Tereos apresentacao 4_t12_2013_eng

Tereos Internacional 2012/13 Year End Results

São Paulo – June 13th, 2013

1. Financial Highlights

2. Major Developments

3. Market and Financial Update

4. Operating Segment Review

4. Cash Flow and Debt Position

5. Outlook

2

3

4

5

6

1

2012/13 Financial Highlights

3

Revenues : R$7.6 billion + 11.1%, as reported

4-year CAGR of 15.1%

Adjusted EBITDA*: R$869 million - 9.4%, as reported

4-year CAGR of 4.2%

Net Profit (group interest): - R$0.2 million

Dividends: R$0.046 per share

1

* Adjusted EBITDA: EBITDA excluding items from discontinued operations, accounting effect of adjustments in the fair value of the financial instruments

(including one-off accounting results for the trading derivatives booked in other operating item) and of the biological assets

2012/13 Key Initiatives and Major Developments

4

Agricultural & industrial competitiveness

Guarani 2015/16: efficiency/investment program in place

Agriculture: replanting program and mechanization

Cogeneration in Guarani: investments continued at Mandu and São José industrial plants

International development and product portfolio diversification

Syral Europe: start of dextrose production at Saragossa (Jan, 2013) and Lillebonne (Mar, 2013)

Syral Brazil: start of production trials at Palmital corn-based starch facility (May, 2013)

Syral China: start of construction of Dongguan wheat-based starch facility (Nov, 2012)

Growth

Sugarcane planting in Brazil: further expansion of surfaces

Starch production in China: extension of the partnership with the Wilmar Group to a broader portfolio of raw materials, now including corn and potatoes, together with the acquisition of a 49% stake in Tieling corn starch facility (closing expected to H2 13/14, pending regulatory approvals)

Finance

Shareholder reorganization & capital increase: corporate structure simplified (free float increase from 10.7% to 29.3%), together with a share capital increase of R$370 million, 100% subscribed

Capital injection from PBio at Guarani: R$212.2 million (PBio now owns 35.8%)

Refinancing at Tereos EU: syndicated credit facility of €450 million extended by 2 years to June 2017, simplifying the existing structure and covenant requirements

2

Sugar:

Recovery of Brazilian production and exports in 2012/13 which

improved 9% and 20%, respectively

Another global surplus pressuring prices: estimate of 6.1 million

tonnes surplus for 2013/14 crop (April/March basis)

Price direction moving forward to be dependent on producers’

response to lower sugar prices and ethanol production mix in Brazil

Starch:

Historical drought in the US led to a rally in corn prices in H2 2012

Brazil overtook the US as the largest corn exporter

Estimates for the new 2013/14 world crop are optimistic, pointing to a

record corn and wheat production already weighing down on prices

Ethanol:

Production and exports in Brazil increased in 2012/13; recent

government incentives should shift mix towards ethanol production

Lower US corn prices should support producers’ margins and boost

US production, which should lower imports from Brazil

T2 FOB Rotterdam prices were relatively flat as demand remained

sluggish; EU Commission ruled against US imports and to review

blending targets 5

Source: Bloomberg

Market Highlights 3

300

400

500

600

700

800

Jan-12 Apr-12 Jul-12 Oct-12 Jan-13

NY#11 LIFFE #5

US$/MT

170

190

210

230

250

270

Jan-12 Apr-12 Jul-12 Oct-12 Jan-13

Corn Matif Wheat Matif

€/MT

400

500

600

700

800

700

1000

1300

1600

1900

Jan-12 May-12 Sep-12 Jan-13

Brazil ESALQ Europe Rotterdam

R$/m³ €/m³

6,876 7,640

+517 +161 +70 +17

2011/12 Currency Volume Price & Mix Others 2012/13

0 0 1,089 1,239

2,846 3,381

826 941

2,115 2,079

2011/12 2012/13

Brazil IndianOcean /Africa

StarchEurope

EthanolEurope

Other

6,876 7,640

2012/13 – Revenues Starch & Sweeteners and Sugarcane volumes supporting revenues growth

6

Net Revenues (R$ MM)

3

+11.1%

Revenue growth supported by:

Higher sales volumes in sugarcane and Starch & Sweeteners segments (including Haussimont perimeter effect)

Higher prices for starch & sweeteners

But partially offset by:

