Embed Size (px)
Citation preview
January 2010
Credit Suisse Equity Ideas Brazil Conference
2
Information and Projection
This notice may contain estimates for future events. These estimates merely reflect the expectations of the Company’s management, and involve risks and uncertainties. The Company is not responsible for investment operations or decisions taken based on information contained in this communication. These estimates are subject to changes without prior notice.
This material has been prepared by TAM S.A. (“TAM“ or the “Company”) includes certain forward-looking statements that are based principally on TAM’s current expectations and on projections of future events and financial trends that currently affect or might affect TAM’s business, and are not guarantees of future performance. They are based on management’s expectations that involve a number of business risks and uncertainties, any of each could cause actual financial condition and results of operations to differ materially from those set out in TAM’s forward-looking statements. TAM undertakes no obligation to publicly update or revise any forward looking statements.
This material is published solely for informational purposes and is not to be construed as a solicitation or an offer to buy or sell any securities or related financial instruments. Likewise it does not give and should not be treated as giving investment advice. It has no regard to the specific investment objectives, financial situation or particular needs of any recipient. No representation or warranty, either express or implied, is provided in relation to the accuracy, completeness or reliability of the information contained herein. It should not be regarded by recipients as a substitute for the exercise of their own judgment.
3
The domestic market grew 18% in 2009
PreviousPeriod
Market
TAM
J FMAM J J ASOND J FMAMJ J ASOND J FMAMJ J A SOND J FMAM J J A SOND859095
100105110115120125130135140145
Domestic Market - Variation(vs previous period)
20072006 200812% market growth 12% market growth 7% market growth
2009
Source: ANAC
18% market growth
30% TAM’s growth 11% TAM’s growth 6.5% TAM’s growth14% TAM’s growth
4
Brazilian domestic market is composed mainly by business passengers
Leis
ure
Busi
nes
s
2000 2001 2002 2003 2004 2005 2006 2007 2008*
17.9
26.6 27.025.2
28.2
35.4
39.7
44.447.5
0
10
20
30
40
50
Domestic Market Passenger Mix (RPK M)
CAGR
11%
20%
* TAM Estimates
5
High concentration of passengers in few airports
Important barrier for newcomers
Limited ability for other competitors to grow
10 main airports in Brazil transport 70% of all passenger traffic
15 main airports are responsible for 80% of the passengers
TAM has in aggregate ~40% of all slots available in these airports
% Total Domestic Passengers Boarded - 2008
0% 2% 4% 6% 8% 10% 12% 14%
Florianópolis
Vitória
Manaus
Belém
Fortaleza
Rio de Janeiro4
Curitiba
Recife
Porto Alegre
Belo Horizonte
Salvador
Rio de Janeiro³
Brasília
São Paulo²
São Paulo¹
70%
10%
1-Congonhas 2-Guarulhos 3-Galeão 4-Santos Dumont Source: ANAC
6
Brazilian market
We have regular flights to all
Brazilian capitals and major
cities reaching 42
destinations
We operate approximately
730 daily flights
Commercial agreements
with Brazilian Regional
Airlines (Trip, Passaredo and
NHT) allowing us to reach a
total of 79 destinations in
Brazil
Note: Based on Jan 2010 network
7
Opportunity for low fare passengers on off-peak flights
0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 2355
60
65
70
75%
Load Factor per hour
Off Peak Peak Off Peak Peak Off Peak
8
We have a defined approach to increase our load factors on off-peak flights
11
22
We are communicating the domestic market that besides we are the preferred airline company, we are competitive in priceCampaign started in August 2009
We help our passenger to find the best pricesImplementation of Amadeus platform in November 2009
We facilitate our passenger payment throw partnership with Banco do Brasil and ItaúPayment in 48 months
We receive cash and the bank takes the credit risk and the interests
33
Because of the number of destinations, most of the people prefer TAM.
And now will prefer also because of the price.
TAM54%
Consult all our offers. Fly better. Fly TAM.
We acquired Pantanal Airlines
Established in 1993
Market share of 0.14% in 2009
245 employees
3 ATR-42 aircraft with 45 seats
Hub at Congonhas Airport
90% of business passengers
Gross revenues of
R$72 million in 2006
R$64 million in 2007
R$56 million in 2008
Weekdays Weekends Total
Oceanair 4,4% 3,3% 4,2%
Pantanal 6,8% 3,8% 6,2%
TAM 42,4% 50,3% 44,1%
GOL 46,4% 42,6% 45,6%
Congonhas Airport has 3,176 weekly slots
About PantanalAbout Pantanal
According to ANAC’s 2008 annual report,
Brazil has 156 city pairs with a daily
demand between 40 and 149 passengers
Mid density marketsMid density markets
Position at CGH AirportPosition at CGH Airport
Source: HOTRAN ANAC’s file, from December 18, 2009
10
PreviousPeriod
Market
TAM
J FMAMJ J ASOND J FMAMJ J ASOND J FMAM J J ASOND J FMAMJ J ASOND40
60
80
