2. EBITDA and EBITDA Margin
EBITDA and EBITDA Margin
R$ millions and % of the Net Revenue Adjusted EBITDA grew 10%,
mainly due to the higher sales in
the domestic market (nonwovens)
37.0 and the reduction in COGS.
30.7
28.7% Growth should have been even
26.3
23.9 better, had it not been impacted
26.4%
24.4% by:
21.7%
• the one-time reduction in sales
abroad on account of the more
severe winter in South America;
• Lower production and sales of
PVC related to unscheduled
2Q06 4Q06 1Q07 2Q07 maintenances.
3. Sales Volume
SALES VOLUME (tons)
12.7
12.0 12.1 12.6 • The Company has been
gradually expanding its sales
volumes, particularly in the
nonwovens segment.
7.0
6.4
5.6 • PVC production and sales
5.0
were affected by unscheduled
maintenance
0.7 0.5 0.4 0.6 • We will limit sales to the
public sector, whose margins
3Q06 4Q06 1Q07 2Q07 are smaller.
Nonwovens Tubes and Connections Packaging
4. Gross Revenues
Gross Revenues
R$ millions
143.0
130.1
121.6 • In the domestic market,
118.0
44.9 nonwovens posted a 6.4% sales
39.3 growth
41.8 36.9
• Nonwovens exports revenues fell
98.1 as a consequence the Brazilian
90.7 Real appreciation in relation to the
79.8 81.1 US dollar
• The lower PVC sales negatively
impacted this quarter’s results
2Q06 4Q06 1Q07 2Q07
Domestic Market Exports Market
5. Cost of Goods Sold
COGS / COGS MARGIN
74.8%
74.4%
73.5%
• The continued reduction
in COGS has been
improving our operating
88.2 efficiency and guaranteeing
86.8
69.9% greater operating margins
81.9
79.1
3Q06 4Q06 1Q07 2Q07
COGS MARGIN
6. Operating Expenses
Operating Expenses and Financial Results
R$ millions
2Q07 1Q07 % • R$ 2.5 million - Expenses related to the
acquisition;
-Administrative Expenses (12.7) (6.3) 102.3% • R$ 0.7 million - IPO-related expenses;
• R$ 1.9 million - Price Adjustment, owed
to former shareholders in compliance
with the contract of purchase and sale;
• R$ 1.0 million - Non-recurring
expenses with personnel restructuring,
labor and civil claims contingencies.
• Interest on the debt contracted for
-Financial Result, net (17.5) (9.9) 77.6% financing the acquisition of the
Company (promissory notes)
7. Net Income
Net Income
R$ million
• A combination of non-recurring
expenses and financial charges was
responsible for the loss recorded in the
quarter
31.1
• Financial expenses will be reduced as
of the 3rd quarter, due to the new debt
position.
9.8 9.7
(9.2)
2Q06 4Q06 1Q07 2Q07
8. Net Debt
Composition of the Net Debt
R$ millions
Current
(R$ Million) 06/30/07 After IPO
Total Debt
Financing of the Acquisition plus interest 499.5 -
Isofilme Acquisition 97.0 73.6
Financing of Machine 09 70.4 70.4
Promissory Notes II 250.0
666.9 394.0
Cash 57.0 57.0
Net proceeds from the IPO - 170.31
Net Debt 609.9 166.7
Net Debt/ EBITDA LTM2 5.8x 1.6x
1 Based in EBITDA LTM of R$ 105 million, as of march 31, 2007
2 Preliminary Offering of R$ 451,7 million (net), less R$ 255,0 million related to the Promissory Notes and R$ 26.4 million from the
payment of Isofilme
9. Operating Highlights
• Conclusion of Machine 09 financing; civil works finished and on-going
assembly process;
• Acquisition of Isofilme;
• New ERP (SAP) recently contracted – fully operational by the end of 1Q08;
• Sales department restructuring;
• Our IPO was successfully concluded, what was a critical step to reduce net
debt and prepare the Company for future acquisitions.
10. IR Contact
Rubens Sardenberg
IR Officer
Phone: 55 (41) 3381-7600
Fax: 55 (41) 3283-5909
São José dos Pinhais – PR
rubens@providencia.com.br
www.providencia.com.br/ri
The words “believe”, “anticipate”, “expect”, “estimate”, “will”, “plan”, “may”, “intend”, “foresee”, “project”, and other similar expressions, are intended to indicate forward-looking
statements. Such forward-looking statements involve uncertainties, risks and assumptions, since they include information related to our possible or presumed future operating
results, business strategy, financing plans, competitive position in the market, sector environment, potential growth opportunities and the effects of future regulations and
competition. In addition, forward-looking statements refer only to the date on which they were made and should not be taken as a guarantee of future performance. Providência is
under no obligation to update this presentation in the light of new information and/or future events
