2007 - First Quarter 2007 Results
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Transcript of 2007 - First Quarter 2007 Results
May 15, 2007
First Quarter 2007 Results
THE INFORMATION CONTAINED HEREIN IS PROPERTY OF EMBRAER AND SHALL NOT BE COPIED OR DISSEMINATED WITHOUT EMBRAER’S WRITTEN CONSENT
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 presentation might not occur. Our
actual results could differ substantially from those anticipated in our forward-looking
statements.
THE INFORMATION CONTAINED HEREIN IS PROPERTY OF EMBRAER AND SHALL NOT BE COPIED OR DISSEMINATED WITHOUT EMBRAER’S WRITTEN CONSENT
First Quarter 2007 - Summary
• Due to difficulties with the supply chain 25 jets were delivered in 1Q07 compared to 27 aircraft in 1Q06
• Revenues benefited by the product mix –Net revenues up 4.3%.
• Gross margin negatively affected by:- US$12.9 million non-recurrent adjustment in work-in-progress inventories;
- longer production lead time and
- higher labor costs including those related to overtime work
27
36
30
37
25
1Q06 2Q06 3Q06 4Q06 1Q07
843
1,084
8941,021
808
28.7%
25.7%27.5%
28.3%28.2%
1Q06 2Q06 3Q06 4Q06 1Q07
Jet Deliveries
Net revenues – Gross Margin
THE INFORMATION CONTAINED HEREIN IS PROPERTY OF EMBRAER AND SHALL NOT BE COPIED OR DISSEMINATED WITHOUT EMBRAER’S WRITTEN CONSENT
• Backlog reached record high of US$15.0 billion
• 11 firm orders for E-Jets announced – M1 travel Ltd and AlpiEagles joined the customer base. Option confirmation from Virgin Blue
• Firm orders for the Phenom 100 and Phenom 300 are nearing 400 units
First Quarter 2007 - Summary
Firm Order Backlog (US$ Billion)
10.4 10.2
13.315.014.8
1Q06 2Q06 3Q06 4Q06 1Q07
THE INFORMATION CONTAINED HEREIN IS PROPERTY OF EMBRAER AND SHALL NOT BE COPIED OR DISSEMINATED WITHOUT EMBRAER’S WRITTEN CONSENT
Labor:
• 2,000 employees hired since January 2007;
• By June 2007 – a total of 3,500 new employees dedicated to the production;
• Third shift to be fully implemented by the 3Q07.
Industrial capabilities:
• Assembly jigs added to the wing assembly and fuselage sections;
• Intensified approach with sub-contracted suppliers;
First Quarter 2007 - Summary
Actions taken towards...
...increasing the production to deliver 165 / 170 jets
THE INFORMATION CONTAINED HEREIN IS PROPERTY OF EMBRAER AND SHALL NOT BE COPIED OR DISSEMINATED WITHOUT EMBRAER’S WRITTEN CONSENT
Results & Performance
THE INFORMATION CONTAINED HEREIN IS PROPERTY OF EMBRAER AND SHALL NOT BE COPIED OR DISSEMINATED WITHOUT EMBRAER’S WRITTEN CONSENT
Jet Deliveries
27
36
30
37
25
1Q06 2Q06 3Q06 4Q06 1Q07
THE INFORMATION CONTAINED HEREIN IS PROPERTY OF EMBRAER AND SHALL NOT BE COPIED OR DISSEMINATED WITHOUT EMBRAER’S WRITTEN CONSENT
US$ million
Net Revenues and Gross Margin
843
1,084
8941,021
808
28.7%
25.7%27.5%
28.3%28.2%
1Q06 2Q06 3Q06 4Q06 1Q07
THE INFORMATION CONTAINED HEREIN IS PROPERTY OF EMBRAER AND SHALL NOT BE COPIED OR DISSEMINATED WITHOUT EMBRAER’S WRITTEN CONSENT
Net Revenue by Segment
1Q06 1Q07
Defense and
Government 10%
Executive
Aviation 11%
Commercial
Aviation 62%
Customer
Services and Others 17%
Commercial
Aviation65%
Defense and
Government 5%
