Apresentação institucional eng

1August, 2012

2

1.Company overview

2.Main business divisionsCar rental

Fleet rental

Seminovos

3.Consolidated

4.Debt and cash

5.Key value drivers

Agenda

3

Company: milestones

1973 1982 1983 20041990 2005 2011

Phase I – Rise to #1

1973 – Founded in Belo Horizonte/MG

Late 70’s - Acquisitions in the Northeast of Brazil

1981 – Brazilian car rental leader in # of branches

Phase II – Expansion

1984 – Expansion strategy by adjacencies: Franchising

1991 – Expansion strategy by adjacencies: Seminovos

1997 – PE firm DL&J enters at a market cap of US$ 150 mm

1997 – Expansion strategy by adjacencies: Fleet rental

Phase III – Reaching Scale

2005 – IPO: market cap of US$ 295 mm

2011 – Rated as investment grade by Moody’s, Fitch and more recently S&P

2012 – ADR level I

06/30/2012 – Market cap pf US$3.1 biwith ADTV of 37.1 million

4

100.0%100.0%100.0%

Company: Ownership breakdown

Salim Mattar Eugenio Mattar Antonio Claudio Resende

Flavio Resende Free-float

7.1% 66.3%10.5%7.1%9.0%

Founders

5

Company: integrated business platform

This integrated business platform gives Localiza flexibility and superior performance.

Synergies:bargaining powercost reduction cross selling

13,389 cars201 locations in Brazil 48 locations in South America34 employees

66.6% sold to final consumer71 stores951 employees

58,436 cars3.1 million clients253 locations4,057 employees

31,412 cars699 clients343 employees

Based on the 2Q12

6

Company: Business platform divisions

Car rental

Localiza car rental rents to individuals or businesses at airports and other locations.

The traditional backbone of Localiza. With its giant fleet that gets renewed annually, it lays the foundation for all scale effects captured by the group as a whole.

Fleet management

Total Fleet, offering customized fleet for terms of 2-3 years.

Total Fleet is seen as an additional business that generates value by leveraging synergies created by the integrated platform approach.

Used car sales

Support area, with the objective to sell the Company’s used cars and add know-how in buying cars and to estimate the residual value.

As a support business activity, Seminovos enables the sell 70% of used cars directly to the final customer, thereby maximizing the residual value of used rental cars.

Franchising

Supplementary business, with the purpose to expand the brand’s network.

Franchising is seen as a primarily strategic business by management – the revenues generated are low, however brand and network expand at minimum capital expenditure.

7

1.Company overview


Fleet rental

Seminovos

3.Consolidated

4.Debt and cash

5.Key value drivers

Agenda

8

Overview

64.688

47.517

35.686

2011

2009

2007

Corporate fleet size

247

214

178

2011

2009

2007

Corporate locations

Financial performance

428.0585.2

980.7

-5 0 0 .0 0

-3 0 0 .0 0

-1 0 0 .0 0

1 0 0 .0 0

3 0 0 .0 0

5 0 0 .0 0

7 0 0 .0 0

9 0 0 .0 0

1 ,1 0 0 .0 0

2007 2009 2011-1 0 .0 %

4 0 .0 %

9 0 .0 %

Car rental net revenues EBITDA margin (%)

*Source: each company website (May, 2012)

CAGR: 23.0%

46.0% 41.9% 46.9%

63.1%Compact cars

Fleet composition

36.9%Others

9

71 6032

Overview

Source: Each company’s website as of May, 2012.

Localiza holds an extraordinarily strong position in the Brazilian market, as over decades it has been successfully competing against major global players through local scale.

279 312 346 381 415 449 452

254

2005 2006 2007 2008 2009 2010 2011 1H12

Car rental distribution (Brazil)

120

107

62

# of branches # of cities452

289

Localiza Hertz Unidas Avis

318

10Source: ABLA (Brazilian Car Rental Association) and each company’s website (May, 2012)

Off-airport market is still fragmented.

Airport locations Off-airport locations

Car rental locations in Brazil

Others36Avis

35

Unidas34

Localiza101

Hertz42

Avis27

Unidas73

Localiza351 Hertz

78

Others2079

Overview

36.5%

Car Rental market share - Brazil (# of cars)

11

Main competitors

Market share* 3.1%

35

27

• International brand• Local expertise

• Weak footprint in Brazil• Master franchisee in Brazil in

“Chapter 11”• Used car sales retail network

Airport locations

Off-airport locations

Strengths• Capitalized by three

Private Equity funds• Local expertise

• International brand• Local expertise

Weaknesses

6.7% 2.8%

42

78

• Weak footprint in Brazil• Used car sales retail network

34

73

• Weak footprint• Relatively weak brand• Unclear priorities between

rental and fleet business• Used car sales retail

network

*Source: Roland Berger report, as of June 21, 2012, based on 2010 figures

12

Drivers

71128 154 179

2003 2009 2010 2011

80.3%20.3% 16.2%

Air traffic passengers - million

GDP per capita (R$ thousands)

6.9 7.5 8.4 9.5 10.7 11.7 12.8 14.216.0 16.6

19.0 21.3

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

151

260

465510

545

645

240180 200

350415

380

300

18% 16% 15% 13%

31%

35%

15%

37%38%

51%

22% 20%27%

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012e

Monthly minimum salary (R$) Daily rental price over minimum salary (%)

Car rental affordability

Investments in Brazil

679

343

18285 83 107

Oil/gas

Transp

ortatio

n

Energ

yWate

r/sew

age

Industry

Others

13

2011 - Would you recommend Localiza? YES!

