NOVEMBER Q15 and 9M15 Results

Transcription

1 NOVEMBER Q15 and 9M15 Results

2 AGENDA Brazilian Fertilizer Market The Company Financial Highlights Outlook

3 Brazilian Fertilizer Market The Company Financial Highlights Outllok

4 In thousands of metric tons BRAZILIAN FERTILIZER MARKET DELIVERIES +6.0% -1.5% +7.3% -5.9% 10,169 10,783 10,621 22,136 23,742 22,333 3Q13 3Q14 3Q15 9M13 9M14 9M15 Recovery of 3Q15 delivery volume to close to 3Q14 levels, reducing the year-on-year 9M15 decline to 5.9% versus 9.6% in the first half Source: Anda September

5 In thousands of metric tons BRAZILIAN FERTILIZER MARKET - LOCAL PRODUCTION -2.2% -0.1% -7.4% +3.2% 2,412 2,358 2,356 7,039 6,515 6,726 3Q13 3Q14 3Q15 9M13 9M14 9M15 Despite the slight 3.2% upturn in local production in the first nine months, national raw material output in 3Q15 remained flat over the same period last year Source: Anda September

6 In thousands of metric tons BRAZILIAN FERTILIZER MARKET - IMPORTS +8.9% -9.0% +11.5% -11.3% 6,521 7,102 6,461 16,207 18,072 16,025 3Q13 3Q14 3Q15 9M13 9M14 9M15 Substantial decline in imports due to reduced demand in both periods Fonte: Anda setembro/2015 6

7 Brazilian Fertilizer Market The Company Financial Highlights Outlook

8 HERINGER S DELIVERIES BY CROP Soybean Corn Coffee Sugacane 1, % 1, % 1, ,3% -7,9% + 4.2% -21,4% % -2,6% % % In thousands of metric tons Other Crops ,2% % 3Q13 3Q14 Market 3Q15-1.5% Reduced share in 3Q15, given focus on increasing profitability Market share of 14.7% in 3Q15 vs 16.3% in 3Q14 Market shrinkage in the quarter due to delays in freeing credits and the late arrival of the rains Source: Heringer/Anda 8

9 HERINGER S DELIVERIES BY CROP Soybean Corn Coffee Sugarcane 3, % 3, % 3, ,7% - 5.8% -2,9% % -3,7% % +10,2% - 7.3% Em milhares de toneladas Other Crops 1, , , ,2% 8.0% 9M13 9M14 Market 9M15-5.9% Year-on-year decline in delivered volume, in line with the market Market share of 16.5% in 9M15 vs 16.4% in 9M14 Source: Heringer/Anda 9

10 In thousands of metric tons SPECIALTY PRODUCTS 1, , SALES VOLUME 3, % 1, % 3,690 1, % -0.8% 3Q14 36% SHARE OF SPECIALTY PRODUCTS 3Q15 9M14 39% 36% 9M15 38% 1, % 2,483 2, % 64% 61% 64% 62% 3Q14 3Q15 9M14 9M15 Specialty Conventional DELIVERED VOLUME AND SPECIAL PRODUCT SHARE TRENDS 27% 22% 22% 20% ,044 29% 1,321 35% 36% 37% 35% 1,725 1,824 1,841 1, Strong Increase in the share of specialty products in the Company s sales portfolio in both 3Q15 and 9M15 10

11 Brazilian Fertilizer Market The Company Financial Highlights Outlook

12 INCOME STATEMENT (R$ thousand) 3Q15 % NR 3Q14 % NR % 15/14 9M15 % NR 9M14 % NR % 15/14 Volume 1,564,936 1,756, % 3,690,211 3,894, % Net Revenue 2,011, % 1,832, % 9.8% 4,589, % 4,134, % 11.0% Cost of Goods Sold (COGS) (1,853,850) -92.1% (1,593,367) -86.9% 16.3% (4,227,646) -92.1% (3,624,977) -87.7% 16.6% Gross Profit 158, % 239, % -34.1% 361, % 510, % -29.1% Freight and Commissions (85,991) -4.3% (91,285) -5.0% -5.8% (200,874) -4.4% (203,414) -4.9% -1.2% SG&A (52,713) -2.6% (46,253) -2.5% 14.0% (145,390) -3.2% (132,036) -3.2% 10.1% EBITDA 80, % 120, % -33.6% 103, % 216, % -52.2% Net Financial Income (Expenses) 286, % 77, % 269.4% 382, % (40,798) -1.0% % Net Exchange Variation (671,141) -33.4% (186,025) -10.1% 260.8% (1,038,663) -22.6% (98,317) -2.4% 956.4% Net Income (209,553) -10.4% % n.m (389,748) -8.5% 29, % n.m Increase in net revenue in both periods due to the devaluation of the real Reduction in gross and EBITDA margins due to higher market supply in both periods Strong FX hedge gains: R$310.3 million in 3Q15 and R$435.2 million in 9M15 Negative net result in both periods, impacted by the strong exchange variation 12

