Mills' 2Q13 Result

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Main Indicators
Revenue
COGS G&A

EBITDA
Financial Indicators per Business Unit

Income Statement
Balance Sheet
Cash flow
Capex per Business Unit

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Mills - Main financial figures

in R$ millions

Net revenue
EBITDA
EBITDA margin (%)
Profit from continued operations
Profit from discontinued operations
Net earnings
ROIC (%)
Capex
Invested Capital

2Q12
(A)
156.3

1Q13
(B)
188.4

2Q13
(C)

(C)/(A)
%

(C)/(B)
%

1H12
(D)

1H13
(E)

(E)/(D)
%

211.8

35.5%

12.4%

304.6

400.2

31.4%

24.1%

3.4%

159.8

194.6

21.8%

52.5%

48.6%

79.7

95.7

98.9

51.0%

50.8%

46.7%

38.7

37.6

44.6

15.3%

18.4%

70.1

82.2

17.2%

0.6

1.6

3.5

507.1%

115.1%

1.8

5.1

186.2%

39.2

39.3

48.1

22.5%

22.4%

71.9

87.3

21.4%

13.6%

14.9%

14.2%

14.3%

14.5%

83.5

127.8

150.7

141.9

278.5

1,195.0

1,330.9

1,447.6

1,169.9

1,391.1

21.1%

8.8%

18.9%

Mills - Main financial figures of the pro forma results, considering the Industrial Services business unit
2Q12

1Q13

2Q13

(C)/(A)

(C)/(B)

1H12

1H13

(E)/(D)

in R$ millions

(A)

(B)

(C)

(D)

(E)

Net revenue

211.1

239.9

271.5

28.6%

13.2%

410.2

511.4

24.7%

84.4

102.0

107.5

27.3%

5.4%

170.7

209.4

22.7%

40.0%

42.5%

39.6%

41.6%

41.0%

EBITDA
EBITDA margin (%)

Reclassified, excluding Industrial Services business unit, for comparison.

Mills - Net revenue per type

in R$ millions

2Q12
(A)

1Q13
(B)

2Q13
(C)

(C)/(A)
%

(C)/(B)
%

1H12
(D)

136.1

160.1

166.9

22.7%

4.2%

264.9

3.0

4.3

8.0

164.1%

86.0%

5.9

Sales

12.2

17.2

26.6

118.2%

54.6%

23.0

Others

5.0

6.8

10.3

105.7%

50.8%

10.8

156.3

188.4

211.8

35.5%

12.4%

304.6

2Q13

Rental
Technical support services

Total net revenue

Mills - Net revenue per business unit

in R$ millions

2Q12

1Q13

Heavy Construction

41.9

26.8%

47.5

25.2%

55.1

26.0%

Jahu - Residential and Commercial Construction

58.9

37.7%

64.9

34.4%

66.5

31.4%

Rental

55.4

35.5%

76.1

40.4%

90.1

42.6%

156.3

100.0%

188.4

100.0%

211.8

100.0%

Total net revenue

Reclassified, excluding Industrial Services business unit, for comparison.

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1H13
(E)

(E)/(D)
%

327.0

23.4%

12.3

108.0%

43.8

90.5%

17.1

59.1%

400.2

1H12

31.4%

1H13

81.3

26.7%

102.6

25.6%

111.4

36.6%

131.3

32.8%

111.9

36.7%

166.3

41.5%

304.6

100.0%

400.2

100.0%

Mills - Cost of goods and services sold (COGS) and the general, administrative and operating expenses (G&A)
in R$ millions

Costs of job execution

2Q12

1Q13

2Q13

1H12

15.6

20.4%

19.5

21.0%

24.5

21.7%

28.4

Costs of sale of equipment

7.1

9.3%

12.1

13.0%

20.9

18.5%

13.2

Costs of asset write-offs

1.6

2.0%

0.9

0.9%

2.3

2.0%

2.9

Equipment storage

7.3

9.6%

9.1

9.8%

10.3

9.1%

14.3

COGS, ex-depreciation

31.6

41.3%

41.5

44.7%

57.9

51.3%

58.9

G&A

45.0

58.7%

51.3

Total COGS, ex-depreciation + G&A

76.5

100.0%

Reclassified, excluding Industrial Services business unit, for comparison.