Executive
Aviation14%
Customer
Services and Others16%
THE INFORMATION CONTAINED HEREIN IS PROPERTY OF EMBRAER AND SHALL NOT BE COPIED OR DISSEMINATED WITHOUT EMBRAER’S WRITTEN CONSENT
EBITDA
62
151
7585 23
14,8%
7,6%8,3%
7,8%
2,7%
1Q06 2Q06 3Q06 4Q06 1Q07
Ebitda Ebitda Margin
THE INFORMATION CONTAINED HEREIN IS PROPERTY OF EMBRAER AND SHALL NOT BE COPIED OR DISSEMINATED WITHOUT EMBRAER’S WRITTEN CONSENT
Net Income
US$ Million
65
139
61
124
26
3.1%
11.5%
6.9%8.1%
13.6%
1Q06 2Q06 3Q06 4Q06 1Q07
Net Income Net Margin
THE INFORMATION CONTAINED HEREIN IS PROPERTY OF EMBRAER AND SHALL NOT BE COPIED OR DISSEMINATED WITHOUT EMBRAER’S WRITTEN CONSENT
Aircraft Financing Support
US$ Million
215.9174.4 164
217.4 223.4
135.5139.6
32.4
1Q06 2Q06 3Q06 4Q06 1Q07
CCF Acc Rec
THE INFORMATION CONTAINED HEREIN IS PROPERTY OF EMBRAER AND SHALL NOT BE COPIED OR DISSEMINATED WITHOUT EMBRAER’S WRITTEN CONSENT
US$ Million
Inventories
1,648 1,6391,882
2,0472,317
1Q06 2Q06 3Q06 4Q06 1Q07
THE INFORMATION CONTAINED HEREIN IS PROPERTY OF EMBRAER AND SHALL NOT BE COPIED OR DISSEMINATED WITHOUT EMBRAER’S WRITTEN CONSENT
US$ Million
Net Cash (Debt) Position
302
527 507
416
217
1Q06 2Q06 3Q06 4Q06 1Q07
THE INFORMATION CONTAINED HEREIN IS PROPERTY OF EMBRAER AND SHALL NOT BE COPIED OR DISSEMINATED WITHOUT EMBRAER’S WRITTEN CONSENT
Total Debt of US$ 1,224.3 Million
• Average cost in R$ = 7.1%p/a
• Average cost in US$ =Libor + 1.69% p/a
Loans
Long-Term Loan Average Maturity: 4 years and 9 months
Short Term 36%
Long Term 64%
Brazilian Currency
21%
Foreign Currency
79%
THE INFORMATION CONTAINED HEREIN IS PROPERTY OF EMBRAER AND SHALL NOT BE COPIED OR DISSEMINATED WITHOUT EMBRAER’S WRITTEN CONSENT
Loans Maturity
US$ million
4 4 6
9 1
9 93 3
4 9 1
1, 2 2 4 6 4
Total Short-term
2008 2009 2010 2011 after2011
THE INFORMATION CONTAINED HEREIN IS PROPERTY OF EMBRAER AND SHALL NOT BE COPIED OR DISSEMINATED WITHOUT EMBRAER’S WRITTEN CONSENT
Backlog and Delivery Forecast
THE INFORMATION CONTAINED HEREIN IS PROPERTY OF EMBRAER AND SHALL NOT BE COPIED OR DISSEMINATED WITHOUT EMBRAER’S WRITTEN CONSENT
ERJ 145 Family Order Book
(1st Quarter 2007)
53
53
-
-
FirmBacklog
8611,046132914Total
679864132732ERJ 145
7474-74ERJ 140
108108-108ERJ 135
DeliveriesTotalOptionsFirm Orders
THE INFORMATION CONTAINED HEREIN IS PROPERTY OF EMBRAER AND SHALL NOT BE COPIED OR DISSEMINATED WITHOUT EMBRAER’S WRITTEN CONSENT
EMBRAER 170/190 Family Order Book
395955144EMBRAER 195
401
262
70
30
Firm
Backlog
2291,188558630Total
65546241327EMBRAER 190
2923513699EMBRAER 175
130290130160EMBRAER 170
DeliveriesTotalOptionsFirm Orders
(1st Quarter 2007)
THE INFORMATION CONTAINED HEREIN IS PROPERTY OF EMBRAER AND SHALL NOT BE COPIED OR DISSEMINATED WITHOUT EMBRAER’S WRITTEN CONSENT
Backlog
US$ Billion
10.213.3 14.8 15.0
15.3 15.914.9
18.2 18.2
10.4
1Q06 2Q06 3Q06 4Q06 1Q07
Firm Options
THE INFORMATION CONTAINED HEREIN IS PROPERTY OF EMBRAER AND SHALL NOT BE COPIED OR DISSEMINATED WITHOUT EMBRAER’S WRITTEN CONSENT
Jet Deliveries Forecast
160 161
131
101
148 141130
195/205
165/170
2000 2001 2002 2003 2004 2005 2006 2007E 2008E*
Investor RelationsPhone: + 5512 [email protected]