(Commission File No. 1-14862 )
Indicate by check mark whether the registrant by furnishing the information
contained in this Form is also thereby furnishing the information to the
Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.
Yes ______ No ___X___
EBITDA grows 82% and reaches R$461 million, the best performance in 2006
Net Revenue reachs R$3.3 billion in the 3Q06, the highest in two years
São Paulo, Brazil, November 8, 2006 --- BRASKEM S.A. (BOVESPA: BRKM5; NYSE: BAK; LATIBEX: XBRK), leader in the thermoplastic resins segment in Latin America and second largest Brazilian industrial company owned by the private sector, announced today its results for the third quarter of 2006 (3Q06).
The 3Q06 results set forth in this release are derived from Braskems consolidated results of operations, and have been compared with Braskems results for the third quarter of 2005 (3Q05) or with the second quarter of 2006 (2Q06), as indicated. The consolidated balance sheet, cash flow statement and income statement attached hereto have been subject to a limited review by Braskems independent auditors and reflect the elimination of the accounting effects of CVM Instruction 247 (therefore only those investments under Braskems direct control are consolidated, and Braskems stakes in COPESUL-Companhia Petroquímica do Sul and Petroflex Indústria e Comércio S.A. are recognized through the equity accounting method). These financial statements fully consolidate Politeno Indústria e Comércio S.A. since the 2Q06. Accordingly, this release reflects Braskems results of operations for the 3Q06 that include Politenos results of operations, as well as pro forma financial information that fully consolidates Politenos results of operations for the following periods: 3Q05, 9M05 and 9M06. The pro forma financial information is based on financial statements that have been subject to a limited review by independent external auditors. On September 30, 2006, the real / U.S. dollar exchange rate was R$2.1742 per U.S.$ 1.00.
1 . Highlights |
1.1 EBITDA Margin grows 5.2 p.p.: Braskem presented a 14.1% EBITDA margin in the 3Q06, compared to a 8.9% margin in the 2Q06 and a 12.9% in the 3Q05. This level of profitability confirms the strength of the company´s business model and its capacity to deliver good results in a challenging scenario, evidenced by the high levels of prices for oil and naphtha.
1.2 Economic and Financial Highlights:
1.3 10% Growth of the Brazilian Thermoplastic Resins Market: the Brazilian thermoplastic resins market (which includes polyethylene - PE, polypropylene - PP and PVC), taking into consideration domestic sales plus imports, grew by 10% in the 9M06, when compared to the 9M05 This performance confirms the strong elasticity of the thermoplastic resins market when compared the GDP. Over the 2Q06, growth in the 3Q06 was 4%.
1.4 100% Completion of the Buy-Back Program: On October, 23, Braskem completed 100% of its share buy-back program launched on May 4, 2006. The Company acquired 13.1 million class A preferred shares (PNA) and now holds 14.4 million PNA shares in treasury. From the 13.9 million PNA shares targeted for buy-back, 0.8 million correspond to the shares issued as a consequence of the merger of Polialden into Braskem that were not acquired by minority shareholders of Polialden who exercised their withdrawal rights.
For further information, access our IR website at www.braskem.com.br/ir or contact our IR team: | ||
Luiz Henrique Valverde | Luciana Ferreira | |
IRO | IR Manager | |
Phone: (+55 11) 3443 9744 | Phone: (+55 11) 3443 9178 | |
luiz.valverde@braskem.com.br | luciana.ferreira@braskem.com.br |
1.5 Innovation and Technology launch of the first Brazilian resin using nanotechnology:Braskem deposited its 3rd nanotechnology patent in the 3Q06 and announced the launch of the first Brazilian resin using nanotechnology, a PP application, on November 6, 2006. The expected production capacity amount to 10 thousand tons, and will be available to attend the automotive, electronic, and home appliances markets. This new resin is characterized as a lighter product, with greater heat resistance as well as greater protection to the sun light and to humidity. The Company has a team dedicated to research in this area, in line with its strategy of expanding its portfolio of higher value-added products.
1.6 Fórmula Braskem Successful implementation: On October 1, 2006, Braskem successfully started up its new integrated management system, Fórmula Braskem. As a result, beginning in 2007, the Company expects to capture efficiency and productivity gains derived from (1) systems integration, (2) a more efficient decision-making process and (3) from a comprehensive review of business processes, that occurred throughout the implementation of the project. Braskem invested R$ 130 million in this project and the company expects to capture, as of next year, R$ 260 million gains as net present value.
1.7 Successful new financial transactions in local and international markets: in order to improve even more its debt profile and further reduce its cost of capital, Braskem concluded three important financial transactions in September:
1.8 Petroquímica Paulínia project within schedule: the construction of the PP unit in Paulínia proceeds according to the initially planned schedule. The final construction permit was obtained. The foundations and the land scraping have already been initiated, the critical equipment has already been acquired and the process of technology transfer from Braskem to Petroquímica Paulínia was intensified in the 3Q06 specially in the engineering and human resources areas, with the training of technical personnel.
1.9 Corporate Governance obtains international recognition: According to GMI -GovernanceMetrics International, Braskem was one of the two companies with the highest corporate governance rating among Brazilian companies, scoring 6.0, 40% above the average for emerging market companies, which was 4.3, and 88% above the 3.2 average for the Brazilian companies.
2. Operational Performance |
Braskems operating strategy is based on the optimization of the use of its asset base with the maintenance of high capacity utilization rates in all of its Business Units. During the 3Q06, the Company had a record PP capacity utilization rate of 104% and its PE plants located in the Triunfo Complex (in the state of Rio Grande do Sul) also presented utilization rate above 100%. The ethylene capacity operating rate was impacted by operational restrictions in the olefins I plant (ethylene/propylene) in September. The PE (plants in the Camaçari Complex) and PVC capacity utilization rates have also been consequently impacted. These problems have already been solved and the plants are now operating normally. Yet, the resin production volumes in the 3Q06 were the highest ever registered by the company, which demonstrates improved reliability and adequate management of the industrial facilities.
The production capacity utilization rates of Braskems key products are shown as follows:
Production volumes of the Polyolefins Business Unit increased by 2% compared to both 2Q06 and the pro-forma production volume recorded in the 3Q05, due to the plants improved productivity. The production capacity utilization rates reached 104% for PP and 92% for PE in the 3Q06, thus maintaining capacity at high rates.
PE debottlenecking was concluded at the end of the 3Q06, thus adding 30,000 tons of additional production capacity of higher value added PE, notably Braskem Flexus®.
In the Vinyls Business Unit, the production capacity utilization rate of its principal product, PVC, was 87% in the 3Q06. Despite the increase when compared to the 2Q06 when a scheduled shutdown occurred in May the capacity utilization rate was impacted by the reduced production in the ethylene plant. PVC production volumes increased by 12% compared to the last quarter and fell by 1% compared to the 3Q05.
Braskem is already prepared to increase its annual production capacity of PVC by 150,000 tons, of which 70,000 tons will be produced in the Camaçari plant and 80,000 tons in the Alagoas plant. The projects will be implemented according to market needs. The growth potential presented by the housing and infrastructure construction markets for the upcoming years is already a positive signal.
In the 3Q06, the Basic Petrochemicals Business Unit, considering the production of its key products, ethylene and propylene, recorded a 2% and 6% decrease, compared to the 2Q06 and to the 3Q05, respectively, due to operational restrictions in Olefins I plant in September 2006. In the 9M06, production dropped 5%. On the other hand, the production of aromatics climbed 7% in the 3Q06 compared to the same period of last year.
