Vale: A Global Leader Vale: A Global Leader February 2008 1
Disclaimer ”This presentation may contain statements that express management’s expectations about future events or results rather than historical facts. These forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those projected in forward-looking statements, and Vale cannot give assurance that such statements will prove correct. These risks and uncertainties include factors: relating to the Brazilian and Canadian economies and securities markets, which exhibit volatility and can be adversely affected by developments in other countries; relating to the iron ore and nickel businesses and their dependence on the global steel industry, which is cyclical in nature; and relating to the highly competitive industries in which Vale operates. For additional information on factors that could cause Vale’s actual results to differ from expectations reflected in forward-looking statements, please see Vale’s reports filed with the Brazilian Comissão de Valores Mobiliários and the U.S. Securities and Exchange Commission.” 2
Why invest in Vale? 3
Vale: the largest metals and mining company of the Americas 131.6 market capitalization 1 US$ billion 44.3 31.8 26.1 24.3 Vale Barrick Gold Freeport Alcoa Newmont McMoran 1 as of January 24, 2008. 4
Vale: strong cash flow trend 16.9 LTM adjusted EBITDA¹ CAGR 2002-2007 = 48.4% 15.6 US$ billion 12.5 10.1 8.3 7.3 7.2 6.5 5.8 5.0 4.0 3.7 3.3 2.9 2.4 2.1 2.0 1.9 1.7 1.8 1.8 1.6 1.5 1Q02 2Q02 3Q02 4Q02 1Q03 2Q03 3Q03 4Q03 1Q04 2Q04 3Q04 4Q04 1Q05 2Q05 3Q05 4Q05 1Q06 2Q06 3Q06 4Q06¹ 1Q07¹ 2Q07¹ 3Q07¹ 1 LTM = last twelve months, excluding extraordinary effect of inventory adjustment 5
Vale: more profitable than any Top 5 most admired companies in the US 1 Operating Profit Margin 50 % Berkshire Hathaway 45 Procter & Gamble 40 35 General Electric 30 % 25 Disney 20 15 FedEx 10 5 0 1 As ranked by Fortune Magazine 2007 Source: Fortune Magazine, Bloomberg and Vale Note: Nine month period ended on Sep/2007 for Vale, Disney and Berkshire Hathaway. Last twelve month perior ended 6 on Dec/2007 for General Electric and Procter & Gamble; on Nov/2007 for FedEx.
Vale: average dividend yield of 3.1% 1 Dividend distribution 0.51 US$ per share CAGR 2003-2008 2 = 25.6% 0.39 0.28 0.27 0.17 0.14 0.13 2 2002 2003 2004 2005 2006 2007 2008 1 2002-2007 period 2 Minimum dividend proposal as announced on January 21, 2008. 7
Vale: # 1 in shareholder value creation 1 The large-cap 2 Top Ten , 2002-2006 Total Shareholder Return (TSR) Vale 54.6% América Móvil 53.3% Apple 50.6% British American Tobacco 25.8% Genentech 24.5% Anglo American 23.2% BHP Billiton 23.2% Endesa 20.8% Toyota 20.7% Boeing 20.1% 1 Boston Consulting Group “The 2007 Value Creators report”. Large cap = companies with market cap above US$ 50 billion 2 TSR average between 2002 and 2006 8
Vale: #1 traded ADRs at the NYSE in 2007 Top 10 traded ADRs 1 Ranking Company Country US$ million 1 Vale Brazil 725.56 2 Petrobras Brazil 626.93 3 Nokia Finland 360.00 4 América Móvil Mexico 322.15 5 PotashCorp Canada 281.03 6 BP UK 273.16 7 BHP Billiton Australia 230.12 8 Suncor Canada 220.31 9 Barrick Gold Canada 219.62 10 GoldCorp Canada 208.15 1 Average daily value of trading, in 2007 9 Source: NYSE Euronext
Vale does not make products that you can buy. However, they are always present in your daily life 2007 9M07 sales revenues US$ 24.7 billion PGM iron ore and others 1,1% pellets 3,1% 42,8% aluminum 8,3% logistics nickel 4,6% 32,5% copper Manganese e 5,9% ferroalloys 1,8% 10
Vale investment appeal � Profitability at January 24, 2008 Price: $28.32 � ROEs in excess of 30% 52-wk Lo/Hi: $16.35/ $36.50 � Operating profit margins higher than 40% � Return to shareholder � Average annual TSR in excess of 50% � Dividend per share growth higher than 25% � Growth � High demand from the locomotive of the world, China � +30 low-cost high-return project pipeline 11
Vale: a global leader Look forward to hosting you at booth #413 www.vale.com e-mail: rio@vale.com 12
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