Brph apresentação institucional_(23.08.12) v8 (eng)

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Brph apresentação institucional_(23.08.12) v8 (eng)

  1. 1. Brazil PharmaInstitutional Presentation August, 2012
  2. 2. Shareholder’s Structure Analysis BTG Pactual + FIPs Operating Partners Managers Free Float 35.7% 27.1% 0.6% 36.6% 100% 100% 100% 100% 100% 100%Note: Considering 15 millions shares to be issued from Sant’ana’s incorporation. 2
  3. 3. Company Overviewand IndustryDynamics
  4. 4. DrugstoresA Growth and Accelerating HistorySales Performance in the Brazilian Pharmacy Retail Sector from 1996-2011 (R$ Billion) 43.00 36.00 30.20 26.40 23.60 21.50 19.20 17.20 14.80 13.10 11.20 11.60 9.40 10.30 8.30 7.00 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 1997 – 2000 2001 - 2002 2003 – 2005 2006 – 2007 2008 – 2011 1997: Asian Crisis 2002: Crisis pre-Lula 2003-04: First years of 2006: Second Lula 2008: Subprime 1998: Russian Crisis election Lula´s election election Crisis 1999: Real Depreciation 2001: Argentine Default 2004: Mensalão scandal 2010: Greece Debt 2000: Internet Bubble burst Crisis Drivers Macro Drivers Micro Timing Fragmented Formalization and Income Growth Population Aging Generics Drugs Regional Brands Market Consolidation Source: IBGE. Farmácia Popular. Health. OMS IMS. Brazil Banco Central do Brasil 4
  5. 5. Brazil Pharma: Leadership PositionBrazil Pharma consolidates its leadership position in four of the five regions of Brazil. Becoming the largest retailpharmacy (ex-Southeast) 1 Number of Stores North Northeast Mid-west Southeast South 1o 2o (2) 3o n/a (2) (2) (2) (2) (2) 4o n/a n/a n/a n/a n/aSource: Brazil Pharma, Abrafarma 5Note: (1) Ranking by number of owned stores as of Dezember 31, 2011 considering the four largest Drugstore chains in Brazil; (2) n/a: Other chains do not have operations in the region
  6. 6. Brazil Pharma: Footprint Largest Drugstore Chain in the Brazilian Retail: Ready to Growth and Consolidating 232 ¹ Owned86 stores 1 114 ² Owned stores 103 20 1 10 118 Owned stores 15 75 201 Owned stores 7 114 10 352 Franchises 89 REGIONS 19 Owned stores Footprint North 104 Northest 242 Midwest 118 8 Southeast 193 South 201 1.017 stores 665 owned stores 352 Franchises 05³ Distribution centers1) Includes 69 stores from Guararapes’ platform ; 2) Includes 11 stores acquired from Estrela Galdino on April 2012 and added to Sant’Ana’s store count in June 30, 2012.Therefore they generated no revenues in 62Q12 ; 3) Sant’Ana’s Distribution Center has suffered a fire on December 2011. A new distribution center will be inaugurated in the second half of 2012.
  7. 7. Brazil Pharma: Market PenetrationGrowth already contractedLarge Growth Capacity Maturation of Owned StoresOrganic Growth (# owned stores) (2Q12)Market Growth Diversified Sales Mix(CAGR07’-11’) (2Q12) Brazil Pharma Abrafarma HPC Branded Generics 7
  8. 8. Brazil Pharma: Market Consolidation Strategic Growth based on M&A and Organic Growth IPO @ Platform Actual Platform (1Q11) (2Q12) 663 Points of sale 1,017 Points of sale 302 Owned Stores 665 Owned stores 361 Franchises 352 Franchises 60 Owned stores 232 Owned stores 1 114 Owned stores 118 Owned stores 89 Owned stores 361 Franchises 352 Franchises 201 Owned stores 153 Owned storesOwned storesFranchisesDistribution Center (1) Sant’Ana’s Distribution Center suffered a fire on December 2011. A new distribution center will be inaugurated in the second half of 2012 ; (2) Includes 11 stores acquired from Estrela 8 Galdino on April 2012 and added to Sant’Ana’s store count in June 30, 2012.Therefore they generated no revenues in 2Q12.
