profarma 4 q11

2

4Q11 and 2011 Earnings Release

March, 14th, 2012

3

Highlights in the Period

• Profarma celebrated the 5th anniversary of its IPO in the year of its own 50th anniversary. Based on its results-oriented culture

and practical initiatives designed day by day, the Company seeks to continue consolidating its prominent position in the

distribution industry in Brazil;

• In 2011, Profarma took a major stride in its growth strategy by acquiring Prodiet Farmacêutica. In the first quarter after the

acquisition (4Q11), Prodiet recorded gross operating revenues of R$ 84.2 million and EBITDA margin of 4.6%, which helped

Profarma improve its profitability and fuel its long-term sustainable growth;

• Concerning the Company’s organic growth, it is worth noting the health and beauty segment, whose sales rose for the eighth

straight quarter. There was a year-over-year increase of 63.9%;

• It is also worth noting the generics category, whose sales climbed by 19.9% year-over-year;

• Consolidated operating expenses fell by 0.4 percentage point in relation to 2010 and totaled 7.3% of net operating revenues;

• The positive consolidated operating cash flow amounted to R$ 29.9 million in 2011, or 1.1% of net operating revenues;

• Sales through electronic orders reached an all-time high and accounted for 69.7% of total sales in 2011.

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Gross Revenues Evolution

(R$ million)

4Q10 4Q11 2010

3,132.8

832.3928.5

2011

3,317.0

5

Gross Revenues Breakdown

(R$ Million)

Branded

Generic

OTC

Health and Beauty Products

Hospitals and Vaccines

Total

4Q11

536.6

82.1

129.1

66.4

114.3

928.5

4Q10

554.6

59.6

151.4

43.9

22.7

832.3

Chg. %

-3.3%

37.6%

-14.7%

51.2%

404.2%

11.6%

2011

2,083.0

263.1

545.8

233.2

191.9

3,317.0

Chg. %

0.0%

19.9%

-7.6%

63.9%

98.7%

5.9%

2010

2,083.4

219.5

590.8

142.3

96.6

3,132.8

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(R$ million and % Net Revenues)

Gross Profit and Revenues from Services to Suppliers

Gross Profit Revenues from Services to Suppliers Gross Profit Margin(%)

4Q10 4Q11 2011

28.4

41.7

123.9

163.7

10.1% 10.2%10.6%

45.0

38.6

2010

100.3

181.1

10.7%

7


Operating Expenses - SGA

4Q10 4Q11 2011

51.5

204.5

7.4%7.3%

7.0%

55.7

2010

202.0

7.7%

8


Ebitda and Ebitda Margin

4Q10 4Q11 2011

18.6

75.9

2.7%2.7%

3.2%

25.1

2010

79.9

3.0%

9


Net Financial Expenses

4Q10 4Q11 2011

6.1

31.2

0.9%1.1%1.1%

8.4

2010

28.6

1.1%

10


Net Profit

4Q10 4Q11 2011

10.5

2010

34.4

1.5%

1.0%1.1% 1.3%

28.9

8.7

11

Cash Flow Generated / (Used) in Operating Activities

Internal Cash Generation

Operating Assets Variation

Trade Accounts Receivable

Inventories

Suppliers

Other Items

Cash Flow (Used) in Investing Activities

Cash Flow Generated / (Used) by Financing Activities

Net Increase / (Decrease) in Cash

(R$ Million) 4Q11 4Q10 Chg. % 2011 Chg. %2010

Summary of Cash Flow

15.1

17.7

(2.6)

(106.1)

(71.2)

194.7

(20.0)

(10.4)

(2.5)

2.2

(21.3)

22.2

(43.5)

(16.4)

(64.7)

68.5

(30.9)

(3.3)

(15.5)

(40.1)

-

-20.6%

94.0%

-546.6%

-10.0%

184.2%

35.2%

-215.0%

83.9%

-

29.9

66.4

(36.5)

(75.3)

(31.6)

67.2

3.3

(15.9)

(2.7)

11.2

-32.7%

-2.2%

-55.5%

-85.3%

-2,546.2%

48.8%

-

-96.3%

93.9%

-

44.4

67.9

(23.5)

(40.6)

(1.2)

45.1

(26.8)

(8.1)

(43.8)

(7.5)

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* Average

Cash Cycle - Days *

4Q10

49.0

43.6

52.0

46.6

4Q11

48.0

46.0

48.9

46.8

Accounts Receivable (1)

Inventories (2)

Accounts Payable (3)

(1) Average of Gross Revenues in the Quarter

(2) Average of COGS in the Quarter

(3) Average of COGS in the Quarter

13

Indebtedness:

Net Debt and Net Debt / Ebitda*

(R$ million)

2011

1.6x

2010

108.7

1.4x

* Ebitda = accumulated last 12 months

118.9

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Capex

4Q10 4Q11 20112010

* Prodiet investiments are not included.

3.5

9.3*

0.5% 0.3%0.5%

3.7

8.3

0.3%

15

Service Level

(Units served / Units Requested)

4Q10

88.1%

2011

89.3%

4Q11

89.3%

2010

90.1%

Logistics E.P.M.

(Errors per Million)

20114Q11 2010

170.0

4Q10

114.0

150.0

184.0

16

16

85

90

95

100

105

110

115

30-Sep-11 30-Oct-11 29-Nov-11 29-Dec-11

Ibovespa Profarma

108108

Profarma vs Ibovespa - % 4Q11

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Company Analyst Telephone E-mail

Analyst Coverage

Merrill Lynch Mauricio Fernandes (55 11) 2188-4236 [email protected]

Credit Suisse Marcel Moraes (55 11) 3841-6302 [email protected]

Banco Fator Iago Whately (55 11) 3049-9480 [email protected]

Raymond James Guilherme Assis (55 11) 3513-8706 [email protected]

BTG Pactual João Carlos dos Santos (55 11) 3383-2384 [email protected]

Marcio Osako (55 11) 3073-3040 [email protected]ú BBA

Javier Martinez de Olcoz Cerdan (1 212) 761-4542 [email protected]

Clarissa Berman (55 11) 3048-6214 [email protected] Stanley

Juliana Rozenbaum (55 11) 3073-3035 [email protected]

Andre Parize (55 11) 5171-5870 [email protected]

Marco Richieri (55 11) 5171-5873 [email protected]

profarma 4 q11

Economy & Finance