COSAN LIMITED Luis
Henrique
Safety
Daily commitment to ZERO ACCIDENT
12.69
11.71
2.01
TRCF
Reportable Accident per million of Hours Worked
3.17
2.14
1.49 1.14 0.75 0.83 0,65
Dez/19
LTIF
Lost time incidents per million of Hours Worked
0.82
0.54
0.34 0.24 0.15 0.11 0.11 0.11
Dez/19
3
Combustíveis
Changing market requirements
Volume recovers despite GDP growth below expectations
New formal competitors
Petrobras divestment process
Higher price volatility
Attractive regional markets
90 days price freezing (Aug/Oct 2019 - ARG)
Segmented B2B management and dealers agenda
Convenience / Proximity acceleration and digital platform
Integrated Logistics and Supply
Continued focus on cost efficiency
Cash optimization through Capex and Opex management
Synergies / Shared Services integration
5
Fuel Demand in Brazil
Significant volume recovery
Fleet vs. Consumption
(% annual)
Fleet
Gasoline Equivalent "Otto Cycle" (m3)
Gasoline avg price (BRL/l)
3.2 3.5 3.6 4.2 4.5
4.6% 3.5% 3.4% 3.8% 4.0%
GDP vs. Diesel Consumption
(% annual)
GDP Brazil
Diesel Variation
3.0%
1.3% 1.6%
0.9% 1.3% 1.1%
-3.5%-3.3%
0.5% -0.9% 0.8%
4.0%
-3.1%
-4.7%-5.1%
2015 | 2016 | 2017 | 2018 | 2019 |
2015 | 2016 | 2017 | 2018 | 2019 |
6
Wide infra-trading footprint in South America
Santarém | Belém |
São Luis |
Pecém
Miritituba
Cabedelo
BRL mln
249
Investiments
(BRL bln) | 1.3 |
1.0
0.8 0.8 0.8
Vitória
infrastructure projects in Brazil
New project | assessment | |
Approved project / new investments | |
Pipelines for Fuels Products | |
Buenos | Logum Pipelines |
Aires | Main Railways for fuels |
Raízen distribution terminals | |
Raízen Mills |
+BRL
1bln
investments in infrastructure in the last 5 years in Brazil
2015 | 2016 | 2017 | 2018 | 2019 |
Excludes M&As
7
Solid and well executed strategy
Selective and profitable growth grounded on long-term relationship with customers
Volume growth | Market share & Volume | Number of Gas Stations | Throughput - Brazil |
vs Brazilian industry | (MM m³) | & C-stores | (m³/month/station) |
Raízen | ANP (ex. Raízen) | SINDICOM (ex. Raízen) | Volume (MM m³) | Market Share(%) | Gas Stations | C-Store | Plural (ex. Raízen) | Raízen |
5% | 19.3% | 19.9% | 20.6% | 20.6% | 21.0% | 7,113 | 7,270 | ||||||
1% | 3% | 2% | 3% | 33.6 | 5,839 | 6,043 | 6,329 | 261 | |||||
-1% | |||||||||||||
27.4 | |||||||||||||
-2% | 25.1 | 24.8 25.6 | |||||||||||
-2% | 240 | ||||||||||||
-2% | |||||||||||||
-4% | -4% | -4% | |||||||||||
249 | 243 | 236 | 247 |
213 | 218 | 217 |
203 | ||
-12% | 951 | 957 | 944 | 1,652 | 1,726 | ||||||||||||||
2015 | 2016 | 2017 | 2018 | 2019 | 2015 | 2016 | 2017 | 2018 | 2019 | 2015 | 2016 | 2017 | 2018 | 2019 | 2015 | 2016 | 2017 | 2018 | 2019 |
