1. Localiza Rent a Car S.A.
2Q06 – Public Meeting
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2. The car rental market > US$ 30 BL
USA EUROPE
USA EUROPE
• traded US$ 19 billion (2005) • Traded around US$ 11 billion
growth estimate of 3.6% p.a (2005)
(2004 and 2009) growth estimate of 2.8% p.a.
92% of the consolidated market (2004 and 2009)
(2004) 72% of the consolidated
50% of the revenue is from market (2001)
airports 33% of the revenue is from
airports
BRAZIL
BRAZIL
• Traded around R$ 2.91 billion
(2005)
historical average growth of 12%
p.a. (2000 and 2005)
33% of the consolidated market
(2005)
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3. Overview of the rental car industry
Car makers exit and entrance of private equity funds:
Sale of Hertz by Ford
Sale of Europcar by Volkswagen
Access of capital market (USA):
Avis – senior notes and floating rate notes
Hertz – IPO
New players in the Brazilian fleet rental market:
ALD – Societe Generale
ARVAL – BNP Paribas
Brazilian car rental market under consolidation process
Increase of new cars prices, in line with inflation
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4. Recent Achievements – 2Q06
67th stock of IBrX – Brazilian index
Best IR performance on IPO (IR Magazine Awards 2006)
Best car franchiser in Brazil in 2006 (“Pequenas Empresas, Grandes Negócios”
Magazine)
One of the 50 most admired HRs in Brazil (Gestão and RH Editoras’s research)
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5. Integrated business platform
127 agencies
12,584 cars
19,650 cars
Synergies:
cost reduction,
cross selling,
bargaining power
195 agencies 15 points of sale
in 8 countries 79% sold to final
consumer
7,004 cars
In 1H06: 12 new own agencies and 2 new used cars points of sale
In 1H06: 12 new own agencies and 2 new used cars points of sale
4

6. Competitive advantages
Bargaining
Gains of scale
Power
Strong brand
Geographical distribution
Integrated platform
Yield management
Know-how
IT
More
Market share
competitiveness
increase
5

7. Growth Opportunities
GDP
elasticity
Consolidation Air Traffic
Fleet outsourcing Credit cards
Replacement
6

8. Strategies
Short-term:
Maintain profitability
(Net margin, ROE and EBITDA margin)
EVA
Long-term:
Increase business volume through organic growth and the
opening of new agencies, leveraging on growth and
consolidation opportunities and obtaining gains of scale
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9. Localiza Rent a Car S.A.
2Q06 Results Presentation
(R$ million - USGAAP)
8

10. 2T06 Highlights
68.4% utilization rate in car rental.
43.3% increase in car rental business volume
33.7% increase in fleet rental business volume
63,7% increase in car rental EBITDA (excluding used cars segment)
44.5% increase in fleet rental EBITDA (excluding used cars segment)
67th stock in IBrX – Brazilian index
Highest profitability among stocks of Novo Mercado in 2Q06 (source: Economática)
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11. Car rental performance
(R$ million, USGAAP)
Daily rentals (thousands) Net revenue
641
3,411 370
410
347
2,413 213
1,839 192
43% 154 162
1,059
740 271 83
35%
96
197
155
79
58
2003 2004 2005 2Q05 2Q06 2003 2004 2005 2Q05 2Q06
EBITDA Net income
179
78
53
117 53
1,1
33
72 80
31
36 64% 39 17 64% 24
19 126 52
84 34
4 2.5
15 24
53
15
35
21
(0.3)
(2.9) (2.3)
2003 2004 2005 2Q05 2Q06
2003 2004 2005 2Q05 2Q06
Car Rental
Used Cars
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12. Fleet rental performace
(R$ milion, USGAAP)
Daily (millions) Net revenues
227
218
179
3,351 78
3,119 90
2,806 59
72
34% 47
149
1,022 128 35%