Production Volume |
3Q06 |
2Q06 |
3Q05 |
Chg.% |
Chg.% |
9M06 |
9M05 |
Chg.% |
||||||||
(tons) |
(A) |
(B) |
(C) |
(A)/(B) |
(A)/(C) |
(D) |
(E) |
(D)/(E) |
||||||||
Polyolefins Unit | ||||||||||||||||
. PE´s - Polyethylene* | 288,931 |
290,983 |
290,567 |
(1) |
(1) |
848,624 |
853,609 |
(1) | ||||||||
. PP - Polypropylene | 146,303 |
135,155 |
136,308 |
8 |
7 |
402,894 |
395,923 |
2 | ||||||||
. Total (PE´s + PP) | 435,234 |
426,138 |
426,874 |
2 |
2 |
1,251,518 |
1,249,532 |
0 | ||||||||
Vinyls Unit | ||||||||||||||||
. PVC - Polyvinyl Chloride | 112,789 |
100,332 |
113,671 |
12 |
(1) |
322,540 |
339,870 |
(5) | ||||||||
. Caustic Soda | 118,222 |
95,782 |
111,983 |
23 |
6 |
326,306 |
349,889 |
(7) | ||||||||
Basic Petrochemical Unit | ||||||||||||||||
. Ethylene | 272,602 |
275,103 |
285,214 |
(1) |
(4) |
831,341 |
876,081 |
(5) | ||||||||
. Propylene | 127,539 |
133,054 |
142,345 |
(4) |
(10) |
395,961 |
419,042 |
(6) | ||||||||
. BTX** | 162,089 |
168,221 |
151,769 |
(4) |
7 |
478,027 |
502,525 |
(5) | ||||||||
*Includes 100% of Politeno | ||||||||||||||||
**BTX - Benzene, Toluene, Ortho-xylene and Para-xylene |
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3 . Commercial Performance |
Considering the domestic sales plus imports, the Brazilian thermoplastic resin market grew by 10% in the 9M06 compared to the 9M05 During the same period, the domestic PE, PP and PVC markets grew by 9%, 13% and 7%, respectively. These markets grew by 3%, 5% and 6%, respectively, in the 3Q06 compared to the 2Q06.
Braskem sold a total of 549,000 tons of thermoplastic resins in the 3Q06, considering the domestic sales plus imports in the 3Q06, which represented a 5% growth when compared to the 524,000 tons sold in the 2Q06. In the domestic market, the volume reached 416,000 tons in the 3Q06, a 5% growth over the 2Q06. Exports grew by 3%, reaching a total of 133,000 tons of thermoplastic resins. Braskems total sales volumes of thermoplastic resins increased by 5% compared to the 2Q06 sales volume of 524,000. When compared to 3Q05 pro-forma volume, sales fell by 6%, once the Company recorded an atypical high sales volume in the 3Q05.
Sales Volume |
3Q06 |
2Q06 |
3Q05 |
Chg.% |
Chg.% |
9M06 |
9M05 |
Chg.% |
||||||||
(tons) |
(A) |
(B) |
(C) |
(A)/(B) |
(A)/(C) |
(D) |
(E) |
(D)/(E) |
||||||||
Polyolefins Unit | ||||||||||||||||
. PE´s - Polyethylene* | 284,542 |
285,048 |
306,029 |
(0) |
(7) |
826,253 |
863,976 |
(4) | ||||||||
. PP - Polypropylene | 147,935 |
135,344 |
148,871 |
9 |
(1) |
404,899 |
396,339 |
2 | ||||||||
. Total (PE´s + PP) | 432,477 |
420,392 |
454,900 |
3 |
(5) |
1,231,151 |
1,260,314 |
(2) | ||||||||
Vinyls Unit | ||||||||||||||||
. PVC - Polyvinyl Chloride | 116,606 |
103,670 |
127,050 |
12 |
(8) |
332,020 |
337,377 |
(2) | ||||||||
. Caustic Soda | 107,190 |
101,189 |
115,583 |
6 |
(7) |
313,730 |
343,550 |
(9) | ||||||||
Basic Petrochemical Unit | ||||||||||||||||
. Ethylene | 52,477 |
58,382 |
60,001 |
(10) |
(13) |
169,345 |
184,726 |
(8) | ||||||||
. Propylene | 116,610 |
106,186 |
107,438 |
10 |
9 |
338,830 |
358,687 |
(6) | ||||||||
. BTX** | 137,794 |
131,442 |
136,140 |
5 |
1 |
387,903 |
443,751 |
(13) | ||||||||
*Includes 100% of Politeno | ||||||||||||||||
**BTX - Benzene, Toluene, Ortho-xylene and Para-xylene |
In the Polyolefins Business Unit, sales volumes of PE both domestically and in the export market, remained flat, compared to the 2Q06. Domestic sales volumes of PP increased by 7% in the 3Q06 compared to the last quarter and by 14% compared to the same period of 2005. Export sales volume of PP increased by 23% in the 3Q06 compared to the 2Q06.
The integration with Politeno has allowed Braskem to enhance its commercial strategy for PE and to offer an even more diversified portfolio of products and services to its customers, thus increasing the competitiveness in the production chain and adding value to Braskem´s customers.
In the Vinyls Business Unit, PVC domestic sales volumes increased by 15% when comparing to the 2Q06 and to the 3Q06, above market growth performance, caused mainly by the increase in the construction and footwear industries. Total sales increased by 12% over the 2Q06 and fell by 8% over the 3Q05.
In the Basic Petrochemicals Business Unit, ethylene sales volumes dropped 10% quarter-on-quarter. Propylene sales, which had been reduced in the 2Q06, returned to the levels recorded in the previous quarters. Total sales volumes of aromatics increased by 5% compared to the 2Q06, primarily as a result of increased export sales.
4 . Competitive Management |
4.1.
The purpose of Braskem +, a program created in 2004, is to position Braskem among the worlds most competitive petrochemical companies. This program also represents an important and additional potential for productivity gains for Braskem, estimated to total R$420 million on annual and recurring basis once the program is completed. Braskem + is structured to increase Braskems ability to create value in all stages of the petrochemical cycle.
The results achieved through the end of 9M06 represented gains amounting to R$359 million, on an annual and recurring basis, a figure that the Company had estimated to reach at the end of 2006. Braskem expects to accomplish the R$420 million estimated for the end of the program by December 2006, a year ahead of the original schedule.
The benefits of the Braskem + program are reflected in all of the Braskems units and include, for example:
4.2.
Since October 2005, Braskem has been working on the implementation of a new integrated management system denominated Fórmula Braskem, which is based on the SAP platform. This new system commenced operations on October 1, 2006 after one year of implementation, during which a team composed of 110 professionals revised all the Companys business processes. The key factors for the successful implementation of this project were the management of change process, synergies within all areas of the Company, intense technical support during start-up and the alliance established by SAP, Braskem and Accenture. Braskem invested R$130 million and it expects to capture R$260 million as a net present value of the cash flow of the project as of the next year, that will derive from cost reduction associated to the streamlining of business processes and improved management of the businesses.
5 . Financial and Economic Performance |
The demand for thermoplastic resins remained high in the 3Q06, with the domestic market recovering its historical levels of elasticity in relation to the GDP, leveraged by the growth of the Brazilian economy and the higher per capita income. Therefore, higher prices in the domestic market, combined with higher sales volumes, especially for PP and PVC, caused the Company to record a net revenue of R$3.3 billion in the 3Q06, which represented a 16% increase compared to the net revenue in the 2Q06.
When expressed in U.S. dollars, Braskems net revenue in the 3Q06 was US$ 1.5 billion, 16% higher than the last quarter and 21% higher than its pro-forma net revenue in the 3Q05 (US$ 1.2 billion).
Braskems commercial policy is to align the prices of its products sold domestically with international prices on a consistent basis. Thus, in the 3Q06, thermoplastic resin prices grew by 10% in the domestic market when compared to the previous quarter. Ethylene and propylene prices also had a considerable increase, moving up 16% for both products, in line with the prices upward trend registered in the European market.
As a result of the price increases implemented in the domestic market in the
6
3Q06, resin prices presented the following behavior:
Domestic and international prices for BTX (benzene, toluene and xylenes), in R$/ton, increased by 31%, when compared to the previous quarter primarily due to higher international benzene prices, which increased by 23% from June to September.
