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Corporate Presentation

and 3Q16 Results

Corporate Presentation and 3Q16 Results

1. Market Overview

2. Company Overview

3. Business Units

4. Financial Profile

Corporate Presentation and 3Q16 Results

Economic Overview
A slight improvement of market expectation, as presented below, can indicate a possible closure of an unprecedented
recession period.

GDP Growth

2015-2016 GDP Estimate

In % per year

In %
0.5

7.6

7.5
5.9

4.9
3.5

5.0

4.2
4.1
3.4

3.2

6.0

5.7
4.4

4.0

3.9

3.1

2.7

2.5

1.8

3.1
1.0
0.4

-0.1

-0.5

0.5

1.3

1.3 1.2

-0.2

0.1
-3.2
-3.9
-3.4

-3.2

2015

2016

-3.8

According to market expectations, Brazil has likely reached


the bottom in 2016.

1-may-

1-apr-

1-mar-

1-feb-

1-jan-

1-dec-

1-nov-

1-oct-

1-sep-

2020E

1-aug-

2015

1-jul-

2010

1-jun-

2005

1-may-

2000

1-apr-

1995

1-mar-

1990

1-feb-

1985

1-jan-

-3.8

Expectations have deteriorated in 2015 and early 2016,


but are rebounding in the first months of the Temer
government.

Source: Brazilian Central Bank (historical series); Focus Report until 9/9/2016; Market Expectations Systems (9/9/2016)

Corporate Presentation and 3Q16 Results

Economic Overview
After strong market deterioration, political uncertainty and lack of confidence, there is an overall improvement of expectation
in the medium term.
Delinquency Rate
SELIC
In %

In %, end of period
7.7
6.7
12.8
10.0

6.8

6.3

6.6

6.5

6.3

3.7

3.6

3.5

5.7

11.8

11.0

7.5

10.0

8.8

4.5
8.5

8.5

4.0

8.5

7.3
4.0

3.9

3.5

3.1

3.4

2018E

Legal Entity

2017E

2016E

2015

2014

2013

2012

2011

2010

2009

2020E

2019E

2018E

2017E

2016E

2015

2014

2013

2012

2011

2010

2009

Private Entity

Inflation rates

3.2

4.5

2019E

3.8

6.2

4.7

2020E

10.8

7.2

2021E

7.7

-4.3p.p.
14.3

Business Confidence

(%YoY)

10.7
9.3

4.5

4.5

4.5

5.0

4.5

4.5

54

+ Positive
Environment
Environment
Negative

47

46
50
36

IPCA
2019E

2017E

2016E

2015

2014

2013

2012

2011

2018E

IGPM

-1.7

2010

5.0

jul-16

5.0

2016

5.2
3.7

2009

5.0

2015

5.0

7.0
5.5

5.1

6.0

2014

10.5

2013

6.4

2012

5.9

2011

4.3

5.8
7.8

2021E

6.5

2020E

5.9

2010

11.3

Source: Santander (Jul/2016); Bradesco (Aug/2016)

Corporate Presentation and 3Q16 Results

Investments in infrastructure
It is known that investment in infrastructure is historically low in Brazil and still far from the levels seen in developing
countries.

Investment in Infrastructure

Investment in Infrastructure in Brazil

(% GDP)

(% GDP)

China
(2010)

5.4
0.5

13.4

ndia
(2013Chile
17) Costa Rica
(2008- Uruguai
(2013)
Nicaragua
11) (2013)
(2013) Bolvia
(2013)

6.0

5.5

5.1

5.1

4.9

2.0

3.6
0.2

0.8

Brazil
(2011-14) EUA
Peru
2.3
(2013) (2001-16)
4.5
2.0
1.5

1.5

2.3
0.2
0.6

0.4

2.1
0.2

0.7

2.3
0.2

0.6

0.9

0.7

0.5

2.1

1.5

0.8

0.6

0.7

1971/80

1981/89

1990/2000

2001/10

2011/14

Electricity

Telecom

Transportation

Water and Sanitation

Total (% GDP)

