FERNANDO RAUL MIELI
Tel: 55.11.4478-1646 Fax: 55.11.4478-1500
E-mail: [email protected]
http// www.pqu.com.br
PETROQUÍMICA UNIÃO S.A.
MAY/2002
SELECTED LATIN AMERICAN
ECONOMIES BY SIZE
Mexico
Brazil
Argentina
Venezuela
Colombia
Chile
Peru
Total
GDP
(Billion US$)
618
504
270
125
82
67
63
1.729
Population
(Million)
105
170
37
24
42
15
26
419
Sources: IMF, World Bank, Quimax Analysis
According to latest reports form the International
Monetary Fund (IMF), Latin America’s GDP reached
US$ 1,9 trillion in 2001.
MAY/2001
ECONOMIC INDICATORS
ECONOMY MARKET WATCH
Sept 2003
BRAZIL
MEXICO
ARGENTINA
VENEZUELA
Improving
Stable
Scarce
Non Existent
9
4
17
30
GDP change (%) 2002
1.5
0,9
-12.0
-25.0
GDP change (%) 2003 E
1.0
1.5
4,0
-20.0
Consumer Confidence
Cautious
Cautious
Improving
Non Existent
Stable
Unstable
Stable
Non Existent
15%
5-10%
25% +
35%
Improving
Weak
Improving
Deteriorating
Foreign Investment
Inflation %
Currency Exchange
Unemployement
Economy
Source: Quimax Analysis
MAY/2001
PQU is one of three basic petrochemical
producers in Brazil and is located ...
MAY/2001
BRAZIL
PQU 2003
MAY/2002
THE BRAZILIAN PETROCHEMICAL
CAPACITY
(KMT / year of ethylene)
1200
1000
800
600
400
1979
200
1983
1972
0
PQU
BRASKEM
initial
COPESUL
actual
MAY/2001
Plastics per Capita
(kg/hab)
EUA
TAIWAN
JAPAN
SOUTH KOREA
CANADA
WEST EUROPE
ARGENTINA
MEXICO
BRAZIL
EAST EUROPE
CHINA
0
20
40
60
80
100
120
140
MAY/2001
THE BRAZILIAN NAPHTHA
59%
BRAZIL
19%
BRASKEN 22%
(COPENE)
2%
PQU
COPESUL
56%
Local Supplying
5%
95%
Domestic Supplying
42%
Foreign Supplying
MAY/2001
SÃO PAULO PETROCHEMICAL COMPLEX
GRANDE ABC
W.M.
UNIPAR
PQU
OXICAP
POLIBRASIL
CHEVRON
OXITENO CABOT
VITOPEL
PEU
UNIPAR
RECAP / PETROBRAS
PISCINÃO
COPAS
PHILIPS
CIAS DE GÁS
MAY/2001
SÃO PAULO COMPLEX
PQU has a secure supply of 4,600,000 tons/year
of naphtha, while consuming
1,800,000 tons/year.
São José dos
Paulínia
REPLAN
São Paulo Metropolitan
Region
Capuava
Santo
André
•Oxiteno
•Polietilenos União
RECAP
Mauá
•Unipar Div.Química
•Solvay Polietileno
Petrobras Refineries
Naphtha Pipelines
•Cabot
•Polibrasil Resinas
Petroquímica União
Ethylene Pipelines
REVAP
•Polibutenos
São Paulo
Ports
Campos
•Solvay Indupa do Brasil
Cubatão
•CBE
•DOW (Union
Carbide)
•Carbocloro
RPBC
TEBAR
SEBAT
Santos
São Sebastião
MAY/2002
THE BRAZILIAN PETROCHEMICAL
INDUSTRY
 The investments were promoted by government in the 70’s;
 Three plants basic petrochemical producers were respectively:
PQU, COPENE (Braskem), COPESUL;

Second generation (composed by the those who transform the raw
materials - e.g. polymers producers);

Third generation (transformers-final products to the market).
 PQU was the first petrochemical raw materials cracker plant in
Brazil.
