iochpe-maxion - 2q09 presentation

2Q09 EARNINGS RELEASE

August 2009

2

4T08 / 20082Q09 Earnings Release

The material contained in this presentation is general background information about Iochpe-Maxion S.A. (Iochpe)

as of the date of the presentation. It is information in summary form and does not purport to be complete. It is

not intended to be relied upon as advice to potential investors. No representation or warranty, express or

implied, is made concerning, and no reliance should be placed on, the accuracy, fairness, or completeness of the

information presented herein.

This presentation contains statements that are forward-looking within the meaning of Section 27A of the U.S.

Securities Act of 1933 and Section 21E of the U.S. 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 Iochpe 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.

Although Iochpe believes that the expectations and assumptions reflected in the forward-looking statements are

reasonably based on information currently available to Iochpe management, Iochpe cannot guarantee future

results or events. Iochpe expressly disclaims a duty to update any of the forward-looking statement.

This presentation does not constitute an offer, or invitation, or solicitation of an offer, to subscribe for or

purchase any securities. Neither this presentation nor anything contained herein shall form the basis of any

contract or commitment whatsoever.

3


SIMPLIFIED CORPORATE STRUCTURESIMPLIFIED CORPORATE STRUCTURE

50% 100%

IochpeIochpe--Maxion S.A.Maxion S.A.

100%

Wheels and Chassis DivisionWheels and Chassis DivisionAmstedAmsted--Maxion FundiMaxion Fundiçção e ão e

Equipamentos FerroviEquipamentos Ferroviáários S.A.rios S.A.Automotive Components Automotive Components

DivisionDivision

� Net Operating Revenue in 2Q09 –

R$ 47.9 million

� 17.2% of Consolidated Net

Operating Revenue in 2Q09


R$ 32.1 million




R$ 199.3 million



4


� Consolidated net operating revenue of R$ 279.3 million in the 2Q09, a reduction of 36.8% over the same period of last year

� EBITDA(*) of R$ 19.8 million in the 2Q09, a reduction of 72.1% when compared to the same period of last year

� Net income of R$ 4.6 million in the 2Q09, a reduction of 89.5% when compared to the same period of last year

� Net bank debt of R$ 206.9 million (R$ 198.6 million in June 08), or 1,1x LTM EBITDA* (0,9x in June 08)

HIGHLIGHTSHIGHLIGHTS

(*) EBITDA, throughout this presentation means: net income plus income tax and social contribution, pl us non-operating result, plus net financial expenses, plus depreciation and amort ization, plus goodwill amortization.

5


MAIN DRIVERSMAIN DRIVERS

� Reduction of Brazilian production of trucks, buses and agricultural machinery

� Reduction of domestic demand for railway freight cars

� Reduction of exports

Industry Performance

7


406

459

231201

121108

2007 2008 1H08 1H09 2Q08 2Q09

Source: Anfavea

144

122

63

32 33

18

2007 2008 1H08 1H09 2Q08 2Q09

� ∆ 2Q09 – 08 = -11.2%

� ∆ 1H09 – 08 = -12.6%

� CAGR 2005 – 08 = 7.0%

LIGHT COMMERCIALS – BRAZIL (‘000 units)LIGHT COMMERCIALS – BRAZIL (‘000 units)

Production Export

� ∆ 2Q09 – 08 = -45.9%

� ∆ 1H09 – 08 = -49.6%

� CAGR 2005 – 08 = -7.9%

8


137

167

79

54

42

29

2007 2008 1H08 1H09 2Q08 2Q09

Source: Anfavea

4139

19

6

10

3

2007 2008 1H08 1H09 2Q08 2Q09

TRUCKS – BRAZIL (‘000 units)TRUCKS – BRAZIL (‘000 units)

Production Export

� ∆ 2Q09 – 08 = -31.6%

� ∆ 1H09 – 08 = -32.4%

� CAGR 2005 – 08 = 12.6%

� ∆ 2Q09 – 08 = -71.8%

� ∆ 1H09 – 08 = -67.5%

� CAGR 2005 – 08 = 0.9%

9


39

44

23

1613

8

2007 2008 1H08 1H09 2Q08 2Q09

Source: Anfavea

1516

7

4 4

2

2007 2008 1H08 1H09 2Q08 2Q09

BUSES – BRAZIL (‘000 units)BUSES – BRAZIL (‘000 units)

