Download - Iochpe-Maxion - 2008 Results Presentation
February, 2009
EARNINGS RELEASE – 4Q08 / 2008EARNINGS RELEASE – 4Q08 / 2008
2
4Q08 / 2008
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
4Q08 / 2008
50% 100%
IochpeIochpe--Maxion S.A.Maxion S.A.
AmstedAmsted--Maxion Fundição e Maxion Fundição e Equipamentos Ferroviários S.A.Equipamentos Ferroviários S.A.
Railway Freight Cars: R$ 67.2 million1 (15%)
Castings: R$ 44.3 million1 (10%)
Railway Wheels: R$ 9.7 million1 (2%)
Wheels: R$ 137.5 million1 (30%)
Chassis: R$ 183.8 million1 (40%)
R$ 19.5 million1 (4%)R$ 121.2 million1 (26%) R$ 321.3 million1 (70%)
100%
Structural Stamped Parts: R$ 3.2 million1 (1%)
Hand Brake Leaver and Pedal Sets: R$ 6.5 million1 (1%)
SIMPLIFIED CORPORATE STRUCTURESIMPLIFIED CORPORATE STRUCTURE
Wheels and Chassis DivisionWheels and Chassis DivisionAutomotive Components Automotive Components
DivisionDivision
1 Consolidated net operating revenue in the
fourth quarter of 2008
4
4Q08 / 2008
� Consolidated net operating revenue of R$ 462.0 million in the 4Q08 and R$ 1,827.7 in 2008, an increase of 40.7% e 41.8% respectively, over the same period of last year
� EBITDA(*) of R$ 46.0 million in the 4Q08 and R$ 267.7 in 2008, an increase of 34.3% and 71.7% respectively, when compared to the same period of last year
� Net income of R$ 4.9 million in the 4Q08 and R$ 214.1 in 2008, a reduction of 71.3% in the quarter and an increase of 195.7% in the year, when compared to same period of last year
� Net bank debt of R$ 255.5 million (R$ 128.3 million in Dec/07) or 1.0x LTM EBITDA (0.8x in Dec/07)
(*) EBITDA, ao longo desta apresentação significa: lucro líquido mais imposto de renda e contribuição social, mais resultado nãooperacional, mais despesas financeiras líquidas, mais depreciação e amortização, mais amortização de ágio.
HIGHLIGHTSHIGHLIGHTS
5
4Q08 / 2008
� Reduction of Brazilian production of passenger cars, light commercial vehicles and buses
� Reduction of the growth rhythm of Brazilian production of trucks and agricultural machinery
� Reduction of the growth rhythm of domestic demand for railway freight cars
� Essential adjustments to reduce costs, due to the international economic crisis
� Impact of the Real depreciation over the loans in foreing currency and over the operations to
fix the future value of the dollar (NDFs)
4Q08 – MAIN DRIVERS4Q08 – MAIN DRIVERS
Industry Performance
7
4Q08 / 2008
318
366379
406
448
11093
2004 2005 2006 2007 2008 4Q07 4Q08
Source: Anfavea
114
156 153144
122
3525
2004 2005 2006 2007 2008 4Q07 4Q08
� ∆ 2008 – 07 = 10.4%
� ∆ 4Q08 – 07 = -15.6%
� CAGR 2004 – 08 = 8.95%
� ∆ 2008 – 07 = -15.5%
� ∆ 4Q08 – 07 = -30.8%
� CAGR 2004 – 08 = 1.71%
LIGHT COMMERCIALS – BRAZIL (‘000 units)LIGHT COMMERCIALS – BRAZIL (‘000 units)
