2. Forward-looking Statements
This presentation contains forward-looking statements. Such statements are not
statements of historical facts, and reflect the beliefs and expectations of
Braskem’s management. The words “anticipates”, “wishes”, “expects”,
“estimates”, “intends”, “forecasts”, “plans”, “predicts”, “projects”, “targets”
and similar words are intended to identify these statements. Although Braskem
believes that expectations and assumptions reflected in the forward-looking
statements are reasonable based on information currently available to Braskem’s
management, Braskem cannot guarantee future results or events.
Forward-looking statements included in this presentation speak only as of the
date they were made (June 30, 2009), and the Company does not undertake any
obligation to update them in light of new information or future developments.
Braskem shall not be responsible for any transaction or investment decisions that
are taken based on information included in this presentation.
2
3. Agenda
The Company & 2Q09 Financials
Petrochemical Industry
Key Differentiators
3
3
4. Braskem in a snapshot
Leading petrochemical company in Latin America
Third largest resins producer in the Americas
Diversified portfolio of petrochemical products, with
focus on PE, PP and PVC
18 facilities plants in Brazil and annual production
capacity of 11 million tons of chemical and
petrochemical products
Key financials, 2008
Gross revenue = US$ 12.8 billion
Net revenue = US$ 10.0 billion (78% in Brazil)
EBITDA = US$ 1.3 billion
Assets = US$ 9.7 billion
Listed at BM&F Bovespa, NYSE and LATIBEX
100% tag along
4
5. Ownership Structure – Leveraging relationship
with Petrobras
% Voting Capital % Total Capital
ODEBRECHT GROUP PETROBRAS BNDESPAR OTHERS
62.3% 38.3% 31.0% 25.3% 0.0% 5.1% 6.7% 31.3%
Leveraging relationship with Petrobras: NOC alliance
• Potential for operational synergies with refineries and partnership
with Petrobras R&D Center
• Alliance to strengthen Brazil’s petrochemical value chain
– Consolidation around 2 large competitors (Braskem & Quattor)
– Access to competitive raw materials
– Improved value chain competitiveness
• Corporate governance standards: Shareholders’ agreement
5
7. Track record of strong and consistent organic
growth and acquisitions
Rank amongst the 10
Become the largest largest petrochemical
thermoplastic resins companies in the world
producer in Latin measured by EV*
America
Triunfo
Paulinia
IPQ / CPS
Politeno 2009
2012
Polialden 2007 2008
2006
Trikem
2002
6,113
5,901
5,551
Braskem’s Ethylene and
resins capacity (kt) 23% CAGR
3,621
3,045 3,145 3,225
1,734
Acquisitions
Organic growth
2000 2002 2004 2005 2006 2007 2008 2009 * Enterprise Value 7
8. Applied Innovation and technology to strengthen
value chain competitiveness
Structured resource base to support client
needs Focus on product and
application
development
Over US$ 190 million in R&D assets
– 18% of resin sales
derive from
> 170 researchers products developed
in the last three
years
8 pilot plants – Focus on clients’ end
users
> 240 patents filed
worldwide Targeted initiatives
for breakthrough
technology
Partnership with universities and R&D centers in – Intelligent
Brazil and abroad packaging
– Renewables
8
Source: Braskem 8
9. Growth combined with
improved competitiveness
Green PE:
− Cornerstone laid for its green ethylene plant in April/09
− Investments of R$488 million and startup expected for the end of 2010
− Financing package with BNDES approved in May/09
Venezuela:
Polipropileno del Sur (Propilsur)
- Basic engineering and front end engineering design (FEED) concluded
- Program timetable altered: startup in 2013 and investments estimated at US$ 1.2 billion
Polietilenos de America (Polimerica)
- Technology license agreements signed for the PE plants
- Program timetable altered: startup in 2014 and investments estimated at US$ 3.25 billion
Peru:
− Braskem, Petrobras and PetroPerú concluded studies for the technical and economic pre-
feasibility phase of an integrated project to produce 700 kton to 1,200 kton of polyethylene using
the natural gas available in Peru as feedstock.