Customers recognize premium service and recommend it!

94.6% 94.8% 96.0% 95.5% 95.3% 96.3% 95.9%

2005 2006 2007 2008 2009 2010 2011

Source: based on “Fale Fácil” satisfaction survey answered by more than 350,000 customers in 2011

95.9%

Satisfaction survey

14

$27.5Car acquisition

Net car sale revenue $26.4

1 2 3 4 5 20 21 22 23 24

1 - year cycle

Expenses, interest and tax

Revenue

Financial cycle

Spread10,3p.p.

Totalper year

R$ % R$ % R$Net Revenues 19,1 100,0% 29,2 100,0% 48,3 Cost s (7,4) - 0,0% (7,4) SG&A (2,7) -14,1% (2,8) -9,6% (5,5) Net car sale revenue 26,4 90,4% 26,4 Book value of car sale (25,7) -90,0% (25,7)

EBITDA 9,0 47,2% 0,7 2,4% 9,7 Depreciation (vehicle) (2,0) -6,8% (2,0) Depreciation (non-vehicle) (0,3) -1,6% (0,3) Interest on debt (2,4) -8,2% (2,4) Tax (2,7) -14,2% 1,1 3,8% (1,6)

NET INCOME 6,0 31,5% (2,6) -8,9% 3,4

NOPAT 5,2 ROIC 18,9%Cost of debt after tax (CDI+1,5%) 8,6%

Fleet Rental Seminovosper operating car per operating car2011

15

Figures

Renting cars 2010 2011

EBIT 282.2 356.9

EBT 195.1 233.1

Net revenues 802.2 980.7460.3

(103.4)

(123.8)

EBITDADepreciation

Financial expenses (87.1)

363.3(81.1)

2010 2011

9.5 10.1

4.5 4.5

18.7 19.19.0

(2.0)

(2.4)

8.5(1.9)

(2.0)

Selling cars 2010 2011

EBIT 27.0 23.9EBT 27.0 23.9

Net revenues 1,101.1 1,241.130.0(6.1)

EBITDADepreciation

32.1(5.1)

2010 2011

0.7 0.60.7 0.6

27.8 29.20.7

(0.1)0.8

(0.1)

Per operating car

Per car sold

End of period fleet 61,445 64,688

Average rented fleet 29,646 35,348Average operating fleet 42,903 51,285

- -

- -- -

Number of cars sold 39,658 42,483 - -

16

Net revenues (R$ million)

# daily rentals (thousand)

3,4114,668

5,7937,940 8,062

10,73412,794

6,243 6,664

3,179 3,334

2005 2006 2007 2008 2009 2010 2011 1H11 1H12 2Q11 2Q12

CAGR: 24.6%

4.9%6.8%

258.6346.1

428.0565.2 585.2

802.2980.7

472.4 532.3

239.4 264.3

2005 2006 2007 2008 2009 2010 2011 1H11 1H12 2Q11 2Q12

CAGR: 24.9%

10.4%12.7%

Volumes and revenues

Revenue grew above volume due to the increase in the average rental rate per car.

17

74.2%68.9%68.9%69.1%68.8%67.9%70.7%65.5%58.8%

2005 2006 2007 2008 2009 2010 2011 1Q11 1Q12

58,43663,50064,68861,44547,517

39,11235,68631,37324,103

2005 2006 2007 2008 2009 2010 2011 1H11 1H12

CAGR: 17.9% -8.0%

Utilization rate

Fleet

Fleet and utilization rate

18

Financial crisis effectHot used car market 5.468,2

2.062,31.683,91.536,0332,9

2.546,0 2.577,0939,1492,3

2005 2006 2007 2008 2009 2010 2011 Jan-Apr/12* 1H12** Annualized

Reflex of the

IPI reduction

Reflex of the

IPI reduction

Depreciation was impacted by the decrease in car prices due to the IPI reduction.

