Transcript
Page 1: Corporate presentation   september

LLX Logística S.A.

July, 2008

LLX Logística S.A.

September, 2008

Page 2: Corporate presentation   september

2

This presentation relating to LLX Logística S.A. (“LLX”) includes “forward-looking statements”, as that term is defined in the Private Securities Litigation Reform Act of 1995, in Section 27A of the Securities Act of 1933 and Section 21E of the U.S. Securities Exchange Act of 1934. All statements other than statements of historical facts are statements that could be deemed forward-looking statements and are often characterized by the use of words such as “projects”, “expects”, “anticipates”, “intends”, “plans”, “believes”, “estimates”, “may”, “will”, or “intends”, or by discussions or comments about our objectives, strategy, plans or intentions and results of operations. Forward-looking statements include projections regarding our operating capacity, operating expenditures, capital expenditures and start-up dates.

By their nature, these forward-looking statements involve numerous assumptions, uncertainties and opportunities, both general and specific. The risk exists that these statements may not be fulfilled or, even if they are fulfilled, the results or developments described in such statements may not be indicative of results or developments in future periods. We caution participants of this presentation not to place undue reliance on these forward-looking statements as a number of factors could cause future results to differ materially from these statements.

Forward-looking statements may be influenced in particular by factors such as the ability to obtain all required regulatory approvals and licenses on a timely basis or at all, and changes in economic, political and regulatory conditions. We caution that the foregoing list is not exhaustive. When relying on forward-looking statements to make decisions, investors should carefully consider these factors as well as other uncertainties and events.

LLX does not undertake to update our forward-looking statements unless required by law. This presentation is neither an offer to sell (which can only be made pursuant to definitive offering documents) nor a solicitation of an offer to buy any securities in the United States, or any other jurisdiction. The securities referred to herein have not been registered in any jurisdiction, and in particular, will not be registered under the U.S. Securities Act of 1933, as amended, or any applicable state securities laws and may not be offered or sold in the United States absent registration or an applicable exemption from such registration requirements.

This presentation and its contents are proprietary information and may not be reproduced or otherwise disseminated in whole or in part without LLX’s prior written consent.

Investor Relations

Ricardo Antunes – CEO

Antonio Castello Branco – Manager

Tel. 55 21 2555-5661

[email protected]

Disclaimer

Page 3: Corporate presentation   september

1. Overview

Page 4: Corporate presentation   september

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EBX´s publicly held companies

All companies are listed in BOVESPA´s Novo Mercado Corporate Governance

segment, consolidating a market capitalization of US$ 18.3 Bi*.

Core Business: Logistics

Market Cap:

US$ 764 M*

Controlling Shareholder:

57%

Core Business: Power Generation

Market Cap: US$ 1.9 bi*

Controlling Shareholder:

76%

Core Business: Oil & Gas

Market Cap: US$ 12.5 bi*

Controlling Shareholder:

61%

Core Business: Mining

Market Cap:

US$ 3.0 bi*

Controlling Shareholder:

67%

*Source: Broadcast as of August, 29th 2008

Page 5: Corporate presentation   september

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LLX Corporate Overview after restructuring

(1) Eike Batista and Management

51%

43%

LLX Minas-Rio LLX Açu

70%

30%

Centennial

57%

LLX Brasil LLX Sudeste

Controlling

Shareholders + Minority Shareholders(1)

70% 70%

30%30%

49%

MMX Minas-Rio

100%

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Ports strategically located in the Southeast Region of Brazil

Large back-areas

Port-Industry Integration

Connected to existing Highway and Railway network

UniquePortfolio

Enough cargo to anchor LLX´s ports (MoUs already signed)

Back-bone for investments of the EBX´s Companies through long term contracts

Logistics Integration is a priority for the Brazilian government

Brazilian ports are operating almost at full capacity

Ports are currently a bottleneck for Brazilian exports growth

Continuous pipeline of new projects

Deeper depth allows larger vessel to berth, decreasing ocean freight

Private ports are not subject to public port charges (TUP and OGMO)