13 INCOME STATEMENT (SALES AND PRODUCTION) (R$ million) 9M15 % RL 9M14 % RL 9M15 % RL 9M14 % RL 9M15 9M14 Net Revenue 4,589, % 4,134, % - 0.0% - 0.0% 4,589,086 4,134,998 COGS (4,210,775) -91.8% (3,607,660) -87.2% (16,871) % (17,317) % (4,227,646) (3,624,977) Gross Profit 378, % 527, % (16,871) % (17,317) % 361, ,021 Freights and Commission FERTILIZERS SALES SSP AND SULFURIC ACID PRODUCTION HERINGER TOTAL (200,874) -4.4% (203,414) -4.9% - 0.0% - 0.0% (200,874) (203,414) VG&A (145,390) -3.2% (132,036) -3.2% - 0.0% - 0.0% (145,390) (132,036) EBITDA 112, % 225, % (8,831) % (9,210) % 103, ,053 SSP and sulfuric acid production units being adequately maintained despite shut-down 13

14 WORKING CAPITAL DAYS Account Receivable Days Inventory Days Account Payable Days - adjusted by FINIMP Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15 WORKING CAPITAL DAYS 1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q

15 CASH FLOW (R$ thousand) 3Q15 9M15 Income before tax and social contribution (317,934) (591,652) Expenses (revenues) with no cash effect 389, ,183 Reduction/(Increase) in asset accounts (156,357) (655,162) Increase/(Reduction) in liability accounts 61, ,416 Cash flow from operating activities (23,342) (271,215) Cash flow from investment activities (16,833) (69,156) Free cash flow (40,175) (340,371) Cash flow from financing activities (18,970) 185,354 (59,145) (155,017) Statement of Cash Position Opening Cash Balance 218, ,908 Closing Cash Balance 158, ,891 Cash variation in the period (59,145) (155,017) 15

16 OWNERSHIP BREAKDOWN CURRENT OWNERSHIP BREAKDOWN 10.0% 9.5% 51.5% 29.0% Controlling Group Free Float OCP PCS FHER3 - PERFORMANCE 3,4 4,1 3,9 3,2 3,2 2,0 2,6 2,1 2,0 1,8 1,9 1,5 Free Float: 61% Brazilians (1,798 investors) and 39% international (27 investors) 16

17 Brazilian Fertilizer Market The Company Financial Highlights Outlook

18 BARTER RATIO OF AGRICULTURAL PRODUCTS VS. FERTILIZERS Soybean Paraná (bag/60kg) Corn Paraná (bag/60kg) ,2 71,4 43,9 115,5 68,2 56,8 54,3 47,0 65,0 74, Sugarcane São Paulo (metric tons) Coffee Brazil (bag/60kg) Robusta Coffee Arabica Coffee ,4 4, ,4 3, ,1 3.1 Deterioration in the barter ratio (agricultural products vs. fertilizers) due to the increase in fertilizer prices as a result of the currency devaluation Source: Agroconsult 18

19 INTERNATIONAL RAW MATERIAL PRICES Urea Potassium Chloride MAP Source: Heringer/CFR Brasil Prices in US Dollar Fertilizer raw material prices in dollars recorded a year-on-year decline 19

20 In thousands of metric tons BRAZILIAN FERTILIZER MARKET AND SEASONALITY % 39% 40% 39% 40% 38% 65% 61% 60% 61% 60% 62% E 2nd half 1st half Expectations of a 5% slide in deliveries given stronger seasonality in 2015 than in other years The business model should be analyzed on an annual basis due to seasonality Source: Anda / 2015E Heringer Estimates 20

