Tereos apresentacao 1_t13_eng

Tereos Internacional First Quarter 2012/13 Results Conference Call Presentation

São Paulo – August 10th, 2012

Quarter Highlights

Q1 2012/13 Financial Results

Operating Segment Review

Cash Flow and Debt Position

Outlook

Quarter Highlights

4

Q1 2012/13 – Key Takeaways R$370 million Capital Increase: 100% subscribed

New free float: conclusion of the shareholder restructuring of the controlling shareholder of Tereos Internacional with cooperatives of cereal growers joining directly the Company

• The direct participation of Tereos in Tereos Internacional is now of 69.6% and free float was thus increased from 10.7% to 29.3% (after capital increase)

Share capital increase: R$370 million, subscribed at 100%

• Proceeds will finance cereal expansion and the diversification of production in the European cereal activities

Historical

Shareholders TEREOS

29.3% 1.1%

New float

69.6%

0.4%

11.0%

C.A. d’Hochefelden

Theal

Noralliance Dév.

Axereal

Noriap

Agrial

Uneal Agralys

Epis-Centre Acolyance

Thémis Agro-Industrie

0.4%

1.0%

0.3%

0.8%

6.5% 1.2% 2.3%

1.0%

3.2%

1.2%

Other Minority

Shareholders

Stable revenues: R$1.7 billion :

-1.9% y-o-y, at constant currency

+4.6% y-o-y, as reported

• Favorable pricing in practically all our products, except for Brazilian ethanol, partially compensating the reduction in volumes

Adjusted EBITDA: R$156 million : -26.7% y-o-y, at constant currency

-24.3% y-o-y, as reported

• Delayed production in Brazil due to unusual weather conditions impacting

volumes in the quarter

5

Q1 2012/13 – Financial Highlights

Sugar:

Unusual rainfalls in Brazil

Rebound in world prices in Q1 12/13

Brazilian domestic prices remained stable, less impacted by

world prices swings

Starch:

A severe drought in the US and in Europe is driving corn and

wheat prices up

EU demand for starch and derivatives is flat in food, declines

in the industrial sector (corrugated paper)

Ethanol:

Brazil has faced another quarter of lackluster prices in the

local market

EU: a growing market, but facing headwinds from lower

gasoline consumption

US ethanol prices rallied at the end of June as a result

of concerns over drought in the Midwest

Q1 2012/13 – Market Fundamentals

6 Source: Bloomberg

400

470

540

610

680

750

Apr-11 Aug-11 Dec-11 Apr-12

NY#11 LIFFE #5

US$/MT

400

500

600

700

800

700

1000

1300

1600

1900


Brazil ESALQ Europe Rotterdam

R$/m³ €/m³

170

190

210

230

250

270


Corn Matif Wheat Matif

€/MT

Q1 2012/13 Financial Results

1604 1678

(94)

+7 +103

+59

Q1 2011/12 Brazil IndianOcean

StarchEurope

EthanolEurope

Q1 2012/13

1604 1678

+106

(51)

+32

(13)

Q12011/12

Currency Volume Price & Mix Others Q12012/13

Q1 2012/13 – Revenues Stable Turnover Despite Delay in Brazilian Crushing Season

8

+4.6%

Net Revenues (R$ MM)

Sugarcane Revenues: R$560 million (33.4% of total)

Brazil: R$408 million -19%, as reported production delayed onto 2nd, 3rd and 4th quarters

Indian Ocean: R$152 million +5%, as reported one shipment from Reunion Island postponed to 2nd quarter, Mozambique performing well

Cereal Revenues: R$1,118 million (66.6% of total)

Starch & Sweeteners: R$797 million +15%, as reported price & mix:+4%, volume: +1%

Alcohol / Ethanol Europe: R$322 million +23%, as reported stable prices, increase in trading volumes from Tereos

+4.6%

206

(71)

+9 +23

(12)

+1

156

Q1 2011/12 Brazil IndianOcean

StarchEurope

EthanolEurope

Holding Q1 2012/13

Q1 2012/13 - Adjusted EBITDA Delay in Brazilian crop and increase in cereal costs (Alcohol & Ethanol Europe)

9

Sugarcane Adjusted EBITDA: R$57 million (36.4% of total)

• Brazil: delayed production due to heavy rainfalls.

