Earnings Release
WEG announces 2010 first quarter results
„ Gross Revenues 11% lower than Q1 2009
„ EBITDA of R$ 182 million, stable year-on-year
„ Net Income of R$ 119 million, for 12.8% net margin
Jaraguá do Sul (SC), April 28th, 2010: WEG S.A. (Bovespa: WEGE3), one of the largest
manufacturers of electric motors and related equipment in the world, announced today its results for
the first quarter of 2010 (Q1 2010). The following financial and operating data are, except when
otherwise indicated, presented in a consolidated basis, in thousands of Brazilian Reais (R$) according
to the general accepted accounting principles in Brazil (BRGAAP) and as put forward by the Brazilian
applicable laws. All growth rates and other comparisons, except when otherwise indicated, relate to
the same period of the previous year.
Q1 2010
Highlights
„ Gross Operating Revenues in the first quarter of 2010 reached R$ 1,131.5
million, 11.0% lower year-on-year and 13.4% lower quarter-on-quarter. Net
Operating Revenues totaled R$ 931.9 million, 11.1% lower year-on-year
and 13.5% lower quarter on quarter;
„ Domestic market’s gross revenues were stable compared to the previous
year, while the external markets’ gross revenues declined 29.5% when
measured in Brazilian Reais. When measured in average US dollars, external
markets’ gross revenues declined by 10.6% in relation to Q1 2009;
„ EBITDA reached R$ 181.7 million, stable in relation to Q1 2009 but
declining 20.5% in relation to the previous quarter. EBITDA margin stood at
19.5%, 2.2 percentage points higher than Q1 2009, but 1.7 percentage
points lower than the previous quarter;
„ Net Income of R$ 119.1 million was 2.6% lower year-on-year and 12.7%
lower quarter-on-quarter. The Net Margin was 12.8% for the quarter and
annualized Return on Equity (ROE) reached 20.2%;
„ Investments on fixed assets amounted to R$ 61.4 million during this first
quarter of 2010, of which 44% were allocated to industrial plants in Brazil
and 56% to assets abroad.
Conference Calls
In Portuguese
th
April 29 , Thursday, 9 a.m. (Brasília)
(11) 4688-6301
In English
April 29th, Thursday, 11 a.m. (Brasília)
- from Brazil: (11) 4688-6301
- from other Countries: 1-786-924-6977
Comments from Alidor Lueders,
WEG’s Investor Relations Officer
The development of business in the first quarter of 2010 confirmed our expectations that, we would
observe a gradual recovery of the markets in overcoming the serious financial crisis of 2008 and
2009.
This recovery occurs at different pace in the different segments where WEG does business. Overall,
the economic dynamism is spreading from the Brazilian consumer towards the other segments, which
are, little by little, showing more clearly the resumption of sales growth:
„ The end of the tax reduction incentives on white goods purchases, at the end of last January,
showed that the economic dynamism of the consumer-linked sectors is based on strong
economic fundamentals, such as rising disposable income and credit expansion;
„ The recovery in demand for our products is clearer or more intense the more connected to the
Brazilian consumer is the production of the industrial sector that is our client. The economic
dynamism is irradiating and has already reached the capital goods segments that are more linked
to increasing consumer goods’ productive capacity;
„ In the long-cycle products, such as more elaborate automation systems of industrial processes,
and systems for generation, transmission and distribution, the recovery is in its early stages.
Outside Brazil the recovery also displays variability in terms of the regions where we operate. The socalled emerging countries of Latin America and Asia continue to show stronger and clearer recovery
than the mature economies of Europe and North America. Our growth strategy, which has focused on
expanding our presence in Asia, especially China and India, has been correct in this environment. The
revenue performance in external markets was again hampered by the Brazilian currency appreciation
of 27% over the past 12 months.
With the recovery of markets we are gradually accelerating our capital expenditures program.
Investments in the quarter reached R $ 61.4 million, with an emphasis on the new high voltage electric
motors and generators plant in India, which will come into operation during the second half of 2010.
