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Transcript of Embraer december 2014 book ri
This information is property of Embraer and can not be used or reproduced without written permission. DECEMBER 2014
+55 12 3927 4404 | [email protected] | www.embraer.com
This information is property of Embraer and can not be used or reproduced without written permission. 2
CORPORATE AND BUSINESS STRATEGY
• ORGANIC GROWTH • MARGINS ENHANCEMENT THROUGH THE P3E • BUSINESS AND REVENUES DIVERSIFICATION
• ORGANIC GROWTH AND ACQUISITIONS • ESTABLISH EMBRAER AS THE DEFENSE HOUSE OF BRAZIL
• PRODUCT STRATEGY • DIVERSIFICATION AND EXPANSION OF CUSTOMER BASE • EXCELLENCE IN CUSTOMER EXPERIENCE (ECE)
• MARKET SHARE GROWTH • MARGINS IMPROVEMENT • PRODUCT STRATEGY AND CUSTOMER SUPPORT FOCUS
This information is property of Embraer and can not be used or reproduced without written permission.
AIRCRAFT DELIVERIES
3
LARGE JETS - LEGACY & LINEAGE
LIGHT JETS - PHENOM 2014 DELIVERIES ESTIMATES • 92 - 97 E-JETS • 25 - 30 EXECUTIVE LARGE JETS • 80 - 90 EXECUTIVE LIGHT JETS
This information is property of Embraer and can not be used or reproduced without written permission.
5,3645,791 6,167 6,235
4,243
2010 2011 2012 2013 2014 YTD
NET REVENUES
US$ MILLION
2014 OUTLOOK: US$ 6.0 – 6.5 BILLION
4
This information is property of Embraer and can not be used or reproduced without written permission.
REVENUES BREAKDOWN
NET REVENUES BY SEGMENT NET REVENUES BY REGION
COMMERCIAL AVIATION
EXECUTIVE AVIATION OTHERS
DEFENSE & SECURITY
Revenues US$ Billion 5.79 6.17 6.24
Revenues US$ Billion 5.79 6.17 6.24
NORTH AMERICA BRAZIL
EUROPE
ASIA PACIFIC
SOUTH & CENTRAL
AMERICA AFRICA &
MIDDLE EAST
CHINA
5
This information is property of Embraer and can not be used or reproduced without written permission.
FIRM ORDER BACKLOG
6
US$ BILLION
17.8 18.2 19.2 18.1
22.1
3Q13 4Q13 1Q14 2Q14 3Q14
This information is property of Embraer and can not be used or reproduced without written permission.
This information is property of Embraer and can not be used or reproduced without written permission.
OVER 80 AIRLINES IN MORE THAN 50 COUNTRIES
EMBRAER COMMERCIAL AVIATION
8
This information is property of Embraer and can not be used or reproduced without written permission.
capacity: 70 to 80 seats range: 2,100nm (3,900Km)
capacity: 78 to 88 seats range: 2,000nm (3,700Km)
capacity: 98 to 114 seats range: 2,400nm (4,500Km)
capacity: 108 to 122 seats range: 2,200nm (4,100Km)
PRODUCT PORTFOLIO
capacity: 37 seats range: 1,750nm (3,250Km)
capacity: 44 seats range: 1,650nm (3,050Km)
capacity: 50 seats range: 1,550nm (2,900Km)
capacity: 50 seats range: 2,000nm (3,700Km)
9
This information is property of Embraer and can not be used or reproduced without written permission.
E-JETS CUSTOMER BASE EVOLUTION
1999-2000 2001-2002 2003-2004 2005-2006 2007-2008 2009-2010 2011-2014
2 4 14 27 50 55 68 Customers/ Operators
110 118
343
619
876
947
1,536
1,536 ACCUMULATED FIRM ORDERS
10
Source: Embraer (Mar/14 – Commercial Airlines and Leasing Co.)
This information is property of Embraer and can not be used or reproduced without written permission.