 Now there are three major producers located in the South (the
Southern Complex), the Southeast (the PQU Complex), and
the Northeast (the Northeastern Complex).
MAY/2002
PQU is located in the richest and most industrialized
region in Brazil, accounting for 65% of the country’s
GDP (Gross Domestic Product) of US$ 500 billion.
The Region accounts
for the consumption of
75% of petrochemicals.
MINAS GERAIS
BELO HORIZONTE
ESPÍRITO
SANTO
VITÓRIA
SÃO PAULO
SÃO PAULO
RIO DE
JANEIRO
RIO DE JANEIRO
PQU supplies around
30% of the region’s
petrochemicals demand.
The total market net
sales = US$ 18,7 billion
(source: ABIQUIM/2002).
The region’s market net
sales = US$ 14,7 billion.
MAY/2002
PQU CAPACITY
PRODUCTS
ETHYLENE
PROPYLENE
BUTADIENE
BENZENE
CARBON BLACK FEED STOCK
SOLVENTS
GASOLINE
OTHER
TOTAL
PQU CAPACITY
(kt / yr)
500
250
80
200
120
180
20
170
1,520
MAY/2001
PETROQUÍMICA UNIÃO S.A.
UNITS
Raw Materials
Products
Processing
Butadiene
Extraction
Naphtha Pyrolysis
Hydrocarbon
Resins
NAPHTHA
Hydrotreatment
and Catalytic
Reforming
Aromatics
Extraction
Naphtha
Fractionation
Xylenes Isomeratizion
Heavy Alkylate
PIB
Pyrolysis
Gasoline
Hydrogenation
Hydrodealkilation
Aromatics
Fractionation
Aromatics
Solvents
• Butadiene
• Raffinate I
• Polyisobutylene
• Raffinate II
• “Unilene” Resins
•
•
•
•
•
Ethylene
Propylene Chemical Grade
Propylene Polymer Grade
Carbon Black Feedstock
Hydrogen
• C5 • C9 +
• Benzene
•
•
•
•
Benzene
Toluene
Xylenes (mix)
Ortho Xylene
• C9 Solvents
• C10 Solvents
• C11 Solvents
• Light Residue
MAY/2001
THE SÃO PAULO PETROCHEMICAL MARKET
PETROBRAS - RPBC / REPLAN / REVAP / RECAP
NAPHTHA
PETROQUÍMICA UNIÃO S.A.
ETHYLENE
500,000 tpy
DOW(UNION CARBIDE)
LDPE
C4 STREAM
99,000 tpy
PROPYLENE
250,000 tpy
POLIBRASIL
RESINAS
POLIBUTENOS
LDPE
EVA
UNIPAR DIV. QUÍMICA
NONENE /TETRAMER
CUMENE
OXITENO
ETHYLENE OXIDE
ETHYLENEGLYCOLS
BENZENE
200,000 tpy
PETROFLEX
SBR
LÁTEX
PP
PIB
POLIETILENOS UNIÃO
BUTADIENE
80,000 tpy
ELEKEIROZ
MALEIC
ANHYDRIDE
DOW
LATEX
PS exp
PHENOL / BPA
NYLON
LÁTEX
CBE
IQT
BAYER
ANILINE
NITRIFLEX
PHTHALATES
CABOT
CARBON BLACK
COLUMBIAN
TOLUENE
75,000 tpy
XILENES
80,000 tpy
NBR
LÁTEX
C9/10/11
20,000 tpy
STYRENE
MONOMER
SOLVENTS
AND
SULFONATION
BASF
RESINOR
VCM
SOLVAY INDUPA
(ARG)
PS exp
LATEX
PS
TRIKEM - SP
PVC
VCM
DISTRIBUTION
GLP
50,000 tpy
PET
RHODIACO
PTA
TR
SM
TRIKEM- (AL)
GASOLINE
180,000 tpy
RHODIA-STER
UNILENE RESINS
12,000 tpy
KRATON
SOLVAY POLIETILENO
HDPE
PHTHALIC
ANHYDRIDE
CARBON BLACK
PHTHALIC
ANHYDRIDE
RHODIA
EDC
VCM
PVC
PETROM
LATEX
CARBOCLORO
SOLVAY INDUPA
CARBON
BLACK
FEEDSTOCK
120,000 tpy
O-XYLENE
50,000 tpy
EDN (BA)
EDN-SUL
PS
PAINTING INKS,
ADHESIVES, RUBBER
P-XYLENE
MAY/2002
COPENE (BA)
MARKET OF PQU’s PRODUCTS
Paint and Vernishes
0,9%