Higher productivity due to latest generation of port equipments

LLX Highlights

Long Term Contracts

Growth Potential

Low Operating Costs

Ports business has been developed since 2005

“Super Port” Açu under construction

Business Development

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LLX´s ports strategic location

LLX Port´s hinterland concentrates

75% of the Brazilian GDP

Port Açu

Port SudestePort Brasil

2%

34%

6%

Mixed-use terminal sized to berth carriers up to 220,000 tons (Depth: 18.5m)

Location Back-area Main Products

"Super Port" AçuSao Joao

da Barra,

RJ

7,800 ha

Iron Ore from pipelines and

third parties railway, steel

products, coal, granite, LNG

and general cargo.

Port Sudeste Itaguaí

Industrial

Area, RJ

52.1 ha Iron Ore

"Super Port"

BrasilPeruibe, SP

1,900 ha

(maritime

structure with

50 ha)

General Cargo, iron ore,

agricultural bulk, liquid bulk

and fertilizers

Source: IMF (2008)

Country GDP 2007 (US$ Billion)

Brazil 1,313.590

Russia 1,289.582

India 1,098.945

LLX's hinterland area 985.223

Korea 957.053

Australia 908.826

Mexico 893.365

Netherlands 768.704

Turkey 663.419

Sweden 455.319

Belgium 453.636

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Favorable Industry Fundamentals

Source:IPEADATA / BCB e Merril Lynch (2008)

Economic Openness – Trade Flow / GDP 2007Brazil Trade Flow

73 96

Brazilian Ports’ Capacity Utilization

Source: Antaq.

(berth hours utilized / berth hours available)

97% 93% 91%

80%

Itajaí São Francisco

do Sul

Rio Grande Santos

Source: WTO (2008)

Economics Openness- Trade Flow 2007

Infrastructure Underinvestment in Brazil

18%

22%

33%

39%

48%

64%67%

70%

76%

Brazi l

2000

Brazil India Argentina Indonesia Mexico China Chile Republic

of Korea

0

20

40

60

80

100

120

140

160

180

1970 1973 1976 1979 1982 1985 1988 1991 1994 1997 2000 2003 2006

Brazil exports Brazil imports Investments in infrastructure

Investments in ports are needed to meet the growth of Brazil´s foreign trade.

60 7396

118138

161198

4748

63

74

91

121

174

2002 2003 2004 2005 2006 2007 2008E

Imports

Exports

Source: SECEX/Ministério do Desenv. Ind e Comercio Exterior (2008)

CAGR (2

002-200

8): 23%

(US$ billion)

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Experienced Management Team

OfficerOfficer ExperienceExperience

Ricardo Antunes

CEO

Engineer Degree from PUC-RJ and Master´s degree from the Imperial College in London.

23 years of experience at CVRD

Former CEO of Rio Doce International

Co-founder of MMX

Eliane Aleixo Lustosa

Chief Financial Officer

Masters degree in Economics from PUC-RJ and PhD in Finance. Held Yale Universitiy´scertificate in Corporate Governance.

Government experience at BNDES, Ministry of Finance and as Director of Brazil´s Antitrust Agency. Former VP and CFO of Grupo Abril, Globex and Petrobras Pension Fund (Petros).

Current board member of the Brazilian Institute of Corporate Governance (IBGC). Former board member of several public companies (Perdigão, CPFL, Coteminas, Telet, Americel and Tele Norte Celular).

José Salomão

Chief Development Officer

Mechanical Engineer (UFES) and MBA in COPPEAD/UFRJ

23 years of experience in the design, implementation and operation of port terminals (iron ore, coal, pig iron, fertilizers, agricultural baul, containers and general cargo).

Held executive positions in Porto de Tubarão, Porto de Praia Mole, TVV, Pasha Terminal – Los Angeles, Docenave and Brasil Ferrovias.