Average depreciation per car

Additional estimated depreciationDivision

2Q12

85 (*) 31 116

73%

After 2Q12 Total

Car rental27% 100%

Quantity of cars by year of maturity of estimated useful life

0%

5

2015

0%

143

2014

57,82112,18745,486

79%

2012 Total2013

100%21%

R$ million Fleet as of May, 2012

Additional depreciation related to the IPI reduction on May, 2012

(*) Additional estimated depreciation of R$31 million will be accounted prospectively in the next 12 months

19

1.Company overview


Fleet rental

Seminovos

3.Consolidated

4.Debt and cash

5.Key value drivers

Agenda

20

687

584

456

2011

2009

2007

Number of clients

Overview

31,629

22,778

17,790

2011

2009

2007

Fleet size

Financial performance

219.8303.2

455.0

0 .0 0

5 0 .0 0

1 0 0 .0 0

1 5 0 .0 0

2 0 0 .0 0

2 5 0 .0 0

3 0 0 .0 0

3 5 0 .0 0

4 0 0 .0 0

4 5 0 .0 0

5 0 0 .0 0

2007 2009 2011

5 0 .0 %

1 0 0 .0 %

Fleet rental net revenues EBITDA margin (%)

CAGR: 19.0%

71.3% 68.7% 68.6%

42.6%Compact cars

Fleet composition

57.4%Others

21

13.9%

Fleet Rental division - Brazil (# of cars)

Source: based on ABLA 2012 yearbook

The business greatly profits from synergies with its car rental affiliate, and as the Brazilian economy matures, one can expect a higher percentage of companies to take advantage of fleet rental.

Overview

22

Main competitors

Market share* 7.1%

204.7

16,418

• Capitalized• Synergies with its rental car

business area

• Loss making in the last six years (competing on price in the pursuit of market share)

• Used car sales retail network

Revenues (R$ million)

Fleet size

Strengths • Brazil’s second player• Successful IPO 04/2012

Weaknesses

9.5%

272.5

27,262

• Low profitability (competing on price in the pursuit of market share)

• Depreciation calculus• Used car sales retail network

*Source: Roland Berger report, as of June 21, 2012, based on 2011 figures.

23Source: ABLA and Datamonitor

Less than 50% of targeted fleet is rented.

Outsourced fleet penetration

Corporate fleet:4,200,000

Targeted fleet:500,000

Rented fleet:245,000

31,629

Brazilian Market World

5.4%8.9%

13.3%16.5%

24.5%

37.4%

46.9%

58.3%

Brazil

Poland

Czech

Repu

blic

German

y

France

Spain Uk

Holland

Drivers

24



1 2 3 4 5 20 21 22 23 24Expenses, interest and tax

Revenue

Financial cycle

Spread7,6p.p.

Totalper year

R$ % R$ % R$Net Revenues 16,3 100,0% 28,6 100,0% 44,9 Costs (4,2) - 0,0% (4,2) SG&A (0,9) -5,5% (2,3) -8,0% (3,2) Net car sale revenue 26,3 92,0% 26,3 Book value of car sale (24,9) -90,0% (24,9)


NET INCOME 7,8 47,8% (3,4) -11,7% 4,4


Fleet Rental Seminovosper operating car per operating car2011

2 - year cycle

25

Renting cars 2010 2011

EBIT 164.5 196.3

EBT 121.1 139.3

Net revenues 361.1 455.0312.1

(115.8)

(57.0)

EBITDADepreciation


245.6(81.1)

2010 2011

7.2 7.0

5.3 5.0

15.8 16.311.2(4.2)

(2.0)

10.7(3.5)

(1.9)

Selling cars 2010 2011

EBIT 2.2 11.4EBT 2.2 11.4

Net revenues 220.8 227.011.4

-EBITDADepreciation

2.3(0.1)

2010 2011

0.3 1.40.3 1.4

28.9 28.61.4

-0.3

(0.0)

Per car sold

End of period fleet 26,615 31,629

Average rented fleet 22,343 26,676Average operating fleet 22,916 27,858

- -

- -- -

Number of cars sold 7,627 7,929 - -

Figures

Per operating car

26

93.0%99.0%98.0%

Users VIP Users Contract managers

Customers recognize good service and recommend it!

Source: Users and VIP users based on phone interviews made by the Company with customers. Contract managers made by an independent research: Vox Populi

2011 - Would you recommend Total Fleet? YES!

98.0%

Satisfaction survey

27

Net revenues (R$ million)

# daily rentals (thousand)

3,351 4,1885,144

6,437 7,0998,044

9,603

4,625 5,248

2,372 2,637

2005 2006 2007 2008 2009 2010 2011 1H11 1H12 2Q11 2Q12

CAGR: 19.2%

11.2%13.5%

142.0184.0

219.8268.4

303.2361.1

455.0

215.7261.3

111.0 131.8

2005 2006 2007 2008 2009 2010 2011 1H11 1H12 2Q11 2Q12

CAGR: 21.4%

18.7%21.1%

Volumes and revenues

Revenues reflect the interest and depreciation assumptions at the time of the agreement.

28

97.7%96.1%95.8%97.5%96.8%94.0%96.1%96.5%96.9%

2005 2006 2007 2008 2009 2010 2011 1Q11 1Q12

31,41228,65431,629

26,61522,77823,403

17,79014,630

11,762

2005 2006 2007 2008 2009 2010 2011 1H11 1H12

CAGR: 17.9% 9.6%

Fleet

Fleet and utilization rate

Utilization rate

29

Average depreciation per car

5.406,34.289,34.133,0

3.509,7

2.395,8

5.083,14.371,7

2.383,32.981,3

2005 2006 2007 2008 2009 2010 2011 Jan-Apr/12* 1H12** Annualized

Reflex of the

IPI reduction

Additional estimated depreciationDivision

2Q12

15 (*) 49 64

23%

After 2Q12 Total

Fleet rental77% 100%

Quantity of cars by year of maturity of estimated useful life

13%

4,055

2015

37%

11,590

2014

31,28810,3035,340

17%

2012 Total2013

100%33%

R$ million Fleet as of May, 2012

Additional depreciation related to the IPI reduction on May, 2012

Depreciation was impacted by the decrease in car prices due to the IPI reduction.

