Usim Webcast 3q06 Vers

7/31/2019 Usim Webcast 3q06 Vers

1/18

Webcast

Third Quart er 2006 Result s

Presentation:

Paulo Penido Pint o Marques

CFO and Investor Relat ions Dir ector


2/18

Disclaimer

2

Declarat ions relat ive t o business perspect ives of t he Company,

operat ing and f inancial result s and project ions, and references t o

t he growth of t he Company, const it ute mere forecast s and were

based on Management s expectat ions in relat ion t o futureperformance. These expectat ions are highly dependent on market

behavior, Brazil s economic sit uat ion, t he indust ry and

international market s, and are therefore subject t o change.


3/18

3

CONSOLIDATED RESULTS IN 3Q06 AND 9M06

R$ mill ion 3Q 2006 3Q 2005 2Q 2006Chg.

3Q06/3Q059M 2006 9M 2005

Chg.

9M06/9M05

Total Sales Volume (000 t ) 1,971 1,769 2,028 11% 5,953 5,367 11%

Net Revenues 3,127 3,126 3,053 0% 9,138 10,072 -9%

Gross Profit 1,195 1,221 1,013 -2 3,096 4,503 -31

Operat ing Result (EBIT) a 1,022 1,098 890 -7% 2,653 4,017 -34%

Financial Result (91) (171) (78) -47% (287) (505) -43%

Net Income 715 782 704 -9% 1,763 2,594 -32%

EBITDA b 1,228 1,265 1,046 -3% 3,182 4,615 -31%

EBITDA Margin 39.3 40.5% 34.3 -1.2 p.p. 34.8 45.8% -11.0 p.p.

EBITDA (R$/t ) 623 715 516 -13% 535 860 -38%

Total Assets 18,124 17,367 18,066 4% 18,124 17,367 4%

Net Debt 1,669 2,243 1,603 -26% 1,669 2,243 -26%

Stockholders' Equity 10,166 7,994 9,451 27% 10,166 7,994 27%

(a) Earnings before i nter est , t ax and parti cipat ions.

(b) Earnings before int erest , t axes, depreciation, amort izati on and part icipati ons.

Highlights


4/18

4

Sales Volume: In 3Q06, slight decrease compared to 2Q06, although 11%above y-o-y in 9M06

Net Revenue: 2%above 2Q06 due to improved avg. prices, totalingR$ 9.1 billion in the year.Net Revenues per tonne: 8%increase in total sales (Dom. & Exp. market)

EBITDA: Up 17%from 2Q06, accumulating R$ 3.2 billion in the year

EBITDA Margin: Rose to 39%from 34%in 2Q06

Net Profit : 2%higher than 2Q06, totaling R$ 1.8 billion in t he year

Maintenance of Domestic Market leadership: 52%Market Share

HIGHLIGHTS Consistent result s within it s annual planning


5/18

Shareholders St ructure - New Control Group

5

Previ14.9%

CVRD

12.3%

Others

8.9%Votorantim11.6%

Usiminas PensionFund

10.1%

Nippon Group

24.7%

CVRD5.9%

Camargo Corra11.6%C

ontrolGroup

:63.9

%


6/18

Reached its peak during 3Q06 in terms of demand and prices

China continues the exception: st rong demand compat ible wi th its growth.However, with lower price levels.Accounts for 34%of total global crude steel production.

Global crude steel production in 9M06: 903.4 million tonnes, 9%above9M05.

USA: Vigorous growth and measures to contain inflation.Signs of unbalance between supply and demand.

Europe: More stable environment.

6

STEEL INDUSTRY SCENARIO

Internat ional MarketInternat ional Market:


7/18

STEEL INDUSTRY SCENARIO

Domest ic Market :Domest ic Market :

Crude steel production: totaled 22.8 million tonnes in 9M06 -decrease of 4%compared to 9M05.

Domestic flat steel demand:

3Q06/3Q05 Change: 18%growth.Highlight for civil const ruct ion/ shapes, dist ribut ion, autopart s,highway equipment and electronics segments.

9M06/9M05 Change: 3%growth.Highlight for segments that were benefited by increase inconsumption; Automotive, Electrical/ Electronic Equipment andDomestic Appliances.

7


8/18

Total sales in 3Q06: 1.97 MMt,

3Q06/3Q05 = 11% higher and3Q06/2Q06 = 3% decrease

Domest ic sales growt h of 11% over3Q05 and 4% decr ease over 2Q06.

Expor t sales - 13% growt h over 3Q05and 1% decr ease over 2Q06.

Accumulated sales 9M06: 5.95 MMt,11% above 9M05.

