Credit Suisse Latin America Investment Conference January 30-31, 2018

Transcription

1 Credit Suisse Latin America Investment Conference January 30-31, 2018

2 Contents About Santos Brasil Port of Santos Tecon Santos Tecon Imbituba Tecon Vila do Conde TEV Vehicle Terminal Logistics Investments & Financial Highlights Corporate Governance Sustainability 2

3 About Santos Brasil Privileged location BTP Embraport Rodrimar Libra Ecoporto 12 3

4 About Santos Brasil History 1997 Santos Brasil was founded to participate in the privatization of the Port of Santos. The company acquired Tecon Santos for a 25- year concession period, renewable for another 25 years A successful IPO took place, strengthening the company s Corporate Governance and preparing it for further expansion Acquisition of the logistics arm (Santos Brasil Logística) enabling the company to provide large-scale logistic services to customers Acquisition of Imbituba and Vila do Conde container terminals, aiming to attend the Brazilian Coast and to become a nationwide leader in Logistics and Container Terminal Operations Acquisition of the Santos Vehicle Terminal for a 25-year concession period, renewable for another 25 years Corporate restructuring, merger of the business units into the holding company, and rebranding Tecon Santos sets a new record in the Brazilian port sector, handling 105,530 containers in one month Tecon Santos received the biggest vessel of the port s history. Standard & Poor's upgrades the Company s rating to braaa, the highest grade for a Brazilian company Santos Brasil surpassed the 200 movements per hour (MPH) mark on a single vessel, maintaining an average of 100 MPH in Tecon Santos Tecon Santos concession is early renewed for an additional 25-year period Santos Brasil shares migrate to Novo Mercado, B3 s (ex- BM&FBovespa) segment with the highest corporate governance level. All preferred shares are converted to voting shares Tecon Vila do Conde concession is renewed for an additional 15-year period. An amendment to the Port Law increases the maximum concession period for public port terminals to 70 years, from 50 years prior. 4

5 About Santos Brasil Highlights Publicly-traded company, listed in B3 (ex-bm&fbovespa) Five terminals on the Brazilian coast TECON VILA DO CONDE - Three Container Terminals - One Vehicle Terminal - One General Cargo Terminal Container throughput: 1.53 million TEU (twenty-foot equivalent unit) in 2016 and 1.48 million TEU in 2017 Port-to-Door full logistic solution (Santos Brasil Logística) 19% of the Brazilian throughput* TECON SANTOS * Source : ANTAQ 2016 DISTRIBUTION CENTER (SÃO BERNARDO DO CAMPO) TECON IMBITUBA TCG IMBITUBA (GENERAL CARGO TERMINAL) TEV BONDED LOGISTICS CENTERS (SANTOS AND GUARUJÁ) 5

6 Port of Santos Must-call port in South America Largest Port in South America Accounts for more than 25% of Brazilian trade balance Port hinterland covering 55% of Brazil s GDP Privileged rail and road connections ~90% of São Paulo s industrial base is located less than 200 kilometers from the Port of Santos 39% Brazilian Ports (volume market share 2016) 59% 6% 8% 8% 2% 13% 2% 3% Santos Other Southeast South North /Northeast Others 1% 2% 3% 5% 4% 2% Rio de Janeiro Itaguaí / Sepetiba Vitória Itajaí/Navegantes Paranaguá Rio Grande Itapoá/S. F. do Sul Suape Manaus Salvador Pecém Fortaleza Source: ANTAQ 6

7 Port of Santos Tecon Santos market-share in 2017: 33.9% Container throughput in 2017 x Port of Santos: +5.8% (+8.1% in TEU) - Tecon Santos: -9.7% (-7.7% in TEU) - Tecon Santos ex-esa (1) : +4.2% 19-year CAGR ( ) - Port of Santos: 8.6% - Tecon Santos: 9.2% Port of Santos Tecon Santos Container throughput (TEU x 1,000) 2,984 3,104 2,722 3,448 3,656 3,780 3,854 3,564 2,268 2,446 2,533 2,685 2,252 1,048 1, ,883 1, ,008 1,159 1,253 1,270 1,044 1,355 1,487 1,733 1,811 1,380 1,314 1,426 1, (1) The long-haul ESA service, with route to Asia, operated at Tecon Santos until the end of April 2017; Source: CODESP and Santos Brasil 7

8 TECON SANTOS 8

9 Tecon Santos Best solution for containers in South America Largest container terminal in South America Growth capacity: CAPEX plan of R$ 1,3 billion Structure to receive Post-Panamax vessels Operation with internet access Equipment is 100% GPS controlled Annual capacity: 2,000,000 TEU - Average monthly productivity per crane: 37 MPH - Average monthly productivity per vessel: 105 MPH - Total area: 596,000 m² - Quayline extension: 980m + 310m (vehicle terminal) - 13 STS (ship-to-shore gantry cranes) and 1 MHC (mobile harbour crane) - 46 RTG / 18 reach stackers - 4 internal railway lines 7 9