E-JETS Firm orders Deliveries Firm Backlog
E170 193 188 5
E175 408 227 181
E190 580 510 70
E195 145 135 10
E175-E2 100 - 100
E190-E2 60 - 60
E195-E2 50 - 50
Total 1,536 1,060 476
11
E-JETS FAMILY ORDER BOOK – 3Q14
This information is property of Embraer and can not be used or reproduced without written permission.
North America
Asia Pacific & China
15%
24%61%
E-JETS CUSTOMER BASE BY BUSINESS MODEL
FIRM ORDERS
COMMERCIAL JETS – NET ORDERS MARKET SHARE
Considering Accumulated Net Orders
70-130 SEATS JETS
BACKLOG
Latin America
Low Cost Carriers
Network Airlines
Regional Airlines
14%
5%
16%
13%
52%
14%2%
1%3%
80%
12
WORLDWIDE DISTRIBUTION
(% OF E-JETS FLEET+BACKLOG)
Europe & CIS
Middle East & Africa
This information is property of Embraer and can not be used or reproduced without written permission.
helping airlines to be more efficient
13
E-JETS DEPLOYMENT
48%
25%
7%
20%
North America
39%
11%
14%
36%
Europe/CIS
76%
16%
5%3%
Africa/Middle East40%
46%
5%9%
Asia Pacific
45% 28% 7% 20%WORLD
RIGHT-SIZING NEW MARKETS REPLACEMENT OF OLD JETS
NATURAL GROWTH
36%
40%
6%
18%
Latin America
12%
64%
24%
China
This information is property of Embraer and can not be used or reproduced without written permission.
• REPLACEMENT OF OLD/INEFFICIENT JETS
• RIGHT-SIZING OF NARROW-BODY OPERATIONS
• HUB FEEDER AND POINT-POINT OPERATION IN LOW AND MID-DENSITY MARKETS
• REGIONAL AVIATION DEVELOPMENT
AROUND 6,250 JET DELIVERIES (70-130 SEATS) IN THE NEXT 20 YEARS (US$ 300 BI)
14
PROJECTED DELIVERIES - JETS MARKET SEGMENT
(SEATS) 2014 – 2033
DELIVERIES
70 - 90 2,300
90 - 130 3,950
70 -130 6,250
EMBRAER MARKET FORECAST (2014 – 2033)
NORTH AMERICA
2,010 32%
LATIN AMERICA
700 11%
AFRICA
230 4%
EUROPE
1,140 18%
MIDDLE EAST
250 4%
CIS
380 6%
CHINA
1,020 17%
ASIA PACIFIC
520 8%
This information is property of Embraer and can not be used or reproduced without written permission. 15
COMPETITIVE SCENARIO 70-130 SEATS
130
120
110
100
90
80
70
SSJ95/100
MRJ90
ARJ21 CRJ900
CRJ1000
CRJ700
CAPACITY (SINGLE CLASS)
737-7 MAX A319 NEO
CS100
CS300
E-195
E-190
E-175
E-170
This information is property of Embraer and can not be used or reproduced without written permission.
This information is property of Embraer and can not be used or reproduced without written permission.
RIGHT CAPACITIES TO MATCH MARKET DEMAND
70
80
90
100
110
120
130
+4 SEATS
SAME
+14 SEATS
20%
20% E190-E2
E195-E2
E175-E2
17
capacity: 120-136 seats range: 2,000nm
capacity: 97-114 seats range: 2,800nm
capacity: 80-90 seats range: 1,920nm
This information is property of Embraer and can not be used or reproduced without written permission.
E175-E2
NEW WING More efficient, high aspect ratio
metallic wing. Raked wing tip.
IMPROVED AVIONICS 4 larger 13”x10” displays and touchscreen controls
MAIN LANDING GEAR Enabling larger engines. Gear doors
for improved fuel efficiency
OPTIMIZED WING/ENGINE DIFFERENT WING AND ENGINE COMBINATIONS FOR E175-E2 AND E190/195-E2
NEW ENGINES Larger fan diameter and improved fuel efficiency
18
E2 NEW FEATURES – NOT JUST A RE-ENGINE
E190-E2 & E195-E2
This information is property of Embraer and can not be used or reproduced without written permission.