Lower prices in the Brazilian sugar and ethanol business

Output decrease for the Alcohol & Ethanol Europe segment due to difficulties of gluten line start-up in Lillebonne

-19 -9

151 71

246 223

158 190

424 393

2011/12 2012/13

Brazil IndianOcean /Africa

StarchEurope

EthanolEurope

Other

959 869

2012/13 - Adjusted EBITDA Lower EBITDA mainly due to higher cereal prices and reduced ethanol volumes in Europe

7

Adjusted EBITDA down year-on-year as a consequence of:

Increase in cereal purchase prices not fully passed onto customers

Technical issues for the start-up of BENP Lillebonne gluten line lowering ethanol output

Lower prices in the Brazilian sugar & ethanol business

But partially compensated by:

Higher volumes in the sugarcane businesses (including higher energy sales in Brazil)

Positive price and mix effect in the Indian Ocean

Adjusted EBITDA (R$ MM)

3

Margin 11.4% Margin 13.9%

-9.4%

959

(31)

+32

(22) (80)

+11

869

2011/12 Brasil Oc. Índico /África

Amido &Adoçantes

Álcool &Etanol

Outros 2012/13

7,640

752 678 779 865

2,701 2,5113,156

3,754

239 540

826

941

1,3191,957

2,115

2,079

2009/10 2010/11 2011/12 2012/13

Alcohol & Ethanol Europe Starch & Sweeteners

Indian Ocean/Africa Brazil

Net Revenues Evolution 4-Year CAGR: 15.1%

5,688

5,011

6,876

+58%

+294%

+39%

+15%

3

R$ MM

Note: based on old segmentation and as reported

8

4-year growth

81 51 95 10

395292

302

285

13

93158

190

281 428

424

393

-14 -19 -9

2009/10 2010/11 2011/12 2012/13

Alcohol & Ethanol Europe Starch & Sweeteners

Indian Ocean / Africa Brazil

Other

959

850 869

Adjusted EBITDA Evolution 4-Year CAGR: +4.2%

771

+40%

15x

-28%

-88%

3

R$ MM

Note: based on old segmentation and as reported

9

4-year growth

249 251

401 380 376

Q4

11/1

2

Q1

12/1

3

Q2

12/1

3

Q3

12/1

3

Q4

12/1

3

4.7

8.1

5.4

Q4

11/1

2

Q1

12/1

3

Q2

12/1

3

Q3

12/1

3

Q4

12/1

3

Ethanol Sales (‘000 m³) Sugarcane Crushing (MM t) Sugar Sales (‘000 t)

10

+50.8% YoY -0.7% YoY

Sugarcane Brazil – Production & Sales Renewal and expansion programs already contributing to higher crushing

Own Sales Trading

4

Crushing

Recovery in sugarcane volume: 18.2 million tonnes processed (95% mechanized for own sugarcane) and expectation of c. 20 million tonnes for the next crop

Yields improving from 70 t/ha to 84 t/ha in 2012/13 but lower TRS (135 vs. 138 kg/tonne last year)

55,000 hectares planted in 2012/13

Average age of sugarcane: improving from 3.7 years in 2011/12 to 3.3 years in 2012/13

Flexibility of industrial set-up allowing focus on more profitable sugar production

Sugar: 1.5 million tonnes 64% of mix vs. 62% last year

Ethanol: 528,000 m³ 36% of mix

Progress on cogeneration

Annual volumes up 43%, with portion of volumes sold at higher spot prices

Expect to double own cogeneration sales in 2013/14 crop

151 115 99

143 150

40

Q4

11/1

2

Q1

12/1

3

Q2

12/1

3

Q3

12/1

3

Q4

12/1

3

Energy Sales (‘000 MWh)

+88.9 YoY

Own Sales Trading

18 50

182

118

34

68 43

57

30

9

Q4

11/1

2

Q1

12/1

3

Q2

12/1

3

Q3

12/1

3

Q4

12/1

3

2,115 2,079

(119)

+111

(57)

+29 0

2011/12 Price &Mix

Volume Price &Mix

Volume Others * 2012/13

Sugarcane Brazil – Financials Increased volume impact offset by lower sugar and ethanol prices

* includes Cogeneration, Agricultural Products, Hedging and Ethanol Resale

Key Figures

In R$ Million 2012/13 2011/12 Change

Revenues 2,079 2,115 -2%

Gross Profit 315 369 -15%

Gross Margin 15.2% 17.5%

EBITDA 437 453 -4%

EBITDA Margin 21.0% 21.4%

Adjusted EBITDA 393 424 -7%

Adjusted EBITDA Margin 18.9% 20.0%

11

(1) Tereos Internacional allocates tilling expenses as

cost. If tilling expenses were allocated as investment,

Adjusted EBITDA for fiscal year 2012/13 would have

reached R$494.2 million.


