Csfb & Aviation Week Aerospace & Defense Finance Conference
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This presentation from Embraer provides an overview of the company's commercial and defense businesses. Some key points: - Embraer is the 4th largest commercial jet manufacturer and a leader in aerospace technology. - Their commercial aircraft families include the ERJ 135/140/145 and the newer E-Jet 170/190, with over 1,000 total orders. - Embraer also provides defense products like the Super Tucano and has orders for aircraft like the KC-390. - The company has experienced strong financial performance in recent years with increasing net sales, EBITDA, and net income margins.
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Csfb & Aviation Week Aerospace & Defense Finance Conference
- 1. CS First Boston & Aviation Week Aerospace & Defense Finance Conference May 2002
- 2. Foward Looking This presentation includes forward-looking statements or statements about events or circumstances which have not occurred. We have based these forward-looking statements largely on our current expectations and projections about future events and financial trends affecting our business and our future financial performance. These forward-looking statements are subject to risks, uncertainties and assumptions. The words “believes,” “may,” “will,” “estimates,” “continues,” “anticipates,” “intends,” “expects” and similar words are intended to identify forward-looking statements. We undertake no obligations to update publicly or revise any forward-looking statements because of new information, future events or other factors, In light of these risks and uncertainties, the forward-looking events and circumstances discussed in this presentation might not occur. Our actual results could differ substantially from those anticipated in our forward-looking statements.
- 4. Company Highlights Fourth largest commercial aircraft manufacturer in the world, with leading aerospace products and technology Premier global customer base - strong market share Strong global partners Outstanding financial performance Largest exporter in Brazil in 1999, 2000 & 2001
- 5. Commercial Market ERJ 135/140/145 Jet Family 37, 44 and 50-seat jet family 96% commonality between aircraft As of March 31, 2002: 865 firm orders and 359 options 531 aircraft delivered since ’96
- 6. ERJ 145 Family Orderbook Firm Options Deliveries Firm Total Backlog ERJ 135 121 47 168 89 32 ERJ 140 174 45 219 32 142 ERJ 145 570 267 837 410 160 Total 865 359 1,224 531 334 March/2002
- 7. Commercial Market EMBRAER 170/175/190/195 Jet Family 70,78, 98 and 108-seat jet family 112 firm orders and 202 options on January 31, 2002 Nearly two-thirds of development costs borne by risk sharing partners Deliveries scheduled to begin in 2Q03 with EMBRAER 170
- 8. EMBRAER 170/190 Family Orderbook Firm Options Total EMBRAER 170 82 130 212 EMBRAER 190 30 72 102 Total 112 202 314 March/2002
- 9. Corporate Market - Legacy Corporate Jet based on the ERJ 135 Launched in July 2000 Versions Executive Corporate Shuttle Transport for Authorities
- 10. Legacy Orderbook Firm Firm Options Total Deliveries Backlog Legacy Executive 41 38 79 - 41 Legacy Shuttle 25 50 75 - 25 EMB 135/145 7 6 837 7 - Total 73 94 167 7 66 Current as of Mar 2002
- 11. Defense Market SUPER TUCANO AMX / AMX-T F-5 BR EMB 145 AEW&C EMB 145 RS EMB 145 MP/ASW LEGACY/ EMB 135/140/145 EMB 120K
- 12. Embraer Business
- 13. Embraer Business The aerospace business is supported by 5 pillars High Technology Qualified People Global Business Cash Intensiveness Flexibility
- 14. High Technology
- 15. High Technology The Virtual Reality Center Provides visualization of the aircraft structure and systems during the project phase, using 3D electronic models Reduces the development cycle
- 16. High Technology Digital Mock-Up EMBRAER 170
- 17. High Technology Digital Mock-Up ERJ 145
- 18. Qualified People
- 19. Qualified People 25% of the 11,048 employees, are engineers PhD Educational Levels 0,2% Graduate 29,3% Post Graduate High School 4,7% 64,5% Master 1,3%
- 20. Qualified People More than US$ 60 million invested in training and qualification in the last 3 years. 21 24,5 18 1999 2000 2001
- 21. Global Business
- 22. Global Business Civil & Defense Aircraft flying in 58 countries in 5 continents.
