The Inspirational Story of Julio Herrera Velutini - Global Finance Leader
Institucional Presentation - December/15
1. 11
Localiza Rent a Car S.A.
The 25th most valuable brand in
Brazil.
December, 2015
Source: Interbrand
2. 1. Company overview
2. Main business divisions
Car Rental
Fleet Rental
Seminovos
3. Financials
Appendix: Earnings release 3Q15
Agenda
2
3. Company: milestones
Phase I – Rise to #1
1973 – Founded in Belo
Horizonte/MG
Late 70’s - Acquisitions in the
Northeast of Brazil
1981 – Brazilian car rental leader in
# of branches
Phase II – Expansion
1984 – Expansion strategy by
adjacencies: Franchising
1991 – Expansion strategy by
adjacencies: Seminovos
1997 – Expansion strategy by
adjacencies: Fleet Rental
1997 – PE firm DL&J enters at a
market cap of US$ 150 mm
Phase III – Reaching Scale
2005 – IPO: market cap of US$ 295
mm
2011 – Rated as investment grade by
Moody’s, Fitch and S&P in 2012
2012 – ADR level I
09/30/2015 – Market cap of about
US$1.3 bi with ADTV of US$8 million
1973 1982 1983 2004 2005 2014
3
4. Company: integrated business platform
Synergies:
bargaining power
cost reduction
cross selling
13,175 cars
176 locations in Brazil
67 locations in South America
42 employees
57.0% sold to final consumer
76 stores
45 cities
1,008 employees
71,114 cars
4.7 million clients
314 locations
4,580 employees
33,160 cars
826 clients
402 employees
This integrated business platform gives Localiza flexibility and superior performance.
Based on the 9M15 4
Car Rental Fleet Rental
SeminovosFranchising
5. 5
High fixed cost
Standard fleet
1 year cycle
High entry barriers
Gains of scale
Intensive capital
Consolidated in airport
market
Fragmented off airport
market
Support area
Reduces depreciation
Know How of used cars
market
Low dependence on
intermediates
Supplementary
business
Important for
distribution
High profitability
Low contribution in
results
Company: Business platform divisions
Car Rental
Rents to individuals and
companies at airports
and off airport locations.
Franchising
Contributes to expand
the Localiza’s network.
Fleet Rental
Outsources fleet for 2-3
years term contracts.
Used Car Sales
Sells the used cars mainly
to final consumers after
the rental and estimates
the residual values.
Low fixed cost
Customized fleet
3 years cycle
Low entry barriers
Intensive capital
6. 6
Net car sale
revenue
R$26.21 year cycle
Car Rental Division - 2014 Financial Cycle
Per car
R$27.8
Average car price
1 2 3 4 5 6 7 8 9 10 11 12Expenses, interest and tax
Revenue
Spread
9.5p.p.
Total
1 year
R$ % R$ % R$
Net revenues 20.9 100.0% 29.0 100.0% 49.8
Costs - fixed and variable (9.4) -44.9% (9.4)
SG&A (3.4) -16.3% (2.8) -9.6% (6.2)
Net revenues of car sold 26.2 90.4% 26.2
Book value of car sold (24.8) -85.6% (24.8)
EBITDA 8.1 38.7% 1.4 4.7% 9.5
Cars Depreciation (1.3) -4.4% (1.3)
Others depreciation (0.4) -1.7% (0.2) -0.6% (0.5)
Financial expenses (1.7) -6.0% (1.7)
Taxes (2.3) -11.1% 0.5 1.9% (1.8)
Net Income (Loss) 5.4 25.9% (1.3) -4.4% 4.1
NOPAT 5.3
ROIC (it considers the effect of the average book value of the car in its useful life) 17.5%
Cost of debt after taxes 8.0%
Car Rental Seminovos
Per car soldPer operating car
7. 7
Net car sale
revenue
R$24.4
3 year cycle
Fleet Rental Division - 2014 Financial Cycle
Per car
Spread
9.5p.p.
