Braskem Road ShowEurope, October 2003

José Carlos GrubisichPaul Altit

José Marcos Treiger

2

Disclaimer – Forward-Looking Statements

This presentation includes forward looking statements. Such information is not merely based on historical fact but also reflects management’s objectives and expectations. The words "anticipate", “wish", "expect", “foresee", “intend", "plan", "predict", “forecast", “aim" and similar words, written and/or spoken, are intended to identify affirmations which, necessarily, involve known and unknown risks.

Known risks include uncertainties which comprise, but are not limited to price and product competition, market acceptance of products, the actions of competitors, regulatory approval, currency type and fluctuations, regularity in the sourcing of raw materials and in operations, among others. This presentation is based on events up to October 09, 2003 and Braskem is not liable to update the contents in the light of new information and/or future events.

Braskem takes no responsibility for transactions or investment decisions made on the basis of information contained in this presentation.

3

Agenda

Braskem – Overview

1H03 Operating Performance

1H03 Results

Conclusion

4

Braskem: Strategic Drivers

Cost Competitiveness

(Low Cost Producer)

Technological Autonomy

(“Fast Follower”)

RegionalMarket

Leadership(Scale)

Strategic Positioning: “Braskem is a leading company in the Latin-American thermoplastic resins market, with up-stream competitive integration with its key raw materials (ethylene and proplylene)”.

5

Leadership in the thermoplastics segments in Latin America (1)

Polyethylene PVC Polypropylene

Braskem31%

Politeno12%

Dow27%

Outros12%

Ipiranga18%

Braskem39%Basell

(JV´s)44%

Cuyo6%

Ipiranga11%

Braskem51%

Solvay49%

(1) Source : Braskem 2002

6

Braskem : Production Scale

Main Players in the region:

Ethylene3,200 kt/year*PolyethylenesPolypropylenePVCPolystyrene

PET1,500

185

595 515340

810

Braskem DOW BASF IPIRANGA SOLVAY SUZANO PEREZ COMPANCIncluding Polibrasil

* Does not include 1.8 million tons of other chemical and petrochemical products produced by Braskem

Source: Braskem, 2002

7

Simplified structure accelerates synergy gains

Synergies*(R$ million)

Sep/02 Dec/02 Mar/03 Jun/03

208

Goal = 330

240

7553

* Annualized, recurring gains

8

Braskem Technology & Innovation Center

Main objective: To develop opportunities and solutions for

Braskem’s clients;

156 professionals involved in research activities;

R$ 300 million invested, comprising 6 pilot

plants and 11 laboratories;

Annual investments of R$ 30 million in R&D;

Partnership with universities and research centers;

In 2002, assistance provided to 188 clients for 550 new product

development requests.

Initiatives undertaken in recent years have allowed Braskem to file 100 different patents, 16 for products, 39 for processes, 26 for catalysis and 19 for equipment/automation.

9

Braskem – Petrochemical Value Chain

InputsBasicRaw

MaterialsIntermediates Final

Products

Ethylene

Propylene

Xylenes

Benzene

Butadiene

Polyethylene

Polypropylene

PVC

PET

Caprolactam

Caustic Soda

Naphtha

Gas Oil

Natural Gas

Condensate

10

Braskem: Positioned in Key Segments of the Economy

HDPE

PP LDPE

LLDPE

PVC

11

Braskem: a Very Attractive Market for its Core Business

1,313

1,811

2,1352,276

2,5292,653

2,829

3,102 3,014

0

500

1,000

1,500

2,000

2,500

3,000

3,500

90

Th

ou

san

ds

of

ton

s

Overall Market Consumption for

Thermoplastics (PE, PP and PVC)

8% CAGR* 3,2006%

1,5961,419

1,274

91 92 93 94 95 96 97 98 99 00 01 02

* Cumulative Average Growth Rate

Source: Abiquim, 2002

12

Braskem: Products with High Elasticity as Compared to the Local GDP

Annual Growth Rates – Brazil(1990 through 2002)%

15

2.1

GDPGDP

PVCPVC

6.1

Brazilian thermoplastics consumption growth

exceeds GDP growth by 3.7 times

6.5

PEsPEs

11.7

PPPP

7.7

TPTP(thermoplastics)

10

5

01990 - 2002

Source: Abiquim, 2002

13

Braskem: Ownership / Corporate Structure after 07/31/2003

29.5% 29.5% 35.0% 33.5%100.0% 56.3% 92.9% 51.6%

POLIALDEN

% Voting Stake % Total Stake

3.4% 7.8% 11.1% 2.9% 1.1% 10.2%29.5% 12.0% 3.4% 3.5%43.2% 43.3%

MARKET(1)PREVI PETROQUISA ODEBRECHT NORQUISA MARIANI PETROS

25.6%2.9%

(1) Includes Nissho Iwai’s 4.2% voting stake, corresponding to a 1.6% total stake.

