11ª Conferência Anual - Santander (inglês)

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Localiza Rent a Car S.A.11th Annual Latin America Conference - Santander

1

Integrated Business Platform

Synergies:

cost reduction,

cross selling,

bargaining power

179 agencies in 8 countries6,816 cars

23 points of sales79% directly sold to consumers

133 agencies25,138 cars

14,250 cars

2

Cor

e B

usin

esse

sSu

ppor

tIncrease market leadership maintaining high return on investment

Create value through fleet management market opportunities, taking advantage of the synergies generated by the integrated business platform

Add value to the brand by expanding the network in Brazil and South America

Add value to the businesses of the platform as a competitive advantage, reducing depreciation costs

Strategy by segment

3

Revenue per car sold** 102,20SG&A (7%) (7,15)Safety Margin (3%) (3,06) Book value after 12 months 91,99

Car rental financial cycle

115Financial payment

Financing

100

Car Sales Revenue

102

** Depreciation over list price: 100-(102.2/125)x100 = 18,2%

100Car acquisition

(List price net of dealers discount = 125)

Holding cost of cars after tax with 3% margin = depreciation + financial cost.Either the leverage is through third party financing or shareholder’s capital.

Principal 100,00Interest (CDI + 1 p.p.) 15,00Financial payment 115,00

Depreciation = estimated price of selling after one year, net of SG&A and safety margin minus price of purchase. Depreciation rate: 100-(102.2*0.9) = 8.02%

4



Financing

100

Car Sales Revenue

102

Revenues = 114,58

Expenses = 62,84

100Car acquisition


* Car analysis of LTM over the average price of cars purchased of the previous year.

*R$ %

Car rental revenue 114,58 100,0%Costs (46,00) -40,1%SG&A (16,84) -14,7%

EBITDA 51,75 45,2%

Tax (30%) (15,52) -13,5%NET INCOME 36,22 31,6%

% over car rental revenue

Car Rental

31,6%

*EBITDA margin of 45.2% reflects high fixed cost and the utilization rate between 65% and 70%.

Net margin of 31,6% necessary to cover car holding cost.




5



Financing

100

Car Sales Revenue

102

Revenues = 114,58

Expenses = 62,84

100Car acquisition


* Car analysis of LTM over the average price of cars purchased of the previous year.

R$ % R$ %

Car rental revenue 114,58 100,0% 102,20 100,0%Costs (46,00) -40,1%SG&A (16,84) -14,7% (7,15)Book value of car resale (91,99) -90,0%

EBITDA 51,75 45,2% 3,06 3,0%Depreciation (8,20) -8,0%Interest (15,00) -14,7%Tax (30%) (15,52) -13,5% 6,04 5,9%

NET INCOME 36,22 31,6% (14,10) -13,8%% over car rental revenue

Car Rental Car Resale (Seminovos)

31,6% -12,3%

*

Car holding cost is 12.3%of car rental revenues.




6



Financing

100

Car Sales Revenue

102

Revenues = 114,58

Expenses = 62,84

100Car acquisition


*

Consolidated net margin is 19,3% of car rental revenues (if 100% leveraged).

R$ % R$ % R$ %

Car rental revenue 114,58 100,0% 102,20 100,0% 216,78 100,0%Costs (46,00) -40,1% (46,00)SG&A (16,84) -14,7% (7,15) (23,99)Book value of car resale (91,99) -90,0% (91,99) -3,8%

EBITDA 51,75 45,2% 3,06 3,0% 54,81 25,3%Depreciation (8,20) -8,0% (8,20) -3,8%Interest (15,00) -14,7% (15,00) -6,9%Tax (30%) (15,52) -13,5% 6,04 5,9% (9,48) -4,4%

NET INCOME 36,22 31,6% (14,10) -13,8% 22,12 10,2%% over car rental revenue

Car Rental Car Resale (Seminovos) Consolidated

31,6% -12,3% 19,3%




7

Fleet rental financial cycle

Financing

100


100Car acquisition


Car Sales Revenue

102

Holding cost of fleet cars after tax with 3% margin = depreciation + financial cost.Either the leverage is through third party financing or shareholder’s capital.

Depreciation = estimated price of selling after one year, net of SG&A and safety margin minus price of purchase. Depreciation rate: 100-(102.2*0.9) = 8.02%




8


Financing

100


100Car acquisition


Revenues = 53,64

Car Sales Revenue

102

Expenses = 18,21

* Car analysis of LTM over the average price of cars purchased of two years before.