  9. 9. Focus on Integration
  10. 10. Brazil Pharma: Our HistoryGreat regional companies into a Excellent National Company 186 years of History IPO 1945 1965 1975 1994 1994 1995 2009 2011 2012 2013E 2014E 2015E 2016E 10
  11. 11. Brazil Pharma: Your first option! Distinct Companies Holding Corporate Unique Company Administrative Commercial Operations (SSC) #1 for Suppliers #1 for Customers #1 for Talents 11
  12. 12. Brazil Pharma: Commercial Structure Procurement / Trade Marketing/ Corporate• Orders;• Negotiation;• Supplier Service; Sell Out• Controls. Procurement / Trade Marketing/ Corporate Sell Out Sell In Sell Out Sell Out Team / Execution • Trade Marketing; Sell Out • Stores visitation; • Generation of local demand; • Campaings. 12
  13. 13. CompanyHighlights
  14. 14. “More with Less”Incresing operational efficiency and stores productivity BRPH @ IPO (1Q11) BRPH 2Q12 # of store employees per store 22,6 20,4 -10% # of administrative + distribution center employees per store 3,8 3,5 -8% EBITDA (ex-G&A) per employee1 (R$ thousand) 3,7 6,4 +74% EBITDA per employee2 1,5 3,0 (R$ thousand) +98% Sales per store level employee 34,4 54,9 (R$ thousand) +60% # of stores opened in the period 10 22Notes: (1) Considers total stores and distribution centers employees. 14 (2) Considers total employees (store, distribution centers and administrative).
  15. 15. Performance compared to peersSSS Retail (2Q12) Stores under Maturation (2Q12) Stores < 12 months Stores > 24 months < 36 months Stores > 12 months < 24 months Stores > 36 monthsGrowth of Store Basis 1o 2o 2o 1o 15
  16. 16. DifferentiationPortfolio differentiation by products and categories allows Brazil Pharma to capture higher margins over salesUnique Positioning Sales Mix Product sales mix: 2Q12 (% of Gross Revenue) Right mix Brazil Pharma Abrafarma Differentiated service Exclusive brands 26.3% 36.5% 63.5% Loyalty program 73.7% New products Medicine Non-Medicine Virtuous Purchase Cycle… Generics Potential Medicine sales mix: 2Q12 (% of Gross Revenue) Brazil Pharma Abrafarma Customers Product 15.3% Benefits 26.9% Attendance Convinience 73.1% 84.7% Price Generics BrandedSource: Brazil Pharma e Abrafarma 16
  17. 17. Experienced ManagementManagement # Years # Years Experience Pharma Market Financial IndustryAndré Sá 3 12 CEOSara Rezende 2 6 EntrepreneurshipCFO ExperienceRenato Lobo n/a 18Investor RelationsCarlos DutraCommercial Director 20 n/aFlavio SanchezShared Services Officer 1 16 Gilberto PortelaHead of Institutional Relations 30 n/a Pharmacy MarketÁlvaro Silveira Jr. Experience 22 n/aHead of Midwest OperationsWilson José LopesHead of South Operations 25 n/aRaul Aguilera 25 n/aHead of North and Northeast OperationsWesley Barbosa 10 n/aHead of Bahia OperationsBoard of Directors Marcelo Kalim 15 FinancialBoard Member n/a ExpertiseCarlos Fonseca 14Board Member n/a Álvaro Silveira n/a 36 MarketBoard Member ExpertiseRoberto Martins 20 22Board Member José Luiz DepiereBoard Member 14 n/a ManufacturingArtur Grynbaum ExpertiseIndependent Board Member 25 n/a 17