92.8

55.3%
100.0%

54.9
112.9

48.7%
100.0%

85.9
144.7

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1H13

19.7%

44.0

21.4%

9.2%

33.0

16.0%

2.0%

3.1

1.5%

9.9%

19.4

9.4%

40.7%

99.4

48.3%

59.3%

106.2

100.0%

205.6

51.7%
100.0%

Mills - EBITDA per business unit

in R$ millions

Heavy Construction

2Q12
21.2

Total EBITDA
EBITDA margin (%)

1Q13

2Q13

1H12

26.6%

24.3

25.5%

25.1

25.3%

40.1

25.1%

34.1%

27.7

29.0%

24.6

24.8%

53.5

33.5%

31.4

39.3%

43.6

45.5%

49.3

49.8%

66.3

41.5%

79.7

100.0%

95.7

100.0%

98.9

100.0%

159.8

100.0%

27.2
Jahu - Residential and Commercial Construction
Rental

51.0%

50.8%

Reclassified, excluding Industrial Services business unit, for comparison.

46.7%

52.5%

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1H13

49.4

25.4%

52.3

26.9%

92.9

47.7%

194.6

100.0%

48.6%

Mills - Capex per business unit

Revised Budget

Realized
2Q12

1Q13

2Q13

in R$ millions

1H13

2013

(A)

(B)

Heavy Construction

24.0

21.7

28.8

50.5

89

Jahu - Residential and Commercial Construction

12.5

24.9

44.8

69.7

112

1.1

0.2

0.3

0.5

40.9

73.3

69.3

142.6

274

Industrial Services
Rental
Corporate
Organic growth
Acquisition
Total Capex

5.1

7.7

7.6

15.3

49

83.5

127.8

150.7

278.5

530

127.8

150.7

278.5

83.5

530

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Revised Budget
(A)/(B)
%
57%
62%
8%
52%
31%
53%
53%

Heavy Construction Business Unit - financial indicators

in R$ millions

2Q12

1Q13

2Q13

(C)/(A)

(C)/(B)

1H12

1H13

(A)

(B)

(C)

(D)

(E)

Net revenue
Rental

36.9

39.4

41.0

11.2%

4.0%

70.0

80.5

5.0

8.0

14.1

180.2%

75.8%

11.3

22.1

Total net revenue

41.9

47.5

55.1

31.5%

16.2%

81.3

102.6

EBITDA

21.2

24.3

25.1

18.2%

2.9%

40.1

49.4

EBITDA margin (%)

50.6%

51.3%

45.5%

49.3%

48.2%

ROIC (%)

17.8%

18.6%

17.8%

17.2%

18.1%

24.0

21.7

28.8

33.0

50.5

239.4

259.6

281.5

17.6%

8.5%

232.8

270.9

6.0

7.1

7.2

20.3%

1.1%

11.5

14.3

Technical support services, sales and others

Capex
Invested capital
Depreciation

Jahu - Residential and Commercial Construction Business Unit - financial indicators

in R$ millions

2Q12

1Q13

2Q13

(C)/(A)

(C)/(B)

1H12

1H13

(A)

(B)

(C)

(D)

(E)

Net revenue
Rental

48.5

53.3

52.0

7.2%

-2.4%

93.8

105.4

Technical support services, sales and others

10.4

11.5

14.5

39.1%

25.4%

17.6

26.0

Total net revenue

58.9

64.9

66.5

12.8%

2.5%

111.4

131.3

EBITDA

27.2

27.7

24.6

-9.5%

-11.4%

53.5

52.3

EBITDA margin (%)

46.1%

42.8%

37.0%

48.0%

39.8%

ROIC (%)

14.8%

12.8%

9.3%

15.2%

11.0%

12.5

24.9

44.8

27.8

69.7

365.9

413.2

448.2

22.5%

8.5%

356.3

431.2

7.8

8.9

9.6

23.5%

8.4%

14.9

18.5

Capex
Invested capital
Depreciation

Industrial Services Business Unit - financial indicators

in R$ millions

2Q12

1Q13

2Q13

(C)/(A)

(C)/(B)

1H12

1H13

(A)

(B)

(C)

(D)

(E)

24.7%

Net revenue
Maintenance

37.6

29.4

36.7

-2.4%

New plants

17.2

22.1

23.1

34.1%

4.7%

33.1

45.1

54.8

51.5

59.8

9.0%

16.1%

105.7

111.2

4.7

6.3

8.5

82.5%

35.7%

10.9

14.8

Total net revenue

EBITDA

72.6

66.1

EBITDA margin (%)

