1Q08 presentation

Agenda

Results Presentation

Ricardo Vianna (CFO and IRO)

Eduardo de Come (Financial Officer)

Brazilian Biodiesel Market

With the mandatory adoption of B2, all diesel sold in Brazil as from January 1st, 2008

contains a blend of at least 2% biodiesel.

In the first three months of 2008, 10.38 million m³ of (B2 or Bx) diesel were sold. We can

perceive a 7.6% increase in the total sales volume of diesel fuels.

It was necessary to increase the imported volume of diesel, which amounted to 402,600 m³.

0

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10.000.000

15.000.000

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25.000.000

30.000.000

35.000.000

40.000.000

45.000.000

2000 2001 2002 2003 2004 2005 2006 2007 2008

Diesel B2


Brasil Ecodiesel’s sales were 14.79% higher compared with the 4Q07, totaling 86,968 m³.

The increased consumption of B2 in the beginning of 2008 forced Petrobras to held another

auction for acquisition of biodiesel for strategic inventories – the second auction, in which the

Company’s selling price presented a 14% increase in relation to the prior auction carried out by

Petrobras.

FOB Sales CIF Sales* CIF Sales*

ANP Auction Petrobras Auction I Petrobras Auction II

Delivery 01/01 to 06/30 01/01 to 02/29 04/07 to 06/20

Unit Vol (m

3)

Average Price** Vol (m3)

Average Price**

Vol (m3)

Average Price**

Iraquara (BA) 41,000 1,837.56 10,000 2,255.00 4,000 2,560.00

Itaqui (MA) 43,000 1,875.80 7,900 2,297.41 9,000 2,623.33

Porto Nacional (TO) 35,000 1,837.97

Rosário do Sul (RS) 42,000 1,840.17

Crateús (CE) 18,000 2,306.94

Floriano (PI) 2,000 2,665.00

Total 161,000 1,848.54 35,900 2,290.38 15,000 2,612.00

* Deliveries in basis DECAL (EP) and Candeias (BA).

** Without ICMS tax.


On March 14 the CNPE raised the biodiesel ratio in the diesel blend to 3% as from July 1

this year.

On April 10 and 11, the ANP held new auctions for biodiesel supply in the 3Q08. The

average selling price of Brasil Ecodiesel was 48.2% higher than in the auctions of November

2007.

The Ministry of Mines and Energy (MME) estimates that the B3 blend will result in an

annual demand of approximately 1.3 million m³ of biodiesel, with a positive impact on Brazil’s

balance of trade through the reduction in imported diesel fuel.

FOB Sales

ANP Auction

Unit Vol (m3) Average Price*

Iraquara (BA) 21,600 2,739.99

Itaqui (MA) 19,800 2,739.99

Rosário do Sul (RS) 21,600 2,738.99

Total 63,000 2,739.65

*Delivery until 09/30/2008.

17,109 18,773

26,005 26,718

45,370

55,052

71,825

16,933

72,721

43%39%

31%

56%

42%46%

66%

47%

39%36%

62%61%57%

55%

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National Biodiesel Production % Produced by Ecodiesel


Brazilian biodiesel production in clear expansion

The domestic production of biodiesel in the first two months of 2008 amounted to

144,5 m³, 37% of which were produced by Brasil Ecodiesel.

In accordance with preliminary estimates by the MME, biodiesel production totaled

238,000 m³ from January to March 2008.

Source: ANP

Vegetable Oil Market

The market for the main vegetable oils produced worldwide continued to climb in early-

2008.

Soybean oil, the main oil used for production of biodiesel in Brazil, showed an increase of

5.38% in 1Q08. Over the past 12 months, soybean oil appreciated 56.3%. The impact on

Brazilian prices was partially offset by the 33.4% period appreciation of the Real.

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ton

Soybean

Rapessed

Palm

Sunflower

Castor

Vegetable Oil Market

According to Abiove, Brazilian soybean production should reach 61.3 million tonnes in the

2008/2009 harvest, showing a 4% growth when compared to the previous harvest.

With this production, it would be possible to produce nearly 11.5 million m³ of soybean oil,

however the Brazilian demand is only 4.0 million, of which approximately 3.0 million are

destined to the food market and only 1.0 to biodiesel production, according to MME (Ministry

of Mines and Energy).

