ita? ceo conference

Corporate Presentation

and 1Q16 Results

2

Disclaimer

This presentation may contain statements that present expectations of the Management of Mills Estruturas e Serviços de Engenharia S/A

(“Mills”) about future events or results. Such statements are based on beliefs and assumptions of our Management taken with our best

knowledge and information to which Mills currently has access. All statement,. when based on future expectations, and not on historical

facts, involve various risks and uncertainties, and are not performance guarantees. Mills and employees cannot guarantee that such

statements will prove to be correct. Such risks and uncertainties include factors relating to the Brazilian economy, the capital markets, the

infrastructure, real estate, and oil and gas sectors, competitive pressures, among others, and governmental rules that are subject to

change without notice. For additional information on the factors that may give rise to results different from those estimated by Mills, please

consult the reports filed with the Securities and Exchange Commission - SEC.

Corporate Presentation and 1Q16 Results

3



1. Industry Overview

2. Company Overview

3. Business Units

4. Financial Profile

4

Brazil Macro Fundamentals


GDP Growth Inflation¹

Interest Rates² BNDES Disbursements

R$ billion

Source: Brazilian Central Bank

(1) IPCA end of period

(2) Selic end of period

In R$ million

7,5%

2,7%

1,0%

2,5%

0,1%

-3,8%

8,75%

12,25%

7,25%

10,00% 11,00%

14,25%

5,9% 6,5%

5,8% 5,9% 6,4%

10,6%

168,4

138,9

156,0

190,4 187,8

135,9

18,1

The uncertainties in the economic and political environments continue to impact the markets in which we operate. The

deterioration of the fiscal situation of the Government and the lack of confidence in the market resulted in the paralysis

of the economy. There is a hope that the new government can carry out reforms and foster infrastructure investments.

5

Brazilian Outlook


" Meirelles argued that the solution to the economic crisis facing Brazil depends on federal government investments in

infrastructure and loans to private companies.“ O Globo. 04/29/2016

“… First, restore confidence in macroeconomics. In the second stage, take care of microeconomics, which are

investments in infrastructure, judicial issues of companies, a broad growth agenda .“ O Globo. 04/29/2016

" ( ... ) The PMDB preaches transfer to the private sector all that is possible in the field of infrastructure. ( ... ) The plan

also says the government needs to establish a new model of relations with the private sector, including modifying the

current law on bidding .“ 04/29/2016 Folha de São Paulo

" The vice –president, Michel Temer (PMDB ), defined three main axes for the formation of its eventual government:

economy, infrastructure and social area.“ 04/19/2016 . Estado de São Paulo

On May 12. 2016 the new acting President Michel Temer announced a provisory measure to create the program

Programa de Parcerias de Investimento – PPI (Investment Partnership Program), focused on job creations. with the goal

to expand investment oportunities. employment and stimulate technological development. The program wants to ensure

“expansion with quality" of infrastructure, with adequate rates and prices, strengthening the regulatory role of the State

and the autonomy of the regulatory agencies.

6

Brazil lags behind other BRIC countries

in quality of infrastructure


Index 1.0 (best)

0,9

0,5

0,6

0,6

0,7

USA

Brazil

Russia

India

China

Air Transport

0,8

0,4

0,6

0,6

0,6

USA

Brazil

Russia

India

China

Ports

0,7

0,2

0,6

0,6

0,7

USA

Brazil

Russia

India

China

Railways

0,8

0,4

0,4

0,6

0,7

USA

Brazil

Russia

India

China

Highways

Source: The Global Competitiveness Report 2015-2016

Infrastructure quality ranking for BRIC countries

(2014-2015)

There is a significant demand for better infrastructure in Brazil, which can reduce the country’s growth bottleneck. The

quality of Brazil’s highways, railways, ports and air transport are very poor, increasing the cost of Brazil.

