Presentation - 2006 Results

1. www.duratex.com.br 2006 Year End Results
1 February / 07

2. >> Record Performance in 2006
Highlights
Highlights
Shipped volumes increased by 17% in the Wood Division and
by 9% in the Deca Division;
Record Net Revenues totaled R$ 1,5 billion, 17% over the one
for 2005;
Record EBITDA of R$ 458,1 million, which corresponds to an
EBITDA margin of 31%;
Record Net Income of R$ 226,0 million, equal to a R$ 1,78 profit
per share, which is 65% more than 2005;
Preferred stock trading daily average volume registered
R$ 8,2 million;
Market Capitalization reached R$ 4,2 billion at the end of 2006.
2

3. >> Business Segments
Wood Division
Hardboard
Particle Board
MDF/HDF/SDF
Laminate Flooring
3

4. >> Business Segments
Deca Division
Metal Fittings
Vitreous China
Accessories
4

5. >> Capital Expenditures
CAPEX (in R$ M)
303,5
172,8
136,8
108,4 105,4
2002 2003 2004 2005 2006
5

6. >> Capital Structure (in R$ M)
in R$ M dec-06
Total Debt 618
Cash and Cash Equivalents 575
Shareholder´s Equity 1.396
Net Debt / Shareholder´s Equity 3,1%
Net Debt / EBITDA 0,10
618,2
Debt and amortization Foreign 82,1
Currency
schedule
359,4
Domestic 536,1
Currency 98,8
76,5
56,2 27,3
Total Debt 2007 2008 2009 2010 2011 &
After
6

7. >> Industrial Capacity
Nominal capacity and occupancy rate
95% 360.000 m3/year
Hardboard 360.000 m3/year
Particle Board 76% 500.000 m3/year
500.000 m3/year
640.000 m3/year
640.000 m3/year
MDF/HDF/SDF 91%
14.400 KK
14.400
Metal Fittings 74% pieces/year
pieces/year
3.800 KK
3.800
Vitreous China 82% pieces/year
pieces/year
7

8. >> Wood Panels Sector
Furniture industry
Consumes approximately 60% of Duratex made wood panels;
The industry is constituted of more than 16 thousand companies;
There are 7 main furniture poles:
• Bento Gonçalves (RS),
• São Bento do Sul (SC),
MG
• Arapongas (PR),
ES
SP
• Big São Paulo (SP),
PR
• Norwest region of São Paulo (SP)
SC
• Ubá (MG) RS
• Linhares (ES) Furniture poles
8

9. >> Wood Panels Sector
Strategic positioning
Laminate
Hardboard Particle Board MDF/HDF SDF
Flooring
Standard Painted Standard LP FF Standard LP FF
Duratex
Berneck
Eucatex
Isdra
Masisa
Arauco
Satipel
Tafisa
9

10. >> Housing Segment
Brazilian scenario
In 2006, the sector is expected to account for 13% of the Brazilian GDP;
Estimated growth of the Civil Construction GDP:
2006 4,9%
2007 5,7%
Positive perspectives:
• Improving of the legal framework,
• Reduction of interest rates,
• Tax reduction IPI,
• Expansion of credit,
• Estimated growth of the youth Brazilian population,
• Capitalized companies: R$ 4 billion in primary stock issuings.
Source: IBGE and Banco Central
10

11. >> Housing Segment
Housing sector outlook
in R$ M
2005 2006 ** %
Net Revenues * 2.507,8 3.238,7 29%
VGV * 3.466,6 8.138,3 135%
* Selected Companies: Abyara, Brascan, Camargo Correa, Company, Cyrela, Gafisa, Klabin Segall,
Lopes, PDG Realty, Rodobens, Rossi Residencial e Tecnisa.
** 9m06 results annualized
Sources: Financial statements and offerings prospectus
11

