Friday, November 26, 2021
Vacation News for the USA

Localiza Hire a Automobile S A : Transcription 3Q21

Localiza Hire a Automobile 3Q21 Outcomes November 10, 2021 [Anna Branco]: Good afternoon, and welcome to the Localiza Hire a…

By Staff , in Car Rentals , at November 25, 2021

View deals on Tripadvisor

Localiza Hire a Automobile 3Q21 Outcomes

November 10, 2021

[Anna Branco]: Good afternoon, and welcome to the Localiza Hire a Automobile webinar referring to the outcomes for the third quarter of 2021. As we speak with us are Messrs. Rodrigo Tavares, CFO and Nora Lanari, Investor Relations Officer.

For individuals who want translation, the instrument is accessible within the platform. Please click on “interpretation button” utilizing the globe icon on the underside of the display screen and select your language of desire.

You may additionally select to mute or unmute the unique audio by clicking the “unmute unique audio” button.

Please be suggested that this webinar is being recorded and shall be made accessible on, the place the entire materials of our Earnings Launch is accessible. You can too obtain the presentation from the chat icon.

For the Q&A session for analysts and traders, we advise you to sign your curiosity in taking part, via the Q&A icon, on the underside button of your screens, indicating your NAME, INSTITUTION and LANGUAGE. When known as, a request to activate your microphone will seem on the display screen. For phone individuals, dial *9 (increase hand), as soon as your query is introduced, dial *6 to mute after which to unmute the audio.

To ship questions in writing through the Q&A icon, on the backside of your screens, we advise you to make them by indicating your NAME and COMPANY earlier than your query.

We inform you that the values of this presentation are in thousands and thousands of Reais and in IFRS. We emphasize that the knowledge contained on this presentation and any statements that could be made throughout the videoconference, concerning Localiza’s enterprise prospects, working and monetary projections and objectives, represent beliefs and assumptions of the Firm’s Administration, in addition to info presently accessible. Ahead-looking issues are usually not ensures of efficiency. They contain dangers, uncertainties and assumptions, as they check with future occasions and, subsequently, rely upon circumstances which will or might not happen. Buyers ought to perceive that basic financial circumstances, market circumstances and different working components might have an effect on the Firm’s future efficiency and result in outcomes that differ materially from these expressed in such forward-looking statements.

Now, I’ll hand the ground over to Rodrigo, the Firm’s CFO, to start the presentation.

[Rodrigo Tavares]: Good afternoon everybody and welcome to the Localiza outcomes webinar.

After the second wave of the pandemic, within the second quarter, we felt the constructive impact of the advance in vaccination, which contributed to the resumption of demand in all Automobile Rental segments. Even in a context of rising rental costs, which is very vital because of the improve within the worth of latest vehicles and upkeep prices, we have now observed a gradual and constant improve in our volumes – already larger than what we introduced in 1Q21 – with the utilization price again to historic ranges.


Will increase in automobile costs, in upkeep prices and within the primary rate of interest considerably impacted the whole mobility chain, however demand resilience reinforces the place of rental as an reasonably priced and viable transport choice for essentially the most various mobility wants.

The demand for long run rental, each from massive firms in addition to people and small and medium-sized firms, is presently sturdy, ensuing within the highest ever backlog.

We proceed to reside in a context of restricted vehicles’ provide, brought on by inadequate provide of inputs within the chain, particularly semiconductors. This situation as soon as once more impacted purchases within the quarter and it ought to final, with a perspective of normalization solely from the second half of subsequent yr.

On this context, we’re in search of a greater vehicles’ allocation by section, in keeping with the mileage and the wants of our prospects, thus managing to keep up the NPS at ranges of excellence, in addition to monetize the asset, with out dropping sight of our long-term relationships and buyer imaginative and prescient. On this means, we’re lowering the impression of the postponement of the fleet decommissioning till buy volumes return to larger ranges.

We proceed creating Localiza’s journey of digital transformation and constructing the way forward for sustainable mobility. Our technique to develop our competence in expertise and information science and to take a look at our ecosystem has been persistently evolving via Localiza Labs. We’ve got intensified our efforts within the pursue of innovation inside the buyer journey, environment friendly value administration and larger productiveness on a number of fronts, and we have already got some necessary initiatives within the experimentation and enlargement section.

We’re coming near 150,000 linked vehicles and, because of this, we have now a day by day era of round 65 million information factors and greater than 9 million kilometers monitored per thirty days, which, along with lowering delinquency charges, is a crucial instrument for theft discount and improve in price of restoration.

We stay diligent within the allocation of capital and can reap the benefits of the second to look much more broadly at new alternatives that may improve our enterprise, whether or not by strengthening our aggressive benefits, rising our progress or return prospects. Our steadiness sheet retains strengthening with substantial discount of leverage ratios. In addition to that, our fleet substitute value is the bottom within the trade, guaranteeing money preservation, basic whereas going via a interval of uncertainty and improve in rates of interest.

