Profarma 4Q10

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Profarma 4Q10

  1. 1. 4Q10 and 2010 Earnings Release March, 3rd, 2011
  2. 2. Highlights in the Period• A drop of 3.7 days in the Companys cash cycle when compared with 2009 (IFRS base), to 49.0 days. This is theshortest cash cycle since 2006. This decrease resulted in a fall of about R$ 22.9 million in working capital;• The operating cash flow was positive for the third consecutive year and amounted to R$ 44.4 million, or 1.7% of thenet operating revenue;• The net debt stood at R$ 108.7 million in December 2010, a R$ 9.4 million decrease in relation to December 2009,mainly due to the Companys positive operating cash generation, of about R$ 44.4 million;• A rise of 3.0% in consolidated gross revenues year-over-year, totaling R$ 3.1 billion, highlighting the health andbeauty category, in which a sharp growth of 37.8% was recorded;• Sales through electronic orders hit a record high and accounted for 65.3% of total sales in 2010;• In October 2010, Profarma decided to terminate the market maker contract with Credit Suisse Brasil SA CTVM;nevertheless, there was no drop in daily liquidity. 3
  3. 3. Gross Revenues Evolution (R$ Million) 3,132.8 3,041.6807.4 809.8 832.34Q09 3Q10 4Q10 2009 2010 4
  4. 4. Gross Revenues Breakdown(R$ Million) 4Q10 4Q09 Chg. % 3Q10 Chg. % 2010 2009 Chg. %Branded 554.6 546.3 1.5% 537.8 3.1% 2,083.4 2,058.5 1.2%Generic 59.6 50.8 17.5% 56.2 6.1% 219.5 165.1 32.9%OTC 151.4 157.1 -3.6% 153.7 -1.5% 590.8 602.0 -1.9%Health and Beauty Products 43.9 26.2 67.3% 38.6 13.7% 142.3 103.2 37.8%Hospitals and Vaccines 22.7 27.1 -16.3% 23.5 -3.6% 96.6 112.7 -14.3%Total 832.3 807.4 3.1% 809.8 2.8% 3,132.8 3,041.6 3.0% 5
  5. 5. Market Share Evolution (%) 11.5 11.7 11.6* 10.9* 10.2* 10.2* 10.4* 9.6 2006 2007 2008 2009 2010 4Q09 3Q10 4Q10*Excluding the similar’s effect Source: IMS 6
  6. 6. Gross Profit and Revenues from Services to Suppliers (R$ million and as % Net Revenues) 11.7%11.0% 10.7% 10.2% 10.1% 37.9 100.3 181.1 263.618.6 26.8 28.457.1 43.3 41.74Q09 3Q10 4Q10 2009 2010 Gross Profit Revenues from Services to Suppliers Gross Profit Margin(%) 7
  7. 7. Operating Expenses (R$ million and as % Net Revenues) 7.4% 7.4% 7.5% 7.7% 7.1% 202.0 193.950.6 48.6 51.54Q09 3Q10 4Q10 2009 2010 8
  8. 8. Ebitda and Ebitda Margin (R$ million and as % Net Revenues)4.1% 4.3% 3.1% 3.0% 2.7% 110.7 79.928.0 21.5 18.64Q09 3Q10 4Q10 2009 2010 9
  9. 9. Net Financial Expenses (R$ million and as % Net Revenues) 1.1% 1.0% 0.9%0.8% 0.8% 28.5 26.75.3 5.4 6.04Q09 3Q10 4Q10 2009 2010 10
  10. 10. Net Profit (R$ million and as % Net Revenues)2.2% 2.1% 1.5% 1.3% 0.7% 53.2 34.415.4 10.5 4.74Q09 3Q10 4Q10 2009 2010 11