Source: Cepal, CNI (Confederao Nacional da Indstria); US Senate; press clipping

Corporate Presentation and 3Q16 Results

Brazil lags behind other BRIC countries


in quality of infrastructure
There is a significant demand for better infrastructure in Brazil, which can reduce the countrys growth bottleneck. The
quality of Brazils highways, railways, ports and air transport are very poor, increasing the cost of Brazil.
Infrastructure quality ranking for BRIC countries
(2014-2015)
Index 1.0 (best)

Railways

Highways

China

China

0.7

India

0.6

India

0.6

Russia

Russia

Brazil

0.4

Brazil

0.8

China

0.6

0.4

USA

0.7

India

Russia

USA

Air Transport

Ports

0.2

Brazil

0.7

USA

China

0.6

India

0.6

Russia

0.6

Brazil

0.4

0.8

USA

0.7

0.6

0.6

0.5

0.9

Source: The Global Competitiveness Report 2015-2016

Corporate Presentation and 3Q16 Results

PPI: Infrastructure will play a major role in the Federal


Governments plan
The Temer Government announced a new package for concessions a great portion of the projects was already included in
the Investment Program in Logistics (PIL)
Number of concessions per sector

Mine and Electricity


18

2017

2018

3 oil and gas

1 powerplant

Investment prospects in the infrastructure sector


In R$ bi

128

4 mining
4 powerplants

106

114

7 electricity distrib.
Transport

2 ports
11

2 highways
3 railways
4 airports

Sanitation

3 water and
sewage
3
2015A

2016E

2017E

Ten points of the Crescer program, released by the executive office of the president of Brazil:
Only feasible projects

100 days between RFPs and auctions

Investment requirements to follow demand triggers

Environmental licensing

Clear regulatory framework

No more bridge loans

Independent regulatory agencies.

Assessing alternatives to address issues of current


concessionaires

TCU to pre-approve projects


RFPs translated to English

Lotex was not presented in the list


Source: Valor Economico

Corporate Presentation and 3Q16 Results

Infrastructure: Length of time to impact Mills revenue


Even for projects executed effectively, it takes a long time between the publication of the bidding documents and the
effective beginning of the construction work.

Concession
announcement

Bidding
documents
publication

Auction

Contract
signature

December/2012

October/2013

November/2013

April/2014

June/2014

9 months

May/2011

December/2011

February/2012

May/2012

August/2012

8 months

February/2008

May/2011

August/2011

November/2011

August/2012

1 year and 3 months

Beginning of
Length of time to
work
impact Mills revenue

The next investments should take longer between notice and works, as the government announced that
increased the auction deadlines from 45 to 120-180 days.

Source: Concession contracts; Globo (5/27/2014); GRU Airport (5/2014); Estado (6/30/2016)

Corporate Presentation and 3Q16 Results

Real Estate: Length of time to impact Mills revenue


The equipment rental evolves in average 24 months after the construction launch.
Impact on Mills revenue

Typical deadlines of real estate projects

Land purchase

Planning

12 months

24 months

Real Estate
market

2H 2018:
Rock bottom

Start/Launch

12 months

Mills
Market

Work beginning

2012

Landscaping: Yellow line


Foundation: pile driver, drilling rigs
Access: Scaffoldings,

12 months

Plataforms

Construction

12 months

2016

2018

2020

Rental market has a cyclical delay ~24 months in relation to the


real estate market.
Experts believe that the real estate market in 2016 will go
through the period of its maximum depression, should resume at
the end of 2017 (residential).
Thus, it is not expected the resumption of the Real Estate
market (equipment rental) before 2018.