*R$ %

Fleet rental Revenue 53,64 100,0%Costs (14,24) -26,5%SG&A (3,97) -7,4%

EBITDA 35,43 66,0%

Tax (30%) (10,63) -19,8%NET INCOME 24,80 46,2%

% over fleet rental revenue

Fleet Rental

46,2%

EBITDA margin of 66% reflects lower fixed costs and utilization rates around 97%.

Net margin of 46.2% necessary to cover fleet holding cost higher than car rental.




*

9


Financing

100


100Car acquisition


Revenues = 53,64

*

Car Sales Revenue

102

Expenses = 18,21

* Car analysis of LTM over the average price of cars purchased of two years before.

R$ % R$ %

Fleet rental Revenue 53,64 100,0% 102,20 100,0%Costs (14,24) -26,5%SG&A (3,97) -7,4% (7,15)Book value of car resale (91,99) -90,0%

EBITDA 35,43 66,0% 3,06 3,0%Depreciation (8,20) -8,0%Interest (15,00) -14,7%Tax (30%) (10,63) -19,8% 6,04 5,9%

NET INCOME 24,80 46,2% (14,10) -13,8%% over fleet rental revenue

Fleet Rental Car Resale (Seminovos)

46,2% -26,3%

Car holding cost is the same as in the car rental (R$14.1) but represents 26.3% of fleet rental revenues.




*

10

R$ % R$ % R$ %

Fleet rental Revenue 53,64 100,0% 102,20 100,0% 155,84 100,0%Costs (14,24) -26,5% (14,24) -9,1%SG&A (3,97) -7,4% (7,15) (11,12) -7,1%Book value of car resale (91,99) -90,0% (91,99) -59,0%

EBITDA 35,43 66,0% 3,06 3,0% 38,49 24,7%Depreciation (8,20) -8,0% (8,20) -5,3%Interest (15,00) -14,7% (15,00) -9,6%Tax (30%) (10,63) -19,8% 6,04 5,9% (4,59) -2,9%

NET INCOME 24,80 46,2% (14,10) -13,8% 10,70 6,9%% over fleet rental revenue

Fleet Rental Car Resale (Seminovos) Consolidated

46,2% -26,3% 20,0%


Financing

100


100Car acquisition


Revenues = 53,64

Car Sales Revenue

102

Expenses = 18,21

Consolidated net margin is 20% of fleet rental revenues (if 100% leveraged).




*

11

Growth opportunities

Air traffic

GDP elasticity

Consolidation

Credit cards

Replacement

Fleet outsorcing

12

Bargainingpower

Highercompetitiveness

Market shareexpansion

Scale gainsIntegrated platform

Geographical distributionYield managementBargaining power

Credit with lower interest rateKnow-how

DepreciationStrong brand

IT

Competitive advantages

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(R$ million, USGAAP)

EBITDA Margin per Segment

2003 2004 2005 3Q05 3Q06Margin Margin Margin Margin Margin

Rentals 34.3% 42.6% 46.3% 45.3% 44.5%

Used Cars Sales 9.7% 15.3% 14.4% 12.5% 2.7%

Rentals 61.2% 65.2% 63.6% 64.2% 70.1%

Used car sales 7.3% 8.2% 10.5% 7.9% 2.9%

Rentals 46% 51.5% 52.5% 52.1% 53.4%

Used car sales 9.2% 13.2% 13.7% 11.7% 2.8%

Franchising 43.6% 41.5% 47.6% 47.4% 47.4%

TOTAL 28.6% 33.1% 32.6% 31.1% 28.0%

Con

solid

ated

Flee

tRen

tal

Car

Ren

tal

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Economic Value Added (EVA)

2003 2004 2005 2006A Change

Average price per car R$ 16.4 19.5 23,4 *26.2 59.8%

IPCA (consumer inflation index) 9.3% 7.6% 5.7% *2.0% 26.9%

Average CDI (interbank rate) 23.3% 16.2% 19.0% 15.7% -7.6p.p.

Sovereign risk 8.4% 5.4% 4.0% 2.5% -5.9p.p.

Real WACC (excluding inflation) 14.3% 10.9% 10.5% 9.1% -5.2p.p.