10 Tecon Santos R$ 2.9 billion (1) invested to upgrade and expand the terminal High Productivity - movements per hour per vessel (MPH) Tecon Santos in 1997: 11 MPH Monthly Average 100 MPH Tecon Santos in 2017: 100 MPH 11 MPH (1) IGP-M inflation adjusted 10

11 Tecon Santos Next investment cycle: cutting-edge technology, modern layout NEW LAYOUT Automation Focus on efficiency New Capacity 2,400,000 TEU Quay extension Estimated CAPEX R$ 1.3 billion (US$ 400M) 11

12 TECON IMBITUBA Tecon Imbituba Inserir imagem aqui, preenchendo o espaço por completo. 12

13 Tecon Imbituba Premium location at the Southern Region Port terminal ready to receive Post-Panamax vessels Close to Santa Catarina and Rio Grande do Sul industrial zones Competitive advantages: 24/7 operation, natural water draft, favorable weather conditions Benefit of adjacent infrastructure projects: - The widening of BR-101 federal highway - Construction of Coastal Railway - Port of Santos draft increase to 15 meters Annual capacity: 450,000 TEU - Total area: 207,000 m² - Quayline extension: 660m / Water draft: 14.5m - 2 STS (ship-to-shore crane) and 2 MHC (mobile harbour crane) - 8 reach stackers 7 13

14 Tecon Imbituba R$ 965 million (1) invested since 2008 Improving Productivity - movements per hour per vessel (MPH) Monthly Average 67 MPH MPH * (1) IGP-M inflation adjusted. Includes investments in Imbituba General Cargo terminal (2) July

15 Tecon Imbituba Potential for volume increase Tecon Imbituba and its peer terminals (Itajaí/Navegantes and Rio Grande) are equidistant from the industrial zones and the consumption centers in the Southern region Container Terminal PR SC Paranaguá 725,041 TEU* Itapoá / São Francisco do Sul 554,907 TEU* Itajaí / Navegantes 1,104,143 TEU* Imbituba 27k TEU in 2016 (50k TEU in 2017) Imbituba Hinterland Pork and Poultry Production RS * Source: Volume in 2016 (ANTAQ) Rio Grande do Sul Industrial Zone Rio Grande 705,154 TEU* 15

16 TECON VILA DO CONDE 16

17 Tecon Vila do Conde Located in the delta of Amazon River region Access to all continents, directly or through the main Caribbean hub ports Brazilian s second largest cabotage port No physical limitation to receive large vessels Major competitor (port of Belém) is a river port with limited draft (~ 6 meters) Best logistics to serve the North and Amazon regions: logistics with container barges using different rivers basins Main cargoes: high-value metals and minerals, kaolin, wood, frozen beef, frozen fruits and pepper Annual capacity: 140,000 TEU - Total area: 86,615m² - Quayline extension: 254m / Water draft: 13.0m - 2 MHC - 8 reach stackers 7 17

18 Tecon Vila do Conde North Region: Inland waterway cargo transportation TECON VILA DO CONDE Vila do Conde x MUNGUBA Main Cargoes: Kaolin and Cellulose Vila do Conde x MACAPÁ-AP Main Cargoes: Chemical Products Vila do Conde x BELÉM Main Cargo: Wood Vila do Conde Vila do Conde x MANAUS-AM Main Cargoes: Spare Parts and Chemical Products Vila do Conde x SANTARÉM X ITAITUBA Main Cargo: Wood Vila do Conde x ALTAMIRA Main Cargo: Machinery Vila do Conde x CAMETÁ Main Cargo: Palm Oil Vila do Conde x TUCURUÍ Main Cargo: Silicon 18

19 TEV - Vehicle Terminal Largest vehicle terminal in Brazil Neighbor of Tecon Santos Handling of different types of cargo: trains, dismantled industrial plants, power transformers, dismantled machinery, large sculptures etc Annual capacity: 300,000 units - Static capacity: 10,000 units throughput: 179,888 units (219,499 units in 9M17) - Total area: 164,000 m² - Quayline extension: 310 m 19

20 Logistics Vertical integration Taylor-made logistics projects, integrating maritime transport to exporters and importers needs Potential to increase customers competitiveness: eg. the K10 logistics operation for BASF Synergies between integrated logistics and port operations Infrastructure: - Distribution Center in São Bernardo do Campo (105,000m²) - CLIA Guarujá (bonded warehouse - 52,900m²) - CLIA Santos (bonded warehouse - 64,755m²) - Own truck fleet with 135 GPS-tracked trucks Exports Imports Just-In-Time Tecon Santos Bonded warehousing - Tecon Santos (left bank) - Clia Santos (right bank) - Clia Guarujá (left bank) Exports Container Transportation Just-in-Time delivery to Industrial Plants Imports Container Transportation Distribution Center 20

21 Main clients Port terminals and Logistics 21

22 Investments R$ 4.78 bilhões (1) in 20 years M&A 1997 Tecon Santos bidding 2006 Santos Brasil IPO 2007 Santos Brasil Logística acquisition 2008 Tecon Imbituba bidding & Tecon Vila do Conde acquisition 2009 Vehicles terminal bidding CAPEX 2004/2006 Tecon Santos first expansion 2008/2010 Tecon Santos second expansion 2008/2011 Tecon Imbituba expansion M&A CAPEX (1) IGP-M inflation adjusted 22

