Download - 1 conference call 1 q11
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Conference Call
May 16, 2011
1Q11 Earnings Results
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This presentation contains forward-looking statements relating to the prospects of the
business, estimates for operating and financial results, and those related to growth prospects
of OHL Brasil, these are merely projections and, as such, are based exclusively on the
expectations of OHL Brasil’s management concerning the future of the business and its
continued access to capital to fund the Company’s business plan.
Such forward-looking statements depend, substantially, on changes in market conditions,
government regulations, competitive pressures, the performance of the Brazilian economy and
the industry and are, therefore, subject to change without prior notice.
NOTICE
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IFRS – MAIN CHANGES IN ACCOUNTING STANDARDS
PAST PRESENT
Permanent Assets Intangible AssetsClassification
Maintenances Expenses
Revenues
Amortization
Useful lives of assets/term
contractTerm Contract/Curve
Traffic
Results Toll Results Construction
and Tolls
Fixed assets and
depreciation
Results (provision)
* Others assets of the company remain the same.
* The differences between the tax bases and accounting bases should generate new effects related to deferred taxes (temporary differences).
* Revenue from construction is determined by the fair value of their service, without margin.
* The provision for maintenance is recognized by the present value.
From 2010, the Company shall submit financial statements in accordance with accounting standards
established by the International Accounting Standards Board - IASB (known as International Financial
Reporting Standards - IFRS) and reflected by CVM Instruction 457, July 13 2007 and amendments thereto.
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TRAFFIC
Traffic Growth
The volume of toll-paying traffic of state and federal concessions presented, respectively, 20.3% and 18.5% increases in
1Q11 compared to 1Q10. These increases were mainly influenced by the performance of the Brazilian economy, the toll
collection starts at the Mairiporã’s toll plaza in Fernão Dias’ highway, in September 2010, and the implementation of
bidirectional collection in four toll plazas in Centrovias concessionaire, located at the municipality of Brotas, Dois
Córregos, Itirapina and Rio Claro, in July and November 2010.
Vehicle-Equivalents 1Q11 4Q10 1Q10Var%
1Q11/4Q10
Var%
1Q11/1Q10
State Concessions 42,004,545 43,368,736 34,922,349 -3.1% 20.3%
Autovias 9,949,949 10,804,999 9,369,499 -7.9% 6.2%
Centrovias 11,064,688 9,740,527 5,903,316 13.6% 87.4%
Intervias 13,367,517 14,627,675 12,615,450 -8.6% 6.0%
Vianorte 7,622,391 8,195,535 7,034,084 -7.0% 8.4%
Federal Concessions 118,876,822 124,803,543 100,353,676 -4.7% 18.5%
Planalto Sul 7,094,193 6,969,184 6,233,449 1.8% 13.8%
Fluminense 11,549,643 12,195,769 10,462,909 -5.3% 10.4%
Fernão Dias 36,433,486 37,998,784 25,499,092 -4.1% 42.9%
Régis Bittencourt 34,831,167 36,507,333 32,024,667 -4.6% 8.8%
Litoral Sul 28,968,333 31,132,473 26,133,559 -7.0% 10.8%
Total 160,881,367 168,172,279 135,276,025 -4.3% 18.9%
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TOLL TARIFF
Var% Var%
Total 2,73 2,89 -5,5%
State Concessions
The increase of average toll tariffs of the Autovias, Intervias and Vianorte concessionaires is explained by the contractual
adjustment based on the IGP-M. At Centrovias, despite the contract adjustment, average toll tariff dropped 41.2% due to
the fact that toll collection switched to bidirectional (both side directions) in four plazas, and toll tariff were reduced by
50%.
Federal Concessions
In the months of December 2010 and February 2011, the toll tariffs charged by federal concessionaires were adjusted
according to (i) the criterion for rounding the first decimal place, and the cumulative variation of the IPCA in the 12 months
prior to adjustments. The result of this adjustment increased the average tariff applied by federal concessionaires, which rose
from R$ 1.51 to R$ 1.66 (+9.7%).