Spread 0.6p.p. 10.8p.p. 8.3p.p. 9.1p.p. -

In the last 3 years the spread between ROIC and WACC has shown little volatilityIn the last 3 years the spread between ROIC and WACC has shown little volatility

R$ / thousand

* 9M06

1,781

44.486

57,384

82,736

12.0%

24.1%18.4%

15.8%

21.1%

24.1%29.3%24.6%

-

20,000

40,000

60,000

80,000

100,000

2003 2004 2005 20060.0%

10.0%

20.0%

30.0%

EVA Nominal WACC ROIC

15


Cash Flow

70.8

Cash and cashequivalents at thebeginning of 2006:

193.6

Cah and cashequivalents on

09/30/06

Operatingactivities

Cost ofused car sale

Investment activities include fleet (renewal: 14,861 cars and growth: 2,853)

Newacquisitions

281,7

-506,2

12,9

334,4

Other financingand investment

activities

16

251 303448

348 377288

493

690

402506

2003 2004 2005 9M05 9M06

Fleet Investment

Fleet Growth (thousand)Net Investment

Sold Cars Bought Cars

Investments - (R$ million. USGAAP) Quantity - thousand

2003 2004 2005 9M05 9M06

(R$ million. USGAAP)

37.4 46.3 47.7 38.1 47.2

- 143.8 194.1 16.1 81.537.4 190.1 241.8 54.2 128.7

-0.4 +6.2 +7.3 +0.6 +2.8

2003 2004 2005 9M05 9M06

Renewal

Growth

15.7

14.8

22.2

15.515.5 15.1 17.7

14.9

18.8

26.1

2003 2004 2005 9M05 9M06

Net: 129

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Net Debt (R$ million) USGAAP


Indebtedness Profile

S&P Rating - BrA / Positive outlook

2003 2004 2005 9M05 9M06

Net debt / fleet 22% 46% 60% 49% 34%

Net debt / equity 0.36 0.96 1.37 0.95 0.57

87

281

539349.3 351.3

2003 2004 2005 9M05 9M06

The Company is prepared for a new growth cycle.The Company is prepared for a new growth cycle.

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ROE – Return on Equity

NB: The 2006 figure was annualized based on the results of the first nine months, already considering the proceeds from the shares offering. ROE was arrived at by dividing net income by average shareholders’ equity for the year’, excluding net profit from the respective year.In 2003, the mark-to-market of derivative contracts was excluded from net income.

Localiza is ranked 13th, among the 500 largest companies in Brazil, in terms of ROE. (FGV ranking)

Localiza is ranked 13th, among the 500 largest companies in Brazil, in terms of ROE. (FGV ranking)

38.6% 38.9%36.7%

30.4%

2003 2004 2005 2006

Localiza awarded

•Best Company for Shareholders Capital Aberto Ranking (companies worth up to R$5 billion)

•Cases of corporate governance Brazilian Corporate Governancein family-owned companies Institute book

•13ª most profitable Company Conjuntura Econômica (FGV)

•467ª largest Company in Brazil Exame magazine

•Best car rental franchisee Pequenas empresas grandesnegócios magazine

•Best IR team in an IPO IR Magazine

•Brazil’s Top CEO Institutional Investor magazine

•Outstanding CEO Capital Aberto Magazine

•Administrator of the Year ANEFAC

•Best at Service Rendering Hoje em Dia newspaper

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-Nov

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-Feb

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20

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80

100

120

Vol

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R$

thou

sand

Performance - RENT3

Average daily trading volume in 2006 R$ 10,6 million

Performance: RENT3 2006 + 116% X IBOV 2006: + 30%

RENT3 X IBOV RENT3: +438%

IBOV: +80%

From 05/23/05 (IPO) to 12/15/06.

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Disclaimer – Information and Projections

The material that follows is a presentation of general background information about LOCALIZA 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 Securities Act of 1933 and Section 21E of the 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 LOCALIZA 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 LOCALIZA believes that the expectations and assumptions reflected in the forward-looking statements are reasonable based on information currently available to LOCALIZA’s management. LOCALIZA cannot guarantee future results or events. LOCALIZA expressly disclaims a duty to update any of the forward-looking statement.

It is not allowed to offer or sell in the United States securities not registered or exempted from registration. in accordance with the Securites Act of 1933. Any securities offering to be conducted in United States must be made through an offering memorandum. which can be obtained with the underwriters. The offering memo must contain or include reference to detailed information about LOCALIZA and its business and financial results. in addition to its financial statements.

This presentation does not constitute an offering. invitation or offering request or acquisition of any type of securities. Neither this presentation nor anything here included represent the terms of a contract or commitment of any kind.

The material that follows is a presentation of general background information about LOCALIZA 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 Securities Act of 1933 and Section 21E of the 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 LOCALIZA 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 LOCALIZA believes that the expectations and assumptions reflected in the forward-looking statements are reasonable based on information currently available to LOCALIZA’s management. LOCALIZA cannot guarantee future results or events. LOCALIZA expressly disclaims a duty to update any of the forward-looking statement.

