1Q17 RESULTS M AY / 2017

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Transcription:

RESULTS M AY / 2017

Positivo Tecnologia recorded a net revenue of R$453.5 million in, an increase of 20.7% Continuous progress in the diversification of the business, with mobile phones reaching 32.6% of consolidated revenue in (+12.7 p.p.): 98% growth in net revenue in this segment for Market share increased from 3.1%¹ in to 4.6%¹ in (+1.5 p.p.)¹ Digital TV Project: Beginning of deliveries of converters in, with gross revenue of R$73 million Project Expansion with additional batch in the amount of R$41 million, with a total contract of R$308 million Further reduction in recurring general and administrative expenses of 17.5% in, despite high inflation Adjusted EBITDA of R$34.4 million (+16.5%), with margin of 7.6%. In the last 12 months, the Adjusted EBITDA reached R$148.4 million (+62.9%) Good evolution of cash generation projects, with a reduction in excess inventory and monetization of tax credits totaling R$21 million in Net Debt of R$239.3 million, the lowest close for a first quarter in five years, with a Net Debt/Adjusted EBITDA ratio of 1.6x Partnership with the athlete Neymar Jr for the promotion of the Quantum smartphones Change of the Company s corporate name to Positivo Tecnologia S.A., with a broader concept, more up-to-date and aligned with the Company's current business diversification ¹ Source: IT Data All comparisons herein refer to, except where otherwise indicated 2

Section I Market Scenario

400 350 300 250 200 150 100 50-60% 50% 40% 30% 20% 10% 0% -10% -20% Diversification has been the key factor for recovering results and offsetting the economic slowdown MARKET SCENARIO PCs: +13% in ¹ Corporate and Government Segments (+25% in ): Recovery after a long period of contingent investment Expectation of maintaining a double-digit growth rate percentage for the remainder of the year Retail Segment (stable in ): Segment still suffers with the economic situation Upcoming quarters should show some growth in demand Mobile Phones: +30% in ¹ COMPANY ACTIONS - DIVERSIFICATION Growth in Mobile Phones Net Revenue Mobile Phones (R$ MM) 32.6% 19.9% 147.7 +97,6% 74.8 % of consolidated net revenue Growth concentrated in smartphones with intermediate and high configurations Smartphone segments stable, due to the fragile consumption momentum of lower income classes IT Data projects increase of 4% in mobile phone segment, being +8% in smartphones and -31% in feature phones ¹ Source: IT Data Quantum products with 721% revenue growth The new brand already represents over 50% of revenues in mobile phones Digital TV Project Gross revenue of R$73 million in Revenue of R$235 million to be recognized by the end of the year 4

Smartphones continue to increase their market share, representing 99% of the mobile phone market in Brazil Positivo Market Share (Brazil)¹ Total Mobile Phone Market (Smart + Feature) Projection of the PCs and Mobile Phones Markets in Brazil (US$ billion 2017E)² 4.2% 4.7% 4.6% 4.6% 13.1 3.1% 0.8% 1.3% 2.0% 2.4% 3.1 13.3% 4.6% 1Q15 2Q15 3Q15 4Q15 2Q16 3Q16 4Q16 PCs Positivo Market Share¹ Mobile Celulares Phones Positivo Market Share (Brazil)¹ Smartphones Market Positivo Market Share Evolution (Brazil)¹ Feature Phones Market 0.5% 0.6% 0.9% 1.2% 1.6% 2.3% 3.1% 3.4% 3.5% 2.3% 5.8% 26.3% 26.3% 20.8% 18.7% 14.6% 11.7% 12.7% 1Q15 2Q15 3Q15 4Q15 2Q16 3Q16 4Q16 ¹Source: IT DATA (annualized) 1Q15 2Q15 3Q15 4Q15 2Q16 3Q16 4Q16 ²Source: IDC 5

Campaign with athlete Neymar Jr in points of sale, digital media and at main soccer tournaments 6

