2Q 2012 Results

August 14th, 2012

SCHEDULE

HIGHLIGHTS

RESULTS

OUTLOOK

2

Providência USA

Providência USA

HIGHLIGHTS 2Q 2012

The startup, in June 4th 2012, of the second production line at the Pouso

Alegre facility in the state of Minas Gerais;

Work on the project for expanding the Statesville (NC) facility in the US is

running to schedule – our 13rd Production Line ;

By year-end 2012, Providência’s capacity will have reached 140 thousand

tons/year, reaffirming the Company’s ranking as one of the major players in the

nonwovens industry;

Payout of R$ 25.4 million on May 25 of the remaining balance in dividends for

fiscal year 2011, totaling R$ 39.5 million. 3

SCHEDULE

HIGHLIGHTS

RESULTS

OUTLOOK

4

38.5 43.6

3.5

4.0

1H11 1H12

47.7

42.0

19.9 21.3 22.3

2.1 1.8 2.3

22,0 23,1

24,6

2Q11 1Q12 2Q12

Nonwovens Others

24.6 23.1

22.0

The increase was mainly due to the

first production line of the United

States, that started up in January/2011.

During the quarter, the Company

reported an increase in total Sales Volume

of 11.6% compared with the same period in

2011;

SALES VOLUME (in thousands of tons)

5

Net Revenue increased 19.1% in

relation to the 2Q11, and 8.3%

comparing to the 1Q12;

241.9

290.5

-

20,0

40,0

60,0

80,0

100,0

120,0

140,0

160,0

180,0

200,0

220,0

240,0

260,0

280,0

300,0

1H11 1H12

126.8 139.4 151.0

2Q11 1Q12 2Q12

NET REVENUE (in millions of Reais)

6

This increase is mainly related to the

increase in Sales Volume and price

realignment as well as the devaluation of

the Real.

The increase of 14.4% compared with 2Q12 is mainly a reflection of the higher Sales

Volume in 2Q12, given that unit COGS posted a rise of only 2.5%, impacted by rising prices in

the Company’s principal cost component, polypropylene.

94.5 96.6 108.1

R$ 4.29 R$ 4.18

R$ 4.40

R$ 2,50

R$ 3,50

-

20,0

40,0

60,0

80,0

100,0

120,0

140,0

160,0

180,0

200,0

2Q11 1Q12 2Q12

173.6

204.7

R$ 4.14 R$ 4.29

2

3

4

-

20,0

40,0

60,0

80,0

100,0

120,0

140,0

160,0

180,0

200,0

1H11 1H12

COGS (Cost of Goods Sold) (in millions of Reais)

7

18.1

28.9 28.2

14.3%

20.7%

18.7%

0,0% -

20,0

40,0

60,0

2Q11 1Q12 2Q12

40.2

57.1

16.6%

19.7%

0 0,0

20,0

40,0

60,0

1H11 1H12

EBITDA (in millions of Reais) and EBITDA MARGIN (%)

8

Adjusted EBITDA in 2Q12 reached R$ 28.2 million, a growth of 55.8% when compared

with R$ 18.1 million reported in 2Q11 and Adjusted EBITDA margin rose 4.4 p.p. in the

same period;

The EBITDA increase was mainly due to the higher Sales Volume and to the prices recovery.

9.5

14.9

3.9%

5.1%

0,0% -

1H11 1H12

Net Income totaled R$ 7.8 million in

2Q12, an increase of 11.1% comparing to

the 1Q12 and 237.1% in relation to the

2Q11;

2.3

7.1 7.8

1.8%

5.1% 5.2%

0,0% -

2Q11 1Q12 2Q12

NET INCOME (in millons of Reais) and NET MARGIN(%)

25,0

9

Calculation base for the annually adjusted

dividends for the quarter (retained profits) reached

R$ 10.4 million, since the realization of the deemed

cost in the quarter, net of tax, is added.

