Profarma 3q13

3Q13 Earnings Release

November 14, 2013

Highlights in the Period

• Consolidated EBITDA amounted to R$29.1 million, rising considerably by 32.0% in relation to 3Q12, with EBITDA margin

of 3.3%, the highest in the last 4 years;

• Consolidated gross revenues amounted to R$1.0 billion in 3Q13, up 5.4% year-over-year;

• The Hospital & Specialties division’s gross revenues shot up by 28.9% year-over-year;

• The Retail division, which comprised only Tamoio Drugstore Chain in 3Q13, recorded gross revenues of R$92.9 million,

up 16.8% from 3Q12, with EBITDA margin of 5.7%;

• On September 26, 2013, Profarma acquired the remaining 40% portion of Prodiet Farmacêutica S.A., in addition to the

60% stake acquired in 2011. The total acquisition amount corresponds to an EV/EBITDA multiple (2014E) of 5.6x;

• On September 25, 2013, Profarma concluded the acquisition of Drogasmil/Farmalife Chain (CSB Drogarias). Only the

assets and liabilities amounts were consolidated in 3Q13 due to the date on which the transaction was concluded. Income

statement figures will be consolidated with Profarma’s as of 4Q13.

Gross Revenues Evolution

(R$ million)

957.7

3Q12

830.6

127.1

1,016.9

2Q13

854.0

162.9

3Q13

845.2

163.9

1,009.1

Pharmaceutical Distribution Hospital & Specialties Retail

12.0%

10.7%

12.9%

(R$ million and % Net Revenues)

Gross Profit and Revenues from Services to Suppliers

3Q12

31.1

56.2

30.4

74.2

3Q13 2Q13

31.3

82.5

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

3Q13

74.5

3Q12

64.0

2Q13

79.0

9.0%

7.9% 8.6%


Operating Expenses - SGA

3Q12

22.1

2Q13

33.1

3Q13

29.1


Ebitda and Ebitda Margin

3.8% 3.3%

2.7%

3Q13

17.9

3Q12

4.7

2Q13

11.5


Net Financial Expenses

0.6%

1.3%

2.1%


Net Profit

0.6%

1.3% 1.4%

3Q12

10.8

12.6

2Q13 3Q13

5.4

(R$ Million)

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

Summary of Cash Flow

3Q13

(4,5)

20,7

(25,2)

87,1

36,8

(119,2)

(29,8)

(9,1)

(9,5)

(23,1)

3Q12

6,1

20,7

(14,6)

(36,2)

36,0

(7,4)

(7,1)

(3,9)

(10,0)

(7,8)

Chg. %

-

-

-72,4%

-

2,1%

-

-322,4%

-134,4%

4,9%

-195,3%

2Q13

(31,6)

23,6

(55,2)

28,0

(14,4)

(88,2)

19,4

(78,8)

72,4

(38,0)

Chg. %

85,7%

-12,0%

54,3%

211,0%

-

-35,1%

-

88,4%

-

39,0%

* Average

(1) Average of Gross Revenues in the Quarter

(2) Average of COGS in the Quarter

(3) Average of COGS in the Quarter

Cash Cycle - Days *

Accounts Receivable (1)

Inventories (2)

Accounts Payable (3)

3Q13

48.7

48.5

42.7

54.5

2Q13

56.3

55.1

49.1

47.9

3Q12

56.1

48.8

41.9

34.5

(R$ milllion)

Indebtedness: Net Debt and Net Debt / Ebitda

3Q13

432.8

3Q12

203.1

2Q13

359.4

2.1x

3.3x 3.9x

3Q13

0,5

3Q12

3,9

2Q13

1,7


Capex

0,2% 0,5%

0,1%

Service Level

(Units served / Units Requested)

Logistics E.P.M.

(Errors per Million)

3Q12

89.2%

3Q13

91.4%

2Q13

88.9%

3Q12

90.0 103.9

3Q13 2Q13

118.0

Gross Revenues R$ million

92.9

Op. Exp.

Total

Gross

Margin

Ebitda

Margin

Net

Margin

23.9%

29.8%

Financial DataTamoio – 3Q13

(R$ million e % Gross Revenues)

59

8

8.9%

25.52

525.1

60.7

# of stores

Store Openings

1 SSS Mature Stores (more than 36 months)

Average Ticket (in reais)

Monthly Average Store's Sales

Revenues per Employee

1- Same Store Sales

10.0% 1 SSS

Operational Data Tamoio – 3Q13

(R$ thousands)

5.7% 4.1%

Turnover - PFRM3 PFRM3 IBOV Index IGCX Index

Stock Performance

100

12.7

10.3

6.9

100

Analyst Coverage

Company Analyst Phone number Email address

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

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

Juliana Rozenbaum (55 11) 3073-3040 [email protected] Itaú BBA

Javier Martinez de Olcoz (55 11) 3048-6088 [email protected] Morgan Stanley

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

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

Banco Fator Pedro Ivo Barreto Zabeu (55 11) 3049-9478 [email protected]

Guilherme Assis (55 11) 3206-8285 [email protected] Brasil Plural

Profarma 3q13

Economy & Finance

Transcript of Profarma 3q13