3. Successful integration of recent acquisitions
• Operating the largest integrated cluster in São Paulo state after Mandu and Vertente acquisitions
• Sole producer in La Réunion following GQF acquisition
Recent operational achievements
• Optimization of starch plants: stable volumes in Syral after closure of Greenwich plant
Tereos Internacional - Strategic Highlights
3
• Optimization of starch plants: stable volumes in Syral after closure of Greenwich plant
• Increased sugar production capacity in Brazil: successful start-up of Tanabi’s sugar factory and
expansion in São José and Cruz Alta plants
• Start-up of Andrade’s cogeneration facility
Tereos Internacional is well positioned to address a new industry landscape and
implement our long-term growth strategy
4. Tereos Internacional - Q2 Financial Highlights
Solid revenue growth: R$1.5 billion
• Year-on-Year: + 12.5% (+ 26.7% at constant currency)
Adjusted EBITDA* : R$286 million
• Year-on-Year: + 44.3% (+ 70.1% at constant currency)
Sugarcane
4
• Strong revenue growth: R$744 million (+ 82.5% year-on-year) driven by acquisitions, higher sugar
production and favorable market conditions
• Guarani Adjusted EBITDA margin up to 30.9% from 11.5% improved by organic growth and
acquisitions
Cereal
• Stable revenue: R$751 million (+ 1.6% vs. Q1 2010/11), despite closure of Greenwich site
• Syral Adjusted EBITDA margin down to 9.5% from 16.2% impacted by higher cost of goods sold
* Adjusted EBITDA : EBITDA excluding non recurring items, accounting effect of the adjustment in the fair value
of the biological assets and financial instruments
5. Q2 Market Highlights
Sugar
Raw sugar prices (NY#11) increased by 40% in the quarter ended September 30, 2010,
driven by lower than expected production and strong demand on low world stocks
Brazil: yields to be affected by dry weather
Starch
Wheat prices increased by 52% in the quarter ended September 30, 2010, driven by
5
Wheat prices increased by 52% in the quarter ended September 30, 2010, driven by
drought and fires that struck the Black Sea countries
Starch & Sweeteners: next negotiation season (Q3/Q4) to reflect increase in cereal and
energy prices, as well as sustained demand and tight spare capacity in Europe
Ethanol
Ethanol prices rose (US: + 27% - Brazil: + 24% for hydrous - EU: + 28%) due to tight
supply-demand balance
7. 591
741
116
18
15
355 613
35
Revenues - Q2
In R$ MM
1,498+12.5%
1,332 1,332
(149)
1,498
Brazil
La Réunion
Mozambique
Starch Europe
Ethanol Europe
Solid growth in Revenues, driven by acquisitions, higher sugar
production and favorable market conditions
+ 240
+ 74
Q2 2009/10 Q2 2010/11
7
20 160183
Q2 2009/10 Currency Volume Price & Mix Q2 2010/11
Total Holdings
Sugarcane
• Brazil: +73% mainly due to the contribution of Mandu and Vertente, increase in sugar production (+
83%) and higher prices
• La Réunion: contribution of GQF that doubled the revenues, return to normal operating conditions
in Bois Rouge
Cereal
• Starch Europe: - 6.1% at constant exchange rate. Stable volumes after Greenwhich closure
• Ethanol Europe: + 2.8% at constant exchange rate
8. An improved Ajusted EBITDA margin
EBITDA - Q2
In R$ MM
61
121
29
6
139
51
+1.4%
223
226
26
Brazil
La Réunion
Mozambique
Starch Europe
Ethanol Europe
In R$ MM
120
29
10
6
189
41
+44.3%
198
286
12
Adjusted EBITDA - Q2
8
Q2 2009/10 Q2 2010/11
-6
0 719
61
-4
Total Holdings
-6
0 719
56
Q2 2009/10 Q2 2010/11
Sugarcane
• Brazil: Adjusted EBITDA margin of 30.9%,
• La Réunion: Adjusted EBITDA margin of 25%
Cereal
• Starch: Adjusted EBITDA margin of 9.5%
Ethanol: Adjusted EBITDA margin 4.4%
Adjustments : R$59.8 million, including Biological Assets (R$36 million), Financial Instruments
(R$20.8 million) and discontinued operations (R$3 million)
9. From Adjusted EBITDA to Net Income
Q2 2010/11
286
In R$ MM
226
(60)
Discontinued operations: -R$3 MM
Fair value of biological assets: -R$36 MM