8

USIMINAS - CONSOLIDATED SALES

75% 74% 65% 64% 73%72% 71% 71% 78% 70% 69%

75% 74% 65%

Consoli dated Sales (000 t )

1Q03 2Q03 3Q03 4Q03 1Q04 2Q04 3Q04 4Q04 1Q05 2Q05 3Q05 4Q05 1Q06 2Q06 3Q06

Domest ic Market Export Market

72%

75% 74% 65% 64% 73%72% 71% 71% 78% 70% 69% 54% 62% 69% 68%

25% 26% 35% 36% 28% 27% 29% 29% 22%30% 31% 46% 38% 31% 32%

1,8301,939

1,822

2,119

1,910 1,9712,011

2,170

1,7681,829

1,770

1,981 1,9542,028

1,971


9/18

9

SALES MIX BY PRODUCT

Slabs

13%

Hot Rolled

28%

ProcessedProducts

4%

Heavy Plates

23%

Cold Rolled

24%

Hot Dip

Galvanized

5%

Electro

galvanized

3%

Slabs

12%

Hot Rolled

25%

Hot DipGalvanized

5%

Processed

Products4%

Heavy Plates

21%

Cold Rolled

30%

Electrogalvanized

3%

3QO6 3QO5


10/18

10

EXPORTS BY COUNTRY - 9M06

Spain

5%

Argentina

5%

United States21%

Thailand

6%

Colombia

3%

South Korea

3%

Canada

8%

Mexico

14%

Chile

5%

Germany

11%India

6%

Others

13%


11/18

11

CONSOLIDATED EBITDA

EBITDA - totaled R$ 1.2 bi ll ion( US$ 565 mil li on) in 3Q06,accumulating R$ 3.2 billion in9M06 (US$ 1.5 billion).

EBITDA margin of 39% in 3Q06and 35% in 9M06.

EBI TDA & EBI TDA Margin

479

565

414

404

539

655

646

652

538

422

318

263

225

255

258

34%

39%

31%31%

41%

47%

50%48%49%

36%

46%

39%

31%33%

42%

1Q03

2Q03

3Q03

4Q03

1Q04

2Q04

3Q04

4Q04

1Q05

2Q05

3Q05

4Q05

1Q06

2Q06

3Q06

EBITDA (US$ mil lion) EBITDA Margin


12/18

12

CONSOLIDATED NET DEBT

CND/EBITDA ratio at 0.4 x

New BNDES credit line forinvestment f inancing up toR$ 900 mil li on

Debt profile:

Short Term - 26%Long Term - 74%

Debt by curr ency:

Domestic - 24%Foreign - 76%

Consolidated Net Debt /

EBI TDA

0,

7

0,

8

0,

9

2,

4

2,

6

2,

5

2,

3

2,

2

1,

9

1,

7

1,

3

1,

0

1,

0

1,

0

0,

7

0,4 0,40, 4

2, 72, 5

2, 32, 1

1, 6

2, 6

1, 1

0, 70, 4 0,4 0,4 0, 3

1Q03 2Q03 3Q03 4Q03 1Q04 2Q04 3Q04 4Q04 1Q05 2Q05 3Q05 4Q05 1Q06 2Q06 3Q06

CND (US$ billion) CND/ EBITDA


13/18

13 Usiminas cash posit ion amounted R$2.0 bil li on on Sept . 29 2006

3Q06 CONSOLIDATED CASH FLOWBrazilian GAAP (Legislao Societria) - R$ million

2,000

134

313

356

41178

390412

1,228

2,042

InitialBalance

EBITD

A

NewFinancing

AmortizationandFin

ancing

Interest

Working

CapitalV

ariation

Investments

Dividend

/Interston

Capital

Others

FinalBalance


14/18

Usiminas shareappreciation of 36%versus 21% ofIbovespa (Jan. toNov 3, 2006)

14

ADRADR

LevelLevel II

9M06 - STOCK PERFORMANCE

50

70

90

110

130

150

dez/05 j an/06 fev/06 mar/06 abr/06 mai/06 jun/06 jul/06 ago/06 set/06

IBOVESPA USIM5 SID

USIM5 vs Ibovespa and Steel IndustryFrom 12/29/2005 to 09/29/2006 (basis 100)

108,9

116,9

125,8


15/18

OUTLOOK

International market : Signs of adj ustment/ accommodat ion in 4Q06 prices. Greater

awareness to avoid inventory growth.

For 2007, forecast for reduction in US growth, compensated byChina and India.

More stable price environment forecasted for 2007.Domestic market :

Demand growth of 8%in 2006 (according to IBS)

2007: total f lat demand growing 8%, influenced by:

- maintenance of high volumes of credit ;- increase in investments in important steel consuming sectors.

15


16/18

Guidancefor 2006:

Total sales: ~ 8.0 MMt, 10%above 2005.

Domestic Market : 67%of sales volume = 9%growth, inline with demand growth estimated by IBS.

Exports: 33%of sales = growth of approximately 12%, withgreater share of heavy plate.

USIMINAS - OUTLOOK

16


17/18

Re-cert if icat ion of Product Quality, Environmental and Worker SafetyCert if icates at the Mil ls.

Issuance of Installation license for Coke Oven #3 by State Environmental

and Development Agency

Usipart s Investments - R$ 46 mil l ion for expansion

Usiminas System is awarded:

.Isto Magazine s 500 Best Companies Guide (Usiminas and Usiparts.Ibase Social Statement Award

.Gazeta Mercatil Award (Rio Negro)

OTHER HIGHLIGHTS


18/18

Other informat ion:Investor Relat ions

18

www.usiminas.com.br

Bruno Seno Fusaro Luciana Valadares dos [email protected] [email protected]

Tel: 55 31 3499-8710 Tel. : 55 31 3499-8619

Matheus Perdigo Rosa Gilson Rodr igues Bentes

mpr osa@usi mi nas.com.br gil [email protected]

Tel: 55 31 3499-8056 Tel: 55 11 5070-8980 SP55 31 3499-8617 BH

Usim Webcast 3q06 Vers

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