• Indian Ocean: higher prices coupled with better volumes in Mozambique

Cereal Adjusted EBITDA: R$102 million (65.0% of total)

• Starch Europe: increase in Adjusted EBITDA margin (9.3% in Q1 2012/13 vs 7.4% in Q1 2011/12)

• Ethanol Europe: increase in cereal costs partially offset by higher trading volumes

Adjustments

• Biological assets (-R$7 MM), financial instruments (+R$1 MM)

Margin 9.3%

Adjusted EBITDA (R$ MM)

Margin 12.9%

Operating Segment Review

Sugarcane

Brazil - Indian Ocean

Ethanol Sales (‘000 m³) Energy Sales (‘000 MWh) Sugarcane Crushing (MM t) Sugar Sales (‘000 t)

12

Sugarcane crushing: 4.7 million tons in Q1 2012/13 (60% from sugarcane suppliers)

Average yield to date of 80 tons of cane per hectare (3.8% above budget)

Production: Sugar: 317,000 tons 60% of mix Ethanol: 132,100 m³ 40% of mix

Cogeneration: volume sold increased to 94 GWh (+11.3%)

-17.7% YoY -18.2% YoY +11.3% YoY

Sugarcane Brazil – Production & Sales Lower crushing volumes due to weather-related issues

5.8

7.8

2.6

4.7

Q1

11

/12

Q2

11

/12

Q3

11

/12

Q4

11

/12

Q1

12

/13

-20.1% YoY

305 374 375

249 251 Q

111

/12

Q2

11

/12

Q3

11

/12

Q4

11

/12

Q1

12

/13

140 99 91

151 115

40

40

Q1

11

/12

Q2

11

/12

Q3

11

/12

Q4

11

/12

Q1

12

/13

84 106

90 86 94

Q1

11/1

2

Q2

11/1

2

Q3

11/1

2

Q4

11/1

2

Q1

12/1

3

Extraordinary rainfall led to a delay in sugarcane crushing into the following quarters but allow an increase in crushing forecast for 2012/13 season from 17.5 million to 18.2 million.

The season is expected to end in the first week of December

502

408

+18

(52) (31)

(36)

+7

Q12011/12

Price &Mix

Volume Price &Mix

Volume Others * Q12012/13

Sugarcane Brazil – Q1 Financials Revenues benefitting from high prices and a weak Real, ethanol prices return to normal levels

* includes Cogeneration, Agricultural Products and Hedging

Key Figures

In R$ Million

Q1

2012/13

Q1

2011/12 Change

Revenues 408 502 -19%

Gross Profit -14 89 -116%

Gross Margin -3.5% 17.8%

EBITDA 32 136 -77%

EBITDA Margin 7.7% 27.0%

Adjusted EBITDA 41 112 -64%

Adjusted EBITDA Margin 10.0% 22.3%

CAPEX 154 139 11%

Adjusted EBITDA: R$41 million

• Fair value of biological assets: -R$10.2 million

• Financial instruments: R$1.0 million

• Adjusted EBITDA Margin1 including tilling as

depreciation: 17.1%

CAPEX: R$154 million: including R$47 million

of plantation. Thanks to the rains, 53% of the

winter planting program has been completed

Sugar: 58.8% of total net revenues

• Volumes decreased -17.7% to 250,500 tons

• Sugar prices were at 956.4 R$/ton (Y-o-Y: +11.4%)

Ethanol: 31.9% of total net revenues

• Volume sold decreased 18.2% to 115,000 m3

• Prices were at 1,136.2 R$/m3 (Y-o-Y: -19.0%)

Cogeneration: energy revenues amounted

R$14.8 million (Y-o-Y: +30.0%)

13

(1) Tereos Internacional allocates tilling expenses as

cost. If tilling expenses were allocated as investment &

ethanol resales excluded, Adjusted EBITDA would

have reached R$69.5 million.


Sugar Ethanol

65

315 275

43 116

Q1

11/1

2

Q2

11/1

2

Q3

11/1

2

Q4

11/1

2

Q1

12/1

3

Sugarcane Indian Ocean – Production and Q1 Financials Early start in Mozambique, stable results in Réunion Island

14

La Réunion

Sugarcane Crushing (’000 t)

Mozambique

Sugarcane Crushing (‘000 t)

+78.8% YoY

Reunion Island

No sugarcane crushing, season starting in July

• Sugar sales: 58,800 tons

Revenues

• Q1 2012/13: R$140.9 million vs R$141.6 million, as reported

Due to a delay of one shipment to Europe

Adjusted EBITDA

• Q1 2012/13: R$25.9 million vs R$18.8 million, as reported

• Adjusted EBITDA margin 18.4%, 510 bps increase thanks to

higher selling prices

CAPEX: R$29 MM in Q1 2012/13 allocated for maintenance

costs and regular replacement of industrial equipment

Mozambique

Sugarcane crushing: 116,000 tons &

Sugar production: 9,000 tons

• Earlier start as larger crop expected (850,000 tons, +21.4%)

