Meeting with Meeting with InvestorsInvestorsInvestorsInvestors
Forward-looking Statements
This presentation contains forward-looking statements. These statements are not
historical facts and are based on management’s objectives and estimates. The
words "anticipate", "believe", "expect", "estimate", "intend", "plan", "project",
"aim" and similar words indicate forward-looking statements. Although we believe
they are based on reasonable assumptions, these statements are based on the
information currently available to management and are subject to a number of
risks and uncertainties.
2
risks and uncertainties.
The forward-looking statements in this presentation are valid only on the date
they are made (June 30, 2010) and the Company does not assume any obligation
to update them in light of new information or future developments.
Braskem is not responsible for any transaction or investment decision taken based
on the information in this presentation.
Agenda
� Braskem
� A global player
� Acquisitions: opportunities and challenges
� Project pipeline: growth with value creation
� Braskem consolidated
3
� The petrochemical industry
� Final considerations
Agenda
� Braskem
� A global player
� Acquisitions: opportunities and challenges
� Project pipeline: growth with value creation
� Braskem consolidated
4
� The petrochemical industry
� Final considerations
Braskem overview
Industrial Assets
� Leading thermoplastic company in the Americas
� Diversified portfolio of petrochemical products, with focus on PE, PP and PVC
� Annual capacity of 6,460 kton
� 31 facilities in Brazil and USA
� Naphtha and gas based crackers
� 3 PP
� 1 PVC� 1 Chlorine-soda
5
� 1 gas cracker� 1 PP� 1 PE
� 1 naphtha cracker� 2 PP� 3 PE
Source: Braskem
� Naphtha and gas based crackers
� Petrobras as the main supplier in Brazil
� Attractive project pipeline in Latin America
� Listed in 3 stock exchanges: BM&FBovespa, NYSE and Latibex
� 100% tag along
� Key Financials LTM 2Q10
� Net Revenue: R$ 24.8 billion
� EBITDA: R$ 3.8 billion
� 1 naphtha cracker� 1 ethanol cracker� 5 PE� 2 PP
� 1 naphtha cracker� 4 PE� 1 PP� 1 PVC�1 Chlorine-soda
2020
Polialden
Ipiranga, Copesul and Paulínia
Petroquímica Triunfo
Track record of success with clear objectives
Acquisitions Quattor + Sunoco
Leader in Latin America
Leader in the Americas
2010Politeno
54% capacity increase
80% capacity increase
Acquisitions
Organic Growth
Resins Capacity (kton/y)
1,821
520
2,341
2,185
1,410
3,595
2,185
4,275
6,460
20022006
2007
Polialden
6
2.76x2.76x 2,89x2,89x 3.23x3.23x
Net Debt/EBITDA (US$)
2.98x2.98x
Aft
er
R$
3.7
4 b
i c
ap
ita
l in
cre
as
e and d
isb
urs
em
en
t o
f Q
ua
tto
r a
nd
Su
no
co
a
cq
uis
itio
ns
2006
20032004
2005
20082009
2010OPP Trikem
Politeno
2.84x2.84x2Q10
Source: Braskem
Leader in the Americas and a top 8 global player in resins capacity
4th
1st
Ca
pa
city
in th
e A
me
rica
s (
kt/
y)
3,035
4,077 4,200
2,525 1,995 2,311
2,915 1,230 627
1,731
1,090
822 875
510
510
1,210
2,340
PVC
PP
6,460
4,827
3,595
4,256
3,082
2,340 2,3111,915
5,307
950
Lyondell Basell
ExxonMobil
SINOPEC Dow Formosa SABIC Ineos Braskem post
operations
Total IPIC Reliance PetroChina Braskem
10,914
9,3118,668
7,749 7,284 7,1096,541 6,460
4,681 4,564 4,303 4,079 3,595
transactions 7
8th
12th
Ca
pa
city
in th
e A
me
rica
s (
World
Ca
pa
city
(kt/
y)
Braskem post
transactions
Exxon Mobil
Dow Lyondell Basell
Braskem Formosa Shintech Chevron Philips
Quattor Sunoco
2,525 1,995
1,050
2,311
1,040 950
2,340 PP
PE
1,626
1,337
1,642
2,132
Consistent growth
CAGR: 21%
EBITDA 1 (US$ million)
10,212CAGR: 19%
Nominal Capacity (kton)
Resins
Ethylene
19.1%19.3%
23.1%
18.0%
14.1%
16.9%
13.5%
14.4%15.5%
2002 2003 2004 2005 2006 2007 2008 2009 LTM
2010
457 581
871 851 764
1,337
EV/
EBITDA
EV
(US$ bi)
8
Source: Braskem 1 Pro-forma figures for 2009 and 1Q10: Braskem + Quattor + Sunoco
2.4 3.9 5.8 4.2 4.7 7.6 5.1 7.5 13.4
5.2x 6.7x 6.6x 5.0x 6.2x 4.6x 3.8x 4.8x 6.3x
2002 2003 2004 2005 2006 2007 2008 2009
2,965 3,045 3,145 3,190 3,621
5,5515,921
Supported by higher production, market leadership, successful sales policies and industry consolidation