Plasticizers
3,1%
Solvents
4,4%
Adhesives
0,2%
Others
13,6%
Plastics
39,3%
Rubbers
4,2%
Sinthetic fibers
8,4%
Intermediate
chemicals
25,8%
MAY/2001
BRAZILIAN MARKET-SHARE
2002
MAY/2002
PQU
Composed by Shareholders
MAY/2002
PQU
Personnel/million ton of chemicals
produced
700
600
601
559
558
500
400
309
300
283
243
200
100
0
1991
PqU
USA & Canada = 210
Average = 283
Europe = 194
1993
1995
1997
1999
2001
Source: Solomon Associates
MAY/2002
PQU
Total Sales
MAY/2001
PQU
Business Opportunities
 The production capacity
 Infra-structure
New water supply system
Power Generation
 Integration Upstream and
Downstream
MAY/2002
PQU PROJECT
NATURAL GAS
301 KTA
1.280.000 m3/day
NATURAL GAS
56 KTA
240.000 m3/day
ETHYLENE
REVAP
200 KTA
BYPRODUCTS 191 KTA
RECAP
FCC OFF GAS
353 KTA
PETROQUIMICA UNIAO
IMPORTED NAPHTHA
208 KTA
• Natural Gas consumption in Refineries: 357 KTA or 1.520.000 m3/day
• Natural Gas substitution at PQU: 61 KTA or 375.000 m3/day
• Natural Gas additional consumption (from BOLIVIA): 296 KTA or 1.145.000
m3/day.
MAY/2001
PROJECT INVESTMENT
PETROBRAS/REVAP
Pre-treatment + Compression
TOTAL
16
16
PETROQUIMICA UNIÃO
Modifications in Olefins Unit
35
FCC Off Gas Treatment Unit
53
105 Km pipe from REVAP to PQU
20
Modifications in Aromatics Unit
10
Modifications in Utilities Unit
Contingencies: 10% + Working
Capital
TOTAL INVESTMENT PREDICTED
144
5
21
160
Values in millions of dollars
MAY/2001
PQU PROJECT SCHEDULE
1. Comercial Negotiations:
end of 2003
2. Basic Engineering:
feb/2004
3. EPC Contract:
may/2004
4. Previous Enviromental License:
jul/2004
5. Construction start:
nov/2004
6. Plant Start up:
jun/2007
MAY/2001
PQU
BALANCE SHEETS
AS OF DECEMBER 31, 1999, 2000, 2001,2002 and Sept/2003
In thousands of reais - R$
ASSETS
CURRENT ASSETS
Cash & Equivalents
Short-term Investments
Accounts Receivable - trade
Inventories
Other Current Assets
LONG-TERM ASSETS
Prepaid and Deferred Income Taxes
Other Credits
PERMANENT ASSETS
Investments
Fixed Assets (net)
Deferred Charges
TOTAL ASSETS
1999
2000
2001
2002
127.904
585
65.367
53.209
8.743
170.383
678
95.166
56.160
18.379
195.148
983
115.070
53.887
25.208
303.734
17.442
148.238
97.193
40.861
316.937
7.176
22.678
10.653
12.025
38.562
15.171
23.391
10.610
6.689
3.921
56.779
36.712
20.067
48.704
32.126
16.578
876.305
47.780
802.368
26.157
856.499
60.889
781.620
13.990
904.353
81.062
819.758
3.533
996.405
123.118
868.625
4.662
967.292
102.061
859.475
5.756
1.026.887
1.065.444
1.110.111
1.356.918
1.332.933
Sept 2003
180.327
105.846
23.588
MAY/2001
PQU
BALANCE SHEETS
AS OF DECEMBER 31, 1999, 2000, 2001,2002 and Sept/2003
In thousands of reais - R$
LIABILITIES
1999
2000
2001
2002
CURRENT LIABILITIES
Suppliers
Loans and Financing
Taxes