1 2 3 4 5 6 31 32 33 34 35 36Expenses, interest and tax
Revenue
R$33.3
Average car price
Total
3 years
R$ % Seminovos % R$
Net revenues 55.7 100.0% 26.9 100.0% 82.6
Costs - fixed and variable (18.6) -33.4% (18.6)
SG&A (3.7) -6.7% (2.5) -9.3% (6.2)
Net revenues of car sold 24.4 90.7% 24.4
Book value of car sold (21.2) -78.9% (21.2)
EBITDA 33.4 60.0% 3.2 11.8% 36.6
Cars Depreciation (12.6) -46.9% (12.6)
Others depreciation (0.1) -0.2% (0.1) -0.2% (0.2)
Financial expenses (4.4) -16.3% (4.4)
Taxes (10.0) -17.9% 4.2 15.5% (5.8)
Net Income (Loss) 23.3 41.8% (9.7) -36.1% 13.6
Net Income (Loss) - per year 7.8 41.8% (3.2) -36.1% 4.5
NOPAT 5.6
ROIC (it considers the effect of the average book value of the car in its useful life) 17.5%
Cost of debt after taxes 8.0%
Per operating car
Fleet Rental Seminovos
Per car sold
8. 8
2014 Consolidated breakdown
R$ million
Company’s profitability comes from
Car Rental and Fleet Rental Divisions.
12%
35%
52%
35%
65%
Net Revenues
R$3,892
EBITDA
R$970
52%
15%
33%
EBIT*
R$726
R$2,018
R$1,302
R$572
R$120
R$507
R$343
R$253
R$473
*Seminovos results recorded in the Car Rental and Fleet Rental Divisions
9. Raising
money Buying
cars
Renting Cars Selling
Cars
Cash to renew the fleet or pay debt
$
Profitability comes from rental divisions
Competitive advantages
$
9
42 years of experience in managing assets and generating value.
10. Competitive advantages: raising money
Global Scale
National Scale
Localiza raises money with better conditions then its competitors.
As of December, 2015.
BBB- Fitch
Baa3 Moody’s
BBB- S&P
Baa1 Moody´s
BBB+ S&P
B1 Moody´s
B+ S&P
Ba3 Moody´s
BB- S&P
BB- Fitch
brAAA S&P
Aa1.br Moody’s
AAA(bra) Fitch
brAA- S&P
A+ (bra) Fitch
brA S&P
A- (bra) Fitch
A+ (bra) Fitch A(bra) Fitch
Raising
money
Buying
cars
Renting Cars
Selling
Cars
10
Investment grade: lower spreads and longer tenors
Source: Bloomberg and companies website
11. 11
Competitive advantages: buying cars
Localiza buys cars with better conditions due to the volume of purchases.
Number of cars purchased - 2014
* Includes Franchising
86,426
22,920 17,246 14,177
Localiza Unidas Movida Locamerica
*
Source: each company website and ANFAVEA
Localiza’s share in the internal sales of the
major OEMs - 2014
3.6%
Raising
money
Buying
cars
Renting Cars
Selling
Cars
12. 442
155
95 107
43
Localiza Unidas Hertz Movida Avis
12
The Company is present in 243 cities where the other largest networks do not operate.
Competitive advantages: renting cars
Brand Brazilian distribution
#ofbranches*#ofcities**
Source: Each company website and Earnings Release
*As of September, 2015
**As of November, 2015
484
Raising
money
Buying
cars
Renting Cars
Selling
Cars
108
185
146
45
Localiza Competitors
490
13. 13
Constant innovations allow maintenance of the premium service.
Localiza Express®
Self‐service that provides fast
service, reducing queues and
scalability to service.
Localiza Way®
New platform to offer
value‐added services
Mobile Checklist
More quality, control and agility
in providing cars for rental
Fast Checkout
More operational productivity
and agility in returning the cars
after rental
Connected Shuttle
Optimization of
customer shuttle service
at airports
Anti fraud
Taylor‐made solution for
fraud prevention in car
rentals
Raising
money
Buying
cars
Renting Cars
Selling
Cars
Competitive advantages: Innovation
14. Raising
money
Buying
cars
Car rental
Selling
cars
Competitive advantages: Client satisfaction
81.0%
*Range of Net Promoter Scores (NPS) Across Industries in USA
*Source:Temkin Group Q3 2015 Consumer benchmark Survey
Low High
NPS Avg. NPS
% of Promoters % de Detractors
Score between 9 and 10 = 85.6% Score between 0 and 6 = 4.6%
YTD September/2015
“In a scale from 0 (zero) to 10, how much would you recommend Localiza to a
friend or colleague?”