Time

Source: ABRAINC; CBIC

Corporate Presentation and 3Q16 Results

Corporate Presentation and 3Q16 Results

1. Market Overview

2. Company Overview

3. Business Units

4. Financial Profile

10

Corporate Presentation and 3Q16 Results

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 invest in the expertise of our team of professionals, which, allied to our
diversified experience, allows us to deliver prompt, clever and reliable solutions that
increase our clients results and productivity in construction works.
National Coverage:19 States and Federal District in 32 locations

Highlights & Shareholder Structure


Approximately 1,600
employees

Capillary coverage to the whole


country

Portfolio with more than 90


solutions

2 business units:
Construction and Rental

Board of
Directors and
Executive
Officers 0.4%

Shares in
Treasury 1.3%

Nacht Family
34.5%
Free Float
63.8%

(1) As of July 31, 2016

11

Corporate Presentation and 3Q16 Results

Company History
First Brazilian
manufacture of
formwork by license
agreement with NOESchaltechnik from
Germany

Founded on 1952.

50`s

Sells Events Unit


Acquired Jahu Ltda
Initiates its Rental Unit

90`s
Ferrovia do Ao

Catedral da S

hydroelectric power plant Lajeado


2000

80`s

Joint Venture with Aluma


Systems Inc. of Canada
(until 2001)

Cable-stayed bridge BRT Transcarioca


2016

2013

Sale
of
the
Industrial Services
business unit

Corporate Presentation and 3Q16 Results

Maracan Stadium
2010

In 2007. two private


equity funds. managed
by
IP,
and
Axxon,
became our shareholders.
Acquiring,
each
one,
10%.

Petrobras Oil platform

12

Paiva construction work

Capital Increase. with the


issuance of 47 million
new common shares, in
the total amount of R$
125 million

Mills IPO

Business Units
Construction

Rental

Focus on Infrastructure, Industrial, Residential and


Commercial projects.

Focus Civil Construction, Industry, Retail and Others.

Sales and rental of concreting and shoring, providing


engineering solutions, services of technical planning,
project and supervision related to equipment.

Rental and sale of motorized access equipment, such as


aerial work platforms and telescopic handlers.

3Q16:
Equipment volume: approximately 110,000 tons

3Q16:
Equipment volume: approximately 6,000 equipment

Average duration of contracts: 18 months for


infrastructure projects and 8 months for real estate
projects

Average duration of contracts: 7 months for long term


contracts and 2 months for spot contracts

Number of active contracts: 182 for infrastructure and


630 for real estate

Number of active contracts: 1,817

Source: Mills, Serasa, Companys reports

13

Corporate Presentation and 3Q16 Results

Business Units
Mills is the national market leader in equipment rental for both business Units.
Construction equipment: 2015 Net Revenues

Mills

283

Mills

144

Solaris

Ulma

94

141

Locar

Rohr

70

142

Metax

70

Pashal

85
23

Not listed

110

SH

Not listed

Arial work platforms: 2015 Net Revenues (R$ million)

(R$ million)

Trimak

293
140-160
120
80

304
97

Degraus 20
Grupo Orguel

216

70
46

Considers the competitors total revenue and the revenue related to Millss similar products are estimated. 2014 data for Metax and Pashal. Metax has a Rental business unit only in Ribeiro Preto and
was not considered in the estimated value.

Revenue from other products


Source: Mills, Serasa, Companys reports

14

Corporate Presentation and 3Q16 Results

What We Do?

15

Formwork

Special systems

Shoring

Access

Corporate Presentation and 3Q16 Results

Presence on all Construction Phases


Our work starts on preliminary economic and technical viability studies and go until the end of the projects. Thus, we
ensure the use of the best engeneering solutions.

Viability Studies

The
knowledge
and strategic
partnerships
allow us to
provide the
BEST
solution in
terms of
quality, costs,
risks,
deadlines and
interferences.

16

Executive
Projects

Our product
mix enables
the execution
of the best
solutions.

Corporate Presentation and 3Q16 Results

Implementation
(Construction
Site)

Supply of
scaffolding,
aerial work
platforms,
water tank
shoring etc.

Foundation

Supply of
scaffolding,
forms and
shoring.

Structure

Supply of
shoring
systems,
formwork,
scaffolding,
aerial work
platforms and
telehandlers.

Finishing

Supply of aerial
work platforms,
mast climbing
work platform,
liftpod and
scaffolding.

