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Company presentation

  1. 1. Company Presentation January 20111
  2. 2. Notice This presentation contains forward-looking statements relating to the prospects of the business, estimates for operating and financial results, and those related to growth prospects of OHL Brasil, these are merely projections and, as such, are based exclusively on the expectations of OHL Brasil’s management concerning the future of the business and its continued access to capital to fund the Company’s business plan. Such forward-looking statements depend, substantially, on changes in market conditions, government regulations, competitive pressures, the performance of the Brazilian economy and the industry and are, therefore, subject to change without prior notice.2
  3. 3. Agenda  Company Profile  Portfolio  Traffic  OHL Brasil’s Performance  Financing Plan  Analysts Coverage  New Opportunities3
  4. 4. Company Profile – OHL Group NATIONAL INTERNATIONAL CONCESSIONS ENVIRONMENTAL DEVELOPMENTS INDUSTRIAL CONSTRUCTION CONSTRUCTION • Civil Projects • USA • Buildings Construction • Mexico, Chile and Peru • Sea and brackish water • Tourist Complexes • Refinery Desalination • Urban Services and • Central Europe • Malls • Gas Infrastructures • Urban and Industrial • Qatar and Argelia • Petrochemical Water Purification • Potable water treatment • Energy • Lands Movements • Fire protection systems TOLL ROADS RAILWAYS COMMERCIAL AIRPORTS MARINAS PARKING FACILITIES PORTS •9 • 2 Spain • 1 Mexico • 4 Spain • 1 Brazil • 1 Spain 37 km 4 million 2,431 berths • 1 Argentina • 1 India pass./year • 3 Chile 80 hectares • 6 Mexico • 3 Spain • 1 Peru 4,414 km (1) PWF = Public Works Financing4
  5. 5. Company Profile – OHL Concesiones – Geographical Presence5
  6. 6. Company Profile – OHL Group OHL Group OHL Concesiones International Group of construction, concessions and  Strategic position in Latin America: Brazil, México and Chile; services, listed in the Madrid Stock Exchange since 1991;  Global operator of infrastructures: roads, ports, airports and Founded over 98 years ago and established in 21countries; railways; Portfolio of € 81 bn (3Q10);  Expertise in Brazil through OHL Brasil; Unique Spanish builder with financial rating (Ba1 / BB-).  Broad international experience in the developing of efficient capital structure for projects. Summary of results:  Summary of results: Revenue (Euros M) 2008 2009 9M10 Revenue (Euros M) 2008 2009 9M10 OHL S.A 4,009 100% 4,390 100% 3,343 100% OHL Concessiones 542 100% 743 100% 786 100% National Construction 1,786 45% 1,604 37% 937 28% Argentina 11 2% 10 1% 10 1% International Construction 1,429 36% 1,830 42% 1,401 42% Brazil 273 50% 432 58% 467 59% Others Activities 251 6% 213 5% 220 7% Chile 52 10% 59 8% 51 6% Concessions 542 14% 743 17% 786 24% Spain 44 8% 49 7% 55 7% Mexico 80 15% 65 9% 63 8% Other 84 15% 129 17% 140 18% EBITDA (Euros M) 2008 2009 9M10 OHL S.A 608 100% 747 100% 656 100% EBITDA (Euros M) 2008 2009 9M10 National Construction 121 20% 105 14% 61 9% OHL Concessiones 340 100% 456 100% 476 100% International Construction 111 18% 173 23% 113 17% Argentina 1 0% (3) -1% (2) 0% Others Activities 36 6% 13 2% 6 1% Brazil 205 60% 277 61% 305 64% Concessions 340 56% 456 61% 476 73% Chile 33 10% 40 9% 36 8% Spain 1 0% 26 6% 28 6% Mexico 118 35% 118 26% 127 27% Other (18) -5% (1) 0% (18) -4% 6
