Goldman Sachs LatAm Transportation and Infrastructure Conference*

8/13/2019 Goldman Sachs LatAm Transportation and Infrastructure Conference*

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Executive Summary


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HeavyConstruction

Market leader, extensive trackrecord, with more than 60 yearsof experience

Focus on: large and complexinfrastructure projects

Products: engineeringsolutions and rental offormwork and shoring

Services: planning, design,technical supervision,

equipment and related services

Main clients:

Rea

lEstate

Market leader; acquired in 2008

Focus on: residential and

commercial constructions

Products: engineering solutionsand rental of formwork, shoringand suspended access

Services: planning, design,technical supervision, equipmentand related services

Clients: real estate companies,such as:

Rental

Market leader; started in2008

Focus on: civil construction,industry, retail e others

Products:rental and sale ofmotorized accessequipment, such as aerialwork platforms andtelescopic handlers

Cross-selling with all otherMills business units

Elected "Best Company forAccess of the Year" by theInternational Awards forPowered Access (IAPA

Awards) for the year of 2011

Mills - Business Units

2
http://www.pdgrealty.com.br/pdg/Capa.aspx


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334

182

270

103

206

99

810

384

Revenue EBITDA

Heavy Construction

Real Estate

Rental

3

Mills - 3Q13LTM Financial highlights per business unit

MargemEBITDA ROIC

48.2% 18.1%

38.1% 10.6%

54.5% 18.1%

47.4% 14.3%

26%

27%

47%

26%

33%

41%

3Q13LTMLast twelve months ended September 30, 2013. Excluding the Industrial Services business unit.


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173.4 173.4187.5

188.4

211.8222.0

95.990.3

83.3

95.7 98.9106.1

38.032.3

41.6 39.3 48.1 39.6

55.3%

52.1%

44.4%

50.8%

46.7% 47.8%

15.8%14.5% 14.5% 14.9% 14.2% 13.9%

3Q12 3Q12* 4Q12 1Q13 2Q13 3Q13

Net Revenue EBITDA Net Earnings EBITDA Margin ROIC

4

Mills - Financial Performance

Reclassified excluding the Industrial Services business unit, for comparison.

ROIC: Return on Invested Capital. Until 4Q10, ROIC was calculated considering the effective income tax rate for the period, while in 1Q11 onwards ROIC was calculated considering atheoretical 30% income tax rate.

3Q13LTMLast twelve months ended September 30, 2013.

* Excluding the positive impact of the provisions reversal in the amount of R$ 6.8 million in 3Q12.

3Q13/3Q12 3Q13/2Q13 CAGR 10-12

Net Revenue 28% 5% 37%

EBITDA 11% 7% 42%

Net Earnings 4% -18% 21%

354.5

462.8

665.5

809.7

168.4

217.4

339.0384.0

103.3 92.2

151.5 168.6

47.5% 47.0%50.9%

47.4%

21.0%

13.2%

15.9%14.4%

2010 2011 2012 3Q13LTM


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Estamos presentes em 16 estados no Brasil com 56 unidadesBranches location

As of September 30, 2013

MinasGerais

Rio Grandedo Sul

Santa Catarina

So Paulo

Mato Grosso

do Sul

Rio deJaneiro

(sede)

EspiritoSanto

Bahia

DistritoFederal

Goias

Sergipe

Paraiba

Rio GrandeCear

Piaui

Maranho

Tocantins

Par

Rondnia

Acre

Roraima Amap

Amazonas

Mato Grosso

Parana

Alagoas

States with Mills Presence

Rental

Heavy Construction

Real Estate

Pernambuco

do Norte

MillsGeographic Presence

5


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Business Units


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Heavy Construction


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Investments in infrastructure and industry in Brazil should amount R$ 1.6 trillion in the 2014-

2017 period

Oil and Gas458

Mining

48Steel10

Chemical25

Pulp and Paper19

Others540

Industry investments 2014-2017R$ 1,100 billion

Energy176

Telecom125

Sanitation45

Railways59

Roads62

Ports

34

Airports8

Infrastructure investments 2014-2017R$ 510 billion

Source: BNDESOctober 2013

Growth compared to the 2009-2012 period (%)

24% 25%

Heavy ConstructionMarket highlights


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New logistic investment program

9

18.5

23.5

- 20 40 60

Up to 20 years

In the first 5 years

HighwaysIn R$ billion

53.5

133.7

- 30 60 90 120 150

Up to 20 years

In the first 5years

TotalIn 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

PortsIn R$ billion

Total: R$ 54 billion

Source: Programa de investimento em Logstica,August 2012 and O Globo newspaper

35.0

56.0

- 20 40 60

Colunas3

Colunas2

RailwaysIn R$ billion


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Of the R$ 90 billion planned, approximately R$ 65 billion havebeen successfully auctioned