• HIGHEST COMMONALITY AMONG
E-JETS E2 MODELS (AAA)
• FULL FLIGHT SIMULATOR OR HIGH - LEVEL
FLIGHT TRAINING DEVICE NOT REQUIRED
• FEWER THAN 3 DAYS TRANSITION
TRAINING BETWEEN THE TWO E-JET
GENERATIONS
19
E-JETS & E-JETS E2 PILOT COMMONALITY
• SAME TYPE RATING COMMONALITY
BETWEEN E-JETS E2 AND CURRENT E-JETS
FAMILY (CCC)
This information is property of Embraer and can not be used or reproduced without written permission. 20
E-JETS E2 SUPPLIERS
PACIS
Fuel System Water & Waste
Pax Oxygen
Crew Oxygen
External Lights
Hydraulic Pumps
Cabin Management Sys Cabin Lights
Emergency Battery Passenger Service Unit
Control Wheel Column-by-Wire Control Pedals
Avionics
Powerplant / APU
Flight Controls
E-bay Cooling Sensors Fans package
Recirculation Filter
AMS
LG Controls
Pilots Seats Observer Seat
FA seats
Cockpit Printer
Cockpit Lighting
Vertical and Horizontal Tail
Doors (Pax, Service & OWE)
Spoilers / Ailerons
Center III, Rear Fuselage Rudder, Elevator, Insulation
Wheels & Brakes APU Electrical System
(Generation, Distribution, Emergency, Batteries e Converters)
This information is property of Embraer and can not be used or reproduced without written permission.
FUEL BURN PER SEAT
E175-E2 (80 seats) vs. E175 (76 seats)
E190-E2 (97 seats) vs. E190 (97 seats)
E195-E2 (120 seats) vs. E195 (106 seats)
-16%
-24%
-16%
0%
-5%
-10%
-15%
-20%
-25%
Target values for 600 nm sector; Dual Class configuration;
21
FUEL BURN IMPROVEMENTS
This information is property of Embraer and can not be used or reproduced without written permission.
180+
160
140
120
100
80
SSJ95/100
MRJ90 ARJ21 CRJ900
CRJ1000
CRJ700
CAPACITY (SINGLE CLASS)
737-7 MAX A319neo
A320neo
737-8MAX
CS100
CS300
E175-E2
E190-E2
E195-E2
22
NEW COMPETITIVE SCENARIO
This information is property of Embraer and can not be used or reproduced without written permission.
• EMBRAER INVESTMENT ON RESEARCH, DEVELOPMENT AND
CAPEX FOR THE E-JETS E2 FAMILY WILL BE US$ 1.7 BILLION
• INVESTMENT WILL BE SUPPORTED BY EMBRAER’S CASH
GENERATION AND DEBT
• INVESTMENTS SPAN FROM 2013 - 2020 WITH MORE
CONCENTRATION IN 2014 - 2017
23
PROGRAM INVESTMENT
This information is property of Embraer and can not be used or reproduced without written permission.
Preliminary Information as of January, 2013 -- US$ 3.3/USGal, 10 years NPV @ 9% rate
BETTER FUEL CONSUMPTION GAIN • E175 E2: US$ 4.8M • E190 E2: US$ 7.0M • E195 E2: US$ 6.5M
MAINTENANCE COST REDUCTION GAIN • US$ 1.0~1.5M
E175
AR (8E5): 42.9
E190 AR (10E5):47.4
E195 AR (10E5): 50.1
E-Jets
E175-E2 46.8
E190-E2 53.6
E195-E2 60.4
delta: 3.9 M
delta: 6.2 M
delta: 10.3 M
E-Jets E2
SEAT CAPACITY INCREASE GAIN • E175 E2: US$ 1.6M (4 SEATS) • E195 E2: US$ 4.8M (14 SEATS)
24
LIST PRICES (US$ MILLION)
This information is property of Embraer and can not be used or reproduced without written permission. 25
PROGRAM UPDATE
E190-E2 Joint Definition Phase completed Q2/14 • WIND TUNNEL TEST CAMPAIGN CONCLUDED
• DIGITAL MOCK-UP ACHIEVED EXPECTED MATURITYPRODUCT STRUCTURE AND INTERFACES READY FOR
• NEXT PHASE (MORE THAN 90% COMPLETION).ADVANCED PRODUCT STRUCTURE AND INTERFACES DEFINITION
E195-E2 Joint Definition Phase started Q2/14 • HIGH COMMONALITY WITH E190-E2
• NEW CENTER FUSELAGE WITH 2 OWE
• STRETCHED AFT PLUG
E175-E2 Development • CONCEPTUAL STUDIES PHASE CONCLUDED
• PRELIMINARY STUDIES PHASE ON GOING • WING OPTIMIZATION • PRODUCT TRADE OFFS
This information is property of Embraer and can not be used or reproduced without written permission.