Satisfaction Index: NPS – Net Promoter Score
Localiza: 1st place in the category Rental
Vehicles.
15. 15Differentiated offer with higher added value to the customer.
Integrated technology solution
that increases competitive
intelligence and leverages
productivity gains.
CONNECTED FLEET
Integrated mobile solution to
fleet rental services for drivers
and contract manager.
MOBILE SOLUTION
Rapid diagnosis and friendly
vision of the fleet by the
customer.
ONLINE FLEET RENTAL
Raising
money
Buying
cars
Fleet rental
Selling
Cars
Competitive advantages: Innovation
16. 16
Sales to final consumer
Competitive advantages: selling cars
Distribution channel: 200 cities and 1,900 customers.
Sales center: 20k incoming calls per month with 55% visits to stores scheduled.
Raising
money
Buying
cars
Renting Cars
Selling
Cars
Buffer: additional fleet during
peaks of demand
Information/mobility:
Ipad for Salesmen
• Support sale
• Access to the database
• Customer registration
• Agility in car sales
17. 17
ROIC versus cost of debt after taxes
7.3%
8.6%
6.3% 6.0%
8.0%
9.3%
16.9% 17.1%
16.1% 16.5%
17.5%
16.3%
2010 2011 2012 2013 2014 9M15*
*Annualized
ROIC
Cost of debt after taxes
9.6p.p. 8.5p.p. 9.5p.p.
9.8p.p. 10.5p.p.
7.0p.p.
18. Localiza Unidas Locamerica Ouro Verde JSL
Localiza Unidas Locamerica Ouro Verde JSL
Localiza vs. players
Profitability
Source: Companies’ Financial Statements 18
ROIC 2014
ROE 2014
Fleet
RAC+Fleet Rental RAC+Fleet Rental Fleet Rental Fleet Rental RAC+Fleet Rental
125,224 40,296 30,291 25,326 49,429*
Reference
ROIC = NOPAT / (Average net debt + average equity)
ROE = Net income / Equity at the beginning of the year
17.5%
8.1%
9.1% 8.5% 7.6%
30.6%
8.2%7.1%
10.9%
7.1%
Consolidated
Consolidated
22. 22
Drivers
Source: BCB and Localiza rates
151
180 200
240
260 300
350
380
415
465
510
545
622
678
724
51%
38%
37% 35%
31%
27%
22% 20% 18% 16% 15% 15% 13% 13% 12%
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Monthly minimum salary (R$) Daily rental price over minimum salary (%)
Car rental affordability
Source: IPEADATA and Localiza’s loyalty program.
5 million
84 million
Adult population
(age > 20 years)
Class A+B+C
15 million
Adult population
(age > 20 years)
Class A+B
Increasing affordability and low penetration in leisure trips brings growth opportunities.
23. 23
Drivers
# domestic air traffic passengers
In million
Infrastructure investment prospects 2015-2018
(in US$ billion)
Source: BNDES June, 2015.
70
82
89 90 96
122
2010 2011 2012 2013 2014 2017E
Source: ANAC
2017 estimates: BOEING
The strong pipeline of investments tend to benefit
the corporate segment.
Air traffic growth supporting demand at the airports.
89.4
57.9
27.2
21.3
17.0
16.6
12.3
6.8
ENERGY
TELECOMS
HIGHWAYS
URBAN MOBILITY
PORTS
SANITATION
RAILWAYS
AIRPORTS
24. 24Source: RAIS and each company’s website
As of November 2015.
Off-airport market is still fragmented.
Airport locations Off-airport locations
Car Rental Locations in Brazil
25. 25
Market Share – Car Rental 2014
Fleet
332,485 cars
Source: ABLA and Companies’ Financial Statements and estimates.
