rim ary O ffer S econdary O ffer Total IPO Price per Share R$ 7,00 Primary Offer 56.250.000 Shares Secondary Offer 3.720.800 Shares Total R$ 419.765.600,00 10
    • FINANCIAL AND OPERATIONAL PERFORMANCE
    • Tempo Participações - Consolidated (R$ MM) 4Q07 4Q06 Chg. % 2007 2006 Chg. % Net Revenues 168.1 132.5 26.9% 572.6 490.1 16.8% EBITDA 21.5 7.2 198.6% 55.0 37.6 46.3% EBITDA Margin 12.8% 5.4% 7,4 p.p. 9.6 p.p. 7.7% 1.9 p.p. 16.6 5.0 232.0 38.6 23.5 64.3% Net Earnings 9.9% 3.8% 6.1 p.p. 6.7% 4.8% 1.9 p.p.% Net Margin Net Revenue (R$ MM) EBITDA Margin EBITDA (R$ MM) EBITDA EBITDA Margin R$ MM 9.6% 55.0 7.7% 490.1 37.6 572.6 2006 2007 2006 2007 2006 2007 12
    • Health Plans- Gama Saúde Beneficiaries Beneficiaries - Health Plans Strong growth in number of lives even though there was 1,310,141 moderate growth in the private regulated health care market (approx. 5%) 1,061,233 730,385 427,890 2004 2005 2006 2007 Net Revenue(R$ MM) Net Revenue - Health Plans (R$ MM) Strong revenue growth supported by Net Revenue - Health Plans increase in the member´s base. 321.3 (R$ MM) 9.5 262.8 Strong fee growth in line with total revenue 214.5 102.8 increase. 9.5 154.2 73.3 250.3 211.2 173.4 74.6 124.0 59.8 61.5 51.6 41.1 18.7 30.2 13.5 2004 2005 2006 2007 4Q06 4Q07 Gross Profit/ Adm Tax Gross Profit/ Adm Tax Transfer of Medical Costs Home Care Gross Profit/ Adm Tax Home Care 13
    • Health Care- Gama Saúde General and Administrative General and Administrative Expenses R$ MM) (Excluding Non-Recurring Expenses) Expenses - Health Plans (R$ MM) General and Administrative Expenses - Health Plans (R$ MM) 18.5% 17.2% 17.2% 14.3% 13.3% 7.3% Operational efficiencies and 45.2 expenses dilution powered by 42.7 36.8 28.5 low cost structure. 10.5 7.5 2004 2005 2006 2007 4Q06 4Q07 General and Administrative Expenses % Net Revenue General and Administrative Expenses % Net Revenue Ajusted EBITDA (R$ MM) EBITDA - Health Plans EBITDA - Health Plans (R$ MM) (R$ MM) 7.0% Gama Saúde´s new clients 13.3% marginal margins are double the current business margin 3.4% 3.4% 3.2% 13.7 5.0% 22.5 8.9 7.3 3.7 5.0 2004 2005 2006 2007 4Q06 4Q07 EBITDA EBITDA Margin EBITDA EBITDA Margin 14
    • Dental- Gama Odonto Beneficiaries Number of lives covered in 2007 compared to 2006 due to 475.829 three important acquisitions. (Associl, Oraltech and Odonto Empresa). 335.336 Gama Odonto´s new growth strategy will allow organic growth above market levels (B2B2C). 140.493 130.646 124.434 103.313 2004 2005 2006 2007 Tempo Novas Aquisições Net Revenue(R$ MM) Net Revenue - Dental (R$ MM) Net Revenue - Dental Acquired companies in 2007 are not (R$ MM) incorporated in 2007 results. Net revenue considering pro-forma acquisitions would have totalled R$ 60 million in 2007.. 20.5 21.4 18.1 15.1 5.2 5.4 2004 2005 2006 2007 4Q06 4Q07 15