E195-E2 | EIS 2019
E190-E2 | EIS 1H2018
E175-E2 | EIS 2020
210 Firm Orders 380 Commitments
26
E2 ENTRY INTO SERVICE
590 E-JETS E2
This information is property of Embraer and can not be used or reproduced without written permission.
This information is property of Embraer and can not be used or reproduced without written permission.
NEARLY 800 JETS IN SERVICE IN MORE THAN 50 COUNTRIES
28
EMBRAER EXECUTIVE JETS
This information is property of Embraer and can not be used or reproduced without written permission. 29
PRODUCT PORTFOLIO
LARGE
AIRCRAFT MODEL SEATS /RANGE
up to 8 occupants/ 1,178 nm
up to 11 occupants/ 1,971 nm
7 to 9 passengers/ 2,300 nm
8 to 12 passengers/ 3,000 nm
13 to 14 passengers/ 3,400 nm
13 to 19 passengers/ 4,500 nm
ENTRY
LIGHT
MID-LIGHT
MID-SIZE
ULTRA-LARGE
SUPER MID-SIZE
Certified: 2008
Certified: 2009
UNDER DEVELOPMENT
Certified: 2001
Certified: 2008
ULTRA-LONG RANGE
COMPETITORS
• Cessna - Mustang/M2 • HondaJet
• Cessna - CJ2+/CJ3/CJ4 • Bombardier - Learjet 40XR/70
• Bombardier - Learjet 45XR/75 • Cessna - XLS+/Latitude
• Bombardier - Learjet 85 • Cessna - Sovereign • Gulfstream - G150
• Bombardier - CL605/GL5000 • Dassault - Falcon 2000LXS/
900LX • Gulfstream - G350/G450
• Airbus - ACJ 318/319/320 • Boeing - BBJ/BBJ2/BBJ3
13 to 14 passengers/ 3,900 nm
Certified: 2010
• Bombardier - GL6000/GL7000/ GL8000
• Gulfstream - G500/G550/G650/ 650ER
• Dassault - Falcon 7X/8X
• Bombardier - CL300/CL850 • Cessna - X/Longitude • Dassault - Falcon 2000S • Gulfstream - G280
Certified: 2014
This information is property of Embraer and can not be used or reproduced without written permission.
DELIVERIES SHARE (UNITS) REVENUES SHARE (US$ BI | B&CA LIST PRICES)
MARKET DELIVERIES 2013: 677 UNITS
EMBRAER DELIVERIES: 119 UNITS
BOMBARDIER
MARKET REVENUES 2013: US$ 21.2 BILLION
EMBRAER REVENUES: US$ 1.6 BILLION
30
MARKET SHARE
HAWKER-BEECH DASSAULT
CESSNA GULFSTREAM OTHERS
This information is property of Embraer and can not be used or reproduced without written permission.
NEW RECORD LEVELS
31
ECONOMIC INDICATORS
U.S. CORPORATE PROFITS WORLDWIDE HNWI POPULATION
This information is property of Embraer and can not be used or reproduced without written permission. 32
BUSINESS JETS PRE-OWNED MARKET INVENTORY
Source: Jetnet and Embraer analysis, October 2014
0%
4%
8%
12%
16%
20%
24%
28%
0
500
1000
1500
2000
2500
3000
3500
Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3Q4Q1Q2Q3
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 14
% o
f ac
tive
fle
et
Un
its
Fleet older than 10 yrs Fleet from 6 to 10 yrs
Fleet up to 5 yrs Positions
Fleet up to 5 yrs and positions Total fleet % for sale
Up to 10 yrs % for sale
11.1% 2202 jets
7.3% 620 jets
This information is property of Embraer and can not be used or reproduced without written permission.
