iochpe-maxion - conference call 1q06 results presentation
DESCRIPTION
Conference Call 1Q06 Results PresentationTRANSCRIPT
1
ResultsFirst Quarter 2006
May 5, 2006
ResultsFirst Quarter 2006ResultsFirst Quarter 2006
2
ResultsFirst Quarter 2006
DISCLAIMERDISCLAIMER
The material contained in this presentation is general background information about Iochpe-Maxion S.A. (Iochpe) as of the date of the presentation. It is information in summary form and does not purport to be complete. It is not intended to be relied upon as advice to potential investors. No representation or warranty, express or implied, is made concerning, and no reliance should be placed on, the accuracy, fairness, or completeness of the information presented herein.
This presentation contains statements that are forward-looking within the meaning of Section 27A of the U.S. Securities Act of 1933 and Section 21E of the U.S. Securities Exchange Act of 1934. Such forward-looking statements are only predictions and are not guarantees of future performance. Investors are cautioned that any such forward-looking statements are and will be, as the case may be, subject to many risks, uncertainties and factors relating to the operations and business environments of Iochpe and its subsidiaries that may cause the actual results of the companies to be materially different from any future results expressed or implied in such forward-looking statements.
Although Iochpe believes that the expectations and assumptions reflected in the forward-looking statements are reasonably based on information currently available to Iochpe management, Iochpe cannot guarantee future results or events. Iochpe expressly disclaims a duty to update any of the forward-looking statement.
This presentation does not constitute an offer, or invitation, or solicitation of an offer, to subscribe for or purchase any securities. Neither this presentation nor anything contained herein shall form the basis of any contract or commitment whatsoever.
3
ResultsFirst Quarter 2006
1Q06 HIGHLIGHTS1Q06 HIGHLIGHTS
(*) EBITDA, throughout this presentation means: net income plus income tax and social contribution, plus non-operating result, plus net financial expenses, plus depreciation and amortization, plus goodwill amortization.
Net income of R$14.9 million, 1.4% less than 1Q05;
Consolidated net operating revenue of R$340.3 million, 3.5% decrease over 1Q05;
EBITDA(*) reached R$44.7 million, 6.4% decrease over 1Q05;
Net bank debt of R$150.8 million (R$157.8 million in 1Q05), or 0.7x LTM EBITDA(*) (0.9x in 1Q05)
Industry Performance
5
ResultsFirst Quarter 2006
LIGHT COMMERCIALS – BRAZIL (‘000 units)LIGHT COMMERCIALS – BRAZIL (‘000 units)
Source: Anfavea
216180
216
318366
80 9056 40
72114
156
32 35
2001
2002
2003
2004
2005
1Q05
1Q06
Production
ExportCAGR 01 – 05 = 14%
∆ 1Q06 - 05 = 13%
∆ 1Q06 – 05 = 8%
CAGR 01 – 05 = 29%
6
ResultsFirst Quarter 2006
TRUCKS – BRAZIL (‘000 units)TRUCKS – BRAZIL (‘000 units)
Source: Anfavea
77 6979
107 116
28 242537
7 7,47 513
2001
2002
2003
2004
2005
1Q05
1Q06
Production
Export
CAGR 01 – 05 = 11%
CAGR 01 – 05 = 54%
∆ 1Q06 – 05 = (12%)
∆ 1Q06 – 05 = 5%
7
ResultsFirst Quarter 2006
BUSES – BRAZIL (‘000 units)BUSES – BRAZIL (‘000 units)
Source: Anfavea
24 2327 29
35
8.2 8.67 7 913
19
3.64
2001
2002
2003
2004
2005
1Q05
1Q06
Production
ExportCAGR 01 – 05 = 11%
CAGR 01 – 05 = 29%
∆ 1Q06 – 05 = (8%)
∆ 1Q06 – 05 = 6%
8
ResultsFirst Quarter 2006
AGRICULTURAL MACHINERY – BRAZIL (‘000 units)AGRICULTURAL MACHINERY – BRAZIL (‘000 units)
Source: Anfavea
4452
5969
53
14 118 1021
31 315
8
2001
2002
2003
2004
2005
1Q05
1Q06
Production
ExportCAGR 01 – 05 = 4%