(*) Additional estimated depreciation of R$49 million will be accounted prospectively throughout the prospective life of the cars

30

1.Company overview


Fleet rental

Seminovos

3.Consolidated

4.Debt and cash

5.Key value drivers

Agenda

31Source: Fenabrave 2011

Localiza launched Seminovos in 1993, a brand new concept featuring younger cars.

Overview

Combining the Localiza brand with a growing network of stores

enables the firm to continuously sell thousands of cars at market prices.

32

Used car sales net revenues

850.5 922.4

1,468.1

-1 0 0 .0 0

1 0 0 .0 0

3 0 0 .0 0

5 0 0 .0 0

7 0 0 .0 0

9 0 0 .0 0

1 ,1 0 0 .0 0

1 ,3 0 0 .0 0

1 ,5 0 0 .0 0

1 ,7 0 0 .0 0

2007 2009 2011

Overview

34.519

30.093

50.7722011

2009

2007

Cars sold

1.5% 10.6%

2011 Up to 2 years2011 Up to 2 years476,827476,827

2011 Brand news2011 Brand news3,425,4993,425,499

0.6%

2011 Used cars2011 Used cars8,862,9518,862,951

33

• Rental operators• Locamerica, Hertz

• Retailers• “Loja do carro”

• Often appeal to lower income classes, with older cars

• Occasionally specialized in niches

• No brand recognition (lower reputation market)

• Financing options with higher interest rates

Points of sale • 3,714 (Anfavea) • 95* • 45,600 (Fenauto) • 71 (Fenauto)

• Tailored to popular customer demand at purchase, hence likely to be an attractive value proposition when for sale

• Stigma about heavy usage during rental car years

• Weak retail network• Geographical

concentration (SP)• Lower media presence

Examples

Strengths

• Brand and perceived image/ experience

• Support often directly from the OEM’s

• Flexibility in trade-in cars• Strong media presence

• Comfort and convenience

• Variety of models and brands

• Flexibility in exchange

Weaknesses

• Dealers• Fiat, VW, Ford, GM most

successful

• “Auto malls” and “Cidade do automóvel”

• Lower media presence

• Cars often older than 2 years

• It hasn’t been successful

• Used cars not a core business

• Cars often older than 2 years

*Seminovos Localiza and main rentals, estimates

Main competitors

34

5.5

4.2

4.0

3.6

2.1

2.0

1.9

1.8

1.3

Brazil

Argentina

Russia

South Korea

Japan

France

Germany

United Kingdon

USA

# of inhabitants per car (2011)8.0 7.9

7.4

6.96.5

5.9

5.5

2005 2006 2007 2008 2009 2010 2011

Drivers

# of inhabitants per car - Brazil

7.9 8.9

11.9

15.817.4

6.85.6

7.0 8.98.47.17.37.1

6.7

3.53.33.02.72.31.81.6

2005 2006 2007 2008 2009 2010 2011

Individuals with affordability to buy a new car*

* Population with affordability to buy a new compact car (R$25,000) with 20% downpayment

Brazilian car market: new x used car market and affordability

4.4x 3.7x 3.1x 2.7x 2.4x 2.5x 2.6xNew cars

Used cars

35

Customers recognize our quality and recommend it!

94.0%92.3%94.0%

2009 2010 2011

Source: based on phone interviews made by the Company with customers started in 2009

2011 - Would you recommend Seminovos? YES!

94.0%

Satisfaction survey

36

Network increase

Used car sales network has increased by 5 stores.

# of points of sale

26 32 3549 55

66 71

13

2005 2006 2007 2008 2009 2010 2011 1H12

+5

37

Car sales per street storeMonthly average

82 82 82

59

74 73 70 74

2008 2009 2010 2011 1Q12 Apr-12 May-12 Jun-12

Number of sold cars is weighed by number of opened stores in the period

Productivity has improved, contributing to the reduction of fixed cost per car sold.