US CORPORATE PROFITS AT RECORD LEVELS
HNWI AT RECORD LEVELS
WORLD GDP GROWTH IS MODERATE
USED MARKET INVENTORY LEVELED OFF; PRICES STILL A CONCERN
TRAFFIC RECOVERY ON TRACK BUT SLOWER THAN EXPECTED
EUROPEAN MARKETS AT RISK; SOFTENING EMERGING MARKETS DEMAND
SLOW RECOVERY
• LACK OF CONFIDENCE IS SLOWING THE BIZJET MARKET TURNAROUND
• USA MARKET WILL DICTATE THE SPEED OF RECOVERY
33
MARKET RECOVERY IN SLOW MOTION
This information is property of Embraer and can not be used or reproduced without written permission.
0
200
400
600
800
1000
1200
20
08
20
09
20
10
20
11
20
12
20
13
20
14
20
15
20
16
20
17
20
18
20
19
20
20
20
21
20
22
20
23
9,250 JETS AND US$ 250 BI IN THE NEXT 10 YEARS
UNITS US$
900 4.2
1,780
15.8
1,140
17.3
920
17.8
1,270
31.1
1,670
64.7
1,345
82.2
225 17.3
Deliveries Revenues
N10YF
Deliveries Forecast (units)
Ultra Large
Ultra Long Range
Large
Supermid
Midsize
Midlight
Light
Entry
34
2014-2023 MARKET FORECAST
This information is property of Embraer and can not be used or reproduced without written permission.
NORTH AMERICA 4,620 a/c (50%) US$ 120 Bi (45%)
EUROPE, MIDDLE EAST & AFRICA 2,360 a/c (26%) US$ 77 Bi (29%)
ASIA PACIFIC 570 a/c (6%) US$ 19 Bi (7%)
LATIN AMERICA 850 a/c (9%) US$ 16 Bi (6%)
CHINA 835 a/c (9%) US$ 33 Bi (12%)
WORLDWIDE 9,250 units US$ 265 Bi
35
2015-2024 MARKET FORECAST BY REGION
Note: sum of regional numbers might differ from total numbers due to rounding Source: Embraer Analysis
This information is property of Embraer and can not be used or reproduced without written permission.
NEARLY 70 SERVICE CENTERS WORLDWIDE.
EMBRAER SERVICE CENTER
AUTHORIZED SERVICE CENTER
NEW EMBRAER SERVICE CENTER IN SÃO PAULO - BRAZIL
36
SERVICE CENTER NETWORK
This information is property of Embraer and can not be used or reproduced without written permission.
This information is property of Embraer and can not be used or reproduced without written permission.
OVER 50 ARMED FORCES
38
EMBRAER DEFENSE & SECURITY
This information is property of Embraer and can not be used or reproduced without written permission.
INTEGRATED PORTFOLIO
LIGHT ATTACK AND ADVANCED TRAINING
TACTICAL MILITARY TRANSPORT
ISR (INTELLIGENCE, SURVEILLANCE AND RECONNAISSANCE)
UAVs RADAR C4I LAND SYSTEMS SERVICES
39
SATELLITE
TRANSPORT AIRCRAFT MODERNIZATION PROGRAMS
This information is property of Embraer and can not be used or reproduced without written permission.
COMMAND AND CONTROL SYSTEMS
AIR TRAFFIC
MANAGEMENT CONTROL
SYSTEMS OF
SYSTEMS
C4I
UAVS
SIMULATORS
MODERNIZATION OF AVIONICS
SYSTEMS
LAND DEFENSE SYSTEMS
INTEGRATION
SISFRON
IMPLEMENTATION
MRO
AERO
STRUCTURES
REMOTE SENSING
AERIAL
SURVEILLANCE RADAR
SATELLITE GEOSTATIONARY OF
DEFENSE AND COMMUNICATIONS
(SGDC)
100% 51% 65% 90% 100% 51%
40
PARTNERSHIPS
UAVs RADAR C4I LAND SYSTEMS SERVICES SATELLITE
This information is property of Embraer and can not be used or reproduced without written permission.
