Uploaded on

 

  • Full Name Full Name Comment goes here.
    Are you sure you want to
    Your message goes here
    Be the first to comment
    Be the first to like this
No Downloads

Views

Total Views
749
On Slideshare
0
From Embeds
0
Number of Embeds
0

Actions

Shares
Downloads
10
Comments
0
Likes
0

Embeds 0

No embeds

Report content

Flagged as inappropriate Flag as inappropriate
Flag as inappropriate

Select your reason for flagging this presentation as inappropriate.

Cancel
    No notes for slide

Transcript

  • 1. 3Q11 Results Presentation November 10 2011 10, invest@tam.com.br www.tam.com.br/ir1
  • 2. Warning - Information and Projection g j 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 Company s investment operations or decisions taken based on information contained in this communication. These estimates are subject to changes without prior notice. This material has been prepared by TAM S.A. ( p p y (“TAM“ or the “Company”) includes certain forward- p y) 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 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 objectives, financial situation or particular needs of any recipient. No representation or warranty, 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.2
  • 3. Agenda g Highlights Financial Results Guidance and Fleet Plan3
  • 4. Achievements of our business units• New positioning and anew visual identity •15th anniversary•23 collision partners•Joint venture with AIMIA • New terminal at Maceio • New Executive Director •R Renewal of C l f Canadian di • 13th anniversary authority certification • 120 stores in Brazil
  • 5. We continue to study a p y potential investment in Trip p Fact •Signature of a non-binding agreement to Signat re non binding acquire 31% of the total capital of TRIP •Capture market growth •More significant exposure in the medium More density routes market •Due diligence process completed and satisfactory Partnership Expansion •We increased the number of code-share flights from 120 to 211 (76% increase) •The number of cities served increased from 60 to 72. •We observed an increase of over 110% in the volume of passengers transported via code- share. Next Steps •Analysis of business plan and valuation
  • 6. LATAM Airlines Group: Next Steps p p Antitrust Approvals: Next Steps: • Germany (July 2011) • Filings (SEC,CVM,SVS) • Italy (August 2011) • Chilean TDLC (September 2011) •Shareholders meetings • Spain (October 2011) •Exchange Offer & Closing (end of 1Q12) •Brazil •SEAE (August 2011) •SDE (August 2011) •CADE (pending)6
  • 7. We completed one year of our retail p j p y project Slide released in August 2010 • 120 TAM Vacations Stores • 3 sales points in subway stations Achievements • 10 kiosks at Casas Bahia •Load factor at the "off peak" hours increased considerably Load Factor X Hour* 3Q10 3Q11 -4 p.p. -8 p.p. 3Q11 3Q10 Average of the Quarters* Domestic flights at weekdays7
  • 8. Agenda g Highlights Financial Results Guidance and Fleet Plan8
  • 9. Multiplus Highlights p g g Operating highlights Item 3Q11 YoY QoY Points issued 20.0 bln +38.5% +7.9% Points redeemed 12.5 bln +171.7% +14.7% Breakage rate 24.0% +140bps +70bps Financial highlights Item 3Q11 YoY QoY Gross Billings of points R$ 397.3 mln +32.4% +12.1% Net Revenue R$ 321.5 mln +147.3% +12.8% EBITDA R$ 78.1 mln +64.5% -14.6% (margin of 24.3%) Adjusted EBITDA R$ 82.3 mln -7.0% +1.3% (margin of 22.2%) Net Income R$ 51.3 mln +15.3% -36.8% (margin of 16.0%)9