Production Export

� ∆ 2Q09 – 08 = -34.5%

� ∆ 1H09 – 08 = -30.0%

� CAGR 2005 – 08 = 7.9%

� ∆ 2Q09 – 08 = -39.0%

� ∆ 1H09 – 08 = -39.9%

� CAGR 2005 – 08 = -5.6%

10


65

85

40

28

21

14

2007 2008 1H08 1H09 2Q08 2Q09

Source: Anfavea

27

30

15

78

3

2007 2008 1H08 1H09 2Q08 2Q09

AGRICULTURAL MACHINERY – BRAZIL (‘000 units)AGRICULTURAL MACHINERY – BRAZIL (‘000 units)

Production Export

� ∆ 2Q09 – 08 = -34.1%

� ∆ 1H09 – 08 = -28.8%

� CAGR 2005 – 08 = 17.1%

� ∆ 2Q09 – 08 = -59.0%

� ∆ 1H09 – 08 = -50.4%

� CAGR 2005 – 08 = -1.1%

11


2,3882,546

1,3601,192

727 655

2007 2008 1H08 1H09 2Q08 2Q09

Source: Anfavea

588558

292

157 153

89

2007 2008 1H08 1H09 2Q08 2Q09

Production Export

PASSENGER CARS – BRAZIL (‘000 units)PASSENGER CARS – BRAZIL (‘000 units)

� ∆ 2Q09 – 08 = -10.0%

� ∆ 1H09 – 08 = -12.3%

� CAGR 2005 – 08 = 8.5%

� ∆ 2Q09 – 08 = -42.2%

� ∆ 1H09 – 08 = -46.3%

� CAGR 2005 – 08 = -6.5%

12


1,249

5,118

2,692

734

1,439

376

2007 2008 1H08 1H09 2Q08 2Q09

Sales

Sales

� ∆ 2Q09 – 08 = -73.9%

� ∆ 1H09 – 08 = -72.7%

� CAGR 2005 – 08 = -11.0%

RAILWAY FREIGHT CARS – BRAZIL (units)RAILWAY FREIGHT CARS – BRAZIL (units)

Source: Amsted Maxion estimate

13


64% 69%

31%36%

2Q08 2Q09

OthersMaxion

65% 57%

43%35%

2Q09 2Q08

OthersMaxion

97%77%

23%3%

2Q09 2Q08

OthersMaxion

80% 80%

20%20%

2Q09 2Q08

OthersMaxion

MARKET SHARE – BRAZIL MARKET SHARE – BRAZIL

ChassisChassis

Commercial Vehicles Commercial Vehicles WheelsWheels

Railway Freight Railway Freight CarsCars

Railway CastingsRailway Castings

Source: Iochpe-Maxion estimate

Financial and Operating Performance

15


896

1,216

537418

278 199

115

119

6458

33

279

493

241

95

132

32 48

2007 2008 1H08 1H09 2Q08 2Q09

Wheels & Chassis Automotive Comp. Amsted-Maxion

1.289

1.828

843

570

442

279

� Net Operating Revenue: ∆ 2Q09 – 08 = -36.8%

∆ 1H09 – 08 = -32.4%

� Wheels & Chassis: ∆ 2Q09 – 08 = -28.2%

∆ 1H09 – 08 = -22.2%

� Automotive Comp.: ∆ 2Q09 – 08 = -2.3%

∆ 1H09 – 08 = -10.3%

� Amsted Maxion: ∆ 2Q09 – 08 = -63.6%

∆ 1H09 – 08 = -60.8%

1,056

1,556

737489 391 489

233

272

106

8151

81

2007 2008 1H08 1H09 2Q08 2Q09

Domestic Export

1.289

1.828

843

570

442

279

� Domestic: ∆ 2Q09 – 08 = -38.0%

∆ 1H09 – 08 = -33.6%

� Export: ∆ 2Q09 – 08 = -28.2%

∆ 1H09 – 08 = -23.7%

NET OPERATING REVENUE (R$ million)NET OPERATING REVENUE (R$ million)

