Call 3Q10

CONFERENCE CALL

PRESENTATION 3Q10 EARNINGS

BM&FBovespa: VLID3

HIGHLIGHTS

Highlights (R$ million) 3Q09 3Q10 9M09 9M10

Net Revenue 185.8 194.9 547.5 533.9Net Revenue 185.8 194.9 547.5 533.9

EBITDA¹ 40.8 44.8 119.1 121.2

EBITDA Margin² 22.0% 22.6% 21.8% 21.7%

Net Income³ 21.3 25.9 63.9 68.5

Net Margin 11. 5% 12.3% 11.7% 12.0%

\\ Net Income³ came to R$25.9 million in 3Q10, a significant 21.6% growth over 3Q09;

¹ EBITDA ajusted for extraordinary expenses2 EBITDA margin does not include equity pick up.³ Adjusted for deferred liabilities related to income tax and social contribution and extraordinary expenses.

\\ Net Income³ came to R$25.9 million in 3Q10, a significant 21.6% growth over 3Q09;

\\ EBITDA¹ of R$44.8 million in 3Q10 was year’s highest;

\\ Strong recovery by Printing Services Division;

\\ Record cash generation: R$65.6 million in 3Q10;

\\ Change in the Company’s corporate name.

NET REVENUE AND EBITDA BREAKDOWN

\\

Net Revenue

\\ Balanced revenue mix

\\33.4%

30.7%

35.9% Cards

ID Systems

Printing Services

EBITDA

\\ Focus on higher margins businesses32.2%

49.3%

18.5%

Cards

ID Systems

Printing Services

CARDS

Cards (R$ million) 3Q09 3Q10 9M09 9M10


EBITDA 15.8 13.7 42.8 39.9

EBITDA Margin 23.8% 21.1% 23.3% 20.6%

Sales Volume (million) 148.7 116.4 430.7 351.5

Equity pickup 0.7 0.7

\\ Volume of cards was 21.7% lower than in 3Q09;

\\ Revenue of R$65.0 million in 3Q10, 2.1% down from 3Q09;\\ Revenue of R$65.0 million in 3Q10, 2.1% down from 3Q09;

\\ EBITDA margin came to 21.1%, 2.7 p.p. down from 3Q09, but 1.6 p.p. up over 2Q10;

\\ Increase in financial smart cards in 3Q10 offset the slowdown in SIM cards.

ID SYSTEMS

ID Systems (R$ million) 3Q09 3Q10 9M09 9M10


EBITDA 20.0 22.1 59.6 63.1

EBITDA Margin 37.2% 37.0% 38.4% 37.2%

Sales Volume (million) 4.0 3.9 11.4 11.4

\\ Volumes in 3Q10 similar to 3Q09;

\\ 11.3% increase in Revenue over 3Q09;\\ 11.3% increase in Revenue over 3Q09;

\\ EBITDA grew 10.5% over 3Q09;

\\ Average price increase of 14%.

PRINTING SERVICES

Printing Services (R$ million) 3Q09 3Q10 9M09 9M10


EBITDA 5.0 8.3 16.7 17.5

EBITDA Margin 7.6% 11.9% 8.0% 9.2%

Sales Volume (thousand tons) 4.8 2.9 14.4 9.6

\\ Selective reduction of product portfolio generated positive results;

\\ Volume in 3Q10 was 39.6% lower than in 3Q09;

\\ Revenue in 3Q10 grew 6.7% over 3Q09;

\\ EBITDA grew 66.0% over 3Q09;

\\ EBITDA margin came to 11.9% in 3Q10, 4.3 p.p. above the 3Q09 margin.

3Q10 Cash Flow R$ million

Beginning Cash 75.7

CASH FLOW

Beginning Cash 75.7

Generated 65.6

Capex + Acquisition (15.9)

Dividends / Interest on Equity (7.0)

Loans (0.2)

Others (1.1)

Closing Balance 117.1

DIVIDENDS + INTEREST ON EQUITY

74,274

81,214

2007

66,739

25,354

71,862

23.120

74,274

25,64524,518

2008

32% 35% 30%38%

2006 20092007

Net Income Dividends + Interest on Equity

20082006 2009

INDEBTEDNESS

R$ millon Debentures

Gross Debt 190.5 R$ 180 million� Gross Debt 190.5 � R$ 180 million

� Cash 117.1 � Issued: Apr / 2008

� Net Debt 73.4 �First Installment: Apr / 2011

� Net Debt / EBITDA* 0.50 �Interest: CDI + 1.5% p.a.

� EBITDA* / Financial Expense* 7.73 �Term: 5 years

�Grace Period: 3 years

�CovenantsNet Debt / EBITDA ≤ 2.5EBITDA / Financial Expense ≥ 2.0

* Accumulated in the last 12 months.

OUTLOOK 2010

\\ Revenue: 5%-10% Growth;

\\ EBITDA: 10%-15% Growth.

INVESTOR RELATIONS CONTACTS

For additional information, contact IR Area:

Carlos Affonso D’Albuquerque

CFO and IRO

[email protected]

+55 (21) 2195-7202

+55 (21) 9584-1338

Investor Relations Website : www.abnote.com.br/ir

Fabio Bueno

Financial and IR Manager

[email protected]

+55 (21) 2195-7230

+55 (21) 9540-6409

Av. Presidente WIlson, 231 - 16° Andar - Rio de Janeiro - RJ - CEP 20030-905

FORWARD-LOOKING STATEMENTS

This release contains forward-looking statements relating to the prospects of the business, estimates for operating

and financial results, and those related to growth prospects of Valid. These are merely projections and, as such,

are based exclusively on the expectations of Valid’s management concerning the future of the business and its

continuous access to capital to finance the Company’s business plan. Such forward-looking statements depend,

substantially, on changes in market conditions, government regulations, competitive pressures, the performance

of the Brazilian and international economies and the industry, among other factors, besides the risks presented in

the documents filed by Valid and are, therefore, subject to change without prior notice.

Call 3Q10

Investor Relations

Transcript of Call 3Q10