Average Toll Tariff (R$ / Vehicle-Equivalents) 1Q11 4Q10 1Q10Var%
1Q11/4Q10
Var%
1Q11/1Q10
State Concessions 5.65 5.92 6.14 -4.6% -8.0%
Autovias 5.96 5.94 5.75 0.4% 3.8%
Centrovias 5.38 6.55 9.15 -17.8% -41.2%
Intervias 4.88 4.88 4.70 0.1% 3.9%
Vianorte 6.98 7.01 6.73 -0.4% 3.8%
Federal Concessions 1.66 1.50 1.51 10.6% 9.7%
Planalto Sul 3.10 2.93 2.90 5.9% 6.9%
Fluminense 2.73 2.60 2.56 4.9% 6.4%
Fernão Dias 1.30 1.13 1.10 15.1% 18.2%
Régis Bittencourt 1.70 1.50 1.50 13.3% 13.3%
Litoral Sul 1.28 1.20 1.17 6.4% 8.8%
Total 2.70 2.64 2.71 2.3% -0.2%
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GROSS SERVICE REVENUE
State
The state concessionaires accounted for 54.6% of the total amount collected from tolls, closing the first quarter of 2011 with
R$ 237.3 million (+10.7%). The main reason was the tolled traffic growth of Centrovias, reflecting the implementation of
bidirectional charging the toll plazas in the towns of Brotas, Dois Córregos, Itirapina and Rio Claro.
Federal
The federal concessionaires reported in 1Q11 revenue of R$ 197,1 million (+29.9%), R$ 45.4 million more than 1Q10. The
main reasons for the revenue growth were: the opening of the toll plaza of Mairiporã (SP), located at Fernão Dias, which
accounts approximately 21.3% of all traffic tolled the concessionaire, adjustment of the basic rates charged by Planalto Sul,
Fernão Dias, Régis Bittencourt, Fluminense and Litoral Sul.
GROSS SERVICE REVENUE 1Q11 4Q10 1Q10Var%
1Q11/4Q10
Var%
1Q11/1Q10
GROSS SERVICE REVENUE 601,596 627,534 504,169 -4.1% 19.3%
Toll plazas revenue 434,400 443,856 366,141 -2.1% 18.6%
State 237,332 256,730 214,485 -7.6% 10.7%
Autovias 59,337 64,148 53,837 -7.5% 10.2%
Centrovias 59,521 63,775 54,024 -6.7% 10.2%
Intervias 65,239 71,326 59,279 -8.5% 10.1%
Vianorte 53,235 57,481 47,345 -7.4% 12.4%
Federal 197,068 187,126 151,656 5.3% 29.9%
Planalto Sul 21,992 20,393 18,078 7.8% 21.7%
Fluminense 31,509 31,709 26,825 -0.6% 17.5%
Fernão Dias 47,364 42,904 28,049 10.4% 68.9%
Régis Bittencourt 59,213 54,761 48,037 8.1% 23.3%
Litoral Sul 36,990 37,359 30,667 -1.0% 20.6%
Others 24,163 25,093 16,701 -3.7% 44.7%
Construction services 143,033 158,585 121,327 -9.8% 17.9%
DEDUCTIONS FROM REVENUE (42,258) (42,985) (34,626) -1.7% 22.0%
NET SERVICE REVENUE 559,338 584,549 469,543 -4.3% 19.1%
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ELETRONIC PAYMENT SYSTEMS (AVI)
50.7%
53.0%53.7% 53.8% 53.9%
56.0%56.7%
57.3%58.0%
1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11
AVI State Concessions
25.0%27.5% 29.6% 30.2% 31.6%
35.4% 36.9% 38.1% 39.8%
1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11
AVI Federal Concessions
Eletronic Collection
The revenue from the electronic payment systems (AVI System) at state concessionaires’ toll plazas accounted for 58.0% of
total revenue in 1Q11 against 53.9% recorded in 1Q10. In the federal concessionaires the average percentage of revenue
from electronic billing was 39.8% versus 31.6% in 1Q10.