2008/ 2008/ 2008/

2006/ 2007/ 2008/ 2009 2006/ 2007/ 2008/ 2009 2006/ 2007/ 2008/ 2009

2007 2008 2009 F % 2007 2008 2009 F % 2007 2008 2009 F %

Initial Stock 1,220 2,289 2,027 -11% 818 864 862 0% 272 311 291 -6%

Production 56,942 58,726 61,300 4% 22,021 24,111 24,800 3% 5,512 6,047 6,200 3%

Importation 40 108 100 -7% 193 111 100 -10% 26 101 50 -50%

Internal Consumption 9,944 11,325 11,800 4% 3,238 3,647 4,100 12%

Export 56,942 23,805 27,300 15% 12,224 12,899 13,100 2% 2,261 2,521 2,150 -15%

Processing 40 31,511 32,400 3%

Stocks End 2,289 2,027 1,500 -26% 864 862 862 0% 311 291 291 0%

0%Seeds/ Losses 1,220 2,700 2,700

Grains Meal Oil

Energy x Food

Over the past months, the discussion on energy x food grew stronger concerning the

destination to agricultural production.

The biofuels are not the cause to the increase in food prices. The factors which

determined such an increase are much more structural, such as:

1. The higher food demand and the increase in population in a lot of places, like China;

2. Increases in oil prices, impacting production costs (fertilizer and transport);

3. Some of the main international producers, such as Australia, have undergone severe

draughts that affected the production;

4. The growth of production of ethanol from corn in the US, reducing the corn used to food

and replacing land.

5. The history of subsidies to the agricultural sector and import fees imposed by developed

countries, especially the USA and the European Union.

6. The speculative component – the operation of speculative funds in the commodities

sector as a way to maintain profitability;

According to IBGE (Brazilian Institute for Geography and Statistics), Brazil has 152 million

hectares of agricultural land, 62 million of which in use; therefore, there are 90 million

hectares left to expand agriculture with no need for deforestation.

Plantations

We concluded the summer planting of 5,300 hectares of jatropha curcas on our own land,

giving a total of 7,945 hectares planted with this crop, part of which jointly with castor,

especially on some of the land acquired in 2007 in the state of Bahia.

We emphasize our strategy of its own production of vegetable oils for alternative crops

aimed at reducing our exposure to soybean oil.

City Total Area Legal Reserve Planted Area Area available for planting

Crateús / CE 3.980 ha. 796 ha. 899 ha. 2.285 ha.

Parambu / CE 12.394 ha. 2.479 ha. 205 ha. 9.710 ha.

Alvorada / PI 7.754 ha. 1.550 ha. 1.426 ha. 4.778 ha.

Setubinha / MG 2.622 ha. 524 ha. 515 ha. 1.583 ha.

Irecê / BA 19.802 ha. 3.960 ha. 4.900 ha. 10.942 ha.

46.552 ha. 9.309 ha. 7.945 ha. 29.298 ha.

Plantations

Jatropha Curcas Plantation

in our farms

Minas Gerais

Bahia

Plantations

Minas Gerais

Operating Performance

Brasil Ecodiesel produced 70,719 m³ of biodiesel and sold 86,968 m³ in 1Q08, supplied

with stocks maintained by the Company at the end of 2007.

Despite the increased sales and the higher prices seen last quarter, with a consequent

increase in revenue, the upturn in the cost of vegetable oil, pushed up production costs,

jeopardizing financial results.

1Q07 4Q07(*) 1Q08(*) % 1Q08 / 4Q07

Gross Revenue 61,130 160,517 202,794 26.33%

Net Revenue 48,290 134,277 167,264 24.57%

COGS -44,762 -139,457 -180,313 29.30%

Gross Income 3,528 -5,181 -13,049 151.86%

Gross Margin 7.30% -3.90% -7.80% 100.00%

Lucro (Prejuízo) Líquido -526 -24,352 -14,925 -38.71%

Margem Líquida -1.10% -18.10% -8.90% -50.83%

Sales (m³) 27,697 75,763 86,968 14.79%

Average price (with ICMS) 2,165.31 1,967.00 2,290.20 16.43%


• Adjusted gross revenue stood at R$202.8 million in 1Q08, of which 98.2% (or R$199.2

million) came from the sale of 86,968 m³ of biodiesel and the remainder from the sale of

byproducts, especially glycerin and fatty acids.