Production Export
8
4Q08 / 2008
107
117
106
137
167
37 39
2004 2005 2006 2007 2008 4Q07 4Q08
Source: Anfavea
25
38 3941
39
12
9
2004 2005 2006 2007 2008 4Q07 4Q08
� ∆ 2008 – 07 = 22.1%
� ∆ 4Q08 – 07 = 6.3%
� CAGR 2004 – 08 = 11.8%
� ∆ 2008 – 07 = -6.6%
� ∆ 4Q08 – 07 = -25.2%
� CAGR 2004 – 08 = 11.8%
ExportProduction
TRUCKS – BRAZIL (‘000 units)TRUCKS – BRAZIL (‘000 units)
9
4Q08 / 2008
29
35 34
39
44
9 8
2004 2005 2006 2007 2008 4Q07 4Q08
Source: Anfavea
13
19
1615
16
54
2004 2005 2006 2007 2008 4Q07 4Q08
� ∆ 2008 – 07 = 12.9%
� ∆ 4Q08 – 07 = -7.6%
� CAGR 2004 – 08 = 11.0%
� ∆ 2008 – 07 = 1.7%
� ∆ 4Q08 – 07 = -12.8%
� CAGR 2004 – 08 = 5.3%
ExportProduction
BUSES – BRAZIL (‘000 units)BUSES – BRAZIL (‘000 units)
10
4Q08 / 2008
69
53
46
65
85
17
22
2004 2005 2006 2007 2008 4Q07 4Q08
Source: Anfavea
31 31
22
27
30
87
2004 2005 2006 2007 2008 4Q07 4Q08
� ∆ 2008 – 07 = 30.7%
� ∆ 4Q08 – 07 = 25.4%
� CAGR 2004 – 08 = 5.3%
� ∆ 2008 – 07 = 10.9%
� ∆ 4Q08 – 07 = -4.5%
� CAGR 2004 – 08 = -0.8%
ExportProduction
AGRICULTURAL MACHINERY – BRAZIL (‘000 units)AGRICULTURAL MACHINERY – BRAZIL (‘000 units)
11
4Q08 / 2008
1,757
2,0092,092
2,388
2,567
632
457
2004 2005 2006 2007 2008 4Q07 4Q08
Source: Anfavea
497
684
635
588558
144125
2004 2005 2006 2007 2008 4Q07 4Q08
� ∆ 2008 – 07 = 7.5%
� ∆ 4Q08 – 07 = -27.7%
� CAGR 2004 – 08 = 9.9%
� ∆ 2008 – 07 = -5.1%
� ∆ 4Q08 – 07 = -12.7%
� CAGR 2004 – 08 = 2.9%
ExportProduction
PASSENGER CARS – BRAZIL (‘000 units)PASSENGER CARS – BRAZIL (‘000 units)
12
4Q08 / 2008
Source: Amsted Maxion estimate
5,642
7,270
3,668
1,249
5,118
729
1,372
2004 2005 2006 2007 2008 4Q07 4Q08
Sales
Sales
� ∆ 2008 – 07 = 309.8%
� ∆ 4Q08 – 07 = 88.2%
� CAGR 2004 – 08 = -2.4%
RAILWAY FREIGHT CARS – BRAZIL (units)RAILWAY FREIGHT CARS – BRAZIL (units)
13
4Q08 / 2008
MARKET SHARE – BRAZIL (2008)MARKET SHARE – BRAZIL (2008)
Others
15%
Dana
20%
Maxion
65%
Source: Iochpe-Maxion estimate
Borlem33%
Maxion62%
Others5%
Maxion
85%
Others
15%
Maxion
80%
Cruzaço
20%
� Maxion: 67% in 2007 � Maxion: 62% in 2007 � Maxion: 89% in 2007 � Maxion: 80% in 2007
ChassisChassis Commercial Vehicles Commercial Vehicles WheelsWheels
Railway Freight Railway Freight CarsCars
Railway Railway
CastingsCastings
Financial and Operating Performance
15
4Q08 / 2008
1,828
1,2891,248
462
329
1,099
1,494
2004 2005 2006 2007 2008 4Q07 4Q08
Net Operating Revenue
� ∆ 2008 – 07 = 41.8%
� ∆ 4Q08 – 07 = 40.7%
� CAGR 2004 – 08 = 13.6%
NET OPERATING REVENUE (R$ million)NET OPERATING REVENUE (R$ million)
16
4Q08 / 2008
89138
18429
19
79
132
121
4T07 4T08
Wheels Chassis Automotive Comp. Amsted Maxion
283363
99
46
4Q07 4Q08
Domestic Export
329
462
329
462
� Domestic: ∆ 4Q08 – 07 = 28.4%
� Export: ∆ 4Q08 – 07 = 116.2%
� Wheels: ∆ 4Q08 – 07 = 54.8%
