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April 2014
Corporate Presentation
Executive Summary
He
avy C
on
str
uctio
n
•
• Market leader, extensive track record, with more than 60 years of experience
• Focus on: large and complex infrastructure projects
• Products: engineering solutions and rental of formwork and shoring
• Services: planning, design, technical supervision, equipment and related services
• Main clients:
Re
al E
sta
te
•
• Market leader; acquired in 2008
• Focus on: residential and commercial constructions
• Products: engineering solutions and rental of formwork, shoring and suspended access
• Services: planning, design, technical supervision, equipment and related services
• Clients: real estate companies, such as:
Re
nta
l
• Market leader; started in 2008
• Focus on: civil construction, industry, retail e others
• Products: rental and sale of motorized access equipment, such as aerial work platforms and telescopic handlers
• Cross-selling with all other Mills’ business units
• Elected "Best Company for Access of the Year" by the International Awards for Powered Access (IAPA Awards) for the year of 2011
Mills - Business Units
2
357
201
258
94
217
108
832
403
Revenue EBITDA
Heavy Construction
Real Estate
Rental
3
Mills - 2013¹ Financial highlights per business unit
EBITDA
Margin ROIC
49.8% 19.2%
36.4% 8.1%
56.3% 18.2%
48.4% 14.1%
27%
23%
50%
26%
31%
43%
¹ Excluding the Industrial Services business unit.
4
Mills - Financial Performance¹
¹ Reclassified excluding the Industrial Services business unit, for comparison.
² ROIC: Return on Invested Capital. Until 2010, ROIC was calculated considering the effective income tax rate for the period, while from 2011 onwards ROIC was calculated considering a
theoretical 30% income tax rate.
Variation (%) 4Q13/4Q12 4Q13/3Q13 2013/2012 CAGR 10-13
Net Revenue +12% -5% +25% +33%
EBITDA +23% -4% +19% +34%
Net Earnings +9% +15% +14% +19%
187,5 188,4
211,8 222,0
210,1
83,3 95,7 98,9
106,1 102,4
41,7 39,3 48,1
39,6 45,6
44,4%
50,8%
46,7%
47,8% 48,7%
14,5% 14,9% 14,2% 13,9% 13,4%
4Q12 1Q13 2Q13 3Q13 4Q13
Net Revenue EBITDA Net Earnings EBITDA Margin ROIC²
354,5
462,8
665,5
832,3
168,4
217,4
339,0
403,1
103,3 92,2
151,5 172,6
47,5% 47,0% 50,9%
48,4%
21,0%
12,3%
14,7% 14,1%
2010 2011 2012 2013
Estamos presentes em 16 estados no Brasil com 56 unidades
Mills – Geographic Presence
5
Branches location As of December 31, 2013
Minas Gerais
Rio Grande do Sul
Santa Catarina
São Paulo
Mato Grosso do Sul
Rio de Janeiro
(sede)
Espirito Santo
Bahia
Distrito Federal
Goias
Sergipe
Paraiba
Rio Grande Ceará
Piaui
Maranhão
Tocantins
Pará
Rondônia
Acre
Roraima Amapá
Amazonas
Mato Grosso
Parana
Alagoas
States with Mills’ Presence
Rental
Heavy Construction
Real Estate
Pernambuco
do Norte
We are present in 17 states of Brazil with 51 branches
Heavy Construction
Cinta costeira - Panamá
1,00
0,33
0,36
0,48
0,62
- 0,50 1,00
USA
Brazil
Russia
India
China
Infrastructure
Infrastructure quality ranking for BRIC countries (2011-12) Index EUA = 1.0
1,00
0,11
0,38
0,51
0,73
- 0,50 1,00
USA
Brazil
Russia
India
China
Ports
1,00
0,42
0,93
0,97
0,99
- 0,50 1,00
USA
Brazil
Russia
India
China
Railways
1,00
0,33
0,36
0,48
0,62
- 0,50 1,00
USA
Brazil
Russia
India
China
Highways
Brazil is behind other BRIC countries quality of infrastructure
Source: World Economic Forum, The Global Competitiveness Report 2012-2013
7
8
Oil and Gas 458
Mining 48
Steel 10
Chemical 25
Pulp and Paper 19
Others 540
Industry investments 2014-2017 R$ 1,100 billion
Energy 176
Telecom 125
Sanitation 45
Railways 59
Roads 62
Ports 34
Airports 8
Infrastructure investments 2014-2017 R$ 510 billion
Source: BNDES – October 2013
Growth compared to the 2009-2012 period (%)
24% 25%
Investments in infrastructure and industry in Brazil should
amount R$ 1.6 trillion in the 2014-2017 period