Luis Alfredo Osório de Castro

Chief Implementation Director

Civil Engineer (UGF/RJ) and MBA from FGV/RJ. Project Management (PMI) certificate from FIA/USP.

30 years experience in implementing infrastructure projects (urban projects and port terminals); power plants and industrial facilities at Pronil, OAS and Brascan.

Eike Fuhrken Batista

Chairman and Founder

Founder and CEO of EBX, entrepreneurial conglomerate founded in 1983

Page 10: Corporate presentation   september

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LLX Ports – Lower Ocean Freight

Solid and LiquidBulks

Using full Panamax (70 m dwt) and Capesize (120 to 180 m dwt) rather than Handymax(40 m dwt )

-40% to -75%

-20% to -40%

Deeper depth allows larger vessels to berth, decreasing ocean freight.

ContainersProcessing Industries, Auto Parts,

Food, Pulp and Paper, amoung

othes.

Using general cargo/container vesselsof 8 to 12 thousand TEUs instead of

1.5 thousand to 3 thousand TEUs

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1,5

IronIron Ore Ore TerminalsTerminals: : IdleIdle TimeTime

ReferenceIndex

Vale

15 -20%

< 2%

ThousandThousand TEUTEU’’s/m linear s/m linear berthberth

Reference Index

Santos Brasil

1,3

BackBack AreaArea: TEU: TEU’’s/ms/m²²

Reference Index

Vitoria

4,2

7

Continuous economic growth in the last years has shown Brazil’s lack of infrastructure, especially in ports and transportation.

Most Brazilian ports are operating above their nominal capacity, causing long queues and increased costs for both inbound and outbound cargoes.

The situation is most critical in the country’s southeast region, hampering growth of the burgeoning export of commodities and industrial products as well as most needed imports growth.

Ports Operations almost at Full Capacity

Source: Drewry’s Reports 2007 and Companies reports.

LLX´s port will be an alternative to help debottlenecking the sector in Brazil

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LLX Milestones Roadmap

2006 2007 2008 2009 2010 2011 2012

Detailing of the

project

Construction

LicenseStart up

Environmental

License

ANTAQ

Authorization

Construction

begins

Detailing of the

project

ANTAQ

authorization

Construction

License

Construction

beginsStart up

Environmental

License

Project begin to

be developed

Environmental

License

Construction

License Start up

ANTAQ

Authorization

Construction

begins

Project begin to

be developed

Environmental

License

Construction

LicenseStart up

ANTAQ

Authorization

Construction

begins

LLX M

inas�R

ioLLX Açu

Porto Sudeste

Porto Brasil

Page 13: Corporate presentation   september

2. Projects

Page 14: Corporate presentation   september

2A. Port Açu

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Port AçuLocation and Logistic Integration

45 km of new railway track

will connect

Port Açu to the

Brazilian railway system.

MMX SE

Port Açu

Port Sudeste

Page 16: Corporate presentation   september

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Port AçuLLX Minas-Rio (Ore) / LLX Açu (non-Ore)

• Connecting bridge / Access channel

7,500 ha of adjacent industrial complex

Right to use LLX Minas Rio

Offshore Structure including the

construction of additional berths

for :

• Coal ( and dry bulk) discharging;

• Liquid Bulk ;

• Multi use Pier with 4 berths for

general cargo, steel and Supply

boats.

LLX ALLX Aççuu

AtlanticAtlantic OceanOcean

LLX MinasLLX Minas--Rio Rio

• 300 ha for Processing, Handling,Storage and Pelletizing

• Breakwater

• 1 berh expandable to 4 for loading iron ore and pellets ;

Offshore Structure including :

Onshore Structure

• Connecting bridge/ Access channel

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Port AçuUnder construction and attracting important industries