23.3%
2.4%
6.9%
5.8%
2.1%
59.5%
Localiza’s market share is higher than the 2nd and 3rd players together.
Movida
Unidas
Franchising
25.7%
Others
Avis
26. 26
1. Company overview
2. Main business divisions
Car Rental
Fleet Rental
Seminovos
3. Financials
Appendix: Earnings release 3Q15
Agenda
27. 27
Number of clients
Fleet Rental overview
35.0%
Compact cars
2014 Fleet composition
34,312 cars
65.0%
Others
729 760
798 826
2012 2013 2014 9M15
End of period fleet
32,104 32,809 34,312 33,160
2012 2013 2014 9M15
28. 28
Source: ABLA, Datamonitor and Localiza
Low penetration of rented fleet in Brazil.
Rented fleet penetration
Corporate fleet:
4,000,000*
Rented fleet:
440,737
34,312
Brazilian Market World
11.0% 8.9%
13.3%
16.5%
24.5%
37.4%
46.9%
58.3%
Drivers
*Localiza estimates
30. 30
1. Company overview
2. Main business divisions
Car Rental
Fleet Rental
Seminovos
3. Financials
Appendix: Earnings release 3Q15
Agenda
31. 31
Efficiency gain on car sales
# of points of sale
Car sales – operating data
55
66
73 74 75
76
2010 2011 2012 2013 2014 9M15
47,285 50,772
56,664
62,641
70,621
49,258
2010 2011 2012 2013 2014 9M15
# Number of cars sold (quantity)
32. 32
Source: O Estado de São Paulo newspaper, as of 08/16/13 (based on researches of Sindipeças) and Globo website, as of 03/10/2014.
Used car sales drivers:
affordability and penetration
# of inhabitants per car 2012 – (Brazil 2014)
4.2
4.0
4.0
3.6
2.1
2.0
1.9
1.8
1.2
Argentina
Brazil
Russia
South Korea
Japan
France
Germany
United Kingdon
USA
Affordability to buy cars – Public Price of
the most basic Gol
300 350 380
415 465 510
545
622 678 724
84
71 69
61
55
51
49
43 43 43
‐
10
20
30
40
50
60
70
80
90
‐
100
200
300
400
500
600
700
800
900
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Minimum wage (R$)
Minimum wages to buy a new car
33. 8.4 8.9 9.0 9.4
10.1
3.3 3.5 3.6 3.6 3.3
33
2.5x 2.5x
2010 2011 2012 2013 2014
2.6x
Brazilian car market:
new x used car market and affordability
New cars
Used cars
Source: FENABRAVE (light and commercial cars)
2.6x
Total market of 13.4 million cars.
3.1x
34. 34
2014 Up to 2 years
442,257
2014 Brand new
3,328,716
2014 Used cars
10,051,296
0.7% 1.8% 16.0%
Car sales – operating data
Source: Anfavea and Fenabrave
Examples
• Retailers
• “Loja do carro”
• Dealers
• Fiat, VW, Ford,
GM most
successful
• Auto Brasil
• Rental operators
• Locamerica, Hertz
• “Auto malls” and
“Cidade do
automóvel”
Points of sale • 48,000 (Fenauto) • 4,364 (Anfavea)
• +57 (Unidas, Movida,
Locamerica and
others).