2,03
1,48
0,63 0,62 1,0 0,8 0,7
0,80
0,43
0,73 0,64
0,4 0,5 0,6
2,13
1,47
0,76 0,67
1,0 0,8 0,8
0,46
0,24
0,15 0,19
5,4
3,6
2,3 2,2
2,4
2,1 2,2
0,0
1,0
2,0
3,0
4,0
5,0
6,0
1971-80 1981-89 1990-2000 2001-10 2010 2011 2012
Sewage and Sanitation Energy Telecommunication Transport
19% 17% 12%
42% 36%
36%
39% 47%
52%
2010 2011 2012
Private PPP Public
Investments in Infrastructure % of GDP
Investments in Infrastructure Per source of funds
Higher participation of the private sector in infrastructure
investments in recent years
9
Source: Credit Suisse report “ The Brazilian Infrastructure: It’s ‘now or never’ ”, from July, 2013
New logistic investment program
10
18,5
23,5
- 20 40 60
Up to 20 years
In the first 5 years
Highways In R$ billion
53,5
133,7
- 30 60 90 120 150
Up to 20 years
In the first 5 years
Total In R$ billion
Total: R$ 42 billion
(7,500 km)
Total: R$ 91 billion
(10,000 km)
Total: R$ 187 billion
54,2
- 20 40 60
Colunas2
Colunas3
Ports In R$ billion
Total: R$ 54 billion
Source: Programa de investimento em Logística, August 2012 and O Globo newspaper
35,0
56,0
- 20 40 60
Colunas3
Colunas2
Railways In R$ billion
Of the R$ 106 billion planned, approximately R$ 62 billion
have been successfully auctioned, surpassing the projects
awarded to the private sector in the past ten years
11
Campinorte - Lucas do Rio Verde railway
Curitiba subway
São Paulo subway line 18
Tamoios
Ports - 2nd stage - 18 contracts
Ports - 1st stage - 31 contracts
BR 262 (MG/ES)
BR 116 (MG)
BR 153 (GO/TO)
BR 101 (BA)
BR 040 (DF-MG)
BR 163/267/262 (MS)
BR 060/153/262 (DF/GO/MG)
BR 163 (MT)
VLT Goiânia
Confins airport
Galeão airport
São Paulo subway line 6
BR 262 (MG/ES)
BR 050 (MG/GO)
Salvador subway line 2
Investments In R$ billion
2013
×
2014
Source: Mills, Goldman Sachs, and Credit Suisse
• Vale´s S11D project
• Subway lines 4 and 5
– SP*
• North beltway*
• Belo Monte
hydroelectric power
plant*
• Norte-Sul railroad*
• Duplication of BR-163
and MT-364 highways*
• Pulp mill expansion-
RS
• Goiânia airport
• Fortaleza subway
• Salvador subway
• Minas-Rio pipeline
Evo
luti
on
of
reve
nu
e g
en
era
tio
n
(B
asis
10
0=
Ma
xim
um
mo
nth
ly r
eve
nu
e in t
he
life
of co
nstr
uctio
n)
Length of time of Mills participation in the construction work – average cycle duration is 24 months
• Belo Monte hydroelectric
power plant
• Norte-Sul railroad
• Oeste-Leste railroad
• Subway lines 4 e 5 – SP
• Companhia Siderúrgica
do Pecém steel mill
• Cais das Artes
• Paraguaçu shipyard
• Confins airport
• Jacu-Pêssego highway
• Colíder and Teles Pires
hydroelectric power plants
• Comperj refinery
• Transposition of the São Francisco
river
• Vale and Gerdau projects
• East beltway- SP
• Gold monorail line- SP
• Subway line 4 – RJ
• BRT Transcarioca
• Fortaleza airport
• Natal airport
• Libra terminal
• Jirau e Ferreira Gomes
hydroelectric power plants
• Abreu e Lima refinery
• Viracopos and Guarulhos
airport
• Brasília airport
• Metropolitan Arch – RJ
• Silver monorail line- SP
• Surroundings of
Maracanã
• Porto Maravilha
New
contracts*
Contracts with growing
volume of equipment
Contracts with high volume
of equipment Contracts in the
demobilization process
* New streches
Important contracts per stage1 in the evolution of monthly
revenue from the heavy construction projects
12
1 In 4Q13
1 In 4Q13
13
Heavy Construction – characteristics of the major projects in
progress
Public-Private
Partnership 17%
Public 27%
Private 56%
Source of Funds¹
Industry 22%
Infrastructure 69%
Others 9%
Per Sector¹
In R$ million
1 ROIC: Return on Invested Capital. Until 2010, ROIC was calculated considering the effective income tax rate for the period, while from 2011 onwards ROIC was calculated considering a
theoretical 30% income tax rate.
* Excluding the positive effect of tax reversal in the amount of R$ 1.5 million in 3Q13.