• Better industrial recovery

Revenues

• Q1 2012/13: R$11.2 million (2.8x Y-o-Y)

Adjusted EBITDA

• Traditionally negative due to seasonality

• R$2.1 million improvement Y-o-Y, as reported

CAPEX: R$7.7 MM in Q1 2012/13 allocated for ongoing

irrigation expansion, planting program and factory

improvements

Key Figures

In R$ Million

Q1

2012/13

Q1

2011/12 Change

Revenues 152 146 5%

Gross Profit 35 20 72%

Gross Margin 23.1% 14.0%

EBITDA 19 8 140%


Adjusted EBITDA 16 7 133%


CAPEX 37 32 15%

989 898

0

Q1

11

/12

Q2

11

/12

Q3

11

/12

Q4

11

/12

Q1

12

/13

New Cereal Segmentation

Starch & Sweeteners

Alcohol & Ethanol Europe

New Segmentation for The Cereal Division To better reflect the evolution of the segment

16

“Starch & Sweeteners”

“Alcohol & Ethanol”

Marckolsheim

Nesle

Aalst

Saragosse

Saluzzo

Selby

Haussimont

BENP

DVO

Pre

vio

us S

yra

l

Pre

vio

us

BE

NP

/ D

VO

New

Segmentation:

221 221 204 210 217

Q1

11

/12

Q2

11

/12

Q3

11

/12

Q4

11

/12

Q1

12/1

3

Starch & Sweeteners - Production and Sales Slight increase in volumes sold, including perimeter effect

Cereal grinding: 723,000 tons -2.2% vs. Q1 2011/12 (excluding Haussimont/Syral Halotek)

Sales volumes

• Starch & Sweeteners: slight increase (+2.3% Y-o-Y) due to Haussimont’s integration (8,600 tons sold in the quarter, equivalent to 2% of the volumes sold)

• Co-products: lower gluten sales (-1.8% Y-o-Y), in line with the reduction in cereal grinding

17

Cereal Grinding (‘000 t)

Starch & Sweeteners Sales (‘000 t)

Co-products Sales (‘000 t)

-2.2% YoY +2.3% YoY -1.8% YoY

739 720 678

710 723

Q1

11

/12

Q2

11

/12

Q3

11

/12

Q4

11

/12

Q1

12/1

3

440 424

392

433 450

Q1

11

/12

Q2

11

/12

Q3

11

/12

Q4

11

/12

Q1

12

/13

Starch & Sweeteners – Q1 Financials Benefits from perimeter increase and price adjustments

Key Figures

In R$ Million

Q1

2012/13

Q1

2011/12 Change

Revenues 797 694 15%

Gross Profit 177 126 41%

Gross Margin 22,2% 18,1%

EBITDA 74 36 106%


Adjusted EBITDA 74 51 44%


CAPEX 77 32 138%

18


+14.8%

Revenues: +14.8% • Due to higher prices (+6% in local currency) and integration of Haussimont & Syral Halotek in the perimeter (R$12.7

million)

Adjusted EBITDA: R$74 million, up R$23 million

• Back to normal EBITDA margin after a first quarter 2011/12 with expensive raw material and compressed margins

• Financial instruments: R$0.3 million

CAPEX: R$77 million allocated for starch project in Brazil and diversifications in Europe

694

797

+66 +9 +27 +1

Q12011/12

Currency Volume Price &Mix

Others Q12012/13

115 110 109 134

110

40 26

62 61

70

Q1

11

/12

Q2

11/1

2

Q3

11/1

2

Q4

11

/12

Q1

12

/13

Trading Own Sales

156 136

171 195

180

Alcohol & Ethanol - Production and Sales Slight increase in volumes sold helped by ethanol trading

Cereal grinding: 209,000 tons -4.3% vs. Q1 2011/12

• 7 stoppage days at BENP Lillebonne plant in order to connect the new gluten production line and for maintenance (-20,000 tons of cereals grinded)

• Positive impact of Selby start-up (4% of the quarter’s volume)

Sales volumes

• Alcohol & Ethanol: 15.4% increase, sales from beet ethanol (Tereos) compensating for the drop in own ethanol sales

• Co-products: lower co-product sales, linked to lower production in Lillebonne (7 days stoppage)

19

Cereal Grinding (‘000 t)

Ethanol & Alcohol Sales (‘000 m3)

Co-products Sales (‘000 t)