1 0.9 9 0.9 8 0.9 7 0.9 6 0.9 5 0.9 4 0.9 3 0.9 2 0.9 1 0.9 0.8 9 0.8 8 0.8 7 0.8 6 0.8 5 0.8 4 0.8 3 0.8 2 0.8 1 0.8 0.7 9 0.7 8 0.7 7 0.7 6 0.7 5 0.7 4 0.7 3 0.7 2 0.7 1 0.7 0.6 9 0.6 8 0.6 7 0.6 6 0.6 5 0.6 4 0.6 3 0.6 2 0.6 1 0.6 0.5 9 0.5 8 0.5 7 0.5 6 0.5 5 0.5 4 0.5 3 0.5 2 0.5 1 0.5 0.4 9 0.4 8 0.4 7 0.4 6 0.4 5 0.4 4 0.4 3 0.4 2 0.4 1 0.4 0.3 9 0.3 8 0.3 7 0.3 6 0.3 5 0.3 4 0.3 3 0.3 2 0.3 1 0.3 0.2 9 0.2 8 0.2 7 0.2 6 0.2 5 0.2 4 0.2 3 0.2 2 0.2 1 0.2 0.1 9 0.1 8 0.1 7 0.1 6 0.1 5 0.1 4 0.1 3 0.1 2 0.1 1 0.1 0.0 9 0.0 8 0.0 7 0.0 6 0.0 5 0.0 4 0.0 3 0.0 2 0 0.0 1 20. 0% 18. 0% 16. 0% 14. 0% 12. 0% 10. 0% 8.0 % 6.0 % 4.0 % 2.0 % 0.0 % Profitability indicators and projects with cash generation maintained the good performance in COMPANY ACTIONS PROFITABILITY Close administration on the purchase of inputs to avoid excess inventory and the need for sale discounts Gain in production and post-sales efficiency COMPANY ACTION CASH Cash Flow of Taxes to be Recovered (R$ MM): Actual (year) Actual () Sales Margin (% of Net Revenue)¹ 2015 1Q15 8.3% 5.2% 8.1% 4.8% 8.1% 14.1% 11.8% 11.1% 9.6% (71) 88 2016 (24) 23 21 1Q15 2Q15 3Q15 4Q15 2Q16 3Q16 4Q16 +R$ 159 MM vs. 2015 +R$ 45 MM vs. 1T15 Expressive reduction in fixed costs, even with high inflation General and Administrative Expenses² (R$ million) -45.7% Reduction in excess inventory (R$ million)³: 252-91 MM 20.7-34.2% -17.5% 13.6 11.2 135 83 57 66 62 52 56 44 1Q15 (1)net revenue less COGS adjusted for the hedge, selling expenses and depreciation (2) Excluding the history of R&D expenses, non-recurring items and depreciation effects Sep-15 Dec-15 Mar-16 Jun-16 Sep-16 Dec-16 Jan-17 Feb-17 Mar-17 (3) Excess inventory that exceeds 54 production days, which represents the average time from the entry of materials into inventory to shipment of the finished products 7

Perspectives and Highlights for the Company in 2017 1 Mobile Phones: 4 Computers Government: Strong competition underway in smartphone market Market with the highest rate of bids in progress Search for strength in turnover of products in sales channels, in Positive has a winning rate similar to recent years order to provide sustainable performance throughout the year Revenue will be concentrated in the second half of the year due Quantum expected to be the main growth vehicle in 2017 to the slowness of many agencies in placing orders for the Launching of Quantum MUV UP and Quantum GO2 bidding notices already expired Partnership with Neymar Jr to promote the brand 5 Launching of Medical Equipment 2 Digital TV Project: New batch in the amount of R$41 million, with expected deliveries in the second half of 2017 and 1Q18 This new batch increases the global contract to R$308 million Through a joint venture with Hi Technologies, which had 50% of its capital acquired by the Company in 2016 Main development product in 2017 was approved by ANVISA in April Launchings should occur at the end of 2Q17 3 Computers Retail: Sales have been healthy and well aligned with internal projections, avoiding the generation of excess inventory 6 Change of the Company s corporate name to Positivo Tecnologia: Expectation of maintaining this scenario for the upcoming months New name has a broader concept, more up-to-date and aligned with the Company s current business diversification Approved by 100% of minority shareholders attending the General Shareholders Meeting held in April 8