8
Agenda
� Braskem
� A global player
� Acquisitions: opportunities and challenges
� Project pipeline: growth with value creation
� Braskem consolidated
9
� The petrochemical industry
� Final considerations
Quattor acquisition
Camaçari
MauáPaulínia
Duque de Caxias
PP HOMO/COPO (1979)Capacity: 115 ktyTechnology: Slurry Shell
Bah
ia Opportunities
� Asset concentration in Southeast (~70% Brazilian resin consumption);
� Optimization of logistics distribution related to reduction in external storage;
� Diversified RM matrix – balance between naphtha-natural gas;
� Joint administration of raw material agreements;
� Renegotiation of service and insurance
Cracker (2005)Capacity: 520 kty ethyleneTechnology: ABB Lummus –
ethane/propane
HDPE/LLDPE (2005)Capacity: 540 kty
Rio
de J
an
eir
o
10
Cracker (1972)Capacity: 700 kty ethylene*Technology: ABB Lummus
(naphtha)
LDPE/ EVA (1972)Capacity: 120 ktyTechnology: HP Autoclave
HDPE/ LDPE (2008)Capacity: 240 kty Technology: Slurry – Chevron Phillips
LDPE (1965)Capacity: 140 kty Technology: Tubular
PP HOMO/COPO (2003)Capacity: 450 ktyTechnology: Spheripol
São
Pau
lo
Triunfo
Paulínia Caxias
*200 kty expansion effectively coming online in 2010
� Renegotiation of service and insurance contracts;
� Unification of production and maintenance practices;
� Unification of Technology and Innovation centers;
� Reduction of working capital costs;
� Tax and logistical synergies;
� Organizational restructuring.
Challenges
� Stability of raw material supplies;
� Integration of cultures.
Capacity: 540 kty Technology: Gas phase - Unipol
Rio
de J
an
eir
o
PP HOMO/COPO (1992)Capacity: 310 ktyTechnology: Bulk – Lipp
Acquisition disbursement: R$647.3 million
Quattor - key indicators
R$ million 1Q10 2Q10
Net Revenue 1,220 1,425
Operating rate (%) 1Q10 2Q10
Ethylene 71%(1) 83%(1)
PE 61% 76%
Operational Indicators
Financial Indicators
11
Net Revenue 1,220 1,425
EBITDA 107 214
EBITDA Margin 8.8% 15.0%
Main impact on operational profit in 2Q10
� Increase in operating rates with better stability of raw material supply: supply from Mauácomplex normalized in May 2010
(1) Considering the 200 kty expansion
Outlook as of 2H10
� Cabiúnas and Reduc refineries normalized operation enabled Riopol to have the best monthly operating rates in July: 86% for ethylene and 77% for PE;
� Petrobras’ commitment to normalize supply to enable Riopol to operate at full capacity by October 2010.
400
79
43
Quattor synergies of R$ 400(a) million in EBITDA as of 2012R$ million
� Investment of R$ 350 million required to capture all
279
Industrial Logistics Supply EBITDA Synergies
12
� Production mix
� Seizing the cracker streams
�Optimization of inventories
�Maximization of gains from product distribution (domestic and export markets)
�Optimization of modes
� Joint management of feedstock purchases
� Renegotiation of third-party agreements
required to capture all synergies
� Financial synergy NPV estimated in R$ 340 million
(a) RecurringSource: Braskem
Braskem America (former Sunoco)
Marcus Hook, PA� 1 PP
R&T Center
Pittsburgh, PA
Neal, WV� 1 PP
Opportunities
� Global-scale, state-of-the-art assets –technology and age similar to Brazil’s polypropylene (PP) assets;
� Development of a global production base;
� Consolidation of industrial assets;
� Competitive costs for some 70% of raw materials;
13
La Porte, TX� 1 PP
materials;
� Platform for greenfield projects in Latin America.
Challenges
� Knowledge of North American distribution market;
� Add value to supplier ⇔ client chain (substitute distributor);
� Highly disperse market;
� Resumption in demand vs. uncertainty of economic recovery.
R$ million 1H09 1H10
Net Revenue 764 1,109
EBITDA 88 106
Financial Indicators
Acquisition disbursement: US$350 million
Agenda
� Braskem
� A global player
� Acquisitions: opportunities and challenges
� Project pipeline: growth with value creation
� Braskem consolidated
14
� The petrochemical industry
� Final considerations
“BECOME THE GLOBAL
SUSTAINABLE CHEMICAL
LEADER, INNOVATING FOR
Strategic Direction
LEADER, INNOVATING FOR
BETTER SERVE THE
PEOPLE”.