Note: (i) Excludes greases, lubricants and LPG. | Note: Follows new methodology for disclosing the total ANP volume | ||||||||||||||||||
(ii) Excluding the 2018 Truck Drivers Strike, volumes grew 3.5% in 2019. |
8
Financial Highlights
Adjusted EBITDA | Cash Generation |
(BRL bln) | (EBITDA Investments) (BRL bln) |
3.7 | 2.3 | |||||
2.0 | 2.1 | |||||
2.8 | 2.9 | 2.9 | 1.8 | |||
2.5 | 1.7 | |||||
2015 | 2016 | 2017 | 2018 | 2019 | 2015 | 2016 | 2017 | 2018 | 2019 |
9
Energia
Focus on improving agricultural productivity and new markets expansion
Sugar price recovery and strong ethanol prices
Transition favoring sustainable products and circular economy
(Renovabio and new dimension for Ethanol worldwide)
Opportunities related to global and local
changes in power/fuel markets
Portfolio optimization to increase profitability
Investment in sugarcane fields and focus on operational efficiency
Strategic outsourcing of sugarcane production
Invest in profitable and renewable projects
Capture opportunities in trading, leveraging storage capacity and power market
11
2019/20 Calling for initial price recovery
Global sugar prices will likely achieve higher levels amid growing expectations of short supply in major producing countries and higher ethanol usage
Sugar - World S&D
15 | Surplus/Deficit | Stock To Use Ratio | 55.0% | |||||||||||
10 | 50.0% | |||||||||||||
45.0% | ||||||||||||||
5 | 40.0% | |||||||||||||
0 | 35.0% | |||||||||||||
30.0% | ||||||||||||||
-5 | ||||||||||||||
-3.8 | ||||||||||||||
Note: * Forecast by Platts | 25.0% | |||||||||||||
-10 | -8.7 | 20.0% | ||||||||||||
2015/16 | 2016/17 | 2017/18 | 2018/19 | 2019/20F 2020/21F* |
Historical Sugar Prices
NY #11 (c$/lb) | NY #11 (R$/lb) | |||
70 | Future Curve |
60
50
40
30
20
10
0
* Platts
12
Raízen Energia Efficiency Focus
Investing to increase agricultural productivity
CAPEX & OPEX | CLT | Cut, Loading & | Planting & Treatment |
(BRL bln real terms) | Transportation | (BRL bln real terms) | |
(BRL/ton | real terms) |
Variable Costs (ex. Third Part Sugarcane) | Fixed Costs | Planting | Land treatment | Planting Area (k há) | ||||
4.6 | 4.8 | 29.7 | 30.9 | 30.8 | 95 | |||||||
4.1 | 4.2 | 4.3 | 26.5 | 27.7 | 81 | 82 | ||||||
63 | 1.3 | |||||||||||
48 | 1.0 | 1.3 | ||||||||||
2.3 | 2.4 | 0.8 | 0.9 | |||||||||
2.2 | 2.2 | 2.3 |
2015/16 2016/17 2017/18 2018/19 LE 19/20 | 2015/16 2016/17 | 2017/18 2018/19 LE 19/20 | 2015/16 2016/17 2017/18 2018/19 LE 19/20 |
Sugarcane Crushed (mIn tons)
- Total production cost per sugar equivalent (¢$/lb)
Real Terms
11.1 11.2 11.2 11.4 11.4