Finally, we stress that the economic recovery has positive impacts in the prices of Brazilian securities,
including those issued by WEG. Over the past 12 months WEG’s shares had a 63% nominal
increase, or 67% increase if dividends declared during the period were considered."
Main Highlights
Gross Operating Revenue
Domestic Market
External Markets
External Markets in US$
Net Operating Revenue
Gross Operating Profit
Gross Margin
Quarterly Net Income
Net Margin
EBITDA
EBITDA Margin
Q1 2010
1,131,546
Q4 2009 Growth %
1,306,913
-13.4%
Q1 2009 Growth %
1,270,984 -11.0%
801,299
330,247
871,619
435,299
-8.1%
-24.1%
802,351
468,632
-0.1%
-29.5%
181,170
931,907
307,454
250,328
1,076,969
344,226
-27.6%
-13.5%
-10.7%
202,726
1,048,241
311,954
-10.6%
-11.1%
-1.4%
-12.7%
122,193
33.0%
32.0%
119,074
136,426
12.8%
12.7%
181,750
228,548
19.5%
21.2%
29.8%
-2.6%
11.7%
-20.5%
181,112
0.4%
17.3%
Figures in R$ Thousands
2 | WEG S.A. | 1st Quarter 2010 Results
Gross
Operating
Revenues
Gross Operating Revenues came to R$ 1,131.5 million during the first quarter
of 2010 (Q1 2010), 11.0% lower than the first quarter of 2009 (Q1 2009) and
13.4% lower than the fourth quarter of 2009 (Q4 2009). The decline of 11% in
Gross Operating Revenues break down as follows:
„ Decline of 4% as a result of the changes in mix of products sold, volumes
and selling prices;
„ Decline of 7% due to the 26.8% appreciation of the average exchange rate
(Brazilian Real against U.S. Dollar) during Q1 2010 compared to the same
period of 2009.
According to the destination market, Gross Operating Revenues break down as
follows:
„ Domestic Market: R$ 801.3 million, representing 71% of Gross Operating
Revenues, stable in relation to Q1 2009 and 8.1% higher than in Q4 2009;
„ External Markets: R$ 330.3 million, representing 29% of Gross Operating
Revenues, 29.5% lower than in the Q1 2009 and 24.1% lower than Q4
2009. Considering revenues measured in U.S. Dollars, using average
exchange rates for the conversion, Gross Operating Revenues fell 10.6%
when compared to the Q1 2009 and 27.6% when compared to the Q4
2009.
Gross Revenues per Market (R$ million)
External Market
Domestic Market
1.250
1.283
1.307
37%
35%
31%
33%
63%
65%
69%
67%
71%
Q1 09
Q2 09
Q3 09
Q4 09
Q1 10
1.271
1.132
29%
Evolution and Distribution of Consolidated Gross
Revenues per Geographic Market (R$ Million)
Gross Operating Revenues
- Domestic Market
- External Markets
In US$
North America
South and Central America
Europe
Africa
Australasia
Q1 2010
1,131.5
801.3
330.2
Q4 2009
1,306.9
871.6
435.3
Change
-13.4%
-8.1%
-24.1%
Q1 2009
1,271.0
802.4
468.6
Change
-11.0%
-0.1%
-29.5%
181.2
250.3
-27.6%
202.7
-10.6%
35%
19%
30%
8%
9%
33%
15%
24%
5%
23%
1 pp
3 pp
6 pp
2 pp
-14 pp
27%
15%
30%
14%
14%
8 pp
4 pp
0 pp
-6 pp
-5 pp
3 | WEG S.A. | 1st Quarter 2010 Results
Distribution of Consolidated Gross Revenues per Business Area
ingles
Q1 2010
Electro-electronic Industrial Equipments
45.6%
Energy Generation , Transmission and Distribution
29.9%
Electric Motors for Domestic Use
16.8%
Paints and Varnishes
7.7%
Industrial
ElectricalElectronic
Equipment
Q4 2009
47.4%
31.4%
14.8%
6.4%
%
Q1 2009
-1.8 pp 52.3%
-1.4 pp 33.3%
2 pp
9.0%
5.3%
1.3 pp
%
-6.7 pp
-3.4 pp
7.7 pp
2.4 pp
The industrial electrical-electronic equipment area includes low and medium
voltage electric motors, drivers, industrial automation equipment and services,
and maintenance services and parts. We compete in all the major world
markets with our products and solutions.