Investments in infrastructure in Brazil are historically low

2,1 1,5 0,8 0,6 0,7

0,8

0,4

0,7 0,7 0,5

2,0

1,5

0,6 0,6 0,9

0,5

0,2

0,2 0,2

0,2

5,4

3,6

2,3 2,1

2,3

1971/80 1981/89 1990/2000 2001/10 2011/14

Electricity Telecom Transportation Water and Sanitation Total (% GDP)

Source: InterB

Investment in Infrastructure Brazil (% GDP)

0%

2%

4%

6%

8%

10%

12%

14%

16%

Level of investment necessary to

maintain the capital stock per capita

Level of investment in infrastucture

necessary to reach the current levels of

South Korea and other industrialized countries of East

Asia

Level of investment necessary to boost its economic growth and approach in 15-

20 years the advanced emerging

economies

Other Contries and its investments

4-6%

5-7%

Investment in Infrastructure (% GDP)

Brazil (2011-14) = 2.3

Brazil (2007) = 1.8

Peru (2001-6) = 1.5

India (2009-10) = 4.8

Chile (2001-6) = 4.6

Peru (2008-11) = 4.2

India (2005-09) = 4.1

India (2013-17) = 6.0

Chile (2008-11) = 5.1

Thailand (2009) = 15.6

Thailand (2003) = 15.4

China (2010) = 13.4

China (2003) = 7.3

Country growth requires more investments in infrastructure. In order for Brazil to boost its economic growth and

approach in 15-20 years the quality of infrastructure of advanced emerging economies, it needs to invest in

infrastructure approximately 6% of its GDP.

Corporate Presentation and 1Q16 Results 7

New Logistics Investment Program (PIL) of the Federal Govt.

198,4

86,4

66,1

37,4

8,5

Total

Railroads

Highways

Ports

Airports

PIL - 2015

7.000

7.500

Highways

Railroads

Source: www.logisticabrasil.com.br

until 2018 69,2 35%

After 2018 129,2 65%

Estimated investments in R$ billion

Total length to be invested (new and existing

concessions - in Km)

Corporate Presentation and 1Q16 Results 8

9



2. Company Overview

3. Business Units



10

Our Company

Complete in engineering products and services. in Brazil for more than 60 years.

With ability to plan, integrate services and products for the construction and industry

sectors. We invested in the professional qualification, together with diversified expertise,

to deliver fast, smart and reliable responses that increase the productivity of the

works and the results of our client.

National Coverage:17 States and Federal District in 32 locations

Construction: Focus on infrastructure, Industrial, residential and commercial

projects. Engineering solutions, sales and rental of concreting and shoring,

providing services of technical planning, project and supervision related to

equipment.

Rental: Rental and sale of motorized access equipment, such as aerial

working platforms and telescopic handlers to lift workers and cargos,

respectively.


In 2007. two private

equity funds. managed

by IP, and Axxon,

became our shareholders.

Acquiring, each one,

10%.

Paiva construction work

Sells Events Unit

Acquired Jahu Ltda

Initiates its Rental Unit

11

Company History

Joint Venture with Aluma

Systems Inc. of Canada

(until 2001)

First Brazilian

manufacture of

formwork by license

agreement with NOE-

Schaltechnik from

Germany

50`s

Catedral da Sé

Founded on 1952.

80`s

hydroelectric power plant Lajeado

90`s

Ferrovia do Aço

2000 2010

Maracanã Stadium

Mills’ IPO

Sale of the

Industrial Services

business unit

2013

Petrobras Oil platform

2016

Capital Increase. with the

issuance of 47,528,517

new common shares, in

the total amount of R$

124,999,999.71

Cable-stayed bridge BRT Transcarioca


12

What We Do?

Formwork

Shoring

Access

Special systems


13

Strengths and Competitive Advantages


“Best-in-class”

engineering and technical

capabilities and SLA

Know-how to work in complex projects, such as bridges, subways and hydroelectric

power plants;

Recognition of its differentiated services and reliability;

Market leader in its core business units

Largest footprint and fleet

in Brazil in all business

units

High capillarity: present in 17 States and Federal District in 32 locations;

114,000 tons of equipment in the Construction business unit vs 30,000 tons of

equipment of the second player;

6,100 equipment in the Rental business unit vs 2,900 equipment of the second player

Diversified revenue

streams

Diversified revenue base – serves several segments through its business units;

Rental: Construction 48% and Non-construction 37%

Heavy Construction: Urban Mobility 29%, Logistics 38%, Industrial 16%,

Others 17%

Real Estate: 57% Residential, 25% Commercial and Others 17%

Corporate Governance

Listed on Bovespa at the highest corporate level (Novo Mercado) since 2010;

Audited by “Big Four” Companies and currently by KPMG;

Professional Management

Strong brand name

and reputation

Undisputable track record, with more than 60 years of history;