120 25
765 12
47
35
2003 2004 2005 2Q05 2Q06 2003 2004 2005 2Q05 2Q06
EBITDA Net income
103 27
90 8
37
36
78 7
4
63
95 45% 33 57 16
83 51
74 23 14 48%
1
1
23
32 16
22
(1,6) (6,7)
2003 2004 2005 2Q05 2Q06 2003 2004 2005 2Q05 2Q06
(14,8) (19,8) (35,7)
Rented cars
Used cars
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13. EBITDA margin per segment
(R$ million, USGAAP)
2003 2004 2005 2Q05 2Q06
Margin Margin Margin Margin Margin
44.1%
Rentals 34,3% 42.6% 46.3% 36.4%
Car rental
5.3%
Used car sales 9.7% 15.3% 14.4% 15.5%
24.2%
TOTAL 20.7% 28.4% 27.9% 23.1%
68.2%
Rentals 61.2% 65.2% 63.6% 63.8%
Fleet rental
5.6%
Used car sales 7.3% 8.2% 10.5% 10.8%
46.2%
TOTAL 43.4% 41.7% 45.3% 50.1%
53.1%
Rental 46% 51.5% 52.5% 46.6%
Consolidated
5.4%
Used car sales 9.2% 13.2% 13.7% 14.6%
54.5%
Franchising 43.6% 41.5% 47.6% 29.4%
31.2%
TOTAL 28.6% 33.1% 32.6% 29.4%
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14. Consolidated Performance
(R$ milion, USGAAP)
Net revenue
Daily rentals 869
6,762
5,219
4,959 628
448
527
38%
303
16%
251
2,082 233
1,504 201
421 35% 108
325 108
276
125
93
2003 2004 2005 2Q05 2Q06
2003 2004 2005 2Q05 2Q06
Net income
EBITDA 286
61
210 107
91
40
152
69
23
31%
24%
225
74 41
60 31
170
6
129
16
68
44
2003 2004 2005 2Q05 2Q06 2003 2004 2005 2Q05 2Q06
Margin 13.0% * 14.3% 12.2% 15.4% 17.4%
Pro forma result disregarding mark-to-market (MTM) of derivatives contracts
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15. Net income evolution
(R$ million, USGAAP)
EBITDA variation = + 14 million
Other itens variation = - 4.4 milion
Rental = + 24 million
Used car sales = - 10.9 milion
Revenues Costs
+32.9 -18.5
-0.1
-8.7
SG&A
+33.0 -9.8
-0.3
-1,0
-1.1 Stock
Interest
Depreciation
Option Taxes
+0.8 +7.4
-7.6
-0.8 -3.5
+30.7%
31.3 40.9
Net Income Net Income
2Q05 2Q06
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16. Cash flow
(R$ million, USGAAP)
81.2
Cash and cash Cash and cash
50.5
equivalents equivalents
1Q06: 2Q06:
69.2 191.1
-9.8
Financing
Operational Investment
activities
activities activities
• Strong cash generation from operational activities
• Strong cash generation from operational activities
• Funding from follow-on shares offering proceeds
• Funding from follow-on shares offering proceeds
• Low net investment in fleet
• Low net investment in fleet
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17. Indebtedness
(R$ million, USGAAP)
Net debt (R$ million) USGAAP
539
366.7 272.5
281
87
2003 2004 2005 2Q05 2Q06
2003 2004 2005 2Q05 2Q06
Net debt / fleet 22% 46% 60% 51.2% 32%
Net debt / equity 0.36 0.96 1.37 1.03 0.46
Rating S&P - BrA / Positive outlook
The Company is prepared to a new growth cycle
The Company is prepared to a new growth cycle
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18. Fleet : investment and growth
(R$ milion, USGAAP)
Investment - (R$ million, USGAAP) Quantity - thousand
690
26,1
493 22,2
448 18,8
15,5 15,1 15,7
303
251 288 232 9,3
108 121 4,6
108 4,2 4,2
2003 2004 2005 2Q05 2Q06 2003 2004 2005 2Q05 2Q06
Purchases
Sales
Net investment Fleet growth (thousand)
2003 2004 2005 2Q05 2Q06 2003 2004 2005 2Q05 2Q06
37 190 242 124 -0.4 +6.2 +7.3 +4.7
13 0
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19. Value Added to the shareholder
R$ / thousand
29.3%
24.1%
24.6% ROIC
22.0%
24.1%
18.4%
Nominal WACC
15.8%
12.9%
1,781 44,486 81,229
57,384
2003 2004 2005 1H06
ROIC
EVA Nominal WACC
2003 2004 2005 1H06 Change
Average Price per car R$ 16.4 18.6 23.4 25.9 +57.9%
IPCA (Brazilian inflation index) 9.3% 7.6% 5.75% 1.5% +26.2%
Average CDI (Brazilian interbank rate) 23.3% 16.2% 19.0% 15.6% -7.7 p.p.
