LUIS HENRIQUE GUIMARÃES

Transcription

1 LUIS HENRIQUE GUIMARÃES

2 DISCLAIMER This presentation contains estimates and forward-looking statements regarding our strategy and opportunities for future growth. Such information is mainly based on our current expectations and estimates or projections of future events and trends, which affect or may affect our business and results of operations. Although we believe that these estimates and forward-looking statements are based upon reasonable assumptions, they are subject to several risks and uncertainties and are made in light of information currently available to us. Our estimates and forward-looking statements may be influenced by the following factors, among others: (1) general economic, political, demographic and business conditions in Brazil and particularly in the geographic markets we serve; (2) inflation, depreciation and devaluation of the real; (3) competitive developments in the ethanol and sugar industries; (4) our ability to implement our capital expenditure plan, including our ability to arrange financing when required and on reasonable terms; (5) our ability to compete and conduct our businesses in the future; (6) changes in customer demand; (7) changes in our businesses; (8) government interventions resulting in changes in the economy, taxes, rates or regulatory environment; and (9) other factors that may affect our financial condition, liquidity and results of our operations. The words believe, may, will, estimate, continue, anticipate, intend, expect and similar words are intended to identify estimates and forward-looking statements. Estimates and forward-looking statements speak only as of the date they were made and we undertake no obligation to update or to review any estimate and/or forward-looking statement because of new information, future events or other factors. Estimates and forwardlooking statements involve risks and uncertainties and are not guarantees of future performance. Our future results may differ materially from those expressed in these estimates and forward-looking statements. In light of the risks and uncertainties described above the estimates and forward-looking statements discussed in this presentation might not occur and our future results and our performance may differ materially from those expressed in these forward-looking statements due to, inclusive, but not limited to the factors mentioned above. Because of these uncertainties you should not make any investment decision based on these estimates and forward-looking statements.

3 CORPORATE FUELS ENERGY ENERGY Raízen at a Glance Key Dimensions Raízen is the world s largest individual producer exporter of sugar, and operates more than 6,000 Shell-branded service stations in Brazil. 68 mln tons of crushing capacity (10% of Brazilian Center-South) 4.2 mln tons of Sugar production World s largest sugar producer exporter 2.0 bln liters of Ethanol production 98% Mechanized Harvest 940 MW Cogeneration capacity Self sufficient in electricity consumption 6,027 service stations 25 bln liters of fuels sales 1,880 B2B customers 67 fuels depots 960 convenience stores 64 airport operations 5 TH largest company in Brazil in net revenues (Source: Valor ) ~28 k employees Investment Grade in global scale Fitch (BBB) Moody s (Ba1) Standard & Poor s (BBB-) The combination of Shell and Cosan s retail and technical expertise contributed to Raizen s strong financial and operational performance since it was established.

4 Raízen at a Glance Operational Excellence LTIF (Lost Time Injury Frequency) Engaging leaders Risks assessed and safety barriers in place Contractors management with HSSE controls Behavior based system implemented Continuous improvement Note: LTIF = Number of acidents resulting on employee absence divided by total hours works with risk exposure (in million hours).

5 Raízen at a Glance Financial Highlights ADJUSTED EBITDA (BRL Bln) CASH GENERATION (ADJ. EBITDA CAPEX) (BRL Bln) DIVIDENDS (BRL Bln) CAPEX (BRL Bln) Note: Considers 100% of results, under Raízen s perspective. Adjusted EBITDA excludes effects from change in biological asset and hedge accounting - debt at Raízen Energia.

6 FUELS DISTRIBUTION

7 Facing a New Business Environment After years of double-digit growth in Brazil, demand for fuels contracted in 2015 and FLEET VS CONSUMPTION (yoy%) GDP VS DIESEL CONSUMPTION (yoy%) Source: ANP and Raízen s estimates Source: ANP and IBGE

8 Performing in a New Business Environment For decades Brazil had a single and fully integrated fuels supplier, prices did not follow international parity and the country was supposed to be self sufficient, sooner rather than later... DIESEL (in BRL/L) Price gap between domestic vs international market GASOLINE (in BRL/L) Price gap between domestic vs international market IMPORTS (in mln cbm) H16 2H H16 2H Premium Discount Premium Discount Total Imports Petrobras SINDICOM Others Source: ANP and Petrobras now supply is more flexible and prices trend to international parity. The country is structurally short of diesel and otto-cycle, and several players import.

9 Supply & Demand Current Scenario Infrastructure gaps both inland and at ports Raízen-owned and,third party Terminals, Operated and Third party Pools Competition for supply sourcing increased need for structural positioning/investments Supply, Trading and Shipping skills become vital Operational efficiency and flexibility becomes a key source of differentiation (logistics and infrastructure) Preparing for a possible change Diesel balance (000 m³/month) North / Northeast -348 Center / South -271 Investments of BRL 1.4 billion in infrastructure since terminals Gasoline balance (000 m³/month) Infrastructure to sell +6 bln liters of fuels quarterly JET balance (000 m³/month) Storage capacity of 725,000 cbm Invested capital of BRL 1.9 bln Source: ANP Jan-Dec 16

10 Growth Strategy Continues to Pay Off Favorable competitive landscape opened room to accelerate growth strategy, grounded on strengthened relationship with Shell-branded retailers and consumers. SERVICE STATIONS VOLUME GROWTH & MARKET SHARE THROUGHPUT PER STATION (Thousand cbm/month) Note: Volumes based on Sindicom methodology. Market Share excludes greases and lubricants VOLUME GROWTH VS MARKET Note: The analysis excludes greases and lubricants.