15
Green Polyethylene
� First Green Plastic Certified in the World� Location: Triunfo – RS
� Capacity: 200 Kton/y
� Startup: September 2010
� Investment: R$ 488 million
� Consumption of 460,000 m³ of ethanol per year
� 75% of the ethanol supply is already contracted
� Demand 3x higher than the installed capacity
POLYETHYLENE
� Main Clients and Partners� Demand 3x higher than the installed capacity
����Partnership in R&D – Renewable Polymers
���� Green PE trading in Asia
16
BRAZIL
Expansion with increased competitiveness
PVC Expansion
Operational start-up : 1st half 2012
• Expansion of 200 kton/y in PVC capacity in Alagoas
• Investments of US$470 million
• Expected NPV ~US$450 million
• Disbursements already in 2Q10
• Support for Brazil’s infrastructure projects
17Source: Braskem
Industrial Assets
New Projects
Projects with Petrobras
• Support for Brazil’s infrastructure projects
• Braskem participation in Suape Project (textile
complex) and Comperj (1st and 2nd Generation)
under analysis.
Comperj and Suape
LATIN AMERICA
Expansion with increased competitiveness
Mexico: Ethylene XXI Project
Operational start-up: early 2015
• JV between Braskem (65%) and the Mexican group IDESA (35%) for the purchase of ethane from PEMEX
• Integrated project: 1 Mty of ethylene and 1 Mty of PE
• Investment estimated at up to US$2.5 billion over 5 years (project finance)
18
years (project finance)
• Financial Advisor hired: Sumitomo Bank
• Structuring of the participation of ECAs and MLAs1
Industrial Assets
New Projects
Projects with Petrobras
Source: Braskem 1 Export Credit Agencie (ECA) and Multilateral Agencie (MLA)
� Currently deficit above 1.1 MM ton (2010)
� Estimated deficit in 2015 (project start-up): 1.7 MM ton
� Annual Growing rate foreseen: 4.5 % (Period: 2010-2025 )
Mexican Polyethylene Market
3.1 3.2 3.3 3.4 3.5
3.5
4.0
Polyethylene Mexican Market
0.4 0.5 0.5 0.5 0.6 0.7 0.7 0.8 0.8 0.8 0.8 0.8 0.8 0.8 0.8 0.8 0.8 0.8 0.8 0.8 0.8 0.8
1.1 1.1 1.1 1.2 1.1 1.0 1.1 1.1 1.3 1.4 1.5 1.7 1.8 1.9 2.0 2.1 2.2 2.3 2.4 2.5 2.6 2.7
1.5 1.6 1.7 1.7 1.6 1.7 1.8 1.9
2.0 2.2
2.3 2.5 2.6 2.7 2.8 2.9 3.0 3.1 3.2
-
0.5
1.0
1.5
2.0
2.5
3.0
3.5
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025
MM
ton
/ye
ar
Supply Deficit Demand
19
Converters Profile
Mexican Converters Industry
� 3,500 plastics converters
� 84% small and micro companies
� More than 5 MM ton of plastics conversion, with 1.8 MM of Polyethylene
� Main application: Packaging (48% market)
� Sales to distributors: Braskem ≠ Pemex
Micros
60%
Pequenas
24%
Médias
12%
Grandes
4%
Big
Medium
Small
Converters Profile
Total: 3,500 ConvertersTotal: 3,500 Converters
20
Consolidated project pipeline
� Green PE(+ 200 kty ethylene)
� Ethylene XXI - Mexico(+ 1,000 kty ethylene and + 1,000 kty PE)
� Propilsur – Venezuela
� PeruProj. (+ 600 to 1,000 kty ethylene/PE)
� Polimerica – Venezuela(+ 1,300 kty ethylene and + 1,000 kty PE)
� Suape
21
� Resin Capacity CAGR for 2010-2015: +4.3% p.y.
