20150701 cielo july

Copyright © Cielo | Todos os direitos reservados

CORPORATE PRESENTATION

July, 2015

THE COMPANY MAKES FORWARD LOOKINGSTATEMENTS THAT ARE SUBJECT TO RISKS AND UNCERTAINTIES

DISCLAIMER

These statements are based on the beliefs and assumptions of our management as well as on information currently available to us. Forward-looking statements

include information regarding our current intent, beliefs or expectations, in addition to those of the members of the Board of Directors and Executive Officers

of the Company.

Forward-looking statements also include information regarding our possible or assumed future operating results, as well as statements preceded or followed by, or

that include, the words ''believes”, ''may”, ''will”, ''continues”, ''expects”, ''anticipates”, ''intends”, ''plans”, ''estimates”, or similar expressions.

Forward-looking statements are not guarantees of performance. They involve risks, uncertainties and assumptions, for they relate to future events, thus depending on

circumstances that may or may not occur. Our future results and the creation of value to shareholder s may differ significantly from those expressed in or suggested by these

forward-looking statements. Many factors determining these results and values are beyond Cielo’s ability to control or predict.

#1MERCHANT ACQUIRER AND PAYMENT PROCESSOR IN BRAZIL AND LATIN AMERICA

OF GDP CAPTURED THROUGH CIELO´S NETWORK

MARKET CAP – AMONG 10 LARGEST IN BM&FBOVESPA

BRL 80 BILLION9.4%

CIELO | LEADING MERCHANT ACQUIRER

*

*Closing date: 06/26/2015Exchange: 1USD = 3.20 BRL (06/26/2015)

3


CIELO | SUBSTITUTION OF CASH AND CHECKS

* Excluding Private Labels

Cards Expenditure over PCE* (%)

PCE - Private Consumption Expenditure (R$ billion)

Card Expenditure (R$ billion)*

Source: IBGE,ABECS 4

* Excluding Private Labels

2007 2008 2009 2010 2011 2012 2013 2014 1Q14 1Q15

16.1%17.7%

19.1%20.8%

22.8%24.4%

26.2%27.9%

26.5% 27.4%

2007 2008 2009 2010 2011 2012 2013 2014 1Q14 1Q15

1,6291,857

2,0642,341

2,6372,908

3,2013,450

830 888

2007 2008 2009 2010 2011 2012 2013 2014 1Q14 1Q15

262329

394487

601710

837

964

219 243

CIELOPROMO

Cielo’s offering is the most comprehensive available including some unique products

• Loyalty program developed exclusively to merchants

• Largest B2B in Latin America• Accrual of points based on

merchant’s volume with Cielo

• Most flexible and the easiest to use promotional marketing tool in the market

• Can be offered to merchants, brands and issuers

CIELO| PRODUCTS

CIELO FIDELIDADE

5


CIELO | NEW TECHNOLOGIES

Wireless POS terminals (GPRS)• Corresponds to 64% of

Cielo’s installed basis (as of 1Q15)

• Strong demand from our merchants

NFC (Near Field Communication)• More than 1.4 million

terminals installed with such technology

Mobile Chip & Pin • Perfect for professionals and merchants

that require convenience and mobility• Data protected to ensure the integrity of

transactions• Sales Receipt may be sent by email to

the cardholder

Cielo invests in new technologies for capturing devices to our merchants

6

November2010

March2012

August2010

May2011

September2012

October2012

January2010

April2014

November2014

June2014

CIELO| STRATEGIC PLANNING

Cielo has been active to be well positioned to capture new avenues of growth

Launching the new e-commerce platform

Acquisitionof M4U

Acquisitionof Braspag

Launching of Cielo Mobile

Partnership withCyberSource

Acquisition of MeS

Launching of Cielo MobileChip & Pin

MoU to participate in Stelo

MoU to createa JV betweenCielo and Linx

Association between

Cielo and Banco do

Brasil

7

Business Expansion

Data base of 1.6 million active points of sale more than 5 billion transaction a yearCIELO BIG DATA

CIELO BIG DATA RESPONDS:

How is retail performing?

What are the most accurate and updated figures of brazilian retail considering its several sectors and regions?

Considering the main performance metrics, how is my sector performing?

How are my peers performing?

Why my store located at a specific city/neighborhood is not performing? Is it the manager or the location?