12. >> Housing Segment
Construction average cycle )
u res
e a fixt
n in
s to ic ch es
lag c tr us ori
of
f ele g hing itreo ss
on ion an
d hin i n is n d v ce ture /
ati ct is tf Ac rni l i ng
t
ec corp
or tru ulic ck
fin gh als a
Li et iv e
ry
Fu ode
j le ns dra i l
Pro In Sa Co Hy Th (M De rem
12 months 5 months 3 months
5% 95%
12

13. >> Revenues within the Domestic Market
Wood Furniture Industry
59%
6%
3%
Civil Const. 7%
Retail Technical Sales 4% 91%
24% Others
6%
Home Centers 14%
19%
Retail
57%
Civil Construction 8%
11%
Wholesale 9%
78%
Others 4%
13

14. >> Performance
Net revenues breakdown (2006 )
Others
MDF / HDF / SDF 16%
27% Laminate
Floor Boards
6%
Furniture Makers
Particle
Board 37%
13%
R$1,5 bn Metal
Fittings
22%
Civil Construction
Hardboard 47%
Vitreous
21% China
11%
Market Segments
14

15. >> Performance
Quarterly highlights
Var. (% ) Var. (% )
Shipments 4Q06 3Q06 4Q05 4Q06 x 3Q06 4Q06 x 4Q05
Wood (in 1.000 m³) 329,1 346,0 275,3 -4,9% 19,5%
Deca (in 1.000 items) 3.821 3.628 3.390 5,3% 12,7%
in R$ M
Net Revenues 410,7 399,8 330,3 2,7% 24,4%
COGS (226,3) (225,8) (199,2) 0,2% 13,6%
Gross Profit 184,5 174,0 131,1 6,0% 40,7%
Gross Margin 45% 44% 40% - -
Operating result before fin. 105,2 111,3 64,7 -5,4% 62,6%
EBITDA 125,6 130,8 85,4 -4,0% 47,0%
EBITDA Margin 31% 33% 26% - -
Net Income 65,2 70,2 31,3 -7,1% 108,2%
ROE (annualized) 20% 23% 13% - -
15

16. >> Yearly Performance (in R$ M)
Net Revenues Ebitda & Margin
R +1
4%
R +21%
CAG CAG 29%
31%
27%
25%
23%
1.489 458
1.188 1.271
990 321 363
867
213 232
2002 2003 2004 2005 2006 2002 2003 2004 2005 2006
Net Income Equity & ROE
1%
3% CAGR +1 18%
R +3
CAG 13% 13%
8% 7%
226
1.396
125 137 990 1.051
905 937
72 64
2002 2003 2004 2005 2006 2002 2003 2004 2005 2006
16

17. >> Quarterly Performance (in R$ M)
Net Revenues Ebitda & Margin
R +1
3%
R +20%
CAG CAG 31%
25% 26%
24% 24%
411 126
305 330
248 279 85
61 68 74
4Q02 4Q03 4Q04 4Q05 4Q06 4Q02 4Q03 4Q04 4Q05 4Q06
Net Income Equity & ROE
1%
5% CAGR +1 20%
R +3
CAG
14% 13%
9% 10%
65
1.396
33 905 937 990 1.051
31
20 23
4Q02 4Q03 4Q04 4Q05 4Q06 4Q02 4Q03 4Q04 4Q05 4Q06
17

18. >> Yearly Performance
Ebitda (in R$ M) & Margin (%) Wood
35%
32% 31%
29%
27% Demanded markets;
354 Increase of shipped volumes;
256 267
166 178 Export revenues reduction.
2002 2003 2004 2005 2006
23%
21%
16% 16% 17%
Positive scenario for the housing segment;
Increase of shipped volumes (Basics); 96 104
55 65
47
Cost increase at metal fittings segment.
2002 2003 2004 2005 2006
18

19. >> Quarterly Performance
Ebitda (in R$ M) & Margin (%) Wood
36%
29% 30% 29% 30%
Demanded markets;
99
Increase of shipped volumes;
59 68
47 56 Economies of scale.
4Q02 4Q03 4Q04 4Q05 4Q06
19%
16% 17%
15%
13%
Positive scenario for the housing segment;
Enrichment of the sales mix; 27
15 18
14 12
Economies of scale.
4Q02 4Q03 4Q04 4Q05 4Q06
19