Car sold per store/month

38

1.Company overview


Fleet rental

Seminovos

3.Consolidated

4.Debt and cash

5.Key value drivers

Agenda

39

38%57%

5%

2011 Consolidated P&L

P&L 2010 2011

EBIT 482.1 595.7

Net revenues 2,497.2 2,918.1

EBITDA 821.3

(225.6)

(179.0)

416.7

Depreciation


EBT

649.5

(167.4)

352.0

Operating dataAverage operating fleet 65,819 79,143

Cars purchased 59,950

50,772Cars sold

65,934

47,285

16% 34%

50%

Revenues

EBITDA

40

26,10533,520 38,050

44,211 43,161

20,60218,763 23,17430,093 34,281 34,519

27,789

13,198

28,667

59,950

21,921

65,934

12,478 14,50424,059

47,285 50,772

2005 2006 2007 2008 2009 2010 2011 1H11 1H12 2Q11 2Q12

7,342 10,346 7,957

18,649

9,930 8,6424,608 (5,868)

9,178

8,124 (1,306)

690.0930.3 1,060.9

1,335.3 1,204.2

1,910.4 1,776.5

628.5 593.8379.0446.5 588.8

850.5 980.8 922.4

1,321.9 1,468.1

693.3 762.7

352.7 389.3

825.6

2005 2006 2007 2008 2009 2010 2011 1H11 1H12 2Q11 2Q12

243.5341.5 210.4

308.4354.5 281.8

588.5

132.3 (134.2)241.1 (10.3)

Net Investment

Purchased cars Sold cars* It does not include theft / crashed cars.

Fleet increase * (quantity)

Net investment (R$ million)

Purchases (accessories included) Net used car sales revenues

Car purchases were adjusted to improve fleet productivity.

41

31,373 35,686 39,112 47,517 61,445 64,688 63,500 58,43611,76214,630 17,790 23,403 22,778

26,615 31,629 28,654 31,412

24,103

2005 2006 2007 2008 2009 2010 2011 1H11 1H12

CAGR: 17.9%

35,86546,003 53,476 62,515 70,295

88,060 89,84892,15496,317

-2.5%

End of period fleetQuantity

Car rental Fleet rental

Fleet is adjusted to demand.

42

408.4 537.4 655.0 842.9 898.5 1,175.3 1,450.0694.6 801.6

353.7 400.3446.5 588.8

850.5980.8 922.4

1,468.1

693.3 762.7

352.7 389.3

1,321.9

2005 2006 2007 2008 2009 2010 2011 1H11 1H12 2Q11 2Q12

CAGR: 22.7%

854.91,126.2

1,505.51,823.7

2,918.1

1,820.9

2,497.2

706.4 789.6

1,387.9 1,564.3

15.4%

12.7%

13.2%

11.8%

Consolidated net revenuesR$ million

Rentals Seminovos

In the 2Q12, net revenues grew due to the increase of 13.2% in rental and 10.4% in Seminovos revenues

43

215.7200.6

425.7386.8

821.3649.5

469.7504.1403.5

311.3277.9

2005 2006 2007 2008 2009 2010 2011 1H11 1H12 2Q11 2Q12

7.5%

CAGR: 19.8%

10.1%

Margin per division 2005 2006 2007 2008 2009 2010 2011 1H11 1H12

45.3%

68.0%

52.3%

2.6%

45.1%

67.1%

52.0%

3.7%

41.3%

66.0%

49.4%

3.9%

46.9%

68.6%

53.8%

2.8%

45.9%

69.1%

53.3%

5.6%

2Q11 2Q12

40.6%

65.8%

Rental consolidated 53.6% 52.9% 54.5% 51.1% 53.1% 48.9%

5.1%

46.1%

68.5%

3.6%

41.9%

68.7%

1.1%

43.4%

71.4%

4.6%

46.0%

71.3%

5.5%

Car rental 47.5%

Fleet rental 65.5%

Seminovos 13.2%

EBITDA R$ million

EBITDA margin in the 2Q12 was impacted by complement bonuses and accessories expenses.

44

10.7

74.083.4137.6

291.6250.5

116.3127.4190.2

138.2106.5

2005 2006 2007 2008 2009 2010 2011 1H11 1H12 2Q11 2Q12

16.4%

-39.4%-85.5%

Consolidated net incomeR$ million

EBITDA x net income Reconciliation 2009 2010 2011 Var. R$ 1H11 1H12 Var. R$ Var. % Var. R$

171.8 386.8

(89.7)

(12.3)

(88.0)

(59.2)

137.6

(55.2)

15.1 10.1%38.9425.7

(223.3) (122.0)

(15.6)

(77.7)

148.9%

(25.7)

(133.6)

(3.3)

10.3

33.5

26.8%

-11.7%

83.4 (54.2)

-56.6%

-39.4%

(1.8)

11.1

34.3

(63.3)

(3.0)

(48.9)

(23.6)

41.1

821.3

(201.5)

(24.1)

(179.0)

(125.1)

291.6

Var. %

26.5%

37.7%

14.2%

37.6%

23.3%

16.4%

469.7

(172.3)

(21.0)

(112.9)

(47.2)

116.3

649.5

(146.3)

(21.1)

(130.1)

(101.5)

250.5

2Q11 2Q12 Var. %

Consolidated EBITDA 200.6 215.7 7.5%

281.8%

28.6%

-24.6%

-107.9%

-85.5%

Car depreciation (43.3) (165.3)

Other property and equipment dep. (6.3) (8.1)

Financial expenses, net (45.2) (34.1)

Income tax and social contribution (31.8) 2.5

Net income 74.0 10.7

Excluding the additional depreciation, 1H12 net income would have reached R$149.5 million.

