Post on 03-Jul-2015
2nd Quarter 2003Financial Results
US GAAPAugust 14, 2003
Figures in US GAAP
Forward 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 press releasemight not occur. Our actual results could differ substantially from those anticipated in our forward-looking statements.
Figures in US GAAP
Second Quarter Highlights• Real (R$) appreciation against US Dollar (US$):
ü Negative impact on Gross Margin
ü Contribution to a higher R&D expense
ü Non-realized $85MM loss on swap transactions
• Successive Trade Accounts Receivables collection postponments:
ü Short-term debt and financial expenses increase
ü Mismatched real-denominated assets and liabilities
US$ 4.9 MM Net Income
Figures in US GAAP
Second Quarter Highlights• 4 new orders for the EMBRAER 170/190 new jet family:
ü US Airways - 85 firm orders for the EMBRAER 170
ü JetBlue Airways - 100 firm orders for the EMBRAER 190
ü LOT - 10 firm orders for the EMBRAER 170
ü Undisclosed - 10 firm orders for the EMBRAER 190
• Intention of establishing an industrial facility in Jacksonville:
ü It will be used to supply aircraft for the US defense and national security markets
• EMBRAER 175 first flight took place successfully in June.
• Embraer revised the total number of jets to be delivered:
ü In 2003 – from 132 to 110
ü In 2004 – from 136 to 160
• 23 Legacy Shuttle from Indigo excluded from backlog.
Figures in US GAAP
206
79
106
21
Firm
Backlog
6701361485876Total
5021015434581E RJ 145
6821945174ERJ 140
1001276121ERJ 135
DeliveriesTotalOptionsFirm
Orders
ERJ145 Family Orderbook
June / 2003
Figures in US GAAP
EMBRAER 170/190 Family Orderbook
230120110EMBRAER 190
553309244Total
473215EMBRAER 195
276157119EMBRAER 170
TotalOptionsFirm Orders
June / 2003
Figures in US GAAP
Backlog
US$ billion
10.37.99.0
10.711.4
6.44.13.0
1.2
16.8
11.3
13.212.712.7
11.3
0
5
10
15
20
25
30
1996 1997 1998 1999 2000 2001 2002 1Q03 2Q03
Options
Fi rm Orders
1.23.0
4.1
17.7
24.123.4
22.2
19.2
27.1
Income StatementHighlights
Figures in US GAAP
Jet Deliveries
Units
23
28
41
303030
1Q02 2Q02 3Q02 4Q02 1Q03 2Q03
Figures in US GAAP
US$ Exchange Rate Volatility
1 %
2 0 %
3 7 %
-9%-5%
-14%
1T02 2T02 3T02 4T02 1T03 2T03
Final Rate
Figures in US GAAP
US$ Million
Net Sales & Gross Margin
798
489567
557
581590
36.5%
39.9% 39.2% 39.3% 39.1%39.7%
0
250
500
750
1 0 0 0
1 Q 0 2 2 Q 0 2 3 Q 0 2 4 Q 0 2 1 Q 0 3 2 Q 0 3
3 0 %
4 0 %
Figures in US GAAP
US$ Million - 2Q03
Cost of Goods Sold
2.7%9.4%
87.9%
Material Labor Others
Figures in US GAAP
Sales per Segment
First Half 2003
Sales per Market
First Half 2003
Revenue Breakdown
Customer
Serviçes
6 %
Corporate
9 %
Defense
9 %
Comerc ia l
76%
Foreing
Market
97%
Brazil
3%
Figures in US GAAP
US$ Million
SG&A and Others Expenses
Note: SG&A includes Profit Sharing and does not include R&D
8576
91
124
7686
15.1%15.5%15.5%15.7%
13.0%
15.2%
-
30
60
90
120
150
1Q02 2Q02 3Q02 4Q02 1Q03 2Q03
0%
3%
6%
9%
12%
15%
18%
SG&A and Others SG&A , Others (% of Net Sales)
Figures in US GAAP
US$ Million
R&D
41
35
26
46
36
51
9.1%
7.3%
4.5%
6.0%
7.4%
5.8%
-
20
40
60
1Q02 2Q02 3Q02 4Q02 1Q03 2Q03
0%
2%
4%
6%
8%
10%
R&D R&D (% of Net Sales)
Figures in US GAAP
US$ Million
Income from Operations
142
83 70119 11197
12.3%
17.0%17.9%
19.1%20.3%
17.3%
0
2 0 0
4 0 0
1Q02 2Q02 3Q02 4Q02 1Q03 2Q03
10%
15%
20%
25%
Figures in US GAAP
Net Income & Margin
77
44
5
4137
68
12.2%
6.2%7.0%
9.7%9.0%
0.9%0
50
100
150
1Q02 2Q02 3Q02 4Q02 1Q03 2Q03
0%
5%
10%
15%
US$ Million
Figures in US GAAP
Net Income 1Q03 x 2Q03
- -
44
(1)
78 ( 66)
(26)
(83)
58 5
1Q03 NET SALES COGS operating
expense
Financial
transaction
Non-
operating
Taxes 2Q03
Balance SheetHighlights
Figures in US GAAP
Trade Accounts Receivable
US$ Million
7 0 7
2 4 73 2 6
7 3 6
9 1 3
7 9 0
1 Q 0 2 2 Q 0 2 3 Q 0 2 4 Q 0 2 1 Q 0 3 2 Q 0 3
Note: In the short-term
Figures in US GAAP
Trade Accounts Receivable
US$ Million
548 511
213
232
287
147
143
243
44
27
47
4Q02 1Q03 2Q03
BNDES BNDES negot iat ion Market Others
736
913
790
Figures in US GAAP
Inventories
995 992
946
865
1013 1005
1Q02 2Q02 3Q02 4Q02 1Q03 2Q03
US$ Million
Figures in US GAAP
Inventories by program
81 82 75 74
775 749707
575659
613
67 8097
110
141 196
72 8167
105
128 130
75 77
995 992946
1,0131,005
865
0
200
400
600
800
1000
1Q02 2Q02 3Q02 4Q02 1Q03 2Q03
Others E R J 1 4 5 F a m i l y / L e g a c y E M B R A E R 1 7 0 / 1 9 0 D e f e n s e
Figures in US GAAP
Net Cash (Debt)
US$ Million
39
360
217
104
(212)
43
1Q02 2Q02 3Q02 4Q02 1Q03 2Q03
Figures in US GAAP
Bank Debt - US$ 825.4 million
June 30, 2003
Loans Breakdown
Debt MaturityCurrency Breakdown
• Considering Currency Swaps• Average R$ debt cost : 19.5% p.a. (74.8% of CDI)• Average US$ debt cost: 5.5% p.a.
• Loan Average Maturity: 2 years and 7 months
Long
Term
39%
Short
Term
61%
US$
42%
R$
58%
Balance SheetCurrencyExposure
Figures in US GAAP
Balance Sheet by currency
16% 12% 11% 11% 15% 14%
74%88%
79%89% 85% 87%
10%10%
Assets Liabilities Assets Liabilities Assets Liabilities
12/31/2002 03/31/2003 06/30/2003
R $ US$ (BNDES) US$
Without swap
Figures in US GAAP
Balance Sheet by currency
16%23%
11%26%
15%26%
74% 77% 79% 74%85%
74%
10%10%
Assets Liabilities Assets Liabilities Assets Liabilities
12/31/2002 03/31/2003 06/30/2003
R $ US$ (BNDES) US$
With swap