62.7 59.4 61.2 59.7 59.6
2015/16 2016/17 2017/18 2018/19 LE 19/20
Adjusted by:
• | BRL 3.90/Dolar | • | Consecana BRL 0.60/kg ATR |
• | Diesel BRL 2.60/l | • | Adjusted baseline of SG&A |
13
Financial Highlights
EBITDA
Adj. EBITDA (BRL bln)
Adj. EBITDA / Crushed Sugarcane
Adj. EBITDA / Crushed Sugarcane (3 year moving average)
EBIT
Adj. EBIT (BRL bln)
Adj. EBIT / Crushed Sugarcane
Adj. EBIT / Crushed Sugarcane (3 year moving average)
63 | |
48 | |
46 | 53 |
3.7
3.0
67 | 60 | 56 |
59 | 51 | 58 |
4.1
3.0 3,4
32 | 33 | 27 | ||
22 | ||||
18 | ||||
27 | ||||
22 | ||||
16 | 16 | 17 | ||
1.9 | 2.0 | |||
1.1 | 1.0 | 1.0 |
15'16 | 16'17 | 17'18 | 18'19 | LE 19'20 |
15'16 | 16'17 | 17'18 | 18'19 | LE 19'20 |
14
Raízen Combined Results
Consistent financial performance
Adjusted EBITDA | Investments | Cash generation |
(BRL bln) | (BRL bln) | (EBITDA CAPEX) (BRL bln) |
7.7 | 8.0 | 4.2 | 4.4 | 3.8 | 3.9 | ||||
3.2 | 3.6 | ||||||||
7.1 | 3.8 | ||||||||
6.7 | |||||||||
6.1 | 3.2 | 2.9 | |||||||
5.5 | |||||||||
2.9 | 2.3 | ||||||||
2.6 | |||||||||
Dividends
(BRL bln)
3.1 | ||||
2.7 | 2.3 | 2.6 | ||
2.3 | ||||
1.7
15'16 | 16'17 | 17'18 | 18'19 LE 19'20 | 15'16 | 16'17 | 17'18 | 18'19 LE 19'20 | 15'16 | 16'17 | 17'18 | 18'19 LE 19'20 | 15'16 | 16'17 | 17'18 | 18'19 LE 19'20 |
BRL 1bln due to the JV Raízen Conveniências | Excludes M&As |
formation |
16
Guidance
Expansion in all segments combined EBITDA BRL 7.3bln (mid point)
Raízen Energia | Guidance | Raízen Combustíveis | Guidance | |||||
Crop 2020/21 | ||||||||
(jan/20-dec/20) | ||||||||
(apr/20-mar/21) | ||||||||
Crushing Volume | 61,000 | 4,000 | EBITDA (BRL mln) | 3,440 | 3,800 | |||
('000 ton) | ||||||||
EBITDA (BRL mln) | 3,500 | ,900 | Investments (BRL mln) | 1,220 | ,620 | |||
Investments (BRL mln) | 2,850 | 3,050 | |
Notes: None of the guidance considers effects of IFRS 16 implemented on April 1st, 2019. Results expressed in | methodology |
EBITDA: Adjusted by biological assets effects, hedge accounting, asset sales and non recurring effects | |
CAPEX: does not consider M&As | |
Argentina results converted by BRL 4,00/USD |
17
Ricardo | The Journey |
Mussa |
The Journey so Far
Successful 10 years cycle tripling company results with two integrated businesses
Excellence
EBITDA
Distribution
2.3
BRL blnEthanol,
Sugar,
& Bioenergy
#Sites:
4,200 7,270
Market Share:
19% 22%
Real terms
production costs
12.1 11.4 c$/lb
Trading of | |
Double | Renewable & |
C-Stores results | Oil products |
Market entry | 6.8 |
in Argentina | 16.5k m³ |
Headcount | LTI´s |
41K 23K | 230 10 |
in execution
EBITDA
+7.0
BRL bln
19
Global Market Trends...