Source: Braskem 9
10. Global and Regional Scenario
Global Scenario
Oil price trend is still uncertain
− Economy recovery worldwide versus high inventory level
Naphtha prices reflect the volatility of crude
Petrochemical prices in the international market improved during 3Q09 but are expected to decrease for
the 4Q09
− Commissioning of new plants
− Lower demand from converters
− Resin’s spread expected to be attractive
− Higher operating rates compared to 1H09
Downturn cycle can last until 2011
Regional Scenario
Braskem plants operating at full capacity
Strong domestic demand during 3Q09 and favorable global scenario pressured prices upward
Real appreciation and operational problems with Quattor lead imports to pick up again
Inventory levels in the chain are still low
Sales volume recovery for Mercosur, Bolivia and Andean countries
− Low consumer confidence and reduced liquidity still hurting Argentina’s economy
Source: Braskem / CMAI / Quimax 10
14. March performance shows trends for the
upcoming quarter
Resins Sales Volume in the Domestic
3Q09 Trend in the Domestic Market
Market
Volume Price Revenue Cost
PP
PE
PVC
BTX
Dec-08
Oct-08
Jan-09
Feb-09
Jul-09
Nov-08
Apr-09
Jun-09
Aug-09
Sep-09
Mar-09
May-09
Source: Braskem 14
15. EBITDA
Higher basic petrochemicals prices and sales volume
overcome exchange appreciation and raw material cost increase
R$ million
FX Impact
247 on Costs
FX Impact
on Revenue (334)
539 65
( 232 )
( 96 ) 566
457 ( 87 )
( 57 ) ( 24 )
EBITDA Price Volume Raw Others FX Other Costs + EBITDA
1Q09 Material PIS/ Variable SG&A 2Q09
COFINS Costs
Source: Braskem 15
16. Comfortable cash position, covering
over 2 years of debt amortization
R$ Million (06/30/09)
Gross Debt:
Debt: 10,583 Net Debt / Ebitda (x) R$ Net Debt / Ebitda (x) US$
Net Debt:
Debt: 7,347
Average Term: 10.1 years
Term:
67% of the debt are pegged to the USD
3,236
1,468
PFICO 15%
13% 13%
12%
11%
11% 10%
9%
1,768 610 1,617 6%
1,326 1,288 1,209 1,372
1,091 976
526 615
06/30/09 2009 2010 2011 2012 2013 2014/ 2016/ 2018/ 2020 onwards
2015 2017 2019
In US$
Value related to the loan granted by a Petrobras subsidiary for the
In R$ delisting of Copesul, due in October 2009.
Source: Braskem 16
17. Agenda
The Company & 1Q09 Financials
Petrochemical Industry
Key Differentiators
17
17
18. Petrochemical Cycle:
Good naphtha x resins spreads even with lower ethylene
utilization rate
Global ethylene supply-demand and operating rate, Points of concern
Mton/y. %
146
143 • US/EU slowdown
140 127
134 • Incentives to sustain supply buildup
130 120
115 – China: import substitution
111 112
– Middle East own agenda
• Credit availability
87% • Change on petrochemical ownership
86%
84%
83%
82%
Supply & Demand
Balance
Potential positive factors
2008 2009 2010 2011 2012
• Frequent delays in new capacities
CMAI Utilization Rate May/09
1 2 3 Supply Demand
5
• Supply-demand geographical imbalance
Spread HDPE/Naphtha X Ethylene Utilization Rate leads to logistics barriers
91 91 • Increased economic importance of
702 717 emerging countries with relevant
751 750 688 694
84 domestic consumption
638 562 626 624 • China: raw materials less competitive
77 528
79
77 77 • Opportunities from assets on sale
474
• 12MMton of capacities temporarily
Jan-08 Mar-08 May-08 Jul-08 Sep-08 Nov-08 Jan-09 Mar-09 May-09 Jul-09 Sep-09 shutdown in USA and Europe
Spread HDPE/Naphtha US$/t Utilization Rate % Estimated Utilization Rate 3Q09 % Source: CMAI / Platts 18
19. 9% of the world ethylene capacity shutdown or idle
in USA and West Europe
Kton Expected utilization rate 2009(1):
45.000
87%
40.000 82%
76% 78%
35.000
30.000 • 12 MM tons of capacity lost
25.000
in USA and West Europe
20.000
15.000
(9% of world capacity) due
10.000 to idling, permanent
5.000
0
closures and maintenance
W.Europe N. America M. East Asia
stoppages, trigged by
Production Capacity Lost Operating Rate
Capacity lost = maintenance, technical or market losses economics and poor
demand.