  7. 7. Company Profile – Investment Criteria  Geographical Scope:  Strategic Countries like Brazil, Mexico, Chile, Peru and Spain;  Selectively in other geographical areas.  Level of Ownership: We favor majority holdings that confer decision-taking and control powers in each concession.  Profitability: A 15% target in Euros, taking into account the effect of possible parity changes, estimated as inflation differential.  Equity: Financed with cash flow put up by the Group.  Debt: Non-recourse and in local currency, free from exchange rate risk.7
  8. 8. Company Profile – Corporate Structure 100.0% 100.0% Participes en Brasil S.L. SPAIN 60.0% BRAZIL 40.0% FEDERAL TOLL ROADS SAO PAULO STATE TOLL ROADS OTHER BUSINESS 100.0% 100.0% 100.0% 100.0% 100.0% SPR 4.68%8
  9. 9. Company Profile – OHL Brasil’s Concessions One of the largest company in Brazil in the sector of toll roads concessions in terms of kilometers under management, with 3,226 km OHL Brasil consolidated its participation in the main economic axes of the country There are approximately 35 million people living near our highways The states in which we operate hold more than 2/3 of the Brazilian fleet of vehicles 9
  10. 10. Company Profile – Terms of the Concessions  Portfolio Life: The average remaining term of our concessions’ portfolio is 17.5 years. 23 23 23 23 23 18 8 9 8 2 2 2 2 2 12 12 10 12 Years pending Years elapsed10
  11. 11. Portfolio – São Paulo State Concessions State Concessions State Concessions OHL Brasil Stake 100% Length 1,147 km No. of Toll Plazas 23 Portfolio Average Life 10.8 years Eqv. Vehicles – 3Q10 (mn) 42.4 Employees – 3Q10 1,276 Average Tariff – 3Q10 R$ 6.24 Invest. Estimated – (5 Years) R$ 598.0 million Net Debt – 3Q10 R$ 954.6 million Net revenue, margin and EBITDA – fixed c. charge paid 70.9%900 68.2% 67.7% 61.9% 64.0% 70,0%800 57.0% 59.4% 51.1% 60,0%700600 50,0%500 40,0%400 776 724 659 30,0%300 617 507 546 525 465 494 467 20,0%200 360 338 395 265 301 10,0%100 184 - 0,0% 2003 2004 2005 2006 2007 2008 2009 9M10 Net revenue (R$ mn) EBITDA Fixed c. charge (R$ mn) - EBITDA margin(%)11
  12. 12. Portfolio – Federal Concessions Federal Concessions Federal Concessions OHL Brasil Stake 100 % Length 2,079 km No. of toll plazas 29 Portfolio Average Life 23 years Employees – 3Q10 1,700 Average Tariff – 3Q10 R$ 1.51 Invest. Estimated – (5 Years) R$ 3,780 million Net Debt – 3Q10 R$ 672.3 million Net revenue, margin and EBITDA 44.2% 41.7% 42.6% 46.2% 41.4% 25.1% 40,0% 141 152 20,0%100 138 139 128 0,0% 100 48 53 61 58 60 70 -20,0% 25 - -40,0% (26) -60,0%(100) -54.7% -80,0% 1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 Net revenue (R$ mn) EBITDA (R$ mn) EBITDA margin (%) 12
  13. 13. Traffic – OHL State Concessions x Proxies Industry Payroll (1) vs. Passenger Vehicles (base 100 = 2002) 180 Ind. Payroll OHL Passenger Vehicles 170 160 150 140 130 120 110 100 90 80 Jan-02 Jul-02 Jan-03 Jul-03 Jan-04 Jul-04 Jan-05 Jul-05 Jan-06 Jul-06 Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Industry Output (1) vs. Commercial Vehicles (base 100 = 2002) 180 Ind. Output SP Ind. Output BRA OHL States - Comercial Vehicles 170 160 150 140 130 120 110 100 90 Jan-02 Jul-02 Jan-03 Jul-03 Jan-04 Jul-04 Jan-05 Jul-05 Jan-06 Jul-06 Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 - Industry Output and Industry Payroll updated until Oct/1013 - OHL Brasil data updated until Oct/10 (1) Source: IBGE