218.8

93.0 63.7

-

50,0

100,0

150,0

200,0

250,0

2Q11 1Q12 2Q12

Total

CASH AND CASH EQUIVALENTS (in millions of Reais)

10

In 1H12, the Company reported operational cash generation of R$ 79.0 million, 60.2%

higher than for 1H11, due to the performance of the plant in the United States which began to

generate an operational cash flow from the middle of the 2H11 and to the success of the work

involved in reducing the need for working capital.

In 2Q12 the Company reported a decrease in Cash and Cash Equivalents, comparing to

2Q11 and 1Q12, due to investments in the new production lines in Brazil and the United

States and the payout of R$ 25.4 million in dividends;

258.3

355.3

403.1

50,0

100,0

150,0

200,0

250,0

300,0

350,0

400,0

2Q11 1Q12 2Q12

NET DEBT (in millions of Reais)

Net Debt increased 56.0% when compared

with 2Q11 mainly due to new investments

coming on stream during the course of the

year and to the foreign exchange translation

effect on dollar-denominated debt;

The foreign currency named debt was

mainly borrowed in the USA with a natural

hedge in the form of Providência’s revenue

flows and assets in that country.

11

Local Currency

36%

64%

Foreign Currency

DEBT / CASH (in millions of Reais)

Consolidated Net Debt

12

R$ (MM) 06/30/2011 06/30/2012 Ch. 2Q12 /

2Q11

Total Debt

Short Term 260.0 117.7 -54.7% Long Term 217.1 349.2 60.8%

Total 477.2 466.8 -2.2%

Cash 218.8 63.7 -70.9%

Net Debt 258.3 403.1 56.0%

Shareholders' Equity 685.1 678.7 -0.9% Net Debt / Adjusted EBITDA 3.0 3.7 22.7% Net Debt / Adjusted EBITDA without the lines that startup in 2012 Debt

2.9 2.6 -9.1%

5.25% 5.54%

8.06%

2009 2010 2011

Dividend Yield*

MARKET VALUE RATIOS

0.70 0.80 0.74

-

0,20

0,40

0,60

0,80

1,00

1,20

1,40

1,60

1,80

2,00

2Q11 1Q12 2Q12

25,0

13

Share Price / Book Value per Share

* Dividend per Share / Share price at the end of the period.

HIGHLIGHTS

RESULTS

OUTLOOK

SCHEDULE

OUTLOOK

15

The 2nd production line at the Pouso Alegre plant – the Company’s 12th - inaugurated in

June 2012, is expected to reach full capacity during the course of 4Q12 with a

corresponding increase in Sales Volume. This unit will ramp up Providência’s capacity by 20

thousand tons annually, production largely going to the disposable hygienic goods market;

During the 4th quarter of 2012 we will startup on schedule the 13th production line – the

second at the Statesville (NC) plant, so increasing our production capacity in the United

States from 20 to 40 thousand tons/year;

By year-end 2012, Companhia Providência’s capacity will have reached 140 thousand

tons/year, reaffirming the Company’s ranking as one of the major players in the global

nonwovens industry.

CEO: Hermínio V. S. de Freitas CFO: Eduardo Feldmann Costa IR : Gabriela Las Casas Beatriz Tokarski Tel: +55 (41) 3381-8673 Fax: +55 (41) 3283-5909 São José dos Pinhais – PR www.providencia.com.br/ir www.twitter.com/providencia_ri

The words “believe”, “anticipate”, “expect”, “estimate”, “will”, “plan”, “may”, “intend”, “foresee”, “project” and other similar expressions indicate forward-looking statements. These forward-looking statements involve uncertainties, risks and assumptions, since they include information related to our potential or assumed future operating results, business strategy, financing plans, competitive position in the market, industry environment, potential growth opportunities and the effects of future regulations and competition. In addition, forward-looking statements refer only to the date on which they were made and should not be taken as a guarantee of future performance. Providência is under no obligation to update this presentation with new information and/or future events .