New capacity 3.890
addition (kton): • New capacities additions are
1.145 2.158
expected to come on stream
452
during 2009 and 2010
4.040 4.033
2009 2010 (1)1H09
real data
Middle East Asia ex-China China Source: HSBC / CMAI 19
20. Agenda
The Company & 2008 Financials
Petrochemical Industry
Key Differentiators
20
20
21. Brazil: A stable economy
Structural changes have prepared the country to
the current environment
Economic policy based on inflation target, fiscal
responsibility and floating exchange rate GDP growth and inflation
%
% GDP
interest
Competitive, diversified and open economy 7 7
6 6
Liquid financial system
5 5
Mature democracy 4 4
3 3
Broad and consumerist domestic market 2 2
1 1
Greater competitiveness of Brazilian multinationals
0 0
2007 2008 2009 2010
Focus on improving social conditions (health, education, -1 -1
income distribution) GDP Inflation
Sovereign debt in a record low, rated investment grade
(S&P, Fitch)
Source: Tendências Consulting - Bradesco and Santander Perspectives (Sep/09) 21
22. Brazil: dynamic market with still low per capita
consumption
• PE, PP and PVC per capita consumption (Kg per person)
76
68
57
Brazil
5.2%
CAGR*
21.9
22.7
18.7 20.2
15.4 16.6 16.1 17.8 17.5 18.0
14.5 16.2
13.6
11.1 12.5
1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008
USA Europe Japan
PE PP PVC
22
Source: CMAI *Compound annual growth rate 22
24. … and a high level of consolidation
• Number of Producers • 2 Top producers share
13 100% 100%
93%
11
9
52%
42%
30%
2 2 2
PE PP PVC PE PP PVC
BRAZIL USA
24
Source: Braskem / CMAI 24
25. Braskem is prepared to seize the opportunities
offered by this environment
n
re atio
e c C
h valu
w wit Expand access to
G ro
attractive markets
B
Strengthen current position Assure regional
low-cost raw
A material and energy
supplies • Expansion of Green-PE
Increase and and renewable
protect core Latin • M&As
American business
• Global Alliances
• Gas crackers in Latin America
• Operational and commercial excellence
• Brazilian sugar cane ethanol
• Relationship with Petrobras
• Value-chain virtual integration
– Refineries and raw materials
– Logistics and services
– Innovation and technology
• Enhancement of aromatics and crackers’
products
• Regional leadership Source: Braskem 25
26. Focus
Continuous strengthening of long-term relationship with Clients
Priority over financial health and liquidity
Productivity Program: cost reduction
Support the sustainability of the Brazilian petrochemical chain
Construction of the Green PE plant
Projects in Venezuela
Analysis of opportunities arising from crisis: selective
acquisitions in North America
Operational renewal: over 500 employees by 2011
Greater operational and financial strength
26
29. PE Innovation: Cases of Success
Internally developed Pioneer on the production of
technology for the metallocene PE in Brazil
production of UHMWPE
Ideal product for kitchen cutting boards
Shrink Films and playground toys
Replacing paperboard boxes
Cisterns
PE replacing concrete
Bags for Bread
Replacing paper bags
29
30. PE Innovation: Cases of Success
Developments for truck liners:
High performance for Developments for
anti-stick properties and high abrasion
the frigorific market agricultural silo structure
resistance
30
31. PP Innovation: Cases of Success
BOPP sealant layer High clarity PP grades
for rigid packaging
Disposable glasses
Braskem product approved in replacing PS glasses
PP Replacing PS
high speed BOPP production lines.