16


ALL1%

Ford4%Scania

4%

GMB5%

Others14%

Daimler12%

Tractors7%

Vale11%

Fiat4%

VW16%

MRS10%

Export11%

Caterpillar1%

Tractors5% Scania

2%

Daimler14%

ALL4%Others

9%

Vale6%

GMB9%

Ford6%

Fiat7%

VW23%

MRS1%

Export13%

Caterpillar1%

NET OPERATING REVENUENET OPERATING REVENUE

Revenue by Customer – 2Q08 Revenue by Customer – 2Q09

17


� Exports: ∆ 2Q09 – 08 = -28.2%

∆ 1H09 – 08 = -23.7%

� Wheels & Chassis: ∆ 2Q09 – 08 = -21.1%

∆ 1H09 – 08 = -22.2%

� Automotive Comp.: ∆ 2Q09 – 08 = 4.7%

∆ 1H09 – 08 = -42.0%

� Amsted Maxion: ∆ 2Q09 – 08 = -37.9%

∆ 1H09 – 08 = -25.9%

107

150

65 5129 23

124

121

40

30

22140 0

0 1

1

1

2007 2008 1H08 1H09 2Q08 2Q09


233

272

106

81

51

3756

81

3923

64

64

24

1413

18 11 0

0 0

0

1

1

7

2007 2008 1H08 1H09 2Q09 2Q08


120

146

63

37 31

18

R$ million US$ million

� Exports: ∆ 2Q09 – 08 = -41.9%

∆ 1H09 – 08 = -41.1%

� Wheels & Chassis : ∆ 2Q09 – 08 = -36.4%

∆ 1H09 – 08 = -39.9%

� Automotive Comp.: ∆ 2Q09 – 08 = -15.1%

∆ 1H09 – 08 = -53.0%

� Amsted Maxion: ∆ 2Q09 – 08 = -49.5%

∆ 1H09 – 08 = -42.8%

EXPORTSEXPORTS

18


75

170

90

357

34

236219

13%20%

18% 18% 20% 20%

12%

2006 2007 2008 1H08 1H09 2Q08 2Q09

Gross Profit % NOR

Gross Profit

� ∆ 2Q09 – 08 = -61.8%

� ∆ 1H09 – 08 = -56.0%

� CAGR 2006 – 08 = 27.7%

GROSS PROFIT (R$ million)GROSS PROFIT (R$ million)

19


126136

10

232

63

115

24

3%

14%

13%10%11%

14%

4%

2006 2007 2008 1H08* 1H09 2Q08* 2Q09

EBIT % NOR

EBIT

� ∆ 2Q09 – 08 = -84.8%

� ∆ 1H09 – 08 = -79.0%

� CAGR 2006 – 08 = 30.6%

EARNINGS BEFORE INCOME TAX – EBIT (R$ million)EARNINGS BEFORE INCOME TAX – EBIT (R$ million)

(*) In compliance with Instruction 539/08 of CVM (Brazil’s securities commission) of March 14, 2008 and guidance of the Accounting Pronouncement Committee, Iochpe-Maxion incorporated the amounts accounted as non-operating expenses in 2008 into operating expenses, therefore reducing EBIT presented in the 2Q08 presentation

20


163

20

45

131

71

268

156

8%

16%

13% 12%15%

16%

7%

2006 2007 2008 1H08** 1H09 2Q08** 2Q09

EBITDA % NOR

EBITDA* (R$ million) EBITDA* (R$ million)

EBITDA

� ∆ 2Q09 – 08 = -72.1%

� ∆ 1H09 – 08 = -65.7%

� CAGR 2006 – 08 = 28.2%

(*) EBITDA, throughout this presentation means: net income plus income tax and social contribution, plus non-operating result, plus net financial expenses, plus depreciation and amortization, plus goodwill amortization

