2. Forward Looking Statement
•This presentation includes forward-looking statements or statements about events or
circumstances which have not occurred. We have based these forward-looking
statements largely on our current expectations and projections about future events
and financial trends affecting our business and our future financial performance.
These forward-looking statements are subject to risks, uncertainties and
assumptions, including, among other things: general economic, political and business
conditions, both in Brazil and in our market. The words “believes,” “may,” “will,”
“estimates,” “continues,” “anticipates,” “intends,” “expects” and similar words are
intended to identify forward-looking statements. We undertake no obligations to
update publicly or revise any forward-looking statements because of new information,
future events or other factors. In light of these risks and uncertainties, the forward-
looking events and circumstances discussed in this presentation might not occur. Our
actual results could differ substantially from those anticipated in our forward-looking
statements.
THE INFORMATION CONTAINED HEREIN IS PROPERTY OF EMBRAER AND SHALL NOT BE COPIED OR DISSEMINATED WITHOUT EMBRAER’S WRITTEN CONSENT
3. Highlights 2Q06
• On June 5, Embraer concluded its
restructuring process and started
to be listed on the Novo Mercado
segment of the BOVESPA
• On May 2, Embraer introduced
the Lineage 1000, an ultra-large
business jet based on the
EMBRAER 190 commercial jet
platform.
THE INFORMATION CONTAINED HEREIN IS PROPERTY OF EMBRAER AND SHALL NOT BE COPIED OR DISSEMINATED WITHOUT EMBRAER’S WRITTEN CONSENT
4. Highlights 2Q06
• JetBird acquired 50 firm Phenom 100 jets and placed an option for an additional
50 aircraft.
• The EMBRAER 195 airliner, the largest of the EMBRAER 170/190 family,
received in June type certification from the National Civil Aviation Agency
(ANAC), the Brazilian certification authority.
• Copa Airlines exercised three options for the EMBRAER 190 increasing the
number of firm E-Jets in its orderbook to 15.
• Embraer reached an agreement with Kawasaki Heavy Industries Ltd. to begin
assembling the wings of the EMBRAER 190 and EMBRAER 195 aircraft.
• Firm orders for the recently launched Phenom 100 and Phenom 300 reached
more than 235 units at the end of the quarter. The total backlog for the executive
aviation segment reached US$1.25 billion.
THE INFORMATION CONTAINED HEREIN IS PROPERTY OF EMBRAER AND SHALL NOT BE COPIED OR DISSEMINATED WITHOUT EMBRAER’S WRITTEN CONSENT
5. Results &
Performance
THE INFORMATION CONTAINED HEREIN IS PROPERTY OF EMBRAER AND SHALL NOT BE COPIED OR DISSEMINATED WITHOUT EMBRAER’S WRITTEN CONSENT
6. Jet Deliveries
41 40
36
30
27
2Q05 3Q05 4Q05 1Q06 2Q06
THE INFORMATION CONTAINED HEREIN IS PROPERTY OF EMBRAER AND SHALL NOT BE COPIED OR DISSEMINATED WITHOUT EMBRAER’S WRITTEN CONSENT
7. Net Revenues and Gross Margin
US$ Million
31.4%
28.1% 28.2% 28.7% 28.2%
1,190
1,064
1,021
812 808
2Q05 3Q05 4Q05 1Q06 2Q06
THE INFORMATION CONTAINED HEREIN IS PROPERTY OF EMBRAER AND SHALL NOT BE COPIED OR DISSEMINATED WITHOUT EMBRAER’S WRITTEN CONSENT
8. Net Revenue by Segment
2Q05 2Q06
$812 Million $1,021 Million
Customer
Services and Customer
Others 12% Services and
Executive Others 13%
Executive
Aviation 7%
Aviation 9%
Commercial