� Chassis: ∆ 4Q08 – 07 = 39.8%
� Automotive Comp.: ∆ 4Q08 – 07 = -32.1%
� Amsted Maxion: ∆ 4Q08 – 07 = 52.7%
NET OPERATING REVENUE (R$ million)NET OPERATING REVENUE (R$ million)
Revenue by Market Revenue by Division / Business
17
4Q08 / 2008
Volvo
0%
ALL
1%
Vale
3%
Export
18%
Scania
6%
Others
13%
Agricultural
Machinery
7%
Ford
4%MRS
4%
Fiat
5%
GMB
6%
Daimler
14%
VW
17%
Export
15%
Daimler
12%
MRS
7%
GMB
5%
Scania
5%
Ford
4%
Vale
10%Others
11%
Agricultural
Machinery
7%
VW
17%
Fiat
3%
Volvo
2%
Caterpillar
1%
ALL
1%
NET OPERATING REVENUENET OPERATING REVENUE
Revenue by Customer – 2007 Revenue by Customer – 2008
18
4Q08 / 2008
44
26
146
120
47
119
96
2004 2005 2006 2007 2008 4Q07 4Q08
Exports
� ∆ 2008 – 07 = 21.3%
� ∆ 4Q08 – 07 = 69.9%
� CAGR 2004 – 08 = 32.7%
EXPORTS (USD million)EXPORTS (USD million)
19
4Q08 / 2008
10 12
90
011
23
5
4Q07 4Q08
Wheels Chassis Automotive Comp. Amsted Maxion
R$ thousand
1726
21
0
0
20
52
8
4Q07 4Q08
Wheels Chassis Automotive Comp. Amsted Maxion
46
99
US$ thousand
26
44
Variation 4Q8 - 07 = 116.2%
� Wheels = 51.9%
� Chassis = 149.5%
� Automotive Comp. = 0.4%
� Amsted Maxion: = 159.3%
Variation 4Q8 - 07 = 69.9%
� Wheels = 20.3%
� Chassis = 96.3%
� Automotive Comp. = -21.2%
� Amsted Maxion: = 103.0%
EXPORTS BY DIVISION / BUSINESSEXPORTS BY DIVISION / BUSINESS
20
4Q08 / 2008
228
289
74
219
52
236
357
16%16%18%
19%21%
18%20%
2004 2005 2006 2007 2008 4Q07 4Q08
Gross Profit % NOR
Gross Profit
� ∆ 2008 – 07 = 51,4%
� ∆ 4T08 – 07 = 42,6%
� CAGR 2004 – 08 = 11,9%
GROSS PROFIT (R$ million)GROSS PROFIT (R$ million)
21
4Q08 / 2008
178
127
35
136
26
126
232
8%8%
11%12%12%
10%
13%
2004 2005 2006 2007* 2008 4Q07 4Q08
EBIT % NOR
EBIT
� ∆ 2008 – 07 = 83.8%
� ∆ 4Q08 – 07 = 32.5%
� CAGR 2004 – 08 = 16.3%
(*) In compliance with Instruction 539/08 of CVM (Brazil’s securities commission) of March 14, 2008 and guidance of the Accounting Pronouncement Committee, Iochpe-Maxion incorporated the amounts accounted as non-operating expenses in 2008 and 2007 into operating expenses, therefore reducing EBIT presented in the previous reports.
EARNINGS BEFORE INCOME TAX – EBIT (R$ million)EARNINGS BEFORE INCOME TAX – EBIT (R$ million)
22
4Q08 / 2008
156
46
268
156
34
163
205
15%12%
14% 14%13%
10% 10%
2004 2005 2006 2007** 2008 4Q07 4Q08
EBITDA % NOR
EBITDA
� ∆ 2008 – 07 = 71.7%
� ∆ 4Q08 – 07 = 34.3%
� CAGR 2004 – 08 = 14.5%
(*) 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.
(**) In compliance with Instruction 539/08 of CVM (Brazil’s securities commission) of March 14, 2008 and guidance of the Accounting Pronouncement Committee, Iochpe-Maxion incorporated the amounts accounted as non-operating expenses in 2008 and 2007 into operating expenses, therefore reducing EBITDA presented in the previous reports.