45

SWOT Analysis: Localiza business platform

• Unrivaled local scale

• Vertical integration, creating synergies for all four businesses

• Strong business operating performance and experienced leadership

• Strong footprint in Brazil’s extreme traffic locations

Strengths

Opportunities

Weaknesses

Threats

• Increase in market share through further consolidation of Brazilian rental car market

• Underdeveloped fleet outsorcing in Brazil

• Upcoming mega events in Brazil

• Positive outlook for Brazilian business and tourism

•Any measures of the Brazilian government which impact car sales prices, potentially lowering asset value (e.g. new car sales tax)

• New competitors entering the market (rental car or fleet management)

• Increasing fuel price

• Strong focus on airport locations

• Renewal of airport concessions costly

• Dependence on passengers travelling by air (growth limited by Brazilian infrastructure)

• Weak footprint outside of Brazil, resulting in exposure to national economic development

• Dependence on long-term capital to finance renewal of fleet

According to Roland Berger report as of June 21, 2012

Localiza’s brand is top of mind in Brazil.

Localiza doesn’t see it as a weakness or a threat

46

1.Company overview


Fleet rental

Seminovos

3.Consolidated

4.Debt and cash

5.Key value drivers

Agenda

4747

Free cash flow - FCF

Free cash flow - R$ million 2005 2006 2007 2008 2009 2010 2011 1H12

Change in accounts payable to car suppliers (capex) (25.5) 222.0 (51.0) (188.9) 241.1 111.3 32.7 (132.8)

Net capex for fleet growth (219.5) (65.0) (272.9) (488.8) 0.0 (429.0) (239.3) (132.8)Fleet increase – quantity 7,342 10,346 7,957 9,930 8,642 18,649 9,178 (5,868)

Net capex for renewal

EBITDA 277.9 311.3 403.5 504.1 469.7 649.5 821.3 425.7

Used car sales net revenues (446.5) (588.8) (850.5) (980.8) (922.4) (1,321.9) (1,468.1) (762.7)

Depreciated cost of used car sales (*) 361.2 530.4 760.0 874.5 855.1 1,203.2 1,328.6 687.7

(-) Income tax and social contribution (32.7) (42.7) (63.4) (52.8) (49.0) (57.8) (83.0) (54.9)

Working capital variation (24.2) (4.8) 13.3 (44.8) (11.5) 54.5 (83.9) (18.9)

Cash provided before capex 135.7 205.4 262.9 300.2 341.9 527.5 514.9 276.9

Used car sales net revenues 446.5 588.8 850.5 980.8 922.4 1,321.9 1,468.1 762.7

Capex of car - renewal (496.0) (643.3) (839.0) (1,035.4) (947.9) (1,370.1) (1,504.5) (628.5)

Capex – other property and equipment, net (28.0) (32.7) (23.7) (39.9) (21.0) (51.1) (63.0) (36.0)

Free cash flow before growth 58.2 118.2 250.7 205.7 295.4 428.2 415.5 375.1

Capex of car - growth (194.0) (287.0) (221.9) (299.9) (241.1) (540.3) (272.0) -

(49.5) (54.5) 11.5 (54.6) (25.5) (48.2) (36.4) 134.2

Free cash flow after growth (161.3) 53.2 (22.2) (283.1) 295.4 (0.8) 176.2 242.3

(*) Without tecnical discount deduction up to 2010 (see item 18 – Glossary)

48

Changes in net debt in 1H12 (R$ million)

Net debt was reduced by R$108.5 million (-8.0%).

- 1,254.9(78.9)

Interest

(54.9)

Dividends

Net debt 06/30/2012

FCF242.3

- 1,363.4

Net debt 12/31/2011

49

52.026.0

432.0562.0

303.5323.5161.8

16.5

2012 2013 2014 2015 2016 2017 2018 2019

Cash673,9

Debt profileR$ million

Debt profile in 06/30/2012- principal (R$ million)

Strong cash position and comfortable debt profile.

In the 1H12, all in spread was of 1.3p.p. above the Selic rate.

5050

END OF PERIOD BALANCE 2005 2006 2007 2008 2009 2010 2011(**) 1H12 (**)

Net debt / Fleet value 60% 36% 51% 72% 57% 52% 51% 52%

Net debt / EBITDA (*) 1.9x 1.4x 1.9x 2.5x 2.3x 2.0x 1.7x 1.5x

Net debt / Equity 1.4x 0.7x 1.3x 2.0x 1.5x 1.4x 1.2x 1.1x

EBITDA / Financial expenses, net 3.3x 4.8x 5.4x 3.8x 4.2x 5.0x 4.6x 5.5x

535.8 440.4765.1

1,254.5 1,078.61,281.1 1,363.4 1,254.9

900.21,247.7

1,492.91,752.6 1,907.8

2,446.7 2,681.7 2,391.2

2005 2006 2007 2008 2009 2010 2011 1H12

(*) annualized(**) From January 1st 2011, adress financial statements in IFRS

Debt – ratiosR$ million

Net debt Fleet value

The Company presents conservative indebtedness ratios.