It is not allowed to offer or sell in the United States securities not registered or exempted from registration. in accordance with the Securites Act of 1933. Any securities offering to be conducted in United States must be made through an offering memorandum. which can be obtained with the underwriters. The offering memo must contain or include reference to detailed information about LOCALIZA and its business and financial results. in addition to its financial statements.

This presentation does not constitute an offering. invitation or offering request or acquisition of any type of securities. Neither this presentation nor anything here included represent the terms of a contract or commitment of any kind.

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Thank You!

Localiza IR:www.localiza.com/riPhone: +55 (31) 3247-7039

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Depreciation rate evolutionx

Seminovos EBITDA margin

24

2000 2001 2002 2003 2004 2005 1Q06

New car priceincrease (Palio)

1.90% 6.72% 7.39% 13.95% 17.42% 9.40% 1.50%

IPCA inflation 5.97% 7.67% 12.53% 9.30% 7.60% 5.69% 1.44%

Real increase(decrease)

- 4.07% - 0.95% - 5.14% + 4.65% + 9.82% + 3.71% + 0.06%

Evolution of car prices increase

-4.1% -5.1%

-1,0%

4.7%

9.8%

3.7%

0.1%

-6.0%

-2.0%

2.0%

6.0%

10.0%

2000 2001 2002 2003 2004 2005 1Q06

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Exemple 1 Exemple 2 Exemple 3 Exemple 4 Exemple 5 Exemple 6 Exemple 7

Car purchase price 100.00 100.00 100.00 100.00 100.00 100.00 100.00

Sale price 95.00 100.00 105.00 110.00 115.00 120.00 125.00

Depreciation rate 14.5% 10.0% 5.5% 1.0% 0% 0% 0%

Book Value 85.50 90.00 94.50 99.00 100.00 100.00 100.00

SG&A (7%) 6.65 7.00 7.35 7.70 8.05 8.40 8.75

EBITDA 2.85 3.00 3.15 3.30 6.95 11.60 16.25

EBITDA margin 3% 3% 3% 3% 6% 10% 13%

Average 3.0% 9.6%

Depreciation rate = {(sale price – 10% of sale price) / Car purchase price}-1where 10% = selling expenses (7%) + safety margin (3%)

Depreciation rate X Seminovos EBITDA margin

26

On-airport x off-airport marketUS, Brazil and Localiza

27

On-airport X off-airport market US – market share (2005)

DTG11%

Hertz28%

Avis Budget32%

Other2%

National/Alamo20%

Enterprise7%

Source:*Avis presentation nov/06 - local segment share amounts are company estimates

US airport segment* - US$10BN US local segment* - US$10BN

Airport (50%): Avis and Hertz (focused on business and services) were not affected by Enterprise Budget and Alamo (focused on leisure) lost market in the last years

Off-airport (50%): Hertz and Avis are fighting for the off-airport market

Hertz9%

Enterprise65%

All others19%

Avis/Budget7%

28

Source:** As of each company website, in Nov/06*** Assuming that each company has in average only one agency

BR airport segment** - agencies BR local segment** - agencies

***

LOCALIZA76

HERTZ33

AVIS31

UNIDAS30

OUTRAS49

• In the airports the market is concentrated in the hands of the networks• Off-airport market is fragmented mainly among the small car rental companies

OTHERS

Others

On-airport X off-airport market Brazil – number of agencies (2005)

1723

Unidas74

Avis83

Localiza267 Hertz

84

29

41

55

45

88

9/30/2005 9/30/2006

35%

65%

29%

71%

9M05 9M06

47%

53%

41%

59%

9M05 9M06

9.8%

60.0%96

133Owned agencies

On-airport X off-airport market Localiza – number of agencies

Off-airport agencies Airport agencies

6 p.p.

The share of the off-airport agencies is growing in volume and revenue

-6 p.p.

Volume100 100

-6 p.p.

6 p.p.

Revenue100 100

Off-airport agencies

Airport agencies

30

RetailX

Replacement and mini-lease

31

Retail Replacement Mini-lease

70,0 60,0

95%

57,0

2

0,50

80%

56,0

8

2,00

Rate index

Utilization rate

Revenue

Interactions (0.25 each)

Total fixed cost 5,00*

100,0

60%

60,0

20

Retail X Replacement and mini-lease

* It does not include 5% airport fees

Reservation

Pick up

Usage

After-salesCar return

Volume 36% 64%Revenue 58% 42%

100% 100%

Contribution margin 55,0 54,0 56,5

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11ª Conferência Anual - Santander (inglês)

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