2. Second Quarter 2007
August, 2007
DISCLAIMER
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.
2
3. Second Quarter 2007
August, 2007
2Q07 HIGHLIGHTS
Consolidated net operating revenue of R$ 319.0 million, 3.5% decrease over 2Q06.
EBITDA(*) of R$ 36.4 million, 37.5% decrease over 2Q06.
Net income of R$ 13.9 million, 49.7% lower than 2Q06.
Net bank debt of R$ 164.0 million (R$ 180.6 million in 2Q06), or 1.2x LTM EBITDA(*)
(0.9x no 2Q06).
Note: Positive non recurring effect of R$ 12.8 million in 2Q06 and 1H06, due to favorable
court decision in tax litigation (Confins).
(*) 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.
3
4. Second Quarter 2007
August, 2007
2Q07 – MAIN FACTORS
Strong reduction of railway freight car demand.
Reduction of the North-American demand for railway castings.
Growth of the Brazilian production of trucks and agricultural machinery.
Impact of the real appreciation (1.9630 – 2Q07 x 2.1847 – 2Q06) on exports (R$ 7.3
million).
4
5. Second Quarter 2007
August, 2007
CORPORATE STRUCTURE
Iochpe-Maxion S.A.
Iochpe-
50% 100%
Amsted-Maxion Fundição e
Amsted- Maxion Sistemas Automotivos
Equipamentos Ferroviários S.A. Ltda.
Wheels and Frame Division Automotive Component
Railway Equipment
Division
Autoparts for passenger cars:
9%1
Railway freight cars: 6%1 Frame: 41%1
Castings 11%1 and wheels 3%1 Wheels: 31%1
1 % of consolidated net revenues in the second quarter of 2007 5
15. Second Quarter 2007
August, 2007
NET OPERATING REVENUE – 1H07
R$ 605 million
Segment (%) Customer (%)
Commercial Vehicle Daimler
Wheels(2) Chrysler
General Motors
14%
30% 6% Scania
Volkswagen
16%
6%
Tratctors
40% 7%
Chassis(2) Ford
6% Freight 4%
Railcars(1) 3% MRS
22%
11%
Exports
9% 22%
3% Castings(1)
Railway Automotive Comp. Others
Wheels(1)
(1) Amsted Maxion
(2) Wheels and Frames Division of Maxion Sistemas Automotivos 15
16. Second Quarter 2007
August, 2007
NET OPERATING REVENUE – 1H07
Net operating revenue in 2Q07
= 32% Decrease of 3.5% over 2Q06
02 – 06
R This performance is due to:
CAG 06-0
5=
(17% Reduction of domestic demand for railway
)
freight cars
Reduction of USA demand for railway castings
Impact of Real appreciation on exports
Increase of Brazilian trucks and Agriculture
machinery production
1H 07 – 0
6 = (10%
)
1,494
2Q 07 – 0
1,248 6 = (4%)
1,099
676 671
605
411
330 319
2002 2003 2004 2005 2006 1H06 1H07 2Q06 2Q07
16
17. Second Quarter 2007
August, 2007
EXPORTS – 1H07
US$ 64 million*
R$ 129 million
Segment (%) Destination (%)
Railway and
Industrial Castings
55% Latin
USA America
51% 26%
30% Commercial
Vehicles
Wheels
8%
Europe
15% 6% 10%
Canadá/ África/
Chassis México Middle East
(*) In 1H06 US$56 million, equivalent to R$ 121 million
17
21. Second Quarter 2007
August, 2007
EARNINGS BEFORE INTEREST AND TAXES - EBIT
R$ MM % Net Sales
200 20%
16%
150 15%
13%
12% 12%
11%
100 9% 9% 10%
178 10%
9%
136
127
50 5%
90
58 58 52
36
29
0 0%
2002 2003 2004 2005 2006 1H06* 1H07 2Q06* 2Q07
(*) 2Q06 and 1H06 include R$12.8 million of non recurrent results, or 320 basis points of EBIT margin on 2Q06 and 160 basis points on1H06
21
22. Second Quarter 2007
August, 2007
EBITDA (*)
R$ MM % Net Sales
250 20%
18%
200 17%
15%
15%
14% 14%
150 13% 13%
12%
11%
10%
100 205
156 163
5%
50 103
89
69 73
58
36
0 0%
2002 2003 2004 2005 2006 1H06** 1H07 2Q06** 2Q07
(*) 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.
(**) 2Q06 and 1H06 include R$12.8 million of non recurrent results, or 320 basis points of EBIT margin on 2Q06 and 160 basis points on1H06 22
24. Second Quarter 2007
August, 2007
NET INCOME
R$ MM % Net Sales.
80 20%
60 15%
72
40 58 8% 10%
51 43
6%
5% 5% 5%
4% 4%
20 5%
28
25
14
-1%
0 0%
(5)
(24)
(20) -6% -5%
(40) -10%
2002 2003 2004 2005 2006 1H06* 1H07 2Q06* 2Q07
(*) 2Q06 and 1H06 include R$12.8 million of non recurrent results
24
25. Second Quarter 2007
August, 2007
NET BANK DEBT
R$ MM x EBITDA (*)
200 2.0
175
150 1.5 1.5
1.3 1.2
125
100 0.9 1.0
0.8
75 0.6 181 164
0.6
115 132
50 106 102 0.5
125
25
0 0.0
2002 2003 2004 2005 2006 1H06 1H07
(*) 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
25
26. Second Quarter 2007
August, 2007
INDEBTEDNESS – jun/07 (R$ million)
SHORT LONG
LINES TOTAL
TERM TERM
Trade Finance / Export 10.0 29.4 39.4
Equipment Finance / EXIM 73.4 97.7 171.1
83.4 127.1 210.5
(-) Cash and Marketable Securities 46.5 46.5
Net Debt 37.0 127.1 164.1
Debt Indexation
86% Average Cost (jun/07)
Index by TJLP, CDI e IGPM
in R$ 78% CDI
1% Index by Dólar
13% 8,6% a.a.
in US$
TJLP Dólar IGP-M
26
28. Second Quarter 2007
August, 2007
2007 / 2008 OUTLOOK
Strong domestic demand for trucks and agriculture machinery
Recovery of domestic railway freight car market from the end of 2007, onwards
Implementation of commercial vehicle wheels plant in China
28
29. Second Quarter 2007
August, 2007
Speech in the ceremony of the new Maxion plant in China (Nantong)
29