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 19 States and Federal District in 32 locations;


110,000 tons of equipment in the Construction business unit vs 60,000 tons of
equipment of the second player;
6,000 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
(3Q16);
Rental: Construction 52%, Non-construction 34% and Spot 14%
Heavy Construction: Urban Mobility 27%, Logistics 35%, Industrial 11%, Others 27%
Real Estate: 47% Residential, 34% Commercial and Others 19%

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

Corporate Governance

Listed on BM&FBOVESPA at the highest corporate level (Novo Mercado) since 2010;
Audited by Big Four Companies and currently by KPMG;
Professional Management

17

Corporate Presentation and 3Q16 Results

Lean Organizational Structure to Face Market Challenges


Srgio Kariya
CEO

Ricardo Gusmo
Commercial Officer
for Construction

Marcelo Yamane
Rental Executive

Avelino Garzoni
Engineering and
Operations Officer

Gustavo Zeno
CFO and IRO

Fernanda Pinheiro
Human Resources
Executive

Construction
Headcount as of December 31

2,054

2,008
208

1,795

1,706

27
1,558
371

1,347

Shared Services
Engineering

2015

Rental
Construction
952

2010

2011

2012

2013

2014

2015
2015

18

Corporate Presentation and 3Q16 Results

(1) Excludes Industrial


Services, sold in 2013

Corporate Presentation and 3Q16 Results

1. Market Overview

2. Company Overview

3. Business Units

4. Financial Profile

19

Corporate Presentation and 3Q16 Results

Construction: Strong Background


Projects
Viaduct Rodovia Dutra (So Paulo)

Cable-stayed bridge BRT Transcarioca (Rio de Janeiro)

20

Corporate Presentation and 3Q16 Results

Subway Line 4 (So Paulo)

Construction: Strong Background


Balanced Cantilevers and Trusses

21

Corporate Presentation and 3Q16 Results

Concrete Formworks

Shoring Systems

Construction: Main Works with Mills Participation

North and Northeast


North

VLT Fortaleza - CE
Canal Alagoano - AL
Rail Extension PA
Shopping Olinda - PE

Central-west and South

Trevo Triagem Norte DF


Papuda Penitenciary DF
Guaba Bridge RS
Powerplant So Manoel - MT

South

Southeast
Confins Airport Expansion
MG
Consortium So Loureno
SP
Duplication BR-381 MG
Subway Line 5 SP
Duplication BR-101 RJ
Contagem Viaduct - MG

Monorail Line Gold SP


Nova Tamoios Highway
SP
Rodoanel SP
ETE Montes Carlos MG
Imigrantes Viaduct - SP

States with Mills presence

22

Corporate Presentation and 3Q16 Results

Rental: Main Products


Equipment rental in Brazil has significant potential for penetration increase, beyond the recovery cycle.

Aerial Work Platforms

23

Corporate Presentation and 3Q16 Results

Telescopic Handlers

Atualizar tudo

Rental

In addition to the recovery in the cycle, leasing platforms in Brazil has significant potential to increase penetration

Platform fleet / Industrial GDP

Platform fleet / habitant

In USD Billion

In 100.000 habitants

3x more aerial work platforms per US$ Industrial GDP in the USA

15

Best potential
comparison

~12x more aerial work platforms per habitant

165

5
14

EUA

Brazil

Indicator shows growth potential of the Brazilian


fleet in relation to the fleet in the US.
The lack of local production in Brazil, the
cyclicality of economies, culture/knowledge of
end-user reduces comparison.

24

Corporate Presentation and 3Q16 Results

EUA

Brazil

The indicator is not suitable to signal potential.


Per capita number of platforms indicator does
not consider economic productivity (output-input,
workforce).

Rental: Market Perspective


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

6,000

equipment and the second player approximately


2,900.
Use of aerial platforms in Brazil

Volume of Equipment Purchased in Brazil

In Brazil, platforms are mainly used in construction works and buildings - and industrial maintenance.
However, they can be used for any work that needs to be
done in time.