- 23. Global Business Current Fleet of Regional Aircraft ERJ Operators Turboprop Operators Europe 285 aircraft 40 customers North America 920 aircraft Asia 35 customers Pacific 60 aircraft 20 customers Latin America & Caribbean Africa & 260 aircraft Middle East 85 customers 55 aircraft 10 customers
- 24. Global Business Operations in Brazil, United States, Europe, Asia and Australia USA UK Weybridge Dallas China Nashville Atlanta France Beijing Palm Beach Gardens Le Bourget Fort Lauderdale Singapore Brazil Singapore Gavião Peixoto Botucatu Australia Melbourne São José dos Campos Eugênio de Melo
- 26. Cash Intensiveness In the last 5 years the Company invested almost US$ 1 billion in research & development and productivity. 296 213 147 122 104 81 1996 1997 1998 1999 2000 2001
- 27. Cash Intensiveness US$ 1.3 Billion Investments in the Next 5 Years US$ millions 2002 2003 2004 2005 2006 2002-2006 Research & Development 213 191 180 174 176 934 Comercial 138 105 61 34 27 365 Corporate 15 6 2 2 2 27 Defense 51 72 109 130 139 501 Others 9 8 8 8 8 41 PP&E 118 71 59 50 51 349 TOTAL 331 262 239 224 227 1,283
- 28. Cash intensiveness Risk Sharing concept with partners allows the decrease in development cycle and investment risk Family launched in July 1999 Roll out in October 2001 First Flight in February 2002 31 months from launch to first flight
- 29. Cash Intensiveness In 2000 & 2001 Embraer increased its global presence in the International Capital Markets: July 2000: US$ 446 Million in Primary & Secondary Offerings June 2001: US$ 750 Million in a Secondary Offering
- 30. Flexibility
- 31. Flexibility Embraer has the agility and flexibility to adjust its production in accordance with market demand. ERJ 135/145 Deliveries
- 32. Flexibility New Delivery Forecast 160 161 145 135 96 59 32 4 1996 1997 1998 1999 2000 2001 2002 2003
- 33. Flexibility To cope with the new scenario, Embraer adjusted its total labor force and laid off 14% (1,800) of its employees. Total of Employees 11,048 10,334 8,302 6,737 6,087 4,319 4,494 3,849 1994 1995 1996 1997 1998 1999 2000 2001
- 34. Flexibility Flexibility incorporated into the production line allowed an increase in efficiency and decrease in production lead time Lead Time in Months 8.0 6.0 6.0 5.5 4.9 5.0 1996 1997 1998 1999 2000 2001
- 35. Flexibility Embraer presents one of the highest "revenue per employee" in the industry. Revenue per employee US$ thousand 307 242 247 254 172 101 1996 1997 1998 1999 2000 2001
- 37. Backlog US$23.1 billion in total orders, including US$ 10.3 billion in firm orders $30,0 $25,0 $20,0 $12,7 $12,7 $12,8 $15,0 $11,3 $10,0 $5,0 $11,4 $10,7 $10,3 $1,2 $6,4 $3,0 $4,1 $0,0 1996 1997 1998 1999 2000 2001 1Q02 Annual Growth 150% 36,7% 56,1% 78,1% (6,1)% (3,7)%
- 38. Net Sales US$ Million 3.500 2.922 3.000 2.757 2.500 2.000 1.841 1.500 1.344 1.000 756 500 - 1997 1998 1999 2000 2001
- 39. Gross Profit & Margin US$ Million 1.500 40% 38,6% 1.250 32,3% 1.127 31,3% 1.000 27,2% 27,8% 30% 862 750 595 500 20% 374 250 206 - 10% 1997 1998 1999 2000 2001
- 40. EBITDA & Margin US$ Million 1.200 30% 23,9% 1.000 21,5% 800 17,9% 20% 698 14,3% 600 493 9,3% 396 400 10% 193 200 71 - 0% 1997 1998 1999 2000 2001
- 41. Net Income & Net Margin US$ Million 600 15% 12,7% 500 11,6% 11,2% 10,8% 400 10% 321 328 300 233 200 5% 145 100 3 - 0% 1997 1998 1999 2000 2001