CAGR 01 – 05 = 39%
∆ 1Q06 – 05 = (35%)
∆ 1Q06 – 05 = (18%)
9
ResultsFirst Quarter 2006
PASSENGER CARS – BRAZIL (‘000 units)PASSENGER CARS – BRAZIL (‘000 units)
Source: Anfavea
1,496 1,521 1,5051,757
1,931
470 509319 363 440 497 606 155148
2001
2002
2003
2004
2005
1Q05
1Q06
Production
ExportCAGR 01 – 05 = 7%
CAGR 01 – 05 = 17%
∆ 1Q06 – 05 = 5%∆ 1Q06 – 05 = 8%
10
ResultsFirst Quarter 2006
Source: Amsted Maxion estimate
RAILWAY FREIGHT CARS – BRAZIL (units)RAILWAY FREIGHT CARS – BRAZIL (units)
748
2,459
5,642
7,270
1,375 1,309294
2001
2002
2003
2004
2005
1Q05
1Q06
Sale
CAGR 01 – 05 = 77%
∆1Q06 – 05 = (5%)
11
ResultsFirst Quarter 2006
Source: Amsted Maxion estimate
RAILWAY CASTINGS – BRAZIL (metric tons)RAILWAY CASTINGS – BRAZIL (metric tons)
3.500
2.288
3.386
5.100
1.046 733
2.230
2001
2002
2003
2004
2005
1Q05
1Q06
Sale
CAGR 01 – 05 = 10%
∆ 1Q06 – 05 = (30%)
Does not include castings used in the assembly of railway freight cars
12
ResultsFirst Quarter 2006
Source: Amsted Maxion estimate
RAILWAY WHEELS – BRAZIL ( ‘000 units)RAILWAY WHEELS – BRAZIL ( ‘000 units)
4250
4248
9 11
50
2001
2002
2003
2004
2005
1Q05
1Q06
Sale
CAGR 01 – 05 = 4%
∆ 1Q06 – 05 = 19%
Does not include wheels used in the assembly of railway freight cars
13
ResultsFirst Quarter 2006
MARKET SHARE – BRAZIL (1Q06)MARKET SHARE – BRAZIL (1Q06)
ChassisChassisCommercialCommercial VehicleVehicle
WheelsWheelsRailway Railway FreightFreight
CarsCars
RailwayRailwayCastingsCastings
Source: Maxion estimate
71%
28%1%
Maxion
Dana
OEM
58%
39%
3%
Maxion
Borlem
Others
85%
15%
Maxion
Others
80%
20%
Maxion
Cruzaço
MaxionMaxion
1Q051Q0569%69% 65%65% 80%80% 80%80%
Consolidated Results
15
ResultsFirst Quarter 2006
Amsted Maxion (*) Wheels and
Chassis Division
Automotive Comp.Division
Segment (%) Customer (%)
(*) Consolidation considers 50% of Amsted Maxion’s net operating revenue
R$ 340 R$ 340 millionmillion
NET OPERATING REVENUE – 1Q06NET OPERATING REVENUE – 1Q06
41%
6%
53%
19%
12%
11%
10%
6%4%
4%3%
19%
12%
Other
DaimlerChryslerVolks-
wagen
GeneralMotors
CVRD/FCA
Ford
BrasilFerrovias
Tractors
Scania
Exports
16
ResultsFirst Quarter 2006
50%
8%
10%6%
26%
USA
Africa/Middle EastEuropeChassis
CommercialVehicleWheels
RailwayEquip.
Segment (%) Destination (%)
Canada/ Mexico
SouthAmerica
EXPORTS – 1Q06EXPORTS – 1Q06
US$29 US$29 millionmillion
R$63 R$63 millionmillion
63%
30%
7%
17
ResultsFirst Quarter 2006
NET OPERATING REVENUE (R$ million)NET OPERATING REVENUE (R$ million)
374
676
1,099
1,494
353 340411
2001
2002
2003
2004
2005
1Q05
1Q06
∆ 05-04 = 36%
CAGR 01 – 05 = 41%
∆ 1Q06 – 05 = (4%)
18
ResultsFirst Quarter 2006
EXPORTS (USD million)EXPORTS (USD million)
24
47
96
232933
24
2001
2002
2003
2004
2005
1Q05
1Q06
∆ 05-04 = 61%
CAGR 01 – 05 = 48%
∆ 1Q06 – 05 = 29%
19
ResultsFirst Quarter 2006
GROSS PROFITGROSS PROFIT
80 87
137
228
72 64
28921% 21% 20% 20% 19%19%21%
0
50
100
150
200
250
300
350
2001
2002
2003
2004
2005
1Q05
1Q06
0%
10%
20%
30%
40%
50%R$ MM % net sales
20
ResultsFirst Quarter 2006
EARNING BEFORE INTEREST AND TAXES - EBITEARNING BEFORE INTEREST AND TAXES - EBIT
27 3658
127
178
41 38
7%
9% 9%
12% 12% 12%11%
0
50
100
150
200
2001
2002
2003
2004
2005
1Q05
1Q06
0%
5%
10%
15%
20%R$ MM % net sales
21
ResultsFirst Quarter 2006
NET FINANCIAL EXPENSESNET FINANCIAL EXPENSES
41
54
38 37
9 6
33
11%
13%
6%
3%
2%
3%
2%
0
25
50
75
2001
2002
2003
2004
2005
1Q05
1Q06
0%
5%
10%
15%R$ MM % net sales
22
ResultsFirst Quarter 2006
(*) EBITDA, throughout this presentation means: net income plus income tax and social contribution, plus non-operating result, plus net financial expenses, plus depreciation and amortization, plus goodwill amortization.