Section II Financial Results

Smartphone volume grows 86%, driven by Quantum products MOBILE PHONE SALES¹ PCs SALES BY CHANNEL¹ +86.3% 358-18.9% -4.8% 192 197-41.1% 116 136 110 165 157 43.0% 13 19 Smartphones Feature Phones Retail Government Corporate TABLET SALES BY BRAND¹ PCs SALES BY BRAND¹ -18.8% -29.8% 18 +6.3% 19 173 +3.4% 141 140 145 6 4 Positivo Positivo BGH (1) In thousands of units Positivo Positivo BGH Positivo Positivo BGH 10

Consolidated net revenue up 20.7% reaching R$453.5 million, driven by smartphones and the TV Digital project NET REVENUE (R$ MILLION) AVERAGE PRICE¹ (R$) +10.5% 221 245-20.5% +267.7% 2,231 2,548 1,264 1,372 2,904 2,857 2,397-1,6% +0,4% 1,245 1,158 1,162 118 94 110 441 617 361 306 +94,1% 856 30 223 220 281 345 +2,9% 355 Retail Government Corporate 2Q16 3Q16 4Q16 Desktops Notebooks Tablets Telefones Celulares NET REVENUE - BY PRODUCT Notebook 33.8% Others 10.9% Tablet 0.6% Others 15.9% Tablet 0.8% Notebook 23.0% Desktops: -1.6% vs. 4T16: Reflecting the dollar drop, partially compensated by the higher sales proportion of equipment with monitors Notebooks: +0.4% vs. 4T16: Increase of sales in the corporate segment absorbed the dollar drop. Tablets: +94.1% vs. 4T16: Higher share of sales to the corporate market Desktop 34.4% Mobile Phones 20.2% Mobile Phones 33.0% Desktop 27.3% Mobile Phones: +2.9% vs. 4T16: Advances in the share of sales of Quantum smartphones, sold at higher prices than the Positivo brand (1) Considers products sold in the Brazilian market only 11

Adjusted gross margin reached 29.5%, favored by the improved ratio between exchange rate variation and efficiency gains COGS 1 SALES EXPENSES¹ 78.6% 75.4% 71.1% 68.0% 71.5% 15.9% 16.5% 18.9% 19.7% 18.3% 78.2% 71.9% 67.8% 66.2% 70.5% 6.8% 6.3% 8.4% 9.8% 8.2% 4.4% 4.7% 4.7% 4.7% 4.9% 3.7% 4.8% 5.0% 4.4% 5.0% 13% 12% 2Q16 3Q16 4Q16 2Q16 3Q16 4Q16 COGS G&A (R$ MM) COGS Ajusted by the hedge Others Technical Assistance Marketing Sales G&A Expenses 4Q16 Personnal Others Subtotal -before non-recurring, R&D, depreciation Chg. % X Chg. % X 4Q16 (10) (12) (11) 3.3% -8.7% (3) (2) (1) -80.9% -57.2% (14) (13) (11) -17.5% -14.2% (+) Non-recurring items / R&D (7) (10) (11) 60.4% 12.3% (+) Deprec. AndAmortization (3) (5) (4) 5.8% -24.6% Total (24) (27) (26) 7.7% -6.9% COGS adjusted by hedge: Improved pricing and exchange rate ratio. Higher revenue helped dilute fixed plant structures Sales: Growth of marketing line due to increased disbursement with cooperative advertising funds and rebates G&A: reduction of recurring expenses by 17.5% due to lower personnel costs to better suit the administrative structure (1) In % of Net Revenue (2) Refers to amounts received (or paid) by the Company in foreign exchange hedge instruments contracted to cover the dollarized inputs. These amounts are net of the 112 exchange variation on dollar invoices