23 Financial Highlights EBITDA and EBITDA Mg. Net Revenues (R$M) Net Revenues Breakdown (1) ,125 1,293 1,378 1, Port terminals (warehousing) 31% Logistics 22% Vehicles terminal 6% Port terminals (quay) 41% M17 36 EBITDA (R$M) and EBITDA margin (%) Net Income (R$M) and Net margin (%) 38.6% % % % % % 42.6% % 29.2% % % 9.2% (99) % % % % % 20.9% 18.5% % (18) (20) (18) -1.9% -2.4% -2.9% M17 (1) Does not consider intracompany eliminations -23.6% M17 23

24 Debt Leverage and Cash Flow S&P Corporate rating in national scale: braa- EBITDA and EBITDA Mg. Net Debt (R$M) and Net Debt / EBITDA (1) x 1.16x x 0.73x 0.31x x x 0.38x 0.46x x M17 Operating Cash Flow (R$M) M17 Total Debt (R$) and Long-Term Debt (%) 65% 62% 55% 53% 54% 56% 59% 48% Total Debt - Currency 21% 26% 27% Local currency (BRL) Foreign currency 17% 18% 12% 3% 51% 66% 63% 70% % % 37% 30% 79% 74% 73% 83% 82% 88% 97% M17 (1) Last-twelve-month EBITDA M17 24

25 Corporate Governance All preferred shares converted to voting shares in 2016 Novo Mercado listing on B3 (ex-bm&fbovespa) Shareholding Structure 100% Tag Along for all minority shareholders One Share, One Vote (no shareholders agreement) Board of directors: 7 members formed by shareholders Permanent Fiscal Board Management: - Stock Options, Performance Shares and Matching for key executives; - Compensation program for managers and employees: EBITDA and EVA oriented; - Individual performance plans = clear and quantifiable targets; - Progression, promotion and compensation based on meritocracy; Richard Klien 6.0% (1) Multi STS Participações 6.1% Dynamo 9.8% PW237 Participações 22.4% Others 25.7% International Market Investments 29.0% Management 0.2% Treasury 0.8% Total of 666,317,880 voting shares (1) Includes the stake of the fund RK Exclusivo FIA 38 25

26 Corporate Governance Management CEO Antonio Carlos Duarte Sepúlveda - Mr. Sepúlveda is the Chief Executive Officer of Santos Brasil. He has been working in the port sector since 1992, and in Santos Brasil since He was Chief Operation Officer of the company from 2002 to Mr. Sepúlveda holds a degree in Civil Engineering and an MBA from Saint Joseph s University in Philadelphia. CFO Daniel Pedreira Dorea - Mr. Dorea is the Chief Financial Officer, Investor Relations Officer and a member of the Board of Directors of Santos Brasil Participações S.A.. He was a partner at Opportunity Asset Management (USD 8bn of AUM), responsible for managing its private equity portfolio from 2011 to Between 2014 and 2016 he was a member of the Board of Directors of Petrorecôncavo S.A. Prior to that, he participated in the Commercial Policy Training Program promoted by the Embassy of Brazil in Washington, D.C. in Mr. Dorea holds a double major in Business Administration and Law. CCO Marcos Magalhães Tourinho - Mr. Tourinho is the Chief Commercial Officer of Santos Brasil. Prior to that, he was the Port Operations and Commercial Director of the company. He started his career in Santos Brasil as Investor Relations Officer in Mr. Tourinho holds a bachelor degree in Business Administration, a post-graduation degree in Finance from McGill University and an MBA from HPU Universtity. COO Marlos Silva Tavares - Mr. Tavares is the Chief Operating Officer of Santos Brasil. He has a strong background in the shipping industry, where worked for APM Maersk group. He also worked for the Brazilian logistics group Libra as Commercial Director of Libra's container terminal in the port of Santos. Mr. Tavares holds a double major in Business Administration and Accounting and is a 6-sigma greenbelt from PMI International

27 Sustainability Member of the Global Pact, an international sustainability pact Sustainability Report compliant with GRI Standard since 2012 Sustainability Academy, an ongoing training for leaders 42 27

28 Disclaimer +55 (11) We make forward-looking statements that are subject to risks and uncertainties. These statements are based on the beliefs and assumptions of our Management and on the information currently available to the company. Forward-looking statements include information on our current plans, beliefs or expectations and also those of the company s Board of Directors and its Officers. Disclaimers involving forward-looking statements include information on potential or assumed operating results, as well as statements that are preceded, followed or include the words believe, may, will, continue, expect, project, seek, plan, estimate or similar expressions. Forward-looking statements and information provide no guarantee of performance. Because they refer to future events, and as such depend on circumstances that may or may not occur, they involve risks, uncertainties and assumptions. Future results and the creation of value for shareholders may differ significantly from that expressed or suggested in the forward-looking statements. Many factors that will determine these results and values are beyond our capacity to control or predict.