5.1.1 Exports
Braskem maintains its long term commitment to its clients and strategic markets. As such, the company is investing in the development of a direct relationship with its international clients. In line with this commercial strategy, Braskem started up commercial and marketing operations in Europe based in Rotterdam (the Netherlands). Such operation follows the same existing business model as in the current operations in the US, where the Company has a branch in Delaware, Braskem America, and in Argentina, Buenos Aires. In order to proceed with the feasibility studies of the strategic projects in El Tablazo and Jose Complex, the Company opened an office in Caracas, Venezuela.
The Companys net export revenue reached US$ 396 million in the 3Q06, 14% higher than the US$ 348 million recorded in the previous quarter. In the 9M06, exports reached US$1 billion and already outperformed the export figure for the whole year of 2005.
5.2. Cost of Good Sold (CoGS)
During the 3Q06, Braskems cost of goods sold (CoGS) was R$2.7 billion, 8% higher than the 2Q06 and 11% above the pro-forma CoGS in the 3Q05. Braskems 3Q06 CoGS was impacted in US$ 123 million, when compared to the 3Q05, by the 14% increase in the price of purchased naphtha, as a result of significant increases in oil prices. In addition, Braskems CoGS increased by US$ 4 million due to higher utilities costs (electricity, gas, steam, fuel oil and others). The 7% appreciation of the real against the U.S. dollar between the periods partially offset the impact of the above mentioned effects.
The average ARA (Amsterdam-Rotterdam-Antwerp) price of naphtha was US$ 595 per ton in the 3Q06, representing a 14% increase compared to the 3Q05 as previously mentioned, and in line with the previous quarter. This increase had an impact of R$208 million in the cost of naphtha, or +17%, in the 3Q06 compared to the 3Q05. The total cost of ethylene/propylene purchased from Copesul increased by 19%, or R$89 million, in the 3Q06 compared to 3Q05.
8 |
Due to the effectiveness of Provisional Measure 255 (MP 255) in March 2006, Braskem recorded a credit in the amount of 3.65% of the naphtha that is purchased (which percentage credit reflects the difference between the amount credited and debited by the Brazilian government in respect of PIS/COFINS). During the 3Q06, this tax credit positively affected Braskems CoGS by approximately R$66 million. In the first nine months, this impact reaches R$152 million.
Depreciation and amortization costs during the 3Q06 totaled R$139 million, 6% lower than the R$147 million in depreciation and amortization costs recorded in the 2Q06, and 30% higher than in the 3Q05 pro-forma cost. These increases were primarily due to the start-up of projects that Braskem concluded in 2005 and in the 1H06 and changes to the period over which programmed maintenance shutdown costs may be depreciated. As of January 2006, in compliance with IBRACONs Technical Interpretation No. 01/2006, Braskem is capitalizing costs incurred in scheduled maintenance shutdowns (i.e., recording these costs as an increase in fixed assets, as opposed to deferring these costs). The costs of these shutdowns may be depreciated until the commencement of the immediately succeeding scheduled maintenance shutdown, impacting the amount to be depreciated.
5.3. Selling, General and Administrative Expenses (SG&A)
Braskem is focused on maintaining its costs and expenses in competitive levels. Braskems general and administrative expenses totaled R$215 million in the 3Q06, in line with the 2Q06. In the 3Q06, the main impacts were: (i) general and administrative expenses related to the restructuring of the Polyolefins Business Unit as a result of the integration of Politeno (a R$6 million impact); (ii) costs of consulting services associated with the new financial transactions implemented in the 3Q06 (a R$3 million impact) and (iii) provision for doubtful accounts (a R$10 million impact).
5.4. EBITDABraskems EBITDA totaled R$461 million in the 3Q06, an 82% growth when compared to R$253 million in the 2Q06. When expressed in U.S. dollars, Braskems EBITDA in the 3Q06 totaled US$ 212 million, compared to US$ 116 million in the 2Q06.
9 |
EBITDA margin reached 14.1% in 3Q06, a 5.2 percentage points (pp) improvement compared to na EBITDA margin of 8.9% in 2Q06 and a 1.2 pp growth compared to the 12.9% in EBITDA margin during 3Q05. This result derives from better selling prices and volumes in 3Q06.
When compared to 3Q05, EBITDA growth reached 23% due to the alignment of resin and aromatics prices to those of international markets and partially offset by the significant increase in naphtha prices, Braskem´s major raw material, as well as increased costs of ethylene and propylene acquired from Copesul, in line with the increase in international oil prices and in energy costs (electricity, natural gas and fuel oil).
5.5. Investments in Subsidiaries and Associated Companies
In the 3Q06, Braskems results from investments in subsidiaries and associated companies totaled R$36 million, compared to R$45 million in the 2Q06, excluding the amortization of goodwill derived primarily from Braskems investments in Copesul and Petroflex.
(R$ thousand) | ||||||||||
Investments in Subsidiaries and Associated Companies | 3Q06 | 2Q06 | 3Q05 | 9M06 | 9M05 | |||||
Subsidiaries - Equity Method | 121 | (833) | 543 | (713) | (2,992) | |||||
Associated Companies - Equity Method | 35,520 | 42,929 | 23,781 | 140,950 | 150,881 | |||||
. Copesul | 31,934 | 37,672 | 37,212 | 130,720 | 144,738 | |||||
. Others | 3,587 | 5,257 | (13,432) | 10,230 | 6,141 | |||||
Exchange Variation | 447 | (366) | 908 | 229 | 12,549 | |||||
Others | 371 | 3,729 | 3,603 | 2,599 | 18,733 | |||||
Subtotal (before amortization) | 36,460 | 45,460 | 28,836 | 143,065 | 179,172 | |||||
Amortization of goodwill/negative goodwill | (22,674) | 26,024 | * | (38,144) | (35,083) | (114,279) | ||||
TOTAL | 13,786 | 71,484 | (9,308) | 107,982 | 64,893 | |||||
* Includes R$ 53 million of Polialden's negative goodwill write-off, as a consequence of its merger into Braskem |
10 |
Braskems net financial result in the 3Q06, excluding the effects of foreign exchange rate and monetary variations, was an expense of R$226 million, 46% higher than in the 2Q06, when it reached R$156 million.
The following graph presents the main impacts associated with this variation, of which we highlight: (i) R$ 29 million in expenses (commissions, taxes, fees, etc) related to new financial transactions implemented in September, as mentioned before; (ii) R$ 29 million related to a higher portion of the Companys cash position invested in R$/CDI, with impacts on monetary variation, resulting in a reduction in interest income.
(R$ million) | ||||||||||
3Q06 | 2Q06 | 3Q05 | 9M06 | 9M05 | ||||||
Financial Expenses | (359) | (302) | (7) | (645) | 52 | |||||
Interest / Vendor | (120) | (112) | (121) | (355) | (387) | |||||
Monetary Variation | (66) | (61) | (59) | (185) | (178) | |||||
Foreign Exchange Variation | (49) | (39) | 246 | 212 | 836 | |||||
CPMF/IOF/Income Tax/Banking Expenses | (39) | (29) | (26) | (88) | (81) | |||||
Other | (85) | (62) | (46) | (230) | (137) | |||||
Financial Revenue | 29 | 51 | (109) | (22) | (281) | |||||
Interest | 18 | 46 | 40 | 102 | 90 | |||||
Monetary Variation | 12 | 4 | 3 | 18 | 10 | |||||
Foreign Exchange Variation | (1) | 1 | (151) | (143) | (381) | |||||
Net Financial Result | (330) | (252) | (116) | (668) | (229) | |||||
(R$ million) | ||||||||||
3Q06 | 2Q06 | 3Q05 | 9M06 | 9M05 | ||||||
Net Financial Result | (330) | (252) | (116) | (668) | (229) | |||||
Foreign Exchange Variation (FXV) | (50) | (38) | 95 | 69 | 455 | |||||
Monetary Variation (MV) | (54) | (57) | (57) | (167) | (168) | |||||
Financial Result less F/X and MR | (226) | (156) | (154) | (570) | (515) | |||||
Braskem recorded a net income of R$4 million in the 9M06, and a net loss of R$65 million in the 3Q06, compared to net loss of R$54 million in the 2Q06.
