1
Foward-Looking Statements
Certain of the statements contained herein are forward-looking
statements based on Management’s current estimates regarding future
performance that may result in material differences regarding future
results, performance and events. In fact, actual results, performances or
events may differ materially from those expressed or implied by the
forward-looking statements, as a result of several factors, such as the
general and economic conditions in Brazil and other countries, interest
rate and exchange rate levels, future rescheduling or prepayment of
debt denominated in foreign currencies, protectionist measures in the
US, Brazil and other countries, changes in laws and regulations and
general competitive factors (on a global, regional or national basis).
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Current Situation
 A private logistics company
Transnordestina operates the
Network of the former RFFSA;
Existing railway
Stretch under renovation
 The rail network extends for 4,238 km: 2,722
km of which operational, 408 km under
renovation and 1,108 km under deactivation
process with ANTT (Brazilian National Agency for
Land Transportation);
Porto do Itaqui
SÃO LUÍS
Porto de Pecém
Sobral
FORTALEZA
Porto do Mucuripe
CRATEÚS
TERESINA
MA
TERESINA
CE
CE
PIQUET CARNEIRO
Jucurut ú
RN
RN
Uruçuí
Eliseu
Martins
C.Grande
Crato
PI
PI
Ribeiro
Gonçalves
MISSÃO
Missão
VELHA
Velha
ARARIPINA
SALGUEIRO
SALGUEIRO
PE
NATAL
Porto do
Cabedeiro
PB
Caruarú
PE
Cinco Pontas
AL
AL
SE
(15.4 million SE
ha)
Propriá
 Capacity: 2.0 million tonnes p.a.;
RECIFE
Porto de Suape
PETROLINA
BA
BA
 Operates with 100 locomotives and 1,743 rail
cars;
JOÃO PESSOA
PB Caruarú
PARNAMIRIM
Eliseu
Martins
Barreiras
since 1998,
Northeastern
MACEIÓ
 Gross Revenue (2009): R$ 81 million;
Porto de Jaraguá
 Transported volume (2009): 731,945 thousand
RTK or 1,472,000 tonnes.
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Transnordestina Project
Existing railway
New stretches
Stretch under renovation
 Integrated logistics solution to attend Brazil’s
northeast region, especially the transportation of
agricultural products and ore;
Porto do Itaqui
SÃO LUÍS
 1,728 km of extension connecting Eliseu Martins
(PI) with the ports of Suape (PE) and Pecém (CE),
near large consumer markets and able to operate
capesize ships;
Porto de Pecém
Sobral
FORTALEZA
Porto do Mucuripe
CRATEÚS
TERESINA
MA
TERESINA
CE
CE
PIQUET CARNEIRO
NATAL
Jucurut ú
RN
RN
Uruçuí
Ribeiro
Gonçalves
Eliseu
Martins
C.Grande
Crato
PI
PI
MISSÃO VELHA
ARARIPINA
Missão Velha
Salgueiro
SALGUEIRO
Eliseu
Martins
PB
PB Caruarú
PARNAMIRIM
Caruarú
PE
PE
Porto do Cabedeiro
JOÃO PESSOA
Cinco Pontas
RECIFE
Porto de Suape
PETROLINA
AL
AL
BA
BA
Barreiras
SE
SE
Propriá
 World-class Railway:
 Wide and mixed gauge;
 Maximum speed: 80 kph;
 32.5 tonnes per axle.
 Region that produces grain, iron ore and
gypsum.
MACEIÓ
Porto de Jaraguá
(15.4 million ha)
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Project’s Characteristics
 1,728 km of extension;
 25 work fronts;
 10,000 jobs generated (rising to 12,000);
 Potential creation of 500,000 direct and indirect jobs during the project;
 Approximately 1,200 heavy machines operating;
 Construction of the world’s largest factory of concrete wide-gauge rail ties, with a
capacity of 4,800 parts per day;
 13 km of bridges built, equivalent to a Rio—Niterói bridge;
 170,000 tonnes of track in stock, equivalent to 4,100 km, more than the distance
between São Paulo and Manaus;
 16 million cubic meters of rock moved;
 46 hectares in the Salgueiro’s industrial site, equivalent to 63 soccer fields;
 Investment of R$2.9 million per km.
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Main Clients
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Project’s Progress
PECÉM
Itapiúna
Quixadá
Piquet
Carneiro
Acopiara
 Estimated date of project
completion: December 2012.