Economic conditions continued to improve this quarter, with positive impact on
demand for capital goods. However, the pace of activity recovery is not uniform
and the variability of the improvement can be observed in the client segments
as in products and geographies.
The upturn is still clearer in Brazil than in other international markets. The
industrial production data released by the IBGE show growth of 17.2% in the
first two months of 2010 over the same period of 2009. Considering the
previous twelve months the comparison is still negative at 2.6% but the trend is
one of consistent reduction in the pace of this reduction and the current level of
industrial production is already close to that observed in mid-2008.
The recovery of the Brazilian industry is being driven primarily by expansion in
the production of durable goods. But the industrial production of capital goods,
the indicator that is more adequate to gauge relevant demand conditions for
WEG, already shows clear signs of recovery, having accumulated 19.1%
growth in the first two months of 2010.
The comparison based on the past 12 months still shows a significant drop of
12.7%, reflecting both the depth of the adjustment triggered by the international
crisis in 2009 as well the ample product gap in this category, a result of the
increasing need for investment in capacity expansion.
On the international markets were our presence is more important, the recovery
occurs in very different rhythms. The 2008/2009 financial crisis originated in the
so-called developed countries and these were most affected in their economic
fundamentals. The effects of the crisis on emerging markets seem to have been
less profound. This has been reflected in the speed at which the recovery of
economic activity occurs in these markets: much faster and clearer in emerging
markets like Asia and Latin America, and far more slow and difficult in mature
economies, such as North America and Europe. We are moving resources
between the various markets in search of greater economic dynamism.
Equipment for
Generation,
Transmission
and Distribution
This business area includes the following products and services: generators for
hydro and thermal power plants, water turbines, transformers, substations,
control panels, and system integration services. Our operations are currently
concentrated in Brazil but we are investing to expand our operating base to
other international markets over the next years.
One of the more characteristic features of this area of business is its long
business cycle. The equipment design and manufacturing lead times are also
comparatively longer than in other areas. This characteristic creates a relatively
longer period of time between the moment of sale, considered as the firm
order, and the moment timing of revenue recognition, which happens upon the
transfer of ownership of the equipment to the customer. Additionally,
generation, transmission and distribution projects’ deadlines consider
maturation periods of several years.
4 | WEG S.A. | 1st Quarter 2010 Results
These characteristics of extended periods of time leads to the postponement of
investment decisions in times of greater economic instability, as experienced
during the crisis of 2008/2009. Throughout 2009 we maintained the revenue
growth rate in GTD by servicing our backlog of orders. From the Q4 2009 we
began to observe the reflection of the slower pace of the sales on the Gross
Revenue growth rate.
Recovery of growth dynamics in this area should happen gradually, with
improvement in economic conditions and the normalization of credit conditions
for the industry, allowing the entry of new orders that will turn into revenues over
the coming months. The fundamentals favoring growth of distributed power
generation and renewable energy have not changed and the segment
continues to be attractive.
We are increasing geographical diversification in this business area, expanding
our operations beyond Brazil, both commercially and with production units.
Besides the power transformer factory in Mexico, opened in 2009, we are
building a high voltage electric motors and generators plant in India.
Another important recent step has been the splitting up of the Energy business
unit in two areas with greater autonomy: Energy, including mainly the generation
business, and T & D, including the transmission and distribution businesses.
These new units will continue to work to offer the best integrated solution to our
customers and, at the same time, will have greater autonomy to pursue specific
business opportunities in their respective areas of expertise.