11 |
The operating cash flow before changes in working capital totaled R$377 million in the 3Q06, compared to R$142 million in the 2Q06, primarily due to the improved operating performance evidenced by the higher EBITDA. Furthermore, Braskems additional working capital needs for the period totaled R$254 million. An increase in marketable securities, in the amount of R$320 million was the key factor for this result. According to the accounting criteria, securities with liquidity of more than 90 days can not be recorded as cash or cash equivalent but instead must be accounted as marketable securities. The allocation of resources in such securities aim at obtaining improved financial yields.
R$ million | 3Q06 | 2Q06 | 3Q05 | 9M06 | 9M05 | 9M06 | ||||||
REAL* | ||||||||||||
Operating Cash Flow before working capital | 377 | 142 | 297 | 809 | 1,393 | 793 | ||||||
Working Capital Variation | (254) | (142) | (204) | (697) | 290 | (683) | ||||||
Operating Cash Flow | 123 | 0 | 92 | 112 | 1,684 | 110 | ||||||
Interest paid | (169) | (93) | (113) | (337) | (255) | (337) | ||||||
Investment Activities | (336) | (463) | (320) | (973) | (646) | (963) | ||||||
Share Buy-back | (78) | (57) | - | (135) | - | (135) | ||||||
Free Cash Flow (FCF) | (460) | (613) | (341) | (1,334) | 782 | (1,325) | ||||||
Taxes paid | 1 | 7 | 17 | 14 | 39 | 13 | ||||||
Working Capital Variation | 3Q06 | 2Q06 | ||
Suppliers | 115 | 8 | ||
Inventories | 82 | (6) | ||
Accounts Receivable | (82) | (87) | ||
Marketable Securities | (320) | (11) | ||
Others | (49) | (45) | ||
Total | (254) | (142) | ||
Braskem has a financial policy approved by its board of directors that requires the maintenance of a minimum amount of cash compatible with the average total monthly cash outlays and the maturities of its short-term financial obligations. On September 30, 2006, Braskems cash and cash equivalents totaled R$1.6 billion, superior to the minimum R$1.2 billion established in its financial policy.
Braskem currently has sufficient resources in U.S. dollar to cover foreign exchange denominated payments due over the next 24 months. Such coverage is comprised of cash balances that have been invested in U.S. dollar instruments, foreign currency generated from its estimated net export sales and, when necessary, derivative instruments that protect it from exchange rate fluctuations.
Braskem is continuously focusing on (1) increasing its average debt maturity with the consequent longer-term maturity profile, (2) reducing its cost of debt, (3) becoming more efficient in allocating funds for its working capital needs, and (4) reducing its foreign exchange rate exposure. As of the end of the 3Q06, Braskem had 46% of its debt denominated in U.S. dollars, compared to 56% at the end of the 3Q05.
12
|
Braskems cash and cash equivalents amounted to R$1.6 billion on September 30, 2006, compared to R$1.3 billion on June 30, 2006.
Braskems net debt at the end of the 3Q06 was R$4.8 billion, compared to the R$4.6 billion recorded in the previous quarter. When expressed in U.S. dollars, Braskems net debt was US$ 2.2 billion in the 3Q06, compared to US$ 2.1 billion in the 2Q06. The increase in net debt is due to the increase in working capital needs and to the share buy-back program.
Braskems financial leverage, measured by its net debt/EBITDA (LTM) ratio, decreased from 2.97 on June 30, 2006 to 2.96 on September 30, 2006.
Braskems average debt maturity at the end of the 3Q06 is of 16 years. Excluding the convertible debentures due in 2007, Braskems current annual average debt maturities are below US$ 200 million, which Braskem believes to be consistent with its cash flow.
13 |
The following graph shows Braskems amortization schedule as of September 30, 2006.
6. Investments |
In the 9M06, Braskems capital expenditures, totaled R$590 million (does not include capitalized interest in an aggregate amount of R$62 million), compared to R$518 million in the 9M05. These investments were made in projects with attractive returns, as well as on the programs Braskem + and Fórmula Braskem and were allocated to operational (including the PE debottlenecking), technological, health, safety and environmental areas, benefiting all of Braskems business units.
14 |
The variation in capital expenditures when comparing both periods is primarily due to investments in the Basic Petrochemicals Unit - in the expansion of isoprene production capacity scheduled to be completed in November, with addition of 9,000 tons or 50% to existing production. Additionally, investments in Fórmula Braskem program also affected this variation.
In addition to these investments, Braskem disbursed R$107 million in scheduled maintenance shutdowns, in order to maintain the high levels of operational reliability of Braskems plants.
7. Politeno Main Figures |
Politenos integration process was successfully completed and Braskem has already begun to capture the expected synergies initially estimated at a net present value of US$ 110 million. Through September 2006, the Company had already captured US$2.5 million in synergies, net of integration costs. On an annual and recurring base, the Company has already captured gains in the amount of US$16.8 million. Braskem is working to merge Politeno into itself in the second quarter of 2007, when it is expected that these gains will be accelerated and therefore fully achieved by the end of 2007.
Politenos sales volume totaled 80,000 tons of PE and EVA in the 3Q06, 7% up on the previous quarter, and 73% of the sales volume were derived from domestic sales. As it was the case in other Braskem´s PE plants, domestic prices of Politenos PE increased by 4%, in R$/ton. As a result of improved sales performance, Politenos EBITDA totaled R$9 million in the 3Q06.
Politeno has a low financial leverage, with net debt totaling approximately R$31 million, R$47 million less than in the previous quarter due to amortizations during the period.
7.1 Economic and Financial Highlights
Politeno - Highlights | 3Q06 | 2Q06 | Var % | 9M06 | ||||
Production Volume (ton) | 80,906 | 86,693 | -7% | 252,857 | ||||
Sales Volume (ton) | 79,923 | 74,779 | 7% | 241,102 | ||||
Financial Performance (R$ MM) | ||||||||
Net Revenue | 259 | 229 | 13% | 766 | ||||
EBITDA | 9 | (4) | - | 21 | ||||
EBITDA Margin | 3% | -2% | - | 3% | ||||
Net Income | (3) | (11) | -73% | (6) | ||||
Net Debt | 31 | 78 | -60% | 31 | ||||
8 . Capital Markets and Investor Relations |
Braskems class A preferred shares traded on the BOVESPA (BRKM5) closed the quarter at R$13.53 per share. Braskems ADR (BAK) closed the quarter at US$12.59 per ADR.
On September 1, 2006, Bovespa announced Ibovespas theoretical portfolio valid for the period between September and December 2006. Braskem remains amongst the 10 most liquid companies on the Bovespa, with a 2.42% share of the total traded volume. Braskem accounted for 76% of all the volume traded in the petrochemical industry on the Bovespa.
Braskems publicly traded shares and class A preferred shares reached approximately 50.3% and 67.6% of its total share capital (Free-Float), respectively, and the liquidity of the shares on the BOVESPA and the NYSE remained in significantly high levels over the last quarters.
The daily volume of Braskems class A preferred shares traded on the BOVESPA (BRKM5) increased from 1.4 million shares in 3Q05 to 1.7 million in 3Q06. In the same period, the financial trading
15 |
volume dropped by 31%, from an average of R$31.1 million traded per day on average in 3Q05 to R$21.5 million traded per day on average in the 3Q06, reflecting the reduction of Braskems share price. The average daily trading volume of Braskems ADRs (BAK) on the NYSE fell 56%, from US$ 5.0 million per day in the 3Q05 to an average of US$ 2.2 million per day in the 2Q06.