REVENUES EVOLUTION (US$ MILLION) BACKLOG EVOLUTION (US$ BILLION)
41
EMBRAER DEFENSE & SECURITY RESULTS
REVENUES PARTICIPATION (%)
This information is property of Embraer and can not be used or reproduced without written permission.
BRAZIL: 99
COLOMBIA: 25
DOMINICAN REPUBLIC: 8
CHILE: 12
ECUADOR: 18
INDONESIA: 16
GREYSTONE (TACAIR): 1
MAURITANIA: 2
BURKINA FASO: 3
ANGOLA: 6
USA: 20
TOTAL MARKET FORECAST: 300 AIRCRAFT / US$ 3.5 BILLION
800
2,000700
MEDIUM-TERM
LONG-TERM
SHORT-TERM
ADDRESSABLE MARKET FORECAST 2020 (US$ MILLION)
PARTNERSHIP WITH BOEING TO PROVIDE WEAPONS INTEGRATION, INCREASING CAPABILITIES OF THE AIRCRAFT.
• FIRM ORDERS: MORE THAN 210 AIRCRAFT • OVER 180 AIRCRAFT DELIVERED
42
SUPER TUCANO
This information is property of Embraer and can not be used or reproduced without written permission.
• A new tactical military transport and tanker aircraft
• First flight in 2014
• Six countries letters of intent, totalizing 60 aircraft
• Partnership with Boeing to share technical knowledge and to market and sell the KC-390 in certain markets
• FAB and Embraer signed the series production contract of the KC-390
• Embraer rolled out the first prototype of the KC-390
TOTAL MARKET FORECAST 2025: 700 AIRCRAFT / US$ 50+ BI
43
EMBRAER KC-390
BRAZIL (28)
COLOMBIA (12)
ARGENTINA (6)
CHILE (6)
PORTUGAL (6)
CZECH REP. (2)
This information is property of Embraer and can not be used or reproduced without written permission.
BRAZILIAN NAVY A-4 12 aircraft
5 prototypes at GPX-CS
BRAZILIAN AIR FORCE A-1M 43 aircraft
26 received by Embraer for the modernization
3 delivered
BRAZILIAN AIR FORCE F-5M 46 aircraft + 11 aircraft (2nd batch)
46 delivered
BRAZILIAN AIR FORCE E-99 5 aircraft EMB 145 AEW&C
A-4
ADDRESSABLE MARKET FORECAST 2025 (US$ MILLION)
TOTAL MARKET FORECAST: 228 AIRCRAFT / US$ 1.5 BILLION
437
567
505MEDIUM-TERM LONG-TERM
SHORT-TERM
44
MODERNIZATION PROGRAMS
This information is property of Embraer and can not be used or reproduced without written permission.
SISFRON Integrated Borders Monitoring System
First phase: US$ 420 Million
Total estimate: US$ 4 Billion
Comprising radars, communication networks, C4I, unmanned air vehicles (UAV) and armored vehicles
SATELLITE Estimate: US$ 400 Million
Participation in the first Brazilian Geostationary Satellite
Ref. dec/12
SENS59%
COMM
9%
UAV12% SW
20%
45
BRAZILIAN ARMY PRIORITIES
This information is property of Embraer and can not be used or reproduced without written permission.
2014 OUTLOOK
This information is property of Embraer and can not be used or reproduced without written permission.
EBITDA MARGIN 13.0% – 14.0%
NET REVENUES
EBITDA
US$ 6.0 – 6.5 BILLION
US$ 780 – 910 MILLION
EBIT MARGIN 9.0% – 9.5%
EBIT US$ 540 – 620 MILLION
FREE CASH FLOW POSITIVE LOW DOUBLE DIGITS
47
2014 CONSOLIDATED OUTLOOK
This information is property of Embraer and can not be used or reproduced without written permission.