Motors for
Domestic Use
In this business area, our operations are mainly focused in Brazil, where we
hold a significant share in the market of single-phase motors for durable
consumer goods.
The characteristic of this business area is the short business cycle, a result of
both the speed of the purchasing decisions of customers as well the fast
reaction rate of production to changes in final demand. Thus, the recovery of
demand for this area began as early as mid-2009, a direct result of measures
to reduce the federal excise tax, adopted to encourage the consumption of
household appliances of the so-called "white line".
The segment continued to show excellent production and sales performance,
even with the end of the temporary incentive measures, as was already
expected by the manufacturers of electro-domestic goods. Sales dynamics is
now tied to favorable consumer credit conditions and rising disposable income.
Growth comparisons are, moreover, favored by weak comparison basis in early
2009.
Paints and
Varnishes
In this area, including liquid paints, powder paints and varnishes, electroinsulators, we have very clear focus on industrial applications in Brazil.
We strategically approach this market by cross-selling to customers from other
business areas. By doing so, we maximize the new products’ development
cycle and archive economies of scale. As always, the sales performance in this
area tends to follow the same general trend established by other business
areas.
5 | WEG S.A. | 1st Quarter 2010 Results
Operating Results (R$ Thousand)
(EBITDA according to methodology established by CVM Directive
Release 01/07)
Net Operating Revenues
Cost of Goods Sold
Gross Operating Profit
(-) Selling Expenses
(-) General & Administrative
(-) Profit Sharing
Result from Activities
(+) Depreciation & Amortization
EBITDA
EBITDA Margin
Cost of Goods
Sold
Q1 2010
931,907
(624,453)
307,454
(93,098)
(58,097)
(20,094)
136,166
45,584
181,750
Q4 2009
1,076,969
(732,742)
344,227
(103,360)
(45,967)
(16,594)
178,306
50,241
228,548
19.5%
21.2%
Change
-13.5%
-14.8%
-10.7%
-9.9%
26.4%
21.1%
-23.6%
-9.3%
-20.5%
Q1 2009
1,048,240
(736,287)
311,953
(103,623)
(57,395)
(17,546)
133,390
47,722
181,112
Change
-11.1%
-15.2%
-1.4%
-10.2%
1.2%
14.5%
2.1%
-4.5%
0.4%
17.3%
Cost of Goods Sold (COGS) totaled R$ 624.5 million in Q1 2010, down 15.2%
compared to Q1 2009 and by 14.8% compared to Q4 2009. Gross margin for
Q1 2009 was 33.0%, increasing by 3.2 percentage points compared to Q1
2009 and by 1.0 percentage points over the previous quarter.
The trend of gradual recovery of gross margin, already outlined in the previous
two quarters, continued. The positive effects from of costs containment
measures, the continuous improvement program and of production capacity
adequacy, are more becoming more evident.
Selling,
General &
Administrative
Expenses
Consolidated selling, general and administrative expenses (SG&A) represented
16.2% of Net Operating Revenues in the Q1 2010, 0.8 percentage points
higher in relation to the Q1 2009 and 2.4 percentage points higher in relation to
the Q4 2009.
The comparison of operating expenses in absolute terms shows a 6.1%
decrease over Q1 2009 and stability over the previous quarter.
EBITDA
As a result of the previously mentioned effects, the EBITDA in the Q1 2010
(calculated according to the methodology established by the CVM Directive
Release 01/07) reached R$ 181.7 million, for a small increase of 0.4% over Q1
2009 and 20.5% decrease in relation to the previous quarter. EBITDA margin
stood at 19.5%, 2.3 percentage point higher year-on-year and 1.7 percentage
points lower quarter on quarter.
Financial
Revenues and
Expenses
In the Q1 2010 financial income reached R$ 71.3 million (R$ 92.90 million in
Q1 2009 and R$ 103.4 million in Q4 2009). Financial Expenses, net of interest
on stockholders capital declared in the period, reached R$ 52.7 million (R$
63.1 million in Q1 2009 and R$ 71.8 million in Q4 2009).