• 71 (Fenauto)
Main players
35. 35
1. Company overview
2. Main business divisions
Car Rental
Fleet Rental
Seminovos
3. Financials
Appendix: Earnings release 3Q15
Agenda
36. 802.2
980.7
1,093.7 1,163.5 1,284.4
953.1 923.5
325.1 317.1
2010 2011 2012 2013 2014 9M14 9M15 3Q14 3Q15
36
Net Revenues (R$ million)
# Daily Rentals (thousands)
Car Rental
Investment in business intelligence contributed to capture the demand in specific segments
offsetting reduced volumes in those sectors sensitive to adverse scenario
10,734
12,794 13,749 14,242 15,416
11,518 11,455
3,880 3,871
2010 2011 2012 2013 2014 9M14 9M15 3Q14 3Q15
37. Average daily rental evolution – Car Rental
In R$
87.06 86.11
88.23 89.39
85.26
81.85
85.93
1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 3Q15
The increase in the average daily rental compared with 2Q15 is mainly due to the participation
of segments with the highest rate in the fleet mix even with the promotional bias
37
+5%
42. 1,910.4
1,776.5
1,618.8
2,026.2
2,483.2
1,605.8
1,440.7
584.2 539.3
1,321.9
1,468.1 1,520.0
1,747.3
2,018.2
1,465.2 1,545.7
535.9 502.5
2010 2011 2012 2013 2014 9M14 9M15 3Q14 3Q15
Purchases (includes accessories) Used car sales net revenues
Cars purchased Cars sold
42
Net investment
Fleet Expansion* (quantity)
The 5.5% Seminovos net revenue growth in 9M15 was due to the increase of 11.6% in the
average price, compensating the reduction of 5.6% in the number of cars sold
Net Investment in Fleet (R$ million)
65,934
59,950 58,655
69,744
79,804
52,738
42,372
17,674 15,521
47,285
50,772
56,644
62,641
70,621
52,153 49,258
18,815 15,738
2010 2011 2012 2013 2014 9M14 9M15 3Q14 3Q15
9,178 2,011
7,103
18,649
308.4
98.8
588.5 278.9
* It does not include theft / crashed cars.
9,183
465.0
585 (6,886)
(1,141) (217)
140.6 (105.0)
48.3 36.8
43. 43
End of period fleet
Quantity
Car Rental Division’s fleet was reduced by 6.459 cars when compared to 12/31/2014
to adjust the fleet size to demand
61,445 64,688 65,086 70,717 77,573 70,491 71,114
26,615 31,629 32,104 32,809
34,312
33,072 33,16010,652
12,958 14,545 14,233 13,339
12,800 13,175
2010 2011 2012 2013 2014 9M14 9M15
98,712
109,275 111,735 117,759
125,224
Car Rental Fleet Rental Franchising
116,363 117,449
44. 1,175.3 1,450.0 1,646.7 1,758.9 1,874.0 1,391.8 1,388.8
471.5 475.5
1,321.9
1,468.1 1,520.0 1,747.3
2,018.2
1,465.2 1,545.7
535.9 502.5
2010 2011 2012 2013 2014 9M14 9M15 3Q14 3Q15
Consolidated net revenues
R$ million
Consolidated net revenues grew 2.7% in 9M15 when compared with 9M14
Rental Used car sales
2,918.1
3,506.2
3,892.2
2,497.2
3,166.7
2,857.0 2,934.5
1,007.4 978.0
45. 45
Consolidated EBITDA
R$ million
649.5
821.3 875.6 916.5 969.8
732.2 706.7
241.5 238.8
2010 2011 2012 2013 2014 9M14 9M15 3Q14 3Q15
(*)From 2012 on, accessories and freight of new cars have been accounted directly in the cost line, impacting EBITDA but reducing
depreciation costs.
(**) The SG&A of this Division was positively impacted in 3Q14 by R$7.0 million due to the new appropriation criteria of the
overhead to Seminovos.