EBITDA (*)EBITDA (*)
58 6989
156
205
48 45
16%17%
13%14% 14% 14%
13%
0
50
100
150
200
250
2001
2002
2003
2004
2005
1Q05
1Q06
0%
5%
10%
15%
20%R$ MM % net sales
23
ResultsFirst Quarter 2006
NET EARNINGSNET EARNINGS
25
72
1515
51
(5)(24)
7%
-6%
-1%
5% 5%4% 4%
(40)
(20)
0
20
40
60
80
2001
2002
2003
2004
2005
1Q05
1Q06
-10%
-5%
0%
5%
10%
15%
20%R$ MM % net sales
24
ResultsFirst Quarter 2006
(*) EBITDA, throughout this presentation means: net income plus income tax and social contribution, plus non-operating result, plus net financial expenses, plus depreciation and amortization, plus goodwill amortization.
R$ MM x EBITDA (*)
NET BANK DEBTNET BANK DEBT
65
125
151158
102
115106
1.1
1.5
1.3
0.6 0.6
0.9
0.7
0
25
50
75
100
125
150
175
200
2001
2002
2003
2004
2005
1Q05
1Q06
0.0
0.5
1.0
1.5
2.0
25
ResultsFirst Quarter 2006
CAPEX (R$ million)CAPEX (R$ million)
41
7384 80
13 14
54
2002
2003
2004
2005
2006
E1Q
051Q
06
26
ResultsFirst Quarter 2006
INCOME STATEMENT (R$ thousand)INCOME STATEMENT (R$ thousand)
(*) EBITDA, throughout this presentation means: net income plus income tax and social contribution, plus non-operating result, plus net financial expenses, plus depreciation and amortization, plus goodwill amortization.
2,006 % N.O.R. 2,005 % N.O.R. Var%Net operating revenue 340,321 100.0% 352,579 100.0% -3.5%
(-) Cost of goods sold (276,483) -81.2% (281,082) -79.7% -1.6%
Gross profit 63,838 18.8% 71,497 20.3% -10.7%
Operating expensesSales (14,708) -4.3% (17,238) -4.9% -14.7%General and Administrative (11,505) -3.4% (12,202) -3.5% -5.7%Other operating expenses 58 0.0% (807) -0.2% -107.2%
(26,155) -7.7% (30,247) -8.6% -13.5%
Earnings before interest and taxes - EBIT 37,683 11.1% 41,250 11.7% -8.6%
Net financial expenses (6,162) -1.8% (8,700) -2.5% -29.2%
Earnings after financial expenses 31,521 9.3% 32,550 9.2% -3.2%
Non-operating result (5,106) -1.5% (5,284) -1.5% -3.4%
Earnings before taxes 26,415 7.8% 27,266 7.7% -3.1%
Income taxes (11,511) -3.4% (12,151) -3.4% -5.3%
Net income 14,904 4.4% 15,115 4.3% -1.4%
EBITDA (*) 44,666 13.1% 47,724 13.5% -6.4%
First Quarter
Additional Information
28
ResultsFirst Quarter 2006
BALANCE SHEET (R$ thousand)BALANCE SHEET (R$ thousand)
ASSETS Mar ´06 Mar ´05 LIABILITES AND EQUITY Mar ´06 Mar ´05
CURRENT CURRENT Cash and marketable securities 22,639 30,287 Loans 113,814 144,965 Receivables 186,422 180,713 Payables 64,501 73,969 Inventories 131,822 160,479 Costumers advances 51,984 69,558 Recoverable taxes 18,895 26,648 Wages and charges 29,507 25,403 Other 28,077 18,833 Taxes 9,360 23,601
387,855 416,960 Provisions 7,869 15,067 Other 12,648 36,820
289,683 389,383
LONG TERM LONG TERM Receivables 2,832 4,533 Loans 59,625 42,148 Deferred income taxes 28,945 40,090 Provisions 62,601 36,918 Other 13,762 29,872 Other 14,865 4,246
45,539 74,495 137,091 83,312
MINORITY INTEREST 195 176