  • 10. Multiplus and Aimia signed a joint venture to explore thepotential of the Brazilian market 50% Joint Venture 50% Groupe Aeroplan •More than 30 million active members in the Aeroplan •8.9 million members program, Nectar and Air Miles Middle East •168 partners of which 23 are coalition •Hundreds of partners and some of the world’s top brands •Annual revenues of over $ 1.4 billion •Annual revenues of over $ 2 billions Annual • More than 100 employees in Brazil •Over 3,800 employees in the world New Company Design, development, management, and value creation from data analysis y It will be a loyalty marketing and insight for third party services company loyalty and incentive programs
  • 11. Domestic yield increased 2% compared to 3Q10 and 7% compared to 2Q11 Domestic Passengers ASK, RPK and Load Factor Passenger Revenue - R$ Million 8% 6% ASK 11,310 11,956 2% 12,232 6% 4% 1,466 1,472 1,561 RPK 8,269 -1% 8,227 7,897 Load 3Q10 2Q11 3Q11 3Q10 2Q11 3Q11 Factor 70% 69% 67% Yield - R$ Cents RASK - R$ Cents 1% 2% 4% 7% 12.3 11.7 12.1 18.6 17.8 19.0 3Q10 2Q11 3Q11 3Q10 * 2Q11 3Q11 * Adjusted11
  • 12. International passenger revenue increased 21% in dollar p g International Passengers ASK, RPK and Load Factor Passenger Revenue - Million 9% 13% ASK R$1,025 7,519 4% 7,820 7,184 R$903 $ R$865 18% 10% 21% RPK 6,541 6,123 7% 5,945 U$516 U$541 15% U$625 Load 3Q10 2Q11 3Q11 3Q10 2Q11 3Q11 Factor 83% 81% 84% Yield - Cents RASK - Cents 3% 4% R$12.6 R$13.1 R$ 15.2 $ R$ 15.7 R$11.5 R$ 14 1 11% 14.1 Avg US Dollar 14% -6% 10% 11% 3% U$8.0 8% U$ 9.6 $ U$7.2 $ U$7.2 11% $ 1.75 U$ 8 7 8.7 U$ 8 9 8.9 1.60 1.64 3Q10 2Q11 3Q11 3Q10 2Q11 3Q11 3Q10 2Q11 3Q1112
  • 13. At TAM S/A the EBIT margin was 16.7% g In Reais 3Q11 3Q10** 3Q11 vs 2Q11 3Q11 vs 3Q10 2Q11 Net Revenue (million) 3,319 2,899 13.0% 3,053 8.7% Operating Expenses (million) 2,766 2,258 22,5% 3,038 -8.9% EBIT ( illi ) (million) 553 681 -18 7% 18.7% 15,6 15 6 - EBIT Margin 16.7% 23.2% -6.5 p.p. 0.5% 16.2p.p. EBITDAR (million) 852 975 -12.6% 380 124% EBITDAR Margin 25.7% 2 % 33.2% 33 2% -7.5 p.p. 12.5% 13 2 -13.2p.p. Financ. Result + Others* (million) (1.288) 458 - 158 - Net Results (million) (620) 733 - 60 - Total RASK (cents) 16.6 15.9 4.2% 15.7 5.6% CASK (cents) 13.8 12.2 13.0 15.6 11.6% CASK ex fuel (cents) ex-fuel 9.7 97 7.5 75 30.2% 30 2% 10.0 10 0 2.9% 2 9% CASK USD (cents) 8.4 7.0 20.7% 9.8 13.8% CASK USD ex-fuel (cents) 5.9 4.3 39.1% 6.3 5.3% *Others includes “Movements in fair value of fuel derivatives” and “Gains (losses) on aircraft revaluation ** Numbers for 2010 were impacted by the Additional Tariff reversal, which significantly reduced the Companys operating costs.13
  • 14. ... however, we had a credit of PIS and COFINS that generated gains of R$ 426 million in the 3Q11 According to the tax rules we can recognize credit considering the proportion between revenue rules, subject to the cumulative and to the non-cumulative regime Recognized credit in the 3Q11 R$ Million 24 recurring* Through evolution of the g interpretation of the law, we revised the criteria used 402 non-recurring in determining credits, also in respect to international passenger revenue. Crédito Credit * Recurring value estimated per quarter14