What is my customer purchase profile? Why am I losing customers? What shall I do to bring them back?

Which microregion has the biggest revenue potential that I have not explored yet? Which spot should I open my next store?

BIG DATA PRODUCTS:

ICVA

BenchmarkCustomizedPromo

E-commerceSectorial analysis

Shoppings On Demand

8

Source: CIELO

CIELO´S BROAD RETAIL INDEX (ICVA)NOMINAL REVENUE OF SALES GROWTH (YOY)

DIFFERENTIAL

Territorial coverage of 99% of the

country

Scope sized companies: from small retailers to

large retailers

Based on actual information

and not in sample surveys

Dynamic model, based on the actual mix

of each sector in the economy

Over 20 economic sectors, including services (eg: airlines, restaurants and e-commerce)

Improved disclosure

9

May-14 Jun-14 Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14 Jan-15 Feb-15 Mar-15 Apr-15 May-15

12.5%

8.1%

9.6%10.2%

10.1% 10.1%10.5%

8.0%8.9%

4.5%

9.0%

7.1%

6.5%

12.0% 10.9%

9.8%

10.8%

9.5%

8.4% 8.6%8.1% 8.2% 7.3%

7.2%

5.9%

6.9%

5.5%

0.5%

3.5% 3.7%3.4% 3.7%

4.3%

1.8%2.1%

-2.4%

3.3%

1.1%

0.4%

5.1%

3.1%

3.7%4.3%

2.9%2.1%

2.6%1.8% 1.5% 0.2%

1.6%

0.0%0.7%

Nominal ICVAAdjusted Nominal ICVADeflated ICVA*Adjusted Deflated ICVA

*IPCA Deflation according to the sector set by ICVA

163,941202,084

244,960279,617

312,62498,742

118,315138,368

169,131204,986517,610 CAGR: 18.5%

AnnualEvolution(R$ million)

2012 2013

448,748

320,399

CreditDebit

The financial volume does not include Merchant E-Solutions transactions, i.e., it comprises the financial volume of the domestic market only.

CIELO| TRANSACTION FINANCIAL VOLUME

20112010

383,329

262,683

2014

10

73,120 84,952 75,484

46,454

58,97751,055

Quarterly Evolution (R$ million)

119,574 126,539

143,929

4Q14

-12.1%

1Q14 1Q15

5.8%

CIELO| NUMBER OF TRANSACTIONS


2012 2013

CreditDebit

The number of transactions does not include Merchant E-Solutions transactions, i.e., it comprises the number of transactions of the domestic market only.

2010 2011

1,601 1,837 2,062 2,283 2,525

1,7161,964

2,2402,618

3,134

3,3173,801

4,3024,902

5,659

2014

CAGR: 14.3%

11

592 672 610

727

8968151,4251,318

8.1%

4Q14

1,568

-9.1%

QuarterlyEvolution(million)

1Q151Q14

CIELO| OPERATIONAL INDICATORS

1Q14 4Q14 1Q15

Quarterly Evolution(Thousand)

* Points of Sales Merchants are those that have made at least a single transaction in the last 30 days .The year is measured based on the closing

POS Terminals Points of Sales Merchants (30 days)*2010

1,2771,484

1,7271,831

2,023

1,069 1,1561,282

1,4261,619

Annual Evolution(Thousand)

2010 2011 2012

CAGR: 10.9%

CAGR 12.2%

20142013

12

1,8652,023 2,020

1,4351,619 1,637

-0.2%14.1%

1.1%

8.3%

1,817.7

2,128.72,351.8

1Q14 4Q14 1Q15


CIELO| NET OPERATING REVENUE

NET OPERATING REVENUE

QuarterlyEvolution(R$ million)

29.4%

20112010

10.5%

3,992.5 4,208.7

5,385.3

6,734.27,725.6

CAGR: 17.9%

2012 201320112010 2014

13

73.1% (9,954)

68.5% (10,282) 66.2%

(9,789)

26.9% (3,663)

31.5% (4,728)

33.8% (4,998)

18.7% 17.7

%

19.6%

1Q14 4Q14 1Q15

CIELO| PREPAYMENT OF RECEIVABLES VOLUME8.6% -1.5%

14

Quarterly Evolution(R$ million)