21 BRAZIL: GRAIN PRODUCTION, PLANTED AREA AND FERTILIZER CONSUMPTION * ** , , , , , , , , , , ,868 49,866 50,982 53,430 57,060 58,036 59,709 62,117 36,971 37,847 95/96 00/01 05/06 10/11 11/12 12/13 13/14 14/15 15/16** 16/17** Productivity (1000 kg/ha) Platnted Area(1000 ha) Production (1000 t) Fertilizers (1000 t) Grains: Corn, Soybean, Rice, Beans, Sorghum, Ricinus, Cotton, Sunflower, Barley, Rye, Rapeseed, Oats, Peanut, Wheat and Triticale ¹ Total Brazil (all crops) Source: IBGE, CONAB (12th survey September 2015) ** Agroconsult projection * Heringer projection 21

22 NEW UNIT RIO GRANDE (RS) CANDEIAS (BA) Operations Startup in September 2015 RIO GRANDE (RS) 22

23 NEW UNIT CANDEIAS (BA) CANDEIAS (BA) Operations Startup in October 2015 RIO GRANDE (RS) 23

24 MIXING UNITS HERINGER NATIONWIDE OPERATIONS Market share 2014: 17.1% 22 mixing units 1 sulfuric acid and SSP production unit Installed capacity: 2014: 6.0 million ton/year 2015: 6.5 million ton/year* * Considering operations startup in Rio Grande/RS and Candeias/BA Rondonópolis Anápolis Rio Verde Patos de Minas Catalão Uberaba Manhuaçú Iguatama Bebedouro Viana Dourados Ourinhos Três São João do Manhuaçú Corações Cubatão Paulínia Porto Alegre Rio Grande Paranaguá Legend Candeias Unidades Misturadoras Unidade de SSP Mixing Units SSP Units Rosário do Catete Camaçari 24

25 IR CONTACTS THANK YOU INVESTOR RELATIONS Phone:

26 INCOME STATEMENT 3Q15 Fertilizantes Heringer S.A. (in thousando of reais) 3Q15 %NR 3Q14 %NR 15 x 14 Gross Revenue from Sales 2,048,260 1,857, % Taxes and other sales deductions (36,400) (24,321) 49.7% Net Revenue from Sales 2,011, % 1,832, % 9.8% Cost of Goods Sold (1,853,850) -92.1% (1,593,367) -86.9% 16.3% Gross Profit 158, % 239, % -34.1% Operating (expenses) revenues (91,018) -4.5% (130,810) -7.1% -30.4% Selling expenses (114,462) -5.7% (114,227) -6.2% 0.2% General and Administrative expenses (24,242) -1.2% (23,310) -1.3% 4.0% Other Operating Revenues (expenses), net 47, % 6, % 608.9% Income (loss) before financial result 66, % 108, % -38.4% Financial (expenses) Income (384,926) -19.1% (108,550) -5.9% 254.6% Financial Revenues 337, % 150, % 124.4% Financial Expenses (50,844) -2.5% (72,709) -4.0% -30.1% Net Exchange Rate Variation (671,141) -33.4% (186,025) -10.1% 260.8% Operating Profit (loss) (317,934) -15.8% % n.a. Income Tax and Social Contribution 108, % (24) 0.0% n.a. Current Year - 0.0% 21, % n.a. Deferred 108, % (21,873) -1.2% n.a. Net Income (loss) (209,553) -10.4% % n.a. EBITDA 80, % 120, % -33.6% Income (loss) before financial results and taxes 66, % 108, % -38.4% Depreciation and Amortization 13, % 11, % 10.6%

