Financial Highlights (*)

Transcription

1 B2W ANNOUNCES GROSS REVENUE GROWTH OF 64% AND EBITDA GROWTH OF 70% IN 2006 São Paulo, February 15, 2007 B2W Companhia Global do Varejo, company resultant from the merger between Americanas.com and, announces today its consolidated results for As the merger was approved at the Extraordinary Shareholders Meeting held on December 13, 2006, for comparison purposes, the comments on the merged companies performance were based on pro-forma, unaudited income statements for 2005 and 2006 (Exhibit I). Such pro-forma information does not replace audited Financial Statements filed at the Brazilian Stock and Exchange Commission (CVM). B2W s portfolio comprises Americanas.com, Shoptime,, Ingresso.com, Finance and Viagens, offering over 30 product categories throughout its internet channel, catalogues, TV and kiosks. FINANCIAL HIGHLIGHTS 2006 Consolidated Results Americanas.com / Shoptime EBITDA (R$ million) Financial Highlights (*) 86% R$ MM Americanas.com/ Shoptime B2W 61% Q05 4Q Gross Revenue 1, ,364 1,439 EBITDA EBITDA Margin 13.4% 12.8% 10.7% 10.6% 12.4% 11.9% EBITDA (R$ million) 38% Q05 4Q B2W Companhia Global do Varejo EBITDA (R$ million) 53% % % 207 4Q05 4Q Gross Revenue Growth of 64%. Highlights of the Period (*) Gross Margin 29.8% of Net Revenues, growth of 150 basis points. EBITDA Margin 12.4% of Net Revenues, growth of 50 basis points. Launch of s Card Over 50,000 cards were issued in The documents concerning the merger are under analysis of CVM. Upon the completion of legal procedures, B2W will be entitled to change its ticker to BTOW3. B2W is subject to the Listing Rules of Novo Mercado, the highest level of Corporate Governance of the São Paulo Stock Exchange (Bovespa). (*) Financial Highlights and Highlights of the Period are based on proforma results. 1

2 GENERAL CONSIDERATIONS As the merger was approved at the Extraordinary Shareholders Meeting held on December 13, 2006, for comparison purposes, the comments on the merged companies performance were based on pro-forma, unaudited income statements for 2005 and 2006 (Attachment I). Such pro-forma information does not replace audited Financial Statements filed at the Brazilian Stock and Exchange Commission (CVM). The following discussion is solely based on the consolidated result of the brands Americanas.com, Shoptime and, excluding, then, the subsidiaries (Ingresso.com, Finance and Viagens). The Company highlights that gross revenue and EBITDA breakdown by brand shown in Exhibit II are extraordinary and non-recurring, as well as, the gross revenues and EBITDA of the subsidiaries. HIGHLIGHTS OF THE PERIOD Gross Revenue growth of 64%. In 2006, the Company s gross revenue amounted to R$ 2.4 billion (US$ 1.1 billion), 64.3% up over Gross Margin moved up 150 basis points. Gross profit in the period reached R$ million (US$ million), leading to a gross margin of 29.8% of net revenues in 2006, versus R$ million (US$ million) and gross margin of 28.3%, reported in EBITDA 1 growth of 70%. EBITDA moved up 70.2% over 2005, reaching R$ million (US$ 95.4 million). EBITDA margin went up to 12.4%, from 11.9% posted in Launch of Credit Card. In mid September, 2006, we launched s credit card. The holders of this card are enrolled in a Reward Program, and additionally, may participate in special promotions on s website. By the end of 2006, over 50,000 cards had been issued. Approval of the merger at first call. On December 13, the Extraordinary Shareholders Meeting approved the merger of the companies Americanas.com and, having the operation been submitted to the Brazilian antitrust agencies (the CADE Administrative Board for Economy Protection, SDE Secretariat of Economic Law and SEAE Secretariat for Economy Monitoring) on time and under the form required by the Law. The Concentration Act is currently being analyzed by the SEAE and the SDE and will be subsequently submitted to the CADE s approval. B2W is following the progress of the process and collaborating with authorities as required. Documents related to the merger are being analyzed by the CVM and, as soon as the proceedings are completed, B2W will be authorized to change its ticker to BTOW3. It is important to note that SUBA3 s shares already reflect B2W s total capital. A multifunctional group was appointed to compose the integration team, responsible for mapping and implementing the synergies initially estimated between the companies. Since its inception, B2W has high levels of Corporate Governance, shares traded on the Novo Mercado and additional rules, including the election of the Board of Directors with five members appointed by Lojas Americanas and four independent members. 2