13,61815,010 14,787

%Pre-paid Volume from

Credit Installments

% Prepayment over Total

Credit Volume

%Pre-paid Volume from

Regular Credit

10,34015,407

26,409

44,286

56,062

6.3%7.6%

10.8%

15.9%

17.9%

2012 201414

20112010


2013

CAGR: 52.6%

Total Pre-paid Volume

CIELO| PREPAYMENT OF RECEIVABLES REVENUE

15

343.8

535.3

768.1

953.1

1,508.6

329.2

423.1462.9

1Q14 4Q14 1Q15



Prepayment of Receivables Net Revenue (R$ million)

2012 2014201320112010

40.6%9.4%

CAGR: 44.7%

CIELO| PREPAYMENT OF RECEIVABLES INDICATORS

16

Prepayment of Receivables 1Q15 1Q14 4Q14 1Q15 X 1Q14

1Q15 X 4Q14

*Assuming the cost of 104% of CDI in Financial Volume of Prepayment

% Prepayment over Total Credit Volume 19.6% 18.7% 17.7% 0.9 p.p. 1.9 p.pFinancial Volume of Prepayment (R$ million) 14,787.0 13,617.7 15,010.2 8.6% -1.5% % Pre-paid volume from regular credit 33.8% 26.9% 31.5% 6.9 p.p 2.2 p.p % Pre-paid volume from credit in installments 66.2% 73.1% 68.5% -6.9 p.p -2.2 p.pAverage Term (Calendar Days) 57.3 58.4 55.8 (1.1) 1.5Average Term (Business Days) 38.7 39.5 37.4 1.2 (0.8) Gross Revenue of Prepayment of Receivables (R$ million) 536.9 410.2 516.7 30.9% 3.9%Present Value Adjustment Expenses (R$ million) (12.8) (13.7) (31.2) -6.6% -59.0%Cost of Funding with Third Parties (R$ million) (61.2) (67.4) (62.3) -9.1% -1.8%Prepayment of Receivables Net Revenue (R$ million) 462.9 329.2 423.1 40.6% 9.4%

Managerial AnalysisGross Revenue of Prepayment of Receivables (R$ million) 536.9 410.2 516.7 30.9% 3.9%Cost of Funding* (R$ million) (271.8) (219.3) (247.3) 24.0% 9.9%Managerial Net Revenue (R$ million) 265.1 191.0 269.4 38.8% -1.6%

2,564 2,388

3,0973,575

3,838

64.2%

56.8% 57.5% 53.1%49.7%

CIELO| EBITDA


1Q14 4Q14 1Q15

2012* 2013


EBITDA MARGIN %EBITDA

CAGR: 10.6%

*2012 figures were only impacted by Merchant E-Solutions in 4Q12

20112010 2014

17

1,001.4924.6

1,186.6

55.1%43.4%

50.5%

28.3%18.5%

1Q14 4Q14 1Q15


1,831 1,817

2,3322,674

3,220

2012* 2013

45.9% 43.

2%43.1% 39.

7%

41.7%


NET MARGIN %NET INCOME* 2012 figures were only impacted by Merchant E-Solutions in 4Q12

CAGR: 15.2%

20112010 2014

18

CIELO| NET INCOME

802.7 803.0

911.8

13.6%

44.2%

37.7%

38.8%

13.6%

CIELO | INVESTMENT HIGHLIGHTS

Leader in a growing market

Strong balance sheet, high cash generation and low capex requirements

Minimum dividend payout of 30% of net profit* distributed twice a year

Focus on innovation, diversificationand continuous growth

* After constitution of legal reserve of 20% of the Company´s capital stock

19

CIELO | ADR

Cielo has a sponsored Level I ADR Ticker: CIOXY ADR Ratio (ADR:ORD): 1:1 Depositary bank: Deutsche Bank Trust Company Americas Depositary bank contacts:

ADR broker helpline:Tel: +1 212 250 9100 (New York) Tel: +44 207 547 6500 (London)

Email: [email protected] website: www.adr.db.com Depositary bank’s local custodian: Banco Bradesco

* Since December 2013 no IOF charged

20

mailto:[email protected]

http://www.adr.db.com/


APPENDIX

1995 2009 2015

June 2009

Single Visa Acquirer

R$ 8.4 billion IPO

+

Multi-brand acquirer

CIELO | TIMELINE

4 Visa acquirers

22

http://www.cetelem.com.br/

http://www.policard.com.br/

http://www.cabal.com.br/

1,886,677,126 Common SharesCIELO | CAPITAL OWNERSHIP

23*Tempo Serviços LTDA is a Bradesco subsidiary company which started envisaging Ciel3 on its investment portfolio

b. 28.65%

a. 28.65%

a+b= 57.3%

Tempo Serviços* 1.41%

Free Float: 40.95%

Treasury: 0.35%

BRAZIL | ECONOMIC SCHEME

Gross MDR

Net MDR Interchange Fee

The brand defines the interchange fee.