27 INCOME STATEMENT 9M15 Fertilizantes Heringer S.A. (in thousando of reais) 9M15 %NR 9M14 %NR 15 x 14 Gross Revenue from Sales 4,667,376 4,197, % Taxes and other sales deductions (78,290) (62,730) 24.8% Net Revenue from Sales 4,589, % 4,134, % 11.0% Cost of Goods Sold (4,227,646) -92.1% (3,624,977) -87.7% 16.6% Gross Profit 361, % 510, % -29.1% Operating (expenses) revenues (296,636) -6.5% (329,295) -8.0% -9.9% Selling expenses (277,823) -6.1% (267,138) -6.5% 4.0% General and Administrative expenses (68,441) -1.5% (68,312) -1.7% 0.2% Other Operating Revenues (expenses), net 49, % 6, % 706.3% Income (loss) before financial result 64, % 180, % -64.1% Financial (expenses) Income (656,456) -14.3% (139,115) -3.4% 371.9% Financial Revenues 597, % 242, % 146.4% Financial Expenses (215,766) -4.7% (283,448) -6.9% -23.9% Net Exchange Rate Variation (1,038,663) -22.6% (98,317) -2.4% 956.4% Operating Profit (loss) (591,652) -12.9% 41, % n.a. Income Tax and Social Contribution 201, % (11,918) -0.3% n.a. Current Year - 0.0% (2,379) -0.1% n.a. Deferred 201, % (9,539) -0.2% n.a. Net Income (loss) (389,748) -8.5% 29, % n.a. EBITDA 103, % 216, % -52.2% Income (loss) before financial results and taxes 64, % 180, % -64.1% Depreciation and Amortization 38, % 35, % 8.7%

28 BALANCE SHEET Fertilizantes Heringer S.A. (in thousands of reais) ASSETS Sep-15 Dec-14 LIABILITIES AND SHAREHOLDERS EQUIT Sep-15 Dec-14 Current Assets Current Liabilities Cash and Cash Equivalents 158, ,908 Local Suppliers 184,468 79,029 Accounts Receivable 735, ,570 Foreign Suppliers 1,220,536 1,205,264 Inventories 1,394, ,771 Loans and Financing 1,961,984 1,234,302 Taxes Recoverable 172, ,180 Taxes payable 2,410 2,222 Other accounts receivable 206,401 98,943 Customer s Advances 311, ,313 2,667,606 2,209,372 Others accounts payable 95,592 68,773 3,776,088 2,757,903 Non-Current Assets Non-Current Assets Taxes Recoverable 428, ,748 Loans and Financing 121,711 97,199 Other Credits 418, ,985 Other accounts payable 12,317 10,769 Long-Term Assets 847, , , ,968 Shareholders Equity Capital Stock 585, ,746 Property, Plant and Equipment 579, ,057 Net income/loss for the period -435,980-46,951 Intangiblel 7,601 7,919 Adjustment to equity valuation 42,696 43, , ,976 1,434,744 1,101, , ,210 TOTAL ASSETS 4,102,350 3,311,081 TOTAL LIABILITIES AND SHAREHOLDERS EQUITY 4,102,350 3,311,081

29 DISCLAIMER AND IFRS This presentation may include forward-looking statements about future events or results in accordance with Brazilian and international regulations governing securities. Such statements are based on assumptions and analyses made by Heringer based on its experience, the economic environment, market conditions and expected future events, many of which are beyond the Company s control. Important factors that can lead to significant differences between actual results and these forward-looking statements include Heringer s business strategy, economic conditions in Brazil and abroad, technology, financial strategy, developments in the fertilizer industry, financial market conditions, uncertainty regarding the results of the Company s future operations, plans, objectives, expectations, intentions, and other factors described in the item "Risk Factors of the IPO Prospectus filed with the Securities and Exchange Commission of Brazil (CVM). As a result of these factors, Heringer s actual results may differ substantially from those expressed or implied by the forward-looking statements. The Financial Statements of Heringer and its subsidiary were prepared and are being presented in accordance with the accounting practices adopted in Brazil, i.e., in accordance with the rules issued by the Accounting Pronouncements Committee (CPC) and approved by CVM, in effect for fiscal year 2010, as well as in accordance with the International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board (IASB). In addition, pursuant to CVM Rule 656, the Company chose to present again its 2010 Quarterly Information (ITR) in accordance with the new accounting standards mentioned above, including comparisons with that of 2009, which also was adjusted for the rules in effect in 2010, until the date of presentation of the 1 st ITR of 2011, i.e., May 15, Therefore, as required by said rule, the Financial Statements for the fiscal year ended December 31, 2010 include an explanatory note that shows, for each quarter, the impacts of the full adoption of the rules in 2010 on the results and shareholders equity.