Payroll and Social Charges
Other Current Liabilities
226.446
45.197
68.071
19.063
5.148
88.967
260.653
22.225
85.257
15.566
5.527
132.078
243.183
64.517
41.274
36.784
3.909
96.699
392.668
188.639
80.707
39.222
4.945
79.155
553.948
180.300
302.104
42.563
6.073
22.908
LONG-TERM LIABILITIES
Loans and Financing
Deferred Taxes
Other Long-term Liabilities
237.457
135.511
101.946
-
225.950
124.761
101.189
-
253.233
140.746
104.810
7.677
438.997
303.164
96.478
39.355
204.366
60.904
93.298
50.164
STOCKHOLDERS' EQUITY
Capital Stock
Capital Reserve
Revaluation Reserve
Income Reserves
Retained Earnings
562.984
268.541
9.770
169.619
115.054
-
578.841
268.541
13.684
162.054
134.562
-
613.695
268.541
13.724
193.021
138.409
-
525.253
268.541
12.650
180.805
63.257
-
574.619
268.541
9.401
173.729
63.163
59.785
1.026.887
1.065.444
1.110.111
1.356.918
1.332.933
TOTAL LIABILITIES
Sept 2003
MAY/2001
PQU
Financial
Current Ratio (x)
Quick Ratio (x)
Debt Equity Ratio (x)
Gross Margin
Net Profit Margin
Return on Equity
Return on Average Assets
Payout
Equity/Total Assets
Equity/Consolidated Loans (x)
Long Term Consolidated Debt/Total
Long Term Consolidated Debt/Equity
1999
2000
2001
2002
0,56
0,33
0,82
24,9%
8,6%
12,8%
7,2%
56,7%
54,8%
3,61
20,5%
8,3%
0,65
0,44
0,84
17,0%
9,7%
22,8%
12,8%
57,7%
54,3%
4,00
17,9%
4,5%
0,78
0,56
0,81
11,8%
5,5%
13,8%
7,4%
170,7%
55,3%
5,52
22,3%
11,6%
0,77
0,53
1,58
7,5%
0,3%
0,9%
0,4%
1556,5%
38,7%
2,06
30,2%
17,4%
Jan/Sept
2003
0,57
0,38
1,32
8,7%
3,3%
13,4%
5,5%
87,3%
43,1%
2,35
26,3%
10,6%
MAY/2001
PQU
PROFITABILITY EVOLUTION
Profit/Net Worth
22,8%
13,0%
12,8%
12,2%
8,5%
0,9%
2,6%
1997
1998
1999
2000
2001
2002
Jan/Sept
2003
MAY/2001
PQU
Index
Daily Sales - Average
Petrochemical - ton/day
Ethylene - ton/day
Utilities Consumption
Water - m3/ton pb
Electric Power - mw/ton pb
Productivity Index
Petrochemical - ton/employee
Net Sales - R$ thousands/employee
Fixed Cash Cost/Sales
- R$/ton
1999
2000
2001
2002
3.961
1.294
4.130
1.277
3.937
1.216
3.487
1.121
Jan/Sept
2003
3.863
1.241
4,33
0,09
4,15
0,11
4,47
0,09
4,61
0,13
4,39
0,14
225
125,5
239
208,4
229
223,2
193
210,5
214
319,0
35,79
37,48
44,31
59,17
65,49
MAY/2001
PQU
P&L STATEMENTS
For the years ended DECEMBER 31, 1999, 2000, 2001, 2002 and
Jan/Sept.2003
In thousands of reais - R$
DESCRIPTION
1999
832.912
(625.814)
207.098
Gross Profit
(121.830)
Operating (Expenses) Income
(8.913)
Selling Expenses
General and Administrative Expenses (18.713)
(88.498)
Financial Expenses (Net)
(3.348)
Taxes
(2.358)
Other Operating (Expenses) Income
Net Sales
Cost of Products and Services Sold
Operating Income
Non Operating Expenses (Net)
Income before Income
Taxes and Participations
Income and Social Contribution Taxes
Net Income for the Period
