Santos Brasil announces record net income of R$89.0 million in 3Q10

08/11/2011

Santos Brasil's consolidated net income totaled R$89 million in 3Q11, versus R$48.7 million in 3Q10, while year-to-date net income came to R$172 million. This result mostly reflects the Company's more robust operations and the market share gain in Tecon Santos, in addition to the merger of Tecon Santos, which is Santos Brasil largest terminal, into Santos Brasil Participações S.A., which brought tax benefits.

According to Marcos Tourinho, Santos Brasil Investor Relations Officer, Tecon Santos has posted consecutive records in terms of operational efficiency, with ship productivity averaging 80.67 movements per hour (MPH) in October. The terminal's operational efficiency is similar to those of the world's leading terminals. In January, the terminal's productivity came to 58.05 MPH. The annual target of 70 MPH was achieved in May and 3Q11 productivity came to 78 MPH.

Santos Brasil recorded EBITDA (operating income before interest, taxes, depreciation and amortization) of R$117.5 million, 16.5% up year-on-year. The EBITDA margin came to 41.1% and recurring EBITDA, which does not consider expenses with provisions for non-recurring items, was R$121.3 million, accompanied by a margin of 42.4%, 20.2% up on 3Q10. In the first nine months of 2011, EBITDA totaled R$335.8 million, with margin of 41.2%.

Net revenue amounted to R$285.9 million in 3Q11, corresponding to an expansion of 17% over the same period a year earlier, while year-to-date growth came to 34.6%.

Consolidated gross revenue increased by 16.6% compared to 2010, fueled by the higher number of vehicles handled by the vehicle terminal (TEV), chiefly in exports.  In 9M11, gross revenue climbed by 35.2% year-on-year.

In the first nine months, gross revenue from port terminals grew by 34.1%, to R$728.2 million.

Revenue from logistics operations grew by 14% in 3Q11 over the same period last year, due to the Company's efforts to improve port-to-door logistics services.

CAPEX

Santos Brasil invested R$160.9 million in 9M11. The Company increased its annual investment guidance from R$187.1 million to R$199.5 million, to reflect the acquisition of a site in the port area in Santa Catarina which will be used as a support area for Tecon Imbituba's operations. Investments totaled R$59.3 million in 3Q11, with the highest share (R$40.3 million, or 68% of total 3Q11 investments) allocated to the conclusion of the expansion works and operational improvements in Tecon Imbituba, which as of 2012 will probably be consolidated as the logistics alternative for Brazil's South region.

The Company's investments in Tecon Santos' infrastructure, modernization of equipment and staff training totaled R$41.6 million, 184.6% more than the R$14.6 invested in the previous year.  These investments prepared the terminal to absorb more substantial volumes, basically due to the future conclusion of dredging, in addition to the possibility of the Port of Santos receiving large vessels as of 2012.

Operating Indicators

Year-to-date handled volume grew by 10.4% over 9M10 to 733,918 containers. In 3Q11, handled volume totaled 268,535 containers, 76% of which full. The volume stored at Santos Brasil's Port Terminals reached 41,362 containers in the same period.  In the logistics segment, the number of containers stored came to 19,438.

The significantly higher productivity and operational efficiency contributed to the market share gain in the Port of Santos, which moved up from 51% to 53% in 9M11 versus 9M10, according to the São Paulo Port Authority (CODESP). The higher market share also influenced the 11% expansion in bonded warehouse operations in 2011.