Variation (%) 4Q13/4Q12 4Q13/3Q13 2013/2012 CAGR 10-13
Net Revenue +24% +5% +25% +12%
EBITDA +45% -1% +28% +14%
Heavy Construction – Financial Performance
14
47,3 47,5
55,1 55,7 55,7
58,6
20,2
24,3 25,1
29,4 28,2 29,3
42,7%
51,3%
45,5%
52,8% 50,6%
49,9%
14,8%
18,6% 17,8%
20,9% 19,7% 19,1%
4Q12 1Q13 2Q13 3Q13 3Q13* 4Q13
Net Revenue EBITDA EBITDA Margin ROIC¹
154,3
131,6
174,1
217,0
73,6
57,8
84,3
108,1
47,7%
43,9%
48,5% 49,8%
24,1%
12,1%
17,2%
19,2%
2010 2011 2012 2013
Real Estate
Mast climbing platform
Growth drivers of the residential market: housing financing
16
2,6%
3,5%
7,4%
11,5%
14,4%
24,0%
45,3%
76,1%
83,7%
Russia¹
India¹
Brazil³
Chile²
China¹
South Africa¹
Germany¹
USA¹
UK¹
Housing financing relative to GDP (%)
3,1%
4,1%
5,4%
6,8%
7,4%
2009 2010 2011 2012 2013
Housing financing relative to GDP (%) in Brazil
¹ In 2011; ² In 2010; ³ In 2013.
Source: Valor Econômico Newspaper, with data from Abecip and Secovi
In million families
% of families per social class Number of families per income range
Growth drivers of the residential market: higher purchasing
power
17
31,7 29,1
27,2
60,4
1,4
5,9
2007 2030E
< R$ 1,000
>= R$ 1,000 and <= R$ 8,000
> R$ 8,000
-0.4%
+3.9%
+7.1%
+33.2 million families with income
between
R$ 1,000 to 8,000
Growth rate
(%, p.a.)
10,7 6,8 3,6
38,2
28,0
20,1
37,0
49,7
58,4
8,1 9,8 11,7
6,0 5,7 6,2
2002 2009 2014E
Class A
Class B
Class C
Class D
Class E
Source: IBGE and FGV
Growth drivers of the residential market: industrialization of
the construction process
18 Source: Sondagem Especial Construção Civil, April 2011, CBIC , CNI, and Mills
The major challenge for the sector: labor
89% of companies from the construction industry stated that
lack of qualified labor is a problem for the company
94% of companies from the construction industry facing
shortages of skilled manpower have difficulty finding workers
for basic construction activities, such as bricklayers and
laborers
Solution: Industrialization of the construction process
Only 7% of companies from the construction industry plan to
deal with the shortage of skilled labor by changing the
building process to an industrial assembly model
Stages of industrialization of the construction process
19
1 Approximately 800 m2
Source: Téchne Magazine, June 2012 and Mills
System Traditional with wood Traditional with steel Deck type Flying table
Cycle between
concreting activities 15 days 7-10 days 6-8 days 4-7 days
Labor required1 30 people 20 people 12 people 10 people
Revenue Breakdown
Growth drivers in the residential market: geographic expansion
20
85%
61%
49% 45%
15%
39%
51% 55%
2009 2010 2011 2012 2013
New branches ¹
Established branches
1 Branches opened since November 2009
21
18,3
30,6
23,4
19,8
23,3
67,4%
-23,5%
-15,4%
17,6%
-60%
-40%
-20%
0%
20%
40%
60%
80%
100%
-
5,0
10,0
15,0
20,0
25,0
30,0
35,0
2009 2010 2011 2012 2013
Yo
Y (
%)
La
un
ches (
in R
$ b
illio
n)
1 Cyrela, Direcional,Even, Eztec, Gafisa, Helbor, MRV, PDG, Rodobens, Tecnisa and Trisul
Source: Operational reports from companies, Criactive and Mills
Total launches1
in R$ billion
24,6
28,2
31,0
38,9
43,1
14,6%
10,2%
25,5%
10,7%
0%
5%
10%
15%
20%
25%
30%
35%
-
5,0
10,0
15,0
20,0
25,0
30,0
35,0
40,0
45,0
50,0
2009 2010 2011 2012 2013
Yo
Y (
%)
Co
nstr
ucte
d a
rea
(in
mill
ion
m2)
Constructed area
in million m2
Launches in 2013 represent construction opportunities in
2014
1 ROIC: Return on Invested Capital. Until 2010, ROIC was calculated considering the effective income tax rate for the period, while from 2011 onwards ROIC
was calculated considering a theoretical 30% income tax rate.