11 Delivering Strong and Resilient Performance ADJUSTED EBITDA (BRL Bln) ADJUSTED EBIT (BRL Bln) CAPEX (BRL Bln) CASH GENERATION (ADJ. EBITDA CAPEX) (BRL Bln) Note: Consider 100% of Raízen s results, under Raízen s perspective. Adjusted EBITDA and EBIT excludes impacts from asset sale and other nonrecurring effects.

12 The Shell Experience Products & Payment Methods PRODUCTS Lower diesel consumption PAYMENT METHODS Shell Box Payment App Powerfull CRM Platform Lower CO 2 emissions Cleans and protecs engine Higher performance and agility

13 Looking Ahead Brazilian Market Petrobras is no longer the sole supplier Contraction trend to revert, but recovery of sales volumes will be slow Direct imports are now part of Brazilian supply basket Prices guided by international parity Raízen Selective expansion of distribution network Increase throughput/station The Shell Experience Efficiency/Cost reductions Continued optimization of supply strategies Infrastructure/logistics selective positioning

14 ENERGY

15 mln t, raw value mln t, raw value Sugar Supply & Demand Balance Remains Tight Brazil continues to be the lowest-cost sugar producer PRODUCTION COST (c$/lb, ex-mill) 2007/ / / / / / / / / / SUGAR - WORLD S&D Australia India Thailand France Brazil (C.S.) Source: Raízen s estimates based on consulting companies mln t SUGAR TRADING 2015/ % Note: Figures refers to international crop year from October to September mln t 14% 6% 3.9 mln t Surplus/Deficit World Sugar Prod World Sugar Cons Note: Figures refers to international crop year from October to September. cusd/lb cbrl/lb SUGAR PRICE jan-06 jan-07 jan-08 jan-09 jan-10 jan-11 jan-12 jan-13 jan-14 jan-15 jan-16 jan-17 and the scenario remains favorable for coming years

16 Hydrous Sugar Spread Ethanol Directly Impacted by Gasoline Prices Brazilian gasoline prices now follow international parity trends: volatility adds to crop seasonality. GASOLINE X ETHANOL PUMP PARITY (%) AVERAGE PUMP PRICE (BRL/L) 71.5% 67.6% 67.2% 64.5% 61.1% 76.9% 63.3% 76.8% Source: ANP Ethanol Gasoline MONTHLY FUTURES - SUGAR, HYDROUS AND SPREAD (in c$/lb) PRODUCERS AVERAGE PRICES (BRL/CBM) W/O TAXES Spread NY#11 Hydrous SP 7,0 6,0 5,0 4,0 3,0 2,0 1,0 0,0-1,0-2,0-3,0 1,492 1,430 1,323 1,317 1,949 2,007 1,622 1,697 1,655 1,539 1,966 1,777 Source: CEPEA/ESALQ Hydrous Anhydrous

17 Focus on Efficiency Continues Raízen is the most cost efficient player locally AGRICULTURAL PRODUCTIVITY (TSR/HC) CAPEX + OPEX (BRL Bln) Source: UNICA Raízen Center South Fixed Costs Variable Costs (ex 3rd party sugarcane) Note: Estimated results in 2016 /17real terms, under Raízen s perspective. while maximizing profitability through product mix.

18 Decreasing Unit Cost Planting + Agricultural Logistics + Industrial Cost ~80% of cost base. PLANTING AND TREATMENT (BRL Mln) CLT CUTTING, LOADING AND TRANSPORTATION (BRL/ton) INDUSTRIAL COST (BRL/ton) Note: Estimated results in 2016 /17real terms, under Raízen s perspective. Continued focus on agricultural, industrial and logistics productivity yielding results.

19 Improving Returns 2016/17 crop year pointing to improved returns, combining efficiency efforts with a more favorable price environment. ADJUSTED EBIT/TSR SOLD (BRL/ton) ROIC (%) Note: Adjusted EBIT excludes Biological Asset and Hedge Accounting effects.

20 Efficiency Journey Continue to reap rewards from efficiency improvements. LTIF In place Mechanization Processes review Management In progress Zero Basis Budget Precision agriculture Pentágono E2G / Biogas Benchmarking Planting and harvesting integration Next steps Big data analysis Capacity Utilization Suppliers Development We are approaching the end quartile of current (non-disruptive) cycle, but there is more to come!

21 Core Values Efficiency Profitability Raízen Scalability Sustainability

22 THANK YOU