  14. 14. Seasonality of traffic – State and Federal Concessions State Concessions - Total Average 2002-2010 Federal Concessions - Total Average 2010 1.20 1.20 ABCR BRA ABCR BRA OHL State OHL Federal 1.15 1.15 ABCR SP ABCR SP AverageTrim. OHL Federal Average Trim. OHL State 1.10 1.10 1.05 1.05 1.00 1.00 0.95 0.95 0.90 0.90 0.85 0.85 jan feb mar apr may jun jul aug sep oct nov dec jan feb mar apr may jun jul aug sep oct nov dec Source: IBGE; ABCR SP – Brazilian Association of Highway Concessionaires – São Paulo; ABCR BRA – Brazilian Association of Highway Concessionaires – Brazil14
  15. 15. Traffic – Commercial vs. Passenger 3Q10 (Equivalent Vehicles) State Concessions Federal Concessions 23.6% 36.7% 63.3% 76.3% Commercial Passenger15
  16. 16. Traffic – Electronic Toll Collection – (Equivalent Vehicles) 60,0% 50,0% 40,0% 30,0% 56.7% 53.7% 53.8% 53.9% 56.0% 51.7% 51.4% 50.7% 53.0% 47.1% 49.7%44.2% 35.4% 36.9% 29.6% 30.2% 31.6% 25.0% 27.5% 10,0% 0,0% 0,0% 0,0% 0,0% 0,0% 1Q08 2Q08 3Q08 4Q08 1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 State Concessions Federal Concessions16
  17. 17. OHL Brasil’s Performance Consolidated Traffic Evolution (MN Equiv. Veihc.) Net Revenue (in R$ million) 1,189 446 725 616 428 1,090 430 142 389 840 550 127 105 108 111 306 268 505 100 99 159 93 2002 2003 2004 2005 2006 2007 2008 2009 9M10 2002 2003 2004 2005 2006 2007 2008 2009 9M10 Margin and EBITDA – fixed c. charge paid (in R$ million) ¹ Net Income (in R$ million) 62.8% 63.4% 64.5% 62.3% 65.4% 58.7% 57.8% 59.2% 52.4% 176 624 70 474 99 105 384 77 205 75 247 277 645 25 106 168 3 92 422 55 -8 2002 2003 2004 2005 2006 2007 2008 2009 9M10 2002 2003 2004 2005 2006 2007 2008 2009 9M10 (1 ) EBITDA margin excluding federal concessions17
  18. 18. Debt Structure Gross Indebtedness (in R$ million) Leverage Ratio and Net Debt (in R$ million) 2,473 2,504 2,5x 2,6x 2,4x 1,936 2,2x 1,9x 1,794 1,821 1,9x 1,8x 1,223 1,7x 1,657 1,287 1,4x 37 1,425 739 267 8471,012 1,037 922 1,784 1,450 1,455 1,291 1,325 1,346 1,354 933 935 1,158 1,197 1,186 1,281 1,174 947 915 735 652 79 1023Q08 4Q08 1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 3Q08 4Q08 1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 Long Term Short Term Net Debt Net Debt/ (EBITDA Fixed Concession Charge Paid) (LTM) - Debt Cost Breakdown Debt Amortization Schedule (in R$ million) 1,281.3 420.0 Bridge 861.3 BNDES 245.3 237.7 232.7 104.4 173.9 114.3 114.4 oct/10- oct/11- 2012 2013 2014 2015 2016 2017 sep/11 dec/1118
  19. 19. OHL Brasil’s Investments Estimated (1) CapEx – State (R$ million) Estimated (1) CapEx – Federal (R$ million) 910 930 880 683 620 528 440 197 182 371(2) 136 147 85 79 105 137(2) 2008 2009 2010E 2011E 2012E 2013E 2014E 2008 2009 2010E 2011E 2012E 2013E 2014E  State Concessions (2010-2014): R$598 million  Federal Concessions (2010-2014): R$3,8 billion (1) Base December 201019 (2) 9M10
  20. 20. Financing Plan for Federal Concessions R$ 2,3 bn  Financing the Capex for the first 8 years  Around 69% of the Capex BNDES1 Federal  Grace period of 2 years CAPEX  Repayment period in 12 yearsNext 5 years  Cost: TJLP + 200-300 bps margin R$ 3,4 bn  It will be concluded in 2011 R$143 mn  Bridge Loan of R$ 1 billion with BNDES  R$ 857 million already disbursed to 5 federal concessionaires until sep/10 R$857 mn  Maturity of 18 months and cost lower than 10.0% p.y R$241 mn OHL R$620 mn  Cash generation of federal and state concessions  Additional financing through debentures in state ConcessionsR$1,582 mn  Currently leverage Ratio low than 3.5x (Net Debt/EBITDA) R$839 mn Performed / Disbursed (until Sep/2010) Not Disbursed Credit Expected Amount to be Performed (1) BNDES = Brazilian Development Bank, is a federal public company, linked to the Ministry of Development, Industry and Foreign Trade (MDIC).20