� Diversification of raw materials and world-class assets
� Fiscal discipline
� Excellent track record of projects execution
2010 - 2012 2013 - 2015 Projects under evaluation
(+ 200 kty ethylene)
� PVC Expansion (+ 200 kty)
� Propilsur – Venezuela(+ 300 kty PP)
� Suape
� Comperj
Source: Braskem
Investments in 2010 amount to R$1.6 bi
InvestmentsR$ million
10
360
3556
Quattor
Quantiq
VenezuelaBraskem America
1,617
22
Industrial Assets
New Projects
Projects with Petrobras
Source: Braskem
44
20821
61
101
317
8
52
63
192
251
254
7
7210
1197
1S10 2010e
Quantiq
Equipment Replacement
Capacity Increase / PVC Alagoas
Maintenance
Mexico
Others
Productivity
Green PE
621
Agenda
� Braskem
� A global player
� Acquisitions: opportunities and challenges
� Project pipeline: growth with value creation
� Braskem consolidated
23
� The petrochemical industry
� Final considerations
Braskem consolidated
2009 LTM Jun/10
R$ billion Consolidated Consolidated
Net Revenue 21.5 24.8
EBITDA 3.2 3.8
Net Debt/EBITDA 3.46x 2.84x
# Plants: 29 29
Financial Indicators:
Potential for margin gains
�Stabilization in raw material supplies;
�Margin equalization Braskem (17%) vs. Quattor(12%) in 1H10;
�Substitution of 1H09 by 1H10
1,995
3,035
1,090
1,965
510
510
PVC
PP
PE
24Source: Braskem
3,595
6,46080% Capacity
Increase
Listed on three stock exchanges: BM&FBovespa, NYSE and Latibex
Industrial Assets
# Plants: 29 29
Raw material matrixDiversification to compete globallyRaw Material Profile* (2009)
13%
18%
69%
24%
15%58%
3%
Braskem Post-Acquisitions* Braskem Post-Projects*
Implementation of Project Pipeline**
46%
14%
92%17%
56%
8%
37% 30%
25
�More balanced and diversified supply of raw materials
�Competitive natural gas price vs. international reference prices
(1) Ethane, Propane and HLR; (2) Naphtha and condensate*Based on resin-production capacity. Sunoco buys propane directly** Considering the Mexico Project and Green PE
Propane
�USGC reference to competitive prices
Natural Gas
� 100% Petrobras supply with competitive prices versus international prices
Ethanol
Naphtha / Condensate
� ~70% of naphtha supplied by Petrobras with competitive price formula
� 30% direct imports from various international suppliers
Quattor Sunoco Braskem
Liquid (2) Refinery propylene Gas (1)
Ethanol
Strong cash generation and competitive margins
Key Indicators2Q10
(A)
1Q10
(B)
2Q09
(C)
Change
(A)/(B)
Change
(A)/(C)
Net Revenue 6,539 6,272 4,996 4% 31%
EBITDA 1,042 909 735 15% 42%
EBITDA Margin 15.9% 14.5% 14.7% 1.4 p.p. 1.2 p.p.
R$ million
� Strong cash generation mainly due to the improvement on Quattoroperational performance
� Productivity gains already reflecting on 2nd quarter
Financial Result2Q10
(A)
1Q10
(B)
2Q09
(C)
Change
(A)/(B)
Change
(A)/(C)
Net Financial Result (575) (880) 1,379 -35% -142%
Foreign Exchange (FX) and Monetary Variation (MV) (216) (374) 1,666 -42% -113%
Financial Result excluding FX and MV (359) (506) (287) -29% 25%
Interest Expenses / Revenues Net (165) (129) (153) 28% 8%
Tax Assets and Liabilities (40) (287) (30) -86% 34%
Others (155) (90) (105) 71% 47%
26Source: Braskem
reflecting on 2 quarter result
� Focus on capturing synergies
� Significant improvement on results after financial crisis
Demand stability in 2Q10 reflects sectors good performance
Apparent Consumption (Kton)
4,048 4,173 4,2914,720
+10%
1H10
27Source: Abiquim, Braskem estimates, Tendência Report, IBGE, Anfavea
Food
Retail
Hygiene and Cleaning
Agribusiness
Consumer Goods
Construction
Automotive
Electric and Electronic
Relevant
Moderate
Low / Retraction
Domestic demand performance
by sector:
2007 2008 2009 2010e
Historical Prices
PE prices evolution (100 basis) PP prices evolution ( 100 basis)
80
90
100
110
120
130
apr/09 09
aug/09
oct/09
dec/09
feb/10
apr/10 10
aug/10
80
90
100
110
120
130
140
apr/09 09
aug/09
oct/09
dec/09
feb/10
apr/10 10
aug/10
28
International Market Brazilian Market International Market Brazilian Market
� Resins prices show signs of recovery in the international market
� Recovery expected already in August
Source: CMAI
apr/09
Jun-09
aug/09
oct/09
dec/09
feb/10
apr/10
Jun-10
aug/10
apr/09
Jun-09
aug/09
oct/09
dec/09
feb/10
apr/10
Jun-10
aug/10
Market trend
Braskem consolidated sales evolution of Braskem consolidated sales evolution of thermoplastic resins thermoplastic resins (1)(1) –– Brazilian marketBrazilian market
3Q10 trend in the Brazilian market3Q10 trend in the Brazilian market
Volume Price Revenue Cost
PP
PE
Resins sales evolution (kton)
1Q09 2Q09 3Q09 4Q09 1Q10 2Q10
29
PE
PVC
Resins sales evolution (kton)
Source: Braskem estimates and ABIQUIM. (1) 2009 and 1Q10 pro forma data.