14

Braskem – 1H03 Earnings Highlights

Net Revenues (R$ million) EBITDA (R$ million)

+54%+65% 8554,447

2,697 554

1H02 1H03 1H02 1H03Net Profit (R$ million)

468Net Debt (R$ million)

(R$ 1,109) (32%)

Mar 2003 Jun 2003Dec 2002

4.11

Mar 2003 Jun 2003Dec 2002

Net Debt/EBITDA (LTM*)

468R$ 948

1H03

1H02

6,815 5.106,365

5,706 3.49(480)

* Last twelve months; excluding extraordinay items in 4Q02.

15

Agenda

Braskem – Overview

1H03 Operating Performance

1H03 Results

Conclusion

16

Overview – Global Petrochemical Industry (1st Half 2003)

Raw materials prices remained at high levels;

Iraq War;

SARS epidemic in Asia:

. Temporary slowdown in the international polymers market, due to a 20% reduction in imports by China;

. Drop in inventory levels – higher order book backlog;

. An expectation for a recovery in imports by China in August-September 2003, which could place upward pressure on prices in Asia.

Source: Nexant – Chem Systems

17

Overview – Global Petrochemical Industry (1st Half 2003)

However, 2003 brought good news too...

The Iraq War ended without significant damage to oil fields;

Raw materials prices showed a downward trend;

The end of the SARS epidemic could signify a recovery in demand in Asia, particularly in China. Prices could rise in the region;

Expectation of gradual recovery among the world’s leading economies;

Limited capacity expansion among producers.

Source: Nexant – Chem Systems

18

International Price Trends

(Naphtha vs LDPE)Indexed - 100

60

70

80

90

100

110

120

LDPE

Naphtha

106

81

2/01/2003 1/04/2003 1/5/20031/03/2003 1/06/2003 1/07/2003 1/08/2003 19/09/2003

Source: Bloomberg

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Braskem – Operating Performance

Average Capacity Utilization (%)

ETHYLENE 7279

1H03 1H02Main Products

Total Thermoplastics 81 77

PE 75 69

PP 93 84

PVC 79 81

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Braskem – Sales Performance

ETHYLENE *

Total Thermoplastics

248,195 202,092 23 478,446

326,097 355,676 (9) 726,665

430,005

731,815 (1)

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2Q03 (A)

2Q02 (B)

Chg% (A)/(B)

1H03 1H02Main Products Chg% (C)/(D)(C) (D)

Sales Volume - Tons

PP

PE

94,900 98,120 206,616

142,593 140,175 306,626

193,376

303,887

(3)

2

7

1

PVC 79,864 100,361 190,543 203,963 (7)(20)

* Includes sales/transfers to Braskem subsidiaries

21

Braskem – Export Sales

US$ MM+38%

137181

2Q02 2Q03

+32%

North America31

Europe 28

Asia20

Latin America18

Africa3

317

1H02 1H03

Export Markets 1H03 (%)230

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Agenda

Braskem – Overview

1H03 Operating Performance

1H03 Results

Conclusion

23

1H03 Earnings

Accounting Criteria

• The following companies are part of Braskem and are fully consolidated in the financial statements: Braskem; Trikem and Polialden. (OPP Química and Nitrocarbono merged into Braskem on March 31, 2003)

• 1H02 earnings are presented on a pro-forma basis, and financial data from the companies that form Braskem is provided as if they had been part of the corporate structure since the january, 1st., 2002.

• Proportional consolidation effects are eliminated as per Rule CVM 247 for the stakes held in Politeno and Copesul, which are represented via the equity accounting method.

OPP and Nitrocarbono

CORPORATE LAW AS PER CVM RULE 247

Jan - May June - Dec

Copene, Polialden, Propett and Politeno

Copene, Polialden, Propett, Politeno, Copesul, Nitrocarbono,

OPP and Trikem

2002Jan - June

2003

Copene, Polialden, Politeno, Trikem

*

Copesul,

Assets Consolidated into Braskem

as per CVM 247

* Merged into Braskem on March 31, 2003

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Braskem – Income Statement

R$ million

Net Revenues 1,468 47 2,6974,4472,155 65

1H02* (D)

1H03 (C)

Chg %2Q02* (B)

2Q03 (A) (A/B)

Chg %(C/D)

Cost of Goods Sold (1,184) 46 (2,228)

Gross Profit 283 48 470

(3,558)

889

(1,734)

420

60

89

Gross Margin (%)

EBITDA 315 29 554855

19.3 20.0 17.419.5

405

1.0 15

54

Operating Profit 1 518 (46) 561636278 13

Profit (Loss) (316) - (480)468338 -

EBITDA Margin (%) 18.8 20.519.221.5 (12.5) (6)

Net Financial Result (1,024) - (1,241)171258 -

Earnings per share (R$) (93) - 131 (141)101 -

(1) Before Financial Items

* Pro forma financial statement

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Braskem – Cost of Goods Sold – (1H03)

COGS 1H03

R$ 3,558 millionOther variable

costs19.6%

Naphtha68.8%

Other1.6%Third-party

services1.3%

Depreciation3.7%

Personnel1.8%

Chem. Prods0.7%

Electricity2.6%

26

SG&A (1) and Fixed Costs

(as a % of Net Revenues)

FixedCosts

SG&A (1)

1H02 1H03

7.9

10.9

4.05.9

1H02 1H03

(1) Does not include depreciation/amortization

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Braskem – EBITDA 1H02 vs. 1H03 (R$ million)

554

855

Prices

Fixed &Var. Costs

(127)

Other OperatingRevs/Exps.