(**) In compliance with Instruction 539/08 of CVM (Brazil’s securities commission) of March 14, 2008 and guidance of the Accounting Pronouncement Committee, Iochpe-Maxion incorporated the amounts accounted as non-operating expenses in 2008 into operating expenses, therefore reducing EBIT presented in the 2Q08 presentation

21


-6

21

10

28

-6-8

10

-2%-1%

2%

1%

2%

-1%

2%

2006 2007 2008 1H08 1H09 2Q08 2Q09

Financial Expenses % NOR

Net Financial Expenses

� ∆ 2Q09 – 08 = 3.7%

� ∆ 1H09 – 08 = -228.5%

� CAGR 2006 – 08 = 15.5%

NET FINANCIAL EXPENSES (R$ million)NET FINANCIAL EXPENSES (R$ million)

22


� Impact of the FX rate variation on Equity

� If the operations would expire on 06/30/2009 (at FX rate of R$ 1.9487) , it would represent a negative result of R$ 0.8

million (R$ 0.5 million, net of taxes)

� At the end of 2Q09, the Equity had a positive adjustment of R$ 8.8 million, due to the market value of the non deliverable

forward operations to expire (negative adjustment of R$ 0.5 million, net of taxes) and the FX rate variation of the foreign

investments (positive adjustment of R$ 9.3 million)

IMPACT OF THE FX RATE VARIATIONIMPACT OF THE FX RATE VARIATION

� Impact of the FX rate variation on Financial Expense (Revenue)

(*) provision for NDFs related to selling future dollar that at the end of the quarter had no forecasted exports shipment for the subsequent months

2Q09

BalanceValue

US$ millionImpact R$ MM

NDF Expired 20.0 3.9 NDF to Expire* 4.4 (0.2)

Financial Exp./Rev. 3.8

Period OperationsContracted Value

US$Average FX

RateGain/Loss

R$ thousand

At the end of 2Q09

NDFs (selling) to expire

12,500 1.9541 756

23


78

1

44

5

5872

214

0%

10%

2%

5%6%

12%

9%

2006 2007 2008 1H08 1H09 2Q08 2Q09

Net Income % NOR

76

76

133

Net Income

� ∆ 2Q09 – 08 = -89.5%

� ∆ 1Q09 – 08 = -98.1%

� CAGR 2006 – 08 = 92.1%

NET INCOME (R$ million)NET INCOME (R$ million)

24


132 128

256

188199

207

0.80.8

1.1

0.90.8

1.0

2006 2007 2008 1Q09 2Q08 2Q09

Net Debt x EBITDA*

� To better understand the evolution of net bank debt, it’s worth to mention the R$ 79.2 million dividends (related

to 2008) payment during the 2Q08

NET BANK DEBT (R$ million)NET BANK DEBT (R$ million)


LTM EBITDA

25


Others19%

BNDES-EXIM43%

Working Capital

9%

Import11%ACC

18%

TJLP45%

Others2%

YUAN11%

Dólar42%

162

- -

8438

207245

Short Term Long Term Total Debt Cash Net Debt

(*) Consider the CDI of Jun/09 (0,75% per month)

Indexation Average Cost

Indexed in R$ 116% CDI*

Indexed in US$ 6,47% per year

INDEBTEDNESS – JUN/08 (R$ million)INDEBTEDNESS – JUN/08 (R$ million)

Debt by Lines

Debt Indexation

26


68

113

84

28

10

68

2005 2006 2007 2008 2Q08 2Q09

CAPEX (R$ million)CAPEX (R$ million)

27


SUBSEQUENT EVENT – OPERATIONAL REORGANIZATIONSUBSEQUENT EVENT – OPERATIONAL REORGANIZATION

� Amsted-Maxion, decided to stop its activities on the plant located in the city of Osasco, São Paulo state, in order to adequate its operational structure to the current railway business scenario

� With this measure, all of Amsted-Maxion casting operations are concentrated on the plant located in the city of Cruzeiro, which is dedicated to produce industrials and railway castings. The operations of railway freight cars

assembly remain on the Hortolândia plant

� Amsted Maxion understand that this measure don’t reduce its capacity to supply the market demand of railway equipments