8.5%

12.2%

14.3%

10.3%

13.3%

ROIC (%)

3.9%

8.9%

16.4%

5.7%

12.5%

1.1

0.2

Capex

0.3

4.3

0.5

Invested capital

127.3

112.3

99.3

-22.0%

-11.6%

127.4

105.3

2.9

2.7

2.7

-6.8%

-0.5%

5.7

5.5

Depreciation

Rental Business Unit- financial indicators

in R$ millions

2Q12

1Q13

2Q13

(C)/(A)

(C)/(B)

1H12

1H13

(A)

(B)

(C)

(D)

(E)

Net revenue
Rental
Technical support services, sales and others
Total net revenue
EBITDA

50.6

67.3

73.8

45.8%

9.6%

101.1

141.2

4.8

8.8

16.3

240.9%

86.1%

10.7

25.1

55.4

76.1

90.1

62.6%

18.5%

111.9

166.3

57.1%

13.1%

31.4

43.6

49.3

66.3

92.9

EBITDA margin (%)

56.6%

57.3%

54.7%

59.2%

55.9%

ROIC (%)

16.3%

19.1%

18.5%

18.3%

18.7%

Capex
Invested capital
Depreciation

40.9

73.3

69.3

66.9

142.6

371.2

455.0

528.1

42.3%

16.1%

362.0

493.0

9.7

12.6

14.4

48.8%

14.8%

19.0

27.0

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(E)/(D)
%
15.0%
95.9%
26.3%
23.3%

16.4%
24.6%

(E)/(D)
%
12.3%
47.5%
17.9%
-2.2%

21.0%
24.3%

(E)/(D)
%
-9.0%
36.4%
5.2%
36.7%

-17.4%
-3.8%

(E)/(D)
%
39.6%
133.5%
48.6%
40.2%

36.2%
41.9%

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Mills - Income Statement
in R$ million

2Q12

1Q13

2Q13

Net revenue from sales and services

156.3

188.4

211.8

Cost of products sold and services rendered

(54.3)

(68.4)

(87.3)

Gross profit

102.0

120.0

124.5

General and administrative expenses

(45.7)

(52.9)

(56.8)

Operating profit

56.3

67.1

67.7

Financial expense

(9.9)

(11.3)

(16.8)

Financial income

0.9

2.1

5.0

Financial result

(9.0)

(9.2)

(11.8)

Profit before taxation

47.2

57.9

55.9

Income tax and social contribution expenses

(8.5)

(20.2)

(11.3)

Results of continued operations

38.7

37.6

44.6

0.6

1.6

3.5

39.2

39.3

48.1

126,149

126,492

127,120

0.31

0.31

0.38

Results of discontinued operations

Net income
Number of shares at the end of the period (in thousands)
Net income per shares at the end of the period (R$)

Reclassified, excluding Industrial Services business unit, for comparison.

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Mills - Balance Sheet
in R$ millions

2Q12

1Q13

2Q13*

2Q13

Assets
Current Assets
Cash and cash equivalents
Marketable securities

29.3

24.5

47.3

47.3

138.0

156.5

199.4

217.8

165.1

Inventories

15.0

29.9

30.9

30.9

Recoverable taxes

Trade receivables

27.5

26.5

35.8

35.8

Advances to suppliers

7.0

5.5

0.7

0.7

Derivative financial instruments

1.3

4.0

4.0

Assets available for sale

Other current assets

4.7

7.2

8.7

8.6

241.2

431.1

345.2

399.1

Trade receivables

2.5

2.1

2.1

2.1

Recoverable taxes

30.4

31.2

34.8

34.8

Total Current Assets

106.7

Non-Current Assets

Deferred taxes
Deposits in court

Investment

7.0

11.4

11.8

11.7

11.7

51.4

45.1

48.6

48.6

87.4

87.4

87.4

87.4

943.0

1,084.3

1,177.9

1,124.1

49.1

57.5

59.9

59.9

1,079.5

1,229.2

1,325.2

1,271.4

Total Non-Current Assets

1,130.9

1,274.3

1,373.8

1,319.9

Total Assets

1,372.1

1,705.4

1,719.0

1,719.0

in R$ millions

2Q12

1Q13

Property, plant and equipment

Intangible assets

2Q13*

2Q13

Liabilities
Current Liabilities
Suppliers
Borrowings and financings
Debentures
Salaries and payroll charges
Income tax and social contribution
Tax refinancing program (REFIS)
Taxes payable
Profit sharing payable
Dividends and interest on equity payable
Derivative financial instruments

