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Q4 & Full Year 2008/09 ResultsJune 24th, 2009
2
Disclaimer
This presentation contains forward-looking statements related to the prospects of our business and estimates for operating and financial results. Those related to growth prospects of Açúcar Guarani S.A. are merely projections and, as such, based exclusively on the expectations of the management concerning the future of the business. Such forward-looking statements depend substantially on changes in market conditions, government regulations, competitive pressures, the performance of the Brazilian and international economies and the industry and are therefore subject to change without prior notice.
0
200
400
600
800
Q1
07/0
8
Q2
07/0
8
Q3
07/0
8
Q4
07/0
8
Q1
08/0
9
Q2
08/0
9
Q3
08/0
9
Q4
08/0
9
3
Expected deficit of global sugar market in 2009 world crop primarily linked to India’s decreased level of production and EU imports
Increase of sugar prices and upward trend in second half
Strong depreciation of the BRL versus the US dollar since September, 2008
Sugar Market Overview in 2008/09
Guarani’s Sugar Average Prices (R$/ton)
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800
Q1
07/0
8
Q2
07/0
8
Q3
07/0
8
Q4
07/0
8
Q1
08/0
9
Q2
08/0
9
Q3
08/0
9
Q4
08/0
9
4
Increase of 14.6% in Brazilian ethanol consumption to 20.1 billion liters driven by record sales of flex fuel vehicles
Growing ethanol prices during most part of the crop
Fall in prices in the inter-harvest period (4th quarter)
World ethanol market:decrease in prices due to slump in oil prices and credit crunch
Ethanol Market Overview in 2008/09
Guarani’s Ethanol Average Prices (R$/m³)
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13.7% increase in volume of sugarcane crushed in 2008/09
Sugarcane Crushed (MM t)
4.1 4.1
8.6 10.3
2007/08 2008/09
Own 3rd Party
14.412.7
Increase mainly due to:
São José plant: +0.4 million tonnes
Tanabi plant: +0.8 million tonnes
Strategy of third party suppliers proved timely in context of credit crisis
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Record Ethanol Production in 2008/09 and Stable Sugar Production
Ethanol Production (‘000 m³)
Sugar Production (‘000 t)
601 565
564 592
2007/08 2008/09
Refined Non-Refined
1.165 1.157-0.7%
77 111
318385
2007/08 2008/09Anhydrous Hydrous
496395
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Net Revenue (R$ MM)1
Growth in net revenue driven by:
Increased sales: sugar (+4.6%) and ethanol (+39.0%)
Average increase in prices in Reais: sugar (+20.1%) and ethanol (+6.7%)
519.6 R$/ton, a growth of 13.6%
Guarani’s Net Revenue breakdown was:
Sugar: 60.6%
Ethanol: 32.2%
Other products: 7.2%
Record Net Revenue of R$ 1.2 billion Driven by Higher Prices and Increased Volumes in 2008/09
565 709
25437887
84
2007/08 2008/09Sugar Ethanol Others
9061,171
(1) 2007/08 figures have been reclassified and changed due to law 11638/07, as compared to figures previously disclosed.
157228
17.3%
19.5%
16,0%
18,0%
20,0%
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200
250
2007/08 2008/09
Adjusted EBITDA Adjusted Margin
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Sharp increase of Adjusted EBITDA (+45.6%) because of higher sugar and ethanol prices
Adjusted EBITDA margin of 19.5% versus 17.3% in 2007/08
Adjusted EBITDA measured per volume of TRS sold of 109.1 R$/ton in 2008/09, as compared with 87.6 R$/ton in 2007/08 (+24.5%)
45.6% increase in Annual Adjusted EBITDA to R$228.3 Million
Adjusted EBITDA (R$ MM)1
(1) 2007/08 figures have been reclassified and changed due to law 11638/07, as compared to figures previously disclosed.
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364.9%
11.1%
2,0%
4,0%
6,0%
8,0%
10,0%
12,0%
0
5
10
15
20
25
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35
40
4Q 07/08 4Q 08/09Adjusted EBITDA Adjusted Margin
9
Adjusted EBITDA (R$ MM)1
Adjusted EBITDA: R$35.8 million (+241%) compared to Q4 07/08
Lower than Q3 08/09, impacted by normal business model cycle (third party sugarcane suppliers), with CONSECANA adjustments and inter-harvest costs and expenses effects
Q4 Adjusted EBITDA: R$35.8 Million, +241%
Adjusted EBITDA Margin1
(1) 2007/08 figures have been reclassified and changed due to law 11638/07, as compared to figures previously disclosed.