In September, Braskem was one of the two companies with the highest corporate governance rating among Brazilian companies, according to GovernanceMetrics International. In a scale from 1 to 10, Braskem scored 6.0, 40% above the 4.3 average for emerging markets and 88% above the 3.2 average for the Brazilian companies analyzed.
On October 23, 2006, Braskem completed the share buy-back program launched on May 4, 2006. Braskem acquired 13.1 million class A preferred shares (PNA) and now holds 14.4 million PNA shares in treasury.
On the same date, Braskem, once again, hosted a meeting with investors at the NYSE, where it presented its strategic growth plans and restated its commitment to transparency and full disclosure to the capital markets. On that day, the Companys executives participated in the NYSEs opening bell ceremony (trade start-up).
Stock Performance - BRKM5 | 9/30/05 | 12/31/05 | 3/31/06 | 6/30/06 | 9/30/06 | |||||
Closing Price (R$ per share) | 21.87 | 18.07 | 15.96 | 13.29 | 13.53 | |||||
Return in the Quarter (%) | 18 | (17) | (12) | (17) | 2 | |||||
Accumulated Return (%)* | 750 | 603 | 521 | 417 | 426 | |||||
Bovespa Index Accumulated Return (%)* | 180 | 197 | 237 | 225 | 223 | |||||
Average Daily Trading Volume (R$ thousand) | 31,059 | 25,489 | 26,921 | 24,256 | 21,513 | |||||
Market Capitalization (R$ million) | 8,100 | 6,694 | 5,912 | 4,923 | 5,012 | |||||
Market Capitalization (US$ million) | 3,645 | 2,860 | 2,721 | 2,274 | 2,305 | |||||
ADR Performance - BAK | 9/30/05 | 12/31/05 | 3/31/06 | 6/30/06 | 9/30/06 | |||||
Closing Price (R$ per ADR) | 20.72 | 16.21 | 14.91 | 12.19 | 12.59 | |||||
Return in the Quarter (%) | 23 | (22) | (8) | (18) | 3 | |||||
Accumulated Return (%)* | 1,156 | 882 | 804 | 639 | 663 | |||||
Average Daily Trading Volume (US$ thousand) | 5,011 | 3,927 | 4,881 | 3,032 | 2,212 | |||||
Other Information | 9/30/05 | 12/31/05 | 3/31/06 | 6/30/06 | 9/30/06 | |||||
Total Number of Shares (million) | 362,524 | 362,524 | 362,524 | >370,402 | 370,402 | |||||
. Common Shares (ON) - BRKM3 | 120,860 | 120,860 | 120,860 | 123,492 | 123,492 | |||||
. Preferred Shares Class "A" (PNA) - BRKM5 | 240,860 | 240,860 | 240,860 | 246,107 | 246,107 | |||||
. Preferred Shares Class "B" (PNB) | 803 | 803 | 803 | 803 | 803 | |||||
(-) Shares in Treasury (PNA) - BRKM5 | (467) | (467) | (467) | (4,471) | (11,163) | |||||
= Total Number of Shares (ex Treasury) | 362,056 | 362,056 | 362,056 | 365,931 | 359,239 | |||||
ADR (American Depositary Receipt) | 1 ADR = 2 BRKM5 shares |
|||||||||
* Accumulated return since the market closing on December 30, 2002. | ||||||||||
Source: Economática/Braskem |
9. Outlook |
Braskem expects that the economic growth experienced so far will be sustained during the 4Q06 as well as in 2007, which should positively affect its sales performance for the thermoplastic resins. If GDP growth reaches 3%, as expected, thermoplastic resins market should grow between 8% and 12%, from 300,000 to 450,000 tons. Braskem should substantially benefit from this growth since it is the market leader, holding a market share of approximately 43%, and may reallocate part of its exports to the domestic market, where profitability is higher than those in the export market.
With respect to prices for its thermoplastic resins, Braskem will maintain its policy of privileging profitability in the sale of its products, providing high value-added services to its customers supported by a differentiated structure of Innovation and Technology. This strategy has allowed Braskem to maintain over time domestic prices for PE, PP and PVC that are higher than international prices. In the 3Q06, these spreads had an important recovery compared to the 2Q06 due to the successful
16 |
realignment of prices in the domestic market. For the 4Q06, Braskem will keep its efforts in realign its domestic prices to international prices aiming at additional profitability improvement.
For 2007, the Company believes that the global market for thermoplastic resins should continue to present a higher growth rate in demand than in supply, with sustainable high international prices.
Braskems principal raw materials are naphtha, which is used by its Basic Petrochemicals Business Unit, and ethylene and propylene, both of which are acquired from Copesul and used in Braskems second generation plants in the Southern Petrochemical Complex in Triunfo. These raw materials represented 75% of Braskems CoGS in the 3Q06, and the cost of these raw materials is closely linked with the price of oil.
As of September, oil prices, and consequently, naphtha prices presented a strong reduction in international markets, signaling an important reduction in Braskems 4Q06 COGS. For 2007, estimates from oil&gas analysts show lower average prices for oil when compared to the average for 2006, with potential positive effects on both domestic and international petrochemical industries.
In order to take advantage of the lower oil prices scenario for 2007, Braskem decided that the maintenance shutdown in the Olefinas I unit, initially scheduled for the third quarter of 2007, will be divided into two periods: a mini 10-day shutdown in December 2006, so that Braskem will interrupt ethylene and propylene production in this unit in a month when the impact on resin sales is potentially lower due to the seasonality of the period. In addition to that, the Company has inventories to prevent the shutdown from affecting its clients operations in the period. The full 30-day shutdown was postponed to 2008.
Consistent with its strategy to maintain its leadership in the regional thermoplastic resins market, Braskem is investing, together with Petrobras, in the construction of a new polypropylene plant in Paulínia, São Paulo with an annual production capacity of 350,000 tons. The start-up of operations is scheduled for the first quarter of 2008 (with initial annual estimated production of 300,000 tons). Braskem holds a 60% stake in Petroquímica Paulínia.
Braskem expects to capture gains of R$420 million on annualized and recurring basis until the end of 2006 with the full implementation of the Braskem + program. These results will derive from productivity gains obtained through improved efficiency and higher operational reliability in the production facilities of the company. In addition, the project Fórmula Braskem, whose net present value is R$260 million, became operational in October 2006.
One of Braskems strategic drivers is the production and sale of petrochemical products at globally competitive costs. Accordingly, , Braskem is analyzing, together with Pequiven, the construction of a polypropylene plant in El Tablazo, Venezuela, with an annual production capacity of 400,000 tons. The expected investments for this plant total US$ 370 million, and this plant is expected to commence operations by the end of 2009. Also in Venezuela, Braskem is at an advanced stage in analyzing the construction of a new cracker to produce ethylene with natural gas, together with the integrated production of polyethylene and other second generation products in the Jose Complex. The basic premise for constructing this complex is that it would become competitive with low-cost producers located in the Middle East. The project is a joint venture between Braskem and Pequiven and is currently in the technical and economic feasibility study stage. To meet the work demands of these projects, Braskem has begun to mobilize working groups for each project and is opening a branch office in Venezuela to oversee these investments and move them forward.