100
120
140
160
180
200
International Market - Variation(vs previous period)
41% TAM’s growth 71% TAM’s growth 40% TAM’s growth
30% market decrease 5% market decrease 26% market growth
Source: ANAC
14% TAM’s growth
1% market decrease
The international market (among Brazilian carriers) decreased 1% in 2009, while we grew 14%
20072006 2008 2009
11
The leading Brazilian international carrier
Long haul market
Miami 28x per week
NY 18x per week
Orlando 7x per week
Paris 21x per week
London 7x per week
Milan 7x per week
Frankfurt 7x per week
Madrid 7x per week
Latin American market
Buenos Aires 63x per week*
Cochabamba 4x per week**
Santa Cruz de Sierra 8x per week**
Santiago 14x per week*
Asuncion 14x per week*
Ciudad del Leste 7x per week*
Montevideo 14x per week
Caracas 7x per week
Lima 7x per week
La Paz 4x per week**
Note: Based on Jan 2010 network
* Consider only flights from Brazil** Flights from other countries
12
Source: ANAC annual report
* estimates
57%
43%
58%
42%
58%
42%
67%
33%
71%
29%
66%
34%
64%
36%
2003 2004 2005 2006 2007 2008 2009*
7.78.9
9.9 10.211.4
13.0 12.8
International passenger - Million
BrazilianCarriers
IntlCarriers
CAGR 2003 – 20099%
CAGR 2003 – 20099%
Higher growth anticipated for Brazilian carriers due to the unbalance in the bilateral agreements
13
We are both domestic and international market leaders
TAM’s Domestic Market Share*TAM’s Domestic Market Share*
Source: ANAC* RPK – Revenue passenger kilometer
TAM’s International Market Share* – Among Brazilian carriersTAM’s International Market Share* – Among Brazilian carriers
33,0%35,8%
48,0% 48,9% 50,3%45,6%43,5%
2003 2004 2005 2006 2007 2008 2009
12,0% 14,3%
37,5%
67,5%75,2%
86,5%
18,8%
2003 2004 2005 2006 2007 2008 2009
14
Liquidity and Debt Profile
83%
17%
2005 2006 2007 2008 3Q09
995
2.4532.607
1.914 1.983
0
500
1.000
1.500
2.000
2.500
3.000
Adequate debt profile (pro-forma)Adequate debt profile (pro-forma)
R$ Million
Debt mix by currency
Strategic liquidity positionStrategic liquidity position
R$ Million
2005 2006 2007 2008 3T09
3.9
2.2
5.76.2 6.3
0
2
4
6
8
Net Debt Adjusted / EBITDARNet Debt Adjusted / EBITDAR
3.9 x
2.2 x
5.7 x 6.2 x 6.1 x
Obs.: Cash Considers R$ 510MM in Bonds issued in October of 2009Obs.2: Net Debt Adjusted includes annual operating leases x 7
BONDS
R$
US$
Cash
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
0
200
400
600
800
1.000
1.200
1.400
1.600
1.800
2.000
Debentures, bonds and othersLeasings on the balance sheet
15
With our hedge renegotiation, we avoided a USD 117 million cash outflow
1 – Volume in thousands of barrels2 – Average Strike (USD/barrel)3 – Projected consumption coverage
1Q09 2Q09 3Q09 4Q09 Total 2009
1Q10 2Q10 3Q10 4Q10 Total 2010
1Q11
Renegotiated PositionRenegotiated Position
Volume¹
1,927 1,245 1,145 830
5,146 890 955 865 720
3,429 145
Strike²
107113110109109114115114113114107
Coverage³
52%33%30%22%34%23%25%22%19%22%4%
Original PositionOriginal Position
Volume¹
2,730 1,980 1,580
Strike²
105 112 111
Coverage³
73%53%41%
830 110 22%7.120 370 210 170 50
800 -
109112 115 111 108 112
-
47%10%5%4%1%5%
-
16
1Q09 2Q09 3Q09 4Q09 1Q10 2Q10 3Q10 4Q10 1Q11
125
79
48 49
32
16
54
37
21
59
41
23
51
36
20
44
31
178 5 2
(USD million)
The hedge impact on our cash will be lower on the upcoming quarters
50 USD/barrel 70 USD/barrel 90 USD/barrelRealized
Sensitivity of the hedge impact on our cashSensitivity of the hedge impact on our cash
17
TAMTAM
Domestic Market
Domestic Market
Demand Growth (RPK)
We will maintain market leadership
Domestic
International
Supply Growth (ASK)
Domestic
International
Total approximate load factor
New international frequency or destination 2009
7% - 10%
- - -
- - -
8%
20%
67%
1
17.7%
45.6%
86.5%
10.4%
19.0%
68.5%
- - -
Guidancefor 2009
Guidancefor 2009
Realized2009
Realized2009
2009 Guidance
18
43
A340 2
A33016
A321 - 5
A32082
A31921
43
18
107
43
20
110
43
22
113
83
22
115
103
22
117
3Q09 2009 2010 2011 2012 2013
133 132137
142148 152
Total Fleet(end of period)
B767 Airbus wide-body Airbus narrow-bodyB777
Average fleet age of 6 years by the end of
3Q09
Average fleet age of 6 years by the end of
3Q09
Standardization of narrow body fleet:
A320 family
Standardization of narrow body fleet:
A320 family
Aircraft to be received in 2010 will replace the ones that will be redelivered and
already have pre committed financing
Aircraft to be received in 2010 will replace the ones that will be redelivered and
already have pre committed financing
Fleet Plan
We continue to increase the scope of our MRO
AuthoritiesAuthorities
Airframe andComponentsAirframe andComponents
ComponentsComponents
Airbus: A318; A319; A320; A321; A330
Boeing: B767
Fokker: F100
Airbus: A340
Boeing: B777
20
February 19, 2008
Contact
Investor Relations Department +55 11 [email protected]
www.tam.com.br/ir
Jorge Helito
Investor Relations Manager+55 11 5582-8147 [email protected]
Marcus Rodrigues
Investor Relations Coordinator+55 11 5582-8191 [email protected]
Suzana Michelin Ramos
Investor Relations Analyst+55 11 5582-9358 [email protected]
PhonePhone E-mailE-mail