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EBITDA and Adjusted EBITDA
EBITDA
The operating income as measured by EBITDA amounted to R$ 212.8 million in 1Q11, showing an increase of 15.9% in
comparison with 1Q10. The increase of R$ 29.3 million reflects growth of R$ 89.8 million (+19.1%) on the net revenue and
the increased costs and expenses for the period.
Adjusted EBITDA
Adjusted EBITDA for 1Q11 totaled R$ 251.2 million, indicating growth of 23.8% compared to 1Q10. As a consequence, the
margin increased 1.7 percentage point.
1Q11 4Q10 1Q10Var%
1Q11/4Q10
Var%
1Q11/1Q10
NET REVENUE 559,338 584,549 469,543 -4.3% 19.1%
Cost and expenses (excl. depreciation and amortization) (346,502) (374,992) (285,968) -7.6% 21.2%
EBITDA 212,836 209,558 183,575 1.6% 15.9%
EBITDA Margin 38.1% 35.8% 39.1%
(+) Provision for maintenance in highways 49,371 57,581 25,217 -14.3% 95.8%
(-) Consolidation Adjustments (11,050) (11,670) (5,856) -5.3% 88.7%
Adjusted EBITDA (before IFRS) 251,157 255,469 202,936 -1.7% 23.8%
EBITDA Margin 44.9% 43.7% 43.2%
EBITDA
(In thousands of Brazilian reais)
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8.6%10.7%
11.7%
1Q10 4Q10 1Q11
2.05%
2.21%
2.42%
1Q10 4Q10 1Q11
2.75%
3.15%
2.41%
1Q10 4Q10 1Q11
FINANCIAL RESULT
IGP-M - Quartely
IPCA – Quartely
CDI – Quartely Average
Net Finance Income / Costs (R$ thousand) 1Q11 4Q10 1Q10Var%
1Q11/4Q10
Var%
1Q11/1Q10
Finance Income 37,004 30,680 10,083 20.6% 267.0%
Finance Costs (97,606) (91,767) (58,693) 6.4% 66.3%
Finance charges (80,220) (72,106) (40,656) 11.3% 97.3%
Inflation adjustment of concession fee (12,298) (14,957) (13,625) -17.8% -9.7%
Other expenses (5,088) (4,704) (4,412) 8.2% 15.3%
Net Exchange Variation (63) - (320) - -80.3%
Net Financial Result (60,665) (61,087) (48,930) -0.7% 24.0%
RESULTS
In comparison with 4Q10, the net financial result in 1Q11 decrease of R$ 422 thousand. The
effect was caused primarily by changes in the interest rate of debt and financial applications.
Compared to 1Q10, the net financial result negative increased 24.0% , from R$ 48,9 million to
R$ 60,7 million.
The main factors contributing to such variation include:
Increase of R$ 39.6 million in financial charges generated by the issue of debentures which
were realized by state concessionaires;
Reduction of R$ 1.3 million in "Monetary Correction of Fixed Concession Charge“ caused by
the decrease in the IGP-M inflation index;
Increase of R$ 26.9 million in revenues from financial investments due to the increase of CDI.
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NET INCOME
RESULTS EVOLUTION
Main Factors Leading
In 1Q11, the consolidated net income grew 11.9% over the previous quarter. The main factors leading to the increase were:
star-up of 100% of the toll plazas operation in federal concessions, contractual tariff adjustments, and two-way
charging at the Centrovias toll plazas.