51

1.Company overview


Fleet rental

Seminovos

3.Consolidated

4.Debt and cash

5.Key value drivers

Agenda

52

Adding value to shareholders

(1) (2) (3)(1)

Growth

(2)

Ability to sustain(competitive advantages)

(3)

1- Spread around 8p.p. on the invested capital above the cost of debt after taxes.

2- Growth: GDP elasticity has been 5.7x over the last 6 years.

3- Localiza’s competitive strengths: the competitive strengths in each step of the process allow the Company to grow profitably on a sustainable manner.

Key value drivers

SpreadROIC > DEBT COST

53

13,60%10,90%

8,40% 8,84% 7,59% 7,33% 8,60% 7,05%

24,80%

18,70%21,25%

17,03%

11,54%

16,94% 17,12%15,10%

2005 2006 2007 2008 2009 2010 2011 1H12annualized

Cost of debt after tax ROIC

Spread

2005 2006 2007 2008 2009 2010 2011

1,984.6 2,445.3

28.9%

0.59x

17.1%

8.60%

8.5

28.6%

0.59x

16.9%

7.33%

9.6

1,642.3

32.1%*

0.53x

17.0%

8.84%

Average capital investment - R$ million 606.3 986.2 1,137.5

8.2

1,702.3

21.9%

0.53x

11.5%

7.59%

4.0

2,645.6

NOPAT margin (over rental net revenues) 37.0% 34.5% 36.9% 24.9%*

Turnover of average capital investment (over rental net revenues) 0.67x 0.55x 0.58x 0.61x

ROIC 24.8% 18.7% 21.3% 15.1%

Interest on debt after tax 13.60% 10.90% 8.40% 7.05%

Spread (ROIC – Interest after tax) - p.p. 11.2 7.8 12.9 8.1

1H12 a

11.2p.p.7.8p.p. 12.9p.p.

8.2p.p.4.0p.p.

9.6p.p. 8.5p.p. 8.1p.p.

ROIC and spread reflect the Company’s competitive pricing strategy.

* Excludes additional fleet depreciation, following the concept recommended by Stern Stewart

54

2005 2006 2007 2008 2009 2010 2011

5.7x

Localiza

GDP

Sector

2.9x

GDP elasticity

Localiza’s competitive advantages resulted in a growth above the industry level.

Rental revenues real growth elasticity x GDP

55

331.4 408.4 537.4 655.0 842.9 898.5 1,175.3 1,450.0303.0 446.5

588.8850.5

980.8 922.4

1,321.91,468.1

515.7457.4402.7296.1234.1225.9212.9

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Average growth of EBITDA is in line with the average growth of rental revenues

Growth and profitability track record Consolidated revenues

Consolidated EBITDA

CAGR: 24.4%

CAGR: 15.9%

634.4854.9

1,126.21,505.5

1,823.7 1,820.9

2,497.22,918.1

Consolidated Rentals Used car sales

CAGR: 23.4%

4.3

42 62 85.2 134.3 154 149.9 152.1 197.8278.1 311.4

403.5504.1 469.7

649.5821.3

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

CAGR: 23.9%CAGR: 22.6%

-0.6 7.55.7 3.2 4.0 6.1 5.2

1.9Average

1.12.71.34.30.30.03.4GDP 2.9

56

Selling cars

Buying cars

Renting cars

Raising money

Ability to sustain: competitive advantages

brAAA

AA+ (bra)

Aa1.br

Localiza managed to close the cycle of the rental business through integration, capturing competitive advantages at every step.

Localiza’s bought 2.3% of the main automakers sales in 2011

452 locationsTop of Mind brandStrong know-howStable management

Sales to final consumer71 points of saleAdditional fleet during peaks of demand

57

IR Team

DisclaimerThe material presented is a presentation of general background information about LOCALIZA 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. This presentation is strictly confidential and may not be disclosed to any other person. 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 Securities Act of 1933 and Section 21E of the 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 LOCALIZA 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 LOCALIZA believes that the expectations and assumptions reflected in the forward-looking statements are reasonable based on information currently available to LOCALIZA’smanagement, LOCALIZA cannot guarantee future results or events. LOCALIZA expressly disclaims a duty to update any of the forward-looking statement.

Securities may not be offered or sold in the United States unless they are registered or exempt from registration under the Securities Act of 1933. Any offering of securities to be made in the United States will be made by means of an offering memorandum that may be obtained from the underwriters. Such offering memorandum will contain, or incorporate by reference, detailed information about LOCALIZA and its business and financial results, as well as its financial statements.

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 hereinshall form the basis of any contract or commitment whatsoever.