28


SUBSEQUENT EVENT - AQUISITIONSUBSEQUENT EVENT - AQUISITION

� Acquisition of the Wheels business (“Business”) of ArvinMeritor in Brazil, Mexico and United States for approximately US$ 180 million

� The Business produces Fumagalli ™ steel wheels for passenger cars, pick-up trucks, sport utility and light and medium commercial vehicles

� The Business comprises:

� The Brazilian wheels plant in the city of Limeira, São Paulo state, with capacity to produce around 14 million wheels per year and approximately 800 employees

� The Mexican wheels plant in the city of San Luis Potosí, with capacity to produce around 6 million wheels per year and approximately 400 employees

� Customer support office (sales, engineering, quality, logistics and finance) for North American Business, located in Troy, Michigan, United States, with approximately 20 employees and 3 leased warehouses

� The Business has reached, between October 2007 and September 2008 (last fiscal year of ArvinMeritor), net revenues of approximately US$ 325 million

� The acquisition shall be submitted to the relevant anti-trust authorities in each of the countries involved in the transaction in accordance with the applicable laws and legislation

� The acquisition shall also be submitted for approval by the Company’s shareholders in accordance with article 256 of Brazilian Federal Law 6.404/76 by means of a general shareholders meeting to be called eventually.

� The Company will keep its shareholders and the market in general appraised with respect to the conclusion of the acquisition and to occasional withdrawal rights deriving thereto, in accordance with the above mentioned article 256 of Brazilian Federal Law 6.404/76

29


GROWTH STRATEGY – RECENT EVOLUTIONGROWTH STRATEGY – RECENT EVOLUTION

Organic Growth

� The probable economic recovery in Brazil as of the end of 2009 and other regions of

the world as of second half of 2010, brings a potential for organic recovery on the sectors

where Iochpe-Maxion operates

By Products

� Development of product lines that have in its production process, similar technologies

to those dominated by Iochpe-Maxion

� February 2009: Agreement with Fiat, through Automotive Components Division, to

develop new structural stamped components for two new passenger car models

Internationalization

� Grow internationally through the development of plants abroad

� July 2008: Opening of the China wheel plant

� March 2009: Agreement with Daimler, through Wheels and Chassis Division, for the

supply of chassis for a family of light duty commercial vehicles, planned to be launched in

India

Acquisitions

� Accelerate the growth through accretive acquisitions

� August 2009: Acquisition of the Wheels business (“Business”) of ArvinMeritor in

Brazil, Mexico and United States

Additional Information

31


-45.49%

-20.84%

-80.00%

-70.00%

-60.00%

-50.00%

-40.00%

-30.00%

-20.00%

-10.00%

0.00%

10.00%

20.00%

Jul-08 Aug-08 Sep-08 Oct-08 Nov-08 Dec-08 Jan-09 Feb-09 Mar-09 Apr-09 May-09 Jun-09

MYPK3 IBOVESPA

SHARES PERFORMANCE - LTMSHARES PERFORMANCE - LTM

32


Average Daily Trade Volume - LTM

1,632

2,294

1,164

1,987

1,543

685 734

2,885

2,047

1,761

2,142

1,419

124

190

129132

75

38

77

105

91

146

221

106

Jul-08 Aug-08 Sep-08 Oct-08 Nov-08 Dec-08 Jan-09 Feb-09 Mar-09 Apr-09 May-09 Jun-09

Volume Trades

AVERAGE DAILY TRADE VOLUME – R$ thousandAVERAGE DAILY TRADE VOLUME – R$ thousand

33


Shareholders Structure on 06/30/2009

SharesON

Ioschpe Family 13,196,020 27.82%

BNDES Participações 11,593,401 24.44%

Controlling Shareholders 24,789,421 52.26%

BNY Mellon ARX Invest. Ltda 2,837,194 5.98%

Credit Suisse Hedging-Griffo Corr. Valores S.A 3,065,447 6.46%

Others 16,739,624 35.29%

Total Iochpe-Maxion 47,431,686 100.00%

Shareholders %

SHAREHOLDERS STRUCTURESHAREHOLDERS STRUCTURE

34


INCOME STATEMENT (R$ thousand)INCOME STATEMENT (R$ thousand)


(**) In compliance with Instruction 539/08 of CVM (Brazil’s securities commission) of March 14, 2008 and guidance of the Accounting Pronouncement Committee, Iochpe-Maxion incorporated the amounts accounted as non-operating expenses in 2008 into operating expenses, therefore reducing EBIT presented in the 2Q08 presentation

Income Statement - R$ thousand 2Q09 2Q08* Var. 1H09 1H08* Var.