Leverage ratio falls below 3x for the first time since the acquisition
In R$ million (06/30/10)
Gross Debt: 14,384
Net Debt: 10,909
Average Term: 8.2 years
64% of debt is pegged to USD
* After capital increase of R$3.74 bi anddisbursement of Quattor and Sunoco acquisitions3,475
3.12x2.84x
Mar 10 Jun 10
Net Debt / EBITDA
(million of R$)
-9%3.23x
2.84x
Mar 10 Jun 10
Net Debt / EBITDA
(million of US$)
-12%
30Source: Braskem
disbursement of Quattor and Sunoco acquisitions
2014
2.278
584
1.8891.731
2.346 2.346
1.296 1.299 1.3151.631
1.197
2010 2011 2012 2013 2015 2016/
2017
2018/
20192020
onwards06/30/10
Cash
4%
13%12%
16%
9% 9%
12%
Invested in US$
Invested in R$
16%
9%
-
BB+
BB
BB-
stable
RATINGRATING
Ba1
Ba2
Ba3
-
+BBB-Ba3
Jan/09
Mar/09
+May/09
Jan&Feb/10
Post-Acquisitions
Braskem: Ratings confirmed after acquisition
Investment Grade
The acquisitions:‣ Strengthened strategic positioning;‣ Increased # of plants, sites and geographic diversification;
Upgrade Conditions:‣ Maintenance of high liquidity (cash or equivalents - stand-by) above R$3 billion. Cash above R$3 billion sinceDec/2008.‣ Capitalization of Braskem as pre-condition for acquisition.Shareholder movements;‣ Successful integration with capture of synergies andincrease in cash generation;‣ Decrease in Net Debt/EBITDA ratio expected to 2.5x. Infirst post-acquisition quarter we already reduced this ratiofrom 3.46x to 3.12x. In 2Q10 we reduced to 2.84x.
Source: Braskem
Braskem Ratings (National Scale) Braskem Ratings (Global Scale)
S&P AA+ / Stable Outlook
Moody’s Aa2.br / Stable Outlook
Fitch AA / Stable Outlook
S&P BB+ / Stable Outlook
Moody’s Ba1 / Stable Outlook
Fitch BB+ / Stable Outlook
BB-
B+
Ba3
B1
2009 2010
‣ Increased # of plants, sites and geographic diversification;‣ Diversification of raw material mix;‣ More disciplined and less volatile domestic market ;‣ High governance standards;‣ Petrobras participation.
from 3.46x to 3.12x. In 2Q10 we reduced to 2.84x.
31
Agenda
� Braskem
� A global player
� Acquisitions: opportunities and challenges
� Project pipeline: growth with value creation
� Braskem consolidated
32
� Final considerations
� The petrochemical industry
Outlook on the global petrochemical industryEthylene: Operating rate 1H10
Industry at 1H2010
� Producers already responded to the demand slowdown in 2Q10 by reducing the operating rates
� Competitive cost base allows the US to operate at higher rates than other regions
� Braskem back to operate at a rate above world average in 2Q10
79
8683
7781
89
0
5,000
10,000
15,000
20,000
Europe N. America Asia M. East World Braskem
Capacity 2Q Operating rate 2Q10 (%)
000 ton
84
90 89
8286
84
33Source: CMAI
above world average in 2Q10
Global Scenario
� New capacity additions can lead to the closing down of non competitive assets on a permanent basis, especially in Europe and US
� Global economic outlook volatility versus petrochemicals demand
� Expectation of improvement in the industry profitability as of 2H11
Ethylene: Supply and Demand Balance
000 ton
83.880.4
83.1
87.0 88.490.5
0
50,000
100,000
150,000
200,000
2009 2010e 2011e 2012e 2013e 2014e
Capacity Demand Operating Rate 2010e (%)
Capacity 2Q Operating rate 2Q10 (%)
Operating rate 1Q10 (%)
2010 Ethylene capacity additions
Region CompanyAdditional
Capacity 2010Start up
Effective Capacity 2010*
Middle East Morvarid PC 334 2Q10 208
Middle East RLOC 975 2Q10 / 3Q10 650
Middle East Kayan 300 4Q10 300
Middle East Petro-Rabigh 325 1Q10 325
Middle East SHARQ 1,100 2Q10 800
Middle East Yansab 433 1Q10 108
Middle East Borouge 700 3Q10 650
Asia Baotou Shenhua 100 3Q10 100
Asia CNOOC & Shell PC 150 2Q10 150
� New players are located in Middle East (38%) and Asia (59%)
� Feedstock matrix of the new capacities:51% naphtha and 49% gas
� Delays already reduced in 18% the start up of new
34
Asia CNOOC & Shell PC 150 2Q10 150
Asia Dushanzi PC 667 2009 667
Asia Fujian Ref & Chem 533 2009 533
Asia Panjin Ethylene 450 2Q10 305
Asia Secco 150 2009 150
Asia Shenyang Paraffin 87 2009 87
Asia SINOPEC/SABIC Tianjin PC 1,000 1Q10 / 3Q10 750
Asia ZRCC 750 2Q10 750
Asia JX Nippon Oil & Energy Corp. 220 3Q10 220
Asia LG Chem 75 2009 75
Asia YNCC 33 2009 33
Asia Shell Chemical 667 2Q10 667
Asia MOC 675 2Q10 675
Asia PTT Polyethylene 917 3Q10 500
Others 275 275
TOTAL 10,916 8,978
Source: CMAI / Parpinelli / Braskem Analysis
-18%
18% the start up of new capacity for the year
� A demand growth of 4.5 million tons of ethylene is expected in 2010, up by 4% compared to 2009
� Delays and learning curve from the commissioned plants shall positively impact the 2010 supply/demand balance
* Estimated data. Does not consider the plants operating rates and possible additional delays.