Divisions 2010* 2011* 2012 2013 2014 9M14 9M15 3Q14 3Q15
Car Rental 45.3% 46.9% 40.9% 36.8% 38.7% 39.3%** 32.4% 39.6%** 32.4%
Fleet Rental 68.0% 68.6% 66.4% 65.5% 60.0% 61.5% 61.6% 61.1% 62.6%
Rental Consolidated 52.3% 53.8% 49.3% 46.5% 45.3% 46.3% 42.0% 46.3% 42.3%
Used Car Sales 2.6% 2.8% 4.2% 5.7% 6.0% 6.0% 8.0% 4.4% 7.5%
Car Rental EBITDA margin in 3Q15 was 2.4p.p. higher than 2Q15 margin
46. 46
Average depreciation per car
in R$
Car Rental
The reduction of depreciation expense is a result of the increase in new cars prices that
reflects in the used cars prices
492
939
333
1,169
2,577
1,536 1,684
1,896
1,452 1,270
558
24,345
25,837 25,648
27,740
26,572 27,174
27,942
25,769
27,785
29,412
31,373
15,000
17,000
19,000
21,000
23,000
25,000
27,000
29,000
31,000
33,000
‐
1,000
2,000
3,000
4,000
5,000
6,000
7,000
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 9M15
Annualized average depreciation per car (R$) Average price of cars purchased ‐ Car Rental
1,377
IPI Effect
2,546 2,076
IPI Effect
3,972
Stable car priceRising car price Rising car price
47. 47
Average depreciation per car
in R$
Fleet Rental
2,981
2,383 2,396
4,372
3,510
4,133
4,592
4,202 3,921
32,106
33,190 33,754 34,192
30,741
35,414
33,315
35,025 35,693
38,346
45,602
15,000
20,000
25,000
30,000
35,000
40,000
45,000
‐
2,000
4,000
6,000
8,000
10,000
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 9M15
Annualized average depreciation per car (R$) Average price of cars purchased ‐ Fleet Rental
2,280
IPI Effect
5,083 1,097
IPI Effect
5,408
Stable car priceRising car price Rising car price
The reduction in depreciation reflects new car prices’ increase and the change in the fleet mix
2,803
4,311
48. 48
EBIT Divisions 2010 2011 2012 2013 2014 9M14 9M15 3Q14 3Q15
Car Rental 309.2 380.8 259.0 381.4 464.6 348.7 335.7 116.7 114.2
Franchising 6.2 7.2 8.9 10.9 8.7 7.6 4.9 2.6 1.7
Fleet Rental 166.7 207.7 197.9 259.8 253.4 196.5 219.8 64.1 79.0
Consolidated 482.1 595.7 465.8 652.1 726.7 552.8 560.4 183.4 194.9
Consolidated Margin 41.0% 41.1% 28.3% 37.1% 38.8% 39.7% 40.4% 38.9% 41.0%
38.5% 38.8%
23.7% 32.8%
36.2% 36.3%
46.2% 45.6%
36.9%
45.1% 44.3%
48.5%
2010 2011 2012 2013 2014 9M15
Car Rental
Fleet Rental
EBIT of Car Rental and Fleet Rental contemplates Seminovos results.
*2012 EBIT was impacted by R$144.5 million of additional depreciation related to IPI (sales tax) reduction.
EBIT
Margin calculated over rental revenues
Improvement of the EBIT margin, even in an adverse scenario
IPI Effect
+R$11.5
49. 250.5
291.6
240.9
384.3 410.6
308.3 296.5
101.9 102.9
2010 2011 2012 2013 2014 9M14 9M15 3Q14 3Q15
49
Consolidated net income
R$ million
* Pro forma 2012 net income excluding additional depreciation related to the IPI tax reduction, net of income tax.
336.3 *
The 3Q15 consolidated net income grew 1.0%
50. 50
Free cash flow - FCF
Free cash flow - R$ million 2010 2011 2012 2013 2014 9M15
Operations
EBITDA 649.5 821.3 875.6 916.5 969.8 706.7
Used car sale revenue, net from taxes (1,321.9) (1,468.1) (1,520.0) (1,747.3) (2,018.2) (1,545.7)
Depreciated cost of cars sold 1,203.2 1,328.6 1,360.2 1,543.8 1,777.0 1,322.5
(-) Income tax and social contribution (57.8) (83.0) (100.9) (108.5) (113.1) (72.5)
Change in working capital 54.5 (83.9) 37.1 2.9 (27.1) (53.7)
Cash provided by rental operations 527.5 514.9 652.0 607.4 588.4 357.3
Capex-
Renewals
Used car sale revenue, net from taxes 1,321.9 1,468.1 1,520.0 1,747.3 2,018.2 1,329.7