  18. 18. Performance of BPHA3 versus IBOVSince its IPO, Brazil Pharma stock outperformed the Ibovespa by 48.2%.Indexed Stock Price (Base 100)06/27/2011 to 09/05/2012 11/03/2011: 11/28/2011: 12/26/2011: 02/13/2012: 04/16/2012: 06/21/2012: Big Ben Estrela Stock Split Sant’ana Beauty’In Follow-on MoU Galdino MoU MoU MoU R$ 22.00 R$ 12.77 IPO 56.863 Since IPO (06/24/11): Brazil Pharma: + 48.2% Raia Drogasil: + 115.3% Ibovespa: (6.8%) 2012 YTD: Brazil Pharma: + 46.0% Raia Drogasil: + 67.3% Ibovespa: (1.7%) Acquisitions Corporate Events Source: Econométrica in 05 September, 2012. 18 Note: “MoU” means Memorandum of Undestanding
  19. 19. Operational andFinancial Highlights
  20. 20. Sales ProfileStrong historical sales growth and same-store sales(SSS)Same-store sale1,2(Total) (Mature stores)Sales Mix1,2 Average Ticket1,2(% of Gross Revenue) (R$) (1) As Juny 30, 2012 20 (2) Proforma information for all platform
  21. 21. Financial HighlightsGross Revenue¹ Gross Profit and Gross Margin1(R$‘000) (R$’000 % of Gross Revenue)Adjusted EBITDA and EBITDA Margin1,2 Adjusted Net Profit and Adjusted Net Margin1,3(R$’000 % of Gross Revenue) (R$’000 % of Gross Revenue) (1) As of 30 Juny, 2012, proforma for all platform. (2) Adjusted Ebitda, excludes non-recurring expenses. 21 (3) Adjusted net profit, excludes non-recurring expenses, brand and intangible assets amortization and non-recurring IR and Social contribution effect.
  22. 22. Use of ProceedsSource of Proceeds Use of(Primary Offering¹) Proceeds  Non current Debt Amortization timetable2 229.4 144.6 R$ Optimization 99.7 91.1 of the capital 238mm structure 48.5 R$ 476mm  Constant focus on the reduction of the cash cycle Working Capital, R$ M&A and  100 news stores in 2012; (~R$650 thousand for each new store) 190mm Organic Growth  Improvement and capacity expansion on the DCs  Invested Capex of R$47,7 million in 2012  IT and systems: first class ERP and managing and integration R$ Operational system optimization Efficiency and 48mm Systems  SSC and unification of the call center (1) Considers net cash of R$69,8 million related to the exercise of the Supplemental Option (Green Shoe) 22 (2) Non current debt amortization of R$613,2 million, as of 30 June, 2012 (2Q12).
  23. 23. Appendix
  24. 24. Remaining Lock-up Period Operating Partners know their regions and the specific characteristics as product mix, stores location and price sensitivity All acquisitions have non-compete clauses after the sale of Operating Partners sharesLock-up Period 2010 2011 2012 2013 2014 2015 2016 1 Jun/2011 Jun/2014 2 Jun/2011 Jun/2014 1 Fev/2012 Fev/2015 1 Mar/2012 Mar/2015 (1) ) After the 3 years lock-up shareholders have the right to sell all stake 24 (2) Shareholders have the right to sell up to 1/3 of the shares every year after the first anniversary of the IPO
  25. 25. Brazil Pharma Consolidation Since its foundation in 2009, Brazil Pharma has been successfully implementing its growth strategy based in acquisitions and organic growth Total number of stores (owned stores + franchises) 998 1017 986 824 Debentures 681 Issuance Follow on 663 Sant’Ana’s 506 Acquisition Acquisition 498 Big Ben’s 468 Acquisition 465 397 Mais 384 Launching Econômica IPO Acquisition Guararapes the Multiplus Grupo Farmácia dos and RNF Fidelity (RNF) Rede Rosário Pobres´ Merger program Nordeste de Distrital (GRD) points-of-sale (GRD) Farmácias´ Acquisiton Farmais’ Foundation points-of-sale AcquisitionAcquisition Acquisition Sep May Jun Jul Aug Oct Jan Mar Jun Nov Feb Apr Jun 2009 2010 2010 2010 2010 2010 2011 2011 2011 2011 2012 2012 2012 25

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