Net Operating Revenue 279,310 442,120 -36.8% 569,955 842,730 -32.4%

Cost of Goods SoldRaw Material (143,578) (231,540) -38.0% (287,802) (442,138) -34.9%

Labor (41,770) (70,314) -40.6% (100,512) (132,516) -24.2%

Others (59,650) (50,340) 18.5% (106,994) (98,570) 8.5%

(244,998) (352,194) -30.4% (495,308) (673,224) -26.4%

Gross Profit 34,312 89,926 -61.8% 74,647 169,506 -56.0%

12.3% 20.3% 13.1% 20.1%Operating Expenses

General and Administrative (12,624) (12,110) 4.2% (25,003) (23,902) 4.6%

Commercial (13,459) (15,259) -11.8% (25,838) (30,411) -15.0%

Others 1,296 42 2956.2% 244 (651) -137.6%

(24,787) (27,326) -9.3% (50,597) (54,963) -7.9%

Operating Income (EBIT) 9,525 62,599 -84.8% 24,051 114,542 -79.0%

3.4% 14.2% 4.2% 13.6%Financial Results

Financial Revenue 25,086 17,233 45.6% 31,340 26,512 18.2%

Financial Expenses (19,037) (11,402) 67.0% (41,320) (18,746) 120.4%

6,049 5,831 3.7% (9,980) 7,766 -228.5%

Earnings After Financial Income 15,574 68,430 -77.2% 14,070 122,308 -88.5%

Income Taxes (10,955) (24,340) -55.0% (12,620) (44,085) -71.4%

Net Income (Loss) 4,619 44,090 -89.5% 1,450 78,223 -98.1%

1.7% 10.0% 0.3% 9.3%

EBITDA 19,821 71,087 -72.1% 45,013 131,080 -65.7%

7.1% 16.1% 7.9% 15.6%

35


BALANCE SHEET (R$ thousand)BALANCE SHEET (R$ thousand)

ASSETS LIABILITIESJun-09 Mar-09 Jun-09 Mar-09

CURRENT CURRENTCash 38,351 99,812 Loans 161,591 191,047 Receivables 156,202 182,733 Payables 59,746 53,394 Inventory 179,620 205,174 Taxes 7,004 12,337 Recoverable Taxes 9,317 10,270 Wage & Salaries 33,591 29,563 Deferred Taxes 17,900 16,975 Customers Advance 10,852 20,052 Antecipated Expenses 1,718 2,283 Dividends - 79,214 Other Receivables 8,272 8,488 Other Payables 21,417 25,635

Payable Financial Instruments 599 16,443

411,380 525,735 294,800 427,685

LONG TERM LONG TERMReceivable 583 593 Loans 83,626 96,810 Recoverable Taxes 16,772 16,934 Provisions 60,059 59,239 Deferred Taxes 82,646 92,671 Others 9,291 8,356 Obligatory deposits and judicial 12,890 12,892 152,976 164,405 Other Receivables 1,852 1,883

114,743 124,973 MINORITY - -

PERMANENT EQUITYInvestments 310 397 Capital 261,463 261,463 Plants, Property and Equipment 368,203 379,605 Profit Reserves 185,408 180,788 Intangible 4,826 6,084 Equity Adjustment 8,843 7,101 Deferred Items 4,028 4,649

377,367 390,734 455,714 449,352

TOTAL ASSETS 903,490 1,041,442 TOTAL LIABILITIES 903,490 1,041,442

2Q09 EARNINGS RELEASE

August 2009

iochpe-maxion - 2q09 presentation

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