17 |
10 . List of Exhibits |
Page | ||
EXHIBIT I | Consolidated Income Statement | 19 |
EXHIBIT II | Consolidated Balance Sheet | 20 |
EXHIBIT III | Reconciliation of Shareholders Equity and Net Income | 21 |
EXHIBIT IV | Consolidated Cash Flow | 22 |
EXHIBIT V | Sale Volumes Domestic Market | 23 |
EXHIBIT VI | Sale Volumes Export Market | 24 |
EXHIBIT VII | Net Revenue - Domestic Market | 25 |
EXHIBIT VIII | Net Revenue - Export Market | 26 |
Braskem, a world-class Brazilian petrochemical company, is the leader in the thermoplastic resins segment in Latin American, and is the second largest Brazilian industrial company owned by the private sector. The company operates 14 manufacturing
plants located throughout Brazil, and it has an annual production capacity of 6.1 million tons of petrochemical and chemical products. |
FORWARD-LOOKING STATEMENT DISCLAIMER
This press release contains statements that are forward-looking within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such forward-looking statements are only predictions and are not guarantees of future performance. Investors are cautioned that any such forward-looking statements are and will be, as the case may be, subject to many risks, uncertainties and factors relating to the operations and business environments of Braskem and its subsidiaries that may cause the actual results of the companies to be materially different from any future results expressed or implied in such forward-looking statements.
Factors that could cause actual results to differ materially from these forward-looking statements include, but are not limited to, the risks and uncertainties set forth from time to time in Braskem's reports filed with the United States Securities and Exchange Commission. Although Braskem believes that the expectations and assumptions reflected in the forward-looking statements are reasonable based on information currently available to Braskems management, Braskem cannot guarantee future results or events. Braskem expressly disclaims a duty to update any of the forward-looking statements.
|
18 |
EXHIBIT I
Consolidated
Income Statement (1)
(R$ million)
Braskem S.A. (Consolidated) | |||||||||
Income Statement | 3Q06 (A) |
2Q06 (B) |
3Q05 (C) | Chg. (%) (A)/(B) | Chg. (%) (A)/(C) | 9M06 (D) | 9M05 (E) | Chg. (%) (D)/(E) | 9M06 REAL* |
Gross revenue | 4,183 | 3,650 | 3,800 | 15 | 10 | 11,351 | 11,810 | (4) | 11,258 |
Net revenue | 3,277 | 2,832 | 2,909 | 16 | 13 | 8,837 | 9,078 | (3) | 8,744 |
Cost of goods sold | (2,742) | (2,531) | (2,463) | 8 | 11 | (7,597) | (7,131) | 7 | (7,546) |
Gross profit | 535 | 302 | 446 | 77 | 20 | 1,240 | 1,948 | (36) | 1,198 |
Selling expenses | (83) | (83) | (77) | (1) | 7 | (248) | (234) | 6 | (227) |
General and Administrative expenses | (132) | (133) | (120) | (0) | 10 | (378) | (363) | 4 | (372) |
Depreciation and amortization | (99) | (102) | (75) | (3) | 31 | (284) | (271) | 5 | (281) |
Other operating income (expenses) | 3 | 21 | 18 | (86) | (83) | 115 | 33 | 254 | 116 |
Investments in Associated Companies | 14 | 71 | (9) | (81) | - | 108 | 65 | 66 | 109 |
.Equity Result |
36 | 45 | 29 | (20) | 26 | 143 | 179 | (20) | 144 |
.Amortization of goodwill/negative goodwill | (23) | 26 | (38) | - | (41) | (35) | (114) | (69) | (35) |
Operating profit before financial result | 238 | 76 | 183 | 211 | 30 | 554 | 1,177 | (53) | 543 |
Net operating result | (330) | (252) | (116) | 31 | 185 | (668) | (229) | 192 | (663) |
Operating profit (loss) | (92) | (175) | 67 | (47) | - | (114) | 948 | - | (120) |
Other non-operating revenue (expenses) | (1) | 3 | 0 | - | - | 2 | (17) | - | 2 |
Profit (loss) before income tax and social contribution | (93) | (172) | 67 | (46) | - | (112) | 932 | - | (118) |
Income tax / social contribution | 29 | 120 | (21) | (76) | - | 119 | (220) | - | 122 |
Profit (loss) before minority interest | (65) | (52) | 46 | 25 | - | 7 | 711 | (99) | 4 |
Minority Interest | 0 | (2) | (0) | - | - | (1) | (3) | (68) | (1) |
Net profit (loss) | (65) | (54) | 46 | 20 | - | 6 | 708 | (99) | 4 |
EBITDA | 461 | 253 | 374 | 82 | 23 | 1,131 | 1,706 | (34) | 1,114 |
EBITDA Margin | 14.1% | 8.9% | 12.9% | +5.2 p.p. | +1.2 p.p. | 12.8% | 18.8% | -6.0 p.p. | 12.7% |
-Depreciacion and Amortization | 237 | 249 | 182 | (4) | 30 | 686 | 594 | 15 | 680 |
. Cost |
139 | 147 | 107 | (6) | 30 | 402 | 322 | 25 | 399 |
. Expense |
99 | 102 | 75 | (3) | 31 | 284 | 271 | 5 | 281 |
1- Excludes the effects of the proportional consolidation (CVM-247) and includes the effects of CVM 408 Pro forma data for 3Q05, 9M06 (except 9M06 REAL) and 9M05
2- Includes 100% of Politenos results only as of April 2006.
19 |
EXHIBIT II
Consolidated
Balance Sheet
(R$ million)
ASSETS | 9/30/2006 (A) |
6/30/2006 (B) |
Chg. (%) (A)/(B) |
Current Assets | 5,354 | 5,089 | 5 |
. Cash and Cash Equivalents | 1,597 | 1,343 | 19 |
. Account Receivable | 1,724 | 1,669 | 3 |
. Inventories | 1,463 | 1,552 | (6) |
. Recoverable Taxes | 393 | 365 | 8 |
. Next Fiscal Year Expenses | 43 | 28 | 53 |
. Others | 134 | 132 | 2 |
Long-Term Assets | 1,574 | 1,559 | 1 |
. Related Parties | 58 | 95 | (39) |
. Compulsory Deposits | 177 | 174 | 2 |
. Deferred income taxes and social contributions | 388 | 427 | (9) |
. Recoverable Taxes | 812 | 758 | 7 |
. Others | 139 | 106 | 32 |
Fixed Assets | 8,778 | 8,636 | 2 |
.Investments | 809 | 773 | 5 |
.Plant, property and equipment | 6,213 | 5,996 | 4 |
.Deferred | 1,755 | 1,867 | (6) |
Total Assets | 15,705 | 15,284 | 3 |
LIABILITIES AND SHAREHOLDERS' EQUITY | 9/30/2006 (A) |
6/30/2006 (B) |
Var. (%) (A)/(B) |
Current | 4,790 | 3,900 | 23 |
. Suppliers | 2,774 | 2,663 | 4 |
. Short-term financing * | 1,700 | 937 | 81 |
. Salaries and social charges | 129 | 100 | 29 |
