Estacio Apresentacao Apimec 20071221 Eng

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Estacio Apresentacao Apimec 20071221 Eng

  1. 1. www.estacioparticipacoes.com/ir João Rosas COO César Lage CFO and IRO 12/12/2007 0
  2. 2. Disclaimer 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 Estácio Participações. These are merely projections and, as such, are based exclusively on the expectations of Estácio Participações’ 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, among other factors and risks disclosed in Estácio Participações’s filed disclosure documents and are, therefore, subject to change without prior notice. Since the Company was constituted only on March 31, 2007, we present, for the sole purpose of comparison, the non-audited pro-forma information for the nine months of 2006 and 2007, as if the company's constitution had occurred on January 1, 2006. In addition, certain information was presented adjusted to reflect the payment of taxes at SESES, our largest subsidiary, which, starting in February 2007 and as a result of its transformation into a for-profit company, being subject to the tax laws applicable to other legal entities, notwithstanding the exemptions arising under the University for All Program (PROUNI). The information presented for comparison purposes should not be used as a base for the purpose of calculating dividends, taxes or any other corporate purpose. We are a holding company, and our only assets are our interests in SESES, STB, SESPA, SESCE, SESPE and UniRadial, and we currently hold 99.9% of the capital stock of each of these subsidiaries. We are a holding company incorporated on March 31, 2007 as a result of a corporate restructuring that segregated the post-secondary education operations of our subsidiaries SESES, STB, SESPA, SESCE and SESPE under our common control. 1
  3. 3.  1. Visão Geral Company Overview  Brazilian Post-Secondary Education Market  Business Strategy  Operating and Financial Highlights 2
  4. 4. Highlights      *wholly-owned subsidiaries 3
  5. 5. Geographic Coverage State of Rio de Janeiro 2,753 students 11,672 students 2nd largest market in Brazil 12.6% of GDP 15.4 million inhabitants 677 students 425 thousand students enrolled in post-secondary programs 116 thousand students (ESTC) 4,817 students Source: SINAES/2005 5,553 students 1,745 students 11,206 students 1,677 students 2,983 students 1,804 students 1,376 students 2,679 students 10,141 students 4,168 students Subsidiaries : 4
  6. 6. Growth and Profitability Turnaround Number of undergraduate Organic Growth National 174 179 Leadership 162 students (000) 166 135 UniRadial 144 North and Acquisition 141 SESES for- Aug/07 Northeast profit status (SP / PR) institutions for- 118 achieved profit status Beginning of (feb/2007) achieved (2007) national expansion project 70 51 35 23 26 1970/96 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 JUN SEP 2007 5
  7. 7. Estácio: The Leading Player Market share Rio de Janeiro (number of students) – 2005 Brazil (number of students) – 2005 Smaller Institutions 3.7% 27.3% Unip 2.4% Ulbra 1.5% Universo 13.7% Universo 1.3% Other 88.1% Other Unipac 1.1% 27.1% UniverCidade 7.4% Uninove 1.0% SUAM 4.5% Uniban 0.9% UVA UniGranrio 2.4% UGF 4.2% 11.9% PUC RJ UNIG UCAM 3.9% 2.6% 3.0% 3.8% Total: 425 thousand students Total: 4.5 million students Source: SINAES Source: SINAES/MEC/INEP 6
  8. 8. Perception of Quality Average 2004, 2005 and 2006 ENADE’s Evaluation 2006 Brazilian Bar Association Pass Rate in Rio de Janeiro AVERAGE 3.10 3.15 95% 88% 85% Unipac 3.05 76% 75% AVERAGE 63% Ulbra 2.98 61% 58% 56% Anhanguera 2.93 43% Uninove 2.86 Universo 2.85 UERJ UFRJ Cândido Gama UNIVERSO Unip 2.76 Mendes Filho Veiga de PUC-RJ UniverCidade Almeida ENROLLED STUDENTS Uniban 2.58 204 268 282 2,225 1,203 1,245 373 199 483 Source: Ministry of Education – ENADE (National Evaluation) Source: Ordem dos Advogados do Brasil (OAB - RJ) 7
  9. 9. Opportunities for Expansion Operational Increase in market synergies in the share and improved acquisitions and margins business turnaround plan on course Price, Quality and Convenience ‘Asset Light’ Growth Model Consolidation 4 Structured Expansion Better Value 3 Proposition for the Student Higher return on 2 capital invested 1 8
  10. 10.  1. Visão Geral Company Overview  Brazilian Post-Secondary Education Market  Business Strategy  Operating and Financial Highlights 9
  11. 11. Sector Overview Largest market in Latin America and 5th in the world, with low penetration rate Post-secondary Enrollment in 2005 (000) Gross Enrollment Rate1 – Post-secondary (2005) 83% 23.4 17.3 71% 65% 11.8 48% 9.0 22% 24% 24% 4.5 4.0 11% China USA India Russia Brazil Japan India China Brazil Mexico Chile Argentina Russia USA 1. Percentage of students completing high school directly enrolling in post-secondary Source: Unesco/INEP/MEC/SINAES education Source: Unesco Enrollment in Brazil – Post-secondary (million) Post-secondary Institutions in Brazil (in number of units) 4.5 4.2 Private 3.9 Private CAGR 3.5 CAGR 12.2% 3.0 12.5% 72% 73% 71% 1,934 70% 1,789 69% 1,652 1,442 1,208 31% 30% 29% 28% 27% 183 195 207 224 231 2001 2002 2003 2004 2005 2001 2002 2003 2004 2005 Public Private Public Private Source: INEP/MEC Source: INEP/MEC 10