Sugar Ethanol

4

Sugar: 62% of total net revenues

Volumes increased +8.1% to 1.407 million tonnes

Prices down -5.3% Y-o-Y at 919 R$/tonne

Ethanol: 27% of total net revenues

Volume sold (ex-trading) up +5.3% to 506,000 m3

Prices down -9.7% Y-o-Y at 1,121 R$/m3

Cogeneration: R$81.3 million vs. R$44.7 million

Adjusted EBITDA: R$393 million

• Drop driven by negative price effect and cost

inflation (mainly salaries, leasing and

logistics)

• Adjusted EBITDA Margin1 for fiscal year

2012/13 including tilling as depreciation:

23.8%

-86.1% YoY

Sugarcane Indian Ocean/Africa – Production and Financials Another solid year for the Indian Ocean operations

12

Sugarcane Crushing (’000 t) Sugar sales (‘000 t)

-18.2% YoY

Key Figures


Revenues 941 826 +14%

Gross Profit 222 146 +52%


EBITDA 180 151 +19%


Adjusted EBITDA 190 158 +20%


4

2012/13 Revenue Breakdown by Product

Sugar Indian Ocean 40%

Sugar Africa 13%

Trading and others 47%

43 116

1,267

1,176

6

Q4

11/1

2

Q1

12

/13

Q2

12/1

3

Q3

12/1

3

Q4

12/1

3

77

67

76

86

63

Q4

11/1

2

Q1

12

/13

Q2

12/1

3

Q3

12/1

3

Q4

12/1

3

Sugarcane crushing

Indian Ocean: steady performance (-2.7% in sugarcane crushing to 1.84 million tonnes)

Africa: despite unfavorable weather conditions and technical issues negatively impacting irrigation, sugarcane crushing increased 1.9% to 730,000 tonnes

Revenues: +14% Y-o-Y

Favorable commercial conditions in the Indian Ocean and increase in volumes in Mozambique

Adjusted EBITDA: +20% Y-o-Y

Adjusted EBITDA expansion for both operations

210 217 237 215 208

62 60 66

52 81

Q4

11

/12

Q1

12/1

3

Q2

12/1

3

Q3

12/1

3

Q4

12

/13

289 272 277 303

267

134 110 109

72 99

61 70

51

58 51

Q4

11

/12

Q1

12

/13

Q2

12

/13

Q3

12

/13

Q4

12

/13

150

194 180

159

130

433 450 444

412 432

Q4

11

/12

Q1

12/1

3

Q2

12/1

3

Q3

12/1

3

Q4

12

/13

710 723 744 698 698

214 209 224 168 189

Q4

11

/12

Q1

12/1

3

Q2

12/1

3

Q3

12/1

3

Q4

12

/13

887 924 932 968 866

Cereal Segment - Production and Sales Higher volumes in Starch & Sweeteners offset by lower ethanol volumes

13

Cereal Grinding (‘000 t)

Starch & Sweeteners Sales (‘000 t)

-4.0% YoY -0.2% YoY

Co-products Sales (‘000 t)

+6.2% YoY

Alcohol & Ethanol Sales (‘000 m3)

-22.8% YoY

Starch & Sweeteners Ethanol & Alcohol Own Sales Trading Starch & Sweeteners Ethanol & Alcohol

4

Grinding in 2012/13: -1.8% Y-o-Y

Starch & Sweeteners: +0.5% Globally stable

Alcohol & Ethanol: -9.20% Lower ethanol output on reduced utilization rates at Lillebonne due to the start-up of the gluten line

Starch & Sweeteners – Financials Good volumes and increased prices, but not sufficient to compensate for sharp rise in raw

material costs and volatility

Key Figures


Revenues 3,381 2,846 +19%

Gross Profit 625 502 +25%


EBITDA 224 249 -10%




14


Revenues: R$3,381 million, up 19%

Volume increase for starch and sweeteners (+3.5%) and co-products (+2.3%)