In this quarter, Net Financial Income was positive in R$ 18.6 million (positive in
R$ 29.8 million during Q1 2009 and R$ 31.6 million on Q4 2009). The positive
result steams from the relative stability of the Brazilian currency during the
quarter and from the net cash position held through the period.
Income Tax
and Social
Contribution
Provision for Income Tax and Social Contribution on Net Income in the Q1 2010
reached R$ 25.5 million (R$ 32.2 million on Q1 2009 and R$ 61.8 million on
Q4 2009). Additionally, we also accounted for R$ 11.5 million in Deferred
Income Taxes.
Net Income
As a result of the previously mentioned effects, Net Earnings during the Q1
2010 amounted to R$ 119.1 million, 2.6% lower year-on-year and 12.7% lower
quarter on quarter. Net margin for the quarter stood at 12.8%.
Debt and Cash Position (R$ Thousands)
6 | WEG S.A. | 1st Quarter 2010 Results
CASH & EQUIVALENT
DEBT
- Current
- Long Term
NET CASH (DEBT)
Capitalization
March 2010
1,962,538
1,782,466
814,274
968,192
180,072
December 2009
2,127,117
1,872,533
895,885
976,648
254,584
March 2009
1,815,164
2,099,941
1,171,587
928,354
(284,777)
We have obtained positive results with the adoption of financial policies that
strive to maintain sufficient funds and liquidity sources to meet operating and
investment funding needs. Generally, these policies are:
„ We use short-term, foreign-currency denominated sources to finance trade
operations, taking advantage of the natural hedge and constantly monitoring
financial exposure to foreign exchange variations.
„ Our long-term debt is mainly contracted in Brazilian currency, using funding
sources available at development agencies.
„ Cash funds are invested in first-tier banks and mostly in Brazilian currency
denominated instruments.
On March 31st, 2010, cash and equivalents totaled R$ 1,962.1 million and
gross financial debt amounted R$ 1,782.5 million, resulting in a net cash
position of R$ 180.1 million (net debt of R$ 284.8 million in March 31, 2009).
The breakdown of gross debt is:
„ Short-term debt totaled R$ 814.3 million (46% of total debt), represented by
foreign-currency denominated trade finance and by the current portion of
long-term debt with the Brazilian National Development Bank (BNDES) and
other development agencies usually in domestic currency.
„ Long-term debt totaled R$ 968.2 million (54% of total debt) largely
represented by loans contracted with BNDES and other development
institutions mostly in domestic currency, and by the long-term portion of
working capital financing for overseas-Based subsidiaries in the respective
currency of each country.
According to the currency of denomination, the breakdown of total debt is as
follows:
„ In Reais, totaling R$ 1,280.4 million (accounting for 72% of total debt)
represented by loans contracted with BNDES and development agencies;
„ In other currencies, totaling R$ 502.1 million (accounting for 28% of total
debt) mainly represented by trade finance operations (Advances on Foreign
Exchange Contracts or ACC) and working capital financing contracted by
overseas-based subsidiaries in their respective domestic currencies.
Investments
Investments in fixed assets for production capacity expansion totaled R$ 61.4
million during the first three months of 2010, of which 44% were allocated to
7 | WEG S.A. | 1st Quarter 2010 Results
industrial complexes and other facilities in Brazil and 54% to production units
and overseas-based subsidiaries.
Investments in Fixed Assets (R$ million)
Outside Brazil
Brazil
91,9
20,1
71,8
Q1 09
63,5
15,7
61,4
47,8
32,7
13,7
19,1
38,2
13,8
24,3
27,2
Q2 09
Q3 09
Q4 09
Q1 10
34,2
WEG’s common share price went from R$ 11.68 on the last trading section of
the Q1 2009 to R$ 19.00 on March 31st, 2010, for a nominal increase of
62.7%. Considering dividends and interest on stockholders’ equity declared
during the period, the total return was 67.6%.