2014 BUSINESS UNITS OUTLOOK
48
20% OF NET REVENUES
1% OF NET REVENUES
26% OF NET REVENUES
53% OF NET REVENUES
DELIVERIES: 92 TO 97 E-JETS
US$ 100 MILLION
US$ 1.50 – 1.70 BILLION
US$ 1.20 – 1.30 BILLION
OTHER REVENUES
US$ 3.20 – 3.40 BILLION
DELIVERIES: 80 TO 90 LIGHT JETS 25 TO 30 LARGE JETS
This information is property of Embraer and can not be used or reproduced without written permission.
TOTAL INVESTMENTS: US$ 650 MILLION
RESEARCH US$ 80 MILLION
DEVELOPMENT US$ 320 MILLION
CAPEX US$ 250 MILLION
49
2014 INVESTMENT OUTLOOK
This information is property of Embraer and can not be used or reproduced without written permission.
FINANCIAL RESULTS
This information is property of Embraer and can not be used or reproduced without written permission.
NET REVENUES - US$ MILLION SG&A EXPENSES - US$ MILLION
51
NET REVENUES | SG&A EXPENSES
2014 OUTLOOK: US$ 6.0 – 6.5 BILLION
YTD: 459
SELLING EXPENSES G&A EXPENSES
1,288
2,304
1,242
1,761
1,240
3Q13 4Q13 1Q14 2Q14 3Q14
YTD: 4,243
112 11392
11599
51 52
48
5352
3Q13 4Q13 1Q14 2Q14 3Q14
165
140
163 151
168
This information is property of Embraer and can not be used or reproduced without written permission. 52
INCOME FROM OPERATIONS (EBIT) | EBITDA
EBIT - US$ MILLION EBITDA - US$ MILLION
2014 OUTLOOK: EBIT: US$ 540 – 620 MILLION
EBIT MARGIN: 9.0% – 9.5%
2014 OUTLOOK: EBITDA: US$ 780 – 910 MILLION
EBITDA MARGIN: 13.0% – 14.0%
YTD: 347 | 8.2%
EBIT EBIT MARGIN EBITDA EBITDA MARGIN
YTD: 548 | 12.9%
76
463
92 187
68
5.9%
20.1%
7.4%10.6%
5.5%
3Q13 4Q13 1Q14 2Q14 3Q14
156
544
151261
136
12.1%
23.6%
12.2%14.8%
11.0%
3Q13 4Q13 1Q14 2Q14 3Q14
This information is property of Embraer and can not be used or reproduced without written permission.
102
761
(273)
13 49
(106) (156)
(48)
(60) (89)
(80)(109)
(83)
(103) (97)(84)
496
(404)
(150) (138)
3Q13 4Q13 1Q14 2Q14 3Q14
NET INCOME - US$ MILLION FREE CASH FLOW - US$ MILLION
FREE CASH FLOW
ADDITIONS TO PP&E NET CASH GENERATED (USED) BY OPERATING ACTIVITIES*
ADDITIONS TO INTANGIBLE
* Net of Financial assets adjustment
53
NET INCOME | FREE CASH FLOW
YTD: 243 | 5.7%
NET MARGIN NET INCOME
YTD: (691)
53
265
111 143
(11)
4.1%
11.5%8.9%
8.1%
-0.9%
3Q13 4Q13 1Q14 2Q14 3Q14
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INDEBTEDNESS MATURITY NET CASH (DEBT) - US$ MILLION
54
INDEBTEDNESS PROFILE | NET CASH
LONG-TERM SHORT-TERM LOANS AVERAGE MATURITY (YEARS)
TOTAL DEBT 3Q14: US$ 2.37 BILLION TOTAL CASH 3Q14: US$ 2.05 BILLION
96% 96% 96% 96% 96%
4% 4% 4% 4% 4%
6.3 6.25.9 5.7 5.6
3Q13 4Q13 1Q14 2Q14 3Q14
(20)
429
53
(114)
(327)
3Q13 4Q13 1Q14 2Q14 3Q14
This information is property of Embraer and can not be used or reproduced without written permission. 55
INVENTORIES
US$ MILLION
2,780
2,2872,542 2,439
2,767
3Q13 4Q13 1Q14 2Q14 3Q14
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INVESTMENTS
2014 OUTLOOK: US$ 650 MILLION
2014 OUTLOOK 2014 YTD
US$ MILLION
30
112 10180
320
250
RESEARCH DEVELOPMENT CAPEX
YTD: 243
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EPADS AND PAY OUT
EPADS PAY OUT
US$
This information is property of Embraer and can not be used or reproduced without written permission.