120.0 100.0 80.0 60.0 40.0 20.0-3.3 x 2.8 x 2.3 x 1.8 x 1.3 x 0.8 x 0.3 x -0.2x Adjusted EBITDA reached R$34.4 million in (+16.5%). Net results affected by non-recurring costs in Argentina and by the recognition of future losses in derivatives ADJUSTED EBITDA¹ (R$ MM) NET PROFIT (LOSS) (R$ MM) 2.7x 1.9x 1.7x 1.5x 1.6x 1T16 1T17 (3) 29.5 45.1 33.0 35.9 34.4 (10) (8) 2Q16 3Q16 4Q16 R$ 5 million in non-recurring costs related to the closure of a joint venture plant in Argentina Adjusted EBITDA Adjusted EBITDA margin (%) FINANCIAL RESULT (R$ MM) Financial Result ADJUSTED EBITDA CONCILIATION (R$ MM) 1T16 1T17 Cash effect of raw material hedging (1) (5) Mark to market and other non-cash items (26) (9) Subtotal Exchange rate Variation (a) (28) (14) Financial revenues 23 18 Financial expenses (33) (36) EBITDA 12 33 (+) Cash Effect of raw material hedging (1) (5) (+) EBITDA Joint Ventures (50%) 19 0 (+) Non-recurring termination expenses in Argentina - 5 Subtotal Cost of debt and others (b) (10) (18) Adjusted EBITDA 30 34 Total (a + b) (38) (31) Adjusted EBITDA margin (%) 7.9 7.6 13 (1) EBITDA adjusted for the cash effect of the foreign exchange hedge on inputs, the addition of 50% of EBITDA from the IFSA joint venture and non-recurring items.

600.0 500.0 400.0 300.0 200.0 100.0-3.0 x 2.5 x 2.0 x 1.5 x 1.0 x 0.5 x 0.0 x -0.5x -1.0x Net debt of R$239 million at the end of, even with the punctual increase of working capital WORKING CAPITAL (R$ MM) NET DEBT (R$ MM) R$ million 4Q16 x 4Q16 x R$ -5,4 million Receivables 253 296 351 55 98 Inventories (-) Suppliers 127 129 123-5 -4 Working Capital 380 424 474 50 95 2.7x 1.9x 1.7x 1.5x 1.6x 244.7 226.2 209.9 220.2 239.3 Cash Cycle (in days) 99 111 104-7 5 2Q16 3Q16 4Q16 Net Debt Net Debt Multiple / Adjusted EBITDA Main effects during the period: - Increase in working capital needs to meet operational growth - Revenue increased by 20.7% vs. and 15.7% vs. 4Q16 - Higher revenues in smartphones and Digital TV Project - Cash cycle improvement of 5 days due to extended payment due date to mobile phone suppliers (2) Includes the balance of financial instruments (3) In % of net revenue of the last 12 months Cash balance on 03/31/2017: R$ 365 million CASH CONVERSION CYCLE (IN DAYS) 1 133 115 96 98 89 81 64 63 57 61 51 67 66 70 61 2Q16 3Q16 4Q16 Accounts Receivable¹ Inventories² Suppliers³ 14

0% Improved fundamentals reflected in the increase of liquidity and share price SHARE PRICE PERFORMANCE POSI3 Indicators Mar - 2017 Base 100 300% POSI3 + 136.6% 250% Closing Price (R$) 3.50 3.50 200% Minimum Price (R$) 2.72 3.20 Maximum Price (R$) 4.48 3.44 150% 100% 50% IBOV + 55.9% POSI3 Appreciation 25.4% -12.9% Ibovespa Appreciation 7.9% -2.5% AVERAGE NUMBER OF DAILY TRADES AVERAGE DAILY VOLUME (R$ 000) +1,470.6% 1,978 +551.6% 803 +261.8% 484 +1,336.1% 970 131 134 126 68 Apr/16 Apr/17 Apr/16 Apr/17 15

Hélio Bruck Rotenberg CEO Lincon Lopes Ferraz Investor Relations Officer Phone: +55 41 3316 7887 Fax: +55 41 3316 7810 E-mail: ir@positivo.com.br http://www.positivotecnologia.com.br/ir Some of the statements expressed herein are based on the Company's current assumptions and perspectives that could cause material variations between results, performance and future events. Actual results, performance and events may differ materially from those expressed or implied by these statements as a result of various factors, including general and economic conditions in Brazil and other countries, interest rates and exchange rates, changes in laws and regulations, and general competitive factors (on a global, regional, or national basis).