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110810   webconference ingles - 2 t11 ss
 

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    110810   webconference ingles - 2 t11 ss 110810 webconference ingles - 2 t11 ss Presentation Transcript

    • 2Q11 Results Presentation August 10, 2011 A t 10 invest@tam.com.br www.tam.com.br/ir1
    • Warning - Information and Projection This notice may contain estimates for future events. These estimates merely reflect the expectations of the Company’s management, and involve risks and uncertainties. The Company is not responsible for investment operations or decisions taken based on information contained in this communication. These estimates are subject to changes without p j g prior notice. This material has been prepared by TAM S.A. (“TAM“ or the “Company”) includes certain forward- looking statements that are based principally on TAM’s current expectations and on projections of future events and financial trends that currently affect or might affect TAM s business and are not guarantees TAM’s business, of future performance. They are based on management’s expectations that involve a number of business risks and uncertainties, any of each could cause actual financial condition and results of operations to differ materially from those set out in TAM’s forward-looking statements. TAM undertakes no obligation to publicly update or revise any forward looking statements. This material is published solely for informational purposes and is not to be construed as a solicitation or an offer to buy or sell any securities or related financial instruments. Likewise it does not give and should not be treated as giving investment advice. It has no regard to the specific investment objec es, a c a situation or particular eeds of any ec p e objectives, financial s ua o o pa cu a needs o a y recipient. No representation o warranty, e e o ep ese a o or a a y, either express or implied, is provided in relation to the accuracy, completeness or reliability of the information contained herein. It should not be regarded by recipients as a substitute for the exercise of their own judgment. judgment2
    • Agenda Highlights Airline Industry Financial Results Guidance and Fleet Plan3
    • We have completed 35 years of a successful history4
    • During these 35 years we have diversified our sources of revenue North Domestic America Europe South America5
    • Achievements of our business unitsAwards and Recognition Fleet and Network Highlights•Best Airline • Replacement of ATR by A319 • Award for best company in the•Excellence in Service • New flight: Guarulhos - Campo logistics segment•Operation Excellence•Best Airline Company Grande G d•Most Beloved Company • Flight linking the cities of • Highest quarterly revenue of our• Libano Miranda Barroso: Riberão Preto, Guarulhos and history: R$ 297 millionBrazilian Personality of the Year GaleãoNew Partnerships Expansion Achievement• Ofertas com br and GROUPON Ofertas.com.br •50 ship set o erha ls 50 ship-set overhauls • Opening of the 100th store (July)Capillarity Project • EASA certification for Line • Expectation to end the year with• Pilot at 2 restaurants (Japengo) 200 units Maintenance• 3Q11 - 50 merchants in São Paulo • Agreement with Caixa • Focus• 4Q11 - at least 350 merchants in Econômica Federal • New direct subordination to the Brazil holding company TAM S/A
    • We continue to study a potential investment in Trip Fact •Signature of a non-binding agreement to acquire 31% of the total capital of TRIP •Capture market growth Capture •More significant exposure in the medium density routes market Status •Due diligence process completed and satisfactory ti f t •Implementation of a new technological platform completed in early August Next Steps •Change in the code share agreement from g g "Block Space" to "Free Sale“ •Analysis of results with the new agreement* Implementation of the new technology platform, by Trip, was necessary for the change of the code share agreement.