Strong and long-term customer base – around 3,000 active contracts in all business

units

14

Lean Organizational Structure to Face Market Challenges

Ricardo Gusmão

Commercial Officer

for Construction

Avelino Garzoni

Engineering and

Operations Officer

Marcelo Yamane

Rental Executive

Gustavo Zeno

CFO and IRO

T.B.N

Human Resources

Executive

Sérgio Kariya

CEO

Construction

4135 4263

4501

1795 2008

1558

2010 2011 2012 2013 2014 2015

Headcount as of December 31 Shareholder Breakdown¹

Free Float 63,8%

Nacht Family 34,5%

Board of Directors and

Executive Officers 0,4%

Shares in Treasury 1,3%

(1) As of April 29. 2016


15



2. Company Overview

3. Business Units



16

Construction: Strategy and Growth Drivers

Growth Drivers Strategy

Country growth requires more investment in

infrastructure

Huge potential investment in infrastructure in Brazil

for upcoming years

Significant investment from basic industries

Increasing technical expertise requirements

Increasing penetration of industrialized formwork

Growing demand for full service solutions as

provided by Mills

Underdeveloped country in infrastructure

Mills’ equipment volume: approximately 114,000

tons

Equipment volume of 2º player in Brazil:

approximately 30,000 tons

Mills’ equipment volume is enough to supply

the market in Brazil and several markets in

Latin America.

Focus on larger. more complex projects with

differentiated services

For the commercial business, focus on small

industries and more complex projects other than

residential

Enhance relationship with midsized construction

companies

Careful selection and substantial investments in

training to maintain highly qualified staff, superior

to competition

Introduction of new products to ensure equipment

quality in line with top international standards

International Market: establishment of new

distribution channels and hiring of commercial

representatives

Brazilian market: development of sales partners in

the Real Estate market


17

Construction: Main Works with Mills Participation

States with Mills presence

North and Northeast

Corredor expresso Aguanambi (express

roadway)

Usina hidrelétrica São Manoel

(hydroelectric plant)

Ponte Tauape (bridge)

Vale’s S11D Project

Transposition of São Francisco River

CSN Plant

Salvador BA093 and Metropolitan

Southeast

Nova Tamoios Highway

Transbrasil

Sorocaba and São José

dos Campos Hospital

Galvani Mining Company

Cofins Airport Duplication

Sanitation project

Metropolitan Line 5 and

Line 6

Monorail Linha Ouro

Imigrantes Viaduct

Beltway

Central-west and South

Papuda Penitenciary

Guaíba Bridge - RS


18

Rental: Market Perspective

80 100 150 260 630

1540

2950

720

3218

4983

5866

8616

4567

425

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Volume of Equipment Purchased in Brazil

Source: Mills

64

165 174

1

14

Europe US CAN CHN BRA

Pote

ntia

l Mark

et

MEWP¹ Rental Fleet per 100.000 inhabitants

The market of aerial platform gained traction in 2007

with the revision of the Regulatory Safety Labor

Norm 18 (NR18), which establishes that workers

must be lifted with the use of motorized access

equipment and economic growth.

The current volume in Brazil (2015) is around 34,000

equipment, Mills owns approximately 6,100

equipment and the second player approximately

2,900.

MEWP¹: Mobile Elevating Work Platform

A measure of market maturity is to assess the ratio: MEWP rental fleet versus country

population


19

Rental: Strategy and Growth Drivers

Growth Drivers Strategy

Less than 20% of the Brazilian demand for

equipment is actually rented (vis-à-vis Europe –

80% and US – 50%)

Market penetration through substitution of less

secure and efficient access methods

Brazilian safety labor regulation driving demand

for AWP (NR-18)

Increasing client concern and demands for safety

and productivity

Immature market with low penetration

Largest asset base and geographic presence

Safest way to work on height

Surpass Customer expectations (Availability +

Reliability + Service Levels)