10

Tamoios

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 Goinia

Ports - 1st stage - 31 contracts

Confins airport

Galeo airport

So Paulo subway line 6

BR 262 (MG/ES)

BR 050 (MG/GO)

Salvador subway line 2

InvestmentsIn R$ billion

Dec-13

Nov-13

Oct-13

Sep-13

2014

Ago

-13


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Vales S11D project

So Lus airport

Transposition of theSo Francisco river*

Subway lines 4 and 5SP*

Viracopos andGuarulhos Airports*

CompanhiaSiderrgica do Pecmsteel mill*

North beltway*

Belo Montehydroelectric powerplant*

Norte-Sul railroad*

Duplication of BR-163

e MT-364 highways

Thermal power plant -MA

Pulp mill expansion-RS

Salvador subway

E

volution

ofrevenue

ge

neration

(Basis100=Max

imumm

onthlyrevenue

inthelifeofconstruction

)

Time of Mills participation in the construction workaverage cycle duration is 24 months

Belo Monte hydroelectricpower plant

Norte-Sul railroad

Oeste-Leste railroad

Subway line 4SP

Companhia Siderrgicado Pecm steel mill

Braslia airportFortaleza airport

Natal airport

BRT SulDF

Cais das Artes

Paraguau shipyard

Manaus thermal powerplant

Libras terminal

Colder, Teles Pires andFerreiraGomeshydroelectric power plantsComperjrefineryVale and Gerdau projectsEast beltway- SP

Gold and Silver monorail lines- SPMetropolitan Arch - RJSubway line 4RJBRT Transcarioca

Viracopos airportGuarulhos airportBeira-RiostadiumSurroundings of MaracanPorto Maravilha

Jirauhydroelectric powerplantAbreu e Lima refineryCSN steel plantParanaensesArenaManaus airportPantanalarenaNatal arenaBR-448Cuiab lightrailSubway line 2SPBRT Belo Horizonte

Newcontracts*

Contracts with growingvolume of equipment

Contracts with high volumeof equipment

Contracts in thedemobilization process

* New streches

Important contracts per stage in the evolution of monthlyrevenue from the heavy construction projects

11


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1In 3Q13

Per sector

12

Public-Private

Partnership25.2%

Public21.5%

Private53.3%

Source of Funds

Heavy Constructioncharacteristics of the major projects inprogress

Industry22%

Infrastructure29%

Others10%

Airports16.7%

Urban mobility10.4%

Stadiums11.2%

World Cupand Olympics

38%


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45.5 45.547.3 47.5

55.1 55.7 55.7

24.1 22.820.2

24.3 25.1

29.4 28.2

52.9%

50.2%

42.7%

51.3%

45.5%

52.8%50.6%

19.7%18.3%

14.8%

18.6% 17.8%20.9% 19.7%

3Q12 3Q12* 4Q12 1Q13 2Q13 3Q13 3Q13**

Net Revenue EBITDA EBITDA Margin ROIC

In R$ million

* Excluding the positive impact of the provisions reversal in the amount of R$ 1.5 million in 3Q12.

1ROIC: Return on Invested Capital. Until 4Q10, ROIC was calculated considering the effective income tax rate for the period, while in 1Q11 onwards ROIC was calculated considering atheoretical 30% income tax rate.


* * Excluding the positive effect of tax reversal in the amount of R$ 1.5 million in 3Q13.

3Q13/3Q12 3Q13/2Q13 CAGR 10-12


EBITDA 22% 17% 7%

Heavy ConstructionFinancial Performance

13

154.3

131.6

174.1

205.6

73.6

57.8

84.3

99.0

47.7%43.9%

48.5% 48.2%

24.1%

12.1%

17.2%18.1%

2010 2011 2012 3Q13LTM


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Real Estate


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Growth drivers of the residential market: housing financing

15

2.6%

3.5%

7.4%

11.5%

14.4%

24.0%

45.3%

76.1%

83.7%

Russia

India

Brazil

Chile

China

South Africa

Germany

USA

UK

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

In 2011; In 2010; In 2013.