0%
10%
20%
30%
40%
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
06/07 07/08 08/09
10
Adjusted Net Result (R$ MM)1
Net Loss: R$291.0 million in 2008/09, compared with a net loss of R$46.6 million in the prior year
Net loss impacted mainly by:
Non-cash effect of the Real depreciation in relation to the US Dollar (R$278.9 million)
Non-cash effect of the amortization of goodwill resulting from the acquisition of share capital in Andrade, Tanabi and Sena plants (R$96.2 million)
High financial expenses due to higher interest rates on short-term debts, specially in Q4. Capital increase to positively impact on financial expenses
Net Result impacted by the Real Depreciation
35
(11)
2007/08 2008/09
(1) 2007/08 figures have been reclassified and changed due to law 11638/07, as compared to figures previously disclosed.
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R$238.8 million capital increase strengthened Guarani’s balance sheet and cash position to R$397.7 million at the end of March, 09
Short-term debt net of cash and cash-equivalents totaled R$144.3 million, down 63.4% versus R$393.8 million at December, 08
Guarani successfully renegotiated contracts and contracted new MT loans
Net Debt/Adjusted EBTIDA ratio fell to 4.4x in March, 09 versus 6.2x in December, 08. Excluding intercompany loans, Net Debt/Adjusted EBITDA ratio stood at 2.2x
Net Debt Reduced by 20.5% to R$1.0 Billion at March 31, 2009
Net Debt per Term1
Net Debt per Currency1
Foreign Currency
77%
BRL23%
(1) Excluding Intercompany Loans
Current28%
Non-Current
72%
(1) Including R$124.4 million related to the Mozambique plant
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CAPEX: Focus on Cost Reduction, Efficiency and Sugarcane Plantations
Q4 CAPEX (R$ MM)1
Strong discipline on CAPEX reduction
Focus on plantation CAPEX to ensure adequate raw material availability and productivity
Selective CAPEX to eliminate bottlenecks and further develop marginal capacity to lower fixed costs (São José and Tanabiplants)
Annual CAPEX (R$ MM)1
302
66
66
30
4Q 07/08 4Q 08/09
PPE Planting
368
96
677
172
95
108
2007/08 2008/09
PPE Planting
772
280
1) CAPEX does not consider maintenance.
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Global deficit will continue to drive increase in sugar prices as India’s production should recover slowly in the next two crop seasons
Stable growth in global demand, not affected by crisis
Return to equilibrium expected in 2010/2011 when Indian production should be re-established (ISO)
Domestic market: Increased production and export levels expected in 2009/10
Sugar Market: Positive Trend for 2009/10 Crop
Raw Sugar Prices (NY 11)
World Sugar Balance
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Ethanol Market: FFV Sales and Ethanol Consumption Still Increasing
Vehicles Sales by Fuel Type (Brazil)
Domestic Market
Sustained demand for ethanol due to attractive ratio between ethanol and gasoline prices at the pump
Ethanol production in 2009/10 crop expected to increase although growth rate impacted by higher production of sugar
International Market
Outlook for ethanol prices in the short term is stable with a slight increase in the beginning of the US summer
Europe remains a net importer of ethanol despite increases in production
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Outlook: Guarani Solidly Positioned for 2009/10 to Overcome Financial Market Turmoil and Seize Opportunities
Mix concentrated on sugar production to allow Guarani to take advantage of the upturn in sugar prices
Sustained demand for ethanol due to attractive ratio between ethanol and gasoline prices at the pump. Opportunities to export to US Market
Potential to further improve synergies between plants
Partnership with Tractebel in Andrade plant to start operation from beginning of 2010 and provide stable cash generation
Reduction in financial expenses due to capital increase and new MT loans
Continued focus on balance sheet strengthening
Strong commitment and support from Tereos, Guarani’s controlling shareholder
Thank You!
Reynaldo F. BenitezCFO and Investor Relations Officer
Alexandre L. MenezioInvestor Relations Manager
Felipe F. MendesInvestor Relations Analyst
Renato N. Zanetti NetoInvestor Relations Analyst
Leonardo T. GoesInvestor Relations Intern
phone: +55 (11) 3544-4900
e-mail: [email protected]
website:www.acucarguarani.com.br/ir