20. >> Yearly Performance
Net Revenues per employee (in R$ 1.000)
%
GR : +13
CA 245,1
215,7
199,7
169,8
150,4
2002 2003 2004 2005 2006
20

21. >> Yearly Performance
EBITDA per employee (in R$ 1.000)
%
GR : +19 75,4
CA
61,6
53,9
37,0 39,8
2002 2003 2004 2005 2006
21

22. >> Performance
Cash Flow in 2006 (in R$ M)
372,1 195,8
574,6
(24,8) (20,4)
Working Financing
Capital
(105,4)
CAPEX
(76,7) Issuing of
new stock
Dividends and
profit sharing
234,0
Adjusted Net
Income (*)
Opening Balance Closing Balance
Dec. 05 Dec. 06
( * ) Adjusted Net Income = net Income + depreciation + financial result + provision and asset write offs
22

23. >> Capital Markets
Shareholders’ structure (as of Jan/2007)
Outstanding number of shares: 128.1 M
Common 53,3 M
Preferred 74,8 M Shareholders
Breakdown
Foreign Investors
51,5%
PN
Others
29,9%
Pension
Funds
10,5% Itaúsa / Itaúcorp
8,1%
23

24. 24
0
2.500
5.000
7.500
10.000
12.500
15.000
17.500
20.000
22.500
25.000
27.500
30.000
30/12/2004
14/1/2005
31/1/2005
16/2/2005
2/3/2005 (in R$ 1.000)
Financial Volume
16/3/2005
31/3/2005
14/4/2005
29/4/2005
Adhesion to
Bovespa´s Level I
Stock Split
(200x1)
13/5/2005
30/5/2005
13/6/2005
27/6/2005
11/7/2005
2005
25/7/2005
8/8/2005
Honourable Reference
22/8/2005
IR Magazine
5/9/2005
20/9/2005
4/10/2005
19/10/2005
3/11/2005
>> Capital Markets
18/11/2005
2/12/2005
16/12/2005
2/1/2006
16/1/2006
31/1/2006
14/2/2006
2/3/2006
16/3/2006
Stock Dividend
Stock Public Offering
30/3/2006
13/4/2006
Election of an Independent
2/5/2006
Board Member
16/05/06
30/05/06
13/06/06
28/06/06
2006
12/07/06
26/07/06
9/8/2006
23/8/2006
6/9/2006
21/9/2006
05/10/06
20/10/06
6/11/2006
22/11/2006
Annual Report
3rd Place – ABRASCA Award
6/12/2006
20/12/2006
8/1/2007
22/1/2007
Price (R$)
07
as of 05/Feb/07
8,00
10,00
12,00
14,00
16,00
18,00
20,00
22,00
24,00
26,00
28,00
30,00
32,00
34,00
36,00
38,00
40,00
42,00
44,00
46,00
48,00

25. >> Capital Markets
Market capitalization at year end
US$ 1.969 M
R$ 4.209 M
4.209
+2 1%
GR:
CA
+ 3 0%
GR:
CA
1.743
US$ 362 M 1.460
970
661 558 605
R$ 403 M 288
403 468
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006
25

26. >> Capital Markets
Dividends (in R$ M)
76,9
%
: +20 58,1
CA GR 15,3
46,3
42,8
23,6 24,6 25,7
21,5
14,7 15,0 15,2
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006
Extraordinary dividend
26

27. >> Wrap up
CAPEX: Capital´s Structure:
• consistent programs, •presence in capital markets,
• returns / ROIC. • low leverage.
CREATION
OF VALUE WITH
Market Positioning: SUSTAINABILITY
Low Cost
• strong brand names,
of
• products and markets,
Wood Supply
• distribution channels,
27

28. www.duratex.com.br 2006 Year End Results
28 February / 07