This quarter we concluded a technical examine that supported the evaluation of the helpful lifetime of our vehicles from a tax perspective, which accelerates depreciation and tax credit score, with a direct impression on outcomes. Based mostly on the technical report issued by a professional entity by the Brazilian Income Service, the fiscal helpful lifetime of the vehicles was diminished from 48 or 60 months to, on common, 24 months for the vehicles lined by the report. Consequently, we had a rise in tax depreciation and the popularity of the corresponding PIS/COFINS credit, impacting the quarter’s EBITDA by about R$320 million.

Lastly, on the final twelve months we reached a ROIC of 16.8% and unfold over debt after taxes of 13.9 proportion factors.

For the presentation of the outcomes, we are going to go to web page 2 of our Webcast.


In 3Q21, we present a progress of 54.1% in income from the automobile rental division yr over yr. The utilization price was 81.3% and the typical day by day price reached R$92.0, reflecting our pricing technique and the combination of segments.

Income from the Fleet Rental division has been rising sequentially and, year-over- yr, reveals a rise of 14.7% towards 3Q20, because of the mixed impact of quantity and costs, with a secure utilization price and a mean day by day price 8.4% larger.

On web page 3, we present the monetary highlights for 3Q21.

In comparison with the identical interval final yr, web income from Automobile Rental grew 43.3% and from Seminovos dropped 36.1%, impacted by decrease automobile decommissioning volumes, within the context of decrease purchases. Consequently, consolidated income decreases 9,6%. EBITDA grows 83.1% year-over-year, because of the larger working end result from each rental and Seminovos. EBIT advances 112.2% in the identical comparability. Lastly, we see a 106.3% improve in web revenue for the quarter, which reached 671.4 million, surpassing the two billion mark within the final twelve months.

To current the small print of the third quarter outcomes, I want to give the ground to our investor relations director, Nora Lanari.

[Nora Lanari]: Good afternoon, everybody.

Beginning with the Automobile Rental division, as you possibly can see on web page 4, within the third quarter the variety of day by day leases elevated by 11.0% and income grew by 54.1% yr over yr. Reflection of the volumes resumption from the vaccination towards Covid evolution and the upper degree of fleet utilization price. We additionally proceed to regulate our rental charges in all segments to accommodate new automobile worth will increase and better rates of interest. We see a resilient demand with constant progress in all segments, which reinforces our confidence in rental progress avenues for the approaching years.

On web page 5, we present the results of the environment friendly administration of costs and blend. Within the context of low automobile provide and rising demand, the Automobile Rental division reached a utilization price above 81% and a mean day by day price of R$92. The value improve course of ought to proceed within the upcoming months to rebalance return ranges, contemplating the substitute value of vehicles, upkeep prices and excessive rates of interest.

On web page 6, we present that the community of personal branches was expanded by 9 within the final 12 months, from 442 to 451, which reinforces our confidence in progress alternatives. The Firm has been rising comfort for its prospects and on the brink of speed up volumes as automobile supply returns to extra strong ranges.

Shifting on to web page 7, within the Fleet Administration division, we see the typical rented fleet elevated by 7.5% and web income elevated by 14.7% in comparison with 3Q20. On this comparability, charges have elevated by 8.4%, reaching R$1,753per month, per rented automobile and reflecting the pricing of latest contracts in a context of rising new automobile costs and rates of interest.

We’re enthusiastic about what we have now seen within the demand and outcomes of Localiza Meoo. The variety of orders continues to extend and Fleet Rental has a backlog of greater than 20,000 vehicles, however we’re nonetheless being impacted by the situation of restricted manufacturing of latest vehicles.


Shifting on to web page 8, we present the steadiness of vehicles bought and offered. The quarter was affected by lockdowns in Malaysia, which aggravated the semiconductors international disaster, leading to additional suspensions within the manufacturing of vehicles in Brazilian. On this context, we purchased 22,437 and diminished automobile decommissioning, which resulted within the sale of 21,620 vehicles, a rise of 817 vehicles between buy and sale and a web funding of R$327.5 million. Our common buy worth was R$72.7 thousand, in comparison with a gross sales worth of R$60.5 thousand, leading to a substitute effort of R$12.2 thousand per automobile, displaying the significance of sustaining self-discipline when shopping for vehicles.

On web page 9, we present the used automobile community, or Seminovos. On the finish of 3Q21, we had 132 factors of sale and had 21,620 vehicles offered, a discount of 52.5% in quantity offered year- over-year. The common worth was 34.5% larger than the costs charged in the identical interval of the prior yr and replicate the context of a pointy improve within the worth of the brand new automobile, which we have been in a position to seize in our decommissioning.

On web page 10 we present the fleet on the finish of 3Q in comparison with the prior yr. In Automobile Rental, we ended the quarter with a fleet of 207,550 vehicles, a discount of 4.1%. Whereas in Fleet Rental, the end-of-period fleet elevated 6.5%. On a consolidated foundation, the fleet decreased by 1.7%, reflecting the decrease variety of vehicles being activated and decommissioned, along with the decrease variety of autos accessible on the market.

Shifting on to web page 11, we see that the consolidated web income of the quarter drops 9.6% year-over-year. Internet rental revenues elevated by 43.3%, with a 54.1% improve within the automobile rental division and 14.7% in fleet rental, whereas Seminovos diminished 36.1%, impacted by the decrease vehicles decommissioning and gross sales quantity, partially compensated by larger costs.