    • Status of TAM & LAN combination Approvals & R i t ti A l Registrations: •TDLC (Chile) approval August 13, •Approval of antitrust authorities in Spain 2010: March 1, 2011: , (required) and Germany (approved) We announced ANAC approved •Approval of antitrust authorities in Brazil, the intetion to the proposed •Italy and Argentina (non suspensive) combine with corporate •CVM (Brazil), SVS (Chile), SEC (USA) LAN structure LATAM January 18 2011: 18, May 26 2011: 26, Shareholders Shareholders’ Exchange LAN and TAM signed Public Hearing Meetings Offer & binding agreements LAN, TAM and Closing interested parties will give their opinion about the transaction to the TDLC Court.8
    • Agenda Highlights Airline Industry Financial Results Guidance and Fleet Plan9
    • Latin American countries have a great growth potentialgrowth Trips* per capita - 2009 10 Bahamas Seychelles Malta M lt Cyprus Macao Iceland Maldives New Zealand UAE Ireland Barbados Singapore Australia St Lucia Hong Kong Bahrain Spain USA Denmark Canada UK Trinidad Greece Kuwait Finland Switzerland Qatar Fiji Puerto Rico Italy Sweden 1 Samoa Mauritius Latvia Oman Taiwan South Korea Brunei France Germany Austria Cape Verde Saudi Arabia Belgium Japan J Netherlands Estonia Costa Rica Chile Czech Rep. Israel Jordan Libya Slovenia Hungary Bolivia Slovakia Mongolia Uruguay 0,1 01 Equatorial Guinea Senegal Belarus Angola World average Liberia Swaziland Bangladesh Brazil Lesotho 0,01 Iraq Chad 0,001 0 5.000 10.000 15.000 20.000 25.000 30.000 35.000 40.000 45.000 50.000 55.000 2009 real GDP per capita in USD * Passengers originating from respective country Source: Airbus
    • Domestic passengers revenue increased by 3% Domestic Passengers ASK, RPK and Load Factor Passenger Revenue - R$ Million 15% ASK 11,767 11,956 3% 10,357 2% 3% 31% 8,288 8,269 1,428 1,511 1 511 1,472 RPK 6,335 0% Load 2Q10 1Q11 2Q11 2Q10 1Q11 2Q11 Factor 61% 70% 69% Yield - R$ Cents RASK - R$ Cents 10% 21% 5% 2% 22.5 13.0 12.3 11.7 18.2 17.8 2Q10 1Q11 2Q11 2Q10 1Q11 2Q1111
    • We reduced the gap between peak and off peak hours We W remain f i focused on offering d ff i affordable ticket to price-sensitive passengers Load factor X Hour Peak Off Peak Peak 2Q10 2Q1112
    • International passenger revenue increased 32% in dollar International Passengers ASK, RPK and Load Factor Passenger Revenue - Million 18% 14% R$862 $ R$865 $ 0% ASK 3% 7,519 R$732 7,334 6,621 32% 21% 5% RPK 5,838 5% 6,123 U$541 U$517 5,055 U$409 Load 2Q10 1Q11 2Q11 2Q10 1Q11 2Q11 Factor 76% 80% 81% Yield - Cents RASK - Cents R$ 14.5 R$ 14.8 R$ 14.1 R$11.7 R$11.5 2% R$11.1 4% 4% Avg US Dollar 2% -11% 10% -4% 17% U$ 8.1 U$ 8.9 U$ 8.9 U$7.0 U$7.2 1.79 1.67 1.60 U$6.2 2% 0% 2Q10 1Q11 2Q11 2Q10 1Q11 2Q11 2Q10 1Q11 2Q1113
    • Agenda Highlights Airline Indusry Financial Results Guidance and Fleet Plan14