-4.6% YoY +15.4% YoY -11.8% YoY

219 218 220 214 209

Q1

11

/12

Q2

11/1

2

Q3

11/1

2

Q4

11

/12

Q1

12

/13

68 59

66 62 60

Q1

11

/12

Q2

11/1

2

Q3

11/1

2

Q4

11

/12

Q1

12

/13

Ethanol own sales 57%

Ethanol traded 33%

Co-products and other

10%

262 322

+25 +34

0 +1

Q12011/12

Currency Volume Price & Mix Others Q12012/13

Alcohol / Ethanol Europe – Q1 Financials

Alcohol & Ethanol sales: 110,000 m3 + 70,000 m3 from Tereos trading

Gross profit: R$38 million and 11.8% margin

CAPEX: R$77 MM mainly allocated for the gluten project at BENP Lillebonne

Adusted EBITDA margin excluding trading would be 12.7%

20


+22.5%

Revenue Breakdown by Product

Key Figures

In R$ Million

Q1

2012/13

Q1

2011/12 Change

Revenues 322 263 +23%

Gross Profit 38 69 -45%

Gross Margin 11.8% 26.3%

EBITDA 27 40 -31%


Adjusted EBITDA 27 40 -31%


CAPEX 77 42 +85%

Cash Flow, Debt Position

AdjustedEBITDA

Adjustments EBITDA Depreciation &Amortization

OperatingIncome

Net FinancialExpenses

Net IncomeBefore Tax

Income Tax Share of Profit inAssociates

Net Income Minority Interest Net IncomeGroup Share

22

156

From Adjusted EBITDA to Net Income – Q1 2012/2013

(6)

150

(163) (13)

(79)

+16 +0 (46)

(76) (92)

+31

Impact of FX: -R$36 million (weaker BRL vs USD and EUR)

Higher depreciation due to longer intercrop period at Guarani (-R$22.3 million, Y-o-Y)

Cash Flow

In R$ Million Q1 2012/13(1)

Adjusted EBITDA 156

Working capital variance (92)

Other operating (including income tax paid) (50)

Operating Cash Flow 14

Financial interests (63)

Dividends paid and received (48)

Capex (369)

Increase in capital 370

Others 19

Free Cash Flow (77)

Forex impact (185)

Acquisition & Perimeter impact (32)

Net debt variation (294)

23

Q1 Cash Flow Reconciliation Capital Increase to Fund Cereal Expension and Diversification

100% contribution to

increase in capital (R$370

million)

Main CAPEX:

Brazil: R$154.4 million

Cereals: R$153.9 million

Indian Ocean: R$37.2 million

(1) Including increase in capital of R$370 million.

Debt 9.5% increase mostly due to currency effect

Net Debt / Adjusted EBITDA: 3.7x vs 3.2x in March, 2012

Currency impact due to the strengthening of USD and Euro

against Real: R$261 million

24

Gross Debt Breakdown by Currency

Leverage (R$ MM) (Net Debt/ Adjusted EBITDA)

Debt

In R$ Million

June 30, 20121

March 31, 2012

Change

Current 1,578 1,291 287

Non-current 2,550 2,384 166

Amortized cost (24) (25) 1

Total Gross Debt 4,103 3,650 453

In € 1,540 1,402 138

In USD 1,846 1,652 194

In R$ 677 557 120

Other currencies 65 64 33

Cash and cash Equivalent (792) (624) (168)

Total Net Debt 3,311 3,026 285

Related Parties Net Debt 22 17 5

Total Net Debt + Related Parties

3,333 3,043 290

Real 16%

US Dollar 45%

Euro 37%

Others 2%

3.001

2.293

2.150

2.498

3.084

3.223 3.043

3.333

4.8x

3.0x

2.5x 2.6x

3.3x 3.4x 3.2x

3.7x

0

500

1000

1500

2000

2500

3000

3500

2

4

6

08/09 09/10 10/11 Q111/12

Q211/12

Q311/12

Q411/12

Q112/13

(1) Net debt as at June 30th 2012 restated including increase in capital of R$370 million.

Outlook

Sugarcane

Brazil: increase in crushing estimative

• Rain impact on production to be compensated during the crop

• Investments in planting for the last 2 years combined to more favorable

weather : increase in crushing forecast for 12/11 up to 18.2 million tons

(+10.3% above 11/12)

Indian Ocean: favorable pricing environment for our products

• Mozambique: increase in production due to more sugarcane availability

• Réunion Island: stable crushing

Cereals:

Europe: multi-products facilities and niche markets

• Gluten production and dextrose project in BENP Lillebonne and cogeneration

and specialties in Zaragoza

Emerging Markets: Greenfields projects underway

• Brazil: Syral-Halotek corn plant pilot test schedule for Q4 2012/13

• China: JV with Wilmar established, first project under construction

26

Outlook

27

Investor Relations

Phone: +55 (11) 3544-4900

[email protected]

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Technology

Tereos apresentacao 1_t13_eng