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Iochpe-Maxion - 4Q07 Presentation

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4th Quarter 2007 Presentation

Text of Iochpe-Maxion - 4Q07 Presentation

  • 1. Earnings Release 4Q07 / 2007 February, 2008

2. 4Q07/2007 February, 2008DISCLAIMER 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.2 3. 4Q07/2007 February, 2008SIMPLIFIED CORPORATE STRUCTURE Iochpe-Maxion S.A.Iochpe-50%100% Amsted-Maxion Fundio eAmsted- Maxion Sistemas AutomotivosEquipamentos Ferrovirios S.A.Ltda.R$ 79.5 million1 (24%)R$ 220.3 million1 (67%) Railway EquipmentsAutomotive ComponentsWheels and Chassis Division DivisionRailway freight cars: R$ 47.0 million1 (14%)Wheels: R$ 88.8 million1 (27%)Autoparts: R$ 28.7 milhes1 (9%)Castings: R$ 27.4 million1 (8%) and wheels: R$ 5.1 million1 (2%) Chassis: R$ 131.5 million1 (40%) 1Consolidated net revenue in the fourthquarter of 2007 3 4. 4Q07/2007February, 2008HIGHLIGHTS Consolidated net operating revenue of R$ 328.5 million in 4Q07 and R$ 1,289.2 in 2007, an increase of 23.9% and 3.3% respectively, over the same period of last year EBITDA(*) of R$ 35.2 million in 4Q07 and R$ 164.5 million in 2007, an increase of 47.8% and 1.1% respectively, over the same period of last year Net income of R$ 17.0 million in 4Q07 and R$ 72.4 in 2007, an increase of 1,129.0% and 25.1% respectively, over the same period of last year Net debt bank of R$ 128.3 million (R$ 132.3 million in Dec/06), or 0.8x EBITDA LTM(*) (0.8x in Dec/06) (*) 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.4 5. 4Q07/2007February, 2008 4Q07 MAIN DRIVERSGrowth of the Brazilian production of vehicles and agricultural machinery Recovery of domestic demand for railway freight carsImpact of the real appreciation (1.7665 4Q07 x 2.1499 4Q06) on net revenue of exports (reduction R$ 10.0 million) 5 6. Industry Performance 7. 4Q07/2007 February, 2008 LIGHT COMMERCIALS BRAZIL (000 units)= 18% 2 07CA GR 0 = 29% 6 = 8%2 0707 - 0 CA GR 0 07 06 = (6%) 408 3793663184Q07 06 = 20% 2161804Q07 0 6 = (7 %)156153 144114112 947240 3735 20022003200420052006 2007 4Q06 4Q07 Source: AnfaveaProduction Export 7 8. 4Q07/2007 February, 2008 TRUCKS BRAZIL (000 units) %07 = 15 R 02 CAG% 07 = 52= 29%R 02 07 06 CAG= 8%07 06 137 117 107106 06 = 37%4Q07 796 = 12% 69 4Q07 0 3941 3837 25 27 13111052002 2003 2004 200520062007 4Q064Q07 Source: Anfavea Production Export8 9. 4Q07/2007 February, 2008BUSES BRAZL (000 units)% = 11 07 R 02 CAG = 25% 0707 06 =15%R 02CAG07 06 =6 %393534 2927 %06 = 54 4Q07 23 19%06 = 2916 4Q07 15139 97 6 5 4 2002 2003 2004 200520062007 4Q064Q07 Source: Anfavea ProductionExport 9 10. 4Q07/2007February, 2008 AGRICULTURAL MACHINERY BRAZIL (000 units)2 07 = 5% CAGR 0 % = 41%07 = 2207 06CAGR 02 = 24%6907 06 65 5952 5346 3%6=64Q0709% 3131 06 = 3274Q0721 22 17 10 1185 20022003 2004 20052006 2007 4Q064Q07 Source: AnfaveaProductionExport 10 11. 4Q07/2007February, 2008 PASSENGER CARS BRAZIL (000 units)%02 07 = 9 CAGR0% 02 07 = 1CAGR 07 06 = 14%07 06 = (8%)2,389 2,0922,0091,757 %06 = 24 4Q07 1,521 1,505 4Q07 06 = (2%)684 635 633 586 497 513 440 363 147144 20022003 200420052006 2007 4Q064Q07 Source: Anfavea ProductionExport 11 12. 4Q07/2007 February, 2008RAILWAY FREIGHT CARS BRAZIL (units)% = 34 07 R 027,270CAG5,642 07 06 = (66%) 3,668= 132% 2,459 064Q07 1,249729 2943142002 2003 20042005 20062007 4Q06 4Q07 Production Source: Amsted Maxion estimate 12 13. 4Q07/2007 February, 2008MARKET SHARE BRAZIL (2007)Commercial Vehicles Railway Freight Railway ChassisWheels Cars Castings Maxion Maxion Maxion89% 80%67% Maxion61%21% 33% Dana12% 6% Borlem 20%11% OEMOthersOthers CruzaoMaxion66%57% 81%80% 2006Source: Maxion Estimate13 14. Financial and OperatingPerformance 15. 4Q07/2007February, 2008NET OPERATING REVENUE (R$ million) 6% 7=220 CA GR 0 07 06 = 3% 1,4941,248 1,2894 % 1,099 06 = 24Q07676 411329 26520022003 20042005200620074Q06 4Q07 15 16. 