  • 15. Excluding non-recurring impacts, TAM S.A EBIT margin was 5 8% 5.8% In Reais 3Q11 3Q10 3Q11 vs 3Q10 Net Revenue (million) 3,319 2,899 14.5% Operating Expenses (million) 3,127 2,623 19.2% EBIT (million) 192 276 -30.2% EBIT margin 5.8% 9.5% -3.7p.p. EBITDAR (million) 491 570 -13.9% -13 9% EBITDAR margin 14.8% 19.7% -4.9p.p. Total RASK (cents) 16.6 15.7 5.6% CASK (cents) 15.6 14.2 10.0% CASK ex-fuel (cents) 9.7 9.5 3.1% CASK USD (cents) ( ) 9.5 8.1 17.5% CASK USD ex-fuel (cents) 6.0 5.4 10.2% Numbers in this slide exclude the non-recurring credit of PIS and COFINS and tariffs payments to Infraero regarding the previous year in 3Q11 and in 3Q10 excludes the additional tariff reversal15
  • 16. Liquidity and debt p q y profile Adequate debt profile Liquidity Position R$ Milli Million 3,000 2,700 2,607 2,568 2,500 2,453 2,400 2,145 2,126 2,100 2,000 1,914 1 800 1,800 1,500 1,500 995 1,000 1,200 500 900 600 0 2005 2006 2007 2008 2009 2010 3Q11 300 0 Cash 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 6.0 5.6 10% 4.6 4.0 3.8 38 3.8 38 2.1 2.0 90% US$ 0.0 00 2005 2006 2007 2008 2009 2010 3Q11 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 200716
  • 17. WTI Hedge g We understand that our coverage level and price contracts are appropriate to business needs and market reality b i d d k t lit According to our hedging policy, defined by the risk committee17
  • 18. Agenda g Highlights Financial Result Guidance and Fleet Plan18
  • 19. 2011 Guidance Guidance for Actual 2011 Jan-Sep Domestic Market Demand growth (RPK) 15% - 18% 19% Supply growth (ASK) 10% - 13% 12% Domestic 10% - 14% 12% International 10% 12% Load Factor 73% - 75% 74% Domestic 67.5% - 70% 69% International 83% 82% New international frequency or destination 2 3 CASK ex-fuel ex fuel -5% 5% -1.5% 1 5% Average WTI USD 93 USD 95* Assumptions R$ 1.78 1.65* Average US dollar rate Average WTI in R$ R$ 166 R$ 154* * accumulated until October 201119
  • 20. We remain focused on reducing costs and we have several action plans Sales and Operations O ti Overhead O h d Marketing Review of commissioning Management and control Frequent revisions in the model and incentive paid to optimization of the aircraft organizational structure agencies maintenance and components Renegotiation of contracts Marketing investments with third parties focused on retail Review of GSE model Optimization of the antifraud Process improvement at credit card system airports reducing the cost of damage and loss of luggage Suitability of our network to our operation Several actions to reduce fuel consumption20
  • 21. We adjusted our network j Network redesign Replacement of A340 by changing more than A330 on the route 30% of flights São Paulo - Milan Second daily flight Improved connectivity between São Paulo for passengers and Orlando and new flight to Mexico City Domestic International Market Market Adjustments in the Optimization of aircraft frequencies to Paris, utilization Frankfurt and London Estimated annualized Focus on profitability gains of USD50 million21
  • 22. Focused on profitability and cash generation, we revised our fleet plan Former Fleet Plan Revised Fleet Plan 182 179 174 171 163 168 164 156 156 159 36 36 34 34 32 32 32 29 29 32 -3 -3 -4 4 -4 140 146 143 131 136 132 137 127 127 127 2011 2012 2013 2014 2015 2011 2012 2013 2014 2015 Narrow Body Wide Body Variation22
  • 23. invest@tam.com.br23 www.tam.com.br/ir