The acquirer negotiates the gross MDR with the merchant.

MERCHANTS

Issuer

Card Holder

24

2.90

2.952.98 2.98

2.84

2.79 2.78 2.77

2.84

BRAZIL | MERCHANT DISCOUNT RATES

Source: Central Bank 25

1Q073Q07

1Q083Q08

1Q093Q09

1Q103Q10

1Q113Q11

1Q123Q12

1Q133Q13

1Q143Q14

1.581.59

1.601.61

1.57

1.59 1.59

1.57

1.59

Credit Gross MDRDebit Gross MDR

Market Credit and Debit Gross MDR Evolution

BRAZIL | MARKET SHARE – TOP 4 ACQUIRERSCaptured volume [R$ Bi], market share [%]

26Source: Quartely earnings release (Cielo, Rede/Itaú, Santander and Banrisul); Cielo´s Analysis

1Q15

240

10.9%

4(1.8%)

18(7.7%)

91(37.9%)

127(52.6%)

4Q14

271

13.0%

5(1.7%)

20(7.3%)

103(38.0%)

144(53.1%)

3Q14

236

14.0%

4(1.6%)

15(6.5%)

88(37.4%)

129(54.5%)

2Q14

227

16.3%

3(1.5%)

13(6.0%)

84(37.2%)

125(55.3%)

1Q14

217

18.9%

3(1.4%)

12(5.7%)

82(37.7%)

120(55.2%)

4Q13

240

20.2%

3(1.4%)

14(5.7%)

92(38.1%)

132(54.8%)

3Q13

207

19.7%

3(1.3%)

11(5.2%)

81(38.9%)

113(54.6%)

2Q13

195

18.3%

2(1.2%)

10(5.0%)

76(39.2%)

106(54.6%)

1Q13

182

17.0%

2(1.2%)

9(4.7%)

74(40.6%)

98(53.6%)

5.8%

11.5%

47.8%

44.4%

1Q15yoy [%]

Cielo Rede Santander Banrisul Industry Growth

CIELO | eCommerce POSITION

Source: Company, Broker reports, Cybersource 27

Card

Slip

Acquirers

Gateways

Banks

Debit

Wallets/ Subacquirers


CieloCapital

Investment of R$ 8.1 billion

30% 70%

Pro forma net income*

R$ 615 million 2014

Association

BBContributed

management of part of Arranjo

Ourocard*

*As per the due diligence performed during the negotiations

CatenoValued at

R$ 11.6 billion

*Scope of Arranjo Ourocard Association: Purchase transactions from all credit and debit cards issued by Banco do Brasil labeled by Visa, Mastercard, Elo and American Express brands, excluding the cards related to the prepaid business, payment solutions provided to government entities and private label cards issued under current partnerships with retailers .

Banco do Brasil´s cards division (before the Association)

ResponsibilitiesMarketing

Credit concession and analysis

Relationship with the cardholder

Loyalty Program

Collection

Client´s activation

Payment account management

Security management and control

Payment of fees to cards brands and payment arrangements

RevenuesFee related to the issuance of cards

Annuity

Fee related to pre-paid accounts

Fee related to the legal entity relationship program

Revenues related to operations of generating cards invoice installments

Arranjo Ourocard* interchange fee

Potential additional revenues

Ass

oci

ati

on

CATENO VALUED AT R$11.6 BILLION

28

Copyright © Cielo | Todos os direitos reservados29

Numbers (R$ million)

