Earnings release 2 q09 presentation


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Earnings release 2 q09 presentation

  1. 1. 2Q09 Presentation
  2. 2. Earnings Presentation Eduardo de Come (CFO and IRO) Marcos Leite (IR Manager)
  3. 3. Destaques do Período• CONCLUSION OF BRASIL ECODIESELS FINANCIAL RESTRUCTURING.• Conclusion of the 1st Capital Increase in the total amount of R$104 million, of which R$59 million corresponds to the conversion of debt and R$45 million to fresh money.• Announcement of 2nd Capital Increase, expected to expire on August 07, 2009, in the minimum amount of R$118 million and maximum amount of R$408 million, of which R$106 million will correspond to the conversion of debt into stock.• Restructuring of the method for amortizing R$78 million of the non-converted debt, with maturity in 48 months and payment from July 2010, at a cost of 120% of the CDI rate.• New contracts for the delivery of 57,000 m3 of biodiesel in 3Q09, in 4 plants.• Sales of 19,300 m3 in 2Q09, 12,700 m3 of which in June, following the rebuilding of working capital, which enabled the Company to resume normal operations.• Net Revenue of R$52.2 million, Gross Profit of R$13.9 million, and Gross Margin of 26.6%.• Adjusted EBITDA of R$1.9 million negative and Net Profit of R$21.7 million on the 2Q09. In June, Adjusted EBITDA of R$2.4 million and Net Profit of R$1.4 million.
  4. 4. Operational Performance Volume slightly higher than 1Q09 and 2Q08, with 66% of the revenues in june, when the company recouped its working capital ,allowing to operate in normal conditions. Biodiesel Floriano Crateús Iraquara Porto Nacional Rosário do Sul Itaquí Total 2T08 1.084,41 299,36 5.842,40 470,21 6.945,50 4.276,45 18.918,32 Sales of B100 1T09 3.683,14 6.917,90 0,00 6.649,70 1.117,20 0,00 18.367,95 (m3) 2T09 114,33 0,00 4.502,23 127,80 10.616,55 3.904,81 19.265,71 2T08 3.289,24 1.105,59 15.714,05 982,08 14.583,47 12.111,03 47.785,46 Revenues of 1T09 10.072,97 18.819,95 0,00 18.090,58 3.386,51 0,00 50.370,01 B100 (R$ ths) 2T09 246,85 0,00 11.434,57 275,93 26.959,87 9.916,30 48.833,52
  5. 5. Operational Performance Income Statement 2Q08 1Q09 2Q09 Jun/08 Jun/09 Net Revenue 44,985 42,620 52,198 11,597 38,342 COGS (58,992) (38,978) (38,312) (15,360) (24,578) Gross Profit (Loss) (14,007) 3,642 13,886 (3,763) 13,764 Net Profit (Loss) (83,944) (27,416) 21,740 (52,460) 1,418
  6. 6. Operational Performance Adjusted EBITDA: to represent more accurately the specific results in the periods, we present below the Company’s adjusted EBITDA, highlighting the results in June, which we consider a base month. 2Q08 1Q09 2Q09 Jun/08 Jun/09 Net Profit (Loss) of the period (83.944) (27.416) 21.740 (52.460) 1.418 Depreciation and Amortization 4.490 5.227 5.227 1.521 1.666 Financial Results 12831 12.829 11.517 5.424 6.204 Penalties – Petrobrás 19.797 19.797 Provisions 17.890 3.416 1.262 17.890 2.857 Tax benefits (11.022) (11.022) Revenues from Use of Rights contract (36.383) Other 3.816 5.692 857 1.295 Adjusted EBITDA (25.120) (5.944) (1.966) (6.972) 2.418
  7. 7. Operational Performance Gross revenue in 2Q09 was R$49.6 million, of which 98.4%, or R$48.8 million, was derived from the sale of 19,300 m³ of biodiesel. 250.000 200.000 Outros 150.000 Resíduos Glicerina 100.000 Mamona Girassol Biodiesel B100 50.000 0 1T08 2T08 3T08 4T08 1T09 2T09
  8. 8. Operational Performance In 2Q09, we recognized in our Deductions tax incentives that we had been booking under liabilities, since we needed to comply with certain conditions in order to book them under profit. As a result, total deductions in 2Q09 represented revenue of R$2.5 million. Without the effect of the tax benefits, we would have a deduction of R$8.5 million, representing 17% of the Gross Revenues. Net Revenues: With the recognition of the tax credits of around R$11 million described above, Net Revenue was R$52.2 million in 2Q09, 22% and 14% higher than in 1Q09 and 2Q08, respectively.