4Q07/2007February, 2008NET OPERATING REVENUE (R$ million) 1,2481,289 233Customer - 2007 (%) 257 Others 13.1% 1,056 Daimler 13.6%991Caterpillar 1.5%ALL 0,7%Scania 5.7% 20062007 MRS 4.4%CVRD 3.0% Domestic Export Volvo 2.0%Tractors 6.9% 1,248 1,289 90 115Volkswagen 16.8% 730896 Export 18.1%GMB 5.8%427279Ford 3.9%Fiat 4.5% 20062007 16Railway Wheels and Chassis Automotive Comp. 17. 4Q07/2007 February, 2008EXPORTS (USD million)1%07 06 = = 38% 072 GR0CA4Q07 119 12006 = (19)%96473332 24 262002 2003 2004 2005 20062007 4Q06 4Q07 17 18. 4Q07/2007 February, 2008EXPORTS (USD million) Segment Exports 2007 R$ 232.8 million (US$ 120.2 million)119120 01 Exports 4Q07 R$ 45.8 million (US$ 26.0 million) 56 56Destination - 2007 (%) Canada / Mexico 4.7%63 64 Africa & Middle East 16.2%2006 2007 Railway Wheels and Chassis Automotive Comp. 32026Europe 9.4%018 14 14 11 Latin America 23.1% 4Q06 4Q07USA 49.7% Railway Wheels and Chassis Automotive Comp.18 19. 4Q07/2007 February, 2008GROSS PROFIT (R$ million) 21%20%21%19%18% 18%16% 228289 13% 236 21913787 52 342002 2003 2004 2005 20062007 4Q064Q07Gross Profit % Net Sales19 20. 4Q07/2007February, 2008OPERATING INCOME EBIT (R$ million) 12% 12% 11%10%9%9% 1788% 127 136135 6% 5836 27172002200320042005 20062007 4Q06 4Q07EBIT % Net Sales 20 21. 4Q07/2007 February, 2008EBITDA* (R$ million)17% 14% 14%13% 13%13%11% 2059% 156 163 165 89 6935242002 20032004 20052006 20074Q06 4Q07 EBITDA% Net Sales (*) 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.21 22. 4Q07/2007February, 2008NET FINANCIAL EXPENSES (R$ million) 13%54 6%383733212% 2%3% 10 2% 50%1%-1 20022003200420052006 2007 4Q06 4Q07 Financial Exp.% Net Sales22 23. 4Q07/2007 February, 2008NET INCOME (R$ million)727258 51 5%5%6%5%5% 117-1% 1%(5)-6% (24) 200220032004200520062007 4Q06 4Q07 Net Income % Net Sales23 24. 4Q07/2007February, 2008NET BANK DEBT (R$ million)1.51.3 0.80.8 0.60.6 115132128106 102 125 2002 2003 2004 2005 20062007 Net Debt x EBITDA (*) 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. 24 25. 4Q07/2007February, 2008INDEBTEDNESS Dec/07 (R$ million) SHORT LONGLINESTOTAL TERM TERM Trade Finance / Export31.232.9 64.0 Equipment Finance / EXIM 100.6 115.2215.8131.8 148.0279.9(-) Cash & Marketable Securities 151.50.0 151.5Net Debt (19.7)148.0128.3Debt Indexation 79%Average Cost (Dec/07)Index by TJLP, CDI e IGPM in R$ 80% CDI3% 18%Index by Dollar in US$8.1% per year TJLP Dollar IGP-MAt the end of Dec 07, the company had contracted US$ 45.8 million of non-deliverable forward contractsat R$ 1.9852 average FX rate, for the period of Jan to Dec 08Forward positive impact to expire is not accounted, only the positive impact expiredAccording to Brazilian GAAP, if at any end of a month a negative future impact is foreseen on thecontracts, the full negative impact must be provisioned25 26. 4Q07/2007 February, 2008CAPEX (R$ million)84 736868 5441 222020022003 2004 2005 2006 2007 4Q06 4Q07 26 27. Capital Market 28. 4Q07/2007 February, 2008STOCKHOLDING RESTRUCTURING - SUBSEQUENT FACTA special shareholders meeting for holders of the Company`s preferred shares held on January 17, 2008 approved the conversion of Iochpe-Maxion's preferred shares into common shares at a conversion rate of 1.2 preferred shares for each common shareAn extraordinary general meeting of shareholders held on the same day approved the share conversion; it also approved a proposed amendment to the Companys bylaws, as well as the Companys migration to the Novo Mercado listings and the election of new members to the Companys board of directorsAfter the deadline of the shareholders right of withdrawal (02/20/08), will begin the process of the conversion of the preferred shares into common shares New Iochpe-Maxion Capital structure composed by common shares onlyBoard of Directors composed by at least 20% of independent members100% Tag Along in case of transfer of control 28 29. 4Q07/2007 February, 2008SHAREHOLDERS STRUCTURE Iochpe-

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