Nora LanariRoberto Mendes Silvio GuerraCFO - RI RI RI

Website: www.localiza.com/ir E-mail: [email protected] Phone: 55 31 3247-7024

58

Localiza x Peers

59

2011 Consolidated P&L

Financial statements

EBIT 595.7 47.0 78.7

per operating car Adjusted

Net revenues 2,918.1 670.9 390.7

167.9

(89.2)

(83.2)

(4.5)

EBITDA 167.1

(120.0)

(111.1)

(64.1)

Depreciation


EBT

821.3

(225.6)

416.7

Operating data

Average operating fleet 63,206 24,455 21,590

11,052

5,489


12,742Cars sold

59,950

50,412

60


EBIT 7.0 3.7 3.6

per operating car Adjusted

Net revenues 16.3 13.0 12.6

7.7

(4.1)

(3.9)

(0.2)

EBITDA 8.3

(4.6)

(3.9)

(0.2)

Depreciation


EBT

11.2

(4.2)

5.0

2011 Fleet Division P&L

Operating data

Average price of car sold 28.6 24.3 21.5

Average operating fleet 27,858 15,674 21,590

11,052

5,489

28.6

7.1


12,742

27.5

3.2

Cars sold

Average price of cars purchased 33.9

Purchase price – sales price

13,204

7,929

5.3

61



1 2 3 4 5 20 21 22 23 24

2011-year cycle


Revenue

Localiza - Fleet rental financial cycle

Spread7,6p.p.

Totalper year



NET INCOME 7,8 47,8% (3,4) -11,7% 4,4


Fleet Rental Seminovosper operating car per operating car

62



1 2 3 4 5 20 21 22 23 24

2011 - year cycle


Revenue

Unidas - Fleet rental financial cycle

Spread-3,4p.p.

Totalper year


EBITDA 8,3 63,8% (0,5) -2,1% 7,8 Depreciation (vehicle) (4,6) -18,9% (4,6) Depreciation (non-vehicle) (0,1) -0,8% (0,1) Interest on debt (3,9) -16,0% (3,9) Tax (2,5) -19,2% 2,7 11,1% 0,2

NET INCOME 5,7 43,9% (6,3) -25,9% (0,6)



63



1 2 3 4 5 20 21 22 23 24

2011- year cycle


Revenue

Locamerica Adjusted - Fleet rental financial cycle

Spread-1,7p.p.

Totalper year


EBITDA 7,7 61,1% 0,0 0,0% 7,7 Depreciation (vehicle) (4,1) -19,1% (4,1) Depreciation (non-vehicle) * - 0,0% - Interest on debt (3,9) -18,1% (3,9) Tax (2,3) -18,3% 2,4 11,2% 0,1

NET INCOME 5,4 42,8% (5,6) -26,0% (0,2)



64


EBIT 10.1 (0.2)

per operating carNet revenues 19.1 17.8

5.1

(5.3)

(5.4)

(5.6)

EBITDA

Depreciation


EBT

9.0

(2.0)

4.5

2011 Car Division P&L

Operating data

Average price of car sold 29,2 24.3

Consolidated

Average operating fleet 35,348 8,781

15,341

12,742

27.5

3.2

Cars purchased

Cars sold

Average price of cars purchased 28.4

Purchase price – sales price

46,746

42,483

(0.8)

65



1 2 3 4 5 20 21 22 23 24

2011 - year cycle


Revenue

Localiza – Car Rental financial cycle

Spread10,3p.p.

Totalper year

R$ % R$ % R$Net Revenues 19,1 100,0% 29,2 100,0% 48,3 Cost s (7,4) - 0,0% (7,4) SG&A (2,7) -14,1% (2,8) -9,6% (5,5) Net car sale revenue 26,4 90,4% 26,4 Book value of car sale (25,7) -90,0% (25,7)


NET INCOME 6,0 31,5% (2,6) -8,9% 3,4



66



1 2 3 4 5 20 21 22 23 24

2011 - year cycle


Revenue

Unidas – Car Rental financial cycle

Spread-12,7p.p.

Totalper year


EBITDA 5,1 28,7% (0,5) -2,1% 4,6 Depreciation (vehicle) (5,3) -21,8% (5,3) Depreciation (non-vehicle) (0,1) -0,6% (0,1) Interest on debt (5,4) -22,2% (5,4) Tax (1,5) -8,6% 3,4 13,8% 1,8

NET INCOME 3,5 19,5% (7,8) -32,3% (4,4)

NOPAT (0,6) ROIC -1,9%Cost of debt after tax (CDI+4,7%) 10,8%

Car Rental Seminovosper operating car per operating car

67

Localiza consolidated

46,00353,476

70,295

96,317

62,515

88,060

138,200 127,400 116,300

250,500291,600

190,200

2006 2007 2008 2009 2010 2011

Fleet

Net income

CAGR: 16.1%

Fleet and net income evolution

68

23,204

29,790

36,000

30,882

28,005

37,982

-17,377 -17,377

-40,484

-116,847

-64,121

-9,1722006 2007 2008 2009 2010 2011

Unidas consolidated

Fleet

Net income

Fleet and loss evolution

69

Fleet and loss evolution

Fleet

Net income

Locamerica - Adjusted

15,335

21,913

27,262

-8,462

-5,534

-2,643

2009 2010 2011

70

Fleet

2006 2007 2008 2009 2010 2011

Consolidated

Consolidated

71

Rating evolution – Localiza x Competitors

2008 2009 2010 2011 2012

AAA

AA+

AA

AA-

A+

A

A-

BBB+

BBB

BBB-

Rating

National scale

National scale

Source: Itaú/ Bloomberg, as of May, 2012

Localiza S&P

Competitors FITCH

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