More challenging environment for price renegotiation at year-end round

Adjusted EBITDA: R$223 million, down R$22 million

Starch & Sweeteners segment affected by higher raw material costs not fully passed onto customers

Higher energy costs

4

2,846 3,381

+307 +95 +85 +48


1,089

1,239

+118

(65)

+111

(14)


Alcohol & Ethanol Europe – Financials Positive diversification impact delayed due to technical difficulties

Revenues: R$1,239 million, up 14%

Prices: 9.2% for the whole segment

Higher revenues of trading ethanol and co-products making up for lower ethanol volumes

Adjusted EBITDA: R$71 million, down 53%

Increase in the cost of cereal and energy and lower output due to technical difficulties at Lillebonne

15


2012/13 Revenue Breakdown by Product

Key Figures


Revenues 1,239 1,089 +14%

Gross Profit 110 266 -59%


EBITDA 71 151 -53%




4

Ethanol own sales 57% Ethanol

traded 31%

Co-products and other

12%

16

2012/13 Cash Flow Reconciliation Investments in major segments partially funded by the capital increase

Cash Flow

In R$ Million 2012/13

Adjusted EBITDA 869

Working capital variance (61)

Other operating (including income tax paid) (165)

Operating Cash Flow 644

Financial interests (267)

Dividends paid and received (53)

Capex (1,219)

Increase in capital 582

Others 108

Free Cash Flow (205)

Forex impact (177)

Acquisition & Perimeter impact (32)

Net Debt Variation (413)

5

CAPEX

Brazil: 50% of total CAPEX, mainly allocated for:

planting program,

cogen equipment; and

crushing capacity expansion.

c. 2/3rds of the 2015/16 investment program

already invested

Cereals: 40% of total CAPEX, mainly allocated for:

first phase of starch project in Brazil – over 80%

already invested;

capacity expansion in the starch & sweeteners

segment; and

BENP Lillebonne product diversification

Capital Increase

August 2012: R$370 million, 100% subscribed at

Tereos Internacional level to fund the expansion

and geographical diversification of cereal division

October 2012: R$212.2 million, capital injection

from Petrobras Biocombustível at Guarani

Debt Increase mostly due to investment programs and currency effect

Net Debt/Adjusted EBITDA: 4.0x, stable sequentially

Tereos EU syndicated credit facility of €450 million extended by 2 years to June

2017, simplifying the existing structure and covenant requirements

17

Debt

In R$ Million

March 31,

2013

December 31,

2012

March 31,

2012

Change

Y-o-Y

Current 1,896 2,257 1,291 605

Non-current 2,493 2,196 2,384 109

Amortized cost (26) (20) (25) -1

Total Gross Debt 4,363 4,453 3,650 713

In € 1,624 1,812 1,402 222

In USD 1,741 1,793 1,652 89

In R$ 961 783 557 404

Other currencies 63 65 64 -1

Cash and Cash Equivalent (924) (678) (624) -300

Total Net Debt 3,439 3,755 3,026 413

Related Parties Net Debt 31 35 17 14

Total Net Debt + Related Parties 3,470 3,790 3,043 427

5

Sugarcane Brazil : Favorable outlook for sugarcane volumes, and cogeneration sales to double

Expected crushing to be around 20 million tonnes to increase industrial utilization rates and dilute

fixed costs; 2013/14 production mix adjusted more towards ethanol (36% to ~40%)

Planting program for 2013/14: 2/3rds performed of the 30,000 hectares expected

Guarani 2015/16 Program: Focus on improving industrial/agricultural efficiency, energy savings and

cost/G&A reduction to offset inflation

Despite low sugar prices, 40% of Guarani sugar sales hedging target already secured at 20.6 USD

cents/lb (as at 31st March, 2013)

Positive measures from Government supportive of ethanol prices (higher gasoline prices, anhydrous

blending back to 25% and federal tax incentives - PIS/COFINS elimination)

Cereals: Diversification in Europe and starch project in Brazil to be fully operational in 2013/14

Beginning of Brazilian corn plant production and progressive improvement expected in Lillebonne

Margins to remain under pressure in H1 2013/14 due to Lillebonne progressive ramp up and delayed

impact of hedging position

Sales growth expected for cereal division backed by improvement in mix, stable volumes and higher

perimeter

Extended partnership with Wilmar to enhance raw material diversification and market penetration in

China - approval expected in H2

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Outlook

6

Tereos apresentacao 4_t12_2013_eng

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