Port Açu construction started in October/2007 and has already 46 MoUs in place

IRON ORE 26.5 Mtpy 1 contract

LIQUID BULK 5.5 M m³ py 7 MoUs

GENERAL CARGO 73.4k TEUs py 29MoUs

COAL/CEMENT 11.2 Mtpy 6 MoUs

STEEL PRODUCTS 8.2 Mtpy 4 MoUs

IRON ORE 26.5 Mtpy 1 contract

LIQUID BULK 5.5 M m³ py 7 MoUs

GENERAL CARGO 73.4k TEUs py 29MoUs

COAL/CEMENT 11.2 Mtpy 6 MoUs

STEEL PRODUCTS 8.2 Mtpy 4 MoUs

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Port AçuConstruction site

August/2008

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Port Açu is located right in front of the largest Brazilian oil basin block (Campos, Santos and Espírito Santo)

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Up to 330,000 TEUs py

Iron Ore: Coal: Liquid Bulk (LNG): Steel Products:

Dimension Stone: General Cargo: Supply Boats:Real Estate:

Up to 63.2 mtpy Up to 15.3 mtpy Up to 4.0 M m 3 py Up to 11.2 mtpy

Up to 1.5 mtpy Up to 80,000 tons of cargo py Up to 3,300 hectares for rental

Port AçuMain activities

Capex ( for 100% of project )

LLX Minas-Rio: US$ 900 M

Açu Non Ore: US$ 700 M

CapexCapex ( for 100% ( for 100% ofof projectproject ))

LLX Minas-Rio: US$ 900 M

Açu Non Ore: US$ 700 M

Source : Verax Feasibility Study as of June 12th 2008

Page 21: Corporate presentation   september

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2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

...

...20

32

- - -

20,0

30,3

39,8

62,267,9

77,682,0

93,5

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

...

...20

32

53,2

348,8

766,0

274,5

75,415,1

65,2

38,1

283,6

560,4

17,8

80,7

205,6

Port AçuVolume and Capex

DevelopmentDevelopment CapexCapex

US$ 1,600 MUS$ 1,600 M

Minas-Rio (Iron Ore) US$ 900M

Port Açu Non US$ 700 M

256,7

(*) Tonnage excluding general cargo

Source : Verax Feasibility Study as of June 12th 2008

Volume Volume RampRamp upup –– MtpyMtpy **

Page 22: Corporate presentation   september

2B. Port Brasil

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Port BrasilLocation and Logistic Integration

Port Brasil will be connected by a 1800 km

railway track (ALL) and by a four-lane

highway (Padre Manoel da Nóbrega).

MMX CORUMBA

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Port Brasil Infrastructure

Back-area: 6 million m2 Island: 500.000 m2Taniguá Industrial Area

13 million m2

Distribution Center

Consolidation andDeconsolidation Center

High Value Added Industries

Annual Capacity:

• General Cargo: 3,2 million (TEU)

• Iron ore: 20 million (ton)

• Agricultural bulk: 28,9 million (ton)

• Fertilizers: 10 million (ton)

• Liquid Bulk: 7,5 million (ton)

11 berths

Depth of 18.5 m

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General CargoUp to 3.2 M TEUs py

Iron OreUp to 20.0 mtpy

Liquid Bulk (Ethanol)Up to 7.5 M m3 py

Agricultural BulkUp to 28.9 mtpy

FertilizersUp to 10.0 mtpy

Real StateUp to 600 hectares for rental

Port BrasilMain activities

A new alternative for Brazilian’s commodities

and manufactured exports

SUGAR AND GRAINS BULK 16.6 M tpy 12 MoUsGENERAL CARGO 1.1 M TEUs py 5 MoUsETHANOL 22.5 M m3 py 3 MoUs

Source : Verax Feasibility Study as of June 12th 2008 and Company

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2,2

97,9

553,2 561,7

346,0

100,3

41,2 35,3

79,8

1,8 -

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

...

...20

32

- - - - -

17,8

27,0

41,145,4 46,5

64,9

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

...