. Proposed dividends/interest attributable to shareholders | 3 | 4 | (0) |
. Income Tax Payable | 0 | 1 | 0 |
. Receivable Taxes | 98 | 123 | (20) |
. Advances from Clients | 12 | 12 | 2 |
. Others | 73 | 60 | 22 |
Long-Term Liabilities | 6,399 | 6,686 | (4) |
. Long-term financing | 4,688 | 5,009 | (6) |
. Taxes Payable | 1,526 | 1,502 | 2 |
. Others | 185 | 174 | 6 |
Deferred Income | 104 | 105 | (1) |
Minority Interest | 21 | 21 | (1) |
Shareholders' Equity | 4,391 | 4,572 | (4) |
. Capital | 3,508 | 3,508 | 0 |
. Capital Reserves | 404 | 401 | 1 |
. Treasury Shares | (198) | (120) | 65 |
. Profit reserve | 806 | 806 | - |
. Retained Earnings (Losses) | (129) | (23) | 471 |
Total Liabilities and Shareholders' Equity | 15,705 | 15,284 | 3 |
* Includes R$1,099 million from convertible debentures held by Odebrecht, transferred in July 06 |
20 |
EXHIBIT III
Reconciliation of Shareholders Equity and Net Income
(R$ million)
Reconciliation of Shareholders' Equity and Net Income - CVM 247 (R$ million) | |||
Shareholders' | Net Income | ||
Equity | |||
Sep 06 | 9M06 | ||
Pro Forma Consolidated - does not include CVM 247 | 4,391 | 6 | |
Effects of Politeno's pro forma Consolidation | (33) | (2) | |
Consolidated Real - does not include CVM 247 | 4,358 | 4 | |
Gain on the assignment of right of use between related parties | (35) | 20 | |
Consolidated including CVM 247 | 4,323 | 23 | |
21 |
EXHIBIT IV
Consolidated Cash Flow (1)
(R$ million)
Cash Flow | 3Q06 | 2Q06 | 3Q05 | 9M06 | 9M05 | 9M06 REAL |
Net Income for the Period | (65) | (54) | 46 | 6 | 708 | 4 |
Expenses (Revenues) not affecting Cash | 442 | 196 | 251 | 803 | 685 | 790 |
Depreciation and Amortization | 237 | 244 | 182 | 680 | 594 | 675 |
Equity Result | (16) | (72) | 10 | (110) | (64) | (111) |
Interest, Monetary and Exchange Restatement, Net | 248 | 124 | 38 | 422 | 3 | 418 |
Minority Interest | (0) | 2 | (2) | 1 | 1 | 1 |
Others | (27) | (103) | 22 | (190) | 151 | (193) |
Adjusted Profit (loss) before cash financial effects | 377 | 142 | 297 | 809 | 1,393 | 793 |
Cash Effect on Politeno Acquisition | 0 | 0 | 0 | 0 | 0 | 13 |
Asset and Liabilities Variation, Current and Long Term | (254) | (142) | (204) | (697) | 290 | (697) |
Asset Decutions (Additions) | (394) | (131) | (200) | (749) | (206) | (736) |
Marketable Securities | (320) | (11) | (13) | (411) | (13) | (411) |
Account Payable | (82) | (87) | (169) | (183) | (165) | (169) |
Recoverable Taxes | (56) | (111) | (65) | (240) | (161) | (230) |
Inventories | 82 | (6) | 10 | (10) | 0 | (12) |
Advances Expenses | (14) | 12 | 19 | 8 | 38 | 8 |
Dividends Received | 29 | 81 | 38 | 138 | 136 | 131 |
Other Account Receivables | (33) | (10) | (19) | (53) | (41) | (53) |
Liabilities Additions (Reductions) | 140 | (10) | (4) | 52 | 496 | 39 |
Suppliers | 115 | 8 | (18) | 76 | 503 | 65 |
Advances to Clients | 0 | (20) | (46) | (24) | (18) | (24) |
Fiscal Incentives | 3 | (6) | 4 | 7 | 69 | 5 |
Taxes and Contributions | (26) | 9 | 7 | (73) | (19) | (72) |
Others | 48 | (1) | 49 | 65 | (37) | 66 |
Cash resulting from operating activities | 123 | 0 | 92 | 112 | 1,684 | 110 |
Investment Activities | (336) | (463) | (320) | (973) | (646) | (963) |
Investmen Allocation | 0 | (237) | (42) | (236) | (58) | (236) |
Fixed Assets Allocation | (325) | (200) | (165) | (695) | (427) | (684) |
Deferred Assets Allocation | (11) | (27) | (113) | (43) | (161) | (43) |
Subsidiaries and Affiliated Companies, Net | (1) | (4) | 4 | (6) | (150) | (6) |
Financing Activities | 208 | (317) | (671) | (93) | (689) | (97) |
Inflows | 2,005 | 1,460 | 353 | 3,958 | 1,998 | 3,883 |
Amortization and Paid Interest | (1,739) | (1,392) | (1,029) | (3,573) | (2,453) | (3,496) |
Share Buy-Back | (78) | (57) | 0 | (135) | 0 | (135) |
Dividend/Interest attributable to Shareholders | 20 | (328) | 5 | (343) | (234) | (349) |
Cash and Cash Equivalents Increase (Reduction) | (5) | (784) | (895) | (960) | 199 | (955) |
Cash and Cash Equivalents at the beginning of period | 1,130 | 1,914 | 2,836 | 2,086 | 1,743 | 2,079 |
Cash and Marketable Securities at the end of period | 1,126 | 1,130 | 1,942 | 1,126 | 1,942 | 1,124 |
22 |
EXHIBIT V
Pro Forma Sales Volume Domestic Market
(thousand tons)
DOMESTIC MARKET - Sales Volume | ||||||||||||||
Sales Volume - ton | 1Q05 | 2Q05 | 3Q05 | 4Q05 | 1Q06 | 2Q06 | 3Q06 | |||||||
Polyolefins Unit | ||||||||||||||
. PE´s - Polyethylene | 195,455 | 180,441 | 218,280 | 187,604 | 176,336 | 180,328 | 178,271 | |||||||
. PP - Polypropylene | 107,969 | 98,227 | 112,384 | 101,283 | 108,761 | 119,469 | 128,347 | |||||||
. Total (PE´s + PP) | 303,423 | 278,668 | 330,664 | 288,887 | 285,098 | 299,797 | 306,618 | |||||||
Vinyls Unit | ||||||||||||||
. PVC - Polyvinyl Chloride | 84,909 | 90,329 | 109,754 | 93,894 | 98,914 | 95,361 | 109,647 | |||||||
. Caustic Soda | 119,137 | 108,829 | 115,583 | 112,077 | 105,351 | 101,189 | 107,190 | |||||||
. EDC | - | - | - | - | - | - | - | |||||||
. Chlorine | 14,960 | 15,670 | 15,710 | 14,912 | 14,002 | 14,499 | 15,163 | |||||||
- | - | - | - | - | - | - | ||||||||
Basic Petrochemical Unit | ||||||||||||||
. Ethylene | 62,708 | 62,017 | 60,001 | 58,301 | 58,485 | 58,382 | 52,477 | |||||||
. Propylene | 82,916 | 110,339 | 101,938 | 112,930 | 86,427 | 80,827 | 87,349 | |||||||
. Benzene | 35,587 | 36,610 | 30,712 | 36,204 | 39,387 | 38,572 | 34,172 | |||||||
. Butadiene | 39,807 | 38,133 | 27,753 | 44,509 | 31,515 | 38,104 | 37,947 | |||||||
. Toluene | 8,115 | 7,509 | 7,729 | 6,022 | 7,921 | 7,854 | 8,172 | |||||||
. Fuel | 54,325 | 54,824 | 110,311 | 107,854 | 73,594 | 120,030 | 76,918 | |||||||
. Para-xylene | 33,288 | 31,895 | 31,978 | 28,229 | 14,940 | 9,155 | 16,425 | |||||||