Fleet renewal investment (1,370.1) (1,504.5) (1,563.3) (1,819.7) (2,197.7) (1,440.7)
Net investment for fleet renewal (48.2) (36.4) (43.3) (72.4) (179.5) (111.0)
Fleet renewal – quantity 47,285 50,772 56,644 62,641 70,621 42,372
Investment, other property and intangibles investments (50.6) (59.9) (77.8) (47.5) (46.3) (18.1)
Free cash flow before growth, new headquarters and interest 428.7 418.6 530.9 487.5 362.6 228.2
Capex-Growth
Fleet growth investment (540.3) (272.0) (55.5) (209.4) (286.8) -
Cash generated by fleet reduction - - - - - 216.0
Change in accounts payable to car suppliers 111.3 32.7 (116.9) 89.7 334.4 (257.6)
Fleet growth (429.0) (239.3) (172.4) (119.7) 47.6 (41.6)
Fleet increase / (reduction) – quantity 18,649 9,178 2,011 7,103 9,183 (6,886)
Free cash flow after growth, and before interest and new HQ (0.3) 179.3 358.5 367.8 410.2 186.6
Capex–
HQ
Investment in the construction of the new HQ (0.5) (3.1) (2.4) (6.5) (55.7) (86.2)
Marketable securities – new HQ - - - - (92.6) 92.6
New headquarters construction (0.5) (3.1) (2.4) (6.5) (148.3) 6.4
Free cash flow before interest (0.8) 176.2 356.1 361.3 261.9 193.0
51. 51
- 1,425.7
(146.5)
Interest
Net debt
09/30/2015
Cash generation before
interest
193.0
-1,322.3
Net debt
12/31/2014
(109.8)
Dividends
Changes in net debt
R$ million
The increase in net debt is due to dividends payment and share repurchases
(27.5)
Treasury
shares
purchased
(12.6)
Mark to
market -
MTM
52. 2,446.7
2,681.7
2,547.6
2,797.9
3,296.3 3,285.2
2010 2011 2012 2013 2014 9M15
52
Debt - ratios
Net debt + OEMs vs. Fleet value
BALANCE AT THE END OF PERIOD 2010(*) 2011 2012 2013 2014 9M15
Net debt + OEMs / Fleet value 68% 66% 60% 61% 62% 57%
Net debt / Fleet value 52% 51% 48% 48% 40% 43%
Net debt / EBITDA** 2.0x 1.7x 1.4x 1.5x 1.4x 1.5x
Net debt / Equity 1.4x 1.2x 0.9x 1.0x 0.8x 0.8x
EBITDA / Net financial expenses 5.0x 4.6x 6.3x 8.3x 6.4x 4.4x
(*) 2010 ratios based on USGAAP financial statements
**Annualized
OEMs Net debt Fleet value
Comfortable debt ratios
1,281.1 1,363.4 1,231.2 1,332.8 1,322.3 1,425.7
372.6 405.3 288.4 378.1 712.5 454.9
1,653.7 1,768.7 1,519.6 1,710.9
2,034.8 1,880.6
53. 66.2
318.8 394.0
221.1
594.5 595.0
447.5
2015 2016 2017 2018 2019 2020 2021
53
Debt maturity profile (principal)
R$ million
Strong cash position and comfortable debt profile
Cash
1,000.1
As of September 30, 2015
1,287.2
54. 54
Localiza Level I ADR
Ticker Symbol: LZRFY
CUSIP: 53956W300
ISIN: US53956W3007
Ratio: 1 Common Share : 1 ADR
Exchange: OTC
Depositary bank: Deutsche Bank Trust Company Americas
ADR broker helpline: +1 212 250 9100 (New York)
+44 207 547 6500 (London)
E-mail: adr@db.com
ADR website: www.adr.db.com
Depositary bank’s local custodian: Banco Bradesco S/A, Brazil
55. 55
Disclaimer
Website: www.localiza.com/ir E-mail: ri@localiza.com Phone: 55 31 3247-7024
Roberto Mendes
CFO and IR
Nora Lanari
Head of IR
Eugênio Mattar
CEO
The material presented 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 projections 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.
Securities may not be offered or sold in the United States unless they are registered or exempt from registration under the Securities Act of 1933.
This presentation does not constitute an offer, invitation or solicitation of an offer to subscribe to or purchase any securities. Neither this presentation nor anything
contained herein shall form the basis of any contract or commitment whatsoever.
Maria Carolina Costa
IR Manager
Mariana Campolina
IR Manager