Share Price
Performance
The average daily traded volume during the Q1 2010 reached R$ 6.0 million,
69.7% above the average of the Q1 2009. During the quarter, 31.484 trades
took place (15.342 during the Q1 2009) involving 19.7 million shares (18.0
million shares during Q1 2009), to a total amount of R$ 357.9 million (R$ 214.3
million during Q1 2009).
Share Price Performance and Traded Volume
30,00
3.000
Thousand Shares Traded
25,00
WEGE3+4
WEGE3+4
2.000
15,00
10,00
1.000
Traded Shares (th)
20,00
5,00
0,00
0
Performance adjusted by dividends and interest on stockholders’ equity
Dividends
On March 23, the Board of Directors approved shareholders’ compensation as
interest on stockholders’ equity, in the total amount of R$ 31.4 million (R$ 26.7
million after withholding of income tax). Shareholders on record on March 23,
8 | WEG S.A. | 1st Quarter 2010 Results
2010 will be entitled to receive R$ 0.043 (net of income taxes) per share, with
payment scheduled to occur from August 11, 2010 onwards.
We maintain our policy of declaring quarterly interest on stockholders’ equity
and semi-annual, based on intermediate results.
New
Organizational
Structure
On January 27, 2010 we announced changes in organizational structure, with
the creation of the "T&D” (transmission and distribution) business unit and the
appointment of new corporate officers.
“We are aligning WEG with current trends and market needs, with strong focus
on internationalization, new business segments and opportunities" said Mr.
Harry Schmelzer, CEO of WEG SA. "The changes in structure take into account
the involvement of areas in productivity gains and competitiveness," added Mr.
Schmelzer.
The unit WEG Energy was divided into "WEG Energy” and “WEG T & D. The
objective is to diversify and expand the business and products in the area of
generation, transmission and distribution energy.
WEG T & D concentrates on business currently carried by WEG
Transformadores, Trafo, WEG Mexico (Transformers) and the subsidiary Voltran.
Mr. Carlos Diether Prinz, Managing Director of WEG Transformadores, was
promoted to Superintendent Officer of the new unit
WEG Energy's business focus is special high voltage electric motors,
generators and the development of new businesses, products and systems for
renewable and emergency energy generation. The business unit is now headed
by Mr. Sinésio Tenfen, who was promoted to Superintendent Officer of WEG
Energy. Complementing the new structure Mr. Newton Idemori was appointed
as New Business Development Officer.
Mr. Luis Figueiredo was appointed as Human Resources Officer and Mr.
Antonio Cesar da Silva will be the Chief Marketing Officer.
Mr. Robert Bauer, former Head of the Energy business unit, will now lead the
International Division, replacing Mr. Sergio Schwartz, WEG’s Vice President,
which will now lead the areas of Control, Finance, Information Technology and
Legal. Two new officers were appointed under Mr. Schwartz: Mr. Wilson
Watzko is now WEG’s Controller, and Mr. Laurence Beltrão Gomes as Finance
Officer.
###
9 | WEG S.A. | 1st Quarter 2010 Results
Conference
Calls
WEG will hold conference calls, when Management will present the results.
Conference in English:
Date : April 29th, 2010, Thursday
Time: see table
Location
Continental Europe (CEST)
United Kingdom (BST)
Brasília (Brazil - Distrito Federal)
US East Cost (EDT)
US West Coast (PDT)
H
H
Local time
4 p.m.
3 p.m.
11 a.m.
10 a.m.
7 a.m.
Time zone
UTC + 2 hour
UTC+1 hour
UTC – 3 hours
UTC – 4 hours
UTC – 7 hours
UTC = Coordinated Universal Time (UTC or GMT
Connection Numbers
„ Calling from Brazil: (0-XX-11) 4688-6301
„ Calling from USA: 888-700-0802
„ Calling from other Countries: +1 786-924-6977
Password: WEG
Conference in Portuguese:
Date : April 29th, 2010, Thursday
Time: 9:00 am (Brasília time)
Connection Numbers
„ Calling into Brazil: +55 11 4688 6301
Password: WEG
The presentation will be available in the Investor Relations page of WEG website
www.weg.net/ir . Please call approximately 10 minutes before the call is
scheduled to start.