1) Cielo Consolidated

1Q15 1Q14 4Q14 1Q15 X 1Q14 1Q15 X 4Q14

Net Revenue 2,351.8 1,817.7 2,128.7 29.4% 10.5%

Cost+Expenses (1,321.6) (919.0) (1,318.2) 43.8% 0.3%

Cielo Net Income 911.8 802.7 803.0 13.6% 13.6%

3) Cielo Brazil

1Q15 1Q14 4Q14 1Q15 X 1Q14

1Q15 X 4Q14

Net Revenue 1,697.9 1,521.1 1,756.7 11.6% -3.3%

Cost+Expenses (740.5) (635.0) (927.3) 16.6% -20.1%

Cost+Expenses per transaction

R$0.52 R$0.48 R$0.59 7.9% -12.1%

Cielo Net Income 946.2 799.7 814.8 18.3% 16.1%

4) Other Subsidiaries

1Q15 1Q14 4Q14 1Q15 X 1Q14

1Q15 X 4Q14

Net Revenue 446.5 296.6 372.0 50.5% 20.0%

Cost+ Expenses (427.5) (284.0) (353.7) 50.5% 20.9%

Cielo Net Income 9.0 3.0 12.8 200.5% -29.6%

Cateno2) Cielo exCateno1Q15 1Q14 4Q14 1Q15 X 1Q14 1Q15 X 4Q14

Net Revenue 2,144.4 1,817.7 2,128.7 18.0% 0.7%

Cost+Expenses (1,168.0) (919.0) (1,281.0) 27.1% -8.8%

Cielo Net Income 955.2 802.7 827.6 19.0% 15.4%

Copyright © Cielo | Todos os direitos reservados30

Cateno 1Q15 (R$ Million)

Business Result Accounting Value

Net Revenue 207.3 207.3

Costs + Expenses (114.0) (114.0)

Amortization* - (32.1)

Result 93.3 61.2

Income Tax\ CSLL** (31.7) (20.8)

Net Income 61.6 40,8

Share Cielo – 70% 28.6

Financial expenses (post taxes)

(61.6)

Net contribution (33.0)

* Amortization of R$11.6 billion intangible assets in 30 years

Accretive from 2S16

“Cash Basis” (ex Cateno amortization)

Net Revenue 207.3

Costs + Expenses (114.0)

Amortization* -

Result 93.3

Income Tax\ CSLL** (20.8)

Net Result 72.5

Share Cielo – 70% 50.8

Financial expenses (post taxes)

(61.6)

Net contribution - cash basis (10.8)

Accretive from 2S17

Cateno ex extraordinary

** Social Contribution

CIELO | DEBT EVOLUTION

31

Total Indebtedness (R$ billion)

*Including Pre-payment with Issuing Banks

1. Public Debentures: 4.62. Private Debentures: 3.43. Bonds: 2.84. Finame: 0.5

Total: 11.4

5. Funding with issuing banks: 3.6

Total including funding with issuing banks: 15.0

0.0

0.5

1.0

1.5

2.0

2.5

3.0

-1,000

1,000

3,000

5,000

7,000

9,000

11,000

13,000

15,000

0.4x0.4x

0.6x

1.8x

0.8x

1.2x 1.0x

2.5x

Net Debt Evolution (R$ billion)

2012 2013 2014 03/31/2015

CIELO | DEBT AMORTIZATION SCHEDULE

32

“Ten-Year Bonds”

Private Debentures*

FINAME PSI (BNDES)

Principal Amortization Schedule* (R$ billion)

Public Debentures

* Private Debentures with Banco do Brasil. Amortization in 8 years but considering put/call in year 5.

Issuance of Loan (Bank of Tokyo-Mitsubishi UFJ)

2015 2016 2017 2018 2019 2020 2021 2022

0.2 0.2 0.1

1.51.5

1.5

0.6

3.5

2.8

2.4

1.6

0.2

1.5

3.5

2.8

26-Jun-09 26-Jun-10 26-Jun-11 26-Jun-12 26-Jun-13 26-Jun-14 26-Jun-1550.00

75.00

100.00

125.00

150.00

175.00

200.00

225.00

250.00

275.00

300.00

325.00

350.00

375.00

400.00

425.00

450.00

475.00

500.00

CIEL3 IBOV

R$42,39

54.016

CIELO | CIEL3 OUTPERFORMING IBOVStock performance (IPO date* = 100)

*06/29/2009 33


RELATIONSwww.cielo.com.br/ri

E-mail: [email protected] Phone: + 55 11 2596-8458

INVESTOR

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20150701 cielo july

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