. Ortho-xylene | 9,496 | 7,648 | 11,689 | 12,449 | 13,241 | 15,146 | 16,749 | |||||||
. Isoprene | 3,403 | 3,198 | 2,903 | 3,222 | 3,290 | 4,226 | 3,436 | |||||||
. Butene 1 | 4,724 | 5,554 | 5,509 | 5,808 | 5,875 | 5,754 | 5,768 | |||||||
. Mixed Xylene | 8,848 | 7,793 | 9,494 | 9,244 | 8,528 | 7,987 | 9,461 | |||||||
- | - | - | - | - | - | - | ||||||||
Business Development | ||||||||||||||
. PET | 16,015 | 10,386 | 19,626 | 10,562 | 9,152 | 11,297 | 14,957 | |||||||
. Caprolactam | 9,532 | 8,157 | 8,382 | 6,940 | 8,927 | 8,501 | 4,862 | |||||||
23 |
EXHIBIT VI
Pro Forma Sales Volume Export Market
(thousand tons)
EXPORT MARKET - Sales Volume | ||||||||||||||
Sales Volume - ton | 1Q05 | 2Q05 | 3Q05 | 4Q05 | 1Q06 | 2Q06 | 3Q06 | |||||||
Polyolefins Unit | ||||||||||||||
. PE´s - Polyethylene | 94,338 |
87,713 | 87,749 | 69,527 | 80,328 | 104,719 | 106,271 | |||||||
. PP - Polypropylene | 22,599 |
18,673 | 36,487 | 19,880 | 12,858 | 15,876 | 19,588 | |||||||
. Total (PE´s + PP) | 116,937 | 106,386 | 124,236 | 89,408 | 93,186 | 120,595 | 125,859 | |||||||
Vinyls Unit | ||||||||||||||
. PVC - Polyvinyl Chloride | 10,667 |
24,423 | 17,296 | 10,669 | 12,831 | 8,309 | 6,958 | |||||||
. Caustic Soda | - |
- | - | 8,993 | - | - | - | |||||||
. EDC | 30,552 |
38,615 | 31,946 | 21,121 | 38,980 | 34,145 | 17,969 | |||||||
. Chlorine | - |
- | - | - | - | - | - | |||||||
Basic Petrochemical Unit | ||||||||||||||
. Ethylene | - |
- | - | - | - | - | - | |||||||
. Propylene | 46,392 |
11,602 | 5,500 | 7,812 | 29,606 | 25,359 | 29,261 | |||||||
. Benzene | 54,469 |
75,287 | 51,486 | 62,167 | 41,092 | 43,396 | 53,472 | |||||||
. Butadiene | - |
- | 12,472 | - | 6,376 | 3,200 | - | |||||||
. Toluene | - |
- | - | - | - | - | - | |||||||
. Fuel | 49,950 |
66,797 | - | 189 | - | - | 30,777 | |||||||
. Para-xylene | - |
- | - | - | - | 13,226 | 5,248 | |||||||
. Ortho-xylene | 4,568 | 3,141 | 2,544 | 5,619 | 2,087 | 4,093 | 3,556 | |||||||
. Isoprene | 1,380 | 1,206 | 835 | 853 | 13 | 14 | 14 | |||||||
. Butene 1 | - | 2,576 | 1,705 | - | 1,540 | - | - | |||||||
. Mixed Xylene | 7,841 | 6,140 | 5,619 | 520 | 6,885 | 2,060 | 3,828 | |||||||
Business Development | ||||||||||||||
. PET | 100 | 450 | 3,025 | 250 | 425 | 10,650 | 1,304 | |||||||
. Caprolactam | 3,997 | 6,966 | 3,571 | 706 | 4,771 | 2,871 | 4,860 | |||||||
24 |
EXHIBIT VII
Pro Forma Net Revenue Domestic Market
(R$ million)
DOMESTIC MARKET - Net Revenue | ||||||||||||||
R$ - million | 1Q05 | 2Q05 | 3Q05 | 4Q05 | 1Q06 | 2Q06 | 3Q06 | |||||||
Polyolefins Unit | ||||||||||||||
. PE´s - Polyethylene | 660 | 584 | 621 | 600 | 556 | 534 | 595 | |||||||
. PP - Polypropylene | 392 | 336 | 345 | 331 | 347 | 374 | 444 | |||||||
. Total (PE´s + PP) | 1,052 | 921 | 965 | 930 | 902 | 907 | 1,039 | |||||||
Vinyls Unit | ||||||||||||||
. PVC - Polyvinyl Chloride | 290 | 257 | 257 | 237 | 245 | 228 | 278 | |||||||
. Caustic Soda | 124 | 109 | 108 | 109 | 101 | 86 | 85 | |||||||
. EDC | - | - | - | - | - | - | - | |||||||
. Chlorine | 8 | 9 | 20 | 9 | 7 | 7 | 8 | |||||||
Basic Petrochemical Unit | ||||||||||||||
. Ethylene | 149 | 147 | 112 | 132 | 129 | 139 | 145 | |||||||
. Propylene | 179 | 241 | 198 | 249 | 179 | 155 | 200 | |||||||
. Benzene | 83 | 99 | 59 | 64 | 63 | 69 | 80 | |||||||
. Butadiene | 85 | 82 | 63 | 101 | 73 | 85 | 95 | |||||||
. Toluene | 14 | 12 | 12 | 9 | 12 | 14 | 18 | |||||||
. Fuel | 45 | 45 | 113 | 100 | 72 | 124 | 76 | |||||||
. Para-xylene | 81 | 71 | 59 | 72 | 31 | 20 | 47 | |||||||
. Ortho-xylene | 22 | 17 | 22 | 26 | 26 | 30 | 41 | |||||||
. Isoprene | 13 | 16 | 14 | 15 | 17 | 23 | 19 | |||||||
. Butene 1 | 13 | 14 | 12 | 13 | 14 | 13 | 16 | |||||||
. Mixed Xylene | 15 | 13 | 16 | 18 | 17 | 17 | 25 | |||||||
Business Development | ||||||||||||||
. PET | 66 | 38 | 62 | 35 | 27 | 33 | 46 | |||||||
. Caprolactam | 61 | 54 | 47 | 36 | 42 | 41 | 25 | |||||||
Others | 124 | 187 | 177 | 212 | 188 | 79 | 173 | |||||||
Total | 2,421 | 2,332 | 2,315 | 2,368 | 2,145 | 2,072 | 2,417 |
25 |
EXHIBIT VIII
Pro Forma Net Revenue Export Market
(R$ million)
EXPORT MARKET - Net Revenue | ||||||||||||||
R$ - million | 1Q05 | 2Q05 | 3Q05 | 4Q05 | 1Q06 | 2Q06 | 3Q06 | |||||||
Polyolefins Unit | ||||||||||||||
. PE´s - Polyethylene | 282 | 246 | 226 | 203 | 208 | 271 | 315 | |||||||
. PP - Polypropylene | 62 | 46 | 85 | 50 | 32 | 41 | 54 | |||||||
. Total (PE´s + PP) | 344 | 292 | 311 | 253 | 239 | 313 | 369 | |||||||
Vinyls Unit | ||||||||||||||
. PVC - Polyvinyl Chloride | 26 | 43 | 27 | 21 | 23 | 16 | 15 | |||||||
. Caustic Soda | - | - | - | 8 | - | - | - | |||||||
. EDC | 38 | 38 | 14 | 6 | 14 | 17 | 12 | |||||||
. Chlorine | - | - | - | - | - | - | - | |||||||
Basic Petrochemical Unit | ||||||||||||||
. Ethylene | - | - | - | - | - | - | - | |||||||
. Propylene | 104 | 20 | 10 | 14 | 49 | 43 | 54 | |||||||
. Benzene | 124 | 146 | 97 | 92 | 68 | 76 | 126 | |||||||
. Butadiene | - | - | 27 | - | 11 | 6 | - | |||||||
. Toluene | - | - | - | - | - | - | - | |||||||
. Fuel | 42 | 59 | 9 | 0 | - | - | 42 | |||||||
. Para-xylene | - | - | - | - | - | 28 | 12 | |||||||
. Ortho-xylene | 9 | 4 | 3 | 8 | 3 | 6 | 8 | |||||||
. Isoprene | 6 | 6 | 4 | 4 | 0 | 0 | 0 | |||||||
. Butene 1 | - | 3 | 3 | - | 2 | - | - | |||||||
. Mixed Xylene | 9 | 6 | 10 | 1 | 9 | 3 | 7 | |||||||
Business Development | ||||||||||||||
. PET | 0 | 1 | 8 | 1 | 1 | 29 | 2 | |||||||
. Caprolactam | 23 | 33 | 18 | 3 | 20 | 12 | 22 | |||||||
Others | 29 | 12 | 53 | 141 | 143 | 209 | 191 | |||||||
Total | 754 | 662 | 594 | 553 | 583 | 760 | 860 |
|
26 |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Date: November 08, 2006
BRASKEM S.A. | |||
By: | /s/ Paul Elie Altit | ||
Name: | Paul Elie Altit | ||
Title: | Chief Financial Officer |