47.3

58.5

70.1

70.1

114.9

38.5

15.7

15.7

4.6

17.8

110.6

110.6

32.1

33.3

36.6

23.8

5.8

0.8

0.8

0.9

0.9

0.9

0.9

10.5

7.7

10.7

10.7

7.9

4.1

10.8

10.8

18.8

36.2

20.4

20.4

1.6

Liabilities associated with assets available for sale

Other current liabilities

4.9

8.8

3.1

3.1

241.7

213.1

279.7

279.7

42.0

30.5

23.5

23.5

268.6

537.7

447.8

447.8

16.0

10.3

10.6

10.6

1.8

5.5

5.5

10.0

9.7

9.6

9.6

0.7

0.3

0.2

0.2

Total Non-Current Liabilities

337.3

590.4

497.3

497.3

Total Liabilities

579.0

803.5

776.9

776.9

Capital

533.6

539.5

548.8

548.8

Earnings reserves

211.3

321.4

321.0

321.0

2.2

4.7

4.7

Total Current Liabilities

12.7

Non-Current Liabilities
Borrowings and financings
Debentures
Provision for tax, civil and labor risks
Deferred taxes

Tax refinancing program (REFIS)

Other Liabilities

Stockholders' Equity

Capital reserves

(3.8)

Valuation adjustments to equity

1.1

(0.8)

2.9

2.9

50.9

39.6

64.6

64.6

793.1

901.9

942.1

942.1

1,372.1

1,705.4

1,719.0

1,719.0

Retained earnings
Total Stockholders' Equity
Total Liabilities and Stockholders' Equity

* Pro-forma result, including results for Industrial Service business unit.

Reclassified, excluding Industrial Services business unit, for comparison.

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Mills - Cash flow
in R$ millions

2Q12

1Q13

2Q13

Cash flow from operating activities

Net income before taxation

47.8

60.4

60.5

Adjustments
Depreciation and amortization

26.4

31.3

34.0

Provision for tax, civil and labor risks

1.0

0.5

0.5

Accrued expenses on stock options

0.9

2.0

2.5

Profit sharing payable

4.3

4.0

6.8

(6.1)

(10.2)

(11.5)

Interest, monetary and exchange rate variation on loans, contingencies and deposits in court

8.9

12.6

14.5

Allowance for doubtful debts

3.8

5.0

2.7

Gain on sale of property, plant and equipment and intangible assets

Others

(0.1)
39.0

45.3

49.4

Changes in assets and liabilities

Trade receivables

(20.2)

(9.1)

(21.1)

Inventories

0.1

(3.0)

(0.9)

Recoverable taxes

3.9

14.9

(1.4)

Deposits in court

(0.5)

0.0

0.1

Other assets

(4.9)

0.4

(0.7)

Suppliers

(2.0)

2.4

(2.5)

5.8

5.7

3.3

Taxes payable

(0.6)

(10.9)

3.0

Other liabilities

1.0

1.6

(7.6)

(17.4)

2.1

(27.8)

Salaries and payroll charges

Cash from operations

69.4

Interest paid

(19.0)

Income tax and social contribution paid

(16.2)

Profit sharing paid

Lawsuits settled
Net cash generated by operating activities

107.7

82.2

(7.9)

(12.8)

(8.9)

(17.7)

(20.0)

(0.1)

(0.1)

(0.2)

70.8

51.4

34.2

Cash flow from investment activities

Marketable securities
Purchases of property, plant and equipment and intangible assets (*)
Proceeds from sale of property, plant and equipment and intangible assets
Net cash generated by (used in) investing activities

(53.9)

21.6

138.0

(119.5)

(136.7)

9.5

8.3

25.3

(44.5)

(89.7)

26.7

Cash flow from financing activities

Capital contributions
Dividends and interest on capital invested paid

5.6
(21.9)

1.9

9.3

(36.2)

Repayment of borrowings

(7.1)

(3.7)

(28.6)

Borrowings raised

32.7

1.0

0.1

9.3

(0.9)

(55.4)

Increase (decrease) in cash and cash equivalents

(1.0)

(19.7)

22.8

Cash and cash equivalents at the beginning of the period

30.3

44.2

24.5

Cash and cash equivalents at the end of the period

29.3

24.5

47.3

Net cash generated by (used in) financing activities

(*) PIS and COFINS credits are included in total purchases of property, plant and equipment and intangible assets.