68

SalesVolume

Naphtha: (R$ 1.0 billion)

Gasoil: (R$ 95 MM)

Natural Gas: (R$ 34 MM)

(1,254)1,614

1H02 1H03

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Braskem – Steady EBITDA Growth

EBITDA marginPetrochemical Peers (%)

EBITDA(R$ million)

BraskemExtraordinary items

Industry Average (*)

21

315367

1,195

450

405

2T02 3T02 4T02 1T03 2T03

415

780*

1H02 1H03

12 11

19

(*) Average EBITDA margin of Dow, DuPont, Solvay, Lyondell, Eastman, Nova Chemicals andGeorgia Gulf based on public earnings data from 1H03.

Source: Thomson Financial and Braskem

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Braskem – Net Debt Reduction

Priority: Use of cash surpluses for debt reduction

Sound Cash Flow in the first half of 2003 (R$879 million)Efficient working capital management;Synergy gains from the integration process: R$ 240 million on an annual and recurring basis

Reduction FactorsNet Debt (R$ million)

( R$ 1,109)

Mar 03 Jun 03Dec 02

6,815

6,365

5,706

Net Debt / EBITDA ratio *:12/31/2002: 5.10

03/31/2003: 4.11

06/30/2003: 3.49

(*) LTM/ w/o extraordinary items

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Braskem – Consolidated Debt (Jun/03)

73

66

Sep/02 Jun/03

Gross Debt - % (US$)

Net Debt as of 6/30/03: R$ 5.7 Bi

Breakdown by Indexation

Amortization Schedule

Short-term portion includes:

• R$ 1,120 million in trade finance lines

• ~ R$ 559 million in working capital to finance the company’s operations

23.3

2004 2005 2006 2007

22.4

17.2

29.1

2003Jul03 –Dec03

(Gross Debt - %)

8.1

66%US$

Trade Finance ~31%

IGP-M6%

TJLP17% CDI

9%Other2%

Initiatives Underway:

• MTN (USD 500 MM);

• Trade Finance Programs

• International/ Domestic Structured Financing; Increased Working Capital Lines. •

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Braskem - Hedging Policy

ADOPT POLICIES AIMING AT THE REDUCTION OF THE IMPACTS OF THE EXCHANGE RATE VOLATILITY OVER FINANCIAL ASSETS/LIABILITIES, THUS PROTECTING US$

DENOMINATED CASH OBLIGATIONS FOR THE COMING 12 MONTHS

NON-TRADE FINANCE

FACILITIES.

0

20

40

60

80

100

75 %

0

20

40

60

80

100

TRADE FINANCE FACILITIES.

60%60 %

32

Braskem – US$ Exposure (Jun/03)

Hedging PolicyMinimum Standars

Hedge1. Hedge/InvestimentsUSD 404 MM

2. Exports Credits USD 152 MM

Balance as of 06/30/2003

Non-Trade FinanceFacilities

USD 362 MM75%

USD 272 MM

Trade Finance Facilites

USD 316 MM60%

USD 190 MM(1 + 2) = USD 556 MM

USD 462 MM

20 % Overhedge

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Agenda

Braskem – Overview

1H03 Operating Performance

1H03 Results

Conclusion

34

Petrochemical Industry: Positive outlook

Despite unexpected issues such as SARS, 2003 is expected to be atransition period to a new level of profitability;

Sector recovery should begin to accelerate in 2004; higher profitability;

Peak profitability (“fly-up”) is expected in 2005;

The outlook for 2006 and 2007 is positive given the limited amount of capacity coming on line;

A downturn is expected in 2008; however, it should be softer than past cycles (depending on investment levels);

The main future profitability driver will come from changes as a result of: Consolidation + Low energy prices + Lower investment levels

The next cycle in the petrochemical industry could be the best in 25 years!

Source: Nexant – Chem Systems

35

Braskem – Share Price Performance 2003

300

140

345

Ibovespa

BRKM5

BAK

60

140

220

300

380

jan-03 feb-03 mar-03 apr-03 may-03 jun-03 jul-03 aug-03 sept-03

100

LATIBEX listing approved by the Board of Directors (Oct. 03)

Last Update: 09/25/2003

36

Braskem : An Excellent Investment Opportunity

Leading thermoplastics producer in Latin America;

Integrated operations enable synergies to be captured;

Consolidated businesses and superior margins, with adjustment of capital

structure already under way;

OPP and Nitrocarbono merger completed and negotiations with common

shareholders of Trikem and Polialden;

Already a Bovespa Level 1 Company; will qualify for Level 2 within 2 years;

Offering 100% tag-along rights for all shareholders;

High potential for shareholder value creation;

Listed on LATIBEX on October 8, 2003.

A world-class Brazilian petrochemical company !