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Corporate Presentation | July, 2008
THE GROWTH HISTORY THE GROWTH HISTORY GOES ONGOES ON
THE GROWTH HISTORY THE GROWTH HISTORY GOES ONGOES ONGOES ON...GOES ON...GOES ON...GOES ON...
Disclaimer
This presentation relating to MMX Mineração e Metálicos S.A. (“MMX”) includes “forward-looking statements”, as that term is defined in the PrivateSecurities Litigation Reform Act of 1995, in Section 27A of the Securities Act of 1933 and Section 21E of the U.S. Securities Exchange Act of 1934.All statements other than statements of historical facts are statements that could be deemed forward-looking statements and are often characterizedby the use of words such as “projects”, “expects”, “anticipates”, “intends”, “plans”, “believes”, “estimates”, “may”, “will”, or “intends”, or by discussionsor comments about our objectives, strategy, plans or intentions and results of operations. Forward-looking statements include projections regardingour operating capacity, operating expenditures, capital expenditures and start-up dates.By their nature, these forward-looking statements involve numerous assumptions, uncertainties and opportunities, both general and specific. Thei k i t th t th t t t t b f lfill d if th f lfill d th lt d l t d ib d i h t t t trisk exists that these statements may not be fulfilled or, even if they are fulfilled, the results or developments described in such statements may not
be indicative of results or developments in future periods. We caution participants of this presentation not to place undue reliance on these forward-looking statements as a number of factors could cause future results to differ materially from these statements.Forward-looking statements may be influenced in particular by factors such as the ability to obtain all required regulatory approvals on a timely basisor at all, exploration for mineral resources and reserves, difficulty in converting geological resources into mineral reserves, and changes in economic,
liti l d l t diti W ti th t th f i li t i t h ti Wh l i f d l ki t t t t kpolitical and regulatory conditions. We caution that the foregoing list is not exhaustive. When relying on forward-looking statements to makedecisions, investors should carefully consider these factors as well as other uncertainties and events.MMX does not undertake to update our forward-looking statements unless required by law. This presentation is neither an offer to sell (which canonly be made pursuant to definitive offering documents) nor a solicitation of an offer to buy any securities in the United States, or any otherjurisdiction. The securities referred to herein have not been registered in any jurisdiction, and in particular, will not be registered under the U.S.Securities Act of 1933 as amended or any applicable state securities laws and may not be offered or sold in the United States absent registration orSecurities Act of 1933, as amended, or any applicable state securities laws and may not be offered or sold in the United States absent registration oran applicable exemption from such registration requirements.This presentation and its contents are proprietary information and may not be reproduced or otherwise disseminated in whole or in part withoutMMX’s prior written consent.
Investor RelationsNelson Guitti – Officer
Marilia Botelho – ManagerGina Pinto AnalystGina Pinto - Analyst
Tel. 55 21 2555-5634 / 5558/ [email protected]
Corporate Structure
Free Float 32.7%
Controlling Shareholders 67.3%
100%100%70% 100%
MMX SudesteMinera MMX
de ChileCorumbá System
MMX Corumbá Mineração
MMX Corumbá Mineração
MMX Metálicos Corumbá
MMX Metálicos Corumbá
MMX SudesteMMX Sudeste
30% Centennial Asset Corumbá
100%100% 100%
Sudeste SystemBom Sucesso
AVGAVG MinerminasMinerminasBom SucessoBom Sucesso
Greenfield projects developed by MMX: Corumbá System started-up in 2005 (Mining) and 2007 (Metallics); Bom Sucesso start-up scheduled for 2012.
Assets acquired by MMX (AVG: dec-07; Minerminas: jan-08)
Assets
MMX S.A. is the exclusive vehicle of EBX Group for investments in mining and metals, focusing on the production capacity increase through organic growth and the development of new opportunities.
Iron Ore: 6.3 MtpyPig Iron: 0.4 MtpyBillets: 0 4 Mtpy
MMX Corumbá System
MMX S d tBillets: 0.4 Mtpy
Forestry Program:32,000 hectares of
eucalyptus forest.Self-sufficiency in
MMX Sudeste
I O 33 7 Mt
MMX Sudeste
Self sufficiency in charcoal by 2017.