Fair value of financial instruments: -R$21 MM
Mainly Mandu and Vertente : -R$32.6 MM
And GQF: -R$13.9 MM
9
63
(43)
233
(41) (18) (1) (19)
(163)
Syral: -R$15.5 million
Guarani (+Mozambique): -R$27.3 million
Adjusted
EBITDA
Depreciation
&
Amortization
Operating
Income
Net Financial
Expenses
Associates Net Income
Before Tax
Income Tax Net Income Minority
Interest
Net Income
Group Share
EBITDAAdjustements
Gain & Losses on Forex: +R$1 MM
Fair-value: +R$4 MM
10. Debt
Debt
In R$ Million
Sep 30, 2010 Jun 30, 2010 Change
Current 1,667 1,598 + 4.3%
Non-current 1,236 1,001 + 23.5%
Amortized cost (16) (9) + 272.8%
Total Gross Debt 2,887 2,590 + 11.5%
In € 1,388 1,245 + 11.5%
In USD 757 424 + 78.5%
In R$ 703 857 - 18.0%
Other currencies 55 73 - 24.7%
Cash and cash Equivalent (440) (382) + 15.2%
Total Net Debt 2,447 2,208 + 10.8%
Real-
denominated
24.2%
Other
currencies
1.9%
Gross Debt
Breakdown by currency
10
Total Net Debt 2,447 2,208 + 10.8%
Related parties net debt (31) (6) + 416.7%
Total Net Debt + Related parties 2,416 2,202 + 9.7%
Net Debt: R$2,416 million + 9.7% vs. June 2010
• In line with seasonal increase in working capital and recent acquisition needs
Net Debt / EBITDA: 3.4x
US
Dollar-
denominated
26.1%
Euro-
denominated
47.8%
11. Cash Flow
Cash Flow
In R$ Million
Q2 2010/11
Adjusted EBITDA 286
Working capital variance (197)
Other operating (6)
Operating Cash Flow 82
Financial interests net of dividends paid and received (50)
Capex net of proceeds from the disposal of assets (70)
Capex (104)
Proceeds from the disposal of assets 35
Cash Flow before acquisition and capital increase (37)
11
Total net debt increase: R$214 million vs. June 30, 2010
• Working capital variance: seasonality impact in Brazil and Indian Ocean
• Acquisition and scope impact: Mandu and GFQ
Cash Flow before acquisition and capital increase (37)
Acquisition & Perimeter impact (128)
Capital increase 0
Free Cash Flow (165)
Forex impact (49)
Total net debt 214
22. Outlook - Short Term
Sugar
Market: world stocks at very low levels – Brazil: tight supply, lower-than-expected increase in sugar
production in Center-South
Solid margins in a positive environment despite a reduction in the expected crushing from 20.3 million
tons to 20 million tons
Starch
Wheat, Corn: world stocks estimated to be sufficient to meet demand levels
Corn: lower yields may cause increase in near term corn prices. Company’s hedging policy to reduce
impacts of cereal prices increases
Progressive return to normalized Starch & Sweeteners margins. Favorable drivers for future contract
22
Progressive return to normalized Starch & Sweeteners margins. Favorable drivers for future contract
negotiations (Q4):
• Increased structural demand
• Tight supplies
• Lack of availability of large volumes in some markets
Ethanol
Market: solid prices as more sugarcane is diverted to sugar and as increased corn and wheat prices
Improved margins, driven by first premium alcohol volumes delivered by DVO and recovery in
industrial performance in Lillebonne
First deliveries of the 2.2 MM m³ ethanol agreement with Petrobras and improved mix
anhydrous/hydrous
23. Outlook - Medium Term
Sugarcane activities
• Brazil – Cogeneration: 2 energy contracts representing an average of 55.7 MW awarded to
Guarani for the 2013/14 crop for Mandu and São José plants
• Continued high sugar and ethanol prices for the Brazilian sugarcane operations, despite a
reduced crop in Brazil
• Continued contributions from recent acquisitions in Brazil and La Réunion
Cereal activities
23
Cereal activities
• Ethanol – Gluten: investment plan approved for the improving Lillebonne product mix by
producing gluten alongside ethanol in the plant
• Normalized gross margins for the European cereal operations in the final quarter
Tereos Internacional is well positioned to address new industry landscape and
implement its long-term growth strategy
