embraer 4 q09 results_final
TRANSCRIPT
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Forward Looking StatementForward Looking Statement
This presentation includes forward-looking statements or statements about events or circumstances
which have not occurred. We have based these forward-looking statements largely on our current
expectations and projections about future events and financial trends affecting our business and our
future financial performance. These forward-looking statements are subject to risks, uncertainties and
assumptions, including, among other things: general economic, political and business conditions,
both in Brazil and in our market. The words “believes,” “may,” “will,” “estimates,” “continues,”
“anticipates,” “intends,” “expects” and similar words are intended to identify forward-looking
statements. We undertake no obligations to update publicly or revise any forward-looking statements
because of new information, future events or other factors. In light of these risks and uncertainties,
the forward-looking events and circumstances discussed in this presentation might not occur. Our
actual results could differ substantially from those anticipated in our forward-looking statements.
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Highlights 2009
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Solid net cash position of US$ 500 million.
Successful US$ 500 million, ten-year bond issued at attractive rates.
Company Highlights 2009Company Highlights 2009
Fifth consecutive year listed in the BM&FBOVESPA Sustainability Index (ISE).
All operational targets achieved.
In 2009, Embraer completed 40 years of existence with more than 5 thousand aircraft produced and operating in 78 countries.
Effective restructuring preserving Company’s operational, economical and financial solidness.
20% reduction of SG&A. Significant inventory reduction of US$ 0.5 billion.
Reduction in Capex but preserving strategic investments.
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Company Highlights 2009Company Highlights 2009
Landmark development contract for KC390 aircraft.
Solid progress of P3E and technological development.
Phenom 300 was certified on schedule (December 2009), meeting or surpassing all of its performance goals.
Embraer’s market share in the bizjet market increased from 3% to 14% (deliveries) and 4% to 6.5% (revenues).
Successful ramp up of Phenom 100 and Lineage 1000.
Financing secured for all commercial jet deliveries.
First flight of Legacy 650.
7641,354
1,837
2,762 2,9272,526
2,144
3,4413,830 3,760
5,245
6,335
5,466
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
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Net Revenue Net Revenue (US GAAP)(US GAAP)
US$ Million
Guidance Delivered
60
160 161131
101
148 141 130
169
204
244
96
32
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
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Aircraft DeliveriesAircraft Deliveries
* Phenom Jets
*2
*98
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Firm Order BacklogFirm Order Backlog
US$ Billion
3.0 4.16.4
11.4 10.79.0
10.6 10.1 10.4
14.8
20.9
16.618.8
2.2 2.2 2.3
3.94.2 4.2
3.12.6 2.8 2.8 3.0
3.8
3.3
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Firm Order Backlog Backlog/Revenue (Years)
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Revenue BreakdownRevenue Breakdown
Revenue by Segment Revenue by Region
64% 67% 62%
7%8%
9%
16%14%
16%
10% 9% 11%3% 2%2%
2007 2008 2009
46% 43%
23%
24%18%
32%
12%
10%7%
4%
4%11%
6%18% 21%
8% 7% 6%
2007 2008 2009
Commercial aviationExecutive aviation
OthersAviation services
Defense North America
Brazil
EuropeAsia Pacific
Latin AmericaOthers
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Financial Results
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Net Revenues and Net Revenues and Gross MarginGross Margin
US Gaap - US$ Million
Net Revenues Gross Margin
5,2456,335
5,466
20.4%
21.2%22.0%
2007 2008 2009
BR Gaap - R$ Million
9,99410,813
11,747
19.2%
20.5%20.5%
2007 2008 2009
731603
425
376
2008 2009
393305
232
191
2008 2009
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SG&A ExpensesSG&A Expenses
625
496
Selling Expenses General and Adm. Expenses
1,156
979
US Gaap - US$ Million BR Gaap - R$ Million
336
537
374
8.5%
7.1%6.1%
2007 2008 2009
275
66
4.1%
15.1%
4Q08 4Q09
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Income from Operations Income from Operations (US GAAP)(US GAAP)
US Gaap - US$ Million US Gaap - US$ Million
Income from Operations Operating Margin
103
8.0%
103
10.5%
732
1,113938
9.5%9.4%
6.8%
2007 2008 2009
436
60
2.2%
10.5%
4Q08 4Q09
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Income from Operations Income from Operations (BR GAAP)(BR GAAP)
179
8.4% 8.6%
179
BR Gaap - R$ Million BR Gaap - R$ Million
Income from Operations Operating Margin
1,3221,500
1,157
10.7%
12.8%13.2%
2007 2008 2009
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EBITDAEBITDA
US Gaap - US$ Million BR Gaap - R$ Million
EBITDA EBITDA Margin
433
608
422
7.7%
9.6%
8.3%
2007 2008 2009
103
9.6%
179
12.3%
249
389
489
9.3%
4.5%
6.1%
2007 2008 2009
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Net Income Net Income (US GAAP)(US GAAP)
Net Income Net Margin
US Gaap - US$ Million US Gaap - US$ Million
112
146
9,1%
6,1%
4Q08 4Q09
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Net Income Net Income (BR GAAP)(BR GAAP)
Net Income Net Margin
BR Gaap - R$ Million
895
429
1,185
8.3%
3.6%
11.9%
2007 2008 2009
BR Gaap - R$ Million
(41)
168
6,0%
-1,0%
4Q08 4Q09
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InventoriesInventories
US Gaap - US$ Million
2,340
2,837
2,491
2007 2008 2009
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Indebtedness ProfileIndebtedness Profile
Total Debt 4Q09: US$ 2,043 Million
52% 53%
29% 27%
71%71% 73%
29%47%48%
4.9
2.62.1
3.53.3
4Q08 1Q09 2Q09 3Q09 4Q09
Long-term Short-term Loans Average Maturity (Years)
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Operating Cash Flow Operating Cash Flow InvestmentsInvestments
US Gaap - US$ Million
(244)
(64)
404
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1Q09 2Q09 3Q09 4Q09
Investments - US$ 247 million:
• R&D: US$ 144 million;
• PP&E: US$ 103 million.
Below
Budget
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Net CashNet Cash
US Gaap - US$ Million
376
12252 71
503
4Q08 1Q09 2Q09 3Q09 4Q09
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2010 Outlook
and Guidance
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2010 Outlook2010 Outlook
Commercial aviation: some hope on the horizon, but structural concerns still.
Business aviation: some indicators showing positive trend.
Embraer growing its market share.
Defense business resilient.
Embraer benefiting from Brazil’s growth / global insertion.
Company’s operations, productivity, quality and employee moral in good
shape and improving – P3E in full force.
Investments in technological development producing concrete results and
paving the future.
Embraer with increasingly solid strategic positioning.
Readiness to leverage results when markets rebound.
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2010 Guidance2010 Guidance
Net revenues - US$ 5.0 billion
• Commercial aviation: US$ 2.6 billion
• Executive aviation: US$ 1.1 billion
• Defense: US$ 650 million
• Services and others: US$ 650 million
EBIT - US$ 300 million
EBIT margin - 6.0%
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Other Relevant EstimatesOther Relevant Estimates
2010 projected deliveries
• 90 commercial jets
• 137 business jets
• 17 Legacy / Lineage
• 120 Phenom
Investments - Budget US$ 300 million
• R&D: US$ 160 million
• PP&E: US$ 140 million
EBITDA - US$ 375 million
EBITDA margin - 7,5%
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