8616

5866
4983

4567

Construction: platforms are used during construction for


electrical, hydraulic and infrastructure projects.

3218

2950
1540
80 100 150 260

630

720

425

93

Industrial Maintenance: Maintenance and services in


production environments. For example in automotive
industries.
Logistics: Transportation of goods and inventories.
Source: Mills

25

Corporate Presentation and 3Q16 Results

Corporate Presentation and 3Q16 Results

1. Market Overview

2. Company Overview

3. Business Units

4. Financial Profile

26

Corporate Presentation and 3Q16 Results

Summary Financials
In R$ million

Costs and Expenses

Net Revenue
900.0

354.5

462.8

832.3
56.8
101.3

665.5

800.0
700.0

39.9
64.1

600.0
500.0
400.0

30.1
36.0

300.0
200.0

288.4

100.0

794.2

576.1

50.4
80.5

561.4

516

500

8.3
59.6

400

663.3

300

484.4

2
125

200

358.5

100

2011

2012

Equipment Rental

276

11
164

585

529

38

26

209

232

203

181

335

348

344

323

2013

2014

2015

LTM
3Q16

16
14

42

172
340

238

2013

Sales

2014

2015

LTM
3Q16
Technical assistance and others

2010

2011

168.4

217.4

600.0
47.5%

339.0

50.9%
47.0%

419.3

340.7

161.2

80.9

168.4

28.0%

2012

166.8

64.3

2010

2011

2012

2013

2014

30.0%

395.1
320.9

217.4

2011

151.5

40.0%
19.8

2013

2014

Result/provision of sales of semi new equipment

Corporate Presentation and 3Q16 Results

20.0%

12.7
148.5

13.0
67.9

2015

LTM 3T16

0.0
2010

92.2

50.0%

18.0%
323.2

103.3

50.4%

15.8

200.0

ADD

60.0%

24.2

300.0

SG&A

Net Profit (Loss)

42.9%

400.0

2012

COGS

Ebitda and Ebitda Margin

27

622

2010

100.0

560

600

0.0

500.0

424

700

27.6
36.8

398.4

402

800

37.8
53.9
674.2

900

449.5

Ebitda

2015

LTM 3Q16

-97.8

-118.9

10.0%
0.0%

Ebitda Margin

(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 Rohr impairment of R$26.2 million in 2015

Rental Revenue Breakdown for 3Q16


In R$ million

Construction Business Unit


Heavy Construction:
Per Source of Resources
R$ 27.0 million

Heavy Construction:
Per sector R$ 27.0 million

Real Estate:
Per Type R$ 15.7 million

Sanitation
11.2%
Others
17.4%

PPP
15.6%
Private
38.2%

Industrial
10.6%

Subway/Train/BRT
27.4%
Residential
48.5%

Others
15.4%

Commercial
34.2%

Highways
18.3%

Public
46.3%

Railways
5.9%

Airports
11.1%

Rental Business Unit


Net Revenue per Type of Service
R$ 43.4 million
Sales of semi
new
equipment
1.9%

Technical
Assistance Indemnities
3.0%
0.9%

Sales of new
equipment
2.8%

Per Use
R$ 39.6 million
Spot
14.1%

Nonconstruction
34.3%

Construction
51.6%

Rental 91.2%
Public: resources from the government
Private: resources from the private sector.
PPP (publicprivate partnership) : resources from the government and the private sector

28

Corporate Presentation and 3Q16 Results

Utilization Rate and Net Revenue


In R$ million

Volume Utilization Rate

Net Revenue
Construction

100%
90%
80%
70%

37.8

2.6

60%

0.9

34.3

Price and Mix

3Q16

50%
40%

Average LTM 3Q16 = 43.7%

30%

20%
10%
0%
1Q10 3Q10 1Q11 3Q11 1Q12 3Q12 1Q13 3Q13 1Q14 3Q14 1Q15 3Q15 1Q16 3Q16
100%

2Q16

Rented Volume

Rental

90%
80%
70%

47.2

2.9

4.7
39.6

60%
50%
40%

Average LTM 3Q16 = 58.1%

30%
20%
10%
2Q16

Rented Volume

Price and Mix

3Q16

0%
1Q10 3Q10 1Q11 3Q11 1Q12 3Q12 1Q13 3Q13 1Q14 3Q14 1Q15 3Q15 1Q16 3Q16
(*) 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.