Brazil’s macroeconomic outlook
Annual real GDP growth
• Brazil’s economy is still relatively closed, with exportscorresponding to 14% of GDP, distributed amongvarious trade partners.
• Strong external solvency ratings and floating exchangerate system curbed speculation against the BRL duringthe crisis.
• Brazil’s banking system is well capitalized and highlyregulated.
4,5%
3,5%
4,7%
6,1%
1,3%
-0,2%-0,2%
7,8%
4,5% 4,5% 4,6%
4,4% 4,3% 4,3%5,2%
-1,0%
0,0%
1,0%
2,0%
3,0%
4,0%
5,0%
6,0%
7,0%
8,0%
9,0%
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
35
Average monthly income (March 2002 = base 100)
regulated.
• Household consumption corresponds to 61% of GDP,while government consumption corresponds to 20%.GDP is highly influenced by consumer behavior, whichhas been driven by growth in average income levels.
• Brazil is still an unleveraged economy, but withgrowing access to credit (the ratio of available creditto GDP is currently 45% and is expected to increase to49% in 2010), which ultimately spurs consumption.
Real GDP On August 2010 On December 2009
Source: Santander
80
100
120
140
160
180
Rendimento MédioAverage Income
63
57
Brazil: Dynamic MarketStill-low per-capita consumption
Per-capita consumption of PE, PP and PVC (kg/person)
Brazil:
63
57
41
1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
PE PP PVC
11.1
16.616.215.414.513.612.5
22.221.920.2
18.018.717.517.816.1
22.7
9.6
41
28
* Compound annual growth rate 36Source: CMAI, IBGE, Abiquim, Braskem
Brazil:
5.4%CAGR
22.2
41
28
13%
9%3%
6%
Consumer driven Braskem’s domestic sales breakdown in 1H10
CONSUMER GOODS AUTOMOTIVE
HYGIENE AND CLEANINGCOSMETICS AND PHARMACEUTICALS
4%
28%
6%14%
3%4%
4%
5%2%
Source: Braskem / Abiquim 37
FOOD PACKAGING
RETAIL
CONSTRUCTION
AGRIBUSINESS
ELECTRIC AND ELECTRONIC
INDUSTRIAL
CHEMICALS AND AGROCHEMICALS
OTHERS
INFRASTRUCTURE
Market development
BUBBLEDECK
Construction of light slabs using polypropylene spheres.
Project developed with Unipac and Toyota-Tsusho. Flooring that allows water permeability.
Substitutes concrete wells for a rotation-molded structure. Support from CNO and partners Asperbras, Fortlev and Brinquedos Bandeirante
Agro-machinery
Parts for tractors, harvesters and tools migrating to PE rotational molding.
38
CROSSWAVE
TRAVELING BLOCK
New washer molds, with PP cabinets (replacing steel) in final validation stage.
Substitution of asbestos by PP fibers with fiber-cement reinforcement.
FIBER-CEMENT
Manholes
Large Tanks
Substitution of fiberglass tanks for volumes greater than 2,000 l.
Plastic silos for grain storage. Partnership with Suzuki.
Silo Bags
Agenda
� Braskem
� A global player
� Acquisitions: opportunities and challenges
� Project pipeline: growth with value creation
� Braskem consolidated
39
� Final considerations
� The petrochemical industry
0
5
10
15
20
25
30
35
jan-02 jan-03 jan-04 jan-05 jan-06 jan-07 jan-08 jan-09 jan-10
Pr/share BRKM5 Performance
+
Why Braskem?
Consolidated (R$ billion) 2Q10 Multiple
EBITDA LTM 3.8 3.8
Synergies to 2012 4.2
Market Capitalization 13.3 18.8
EV 24.2 29.7
EV/EBITDA 6.3x 7.0x**
Price per share 16.6* 23.6
Proj. NPV to 2012 > R$1.12 bi
Value added by projects to jan-02 jan-03 jan-04 jan-05 jan-06 jan-07 jan-08 jan-09 jan-10
R$ US$
� Largest thermoplastic resin producer in the Americas
� Leader of important projects in Latin America with
competitive raw materials
� Emerging consumer market with potential per-capita growth
as additional driver
� Above-peer profitability
� Access to one of the world’s largest consumer markets
following the U.S. acquisition
� Successful trajectory of organic growth and acquisitions
� Shareholders hold long-term view with strategic synergies
for growth and value creation
� Leader in green chemicals
� Huge potential for value creation
� EBITDA increase
� EV/EBITDA multiple below
peers’ multiple (6-7x)
40
*BRKM5 as of 9/29/10 ** Peer Multiple 2010.