Brazil risk 8.4% 5.4% 4.0% 2.5% -5.9 p.p.
Real WACC (excluding inflationary 14.3% 10.9% 10.5% 9.2% -5.1 p.p.
effects
In the last 3 years, the spread between ROIC and WACC presented low volatility
In the last 3 years, the spread between ROIC and WACC presented low volatility
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20. ROE – Return on equity
38.9%
38.6%
40,0%
36.7%
30.8%
30,0%
20,0%
2003 2004 2005 2006
(estimated)
2006 ROE may be higher than 30%, despite the R$150 million capital increase
2006 ROE may be higher than 30%, despite the R$150 million capital increase
OBS: the year of 2006 was annualized based on the results of 1H06, already considering proceeds from the primary offer.
ROE was calculated dividing net income by the current year’s average equity, not considering the profit of the year itself.
It was not considered the mark-to-market of derivative contracts in 2003 net income.
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21. Performance RENT3
RENT3 X IBOVESP A
06/30/06
41.5 120
50 12/31/05
28.63
45 100
40
80
35
60
30
25
40
20
20
15
10 0
Volume RENT3 RENT3 IBOVESPA
Average daily volume traded in 2T06 R$ 15.1 MM
Performance RENT3 2Q06: + 13% X IBOV 2Q06: -3%
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22. Perspectives
Minimum utilization rate of 65% in car rental business
35% increase in car rental business volume
25% increase in fleet rental business volume
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23. Disclaimer – Information and Projections
The material that follows is a presentation of general background information about LOCALIZA as of the date of the presentation. It is information
in summary form and does not purport to be complete. It is not intended to be relied upon as advice to potential investors. No representation or
warranty, express or implied, is made concerning, and no reliance should be placed on, the accuracy, fairness, or completeness of the information
presented herein.
This presentation contains statements that are forward-looking within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of
the Securities Exchange Act of 1934. Such forward-looking statements are only predictions and are not guarantees of future performance.
Investors are cautioned that any such forward-looking statements are and will be, as the case may be, subject to many risks, uncertainties and
factors relating to the operations and business environments of LOCALIZA and its subsidiaries that may cause the actual results of the companies
to be materially different from any future results expressed or implied in such forward-looking statements.
Although LOCALIZA believes that the expectations and assumptions reflected in the forward-looking statements are reasonable based on
information currently available to LOCALIZA’s management, LOCALIZA cannot guarantee future results or events. LOCALIZA expressly disclaims
a duty to update any of the forward-looking statement.
It is not allowed to offer or sell in the United States securities not registered or exempted from registration, in accordance with the Securites Act of
1933. Any securities offering to be conducted in United States must be made through an offering memorandum, which can be obtained with the
underwriters. The offering memo must contain or include reference to detailed information about LOCALIZA and its business and financial results,
in addition to its financial statements.
This presentation does not constitute an offering, invitation or offering request or acquisition of any type of
securities. Neither this presentation nor anything here included represent the terms of a contract or
commitment of any kind.
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24. Thank You!
Investor Relations Localiza:
www.localiza.com/ri
phone: +5531 3247-7039
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