63.3 78.0
70.8
1Q10 4Q10 1Q11
11.9%
11
36.3%
50.5%
13.1%
TJLP CDI IPCA
36.3%
63.0%
0.7%
BNDES Debentures Others
INDEBTNESS
GROSS INDEBTNESS (R$ MN) LEVERAGE RATIO AND NET DEBT (R$ MN)
DEBT COST BREAKDOWN AMORTIZATION SCHEDULE OF DEBENTURES (R$ MN)
1,158 1,197 735
947
1,784
1,186 1,281 1,234 873
267
739
922 847
37 1,287 1,223
1,554 1,882 1,425
1,936
1,657 1,794 1,822
2,474 2,504
2,789 2,754
1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11
Short Term Long Term
1,174 1,291 1,325 1,346 1,354 1,450 1,455 1,523 1,453
2.5 2.6 2.4
2.2 1.9 1.8 1.7 1.7
1.6
(2,0)
(1,5)
(1,0)
(0,5)
-
0,5
1,0
1,5
2,0
2,5
3,0
-
500
1.000
1.500
2.000
1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11
Net Debt Net Debt / Ajusted EBITDA - Fixed Concession Charge (last 12 months)
250.8
335.1 335.8
278.4
118.0 118.1
2012 2013 2014 2015 2016 2017
76.3% of long-term debt consisted of debentures
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INDEBTNESS
BNDES Long Term Loan (Federal Concessions)
On March 31, 2011, two such bridge loan agreements relating to the concessionaires Autopista Régis Bittencourt and
Autopista Planalto Sul were replaced by long-term debt. The following conditions approved:
Until March 31, 2011, R$ 414,3 million were disbursed as long term loans for the concessionaires Autopista Régis Bittencourt
and Autopista Planalto Sul.
The long-term financing from BNDES to concession companies Autopista Fernão Dias, Autopista Litoral Sul and Autopista
Fluminense are being examined by BNDES.
BNDES Bridge Loan (Federal Concessions)
Until March 31, 2011 R$955.4 million already has been disbursed, with R$541.1 million as bridge loans for the
concessionaires Autopista Fluminense, Autopista Litoral Sul and Autopista Fernão Dias.
CREDIT A CREDIT B CREDIT A CREDIT B CREDIT C
R$ 446,395,000 R$ 623,100,00 R$ 184,057,000 R$ 90,007,000 R$ 57,280,000
Amort. 144 months Amort. 126 months Amort. 144 months Amort. 138 months Amort. 120 months
Grace Period: 12 months Grace Period: until 06/15/14 Grace Period: 18 months Grace Period: until 06/15/14 Grace Period: until 12/15/15
Cost TJLP + 2.21% p.a Cost TJLP + 2.21% p.a Cost TJLP + 2.58% p.a Cost TJLP + 2.58% p.a Cost TJLP + 2.58% p.a
RÉGIS BITTENCOURT RÉGIS BITTENCOURT
Total: 1,069,495,000 Total: 331,344,000
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CAPEX AND MAINTENANCE
Intangible and
Property (A)
Maintenance
Realized (B)
Intangible and
Property (A)
Maintenance
Realized (B)
Autovias 5,967 286 5,681 5,140 1,580 3,560
Centrovias 6,451 3,632 2,819 10,240 7,582 2,658
Intervias 16,748 1,868 14,880 6,042 2,963 3,079
Vianorte 8,542 1,896 6,646 9,990 3,245 6,745
State Concessions 37,708 7,682 30,026 31,412 15,370 16,042
Planalto Sul 18,717 18,717 - 13,035 13,035 -
Fluminense 19,115 19,115 - 9,301 9,301 -
Fernão Dias 34,164 34,164 - 26,473 26,473 -
Régis Bittencourt 39,883 39,883 - 27,693 27,693 -
Litoral Sul 25,641 25,641 - 15,192 15,192 -
Federal Concessions 137,520 137,520 - 91,694 91,694 -
Total 175,228 145,202 30,026 123,106 107,064 16,042
Others invest. and consolidation adjustments 2,913 2,913 - 6,281 6,281 -
Total 178,141 148,115 30,026 129,387 113,345 16,042
1Q11 1Q10
IFRSCapex
Cash Flow (R$ Thousand)
Before
IFRS (A + B)
IFRSBefore
IFRS (A + B)
Investments in Intagible Assets
OHL Brazil companies invested about R$ 148.1 million in fixed and intagible assets in 1Q11, a significant portion of that amount
(92.8%) was allocated to projects conducted by federal concessionaires, R$ 137.5 million, standing out duplication of Serra do
Cafezal, implantation of pedestrian crossing, implementation of marginal and recovery of pavement.
Maintenance of Roads
Regarding state concessionaires, it was spent R$ 30,0 million in maintenance work for state highways which, in turn, have
already reached an advanced stage of maturity, investmentwise.