Defense and Defense and Aviation 72%
Government Government
15% 6%
Commercial
Aviation 66%
THE INFORMATION CONTAINED HEREIN IS PROPERTY OF EMBRAER AND SHALL NOT BE COPIED OR DISSEMINATED WITHOUT EMBRAER’S WRITTEN CONSENT
9. Income from Operations
US$ Million
15.7%
13.2%
12.2%
9.6%
167
135
114 4.5%
99
37
2Q05 3Q05 4Q05 1Q06 2Q06
THE INFORMATION CONTAINED HEREIN IS PROPERTY OF EMBRAER AND SHALL NOT BE COPIED OR DISSEMINATED WITHOUT EMBRAER’S WRITTEN CONSENT
10. Net Income
US$ Million
13.1% 13.6%
10.2%
10.4%
156
8.1% 139
110
83
65
2Q05 3Q05 4Q05 1Q06 2Q06
THE INFORMATION CONTAINED HEREIN IS PROPERTY OF EMBRAER AND SHALL NOT BE COPIED OR DISSEMINATED WITHOUT EMBRAER’S WRITTEN CONSENT
11. Accounts Receivable Breakdown
US$ Million
905
790
654
488
451 482 472
100 136 140
302 351 346 332
251
2Q05 3Q05 4Q05 1Q06 2Q06
Others Commercial Aviation
THE INFORMATION CONTAINED HEREIN IS PROPERTY OF EMBRAER AND SHALL NOT BE COPIED OR DISSEMINATED WITHOUT EMBRAER’S WRITTEN CONSENT
12. Inventories
US$ Million
1,736
1,648 1,639
1,601
1,511
2Q05 3Q05 4Q05 1Q06 2Q06
THE INFORMATION CONTAINED HEREIN IS PROPERTY OF EMBRAER AND SHALL NOT BE COPIED OR DISSEMINATED WITHOUT EMBRAER’S WRITTEN CONSENT
13. Net Cash (Debt) Position
US$ Million
527
360
302
97
-229
2Q05 3Q05 4Q05 1Q06 2Q06
THE INFORMATION CONTAINED HEREIN IS PROPERTY OF EMBRAER AND SHALL NOT BE COPIED OR DISSEMINATED WITHOUT EMBRAER’S WRITTEN CONSENT
14. Loans
Total Debt of US$ 1,528.6 Million
Brazilian
Currency
Short Term 22%
41%
Long Term Foreign
59% Currency
78%
• Average cost in R$ = 9.5 % p/a Long-Term Loan Average Maturity:
• Average cost in US$ =7.1 % p/a 2 years and 1 month
THE INFORMATION CONTAINED HEREIN IS PROPERTY OF EMBRAER AND SHALL NOT BE COPIED OR DISSEMINATED WITHOUT EMBRAER’S WRITTEN CONSENT
15. Loans Maturity
US$ million
634
1,529 160
284
199
252
Total Short-term 2007 2008 2009 Beyond
2010
THE INFORMATION CONTAINED HEREIN IS PROPERTY OF EMBRAER AND SHALL NOT BE COPIED OR DISSEMINATED WITHOUT EMBRAER’S WRITTEN CONSENT
16. Backlog and
Delivery Forecast
THE INFORMATION CONTAINED HEREIN IS PROPERTY OF EMBRAER AND SHALL NOT BE COPIED OR DISSEMINATED WITHOUT EMBRAER’S WRITTEN CONSENT
17. ERJ 145 Family Order Book
Firm
Firm Orders Options Total Deliveries Backlog
ERJ 135 108 2 110 108 -
ERJ 140 74 - 74 74 -
ERJ 145 682 157 839 676 6
Total 864 159 1,.023 858 6
(2nd Quarter 2006)
THE INFORMATION CONTAINED HEREIN IS PROPERTY OF EMBRAER AND SHALL NOT BE COPIED OR DISSEMINATED WITHOUT EMBRAER’S WRITTEN CONSENT
18. EMBRAER 170/190 Family Order Book
Firm
Firm Orders Options Total Deliveries
Backlog
EMBRAER 170 144 116 260 111 33
EMBRAER 175 22 - 22 19 3
EMBRAER 190 253 286 539 33 220
EMBRAER 195 36 40 76 - 36
Total 455 442 897 163 292
(2nd Quarter 2006)
THE INFORMATION CONTAINED HEREIN IS PROPERTY OF EMBRAER AND SHALL NOT BE COPIED OR DISSEMINATED WITHOUT EMBRAER’S WRITTEN CONSENT
19. Backlog
US$ Billion
14.7 15.0 15.3 15.9
13.6
10.9 10.4 10.4 10.4 10.2
2Q05 3Q05 4Q05 1Q06 2Q06
Firm Options
THE INFORMATION CONTAINED HEREIN IS PROPERTY OF EMBRAER AND SHALL NOT BE COPIED OR DISSEMINATED WITHOUT EMBRAER’S WRITTEN CONSENT
20. Jet Deliveries Forecast
160 161
148 145 150
141
131
96 101
59
1998 1999 2000 2001 2002 2003 2004 2005 2006E 2007E
THE INFORMATION CONTAINED HEREIN IS PROPERTY OF EMBRAER AND SHALL NOT BE COPIED OR DISSEMINATED WITHOUT EMBRAER’S WRITTEN CONSENT