  9. 9. Operational Performance Cost of Goods Sold of R$ 38.3 million in the 2% 1% 3% 2Q09. Óleo vegetal remains the main item in our 11% production costs, and represents, together with methanol 94% of the cost of biodiesel sold, keeping the same proportion observed in 2008. Vegetable oil increased its share of costs, mainly due to the reduction in the costs of methanol, 83% another main input, given that the remaining components of COGS maintained practically same Óleo Vegetal Matéria Prima Mão de Obra GGF Depreciação proportion observed in previous quarters. Gross Profit reached R$13.9 million, representing 26.6% of the Net Revenues.
  10. 10. Operational Performance General and Administrative Expenses of R$ 9.1 milhões in the 2TQ9. Reduction of 33% in General and Administrative Expensas related to 2Q08. It remained in the same level of 1Q09. Eliminating non-recurring expenses would lead the G&A to R$ 7.9 million in the quarter, representing a reduction of 13.3% related to 1Q09 and 42.2% related to 2Q08. 16.000 13.715 14.000 12.000 11.090 10.509 9.153 10.000 9.003 9.100 7.932 8.000 6.000 4.000 2.000 0 1T08 2T08 3T08 4T08 1T09 2T09 2T09* Despesas Gerais e Administrativas
  11. 11. Operational Performance Other Operating Revenue: In 2Q09, Other Operating Revenue totaled R$28.7 million, net. We recorded revenue of R$37.2 million related to the rescission of the contract assigning the right to use our industrial capacity, which was recognized under long-term liabilities. This contract was rescinded in April 2009, with an accounting effect from the write-off of a liability of some R$36.3 million, which represents the difference between the revenue recognized and the fine of R$0.9 million paid due to the rescission of the contract, with a positive impact on the Company’s Shareholders’ Equity. We booked an expense of R$1.3 million related to the provisions for the adjustment of inventories to market value and for doubtful accounts.
  12. 12. Operational Performance We posted a Net Financial Expense of R$11.5 million in the quarter, arising primarily from interest charges on loans. We recorded Financial Expenses of R$15.4 million and Financial Income of R$3.9 million, this latter mainly due to the foreign exchange gains from loans denominated in U.S. dollar, which was converted into stock under the 1st Capital Increase. We expect our financial expenses to remain significantly below recent figures, following the conclusion of the conversion of debt under the 2nd Capital Increase and the restructuring of the remaining debt, the bulk of which has a cost of 120% of the CDI overnight rate.
  13. 13. Indebtedness Following the conclusion of the 1st Capital Increase, Brasil Ecodiesel reduced its net debt toR$227.1 million, due to the conversion of credits into stock as well as to the amortization of workingcapital loans. Indebtedness (in R$ thsl) 1Q09 2Q09 Short-Term 120,106 92,543 (+) Long – Term 177,991 136,912 (=) Total Indebtedness 298,097 229,455 (-) Cash and Equivalents 7,416 2,321 (=) Net Debt 290,681 227,134
  14. 14. Indebtedness We present below the Company’s debt situation considering the conclusion of the debtconversions currently in progress, which in not reflected in the 2Q09 balance sheet yet. In additionto lower level of debt, we also consider the new debt maturities in the long term, with an effectivelengthening of the debt profile. 229,455 92,543 123,178 44,532 136,912 78,646 2Q09 After Capital Increase Long Term Short Term
  15. 15. Investor Relations Eduardo de Come CFO and IRO Marcos Leite IR Manager Tel: +55 (21) 2546-5031 Website: www.brasilecodiesel.com.br/ri
  16. 16. Disclaimer• The estimates and forward-looking statements contained in this presentation are based in large part on current expectations and estimates of future events and trends that affect or could potentially affect the business, financial situation, operational results and prospects of BRASIL ECODIESEL. These estimates and statements are subject to various risks, uncertainties and assumptions and are based on the information currently available to BRASIL ECODIESEL. This presentation is also available on the website www.brasilecodiesel.com.br/ri.• These estimates involve risks and uncertainties and do not constitute a guarantee of future performance, since actual results or developments may differ substantially form the assumptions described in the estimates and forward-looking statements. In view of the risks and uncertainties involved, the estimates and forward-looking statements in this presentation may not occur and the future results and performance of BRASIL ECODIESEL may differ substantially from those envisaged by the estimates of BRASIL ECODIESEL. Given these uncertainties, investors should not base any investment decision on these estimates and forward-looking statements.• The words “believe”, "can”, “could”, “estimate”, “continue”, “anticipate”, “plan”, “expect” and similar expressions seek to identify estimates. These estimates refer only to the date on which they were expressed, and BRASIL ECODIESEL is not responsible for updating or revising any of these estimates in light of the occurrence of new information, future events or any other factors.• This presentation does not constitute an offer, invitation or solicitation to subscribe to or acquire any securities, and this presentation or any information contained herein does not constitute the basis of an agreement or commitment of any kind.