Source: Bloomberg.
Value added by projects to
share price 1.40
Meeting with Meeting with InvestorsInvestorsInvestorsInvestors
AppendixAppendixAppendixAppendix
125130 133
143 146 146151 154
114 111 111 115121
127133
140
Global Ethylene supply/demand
Global ethylene supply / demand (Mton/y)
2007 2008 2009 2010 2011 2012 2013 2014
Supply
Demand
43Source: CMAI, June 2010 * Not considering additional delays and shutdowns
78 79 83 90 92 93 97 99
49 51 5560 64 64 66 68
41 44 4547 49 51 51 52
PVC
PP
PE
168
215209205198182173
219
Global Resins supply/demand
Global Resins (PE, PP, PVC) Supply (Mton/y)
2007 2008 2009 2010 2011 2012 2013 2014
69 66 67 71 75 79 83 88
44 43 44 47 50 53 57 6035 32 32 34 37 39 41 43
PVC
PP
PE
149
181172161
152143141
191
2007 2008 2009 2010 2011 2012 2013 2014
4444Source: CMAI, June 2010
Global Resins (PE, PP, PVC) Demand (Mton/y)
Resins demand by region
2010 Resins (PE, PP, PVC) Demand by region
Africa
3%
Europe
18%
China
27%
45Source: CMAI, June 2010
North America
17%
South America
6%Middle East
6%
Asia ex-China
23%
The Brazilian demand for resins represents 3% of global demand
Ownership Structure Leveraging relationship with Petrobras
(1) Does not include shares held in treasury
% Capital Votante % Capital Total
Petrobras*47,0% 35,8%
Outros (1)
2,9% 20,2%
Odebrecht*50,1 % 38,3%
BNDESPAR0,0% 5,5%
46Source: Braskem, as of August 31, 2010.
• Potential for operational synergies with refineries and partnership with Petrobras R&D Center
• Alliance to strengthen Brazil’s petrochemical value chain
– Access to competitive raw materials
– Improved value chain competitiveness
• Corporate governance standards: Shareholders’ agreement
Leveraging relationship with Petrobras: NOC alliance
Corporate Governance post acquisition
� Odebrecht as the controlling shareholder, with all results fully consolidated,reinforcing Braskem’s condition as a publicly traded private company;
� Braskem executives entrusted with the Company’s management and business plan,approved by a simple majority of the Board of Directors;
� Sharing of strategic decisions, with consensus approval by Board of Directors, includingfor:– divestments greater than 10% of long-term assets– acquisitions greater than 30% of long-term assets
� Board of Directors with 11 members, out of which 1 is independent:� Board of Directors with 11 members, out of which 1 is independent:– Odebrecht nominates Chairman of the Board, CEO and CFO– Petrobras nominates Vice Chairman of the Board, the Chief Investments and Portfolio
Officers
� Investment decisions based on objective criteria for returns and profitability, such asproject IRR and NPV.
� Clear financial policy that stipulates the strict conditions, with derivatives used solelyfor hedging;
� Being the sole vehicle for petrochemicals investments gives Braskem the right to:
- Act as the leader for all investments identified by Petrobras that are of interest toBraskem;
- If not interested, the right to sell the products.47
92%84% 89%
81% 76% 83% 83% 79% 81%95% 98%
87%
Ethylene Polyethylene Polypropylene PVC
Increase in Quattor capacity operating rate positively impacted 2Q10
Braskem consolidated operating rate %%
**
2Q09 1Q10 2Q10 2Q09 1Q10 2Q10 2Q09 1Q10 2Q10 2Q09 1Q10 2Q10
48
� Quattor better performance:
� 12 pp growth in ethylene operating rate – 83% in 2Q10 versus 71% in 1Q10
� 15 pp growth in PE operating rate – 76% in 2Q10 versus 61% in 1Q10
� Crackers and 2nd generation plants, in general, show recovery of operating level in 2Q10
� Scheduled shutdown in Camaçari affected PVC operating rate in 2Q10
* 2009 data does not include the 200 kton expansion in QuattorSource: Braskem
World indicative ethylene cash costs
49Source: CMAI
Revenues breakdown – 2Q10
BTX* 8%
Cumene 3%
ETBE 2%
Fuel 4%Others 7%
Net Revenue by Product(1)
(2Q10)
50Source: Braskem
Resins 62%
Ethylene 5%
Propylene 4%
Butadiene 4%
BTX* 8%
1 Does not include nafta/ condensate/crude oil processing and QuantiQ sales
* Benzene, Toluene, Paraxylene and Orthoxylene
COGS breakdown – 2Q10
Other Variable
Costs 6.9%
Labor 3.5%
Services 1.7%
Others 1.0% Deprec / Amort
6.3%
COGS 2Q10 (1)
51Source: Braskem
Naphtha 56.6%
Gas 16.8%
Electric Energy
4.6%
Natural Gas 2.5%
Costs 6.9%
1 Does not include naphtha / condensate / crude oil processing and costs of
Quantiq
Exports Destination – 2Q10
North
America 44%
Europe 16%
Asia 6% Others 1%
Exports Destination (2Q10)
52Source: Braskem
America 44%
Central
America 6%
South
America 27%
The Export Market represents 32% of Company’s Net Revenue.