Biodiesel Floriano Crateús Iraquara Porto

Nacional Rosário do Sul

Itaquí Total

1Q07 9,243.1 8,124.4 10,329.6 - - - 27,697.1

4Q07 6,947.41 12,357.19 18,520.36 10,690.42 13,717.82 13,529.81 75,763.00 Sales (m

3)

1Q08 2.00 16,274.49 23,700.74 11,516.23 14,521.49 20,953.45 86,968.41

1Q07 19,954.10 7,177.00 22,841.70 - - - 59,972.9

4Q07 13,670.52 24,293.13 36,409.36 21,020.00 27,004.83 26,628.22 149,026.05 Revenue (R$ ‘000)

1Q08 9.42 42,337.97 54,033.34 24,052.79 30,613.11 48,128.64 199,175.27


Net Revenue totaled R$167.3 million in the first quarter.

The Cost of Goods Sold stood at R$180.3 million in 1Q08, R$179.8 million of which

from biodiesel sales.

In 1Q08, General and Administrative Expenses stood at nearly 14.2% below the

previous quarter, mainly due to the nationalization of the Company’s expenses.

Tax expenses : R$1.6 million in 1Q08.

Other Operating Revenues: we recorded an additional net operating revenue of R$20.0

million in the 1Q08, 90% of which related to fines to be paid by our clients for failure to

remove biodiesel from our plants.

We recorded net financial expenses of R$9.9 million in 1Q08, chiefly due to the

payment of charges related to short term loans (working capital).

We posted a net loss of R$14.9 million in 1Q08, primarily due to the increase in

production costs, especially in vegetable oil, against low average sale prices, due mainly

to the outcome of auctions held by ANP in November 2007.

Cash and Investments

Details of Use of Funds (R$ ‘000)

Most of cash and investments are in working

capital due to the higher operating volume of

the company;

The Company’s net debt totaled R$229.9

million on March 30th.

INDEBTEDNESSWorking Capital

& Inventory

68%

Other

4%

Oil Extraction

17%

R & D

4%

Units of

Biodiesel

2%Agriculture

5%

R$ 40,7

millions

Indebtedness (R$ ‘000) 4Q07 1Q08

Short term R$ 141,245 R$ 205,022

(+) Long term R$ 36,715 R$ 30,778

(=) Total Indebtedness R$ 177,960 R$ 235,800

(-) Cash and cash equivalents R$ 298 R$ 5,898

(=) Net Debt R$ 177,662 R$ 229,902

Capital Markets

ECOD3 performance

ECOD3 (R$ /share) 1Q07 2Q07 3Q07 4Q07 1Q08

Open 11,81 9,24 12,27 11,91 6,99

Low 8,77 8,80 9,51 6,01 3,84

High 12,65 14,50 15,39 12,17 7,01

Average 10,95 11,57 12,86 8,67

Close 9,15 12,27 11,89 6,89 4,55

% in quater -22,5% 34,0% -3,1% -42,1% -34,0%

Volume (R$ MM) 1Q07 2Q07 3Q07 4Q07 1Q08

Total 117,69 182,70 144,83 116,55 170,08

Daily Average 1,93 2,95 2,30 1,98 2,83

Transactions 1Q07 2Q07 3Q07 4Q07 1Q08

Nº of share (un.) 10.750.400 15.793.000 11.265.800 13.446.300 34.075.000

Nº of transaction (un.) 10.878 19.816 13.700 13.793 25.994

Capital Markets

ECOD3 performance in the 4Q07

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ECOD3 IBOV

Investor Relations

Ricardo Luis de Lima Vianna

CFO and IRO

Marcos Leite

Investor relations

Phone: +55 21 2546-5031

Website: www.brasilecodiesel.com.br/ir

Disclosure

• This document may contain prospective statements, which are subject to risks and uncertainties, as they were based on the expectations of Company’s management and on available information. These prospects include statements concerning the Company’s current intensions or expectations for our clients; this presentation will also be available on our website www.brasilecodiesel.com.br/ir and also in the IPE system at the Brazilian Security Exchange Commission – CVM.

• Forward-looking statements refer to future events which may or may not occur. Our future financial situation, operating results, market share and competitive positioning may differ substantially from those expressed or suggested by said forward-looking statements. Many factors and values that can establish these results are outside Company’s control or expectation. The reader/investor is prevented not to completely rely on the information above .

• The words “believe", “can", “predict", “estimate", “continue", “anticipate", “intend", “forecast" and similar words, are intended to identify affirmations. Such estimates refer only to the date in which they were expressed, therefore Company has no obligation to update said statements.

• This presentation does not consist of offering, invitation or request of subscription offer or purchase of any marketable securities. And, this statement or any other information herein, does not consist of a contract base or commitment of any kind.

1Q08 presentation

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