Pelletizing Plant 50%-Option (at Açu Port)
Iron Ore: 33.7 Mtpy
Royalties on MMX Minas-Rio production
Royalties on MMX Amapá production
Minera MMX de Chile
New Business Development productionNew Business Development
Management
Eike BatistaCEO & Chairman of
Eike BatistaCEO & Chairman of
Joaquim MartinoJoaquim Martino
CEO & Chairman of Board of Directors
CEO & Chairman of Board of Directors
11
Executive OfficerExecutive Officer
Vitor FeitosaCOO
Vitor FeitosaCOO
22Chequer Bou-
HabibChequer Bou-
Habib
33Nelson Guitti
CFO and Investor
Nelson GuittiCFO and Investor
44
Commercial DirectorCommercial Director RelationsRelations
Joaquim Martino Former Director of Pelletizing and Metallics, former Director of Carajás Mine and Ponta da Madeira Port (VALE), former Superintendent of Casa de Pedra Mine (CSN) and former Mining Director of MMX 27 years of experience
11
Vitor Feitosa Former Geology Coordinator, former Chief of Mine Planning and former General Manager of Sustainable Development of SAMARCO – 24 years of experience
Superintendent of Casa de Pedra Mine (CSN) and former Mining Director of MMX – 27 years of experience
Chequer Bou-Habib Former Marketing and Administration Director of VALE office in Brussels, former President of SAMITRI, former President of
22
33FERTECO, former CEO of GIIC (VALE subsidiary), former General Director of AVG Mineração (MMX) – 24 years of experience
Nelson Guitti Former Financial Director of BR DISTRIBUIDORA and former Executive Director of Strategy and Planning of GASPETRO –20 years of experience
44
High Performance in Strategic Management
Partnership with strategic players
Anglo & Cleveland Cliffs
Long Term Off-T k A t
70% Capex contractedMMX Minas-Rio
Pro-activity (voluntary public hearings)
Environmental LicensingEliezer Batista Natural Reserve
Commitment with the Environment
Traditional Steel Companies
Take Agreement
2 years July 2006
July2008
Implementation inMMX Amapá
Financial MarketOTPP
LLX L í ti S/AImplementation in record time (14 months)
Financial Market trust Focus on
infrastructure projects
LLX Logística S/A
Mine implemented in 8 months; Pig iron plant implemented in 12
MMX Corumbá
implemented in 12 months
Effectiveness in projects implementation
Implementation of Amapá System 14 Months
December, 2004 D b 2007December, 2004“Explorers”
December, 20071st shipment
December, 2007Start-up
September, 2006Environmental Licensing and
beginning of construction
Results reflected on the outstanding performance of MMX shares
MMXM3 X IBOVESPA (US$)
MMXM3 557 9%
5 0 0
6 0 0
7 0 0
8 0 0 IBOVESPA 142.7%MMXM3 557.9%
MMXM3 US$ 31 1
1 0 0
2 0 0
3 0 0
4 0 0
5 0 0 MMXM3
IBOVESPA
US$ 31.1
0
1 0 0
24/7
/06
24/9
/06
24/1
1/06
24/1
/07
24/3
/07
24/5
/07
24/7
/07
24/9
/07
24/1
1/07
24/1
/08
24/3
/08
24/5
/08
(US$MM)
M M X M 3 IB O V
( $ )
23 23
16 1621
29 29 30 812
45020 025.030.035.0
600
800
1000
264
110.20.2
6513
9
16111310
3
16
4549
12 22 20 21 44 2741 65 775919 84 95 129 136
104
450
0 05.0
10.015.020.0
0
200
400
600
*daily average
0.0
Jul/0
6
Aug
/06
Sep
t/06
Oct
/06
Nov
/06
Dec
/06
Jan/
07
Feb/
07
Mar
/07
Apr
/07
May
/07
Jun/
07
Jul/0
7
Aug
/07
Sep
t/07
Oct
/07
Nov
/07
Dec
/07
Jan/
08
Feb/
08
Mar
/08
Apr
/08
May
/08
Jun/
08
0
Volume Traded * Number of Trades*
MMX´s Performance Pillars
Iron Ore Market growthIron Ore Market growthIron Ore Market growthIron Ore Market growth
Management delivering as promisedManagement delivering as promised
Added valueAdded valueAdded valueAdded value
Sustainable Operation: a MMX Value
Health & Safety • Recordable Incidents Frequency Rate
100
80
• Occupational Diseases Frequency Rate• Compliance with hygiene standards
• Compliance with environmental standards• Water consumption• Water recirculation
Water
60
40
• Water recirculation• Compliance with water grants
Relationship with communities
Water resources 20
0
• ETHOS Social Responsibilityp yIndicators
• Energy efficiencyU f bl
• Domestic waste generation EnergyWaste • Use of renewables
• Charcoal from planted forestsgeneration• Reuse of industrial waste
Environment: social and environmental awareness and accountability
Strong and close integration with local communities and partnership with technical entitiesin social and environmental questions
Guided visits in the Forest site for local students;
Trainee programs;
Forest handling and fire prevention textbooks;
Trainee programs;
Implementation of communitarian plant nursery and
Tree planting program in communities adjacent to the
p p yenvironmental education; Stewardship Management
Plan - Pantanal
Forestry Program site;
Local charcoal production and forest diagnosis;Environment
Permanent local fauna and flora studies;
Seed n rser of nati e plants for restoring
Environment Week
Seed nursery of native plants for restoring altered areas.