EBITDA* (R$ million) EBITDA* (R$ million)
23
4Q08 / 2008
23
33
37
21
-1
10
28
5%
0%
2%2%
3%
1%2%
2004 2005 2006 2007 2008 4Q07 4Q08
Financial Exp. % NOR
Net Financial Expenses
� ∆ 2008 – 07 = 187.1%
� ∆ 4Q08 – 07 = 3,243.0%
� CAGR 2004 – 08 = -4.0%
NET FINANCIAL EXPENSES (R$ million)NET FINANCIAL EXPENSES (R$ million)
24
4Q08 / 2008
� Impact of the FX rate variation on Finacial Expense (Revenue)
� Operations related to fix the future value of the
dollar (NDFs)
� If the operations would expire on 12/30/2008, it
would represent a negative result of R$ 28.7 million
IMPACT OF THE FX RATE VARIATIONIMPACT OF THE FX RATE VARIATION
4Q08
BalanceValue
US$ Million
Impact
R$ million
NDF (expired) 25.4 (7.8)
Loan in Foreing Currency 58.9 (18.8)
Financial Exp./ Rev. (26.6)
Period OperationsContracted Value
US$
Average FX
Rate
Gain/Loss
R$ thousand
NDFs (Buying) 60.8 1.8940 (30.0)
NDFs (Selling) 2.0 1.6786 1.3
Total NDFs (28.7)
At the end
of 4Q08
25
4Q08 / 2008
17
214
725172
58
5
1%
5%
12%
6%5%
5%
5%
2004 2005 2006 2007 2008 4Q07 4Q08
Net Income % NOR
Net Income
� ∆ 2008 – 07 = 195.7%
� ∆ 4Q08 – 07 = -71.3%
� CAGR 2004 – 08 = 43.1%
76
76
133
Non-recurring gain generated by
the merger of Maxion Sistemas
Automotivos into Iochpe-Maxion
Net Income w/o Non-
recurring Effect
� ∆ 2008 – 07 = 90.7%
138
76
NET INCOME (R$ million)NET INCOME (R$ million)
26
4Q08 / 2008
115
128
102
125 132
256
0.6
1.3
1.0
0.80.8
0.6
2003 2004 2005 2006 2007 2008
Net Debt x EBITDA*
NET BANK DEBT (R$ million)NET BANK DEBT (R$ million)
(*) 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
LTM EBITDA
27
4Q08 / 2008
Working
Capital
3%
Import
11%ACC
12%Others
6%
BNDES-EXIM
68%
INDEBTEDNESS – DEC/08 (R$ million)INDEBTEDNESS – DEC/08 (R$ million)
TJLP
69%
Others
1%YUAN
5%
Dollar
25%
Debt by Lines
220
- -
12690
256
346
Short Term Long Term Total Debt Cash Net Debt
Debt Indexation
Indexation Average Cost
Indexed in R$ 73% CDI
Indexed in US$ 5,5% per year
28
4Q08 / 2008
68 6873
113
84
2004 2005 2006 2007 2008
CAPEX (R$ million)CAPEX (R$ million)
Additional Information
30
4Q08 / 2008
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.
(*) In compliance with Instruction 539/08 of CVM (Brazil’s securities commission) of March 14, 2008 and guidance of the Accounting Pronouncement Committee, Iochpe-Maxion incorporated the amounts accounted as non-operating expenses in 2008 and 2007 into operating expenses, therefore reducing EBITDA presented in the previous reports.
Consolidated Income Statement R$
thousand4Q08 N.O.R
4Q07*
AdjustedN.O.R 2008 N.O.R
2007*
(Adjusted)N.O.R
Net Operating Revenue 462,013 100.0% 328,459 100.0% 1,827,726 100.0% 1,289,282 100.0%
Cost of Goods Sold
Raw Material (231,838) 50.2% (153,707) 46.8% (896,406) 49.0% (598,928) 46.5%
Labor (79,205) 17.1% (38,122) 11.6% (284,595) 15.6% (222,604) 17.3%
Others (77,401) 16.8% (85,037) 25.9% (289,755) 15.9% (232,044) 18.0%
(388,443) 84.1% (276,866) 84.3% (1,470,756) 80.5% (1,053,576) 81.7%
Gross Profit 73,570 15.9% 51,593 15.7% 356,970 19.5% 235,706 18.3%
Operating Expenses
General and Administrative (14,307) 3.1% (12,105) 3.7% (52,386) 2.9% (47,009) 3.6%
Commercial (23,081) 5.0% (12,807) 3.9% (73,158) 4.0% (55,749) 4.3%