NYSE52%
BM&F
BOVESPA
48%
22%
78%
InternationalShareholders
LocalShareholders
734,899,822 VOTING SHARES
58
OWNERSHIP STRUCTURE – 3Q14
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CORPORATE INFORMATION
This information is property of Embraer and can not be used or reproduced without written permission.
BRAZILIAN ALLIANCE FOR BIO-FUEL ISO 14001 AND OHSAS 18001 CERTIFICATIONS
1ST ETHANOL POWERED AIRCRAFT IN THE WORLD
GREENER TECHNOLOGY
SOCIAL ACTIVITIES
60
SUSTAINABILITY INITIATIVES
REFORESTATION PROJECTS
RECYCLING
CORPORATE VALUES
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E-JETS FINAL ASSEMBLY LINE TRANSFORMATION
E-JETS WING JUNCTION LINE TRANSFORMATION
Performance Indicators2008
(15 ac/month)
2009
(10 ac/month)
2012
(10 ac/month)
Number of positions 12 5 4
Cycle time (days) 18 10 8
Work in Process
(US$ Mi)212 95 68
Number of non-
conformity per a/c32 1.7 0.76
Overtime
(% of work hours)10 1.5 0
61
P3E – LEAN RESULTS
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KAIZEN - E-JETS CYCLE REDUCTION COST OF NON QUALITY REDUCTION
57%
40% REDUCTION ON THE PRODUCTION CYCLE
40%
44% REDUCTION ON CNQ
62
P3E – LEAN RESULTS
This information is property of Embraer and can not be used or reproduced without written permission.
COST: US$ 26.8 MILLION
BENEFIT: US$ 250.0 MILLION
63
“BOA IDEIA” PROGRAM EVOLUTION
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INVESTOR RELATIONS
PHONE: +55 12 3927 4404 [email protected]
WWW.EMBRAER.COM
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This presentation may contain forward-looking statements, projections and estimates regarding circumstances
or events yet to take place, including, but not limited to, those statements relating to guidance. These forward-
looking statements are based largely on current expectations, forecasts of future events and industry and
financial trends that affect Embraer’s businesses. These statements are subject to risks, uncertainties and
assumptions that include, among others: general economic, political and trade conditions, both in Brazil and in
those markets where Embraer does business; management’s expectations and estimates concerning the
company’s future financial performance; plans and objectives of our management; financing plans and
programs, and the effects of competition; industry trends and growth opportunities; inflation and fluctuations
in exchange rates; the company’s investment plans; Embraer’s operating efficiencies and synergies and its
capacity to develop and deliver products on the dates previously agreed upon; results of operation; business
strategies; benefits of new technologies and existing and future governmental regulations. To obtain further
information on factors that may lead to results different from those forecast by Embraer, please consult the
reports Embraer files with the U.S. Securities and Exchange Commission (SEC) and the Brazilian Comissão de
Valores Mobiliários (CVM) and in particular the factors discussed under “Forward-Looking Statements” and
“Risk Factors” in Embraer’s annual report on Form 20−F. The words “believe”, “may”, “will”, “estimate”,
“intend”, “continue”, “anticipate”, “expect” and other similar terms are intended to identify forward-looking
statements. Embraer does not undertake any obligation to publish updates or to revise any forward-looking
statements due to new information, future events or any other factors. In view of the inherent risks and
uncertainties, such estimates, events and circumstances may not occur. The actual results and performance of
Embraer could therefore differ substantially from those anticipated in Embraer's forward-looking statements.
65
FORWARD LOOKING STATEMENT