...20

32

Port BrasilVolume and Capex

Volume Volume RampRamp upup -- MtpyMtpy *

(*) Tonnage excluding general cargo

Source : Verax Feasibility Study as of June 12th 2008

DevelopmentDevelopment CapexCapex

US$ 1,950 MUS$ 1,950 M

Page 27: Corporate presentation   september

2C. Port Sudeste

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Port SudesteLocation and Logistic Integration

Currently Transportation contract secured with

MRS and port access with CSN Sepetiba Terminal

until 2011, when port Sudeste starts up.

MMX

Sudeste

MRS

Port

Sudeste

Belo Horizonte

Page 29: Corporate presentation   september

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Port Sudeste Overview

Railway Loop

Tunnel 1.5 km

Bridge 0.8 km

Berth

IronIron Ore Ore

StorageStorage

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43,949,0

169,1

118,3

- - - - - - -

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

...

...20

32

- - - -

5,0

10,0

15,0

20,0

25,0 25,0 25,0

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

...

...20

32

Port SudesteVolume and Capex

Volume Volume RampRamp upup 11STST PhasePhase --

MtpyMtpyDevelopmentDevelopment CapexCapex 11ST ST PhasePhase

US$ 380 MUS$ 380 M

Source : Verax Feasibility Study as of June 12th 2008

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Capex - Sources and Uses

Source : Verax Feasibility Study as of June 12th 2008 and Company.

LLX Minas Rio Shareholder´s Equity @ June 30th: US$ 211 M

LLX Açu + LLX Brasil + LLX Sudeste Shareholder´s Equity @ June 30th: US$ 174 M LLX S.A. US$ 123 M

Centennial US$ 53 M

LLX Açu

700

175123

525

53

0

200

400

600

800

100% CAPEX Sources Equity

US

$ M Debt:

Equity:LLX:

Centennial:

75%

25%

LLX Brasil

1950

488 341

1463

146

0

200

400

600

800

1000

1200

1400

1600

1800

2000

2200

100% CAPEX Sources Equity

US

$ M Debt:

Equity: LLX:

Centennial:

75%

25%

LLX Sudeste

380

95 67

285

29

0

200

400

100% CAPEX Sources Equity

US

$ M

Debt:

Equity:Centennial:

LLX:

75%

25%

LLX Minas Rio

900

225 180

675

45

0

200

400

600

800

1000

100% CAPEX Sources Equity

US

$ M Debt:

Equity: Anglo:

75%

25%2st Phase 300

1nd Phase 600

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Product share per Port as of 2016

Source : Verax Feasibility Study as of June 12th 2008

Page 33: Corporate presentation   september

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Main Risks & Mitigants

Main Risks&

Mitigants

Funding Requirements

Long Term (12 years) and attractively priced

Financing by BNDES secured for LLX Minas-Rio

and under negotiated forSudeste and LLX Açu

ports terminals;

Bradesco firm commitment for US$ 750 M.

Regulatory Risk

Indigeneous Community

Environmental Risk

Experienced procurement team on board;

Rigorous budget controls and contingengy

management;

Modular implementation with initial

investments after LT contracts are locked in.

Business Plan compliant with Port Act (Law 8630/93);

Port Açu has been granted ANTAQ´s Authorization ;

Port Sudeste is a Private Terminal for MMX Sudeste´s own cargo;

Port Brasil´s Business Plan limited 3rd party cargo still delivers a very attractive ROI.

Management expertise

� Seasoned technical team ( permitting

processes of ports in Brasil- for CVRD, CSN...);

EBX Track Record

� MMX, MPX precedents and synergy;

Top consulting firms hired.

More than 90% of the 60 families occupying 10

hectares of Port Brasil have agreed to

reallocate;

Negotiation with FUNAI well underway.

Capex Overruns

Port – Railways Integration

Port Açu - negotiations with FCA are in a very

advanced stage;

Port Brasil - MoU signed with ALL, joint

feasibility study by Sandwell to be completed

by 4T08, for the development of a new corridor

for Central Western region;

Port Sudeste - MRS expansion plan easily

covers the port´s demand.

Page 34: Corporate presentation   september

LLX Logística S.A.

July, 2008

www.llx.com.br


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