Ceramic workshop
Environment: commitment with Nature
Eng. Eliezer Batista Private Natural Heritage Reserve – 20 thousand protected hectares
MMX, committed with sustained development principles, has acquired and maintains the Eng Eliezerand maintains the Eng. Eliezer Batista Private Natural Heritage Reserve, in the heart of Pantanal (largest wetland in the world), an(largest wetland in the world), an impressive and relevant area in terms of bio-diversity and natural richness.
This Heritage Reserve will be the first research and studies center of wetlands in the planet, where there are hundreds of mammals, including jaguars, 300 species of fishes and more than 700 species of birds, some of them considered endangered species. The Reserve has its Stewardship Management Plan ready since the beginning, reflecting MMX´s commitment with preservation.
Technological innovation: a value creation tool
Research Lab
Projects based on qualified and
robust technical research, using
recognized ultimate technologies
contributing to CAPEX and OPEX
reduction.
Vertical Mill
Ceramic Filter
Roller Press
The Growth History Goes on…The Growth History Goes on…
The Growth History Goes on: 40 Mtpy
Mining Production – Mpty
38 4 40.0 40.0 40.0
3 2
6.3 6.3 6.3 6.3
21.6
38.4MMX CorumbáMMX Sudeste
Total CAPEX 4.38.7 8.7
18.5
32.1 33.7 33.7 33.7
1.92.1 3.2
3.2
6.210.8 11.9
US$ 1,509 million
Metallics Production– thousand tons/years
2008 2009 2010 2011 2012 2013 2014 2015
400 400 400 400 400 400 400357
452 452 452 452
231 Pig IronBillets
- -34
2008 2009 2010 2011 2012 2013 2014 2015
Business Development
Exploration Exploration Exploration Exploration
599 areas (mineral grants)
approximately 16,000 km2
8 States in Bra il and Chile
599 areas (mineral grants)
approximately 16,000 km2
8 States in Bra il and Chile8 States in Brazil and Chile.
iron ore, manganese, copper, bauxite, and others
8 States in Brazil and Chile.
iron ore, manganese, copper, bauxite, and others
AcquisitionsAcquisitionsAcquisitionsAcquisitions
MMX is continuosly evaluating business opportunities, searching for increase in production scale and value creation, in Brazil and abroad (Minera MMX de Chile).MMX is continuosly evaluating business opportunities, searching for increase in production scale and value creation, in Brazil and abroad (Minera MMX de Chile).
C bá S tCorumbá System
Mining
MMX Corumbá Mineração: Production Ramp-Up & Capex
6.3 6.3 6.3 6.3Production - Mtpy Expected Quality (%)Corumbá
(coarse fines)
1.0 1.0 1.0 1.0
1.5 1.5 1.5 1.5
3 2 3 2
Sinter Feed Hematitinha Lump
Lump Hematitinha Sinter FeedFe 64.4 64.6 64.7SiO2 4.6 4.4 3.7Al2O3 1.5 1.3 1.4P 0.058 0.065 0.070
2 1 2 1
3.8 3.8 3.8 3.80.2
0.3 0.30.5
0.8 0.8
1.92.1
3.2 3.2PPC 1.1 1.3 1.7
1.91.4
2.1 2.1
2008 2009 2010 2011 2012 2013 2014 2015
CAPEX US$ 62 million
122
18.519.8
12.2 11.5
2008 2009 2010 2011
MMX Corumbá: Logistics
Current route
Transport in barges down the Paraguay River delivering products to South American costumers and shipments to Europe and USA at Rosario Port:
Long Term Agreements with international barge operators.
Future alternative route
Use of railway until Port Brasil (LLX) in Sao Paulo State:
project under development by LLX – start-up 2012.
Corumbá System
Metallics
Pig Iron & Billet Market
Pig Iron and Billet prices have reached their peak in 2008 and the current market scenario - high demand for steel products, high raw materials and energy prices and low steel scrap offer – appoints for continuous
potential upsides in the pig iron and billet prices.
Pig Iron and Billets Prices1300
9001000110012001300
500600700800900
US$
/tonn
e
100200300400500U
0100
Nov
-03
Jan-
04
Mar
-04
May
-04
Jul-0
4
Sep
-04
Nov
-04
Jan-
05
Mar
-05
May
-05
Jul-0
5
Sep
-05
Nov
-05
Jan-
06
Mar
-06
May
-06
Jul-0
6
Sep
-06
Nov
-06
Jan-
07
Mar
-07
May
-07
Jul-0
7
Sep
-07
Nov
-07
Jan-
08
Mar
-08
May
-08
Jul-0
8
Pig Iron FOB Vitória / Rio Billets FOB South AmericaSource: Metal Bulletin - Monthly Averages
MMX Metálicos Corumbá: Production Ramp-Up & Capex
452 452 452 452
Production Ramp-Up (thousand ton/year)
231
400 400 400 400 400 400 400357
Pig Iron
- -34
Billets
Pig iron production feeds Billet production.