Best in Class Service Level Agreement

Differentiation through service

Focused on growing non-construction segment

Geographic expansion in the medium term

Sinergy with the Construction business unit


20



2. Company Overview

3. Business Units



275,5 340,4

238,2 334,9 347,9 343,8 360,3

125,4

163,9

171,6

209,1 231,5 202,6

108,3 1,5

11,3

13,9

16,2 42,3

38,2

31,5

2010¹ 2011¹ 2012¹ 2013¹ 2014² 2015³ LTM1Q16³

COGS SG&A ADD

21

Summary Financials

In R$ million

Net Revenue Costs and Expenses

Ebitda and Ebitda Margin Net profit

354.5

462.8

665.5

832.3 794.2

576.1 542.3

0,0

100,0

200,0

300,0

400,0

500,0

600,0

700,0

800,0

900,0

1000,0

2010¹ 2011¹ 2012¹ 2013¹ 2014 2015 LTM 1Q16

Rental Sales Technical assistance and others

168,4

217,4

339,0

419,3

340,7

161,2 142,8

47,5% 47,0%

50,9% 50,4%

42,9%

28,0% 26,3%

0,0%

10,0%

20,0%

30,0%

40,0%

50,0%

60,0%

0,0

50,0

100,0

150,0

200,0

250,0

300,0

350,0

400,0

450,0

2010¹ 2011¹ 2012¹ 2013¹ 2014² 2015³ LTM1Q16³

Ebitda Ebitda Margin

103,3 92,2

151,5 166,8

75,7

-60,1 -63,4

2010¹ 2011¹ 2012¹ 2013¹ 2014² 2015³ LTM 1Q16³

(1) Excluding Industrial Services business unit. sold in 2013.

(2) Excluding easy set formwork cost adjustments of R$ 14.6 million in 2014

(3) Excluding Construction impairment of R$ 30.9 million and Rorh impairment of R$26.2 million in 2015


22

Utilization Rate and Net Revenue

In R$ million

(*) Non segmentation of the utilization rate in the business unit Construction because the inventory of the equipment used in real estate and Infrastructure are shared

Volume: variation of the revenue due to the rented volume in tons (Construction) and quantity of machines(Rental) Price and Mix: variation of the revenue due to the variation of prices and

products mix.

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

1T10 3T10 1T11 3T11 1T12 3T12 1T13 3T13 1T14 3T14 1T15 3T15 1T16

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

1T10 3T10 1T11 3T11 1T12 3T12 1T13 3T13 1T14 3T14 1T15 3T15 1T16

Average LTM 1Q16 = 6..6%

50,3 4,2 6,3

39,7

4T15 Volume Preço e Mix 1T16

59,7 5,8

4,0 49,9

4T15 Volume Preço e Mix 1T16

Average LTM 1Q16 = 47.9%

Rental

Construction

Net Revenue Volume Utilization Rate

1Q10 3Q10 1Q11 3Q11 1Q12 3Q12 1Q13 3Q13 1Q14 3Q14 1Q15 3Q15 1Q16

1Q10 3Q10 1Q11 3Q11 1Q12 3Q12 1Q13 3Q13 1Q14 3Q14 1Q15 3Q15 1Q16

Volume Price and Mix 4Q15

4Q15

1Q16

Volume Price and Mix 1Q16


23

Free Cash Flow

In R$ million

¹Before interests paid referring to debentures and investment in rental.

² Before interests paid referring to debentures

Cash Flow

158,9 198,9

295,5

383,7 372,7

288,3

80,8

-208,9

-356,5

-31,2

-154,3

116,1

281,9

79,5

2010 2011 2012 2013 2014 2015 2016

Adjusted Operating Cash Flow¹ Adjusted Free Cash Flow²

Even on an adverse scenario. the Company remains generating free cash flow

Adjusted Operating Cash Flow¹ Adjusted Free Cash Flow2


Railways 12.7%

Airports and ports 4.6%

Highways 21.1%

Urban Mobility 28.8%

Sanitation 5.1%

Industrial 16.2%

Power 4.6% Others

7.0%

Public 39.7%

Private 47.3%

PPP 13.0%

24

Heavy Construction: Rental Revenue Breakdown In R$ million

Per Source of Resources

R$ 23.9 million

Per sector

R$ 23.9 million

Public: resources from the government

Private: resources from the private sector.

PPP (public–private partnership) : resources from the government and the private sector

Business Unit - Construction


Residential 57%

Commercial 25%

Others 17%

25

Real Estate: Rental Revenue Breakdown In R$ million

Rental Revenue Breakdown

R$ 15.8 million

Business Unit - Construction


26

Rental: Net Revenue Breakdown In R$ million

Net Rental Revenue per Use

R$ 49.9 million

Net Revenue per Type of Service

R$ 76.4 million

Construction 48%

Non-Construction

37%

Spot 15%

Rental 65%

used equip. sales 30%

Sales 2%

Others 2%

Technical Assistance

1%


27

Consolidated: Financial Performance

In R$ million

Due to the reduction of the investments and assets sales. the average capital invested tends to fall. since it illustrates the

average in the period.