Aurora
50km
TRINDADE
MISSÃO VELHA
São José
do
Belmonte
RECIFE
ELISEU
MARTINS
SUAPE
Cabo
SALGUEIRO
PORTO
REAL DO
COLÉGIO
Works under way
Works not yet under way
In hiring process
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Productivity
Current Operation
Future Operation
2.0 million
30 million
Railcars per train
35
104
Tonnes per axle
18
32,5
1,200
4,400
1,300 TKU/hp
15,000 TKU/hp
16 liters/’000 TKU
4.4 liters/’000 TKU
18.5
60
Capacity(tonnes/year)
Locomotives (hp)
Locomotives (productivity)
Fuel consumption
Cruising speed (kph)
8
Transnordestina
170,000 tonnes of track purchased by the end of July
9
Transnordestina
Salgueiro to Missão Velha - Special Works –
47-meter-high and 167-meter-long bridge
over the Jardim River, Ceará
10
Transnordestina
Special Works: 68-meter-long, 6-meter-wide and 10-meter-high
tunnel in Ceará
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Transnordestina
Eliseu Martins – Trindade Stretch
12
Transnordestina
Eliseu Martins – Trindade Stretch
13
Transnordestina
Salgueiro – Port of Suape Stretch
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Transnordestina
Salgueiro – Port of Suape Stretch
Bridge Over Formiga River
15
Transnordestina
Salgueiro – Port of Suape Stretch
Bridge Over Formiga River
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Transnordestina
Salgueiro – Port of Suape Stretch
Special Works - Culvert
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Transnordestina
Industrial Site of Salgueiro
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Transnordestina
Rail Tie Factory
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Transnordestina
Cabo Porto/PE to Real do Colégio/AL
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Northeast Region - Demand
Agriculture
State
Open
Area
Potential
area of
occupation
Estimated production
for rail transport
Piauí
306
1,528
60-70%
Maranhão
387
2,613
30-35%
Bahia
1,185
1,815
35-40%
Source: Campo – Consultoria e Agronegócios
Mining
 Several mines located in the states of Pernambuco, Piauí and Ceará,
including:
 Araripe Gypsum Complex
 Gypsum with up to 95% of purity in northeast Pernambuco
 Production (2007) – 4.4 Mt
 Estimated Reserves (2007) – 1,220 Mt
 Estimated 30%-40% reduction in the cost with rail transport
 Increase in international demand due to depletion of reserves in other countries
 Iron ore in Piauí
 Discovery of a high-quality iron ore mine in Piauí, with estimated reserves of 2.97
billion tonnes
 The Piauí of Transnordestina stretch will be implanted 20 km away from the mine
Source: Sindugesso and State Government of Piauí
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The Market’s Growth Potential
Production Growth (million tonnes)
40
35
30
25
20
15
10
5
0
2012
2013
2014
2015
Iron Ore
2016
Grain
2017
2018
Plaster
2019
Fruit
2020
2021
Oil Products
2022
2023
Fertilizer
2024
2025
2026
2027
Ethanol
Source: Campo – Consultoria e Agronegócios
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Ports
Suape - PE
Pecém - CE
 Privileged location in the center of the
Northeast region, with easy access to foreign
ports;
 Port with the smallest transit time between
Brazil, the USA and Europe ;
 70 companies installed or in the process of
being installed;
 1.9 million tonnes handled in 2009;
 7.7 million tonnes handled in 2009;
 Exports more fruit than any other Brazilian
port;
 Transnordestina will operate a site in the port
for future facilities in Suape and Pecem.
 The first iron ore shipment in the state of
Ceará through the TLSA rail network.
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Competitive Advantages
Competitive Advantages
Transnordestina’s Status
Licenses
All stretches have an installation license
Logistics Complex
Straight and flat route, with access to 7 ports
Currency Risk
Funding, investment, revenue and debt in Reais
Execution Risk
Concession, environmental licenses and appropriations in advanced
stage
Project Feasibility
Strong demand for agricultural products and minerals in a region with
poor logistics infrastructure
Competition
Monopolistic concession
Conflict of Interest
Revenue does not depend on associated companies
Client Portfolio
Some transportation agreements have already been signed
Funding
Large volume of financing from government bodies
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Funding
Funding Structure
Funding
R$ Billion
Share (%)
Equity
2.3
43.2
CSN
1.3
25.0
Federal Government
0.2
3.0
FINOR*
0.8
15.2
Dívida
3.1
56.8
FDNE
2.7
49.3
BNDES - TLSA
0.2
4.2
BNB/FNE
0.2
3.3
Future Capital Structure
* The ratio between CSN and federal government participation in
relation to FINOR will take place during the project. At the end of the
project it should be 50%/50%.
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CAPEX
Estimated CAPEX (R$ billion)
2.20
1.30
1.10
2010
2011
2012
0.03
0.02
0.04
0.05
0.02
2013
2014
2015
2016
2017
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Projections
Base Scenario
2012
2013
2014
2015
2016
2017
2018
3.1
8.1
15.6
19.5
22.7
24.8
28.0
Main Cargo
3.0
7.7
14.6
18.3
21.5
23.6
26.8
Return Cargo
0.1
0.4
1.0
1.5
1.2
1.2
1.2
Productivity
(in billion RTK)
3.0
7.7
15.2
19.1
21.9
23.7
26.5
Gross Revenue (R$ billion)
0.2
0.5
0.9
1.2
1.4
1.5
1.6
Volume
(in million tonnes)
Projected IRR
Between 13% and 14%
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Visit our website:
www.csn.com.br/ri
Investor Relations:
(55 11) 3049-7588 / 3049-7598 / 3049-7592 / 3049-7526
[email protected]
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