Reunião com XIII CEO Conference BTG Pactual Investidores€¦ · XIII CEO Conference BTG Pactual...
Transcript of Reunião com XIII CEO Conference BTG Pactual Investidores€¦ · XIII CEO Conference BTG Pactual...
Reunião com Investidores
XIII CEO Conference
BTG Pactual
February/2012
1
OVERVIEW
Present in 620 of the 853 municipalities in Minas Gerais
Water concessions : 395 municipalities
Water and sewage concessions : 225 municipalities
Not covered by COPASA: 233 municipalities
1
OVERVIEW
• Population served with water supply services
13.5 million inhabitants
98% of the population in the operated cities
3.6 million water connections
43 thousand km of network extension
• Population served with sewage services
8.1 million inhabitants
83% of the population in the operated cities
2 million of sewage connections
16.8 thousand km of network extension 2
ACCOMPLISHED RESULTS From January/2003 to September/2011
WATER
Municipalities with concessions
Population served
Number of connections
Network extension
+ 92.3 million m³ Volume of sewage collected*
+ 118.9 million m³ Volume of sewage treated*
* 2011: Total volume accumulated in the last 12 months (Oct/10 to Sep/11).
+ 3.1 million
+ 26 municipalities
+ 887 thousand
+ 9.1 thousand km
+29.5%
+4.4%
+32.7%
+26.2%
SEWAGE
+43.9%
+211.8%
+ 3.3 million
+ 85 municipalities
+ 925 thousand
+ 6.9 thousand km
+68.2%
+61.6%
+82.8%
+69.6%
3
OWNERSHIP STRUCTURE
Number of shareholders: 2,533 in 38 countries
Volume¹: R$ 7.5 million
Transactions¹: 1,224 Appreciation last 12 months: 49.6%
PRE-IPO (March/2006)
Minas Gerais State (85.5%)
Belo Horizonte Municipality (13.8%)
Free Float (0.7%)
Minas Gerais State (53%)
Free Float (47%)
TODAY
4 ¹ Period 02/14/2011 to 02/13/2012.
IBOVESPA: 3.9%
protection, recovery and conservation of watersheds
118 in operation and 76 under construction
25 thousand hectares preserved in 14 reserves
58% in September 2011
ENVIRONMENTAL COMMITMENT
Treated sewage index
Environmental reserves
Watershed Protection Program
Sewage treatment stations
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REGULATION
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Minas Gerais State Water and Sewage Services
Regulatory Agency ARSAE MG
Methodology for annual tariff adjustment already defined –
Normative Resoultion 003/2011;
7.02% - Tariff adjustment for 2011 calculated according to
the methodology;
TARIFF ADJUSTMENT METHODOLOGY
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VPB = PORTION-B
Manageable
costs
VPA = PORTION-A
Non-manageable
costs = +
AUTHORIZED
REVENUE
(RA)
RA (Authorized Revenue) is the tariff at moment 0 (T0),
considering the Market of Reference (MR), which is the
market as seen between the adjustments.
Portion A (VPA): Non-Manageable Costs
Item
Eletric Power
Chemical products
Fuel and lubricants
Telecomunication
Taxes and fees
Portion B (VPB): Manageable Costs
Item Index Personnel INPC/IBGE
Material IGP-DI/FGV
General IPCA/IBGE
Amortization and depreciation INCC-DI/FGV Services IPCA/IBGE
Unit costs.
Portion-A variantion account.
TARIFF ADJUSTMENT METHODOLOGY
Tariff Adjustment Breakdown
Portion Weight Adjustment Index
Portion-A: Non-Manageable Costs 18% 6.24%
Portion-B: Manageable Costs 82% 7.19%
AUTHORIZED ADJUSTMENT 7.02%
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STRENGTHS
Revenue Guaranteed by Concession Agreements
Diversified Customer Basis
Availability of Water Resources
Strong Growth Potential
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Operating Efficiency
Solid Financial Position
concession agreements with formal authorization laws from the municipality;
78% of revenues guaranteed by concession agreements expiring after 2028.
Revenue Guaranteed by Concession Agreements
GUARANTEED REVENUES
10
Residential (88.8%)
Public (1.4%)
Commercial (9.2%)
Industrial (0.6%)
Residential (68.3%)
Public (10.3%)
Commercial (15.3%)
Industrial (6.1%)
Consumer Units (water+sewage) Revenue by Category (water+sewage)
10 biggest clients represent 6.1% of our total revenue
50 biggest clients represent 8.4% of our total revenue
DIVERSIFIED CUSTOMER BASIS
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OPERATING EFFICIENCY
12
1,9
65
1,4
71
1,2
62
1,1
70
86
5
68
9
67
3
65
8
65
4
61
5
61
3
61
3
48
4
47
3
44
2
40
1
39
4
33
1
33
0
29
8
29
3
29
1
27
5
23
7
23
1
21
9
20
4
Average (State Sanitation Companies)
COPASA
Source: SNIS 2009 (National Sanitation Data System)
1.29% Default Ratio one of the lowest in the sector
(liters per connection/day) Loss Index one of the lowest in the sector
231.2 liters per connection/day in September 2011
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AVAILABILITY OF WATER RESOURCES
Minas Gerais 27.6* Espírito Santo
Rio de Janeiro 5.3*
São Paulo 6.3*
Comparison with the main States in Brazil (m³/inhab./day)*
Demand x Availability Granted (m³/s)
Current demand
53.8
25.4
28.4
Additional capacity of 89.4% over current demand for hydric resources
Availability granted
North Region
Center-West Region Southeast
Region
South Region
Northeast Region
5.3 6.3
27.6
STRONG GROWTH POTENTIAL
10 14
853
233
395
225
Municipalities 2003
260
453
140
2011
Coverage expansion: Obtaining sewage concessions in cities where COPASA supplies water; Obtaining new concessions where COPASA not yet operates; Expansion of service in cities where COPASA already operates.