Growing Demand | Digital | New Consumption | Lower Emission | Distributed Energy |
for Clean Energy | Revolution | Behavior | Cars | Generation |
20
Fuel distribution
Consistent Strategy
Total Volume | Synergies | |||||||||||
Market Share | ||||||||||||
Strong Network / Growth Agenda | BRA x ARG | |||||||||||
(Ethanol and Oil products) | ||||||||||||
21.0% | BRL mln | |||||||||||
20.6% | 20.6% | |||||||||||
Wide infrastructure footprint | 19.9% | |||||||||||
19.3% | 350 | |||||||||||
18.8% | ||||||||||||
17.7% 18.0% | 33.6 | |||||||||||
Most efficient logistics, distribution and | 17.5% | 27.4 | ||||||||||
supply (local vs. imports) | 21.7 | 23.0 | 24.9 | 25.1 | 24.8 | 25.5 | ||||||
20.2 | ||||||||||||
Strong Offer and Execution with | ||||||||||||
150 | ||||||||||||
win-win relationships | ||||||||||||
B2B2C through digital (Shell Box) | ||||||||||||
Projects to increase integrated Refining Margins (ARG) | 2011 | 2012 | 2013 | 2014 | 2015 | 2016 | 2017 | 2018 | 2019 | 2019 | Potential | |
21
CUSTOMER RELATIONSHIP PLATFORM
On & Beyond service stations
- Digital transformation: B2B2C
- ePay and Earn on each refuel
Redeem only at Shell | 660k |
Strategic Partnerships Key Differential | |
(Payly, Mercado Pago, Paypal, Pague Seguro |
70k | MONTHLY EVOLUTION | ||
TRANSACTIONS | |||
Oct-16 | Oct-17 | Oct-18 | Oct-19 |
High utilization frequency
Shell V-Power consumption
2.6x
month
2x
higher
22
Proximity & Convenience
JV with a best-in-class partner
#C-STORES5,000
Brazil
5x
Reference in | Expertise in | Largest retailer | One of largest |
Operation of | Supply chain | in the Americas | groups in |
own stores | and retail | (+20 thousand | Mexico |
Logistics | stores) | (USD 23billion in | |
revenue - 2018) |
1,020
New era of developments
2019Potential
Accelerate Shell Select | Implement / Expand OXXO |
network growth through | Proximity model through |
franchise & own operation |
23
Sugar & Ethanol
In-house knowledge to increase agricultural productivity
Focus on efficiency, namely agricultural operation
Assets (biomass) and mills portfolio optimization
Focus on Energy Efficiency (industrial operations)
Advance in Sugar value chain
Leadership in Renovabio (only integrated company)
TSH
reaching a good
level of profitability | 83 | ||||
71 | ~BRL 800 mln | ||||
incremental profit | |||||
per crop | |||||
19/20 | Historical level |
24
Ethanol and Global Decarbonization
Total Emissions Full cycle
Well to Wheel - gCO2/km
- | 50 | 100 | 150 | 200 | 250 | 300 | 350 |
Brasil E100
Noruega VE
França VE
Canadá VE
Brasil VE
Europa VE
Holanda VE
Alemanha VE
EUA VE
Mundo VE
China VE
Brasil E27 EUA E10
LOWEST EMISSION FUEL
EMISSIONS RELATED TO ENERGY MATRIX
CLEANER GASOLINE IN BRAZIL
Opportunities for Ethanol
- New European Mandate (REDII): 15 bln liters demand for E2G
- Sugar-caneproducing countries to leverage on ethanol production
India Thailand
Car Manufacture | Batteries | Power | Gasoline | Ethanol | ||||
RAÍZEN RENEWABLES
Leverage on energy transition offering solutions to clients
BIOMASS | PROPRIETARY | TRADING | CUSTOMER |
AVAILABILITY | TECHNOLOGIES | ACCESS |
30 MM tons under | E2G, Biogas, | Ethanol, | Distributed |
management | Pellets | Sugar & | Generation & Free |
Power | Market |
26
Biomass Utilization
Stable process
Potential to reduce cost/increase output
Premium for differentiated product
E2G
Only proven commercial scale tech on cellulosic ethanol
Only plant in Brazil
Develop markets abroad (long term contracts)
Integration with mills enabling cost efficiency
BIOGAS
Plenty feedstock
(30 bln liters of vinasse)
Major plant in Brazil
Low implementation and market risk Flexibility to convert to biomethane
PELLET
Tested abroad with good results
27
Ethanol
Proximity Sugar
Distribution Convenience Bioenergy
28
Attachments
- Original document
- Permalink
Disclaimer
Cosan Limited published this content on 09 March 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 09 March 2020 13:47:14 UTC