  12. 12. Strong Growth Potential Demand for qualified professionals should drive enrollment in post-secondary institutions Proportion of Post-Graduate Enrolled Students between 20 and 24 years old 45 2010 Brazil 5.7 million 40 Estimate (CAGR 4.8%) 35 30 Brazil Average: 21.6% Source: Hoper Educacional 25 20 15 2010 Brazil 7.1 million 10 Target* (CAGR 21.7%) 5 0 •Taget of 30% penetration (18-24 years old population) DF RS SC RJ MS SP PR GO TO ES MT AM MG PI AP RN AC RO PB PE SE RR AL CE PA BA MA (Penetration 2005: 10.9%) Source: Plano Nacional de Educação/IBGE Source: IBGE/MEC/INEP/Paulo Renato Souza Consultores Number of young working adults in post-secondary education (million) 3.0 2.6 2.3 2.0 1.8 1.6 2005 2006 2007E 2008E 2009E 2010E Source: Gismarket / IBGE / INEP 11
  13. 13. Highly Fragmented Market Top 10 largest post-secondary institutions account only for 17% of total enrolled students Top 10 Private Institutions Market Share (2005) Top Players in Brazil in 2005 (in 000 students) Based on Number of Enrolled Students 166.5 17.4% 106.9 82.6% Total: 3.3 million of enrollments 66.0 58.2 Source: Hoper Educacional 47.8 43.8 41.5 Private Institutions vs. Students (2005) 131 5K or more 173 2K < 4.9K Unip Ulbra Universo Unipac Uninove Uniban 500 < 1.9K 616 For-profit institutions Non-profit institutions Source: SINAES Up to 499 1,014 Total: 1,934 Institutions High potential for Consolidation Source: Hoper Educacional 12
  14. 14.  1. Visão Geral Company Overview  Brazilian Post-Secondary Education Market  Business Strategy  Operating and Financial Highlights 13
  15. 15. Value Proposition: Seizing Market Opportunities, Growth and Profitability  Convenience  Location DEFINITION OF OUR TARGET MARKET  Competitive price SUPPLY TRIGGERS Youth aged 18 to 24 Job seekers  Quality fit Workers who also study Self-financed students  Labor-market oriented  Adequate facilities Growth Strategy Operational Improvement Organic Acquisition Business Turnaround 14
  16. 16. Organic Growth  New programs to attract and retain students  Job Placement programs Consolidation Marketing efforts Competitive prices in all markets  Transformation into university centers Growth  Open of new units/Campuses Related Business  Distance Learning 15
  17. 17. Acquisition: Target Market Strategic Fit Growth Synergies Potential Full Companies Operating Units  Over 5,000 students  Any size but with preference to those with over 1,000 students  Compatible stand  Compatible market position  Priority for university centers  Only for expanding already  Priority for institutions existing units expediting capture of operating synergy  Administrative and academic synergy 16
  18. 18. Aquisições: UniRadial Radial University Center Acquisition Expansion of operations in 2 of Brazil’s largest markets: São Paulo and Paraná Company structure Location  Over 40 years of tradition and quality  8 campuses (1 university center) New Campuses São Paulo  10,100 students (sept/07) 2008/2009  23 Campuses (undergraduation, technology and Lato sensu post- 7 campuses Paraná graduate programs) 1 campus  31% of Brazilian GDP  21.6% of Brazilian population  GDP per capita of R$13.7 thousand (US$ 7.8 thousand)  1.2 million students enrolled  28.5% of the enrolled students between 20 and 24 years old 17
  19. 19. Operational Improvement Optimization and standardization of Rollout of SAP and SIA (academic) courses and centralization of systems in all units backoffice. Cost Reduction / Continuous Improvement Management Targets Increasing use of Distance (bonus program) Learning 18
  20. 20.  1. Visão Geral Company Overview  Brazilian Post-Secondary Education Market  Business Strategy  Operating and Financial Highlights 19
  21. 21. Revenue Enrolled Students (thousands) 172.2 172.5 -0.2% Average Tuition 415.8 400.0 3.9% Net Revenue (R$ million) 20
  22. 22. EBITDA EBITDA (R$ million) 21
  23. 23. EBITDA Margin EBITDA Margin EBITDA Margin: ex-rentals 22
  24. 24. Net Income Net Income (R$ million) Net Income (R$ million) Excluding the extraordinary IPO expenses (R$15.5 million in the 3Q07 and R$17.2 million in the 9M07 23
  25. 25. Investments (Capex) Organic Capex (R$ million) Capex / Depreciation Capex (R$)/ Student 159 78 9M06 9M07 24
  26. 26. Cash Flow Cash Flow - 3Q07 (R$ million) 25
  27. 27. Ownership Breakdown and Units Performance Common Preferred Shareholders (thousand) Shares % Shares % Total % Controller and Related Shareholders 142,054 87.7 34,109 46.3 176,163 74.8 UBS Pactual Asset Management 1,846 1.1 3,699 5.0 5,545 2.4 Other (free-float) 18,018 11.2 36,029 48.7 54,047 22.9 Total 161,918 100.0 73,837 100.0 235,755 100.0 120% 110% 100% 90% 80% 70% 60% 50%   40%  30% * 1 unit = 2 preferred shares and 1 common share  20%  10%  0% 7/30 8/9 8/19 8/29 9/8 9/18 9/28 10/8 10/18 10/28 11/7 11/17 11/27 12/7 ESTC11 IBOV IVBX-2 26
  28. 28. IR Contact Thank You! Visit our website: www.estacioparticipacoes.com/ir Investor Relations Carlos Lacerda – carlos.lacerda@estacio.br Pedro Alvarenga – pedro.alvarenga@estacio.br e-mail: ri@estacioparticipacoes.com Phone: (55) 21 3410 7250 / 7298 / 7110 27

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