3 COMMENTS ON THE PERFORMANCE GROSS REVENUE In the 4Q06, consolidated gross revenue went up by 49.6%, from R$ million in 4Q05 to R$ million. Consolidated gross revenue reached R$ 2.4 billion (US$ 1.1 billion) in 2006, 64.3% up year-on-year. It is worth mentioning that Shoptime s performance has been booked as of September 2005, when the Company was acquired. CAGR = 68.1% 2,364 1, Groos Revenues (R$MM) GROSS PROFIT Gross profit totaled R$ million in 2006 (29.8% of Net Revenue), a 71.5% increase over the R$ million (28.3% of Net Revenue) recorded in % 29.8% Gross Profit (R$MM) Gross Margin (%) OPERATING EXPENSES Selling, general and administrative expenses amounted to R$ million, 17.4% of Net Revenue in 2006, versus the R$ million reported in 2005 (16.4% of Net Revenue). The 100 basis points increase reflects the inclusion of Shoptime s expenses, which were consolidated as of September, Extraordinary Expenses totaled R$ 18.7 million in 2006, versus R$ 15.5 million recorded in These expenses refer to costs related to s IPO and secondary offering held in 1Q05 and 2Q06, respectively. 3

4 EBITDA Fourth-quarter EBITDA grew 53.0% year-on-year, reaching R$ R$ 71.7 million. The EBITDA Margin represented 13.2% of Net Revenue. In 2006, EBITDA was R$ million, 70.2% up on The EBITDA Margin was 12.4% of Net Revenue. Performance indicators in 2006 show B2W s improvement in operating performance, compared to the same indicators in the previous year. EBITDA is based on earnings before the financial result, excluding depreciation, amortization and extraordinary expenses. 11.9% 12.4% EBITDA (R$MM) EBITDA Margin (%) FINANCIAL RESULT In 2006, net Financial Result reached R$ 72.1 million (4.3% of Net Revenue), versus R$ 45.3 million (4.4% of Net Revenue) in This result was heavily impacted by the increase in tax and contribution on financial transactions, in addition to the effect of Shoptime s acquisition (booked as of September, 2005). EQUITY RESULT The equity result includes, basically, the subsidiaries Ingresso.com, Viagens and Finance. In 2006, equity result reported R$ 6.4 million loss, especially due to the impact of Viagens and Finance operations, which are in the investment phase. The results posted by these subsidiaries are under our expectations and we reinforce our enthusiasm about their growth outlook. NON OPERATING (EXPENSE) REVENUES Non-operating revenue totaled R$ 49.9 million in 2006, and basically reflects the capital gain resulting from Toulon s merger, which was financially realized. This amount was duly taxed by the Company, with due tax effects booked in the Income Tax and Social Contribution account of the 2006 Income Statement. NET INCOME AND NET EARNINGS PER SHARE Net Income stood at R$ million (8.6% of Net Revenue) in 2006, versus R$ 56.0 million (5.5% of Net Revenue) in Net Earnings per share went up 155%, from R$ in 2005 to R$ in

5 KEY METRICS ON SUBSIDIARIES ONLINE TICKETS SALES Ingresso.com offers technology and purchase service of tickets to shows, theater plays, soccer games, parks, events and movies via web. Ingresso.com is currently the largest online seller of movie tickets in Brazil. Our clients are able to choose their seat in some movie theaters, and some mobile operators deliver the purchased movie ticket digitally. Key Metrics 1Q06 2Q06 3Q06 4Q Ingresso.com Tickets sold 206, , , ,783 1,048,966 Gross revenues (R$ 000's) 1,155 1,478 1,272 1,257 5,162 EBITDA (R$ 000's) (90) Active customers (000's) ONLINE TRAVEL SALES Viagens offers our clients hotel booking, travel packages, airline tickets, cruises and car rental. Through the new online booking infrastructure, Viagens clients may choose and book hotels all over Brazil and abroad, buy airline tickets for domestic and international flights and book travel packages that include transportation, accommodation and tours. Key Metrics 1Q06 2Q06 3Q06 4Q Travel Gross bookings (R$ 000's) 7,588 8,805 10,384 11,087 37,863 EBITDA (R$ 000's) (556) (145) (485) (371) (1,558) Active passengers (000's) ONLINE FINANCING Through our partnership with Cetelem, we offer s Credit Card and financing in up to 24 interest bearing installments for purchases made on s website including an exclusive Reward Program and special promotions to cardholders. By the end of 2006, after approximately 6 months of operations, we had issued over 50,000 cards. Key Metrics 1Q06 2Q06 3Q06 4Q Finance Gross billings (R$ 000's) ,310 6,745 8,303 EBITDA (R$ 000's) - - (569) (5,223) (5,792) Cards issued - - 1,314 50,630 51,944 5