Variation (%) 4Q13/4Q12 4Q13/3Q13 2013/2012 CAGR 10-13
Net Revenue -18% -25% +8% +35%
EBITDA -35% -30% -17% +29%
Real Estate – Financial Performance
22
In R$ million
66,0 64,9 66,5
72,4
54,2
26,1 27,7 24,6 24,4
17,1
39,6%
42,8%
37,0% 33,7%
31,5%
12,6% 12,8%
9,3% 8,2%
3,2%
4Q12 1Q13 2Q13 3Q13 4Q13
Net Revenue EBITDA EBITDA Margin ROIC¹
105,1
155,8
238,0
258,0
43,9
66,0
113,4
93,8
41,7% 42,4% 47,7%
36,4%
23,5%
14,3% 15,7%
8,1%
2010 2011 2012 2013
Castelão stadium – Fortaleza, CE
Rental
24
Growth drivers in the motorized access equipment market:
safety and productivity
Source: Mills
Market penetration
through
substitution of less
secure and
efficient access
methods
Recent safety standards (NR-18 and NR-35) oblige the use of aerial platforms to lift people,
increasing safety and productivity in the work site
Aerial work platforms
95%
Telescopic handlers
5%
Brazil - 2013 Total: 29,500
Growth drivers in the motorized access equipment market:
low penetration
25 Source: Mills and Yengst Associates
Aerial work platforms
78%
Telescopic handlers
22%
USA - 2011
Total: 785,000
Fleet Profile
The Brazilian aerial platforms and telehandler fleet is very small compared to the US fleet; less
than 5%.
Modest rental penetration of 15% in Brazil. Rental penetration is approximately 40% in the USA,
60% in Japan and 80% in England.
Revenue Breakdown
69%
42% 38%
31%
31%
58% 62%
69%
2009 2010 2011 2012 2013
New branches¹
Established branches
Growth drivers in the motorized access equipment market:
geographic expansion
26
1 Branches opened since January 2010
In 2013, the Brazilian fleet of motorized access equipment
grew 40% compared to 2012
27 Source: Mills and Yengst Associates
8
11
16
21
30
35%
46%
33%
40%
20%
30%
40%
50%
60%
70%
80%
0
5
10
15
20
25
30
35
2009 2010 2011 2012 2013
Fleet size YOY (%)
Motorized access equipment fleet
In thousands of units
Rental – Recognition of our differentiation
28
2013
• Nominated for Best Company for Access of the Year
• Nominated for IPAF Training Center of the Year
Award will be granted in April 2014
2011
• Elected Best Company for Access of the Year
Variation (%) 4Q13/4Q12 4Q13/3Q13 2013/2012 CAGR 10-13
Net Revenue +31% +3% +41% +55%
EBITDA +52% +7% +43% +58%
Rental – Financial Performance
29
In R$ million
1 ROIC: Return on Invested Capital. Until 2010, ROIC was calculated considering the effective income tax rate for the period, while from 2011 onwards ROIC
was calculated considering a theoretical 30% income tax rate.
74,2 76,1
90,1 93,9
97,2
36,9
43,6 49,3
52,3 56,0
49,8%
57,3%
54,7% 55,7%
57,7%
16,9% 19,1% 18,5% 18,1% 17,5%
4Q12 1Q13 2Q13 3Q13 4Q13
Net Revenue EBITDA EBITDA Margin ROIC¹
95,1
175,4
253,5
357,3
51,0
93,6
141,2
201,2
53,6% 53,4% 55,7% 56,3%
19,2% 16,5% 18,2% 18,2%
2010 2011 2012 2013
Growth Plan
The potential penetration of our services for increasing
productivity enables us to grow independently of economic
performance
60%
35%
31%
44%
25%
-10%
0%
10%
20%
30%
40%
50%
60%
70%
2009 2010 2011 2012 2013
Mills GDP Industrial GDP Civil Construction GDP
Source: Mills and Bacen
Mills revenue1 versus GDP
yoy variation (%)
31 ¹ Excluding the Industrial Services business.
74 47 51
106
37
104 185
60
90
25
131
163
161
267
169
15
18
20
36
324
413
292
499
231
2010 2011 2012 2013 2014 Capex Budget
Rental
Real Estate
Heavy Construction
In R$ million
Capex¹
2014 Capex Budget
(%)
16%
11%
73%
We invested R$ 464 million in rental equipment in 2013
32 ¹ Reclassified excluding the Industrial Services business unit, for comparison.
Capturing opportunities maintaining the commitment to low
leverage
33
0.7x
1.0x
1.6x 1.6x
1.4x
1.3x
1.2x 1.2x 1.2x
1.4x
1.3x
1.5x
1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13 4Q13
Target = 1.0x
Net debt/EBITDA
5 6 6 6 6 6 8
5 6
14 15 16 17
4 4
14 16
17
26
5
15 16
34
37 39
51
2007 2008 2009 2010 2011 2012 2013
Rental
Real Estate
Heavy Construction
Evolution of the number of branches¹
34
+12
¹ Excluding the Industrial Services business unit branches, for comparison.
