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Vale's 1Q09 Financial Results: Resilience Amid Economic Challenges

On May 7, 2009, Vale released its 1Q09 financial results, reflecting a solid performance despite unprecedented market conditions. With $12.2 billion in cash reserves and a low leverage ratio of 1.0x compared to 1Q08, Vale reported a gross revenue of $5.42 billion, down 27.2% from $7.44 billion in 4Q08. The operational profit also fell to $1.69 billion (-16.3%), while net profit remained relatively stable at $1.36 billion. The company is focused on cost reduction and enhancing efficiency, aiming to strengthen its competitive position in the global mining sector.

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Vale's 1Q09 Financial Results: Resilience Amid Economic Challenges

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  1. 1Q09 Result Facing the current scenario Rio de Janeiro – May 7th, 2009

  2. Solidity before an unprecedented scenario $ 12.2 billion in cash reserves and low leverage: 1,0x 1Q08 1Q09Δ% Gross revenue 7,442 5,421 -27.2 Operational profit 2,013 1,685 -16.3 Net profit 1,367 1,363 -0.3 EBITDA 2,697 2,281 -15.4 In USD millions

  3. Vale’s iron ore and pellet sales Millions of metric tons - 5,1%

  4. Portfolio of products Gross revenue by product 1Q09 US$ 5,421 millions 4Q08 US$ 7,442 millions * * * cobalt, kaolin, potash and others

  5. Diversification in the destination of sales Gross revenue by destination 1Q09 US$ 5,421 millions 4Q08 US$ 7,442 millions

  6. Reducing the cost of products In U.S. $ million Sales volume D exchange rate Prices of inputs and others

  7. Responding to the recession Pursuit of greater efficiency in corporate activities Staff insourcing Contract renegotiations with suppliers Cost cuts in projects that are being developed Optimization of product lines Closure of mines that incur the highest operational costs

  8. Strengthening our competitiveness 43% of all iron ore production currently comes from mines located in Carajás. Over the past 5 years, these mines were responsible for 32% of total iron ore production. Carajás: low cost and high quality operations Carajás: the largest proven and probable reserves in the world: 7.2 billion metric tons and 67% Fe content Initiative to create an exclusive maritime transport line: fleet of 12 VLOCs and charter contracts Increased customer base Distribution centers in the Middle East and Asia for a more flexible distribution capacity More flexible stance on iron ore pricing

  9. Level of employment Vale has had a positive balance: 3294 jobs compared to 1Q08

  10. Stable Investment Acquisitions in 1Q09: US$ 922 millions USD billions * + 1,2% * Excludes purchases

  11. Socio-environmental investments: US$ 133.3 millions in 1Q09 US$ millions

  12. Vale is Brazil’s biggest net exporter 102% of the Brazilian trade surplus in 1Q09 USD billion * exports - imports

  13. Second largest mining company in the world Market capitalization Dec 31, 2001 Mai 6, 2009 US$ 9.2 billion US$ 95.3 billion Record on 16/mai/08:US$ 200.5 billion

  14. 1Q09 Result Facing the current scenario www.vale.com/pressoffice Rio de Janeiro – May 7th, 2009

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