ROIC (LTM)

Invested Capital: is defined as the sum of the equity plus third parties‘ capital (including all onerous. bank and nonbank debts) being both the average amounts in the last thirteen months.

1.144,0 1.109,9 1.066,5

1.020,7 972,9

517,8 507,9 496,1

485,1

466,6

1.661,8

1.617,7

1.562,5 1.505,8 1.439,5

4,0%

2,0%

0,8%

-2,9%

-3,8%

-12,0%

-10,0%

-8,0%

-6,0%

-4,0%

-2,0%

0,0%

2,0%

4,0%

6,0%

-100,0

100,0

300,0

500,0

700,0

900,0

1.100,0

1.300,0

1.500,0

1.700,0

1.900,0

1T15 2T15 3T15 4T15 1T16

Capital investido médio - imobilizado de locação líquido Capital investido médio - outros ROIC Average invested Capital – Net Rental PP&E Average Invested Capital - others

1Q15 2Q15 3Q15 4Q15 1Q16


28

Main Initiatives

ROIC LTM

-3.8%

Adjusted ¹-1.0%

NOPAT

(55.2)

(15.3)

Net Revenue

542.3

COGS

(199.2)

SG&A²

(257.4)

(200.3)

Depreciation: (166.8)

TI (rate of 30%) 24.3

7.2

Rohr Dividends 1.5

Invested Capital

1,439.5

Net Rental PP&E

972.9

Others

466.6

ROIC = NOPLAT/Average Invested Capital

¹ Excluding impairment (R$57.1 million) from NOPAT ² including ADD in the amount of R$ 26.3 million

Efforts to increase presence in the

international market

Sales of assets aiming at to real estate

market

Strengthen relationships with mid-sized

construction companies

Focus on non-construction markets for the

Rental unit

Continuous search for operational efficiency

and cost reduction

Closing of five branches of the Construction

unit in progress

Initiatives ROIC Decomposition

In R$ million


• Construction: -5.3%

• Rental: 5.1%

29

Summary Financials

In R$ million

2010¹ 2011¹ 2012¹ 2013¹ 2014² 2015³ LTM 1Q16³

Net Revenues

Mills 354.5 462.8 665.5 832.3 794.2 576.1 542.3

Construction 259.4 287.4 412.0 474.9 423.4 283.0 252.4

Rental 95.1 175.4 253.5 357.3 370.8 293.2 289.9

Ebitda

Mills 168.4 217.4 339.0 419.3 340.7 161.2 142.8

Construction 117.4 123.8 197.8 212.3 153.5 32.2 23.4

Rental 51.0 93.6 141.2 207.0 196.7 132.6 124.9

Others -9.5 -3.7 -5.5

Ebitda Margin

Mills 47.5% 47.0% 50.9% 50.4% 42.9% 28.0% 26.3%

Construction 45.3% 43.1% 48.0% 44.7% 36.3% 11.4% 9.3%

Rental 53.6% 53.4% 55.7% 57.9% 53.0% 45.2% 43.1%

Equipment Rental CAPEX

Mills 308.9 395.1 271.2 463.6 166.5 11.6 10.7

Construction 178.3 232.3 110.3 196.4 62.4 11.6 10.7

Rental 130.6 162.8 160.9 267.2 104.2 0.0 0.0

Covenants

EBITDA*/Net financial results >= 2.0 7,5 9,1 9,0 5,4 3,0

2.4

Net Debt/EBITDA* <=

3.0 1.6 1.2 1.4 1.5 2.1 1.5

(1) Excluding Industrial Services business unit. sold in 2013

(2) Excluding easy set formwork cost adjustments of R$ 14.6 million in 2014

(3) Excluding Construction impairment of R$30.9 million and Rorh impairment of R$26.2 million in 2015


30

Indebtedness

In R$ million

424

173 150 106 106

39

Cash position 2016 2017 2018 2019 2020+

574.3 56.8 631.1 423.5

207.5

Principal Interests Gross Debt Cash Net Debt

Principal Amortization Schedule

23,4%

74,3%

2.3%

IPCA CDI TJLP

31,2%

68,8%

Short Term Long Term

R$ 90 million already

paid in April/16

We do not have foreign currency exposure.

Indebtedness on 03/31/2016

17.1% 31.0% 21.9% 21.9% 8.0%

Participation of the balance due (principal) excluding payment made in April/16

Gross Debt Profile


Mills – Investors Relation

Phone: +55 (21) 3924-8768

E-mail: [email protected]

www.mills.com.br/ri

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