  21. 21. Analysts Coverage – Target Prices and Recommendations 83,00 80,30 80,00 73,00 72,70 Average TP: 70,00 R$ 69.96 68,00 67,00 66,00 65,00 64,00 61,00 59,50 BB Safra Citi 73,00 Credit Suisse Votorantim 72,70 Santander Banco Fator UBS Barclays Merrill Lynch J.P. Morgan HSBC ItaúInvestimentos 70,00 Corretora Capital Securities 67,00 Buy Buy Hold Buy Buy Hold 65,00 Hold Buy Hold Buy Hold Sell Buy21
  22. 22. New OpportunitiesFederal Government – BR 101/ES/BA  Coverage: 475.9 km (BA-698 – ES, km 458.4)  Terms of Concession: 25 years  Conditions: the lowest tariff  Investments: about R$ 2,35 billion (R$ 893 million in the first five years)  Operation Costs (25 years): R$ 1,64 billion  Toll Plazas: 7  Toll Tariff: R$ 6.80 per 100 Km  Estimated Revenue (25 years): R$ 6,7 billionSource: ANTT - Jan/201022
  23. 23. New OpportunitiesFederal Government – BR-381/MG  Coverage: 301 km (between Belo Horizonte’s Beltway and the highway BR 116 - Governador Valadares)  Terms of Concession: 25 years  Conditions: the lowest tariff  Investments: about R$ 1,99 billion (R$ 1,13 billion in the first five years)  Operation Costs (25 years): R$ 835 million  Toll Plazas: 4  Toll Tariff: R$ 5.70 per 100 KmSource: ANTT - Jan/2007  Estimated Revenue (25 years): R$ 5,9 billion23
  24. 24. New OpportunitiesFederal Government – BR-040 (DF/GO/MG)  Coverage: 937 km (Federal District – Juiz de Fora)  Terms of Concession: 25 years  Conditions: the lowest tariff  Investments: about R$ 2,77 billion (R$ 1,29 billion in the first five years)  Operation Costs (25 years): 2,02 billion  Toll Plazas: 12  Toll Tariff: R$ 3.43 per 100 KmSource: ANTT - Jan/2007  Estimated Revenue (25 years): R$ 8,76 billion24
  25. 25. New OpportunitiesFederal Government – BR-116/MG  Coverage: 817 km (BR-393 RJ – BR-116 BA)  Terms of Concession: 25 years  Conditions: the lowest tariff  Investments: about R$ 3,55 billion (R$ 870 million in the first five years)  Operation Costs (25 years): R$ 1,73 billion  Toll Plazas: 8  Toll Tariff: R$ 4.80 per 100 KmSource: ANTT - Jan/2007  Estimated Revenue (25 years): R$ 8,51 billion25
  26. 26. New OpportunitiesMinas Gerais Government – PPP/MG  Coverage: 17 lots with 7,000 km No estimate date for the auction.26
  27. 27. New OpportunitiesRio Grande do Norte GovernmentConstruction and Operation of the São Gonçalo do Amarante Airport (ASGA)  Terms of Concession: 28 years (airport construction in 3 years and 25 years in operation)  Conditions: the highest Government Fee – (Minimum: R$ 3,7 million)  Investments (year 1–15): about R$ 650 million (R$ 429 million in the first six years)  Operation Costs (year 4–28): R$ 1,07 billionSource: ANAC - Dec/2009  Estimated Revenue (35 years): R$ 3,24 billion27
  28. 28. New Opportunities  Galeão (Rio de Janeiro) and Viracopos (Campinas-SP): The concessions of these two airports are expected to privately-owned enterprise. Photos from Toluca International Airport, airport concession of OHL Concesiones.28
  29. 29. Contacts OHL Brasil S.A.: Rua Joaquim Floriano, 913 – 5º andar Francisco Leonardo Moura da Costa Itaim Bibi – São Paulo – SP CFO and IR Director CEP 04534-013 francisco.leonardo@ohlbrasil.com.br Phone.: (+55 11) 3074-2404 Alessandro Scotoni Levy Financial Planning and IR Manager Visit our website: alessandro@ohlbrasil.com.br www.ohlbrasil.com.br/ir29

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