Strategies
Includes cities operated by COPANOR.
EXPANSION PLAN 2011-2013
15
4 concessions signed – 391,000 inhabitants
2 authorizing laws voted
25 concessions in negotiation
4 concessions signed – 32,000 inhabitants
23 authorizing laws voted
66 concessions in negotiation
31 concessions in negotiation
Obtain sewage concessions in cities where COPASA owns water concessions
Obtain water and sewage concessions in cities where COPASA doesn’t own concessions
POPULATION OVER 15,000 INHABITANTS
Nº of municipalities 31
Population (thousands) 1,500
POPULATION UNDER 15,000 INHABITANTS
Nº of municipalities 93
Population (thousands) 600
POPULATION OVER 15,000 INHABITANTS
Nº of municipalities 31
Population (thousands) 1,400
STRONG GROWTH POTENTIAL
Results
Water Connections (thousand)
2,718 2,780 2,855 2,928 3,036 3,174 3,290 3,385 3,501 3,471 3,597
2002 2003 2004 2005 2006 2007 2008 2009 2010 - 3T10 3T11 3Q11C
Sewage Connections (thousand)
1,132 1,164 1,285 1,330 1,392 1,519 1,668
1,857 1,956 1,932 2,043
2002 2003 2004 2005 2006 2007 2008 2009 2010 - 3T10 3T11 3Q10 3Q11
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3Q10 3Q11
STRONG GROWTH POTENTIAL
CAPEX (R$ million)
Average 1992/2002
Average 2003/2005
Average Post IPO
2006/2010
Water 107 181 407
Sewage 68 207 437
Others 9 51 29
Total 184 439 870
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INVESTMENTS
STRONG GROWTH POTENTIAL
18
CAPEX ( R$ million)
Forecast Accomplished
2011 9M11
Water 271 201
Sewage 462 270
Others 17 15
Total 750 486
2012: R$ 850 million
INVESTMENTS
STRONG GROWTH POTENTIAL
Financial Performance
3Q11
CASH GENERATION
20
Net Operating Revenue (R$ million)¹
878
1,109 1,194 1,476 1,682 1,863 2,060 2,201 2,321
599 662
2002 2003 2004 2005 2006 2007 2008 2009 2010 - 3Q10 3Q11
1. Does not include Construction Revenues arising from the convergence into IFRS (Financial Statements from
2008 onwards) or Revenues from Finished Products.
2. EBITDA adjusted to non-recurring items.
285 400 466
586 656 666 608
935
253 277
2002 2003 2004 2005 2006 2007 2008 2009 2010 - 3Q10 3Q11
763 825 923
2
1,236
929
EBITDA (R$ million)
2 2 2
INCOME
1. Amount reported in 2008 and subsequently changed to recognize tax debts.
94
253 289 356 329
274
525
677
119 120
2003 2004 2005 2006 2007 2008 2009 2010 - 3Q10 3Q11
6.8 13.3
14.0 11.0 9.4 8.1
14.0 16.2
Net Income
ROE (%)
Net Income (R$ million)
407¹
21
R$ 123 million (R$ 1.07 per share). Up to 3Q11
Dividends paid as Interest on Equity – IOE:
35% of Net Income for the year 2011.
INDEBTEDNESS
22
Short Term Long Term
Net Debt (R$ million)
872
1,000 1,065
383
645
1,022
1,647
2,170 2,284
2003 2004 2005 2006 2007 2008 2009 2010 Sep/11
2.2 2.1 1.8
0.6 0.8 1.3 1.5 1.8 1.7
Net Debt / EBITDA
89 105 111 129 166 202 227 278 558
796 921 1,017
1,084 1,468
1,612 1,835
1,970
2,036
2003 2004 2005 2006 2007 2008 2009 2010 Sep/11
Gross Indebtedness (R$ million)
INDEBTEDNESS
23
Amortization Schedule (R$ million)¹ and Debt Indexes
Average rate: 8.6% p.a³
32%
2% 53%
2% 5% 6% TR
USD TJLP
IGPM INPC CDI
Debt Indexes
1. As of September 30th, the Company had R$ 1,272 million of funds contracted from the Government Severance Indemnity Fund (FGTS) and the Brazilian
Development Bank (BNDES) to be disbursed and recorded in liabilities as investments are made. The average grace period remaining of these funds is 10 and 36 months respectively, with amortization terms of 240 and 180 months respectively, therefore they are not displayed in the chart. Additionally, the Board of Directors approved, on October 21st, 2011, the contracting of a long-term operation in the amount of R$ 400 million.
2. Including debentures convertible into shares, in the amount of R$ 140 million, 50% of which maturing by the end of May 2012, and the remaining by the end of May 2013. In the year 2012 are also included promissory notes in the amount of R$ 148 million, maturing in July 2012. Additionally, the Board of Directors approved, on October 21st, 2011, the contracting of a long-term operation in the amount of R$ 400 million.
3. With the exception of contracts with BNDES, all loans still have their remaining balances pegged to specific indexes, such as TR, IGP-M, INPC, CDI, and USD forex.
www.copasa.com.br/ir
Rio das Velhas Production System
Disclaimer: This document may contain future considerations on COPASA’s business prospects. These are mere projections, being, therefore, entirely based on COPASA’s management expectations regarding the future of the business. Such forward-looking statements are subject to risks and uncertainties which depend on factors including economic, political, financial and commercial conditions in the markets where we operate. Investors are hereby advised that these forecasts are no guarantee of future performance since they involve risks and uncertainties.