213
(5) (12) (20) (43)
1,042
FX Impact
on Revenue
FX Impact on
Costs
-38
26
R$ million
EBITDA Trends 1Q10 Pro Forma vs. 2Q10
The better domestic prices through May, following the
international market, offset the higher raw material prices in
2Q10
909
(12) (20) (43)
EBITDA1Q10
ContributionMargin
Volume FX Fixed Costs +SG&A
Others EBITDA2Q10
53Source: Braskem
Outstanding Bonds & Outstanding Ratings
Outstanding BondsOutstanding Bonds MaturityMaturityCoupon Coupon
(% p.a.)(% p.a.)
Yield * Yield *
(% p.a.) (% p.a.)
US$250 MM Jan/2014 11.750 3.8
US$250 MM Jun/2015 9.375 4.6
US$275 MM Jan/2017 8.000 5.6
US$500 MM Jun/2018 7.250 5.9
US$750 MM May/2020 7.000 6.0
US$150 MM Perpetual 9.750 9.5
54
US$150 MM Perpetual 9.750 9.5
US$200 MM Perpetual 9.000 8.9
US$450 MM Perpetual 7.375 7.4
AgencyAgency RatingRating OutlookOutlook Reviewed inReviewed in
Fitch Ratings BB+ Stable 03/02/2009
S&P BB+ Stable 05/28/2009
Moody’s Ba1 Stable 05/21/2009
Corporate Credit Rating Corporate Credit Rating –– Global ScaleGlobal Scale
* As of September, 30th
Source: Braskem / Bloomberg
Covenants
Net Debt / EBITDA
< 4.5X2.84
Jun 10
Net Debt / Ebitda (x)Net Debt / Ebitda (x)
2.84
Jun 10
RATIORATIO
R$R$US$US$
55
FacilityFacility Amount*Amount* Jun 10Jun 10 CurrencyCurrency TypeType
2010 and 2011 2010 and 2011 DebenturesDebentures
R$800 MM R$500 MM R$ Incurrence*
2014 Medium Term 2014 Medium Term NotesNotes
US$250 MM R$250 MM R$ Incurrence*
Nippon Export and Nippon Export and Investment InsuranceInvestment Insurance
US$80 MM US$49 MM US$ Maintenance
EPP (Export PreEPP (Export Pre--Payment) Payment)
US$725 MM US$625 MM US$ Maintenance
*The company is prevented from issuing any new debt for the period if it overcomes
the 4.5x Net debt / Ebitda ratio.
Source: Braskem
Applied Innovation and technology to strengthen value chain competitiveness
Focus on product and application development
� 18% of resin sales derive from products developed in the last three years
� Focus on clients’ end users
Structured resource base to support client needs
� Over US$ 330 million in R&D assets
� More than 190 researchers
� 8 pilot plants
� More than 260 patents filed worldwide
� Partnership with universities and R&D centers in
56
56
users
Targeted initiatives for breakthrough technology
� Intelligent packaging
� Renewable products
Source: Braskem
� Partnership with universities and R&D centers in
Brazil and abroad
Sustainable Development:
A way of doing businesses to satisfy all stakeholders, today and in the future
Results
Sustainable development
ResponsibeResponsibe
CareCare
2002 Public Commitment
2005, 2006, 2007, 2008, 2009
ISO 14.001*
OHSAS 18.001**
Acknowledgements
57
Effluents(m3/t)
2.712002
1.232009
-54%
Brazil CI: 2.8
Water Consumption(m3/t)
5.492002
4.022009
-27%
World CI: 27.8
Total Recordable Cases Accidents Rate(employees and contractors – 1.000.000 mh)
5.122002
0.882009
-83%
Strong Improvement since 2002
Health, Safety and Environmental Results
2008 Brazilian Chemical Industry data (Abiquim 2009)2007 World Chemical Industry data (ICCA, 2009)
2009
Solid & Liquid Residues (kg/t)
9.932002
2.762009
-72%
Brazil CI: 2.8
Brazil CI: 11.9
2009
Energy Consumption (GJ/t)
11.962002
11.222009
-6%
World CI: 27.8
Brazil CI: 7.4
2009
Lost Time Cases Accidents Rate(employees and contractors – 1.000.000 mh)
0.852002
0.182009
-79 %
World CI: 3.9
Brazil CI: 11.8
58Source: Braskem
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