Others (1,300) -0.3% (361) -0.1% 229 0.0% (6,927) -0.5%
(38,688) 8.4% (25,273) 7.7% (125,315) 6.9% (109,685) 8.5%
Operating Income (EBIT) 34,882 7.6% 26,320 8.0% 231,655 12.7% 126,021 9.8%
Financial Results
Financial Revenue 4,271 0.9% 1,685 0.5% 13,795 0.8% 6,233 0.5%
Financial Expenses (26,869) 5.8% (966) 0.3% (41,376) 2.3% (15,839) 1.2%
(22,598) 4.9% 719 -0.2% (27,582) 1.5% (9,606) 0.7%
Earnings After Financial Income 12,284 2.7% 27,039 8.2% 204,073 11.2% 116,415 9.0%
Non Operating Results - 0.0% - 0.0% - 0.0% - 0.0%
Earnings Before Taxes 12,284 2.7% 27,039 8.2% 204,073 11.2% 116,415 9.0%
Income Taxes (7,393) -1.6% (10,010) -3.0% 10,021 0.5% (44,024) -3.4%
Net Income 4,891 1.1% 17,029 5.2% 214,094 11.7% 72,391 5.6%
EBITDA** 46,024 10.0% 34,275 10.4% 267,727 14.6% 155,899 12.1%
31
4Q08 / 2008
BALANCE SHEET (R$ thousand)BALANCE SHEET (R$ thousand)
ASSETS LIABILITIES
dez/08 dez/07 dez/08 dez/07
CURRENT CURRENT
Cash 90.036 151.519 Loans 219.885 131.820
Receivables 243.056 142.348 Payables 60.972 62.093
Inventory 244.527 173.181 Taxes 2.886 3.114
Recoverable Taxes 13.694 21.975 Wage & Salaries 49.908 40.253
Deferred Taxes 27.538 8.979 Customers Advance 24.152 50.033
Recoverable Taxes 1.901 2.546 Dividends 79.214 26.785
Other Receivables 7.985 3.748 Other Payables 34.937 21.666
Payable Financial
Instruments28.752 -
628.737 504.296 500.706 335.764
LONG TERM LONG TERM
Receivable 603 802 Loans 125.604 148.045
Recoverable Taxes 16.667 20.219 Provisions 58.021 57.431
Deferred Taxes 82.362 19.902 Others 6.611 7.579
Obligatory deposits and judicial 12.847 1.669 190.236 213.055
Other Receivables 1.718 2.388
114.197 44.980
MINORITY - -
PERMANENT EQUITY
Investments 395 359 Capital 261.463 161.463
Plants, Property and Equipment 379.330 305.263 Profit Reserves 183.958 149.078
Intangible 5.910 4.117 Equity Adjustment (2.484) -
Deferred Items 5.310 345
390.945 310.084 442.937 310.541
TOTAL ASSETS 1.133.879 859.360 TOTAL LIABILITIES 1.133.879 859.360
32
4Q08 / 2008
� Due to the low liquidity of MYPK3 before the conversion of the shares, was considered the price of MYPK4 before the conversion (02/26/08)
-76.18%
-41,22%
-80.00%
-70.00%
-60.00%
-50.00%
-40.00%
-30.00%
-20.00%
-10.00%
0.00%
10.00%
20.00%
Jan-08 Feb-08 Mar-08 Apr-08 May-08 Jun-08 Jul-08 Aug-08 Sep-08 Oct-08 Nov-08 Dec-08
MYPK3 IBOVESPA
SHARES PERFORMANCE - LTMSHARES PERFORMANCE - LTM
33
4Q08 / 2008
Average Daily Trade Volume LTM - R$ thousand
1,987
1,413
1,7471,671
1,377
3,370
2,978
2,294
1,164
1,543
685 734
146
91
105
77
3743
3743
7481
75
38
Jan-08 Feb-08 Mar-08 Apr-08 May-08 Jun-08 Jul-08 Aug-08 Sep-08 Oct-08 Nov-08 Dec-08
Volume Trades
� Due to the low liquidity of MYPK3 before the conversion of the shares, was considered the price of MYPK4 before the conversion (02/26/08)
AVERAGE DAILY TRADE VOLUME – R$ thousandAVERAGE DAILY TRADE VOLUME – R$ thousand
34
4Q08 / 2008
SHAREHOLDERS STRUCTURESHAREHOLDERS STRUCTURE
Shareholders Structure on 12/30/2008
Shareholders Shares %
Ioschpe Family 13,034,376 27.48%
BNDESPAR 11,593,401 24.44%
Controlling Shareholders 24,627,777 51.92%
Others 22,803,909 48.08%
Total Iochpe-Maxion 47,431,686 100.00%
February, 2009
EARNINGS RELEASE – 4Q08 / 2008EARNINGS RELEASE – 4Q08 / 2008