31
32. PP Developments: Customer Partnership
Replacing steel in washing machine Partnership in new
developments packaging developments
32
33. Resins Capacity in the Americas
Capacity of resins in Latin America, kton
3,561
Brazilian
assets
1,895
722 692 521 438
Braskem* Quattor**Mexichem Dow Solvay Ecopetrol
Capacity of resins in Americas, kton
5,416
PVC
40
PP
400 PE
4,706
3,561
2.902
2,237 526
1,040 2,895
4,976 1,092
2,469 2,340
815 810
1,995
995 1,085
Dow Lyondell Braskem Formosa Ineos Shintech
Basell 3
3
* Includes Petroquimica Triunfo s plant
´
**JV between Unipar (60%) and Petrobras (40%). The production is segregated between 1,020 kt in PE and 875 kt in PP Source: CMAI 33
35. Financial highlights
Change Change Change
Main Economic 2Q09 1Q09 2Q08 1H09 1H08
% % %
Indicators (A) (B) ( C) (D) (E)
(D)/(E)
(A)/(B) (A)/( C)
Net Revenue 3,688 3,260 4,628 13 (20) 6,948 9,175 (24)
EBITDA 566 457 557 24 2 1,023 1,183 (14)
EBITDA Margin 15.3% 14.0% 12.0% 1.3 p.p. 3.3 p.p. 14.7% 12.9% 1.8 p.p.
Net Financial Result 1,192 (208) 386 - - 984 167 490
Net Income / Loss 1,156 10 404 - - 1,166 500 133
Source: Braskem 35
36. Revenues breakdown – 2Q09
Net Revenue by Product 1
(2Q09)
Others 10%
ETBE/MTBE 4%
Caustic Soda
3%
Solvents 1%
Butadiene 2%
Fuel 4% Resins 57%
BTX * 9%
Propylene 5%
Ethylene 4%
1
Does not include condensate processing and Ipiranga Quím ica sales
2
BTX - Benzene, Toluene, Ortoxylene and Paraxylene
36
37. COGS breakdown – 2Q09
1
COGS 2Q09
Fuel 1,6% Others 1,7%
Natural Gas 1,3%
Services 2,9% Naphtha /
Eletric Energy Condensate
6,3% 67,3%
Labor 4,6%
Deprec / Am ort
6,9%
Other Variable
Costs 7,3%
1
Does not include condensate processing and costs of Ipiranga Quím ica
sales
37
39. Outstanding Bonds & Outstanding Ratings
Coupon Yield *
Outstanding Bonds Maturity
(% p.a.) (% p.a.)
US$250 MM Jan/2014 11.750 5.5
US$250 MM Jun/2015 9.375 5.9
US$275 MM Jan/2017 8.000 6.8
US$500 MM Jun/2018 7.250 7.0
US$150 MM Perpetual 9.750 9.5
US$200 MM Perpetual 9.000 8.8
* As of September, 29th
Corporate Credit Rating – Global Scale
Agency Rating Outlook
Fitch Ratings BB+ Stable
S&P BB+ Stable
Moody’s Ba1 Stable
Source: Braskem / Bloomberg 39
40. Covenants
RATIO Net Debt / Ebitda (x)
Net Debt / EBITDA US$ R$
3.25
< 4.5X 3.16
Jun09 Jun09
Facility Amount Currency Type
2010 and 2011 Debentures R$800 MM R$ Incurrence*
2014 Medium Term Notes US$250 MM R$ Incurrence*
Nippon Export and
US$80 MM US$ Maintenance
Investment Insurance
EPP (Export Pre-Payment) US$725 MM US$ Maintenance
* The company is prevented from issuing any new debt for the period if it overcomes the 4.5x Net debt / Ebitda
ratio.
Source: Braskem 40
41. Focus on priority investment projects
R$ million
2,279
Investments in Equity Stake
885
(Ipiranga Group/Politeno)
Capacity increases /
195 Petroquímica Paulínia 909
238 Equipment Replacement
Health, Safety and Environment 172 Capacity increases / Green PE
161
91 Technology Equipment Replacement
213
202
Productivity
Health, Safety and Environment
203
14 Technology
407 Maintenance
74 Productivity
55 Information System
233 Maintenance / Others
45 Quality / Others
2008 2009e
Source: Braskem 41