Number of Shares (thousands)
Income per Share - R$
2000
2001
2002
1.355.429
(1.125.185)
230.244
(65.579)
(8.318)
(23.528)
(35.687)
(6.914)
8.868
1.446.589
(1.275.232)
171.357
(91.415)
(11.169)
(22.988)
(50.481)
(10.513)
3.736
1.401.965
(1.296.325)
105.640
(178.591)
(15.890)
(32.782)
(126.544)
(9.648)
6.273
Jan/Sept
2003
1.604.999
(1.465.003)
139.996
(29.461)
(16.611)
(19.052)
16.467
(11.093)
828
85.268
164.665
79.942
(72.951)
110.535
1.050
8.882
20.999
45.302
(20.838)
100.941
(20.921)
80.020
100.199
0,7986
(27.649)
32.553
4.904
100.199
0,0489
89.697
(37.082)
52.615
100.199
0,5251
86.318
(14.313)
72.005
100.199
0,7186
173.547
(41.718)
131.829
100.199
1,3157
MAY/2001
PQU
Sales and Profits
R$ million
1650
140,0
1500
120,0
1350
100,0
1200
80,0
1050
900
60,0
750
40,0
600
20,0
450
-
300
150
(20,0)
0
(40,0)
1994
1995
1996
1997
NET SALES
1998
1999
2000
2001
2002
Jan/Sept
2003
PROFIT
MAY/2001
PQU
EBITDA
1999
EBITDA
In thousands of reais - R$
235.018
2000
255.635
2001
193.758
2002
130.168
Jan/Sept
2003
133.253
28,2%
18,9%
13,4%
9,3%
8,3%
Total Debt/EBITDA
0,7x
0,6x
0,6x
2,0x
1,4x
EBITDA/Paid Interest
7,5x
10,2x
8,1x
7,6x
5,7x
EBITDA/Net Sales
MAY/2001
PQU
EBITDA/Net Sales
MAY/2001
PQU
ADDED VALUE
1999
2000
2001
2002
In thousands of reais- R$
Income (sales and nonoperating
income)
1.043.721
1.707.602
2.031.217
1.983.527
Costs
(671.180) (1.270.656) (1.453.733) (1.462.033)
Gross Added Value
372.541
436.946
577.484
521.494
Depreciation/Amortization/Provision
for maintenance shutdown
(49.525)
(45.051)
(50.225)
(70.053)
Net Added Value
323.016
391.895
527.259
451.441
Transferences
5.703
12.607
25.595
53.450
Added Value to allocate
328.719
404.502
552.854
504.891
Personnel Expenses
Taxes and Duties
Financial Expenses
Shareholders' Revenue
Profit Reserve
Total Added Value
Jan/Sept
2003
2.253.701
(1.712.914)
540.787
(31.654)
509.133
(15.026)
494.107
32.380
124.942
90.631
77.356
3.410
36.354
190.618
38.022
120.000
19.508
35.602
373.466
55.185
84.754
3.847
33.465
326.735
130.311
89.533
(75.153)
27.336
420.925
(13.845)
59.691
328.719
404.502
552.854
504.891
494.107
MAY/2001
PQU
VALUE ADDED – APROPRIATION
R$ million
MAY/2002
PQU
considers environmental
protection a priority



PQU is a sponsor of the Responsible Care Program.
The Company made substantial investments, around
US$ 56 million, to keep its plant and operations in
compliance with environmental laws and regulations.
The Company now is fully compliant with the State of
São Paulo’s Environment Protection Authority.
MAY/2002
PQU
PETROQUÍMICA UNIÃO S.A.
Av. Presidente Costa e Silva, 1178
09270-901 Santo André - São Paulo - Brazil
Tel: 55.11.4478-1515 Fax: 55.11.4478-1500
E-mail: [email protected]
http// www.pqu.com.br
MAY/2001