  11. 11. CASH FLOW(R$ Million) 4Q10 4Q09 Chg. % 3Q10 Chg % 2010 2009 Chg. %Cash Flow Generated / (Used) in Operating Activities (21.3) (19.2) -11.0% 62.1 - 44.4 80.2 -44.7% Internal Cash Generation 22.2 23.7 -6.1% 9.5 134.4% 67.9 92.5 -26.6% Operating Assets Variation (43.5) (42.9) -1.5% 52.7 - (23.5) (12.3) -91.4% Trade Accounts Receivable (16.4) (25.1) 34.5% (50.8) 67.7% (40.6) (8.6) -371.2% Inventories (88.0) (81.8) -7.5% (10.4) -742.5% (1.2) (35.0) 96.6% Suppliers 118.2 91.3 29.5% 120.6 -2.0% 45.1 80.8 -44.1% Other Items (57.4) (27.3) -109.9% (6.8) -749.1% (26.8) (49.4) 45.8%Cash Flow (Used) in Investing Activities (3.3) (3.6) 7.5% (1.5) -122.0% (8.1) (11.8) 30.9%Cash Flow Generated / (Used) by Financing Activities (15.5) (9.9) -56.8% (43.8) 64.6% (43.8) (94.3) 53.5%Net Increase / (Decrease) in Cash (40.1) (32.6) -22.8% 16.9 - (7.5) (25.8) 70.8% 12
  12. 12. Cycle Previous IFRS Cycle IFRS Basis 4Q08 4Q09 3Q10 4Q10 4Q08 4Q09 3Q10 4Q10 Cash Cycle (Days) * 65.8 52.7 48.8 49.0 Cash Cycle (Days) * 66.0 52.7 48.8 49.0 Accounts Receivable(1) 45.9 41.1 43.3 43.6 Accounts Receivable (1) 45.9 41.1 43.3 43.6 Inventories (2) 49.9 49.6 40.6 48.7 Inventories (2) 53.6 53.9 43.9 52.0 Accounts Payable (3) 29.9 38.0 35.1 43.3 Accounts Payable (3) 33.5 42.3 38.4 46.6* Average:(1) Average of Gross Revenues in the Quarter (2) Average of COGS in the Quarter (3) Average of COGS in the Quarter 13
  13. 13. Indebtedness: Net Debt and Net Debt / Ebitda* (R$ million) 1.4x 1.4x 1.1x 1.1x 0.8x 118.1 118.1 108.7 108.7 75.1 4Q09 3Q10 4Q10 2009 2010* Ebitda = Accumulated last 12 months 14
  14. 14. Capex (R$ million and % as Net Revenues)0.5% 0.5% 0.5% 0.3% 0.2% 12.0 8.33.7 3.5 1.54Q09 3Q10 4Q10 2009 2010 15
  15. 15. Operating Indicators Service Level Logistics E.P.M. (Units served/ Units requested) (Errors per Million)93.0% 170.0 90.4% 130.0 88.1% 93.04Q09 3Q10 4Q10 4Q09 3Q10 4Q10 16
  16. 16. Profarma vs Ibovespa -% year 2010120110100 101 9590 * Base 100 em 30/12/200980 Jan-1030-dez-09 Feb-10 29-jan-10 Mar-10 28-fev-10 Apr-10 May-10 30-mar-10 29-abr-10 Jun-10 29-mai-10 Jul-10 28-jun-10 Aug-10 28-jul-10 Sep-10 27-ago-10 Oct-10 26-set-10 Nov-10 26-out-10 Dec-10 Jan-11 25-nov-10 25-dez-10 Ibovespa Profarma 17
  17. 17. Analyst CoverageCompany Analyst Telephone E-mail Javier Martinez de Olcoz Cerdan (1 212) 761-4542 javier.martinez.olcoz@morganstanley.comMorgan Stanley Clarissa Berman (55 11) 3048-6214 clarissa.berman@morganstanley.comMerrill Lynch Alexandre Pizano (55 11) 2188-4024 alexandre.pizano@baml.comCredit Suisse Marcel Moraes (55 11) 3841-6302 marcel.moraes@credit-suisse.com Juliana Rozenbaum (55 11) 3073-3035 juliana.rozenbaum@itausecurities.comItaú BBA Marcio Osako (55 11) 3073-3040 marcio.osako@itausecurities.comBanco Fator Iago Whately (55 11) 3049-9480 iwhately@bancofator.com.brRaymond James Guilherme Assis (55 11) 3513-8706 guilherme.assis@raymondjames.comBTG Pactual João Carlos dos Santos (55 11) 3383-2384 joaocarlos.santos@btgpactual.com 18

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