On web page 12, we see that EBITDA grows 83.1% in 3Q21 yr over yr, reaching R$1,187 million, with a robust contribution from Automobile Rental and Used Autos.

The constructive efficiency in Automobile Rental is because of the improve in income, resulted from larger volumes and rise within the rental charges, along with the next margin, benefited by the larger recognition of PIS and COFINS credit, the results of a examine that culminated within the discount of the fiscal helpful lifetime of the vehicles object of the report issued. The common fiscal helpful life of those vehicles approached 24 months versus 48 months beforehand used for acquiring PIS/COFINS credit, which is to say that the credit score recovered from these vehicles virtually doubles. The larger credit score quantity ought to be recurring as we receive new stories updating the fiscal helpful life of latest vehicles getting into the fleet.

Regardless of the enlargement, some results nonetheless have a detrimental impression on the Automobile Rental EBITDA margin, particularly the upkeep line, property tax, licensing, and others, which stays excessive because the fleet age continues, will increase within the worth of vehicles and components and bigger theft recognition. One other line impacted was revenue sharing, reflecting larger elevated provision because of the sturdy results of the Firm. Lastly, margins have been impacted by continued investments within the model and within the expertise and information groups, getting ready the Firm for the subsequent progress cycle and a extra distinguished presence within the mobility ecosystem. These mixed results resulted in an advance of

22.4 p.p. within the Automobile Rental EBITDA margin.


Shifting on to the Fleet Rental division, the EBITDA margin decreased by 12.6 proportion factors, primarily because of the improve in upkeep prices because of the fleet growing old, along with improve in bills with staff, expertise and promoting for Localiza Meoo. Final yr´s foundation of comparability is powerful due to the decrease personnel value related to the MP 926, diminished upkeep value because of the decrease utilization of the fleet and diminished bills with advertising and consulting throughout the starting of the pandemic. Within the final quarter, we have now seen the order backlog improve, which ought to contribute to the gradual acceleration of progress and value dilution, as car deliveries advance.

The tailwind continues at Seminovos and contributes to the next EBITDA because of the sturdy enchancment in costs, even with much less quantity of vehicles offered. Within the annual comparability, the Seminovos margin goes from 6.3% in 3Q20 to 18.6% this quarter.

Consequently, the consolidated EBITDA margin reaches the extent of 80.9%.

On web page 13 we see that in RAC, the annualized common depreciation per automobile advances sequentially, to R$938. Within the Fleet Rental Division, the typical annual depreciation per automobile was R$ 975. The upper renewal of RAC vehicles in addition to the less vehicles offered, with an impression on the decrease dilution of mounted prices, clarify the advance in depreciation on this division. Anyhow, the depreciation at low ranges within the two enterprise divisions is a results of the rise in new vehicles and consequent impression on used automobile gross sales costs and tends to advance slowly whereas the tempo of fleet renewal stays low.

On web page 14, we are able to see that the consolidated EBIT in 3Q21 reached R$1,068.8 million, representing a rise of 112,2% year-over-year.

The EBIT margin of the Automobile Rental division was 72.7%, representing a rise of

31.9 proportion factors in comparison with 3Q20, primarily defined by the results that impacted EBITDA. Within the Fleet Rental division, the EBIT margin was 73.6%, a rise of 0.2 proportion factors yr over yr, primarily defined by the discount in depreciation and better margin on the sale of vehicles on this division.

Internet revenue for the quarter, on web page 15, grew 106.3% in comparison with 3Q20, reaching R$671.4 million. Along with the EBIT variation described above, monetary bills elevated 77.6%, particularly because of the improve within the CDI and revenue taxes, which elevated by 143.2% because of the larger EBT and better price.

On web page 16, we present a money consumption of R$208.8 million within the 9 months of 2021, defined primarily by the discount of R$851.3 million within the automakers account.

As will be seen on web page 17, web debt elevated by R$541.7 million, ending the quarter at R$6.7 billion.

On web page 18, we are able to see that we ended the quarter with a robust debt profile and robust money place. Together with the difficulty of R$2 billion in debentures made in October, within the professional forma evaluation, the Firm has virtually R$5.5 billion in money. The chart beneath reveals the fee construction of our debt. Additionally contemplating the professional forma evaluation, of the whole gross debt, about 16% are pre-fixed, from safety through derivatives, guaranteeing the profitability contracted within the Fleet Rental division. One other 28% are listed to 109.4% of CDI and the remaining 56% are listed to CDI + 1.68%. Moreover, as a mitigator for the speed improve, the supply of money is totally utilized to % of the CDI, which helps to guard the Firm from the rise in rates of interest. The environment friendly administration


That is an excerpt of the unique content material. To proceed studying it, entry the unique doc right here.


Localiza Hire a Automobile SA printed this content material on 25 November 2021 and is solely accountable for the knowledge contained therein. Distributed by Public, unedited and unaltered, on 25 November 2021 22:59:05 UTC.

Source link