Localiza Rent a Car is the largest car rental company in Brazil, with over 280 branches across 6 countries. It has the largest fleet in South America of over 37,000 cars. Localiza has several competitive advantages including its integrated business platform, largest distribution network, leadership position, and strong brand recognition. It is focused on further consolidation in the industry and expanding into new markets like airport rentals and fleet replacement as the Brazilian economy and credit markets continue to grow.
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2. Localiza Rent a Car is the most competitive regional car rental company in the world
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4. Competitive Advantages Rent a Car Fleet Franchising Used Car Sales Synergy: Cost Reduction; Cross Selling; Bargaining Power Integrated Business Platform Largest Distribution Largest Fleet Yield Management Brand Recognition Leadership Management
5. Competitive Advantages 283 branches 6 countries Integrated Business Platform Largest Distribution Largest Fleet Yield Management Brand Recognition Leadership Management
6. Competitive Advantages Localiza network is larger than the second, the third, the fourth and the fifth competitors combined (number of agencies in Brazil) 228 229 Integrated Business Platform Largest Distribution Largest Fleet Yield Management Brand Recognition Leadership Management
7. Competitive Advantages Localiza network in airports is larger than the second and the third competitors combined. (number of agencies in Airports) Integrated Business Platform Largest Distribution Largest Fleet Yield Management Brand Recognition Leadership Management 68 32 28 24 10
8. Competitive Advantages The largest fleet in South America 37.280 cars Integrated Business Platform Largest Distribution Largest Fleet Yield Management Brand Recognition Leadership Management
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11. Competitive Advantages Facilities Integrated Business Platform Largest Distribution Largest Fleet Yield Management Brand Recognition Leadership Management
12. Competitive Advantages Loyalty Program Integrated Business Platform Largest Distribution Largest Fleet Yield Management Brand Recognition Leadership Management
13. Competitive Advantages Shuttle Service Integrated Business Platform Largest Distribution Largest Fleet Yield Management Brand Recognition Leadership Management
14. Competitive Advantages Hand held Integrated Business Platform Largest Distribution Largest Fleet Yield Management Brand Recognition Leadership Management
65. Financials Revenues EBITDA Net Income Ratios Ratings 27 106 91 77 80 CAGR: +19% +4% Net Income 64* 69* * Pro forma result disregarding mark-to-market (MTM) of derivative contracts. ** Annualized. Net income / Equity 33,5%* 29,7%* 37,1%* 36,1%**
66. Financials Revenues EBITDA Net Income Ratios Ratings * annualized ** except fair value adjustment 3,72 6,41 4,70 5,57 EBITDA * / NET FINANCIAL EXPENSES ** 0,95 0,96 0,36 1,01 NET DEBT / EQUITY 0,49 0,46 0,22 0,56 NET DEBT / FLEET 1,28 1,34 0,57 1,32 NET DEBT / EBITDA 30/09/05 31/12/04 31/12/03 31/12/02
68. As the Brazilian economy is performing well we have some opportunities
69. Opportunities Consolidation GDP Airport Traffic Credit Expansion Replacement 34% 20% 10% 18% 10% 8% Consolidated market in USA: five players = 92% Source: Fleet Central. 2004 data Local players
70. Opportunities Consolidation GDP Airport Traffic Credit Expansion Replacement 1999 = 59% 2001 = 72% Consolidation in Europe: six players Local players Local players Local players 41% 15% 13% 5% 5% 10% 11% 28% 18% 16% 8% 6% 11% 13%
71. Opportunities Consolidation GDP Airport Traffic Credit Expansion Replacement 69% 16% 7% 4% 4% Local players Localiza Unidas Avis Hertz Consolidation in Brazil 2004: four players = 31%
72. Opportunities Consolidation GDP Airport Traffic Credit Expansion Replacement Number of car rental companies Consolidation in Brazil 2004: four players = 31% CAGR = -11% 2,511 2,340 1,985 69% 16% 7% 4% 4% Local players Localiza Unidas Avis Hertz
75. Opportunities Consolidation GDP Airport Traffic Credit Expansion Replacement Car rental division average growth of 4 x GDP in the last five years GDP
76. Opportunities Consolidation GDP Airport Traffic Credit Expansion Replacement Airport traffic Low cost – low fare airlines have increased 19% y/y growth (2005/2004)
77. Opportunities Consolidation GDP Airport Traffic Credit Expansion Replacement Credit expansion 55,4 million major credit cards 23 million credit card holders Up to 10 installments just in Localiza
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79. Rent 3 36.9% Free Float and foreign investors participation of roughly 84,8% Performance RENT3 since IPO: +98% (1) Relative Performance RENT 3 x IBOV: almost +60,0% (1) Average Volume of R$3.3 million Target price of R$26.00* (1) From May 23 (IPO date until November11, 2005 * Credit Suisse Report as of November 8, 2005