    • Dental- Gama Odonto General and Administrative Expenses Cost of Rendered Services* Despesas Gerais e Administrativas - Odonto (R$ MM) Despesas Gerais e Administrativas Odonto (R$ MM) 50.7% 41.7% 55.0% Cost of Rendered Services - 53.3% 49.7% 39.8% Dental (R$ MM) 35.1% 11.4 46.2% 33.2% 10.4 57.4% 32.7% 9.0 46.2% 8.3 7.2 7.2 7.1 2.4 6.3 2.4 3.7 1.7 2004 2005 2006 2007 4Q06 4Q07 4Q06 4Q07 2004 2005 2006 2007 General and Administrative Expenses General and Administrative Expenses Cost of Rendered Services Medical Loss Ratio Cost of Rendered Services % Net Revenue % Net Revenue Net costs of technical provisions Medical Loss Ratio EBITDA EBITDA - Dental (R$ MM) EBITDA - Dental 26.6% Medical Loss Ratio does not include acquisiitions, 22.9% 33.3% which will result in a reduction of this index in the 20.4% 15.9% next results. 5.7 4.7 15.4% 1.8 3.7 The fourth quarter of 2007 already reflects the 2.4 resulting sinergies of USS´s integration. 0.8 4Q06 4Q07 2004 2005 2006 2007 EBITDA EBITDA Margin EBITDA EBITDA Margin 16
    • Assistance Services- USS Items – In millions Items - Assistance Services (in million) 17.3 14.5 16.8 Growth recovery in the number of items covered 16.0 after after slight fall back in 2006. 2004 2005 2006 2007 Net Revenue Receita Líquida - Assistência Especializada (R$ MM) Receita Líquida - Assistência Especializada (R$ MM) Strong organic annual growht in the past 4 years driven by services with additonal added value. 229.9 59.9 206.8 54.0 178.7 151.0 4Q06 4Q07 2004 2005 2006 2007 17
    • Assistance Services- USS General and Administrative Expenses Cost of Rendered Services - Assistance Services of Rendered Services Cost (R$ MM) Despesas Gerais e Administrativas - Assistência Cost of Rendered Services Assistance Services (R$ MM) Especializada (R$ MM) 57.7% 54.1% 52.4% Despesas Gerais e 50.4% 39.3% 56.8% 38.9% 38.0% Administrativas - Assistência 52.4% 35.4% Especializada (R$ MM) 43.7% 34.2% 124.4 104.3 93.7 87.1 34.0 81.4 67.9 59.4 80.50 28.3 20.5 23.6 4T06 4T07 2004 2005 2006 2007 4Q06 4Q07 2004 2005 2006 2007 General and Administrative General and Administrative Expenses Cost of Rendered Services Cost of Rendered Services Medical Loss Ratio Expenses % of Net Revenue Medical Loss Ratio % of Net Revenue EBITDA EBITDA - Assistance Services EBITDA - Assistance Services (R$ MM) (R$ MM) 11.7% 11.6% Increase in the Loss Ratio is related to providing 10.0% 10.7% 5.0% services with additional added value . 24.0 6.0 26.8 4.4% 19.2 The fourth quarter of 2007 already reflects the 2.7 resulting sinergies of USS´s integration. 6.6 2004 2005 2006 2007 4Q06 4Q07 EBITDA EBITDA Margin EBITDA Margem EBITDA 18
    • Strong Cash Genereation and Financial Leverage Capex vs Ajusted Pro-Forma EBITDA (R$ mm) 55.0% 37.6% 30.2% 14.0% 5.1 4.3 4.0 2.5 2004 2005 2006 2007 Capex Ajusted EBITDA Capitalization (R$ mm) Goodwill Generation (R$ MM) Business Model Dez/ 07 Dez / 07 Asset Light Cash and Equivalent 404.2 Audited Goodwill 104.5 Short-Term Debt 1.5 Goodwill Generated by 49.2 Recent Acquisitions Long-Term Debt 55.5 Financial Solidity Total Goodwill 153.7 Total Debt 57 Fiscal Benefits to be 52.3 Net Debt (Cash) 347.2 Amortized in 5 years Strong Growth Capacity 19
    • IR Contacts Tel: +55 11 4208-8069 E-mail: ri@tempopar.com.br www.tempopar.com.br/ri