120
2008 2009 2010 2011 2012 2013 2014 2015
Total CAPEX (2008-2015)
US$ 333 million
101
2921 17 15 15 1517 15 15 15
2008 2009 2010 2011 2012 2013 2014 2015
MMX Corumbá: Timeline
2008 2009 2010 2011 2012 2013
Min
a 63
Beginning of construction
ConstructionConstruction License
DevelopmentBasic Engineering
Operationconstruction
Start Up 2nd phase
Operation License
Rab
icho Development
Basic Engineering
ConstructionConstruction License
OperationStart Up
OperationOperation license
NE
& R g g
Preliminary License
Beginning of construction
Development ConstructionB i i f
OperationO ti li
Bill
ets Basic and detailed
engineeringBeginning of construction
Operation license
Start Up
MMX Corumbá: Forestry Program – responsible stewardship and biomass self-sufficiency
After starting up a forest program in 2006, MMX will ramp up charcoal production to reach self-sufficiency by 2017.
Program:
Target: 34,000 hectares of eucalyptus planting;
Use of innovative technologies ferti irrigations;Use of innovative technologies – ferti-irrigations;
Partnership with universities and experts;
Partnership with locals for planting - technology and seeds provided by MMX;
Totally mechanized planting process;
Emissions and effluents control;
Environmental education for local communitiesEnvironmental education for local communities.
MMX Corumbá: Biomass self-sufficiency under way
After starting up a forest program in 2006, MMX will ramp up charcoal production to reach self-sufficiency by 2017.
100%
57%57%57%
26%
5%5%5%5%0% 5%5%5%5%0%
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Sudeste SystemSudeste System
Serra Azul & Bom Sucesso
MMX Sudeste: Production Ramp-Up & Capex
Production - Mtpy
32.133.7 33.7 33.7
Bom SucessoExpected Quality (%)
Serra Azul
21.4 23.0 23.0 23.018.5
Pellet Feed Sinter Feed Lump
Bom SucessoSinter Feed Pellet Feed Pellet Feed
Fe 66.2 66.4 67.2SiO2 3.1 2.9 2.5Al2O3 0.9 0.5 0.5
6 5 6 5
12.39.5 9.5 9.5 9.5
0 1
1.1 1.1
4.8
4.3
8.7 8.7
P 0.045 0.046 0.0339PPC 1.0 1.1 0.6FeO* 8.8* aprox 30% magnetite
0.9 1.1 1.1 1.4 1.2 1.2 1.2 1.23.2
6.5 6.50.1
2008 2009 2010 2011 2012 2013 2014 2015
CAPEX US$ 1,1 billion
290 7
535.7
34.9
290.7241.3
10 910.9
2008 2009 2010 2011 2012
MMX Sudeste: Logistics
Serra Azul Business Site:
Conveyor belt linking mine site to railroad
Serra Azul
terminal (8km)
Bom Sucesso Business Site:
pipeline linking mine site to MRS (40km)
Railroad:
Long Term Agreement with MRS to grant transport availability
Serra
transport availability
Port:
LLX Port Sudest: as of July, 2011
Bom Sucesso
Azul
MMX Sudeste: Timeline
2008 2009 2010 2011 2012 2013
l
OperationOperation License (Hard Itabirite Plant)
DevelopmentBasic engineering
Procurement
DevelopmentDetailed engineering
Beginning of construction (Hard Itabirite Plant)
Construction OperationStart Up (Hard Itabirite Plant)
Serr
a A
zu
Start Up (Soft Itabirite Plant)Construction
Construction
Preliminary license
Procurement
Operation License (Soft Itabirite Plant)
licenseBeginning of construction (Soft Itabirite Plant)
cess
o Development
Detailed engineering
Beginning of construction
Construction OperationOperation licenseConceptual and
basic
DevelopmentStart Up
Operation
Bom
Suc engineering
Construction license
constructionbasic engineering
Preliminary license
ce se
Cash Uses & Sources – US$ MM
598
782
429657
598
336
CAPEX US$ 1.509 bi
Acquisitions US$ 417 MM Uses
Total US$ 1 926 bi169 12577
274138
28 15 15 15 Total US$ 1.926 bi2008-2015
62125
6228 15 15 15
2008 2009 2010 2011 2012 2013 2014 2015
782
C h f O ti US$ 975 MM
Sources318598
Cash from Operations US$ 975 MMDebt US$ 951 MM
464
302
152
138
336
295183
8 - - -138
138
28 15 15 15
2008 2009 2010 2011 2012 2013 2014 2015
