Q4 2012 results conference call, February 28, 2013

1. Conference C ll
C f Call
2012 and 4Q12
February 28th, 2013

2. Disclamer
The statements that may eventually be made during this conference call
relating to WEG’s business perspectives, projections and operating and
financial goals and to WEG’s potential future growth are management
beliefs and expectations, as well as information that are currently available.
These statements involve risks, uncertainties and the use of assumptions,
as they relate to future events and, as such, depend on circumstances
that may or may not be present.
Investors should understand that the general economic conditions,
conditions
conditions of the industry and other operating factors may affect WEG’s
future performance and lead to results that may differ materially from those
expressed in such f t
di h future considerations.
id ti
4Q12 Conference Call Page 2 February 28, 2013

3. Agenda
Sérgio Schwartz – Executive Vice President
Highlights
Revenues growth and performance
Laurence Beltrão Gomes – Finance and Investor Relations Officer.
Costs, Expenses, EBITDA
Cash Flow
Capex
Sérgio Schwartz – Executive Vice President
Outlook and final remarks
Questions and answers
4Q12 Conference Call Page 3 February 28, 2013

4. Highlights
Yearly Figures
2012 2011 % 2010 %
Net Operating Revenue 6,173,878 5,189,409 19.0% 4,391,973 18.2%
Domestic Market 3,016,662 2,902,958 3.9% 2,670,443 8.7%
External Markets 3,157,216
3 157 216 2,286,451
2 286 451 38.1%
38 1% 1,721,530
1 721 530 32.8%
32 8%
External Markets in US$ 1,609,721 1,361,689 18.2% 982,835 38.5%
Gross Operating Profit 1,880,856 1,556,051 20.9% 1,386,952 12.2%
Gross Margin 30.5% 30.0% 31.6%
Quarterly Net Income 655,979 586,936 11.8% 519,782 12.9%
Net Margin 10.6%
10 6% 11.3%
11 3% 11.8%
11 8%
EBITDA 1,053,545 882,340 19.4% 789,110 11.8%
EBITDA Margin 17.1% 17.0% 18.0%
EPS 1.0573
1 0573 0.9461
0 9461 11.8% 0.8371
0 8371 13.0%
Figures in R$ Thousands
4Q12 Conference Call Page 4 February 28, 2013

5. Net Operating Revenue
Annual Evolution
In US$ million
External Market
6,174
6 174
Domestic Market 19%
5,189
18%
4,502 4,392
4,211 4% 3,157
-6%
6% 2,286
2 286
1,842 1,684 1,722
2,660
2 660 2,670
2 670 2,903
, 3,017
2,526
2 526
2008 2009 2010 2011 2012
4Q12 Conference Call Page 5 February 28, 2013

6. Highlights
Quarterly Figures
Q4 2012 Q3 2012 % Q4 2011 %
Net Operating Revenue 1,662,258 1,613,067 3.0% 1,468,551 13.2%
Domestic Market 774,533 798,626 -3.0% 781,938 -0.9%
External Markets 887,725
887 725 814,441
814 441 9.0%
9 0% 686,613 29.3%
686 613 29 3%
External Markets in US$ 431,141 401,460 7.4% 380,772 13.2%
Gross Operating Profit 528,641 498,587 6.0% 445,686 18.6%
Gross Margin 31.8% 30.9% 30.3%
Net Income 183,157 184,756 -0.9% 156,248 17.2%
Net Margin 11.0%
11 0% 11.5%
11 5% 10.6%
10 6%
EBITDA 300,603 284,276 5.7% 258,210 16.4%
EBITDA Margin 18.1% 17.6% 17.6%
EPS 0.2952
0 29 2 0.2978
0 29 8 -0.9% 0.2518
0 2 18 17.2%
Figures in R$ Thousand
4Q12 Conference Call Page 6 February 28, 2013

7. Net Operating Revenue
Quarterly Evolution
In US$ million
External Market
Domestic Market
1,613 1,662
1,469 1,529
1,317
1 317 1,370
1 370
1,277
1,126 53%
52% 50%
47%
43% 44% 48%
41%
59% 57% 56% 53% 52% 48% 50% 47%
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4
2011 2012
4Q12 Conference Call Page 7 February 28, 2013

8. Business Areas
Revenue breakdown
In R$ million
7% 6% 6% 6% 7% 6% 8% 7%
11% 11% 10% 9% 9% 10% 10%
13%
24% 23% 22%
23% 25% 25%
24% 27%
60% 58% 60% 61% 63%
57% 57% 55%
1Q11 2Q11 3Q11 4Q11 1Q12 2Q12 3Q12 4Q12
Industrial Equipment GTD Domestic Use Paints & Varnishes
4Q12 Conference Call Page 8 February 28, 2013

9. Costs of Goods Sold
Materials
Materials 66%
65%
2012 2011
Others Costs
Oth C t
10% Labor
Depreciation 21%
4% Labor Other Costs Depreciation
21% 9% 4%
4Q12 Conference Call Page 9 February 28, 2013

10. Main impacts on EBITDA
in R$ million
454.3 638.3
530.2
FX Impact on
Revenues 109.5
COGS 50.4
(ex depreciation) 15.1
15 1 1,053.5
1 053 5
Selling
General and
Expenses Profit Sharing
882.3 Administrative
Program
Volumes, Expenses
Prices &
Pi
Product Mix
Changes
EBITDA 2011 EBITDA 2012
4Q12 Conference Call Page 10 February 28, 2013

11. Working Capital
In % of Net Revenue
50,0%
40,0%
Working Capital
30,0%
Clients
20,0%
20 0% Inventories
I t i
10,0%
10 0% Advances from
Clients
Suppliers
0,0%
,
4Q05 4Q06 4Q07 4Q08 4Q09 4Q10 4Q11 4Q12
4Q12 Conference Call Page 11 February 28, 2013

12. Capex Program
In R$ million 10.2%
Capex
9.3%
% Net Revenue
8.1%
7.4%
5.8%
457 5.4% 5.3%
3.7% 3.6% 3.9%
305
226 233 238
206 188
126 146
111
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
4Q12 Conference Call Page 12 February 28, 2013

13. Strategic Planning WEG 2020
Aspirations and strategic direction
19%
18%
20.000
0
4.392
5.189
6.174
2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
4Q12 Conference Call Page 13 February 28, 2013

14. Contacts
Laurence Beltrão Gomes www.weg.net/ir
Finance and Investor Relations Officer
laurence@weg.net
Luís Fernando M. Oliveira
Investor Relations Manager
+55 (47) 3276-6973
lluisfernando@weg.net
i f d @ t
twitter.com/weg_ir
4Q12 Conference Call Page 14 February 28, 2013