HU
UH
The information contained in this report relating to the Company business perspectives, projections
and results and Company growing potential should be considered as only forecasts and were based
on the management expectations relating to the future of the Company. These expectations are
highly influenced by the market conditions and the general economic performance of the country and
of the foreign markets which may change suddenly.
10 | WEG S.A. | 1st Quarter 2010 Results
Annex I
Consolidated Income Statement - Quarterly
Figures in R$ Thousands
1st Quarter
2010
R$
AV%
GROSS REVENUES
Domestic Market
External Market
Taxes and Deductions
NET REVENUES
COST OF GOODS SOLD
GROSS PROFIT
Sales Expenses
Administrative Expenses
Financial Expenses
Financial Revenues
Other Operating Results
Earnings from Subs (Equity Method)
EARNINGS BEFORE TAXES
Participations
Income Taxes & Contributions
Cash Dividends Reversal
Deferred Taxes
Minorities
NET EARNINGS
EBITDA
11 | WEG S.A. | 1st Quarter 2010 Results
1,131,546
801,299
330,247
-199,639
931,907
-624,453
307,454
-93,097
-58,097
-84,084
71,255
-17,241
-68
126,122
-784
-25,472
31,424
-11,486
-730
119,074
121%
86%
35%
-21%
100%
-67.0%
33.0%
-10.0%
-6.2%
-9.0%
7.6%
-1.9%
0.0%
13.5%
-0.1%
-2.7%
3.4%
-1.2%
-0.1%
12.8%
181,750 19.5%
4th Quarter
2009
R$
AV%
1,306,913
871,619
435,299
-229,944
1,076,969
-732,743
344,226
-103,360
-45,966
-83,548
103,434
-33,178
1,186
182,794
-1,151
-61,773
11,739
8,871
-4,054
136,426
121%
81%
40%
-21%
100%
-68.0%
32.0%
-9.6%
-4.3%
-7.8%
9.6%
-3.1%
0.1%
17.0%
-0.1%
-5.7%
1.1%
0.8%
-0.4%
12.7%
228,548 21.2%
1st Quarter
2009
R$
AV%
1,270,984
802,351
468,632
-222,743
1,048,241
-736,287
311,954
-103,622
-57,396
-95,792
92,883
-20,369
676
128,334
-473
-32,160
32,716
-5,123
-1,101
122,193
Changes %
1Q09
1Q09
4Q08
1Q09
121%
-13.4%
-11.0%
77%
-8.1%
-0.1%
45%
-24.1%
-29.5%
-21%
-13.2%
-10.4%
100%
-70.2%
-13.5%
-14.8%
-11.1%
-15.2%
29.8%
-10.7%
-1.4%
-9.9%
-9.9%
-10.2%
-5.5%
26.4%
1.2%
-9.1%
0.6%
-12.2%
8.9%
-31.1%
-23.3%
-1.9%
-48.0%
-15.4%
0.1%
12.2%
0.0%
n.m
-31.0%
-31.9%
n.m
-1.7%
65.8%
-3.1%
-58.8%
-20.8%
3.1%
167.7%
-3.9%
-0.5%
n.m
124.2%
-0.1%
-82.0%
-33.7%
11.7%
-12.7%
-2.6%
181,112 17.3%
-20.5%
0.4%
Annex II
Consolidated Balance Sheet
Figures in R$ Thousands
CURRENT ASSETS
Cash & Cash Equivalents
Receivables
Inventories
Other Current Assets
LONG TERM ASSETS
Lawsuits Receivables
Deferred Taxes
Other Long Term Assets
FIXED ASSETS
Investment in Subs
Property, Plant & Equipment
Deferred Assets
March 2010
R$
AV%
70
3,803,788
73%
1,962,538
38%
864,517
17%
812,461
16%
3%
164,272
3%
170,517
31,063
1%
2%
89,481
1%
49,973
24%