6 CORPORATE GOVERNANCE AND CAPITAL MARKETS B2W is subject to the Listing Rules of Novo Mercado, the highest level of Corporate Governance of the São Paulo Stock Exchange Bovespa. According to these rules, the company s ownership structure must be exclusively composed of common shares and the company s Board of Directors has to include independent members. B2W s Board of Directors is composed of nine members, out of whom five are appointed by Lojas Americanas and four are independent members. Lojas Americanas and B2W have entered into a Voting and Assumption of Debt Agreement, which rules corporate governance and stock ownership matters. Lojas Americanas has also entered into a 4-year standstill agreement limiting, among other things, its ability to acquire additional shares of B2W in excess of certain specified levels, without prior approval of a majority of independent members of the Board of Directors. Lojas Americanas is not allowed to sell its B2W s shares for 2 years, after the conclusion of this operation. POTENTIAL SYNERGIES Management of both companies expects to capture significant synergies as a result of the merger. Revenues synergies are projected to be captured from offering new products and services to both s and Americanas.com s existing customer bases. The combination is expected to facilitate the development and growth of services, such as online travel and tickets sale, The combined company expects to achieve a net present value of synergies of approximately R$ 800 million. Considering the synergies opportunities, we point out the rationalization o four distribution centers through a new logistic operation. GROWTH EXPECTATION IN THE E-COMMERCE SEGMENT Forrester Research, an international consulting firm specialized in e-commerce studies and projections, forecasts, for the Brazilian market, an average annual growth of 34%, reaching R$12.8 billion in For projections purposes, the Company expects to present, at least, an average annual growth in line with the market, but it is worthy mentioning that We Want More. CAGR = 34% E 2008E 2090E 2010E Merchandise e-commerce Market (R$B) 6

7 EXHIBIT I PRO-FORMA INCOME STATEMENT For comparison purposes, the comments on the merged companies performance were based on pro-forma, unaudited income statements for 2005 and The table below excludes the results of the subsidiaries Ingresso.com, Finace and Viagens. B2W S/A Pro Forma Income Statement In thousand of Reais Consolidated Americanas.com/Shoptime/ Gross sales 2,363,611 1,439,009 Taxes, returns and rebates (697,014) (417,274) Net sales 1,666,597 1,021,735 Cost of goods sold (1,170,098) (732,172) Gross profit 496, ,563 Gross margin (% n.s.) 29.8% 28.3% Operational expenses (325,263) (195,188) Selling (289,565) (167,642) Extraordinary expenses (18,740) (15,457) Depreciation and amortization (16,982) (11,736) Other operational revenues (expenses) 24 (352) Operating profit before net financial results 171,237 94,375 Operational margin (% n.s.) 10.3% 9.2% Net financial result (72,054) (45,272) Operating profit before equity result in subsidiaries 99,182 49,103 Equity result in subsidiaries (6,410) 40 Non-operating expenses, net 49,851 (7,947) Deferred Income tax and social contribution ,826 Net income for the period 142,729 56,022 EBITDA 206, ,569 EBITDA margin (% n.s.) 12.4% 11.9% 7

8 EXHIBIT II PRO-FORMA GROSS REVENUE AND EBITDA The Company highlights that Gross Revenues and EBITDA breakdown by brands, presented in the table below, is extraordinary and non-recurring. R$ MM Americanas.com / Shoptime 4Q06 4Q Q06 4Q Gross Revenue EBITDA EBITDA Margin 14.5% 13.3% 13.4% 12.8% 11.1% 11.7% 10.7% 10.6% CHARTS PRO-FORMA GROSS REVENUE AND EBITDA GROSS REVENUE (R$MM) 76.7% 51.4% 45.5% 46.1% Americanas.com/Shoptime Americanas.com/Shoptime Q05 4Q06 EBITDA(R$MM) AND EBITDA MARGIN (% NET REVENUE) 13.4% 12.8% % % % % % % 22 Americanas.com/Shoptime Americanas.com/Shoptime 4Q05 4Q06 8

9 CONFERENCE CALL ON 2006 RESULTS Conference Call simultaneously translated into English followed by a bilingual Q&A session will be held on: Friday, February 16, 2007 Portuguese 9:00 a.m. US EST (12h00 Brasília) Connecting Number: +55 (11) Code: B2W English 9:00 a.m. US EST (12h00 Brasília) Connecting Number: +1 (973) Code: B2W or Investor Relations Phone: +55 (11) ri@submarino.com.br Investor Relations Website: 1 EBITDA - Earnings before Interest, Tax, Depreciation and Amortization, and excluding extraordinary expenses, is presented as additional information because we believe that it is an important indicator of our operating performance, besides being useful to compare our performance with other companies of the e-retail sector. However, no figure should be considered alone as a substitute to net income calculated in accordance with US GAAP or Brazilian Corporate Legislation (BR GAAP) or yet as a measure of the Company s profitability. In addition, our calculations may not be comparable to other similar methods adopted by other companies 2006 Average US Dollar: R$ 2.17 We make forward-looking statements that are subject to risks and uncertainties. These statements are based on the beliefs and assumptions of our management, and on information currently available to us. Forward-looking statements include statements regarding our intent, belief or current expectations or that of our directors or executive officers. Forward-looking statements also include information concerning our possible or assumed future results of operations, as well as statements preceded by, followed by, or that include the words ''believes,'' ''may,'' ''will,'' ''continues,'' ''expects,'' ''anticipates,'' ''intends,'' ''plans,'' ''estimates'' or similar expressions. Forward-looking statements are not guarantees of performance. They involve risks, uncertainties and assumptions because they relate to future events and therefore depend on circumstances that may or may not occur. Our future results and shareholder values may differ materially from those expressed in or suggested by these forward-looking statements. Many of the factors that will determine these results and values are beyond B2W ability to control or predict. 9