    • Multiplus continues to consolidate as an importantsource of profitability f fit bilit FINANCIAL HIGHLIGHTS• Gross Billings of points of R$ 355 million, a growth of 34% versus 2Q10 and of 4.3% compared to 1Q11• Net Revenue of R$ 285 N tR f million, compared t R$ 93 million iin 2Q10 and R$ 242 million iin 1Q11 d to illi d illi• Net Income of R$ 81 million, versus R$ 23 million in the 2Q10 and R$ 71 million in 1Q11 (margin of 28.5%)• Cash Generation of R$ 331 million, 8.7% higher than 2Q10 and 29% than 1Q11 NET REVENUE NET INCOMER$ million R$ miIlion +205.0% 205.0% +250.9% % +14.5% +17.8% 285 81 242 71 206 Margem g 130 45 43 94 23 24.7% 34.2% 21.0% 29.3% 28.5% 2T10 3T10 4T10 1T11 2T11 2Q10 3Q10 4Q10 1Q11 2Q11
    • At TAM S/A the EBITAR increased by 8% In Reais 2Q11 2Q10 2Q11 vs 1Q11 2Q11 vs 2Q10 1Q11 Net Revenue (million) 3,053 2,611 16.9% 3,043 0.4% Operating Expenses (million) p g p ( ) 3,038 , 2,610 , 16.4% 2,932 , 3,.% , EBIT (million) 15.6 1.4 - 110 -85.8% EBIT Margin 0.5% 0.1% 0.5p.p. 3.6% -3.1p.p. EBITDAR (million) 313 289 8.2% 380 -17.8% EBITDAR Margin 10.2% 11.1% -0.8p.p. 12.5% -2.3p.p. Financ. Financ Result + Others ( illi ) 160 Others* (million) (211) - 140 13.8% 13 8% Net Income (million) 60 (176) - 129 -53.2% Total RASK (cents) 15.7 15.4 1.9% 15.9 -1.6% CASK (cents) 15.6 15.4 1.5% 15.4 1.6% CASK ex-fuel (cents) 10.0 10.4 -3.5% 9.8 2.1% CASK USD (cents) 9.8 8.6 13.9% 9.2 6.2% CASK USD ex-fuel (cents) 6.3 5.8 8.4% 5.9 6.7% * Others includes “Movements in fair value of fuel derivatives” and “Gains (losses) on aircraft revaluation”16
    • Liquidity and debt profile Adequate debt profile Senior Notes Issuance R$ Million Details Use of Proceeds 2,700 2,400 • USD 500 million • payment of maturing debt 2,100 1,800 •Due to 2021 • pre-delivery payments 1,500 •Semiannual payments • general corporate purposes 1,200 •Interest rate of 8 375% 8,375% 900 600 300 0 Caixa 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 Adjusted Net Debt / EBITDAR Leasing on the balance sheet Debentures, bonds and others 8.0 Debt mix by currency R$ $ 6.3 6.5 65 6.0 5.6 14% 4.0 3.8 3.8 3.7 2.1 2.0 86% US$ 0.0 2005 2006 2007 2008 2009 2010 2Q11 Obs.1: Net Debt Adjusted includes annual operating leases x 7 Obs.2: Debt is considered in US GAAP for 2005 and 2006 and in IFRS since 200717
    • WTI Hedge We understand that our coverage level and price contracts are appropriate to business needs and market reality 70% USD 150  60% USD 130  50% Cove rage Level USD 110  ke Prices 40% Stik 30% USD 90  20% USD 70  USD 70 10% 0% USD 50  1S 2S 3S 4S 5S 6S Minimum Maximum Current Position Average Strike According to our hedging policy, defined by the risk committee
    • Agenda Highlights Airline Industry Financial Result Guidance and Fleet Plan19
    • 2011 Guidance Guidance for Actual 2011 Jan-Jun Jan Jun Domestic Market Demand growth (RPK) 15% - 18% 21% Supply growth (ASK) 10% - 13% 14% Domestic 10% - 14% 14% International 10% 13% Load Factor 73% - 75% 74% Domestic 67.5% - 70% 70% International 83% 81% New international frequency or destination 2 5 CASK ex-fuel -5% -3.6% Average WTI USD 93 USD 98* Assumptions Average US dollar rate R$ 1.78 1.62* Average WTI in R$ R$ 166 R$ 159 * Accumulated until July 30, 201120
    • Fleet Plan Total Fleet (end of period) 182 A340 -2 3 174 12 2 168 163 12 156 156 8 10 3 24 4 4 3 3 22 A330 19 21 20 20 A321- 9 9 A320 88 146 86 136 140 131 A319 3 9 27 30 5 2Q11 2011 2012 2013 2014 2015 B777 B767 Airbus wide-body Airbus narrow-body ATR-4221
    • invest@tam.com.br i @ b22 www.tam.com.br/ir