Source: Valor EconmicoNewspaper, with data from Abecip and Secovi


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In million families% of families per social class Number of families per income range

Growth drivers of the residential market: higher purchasingpower

16

31.729.1

27.2

60.4

1.4

5.9

2007 2030E

< R$ 1,000

>= R$ 1,000 and R$ 8,000

-0.4%

+3.9%

+7.1%

+33.2 millionfamilies with income

betweenR$ 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


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Growth drivers of the residential market: industrialization ofthe construction process

17Source: Sondagem Especial Construo Civil, April 2011, CBIC , CNI, Tchne Magazine, June 2012 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

System Traditionalwith wood

Deck Type FlyingTable

Cycle betweenconcreting activities

15 days 6-8 days 4-7 days


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Revenue Breakdown

Growth drivers in the residential market: geographic expansion

18

85%

61%

49%

15%

39%

51%

2009 2010 2011 2012

New branches

Established branches

1Branches opened since November 2009


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Real Estate - Highlights

19

Low penetration of industrialization of the construction processes

Market remains good, but weaker in the North and Northeast regions

Increase market share in commercial construction

Delays in new equipment supply

Competitors overstocked with returns from stadium construction jobs

Geographic expansion


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Rental


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22

Current underutilization of motorized access equipment in Brazil and favorable regulationindicate significant growth potential in this market.

The Brazilian aerial platforms and telehandler fleet is very small compared to the US fleet; less than

3%

Modest rental penetration of 15% in Brazil. Rental penetration is approximately 40% in the USA,

60% in Japan and 80% in England

Recent regulation obliges the use of aerial platforms to lift people, increasing safety and productivity

in the work site

Brazilian fleet should increase at average annual rate of 14% in the next few years and reach

40,000 units by 2017

RentalMarket highlights

Source: Mills and Terex


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Aerial workplatforms

89%

Telescopichandlers

11%

Fleet profile

Brazil - 2012Total: 21,000

In 2012, the Brazilian fleet of motorized access equipmentgrew 32.1% compared to 2011

23Source: Mills, Terex and Yengst Associates

Aerial workplatforms

78%

Telescopic

handlers22%

USA - 2011Total: 785,000

8

11

16

21

27

40

0

5

10

15

20

25

30

35

40

45

2009 2010 2011 2012 set/13 ... 2017E

Motorized access equipment fleetIn thousands of units

+34.9%

+46.2%

+32.1%

+13.9% p.a.

+ 30.0%


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Revenue Breakdown

69%

42%

38%

31%

58% 62%

2009 2010 2011 2012

New branches

Established branches

Growth drivers in the motorized access equipment market:geographic expansion

241Branches opened since January 2010


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Ttulo da apresenao01/12/2010 (opcional)

RentalHighlights

Penetration of use to increase safety and productivity

No correlation with GDP growth due to low penetration

FX effect

Rental price

Competition

Capex

Sales of semi-new equipments

Geographic expansion


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67.4

74.2 76.1

90.1

93.9

38.0 36.9

43.6

49.352.3

56.5%

49.8%

57.3%54.7% 55.7%

19.8%16.9%

19.1% 18.5% 18.1%

3Q12 4Q12 1Q13 2Q13 3Q13

Net Revenue EBITDA EBITDA Margin ROIC

3Q13/3Q12 3Q13/2Q13 CAGR 10-12


EBITDA 38% 6% 66%

RentalFinancial Performance

26

In R$ million

95.1

175.4

253.5

334.4

51.0

93.6

141.2

182.1

53.6% 53.4% 55.7% 54.5%

19.2% 16.5% 18.2% 18.1%

2010 2011 2012 3Q13LTM

1ROIC: Return on Invested Capital. Until 4Q10, ROIC was calculated considering the effective income tax rate for the period, while in 1Q11 onwards ROICwas calculated considering a theoretical 30% income tax rate.



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Growth Plan


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In R$ million

Capex

Realized /2013 Budget (%)

86%

77%

79%

Our 2013 capex budget for rental equipment was revisedupward to R$ 481 million

28 Reclassified excluding the Industrial Services business unit, for comparison.

7447 51

77 89

104185

60

86112

131

163

161

217

274

15.4

18

20

26

49

324

413

292

406

524

2010 2011 2012 9M13 2013 Capex Budget

Rental

Real Estate

Heavy Construction


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Capturing opportunities maintaining the commitment to lowleverage

29

0.7x

1.0x

1.6x 1.6x

1.4x

1.3x

1.2x 1.2x 1.2x

1.4x

1.3x

1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12 1Q13 2Q13 3Q13

Target = 1.0x


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5 6 6 6 6 68

5 6

14 15 1617

4 4

1416

17

24

5

15 16

34

3739

49

2007 2008 2009 2010 2011 2012 2013 3Q13

Rental

Real Estate

Heavy Construction

Evolution of the number of branches

30

+10

Excluding the Industrial Services business unit branches, for comparison.


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MillsInvestor Relations

Tel.: +55 21 2123-3700

E-mail: [email protected]

www.mills.com.br/ri

Documents

Goldman Sachs LatAm Transportation and Infrastructure Conference*