29

Corporate Presentation and 3Q16 Results

ADD Percentage Equal to 3.2% of Net Revenue in 3Q16


Allowance for Doubtful Debts (ADD) Evolution
In % of net revenue
12.8%

7.0%

6.0%

5.9% 5.8%

5.30%

3.2%
2.10% 2.0%
1.70%

1.2%

0.30%
2010

2011

2012

2013

2014

1Q15

2Q15

3Q15

4Q15

1Q16

2Q16

3Q16

Delinquency Evolution

65.0%

68.2%

72.9%

72.0%

60.1%

62.3%

1Q16

2Q16

75.2%

60.7%
70.0%

48.6%

2Q15

51.8%

3Q15

56.9%

4Q15

ADD Balance/Total Trade Receivables


Total Past Due/Total Trade Receivables

30

Corporate Presentation and 3Q16 Results

3Q16

2010-2014 Average:
2.3%

Free Cash Flow


In R$ million

Even on an adverse scenario, the Company remains generating free cash flow
Cash Flow
383.7

372.7

295.5

288.3 281.9

198.9

158.9

116.1
80.8

2010

2011

2012

2013

2014

2015

79.5

1Q16

50.1 48.6

46.4 67.1

2Q16

3Q16

-31.2
-154.3
-208.9
Adjusted Operating Cash Flow

-356.5

Free Cash Flow to the Firm

EBITDA Reconciliation with Operational Cash Flow


11.2

0.2

4.9

0.8

2.6

1.2

46.2

20.1

Non-Cash

Operating Cash
Flow

Interest paid

Operating Cash
Flow before interest
paid

Other liabilities

Payroll and related


taxes

Trade payables

Other assets

Purchases of rental
equipment

26.1

Trade receivables

Interest and
monetary and
exchange gains

Accrued expenses
on stock options

5.7

Other non cash


items

Provision for tax,


civil and labor risks

0.7

1.1

Allowance for
doubtful debts

0.9

Gain on sale of
property, plant and
equipment

1.7

Profit sharing
payable

11.2

Ebitda CVM

11.3
2.8

Cash

Before interests paid referring to debentures, FINAME and investment in equipment rental.
Before interests paid referring to debentures and FINAME.
Includes R$6.2 million of revenue from sales of new and semi new equipment in 3Q16, R$ 8.5 million in 2Q16 and R$ 31.4 million in 1Q16. In 2015 the revenue of sales was R$ 53.9 million.

31

Corporate Presentation and 3Q16 Results

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 of the period.

Average Invested Capital

ROIC Breakdown

1,800.0

Net Revenue
449.5

5.0%

1,617.7
1,600.0

144.5

1,562.5

COGS
(179.7)

1,505.8
1,439.5

2.0% 139.6

1,374.0

134.5

1,400.0

125.3

0.8%

116.2

0.0%

1,302.7
104.8

NOPAT
(93.4)
(53.4)

1,200.0

696.9

675.8

-2.9%
654.7

1,000.0

-3.8%
632.5

-5.0%

-5.8%
606.9

-7.2%
580.3

SG&A
(246.0)
(188.9)
Depreciation:
(160.6)

800.0

-10.0%

ROIC LTM
-7.2%
Adjusted -4.2%

600.0

400.0

776.3

747.2

716.6

681.7

Income Tax (rate of 30%) 41.0


23.9
Rohr Dividends: 1.5

-15.0%

650.9

617.6
Net Rental PP&E
878.8

200.0

-20.0%

2Q15

3Q15
Construction

4Q15
Rental

1Q16

2Q16
Others

3Q16
ROIC

Invested Capital
1,302.7

Others
423.9

ROIC = NOPAT/Average Invested Capital. Invested Capital = 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.
Includes Rohr, Events and Industrial Services business units. Excluding impairment (R$57.1 million) from NOPAT