PERMANENT EQUITY Investments 369 265 Paid-up capital 161,463 161,463 Plant, property and equipment 235,540 178,763 Profit reserves 68,468 24,770 Deferred items 2,501 3,736 Retained earnings 14,904 15,115
238,410 182,764 244,835 201,348
671,804 674,219 671,804 674,219
29
ResultsFirst Quarter 2006
NET DEBT BREAKDOWN – MAR ‘06 (R$ million)NET DEBT BREAKDOWN – MAR ‘06 (R$ million)
TotalTotal
127.2127.2
42.942.9
3.33.3
22.622.6
150.8150.8
LongLong TermTerm
44.644.6
15.015.0
59.659.6
Short Short TermTerm
82.682.6
27.927.9
3.33.3
22.622.6
91.291.2
LinesLines
EquipmentEquipment financingfinancing
TradeTrade FinanceFinance / / ExportExport
((--) ) CashCash andand CashCash equivalentsequivalents
Net Net DebtDebt
Other lines Other lines in R$in R$
173.4173.459.659.6113.8113.8
30
ResultsFirst Quarter 2006
71%
25%2%2% Dollar
IGPM(whosale inflation
index)
TJLP(BNDESrate)
DEBT INDEXATION – MAR ‘06 (%)DEBT INDEXATION – MAR ‘06 (%)
AverageAverage CostCost (1Q06)(1Q06)
In US$In US$
In R$In R$
7.8% p.a.7.8% p.a.
71% CDI71% CDI
Interbank rate
31
ResultsFirst Quarter 2006
FREIGHT CARS – FIRM ORDERS FOR DELIVERY IN 2006 FREIGHT CARS – FIRM ORDERS FOR DELIVERY IN 2006
Brasil FerroviasBrasil Ferrovias
CVRD / FCACVRD / FCA
720 720 unitsunits
1,276 1,276 unitsunits
MRSMRS
MRC (MRC (MitsuiMitsui / / BungeBunge / ALL)/ ALL)
280 280 unitsunits
300 300 unitsunits
TotalTotal
CVG CVG FerromineraFerrominera OrinocoOrinoco
2,695 2,695 unitsunits
50 50 unitsunits
RevenueRevenue ApproxApprox..R$510 R$510 millionmillion
ItaItaúú Leasing (Leasing (Inlogs Inlogs / ALL)/ ALL) 69 69 unitsunits
32
ResultsFirst Quarter 2006
SHAREHOLDER COMPOSITION : MAR ´06 SHAREHOLDER COMPOSITION : MAR ´06
Iochpe Iochpe FamilyFamily BNDES ParticipaBNDES Participaçõçõeses OtherOther
IssuedIssued SharesShares (*)(*)
CommonCommon
PreferredPreferred
TotalTotal
18,428,59718,428,597
34,803,70734,803,707
53,232,30453,232,304
34.62%34.62%
65.38%65.38%
100.00%100.00%
VotingVotingNonNon--VotingVoting
TotalTotal
74.6%74.6%0.4%0.4%
26.1%26.1%
VotingVotingNonNon--VotingVoting
TotalTotal
21.8%21.8%27.6%27.6%25.6%25.6%
VotingVotingNonNon--VotingVoting
TotalTotal
3.6%3.6%72,0%72,0%48.3%48.3%
33
ResultsFirst Quarter 2006
(*) after reverse split
STOCK PERFORMANCESTOCK PERFORMANCE
43
1,385
171 123 139253 205 183
1,366
381
849
262144 156
296 289556
333
1,004
303 384
966
3,225
2,388
354401190151
16.3
14.214.1
12.4
9.6
8.58.7
6.85.5
4.13.94.04.04.74.9
4.0
16.0 15.915.5
13.614.2
16.2 16.2
14.4
16.8
21.1
18.818.0
-
500
1,000
1,500
2,000
2,500
3,000
3,500
4,000
4,500
5,000
Dec-0
3Ja
n-04
Feb-
04Mar
-04
Apr-
04May
-04
Jun-
04Ju
l-04
Aug-
04Se
p-04
Oct-0
4Nov
-04
Dec-0
4Ja
n-05
Feb-
05Mar
-05
Apr-
05May
-05
Jun-
05Ju
l-05
Aug-
05Se
p-05
Oct-0
5No
v-05
Dec-0
5Ja
n-06
Feb-
06Mar
-06
-
4.0
8.0
12.0
16.0
20.0
24.0DAILY VOLUME / MONTHLY AVERAGE PRICE
IOCHPE-MAXION PN (MYPK4)
R$ THOUS. R$ / SHARE (*)
PRICE
VOLUME