1,231,837
0%
16,861
21%
1,091,408
123,568
2%
December 2009
R$
AV%
67
3,973,158
74%
2,127,117
40%
910,136
17%
758,116
14%
3%
177,789
193,814
4%
30,739
1%
2%
101,739
61,336
1%
1,206,635
22%
0%
16,041
1,061,734
20%
128,860
2%
March 2009
R$
AV%
58
4,164,099
74%
1,815,164
32%
996,032
18%
1,051,556
19%
5%
301,347
196,260
4%
1%
52,282
1%
79,571
1%
64,407
1,229,205
22%
0%
14,129
1,096,099
20%
2%
118,977
TOTAL ASSETS
5,206,142 100%
5,373,607 100%
5,589,564 100 %
CURRENT LIABILITIES
Suppliers
Taxes & Contributions
Short Term Debt
Dividends Payable
Advances from Clients
Profit Sharing
Other Current Assets
LONG TERM LIABILITIES
Long Term Debt
Provisions
Other Long Term Liabilities
MINORITIES
NET WORTH
TOTAL LIABILITIES
1,582,381
206,530
162,183
814,274
29,454
221,004
23,191
125,745
1,150,004
968,192
101,565
80,247
25,274
2,448,483
30%
4%
3%
16%
1%
4%
0%
2%
22%
19%
2%
2%
0%
47%
5,206,142 100%
12 | WEG S.A. | 1st Quarter 2010 Results
1,825,846
188,779
165,331
895,885
164,134
254,864
54,088
102,765
1,160,757
976,648
99,434
84,675
24,217
2,362,787
34%
4%
3%
17%
3%
5%
1%
2%
22%
18%
2%
2%
0%
44%
5,373,607 100%
2,183,152
259,141
175,430
1,171,587
30,304
439,383
19,720
87,587
1,114,359
928,354
151,724
34,281
43,263
2,248,790
39%
5%
3%
21%
1%
8%
0%
2%
20%
17%
3%
1%
1%
40%
5,589,564 100 %
Annex III
Consolidated Cash Flow Statement
Figures in R$ Thousands
3 Months
2010
12
Operating Activities
Net Earnings before Taxes
Depreciation and Amortization
Earnings from Subs (Equity Method)
Provisions:
Profit Sharing
Interest on Stockholders Equity
Other Provisions
(Increase) / Reduction of Accounts Receivable
Increase / (Reduction) of Accounts Payable
(Increase) / Reduction of Investories
Income Tax and Social Contribution on Net Earnings
Profit Sharing Paid
3 Months
2009
8
126,122
45,584
68
128,334
47,722
(676)
20,094
31,424
(2,105)
59,641
34,044
(55,872)
(63,566)
(44,947)
17,546
32,716
4,777
128,479
(65,658)
57,588
(28,728)
(47,514)
150,487
274,586
(61,392)
(792)
818
(2,191)
(204)
(91,888)
(683)
2,846
(19,450)
Cash Flow From Investment Activities
(63,557)
(109,379)
Financing Activities
Working Capital Financing
Long Term Financing
Dividends & Intesrest on Stockholders Equity Paid
(101,034)
10,967
(161,442)
(105,738)
44,464
(138,246)
Cash Flow From Financing Activities
(251,509)
(199,521)
Change in Cash Position
(164,579)
(34,314)
2,127,117
1,962,538
1,849,477
1,815,164
Cash Flow from Operating Activities
Investment Activities
Investments
Fixed Assets
Intagible Assets
Asset Write Downs
Accumulated Conversion Adjustment
Cash & Cash Equivalents
Beginning of Period
End of Period
13 | WEG S.A. | 1st Quarter 2010 Results