32

Corporate Presentation and 3Q16 Results

Summary Financials
In R$ million

2010

2011

Consolidated
Construction
Rental

354.5
259.4
95.1

462.8
287.4
175.4

Consolidated
Construction
Rental
Others

168.4
117.4
51.0

217.4
123.8
93.6

Consolidated
Construction
Rental

47.5%
45.3%
53.6%

47.0%
43.1%
53.4%

Consolidated
Construction
Rental

308.9
178.3
130.6

395.1
232.3
162.8

Construction
Rental

76.5%
77.9%

73.6%
77.8%

EBITDA*/Net financial results >= 2.0


Net Debt/EBITDA* <= 3.0

7.5
1.6

2012

2013
2014
2015 LTM 3Q16
Net Revenues
665.5
832.3
794.2
576.1
449.5
412.0
474.9
423.4
283.0
205.0
253.5
357.3
370.8
293.2
244.5
Ebitda
339.0
419.3
340.7
161.2
80.9
197.8
212.3
153.5
32.2
2.1
141.2
207.0
196.7
132.6
84.6
-9.5
-3.7
-5.9
Ebitda Margin
50.9% 50.4% 42.9% 28.0%
18.0%
48.0% 44.7% 36.3% 11.4%
1.0%
55.7% 57.9% 53.0% 45.2%
34.6%
Rental Equipment CAPEX
271.2
463.6
166.5
11.6
2.4
110.3
196.4
62.4
11.6
2.3
160.9
267.2
104.2
0.0
0.1
Utilization rate (volume)
75.4% 72.3% 63.0% 49.9%
43.7%
72.5% 73.0% 63.2% 61.9%
60.7%
Covenants
9.1
9.0
5.4
3.0
2.5
1.2
1.4
1.5
2.1
1.4

% Part
100.0%
45.6%
54.4%
100.0%
2.6%
104.6%
-7.2%
100.0%
97.0%
3.0%
-

(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 Rohr impairment of R$26.2 million in 2015

33

Corporate Presentation and 3Q16 Results

Indebtedness
In R$ million

The weighted average maturity of our debt is 2.8 years at a cost of CDI+0.17%.
Gross Debt Profile

Principal Amortization Schedule


322.6

35.9%
150.3
106.2

106.2

64.1%

38.9
0.8
Caixa
Short Term

2016

2017

2018

2019

2020+

Finame
3rd Emission of Debentures - 108,8% CDI
2nd Emission of Debentures - IPCA +5,5%
2nd Emission of Debentures - CDI + 0,88%

Long Term

We do not have foreign currency exposure.

Indebtedness on 06/30/2016
-2.8%
50.6

-32.8%

452.8

322.6

402.2

-64.4%

130.3
TJLP

CDI

IPCA

Principal

34

Corporate Presentation and 3Q16 Results

Interests

Gross Debt

Cash

Net Debt

Key Takeaways
Infrastructure investment needs to be substantially increased to meet social needs and support economic growth;
Largest footprint: present in 19 States and Federal District in 32 locations;
Largest fleet in Brazil in all business units;
AWP: Immature market with low penetration and the safest way to work on height;
Efforts to increase presence in the international market;

Sales of assets aiming at to real estate market (lower turnover);


Strengthen relationships with mid-sized construction companies
Focus on non-construction markets for the Rental unit
Continuous search for operational efficiency

Reliability

Management committed to Corporate Governance

Agility and
Matchless
Executions

National
Coverage

Best in Class
Solutions

Tailor Made
Projects

Complete Product
Portfolio
35

Corporate Presentation and 3Q16 Results

Disclaimer
This presentation may contain statements that present expectations of the Management of Mills Estruturas e Servios 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 statements, 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 Comisso de Valores Mobilirios CVM.

Mills Investor Relations


Phone: +55 (21) 3924-8768
E-mail: ri@mills.com.br

www.mills.com.br/ri

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