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Financial StatementS
FINANCIAL STATEMENTS
Ecorodovias Infraestrutura e Logística S.A.
December 31, 2016 and 2015 with Independent Auditor’s Report
Independent auditor’s report on financial statements ...........4
Financial statements
Statements of financial position ........................................................ 8
Statements of operations ................................................................... 10
Statements of comprehensive income ........................................... 11
Statements of changes in equity .....................................................12
Cash flow statements .............................................................................14
Statements of value added .................................................................16
Notes to financial statements ............................................................ 17
SUSTAINABILITY REPORT 2016 3
FINANCIAL STATEMENTS
TheShareholders, Board of Directors and Officers Ecorodovias Infraestrutura e Logística S.A.São Paulo - SP
OPINIONWe have audited the individual and consolidated financial statements of Ecorodovias Infraestrutura e Logística S.A. (“Company”), identified as Company and Consolidated, respectively, which comprise the statement of financial position as at December 31, 2016 and the statements of operations, of comprehensive income, of changes in equity, and cash flows for the year then ended, and notes to the financial statements, including a summary of significant accounting practices.
In our opinion, the accompanying financial statements referred to above present fairly, in all material respects, the individual and consolidated financial position of Ecorodovias Infraestrutura e Logística S.A. as at December 31, 2016, its individual and consolidated financial performance and its individual and consolidated cash flows for the year then ended, in accordance with accounting practices adopted in Brazil, and the International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board (IASB).
BASIS FOR OPINION We conducted our audit in accordance with Brazilian and International standards on auditing. Our responsibilities, under those standards, are further described in the “Auditor’s responsibilities for the audit of individual and consolidated financial statements” section of our report. We are independent of the Company and its subsidiaries and comply with the relevant ethical principles set forth in the Code of Professional Ethics for Accountants, the professional standards issued by the Brazil’s National Association of State Boards of Accountancy (CFC) and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to support our opinion.
KEY AUDIT MATTERSKey audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements of the current year.
Those matters were addressed in the context of our audit of the overall individual and consolidated financial statements, and to form our opinion on these individual and consolidated financial statements. Therefore, we do not express a separate opinion on those matters.
FAIR VALUE OF ASSETS HELD FOR SALEIn 2016, subsidiaries Elog S.A. and Ecopátio Logística Cubatão Ltda. were no longer considered core assets for the EcoRodovias Group, and, with the decision made by Company management, after reviewing its Long-Term Strategic Planning, to focus upon road assets, the Company decided to make such assets available for sale. Accordingly, following the accounting standards, the Company recorded the fair value adjustment of those investments at R$686,282 thousand at December 31, 2016. Related disclosures are included in Note 6 b). Estimated fair value of assets is subjective and includes uncertainties and professional judgment supported by analyses prepared by Company management.
This matter was considered a key audit matter given the materiality of amounts and the uncertainty inherent in this type of estimate and in the judgment necessary exercised by management in calculating the fair value of the assets.
How our audit has addressed this matter:
Our audit procedures included, among others, the use of specialists to help us validate the assumptions and methodologies used by the Company, and conduct tests of the corresponding fair value calculations, in addition to the appropriate disclosure included in the abovementinoed Note.
REALIZATION OF DEFERRED INCOME AND SOCIAL CONTRIBUTION TAX ASSETS OF ECOPORTO SANTOS S.A.Ecoporto Santos S.A. recognizes amounts related to income and social contribution taxes on (i) income and social contribution tax losses carryforward, and (ii) temporary differences arising from differences
INDEPENDENT AUDITOR’S REPORT ON INDIVIDUAL AND CONSOLIDATED FINANCIAL STATEMENTS
ECORODOVIAS4
between the tax bases of assets and liabilities and their corresponding carrying amounts. At December 31, 2016, deferred tax assets presented in the financial statements amounted to R$ 206,689 thousand (R$ 430,164 thousand at December 31, 2015), net of impairment recorded in the amount of R$ 244,010 thousand in 2016.
Ecoporto supports the recoverability of deferred taxes through projections of future taxable profits for the following ten years, discounted to present value. Such projections are prepared and grounded based on assumptions, such as: (i) revenue growth; (ii) behavior of costs and expenses; (iii) discount rate, among others. Such projections include uncertainties and professional judgment that may not materialize in the future, which can change the realization term and plan. This item is disclosed in Notes 7 and 18 to the financial statements.
This matter was considered a key audit matter given the materiality of amounts involved and the uncertainty inherent in this type of estimate and in the judgment necessary exercised by management in determining the assumptions and projecting future profits.
How our audit has addressed this matter:
Our audit procedures included, among others: (i) involvement of specialists to help us evaluate Ecoporto business plans; (ii) evaluation of assumptions and methodologies used by management in relation to estimated future taxable profits, and discounts rate applied; (iii) evaluation of projections for realization of referred to tax credits considering Ecoporto business plan; and (iv) evaluation of whether the business plan considered by the Company to prepare the projections was duly approved by the Board of Directors.
In addition, we evaluated whether the respective disclosures in the financial statements, included in the abovementioned Notes, were appropriate.
REVENUE RECOGNITION IN THE PORT AND LOGISTICS SEGMENTSService rendering for certain agreements in the port and logistics segments involve multiple-element agreements, such as port operation, storage and logistics, and imply a more complex segregation and measurement of fair value of these services. The Company also estimates and records revenues on an accrual basis. However those estimates consider the past twelve months of billing, multiplied by the average volume (time of service rendered), which involve management judgment and are based on historical or contractual data. The revenue recognition criterion and amount recognized (total revenue) in the port segment are disclosed in Note 31. The logistics segment is presented as assets and liabilities held for sale.
This matter was considered a key audit matter given the materiality of amounts involved, and the complexity of the process necessary to determine and record revenues from logistics and port services, which involves professional judgment by management, accounting estimates and appropriate evaluation of contractual conditions.
How our audit has addressed this matter:
In order to confirm whether revenues were properly recognized, our audit procedures included, among others: (i) evaluation of the adequacy of agreements and their multiple elements within the revenue recognition accounting policies of the Company and its subsidiaries, and adequacy thereof in relation to current accounting standards; (ii) evaluation of the design and operations of internal controls implemented by the Company for the revenue recognition process; (iii) documental test, on a sample basis, of service transactions conducted before and after year end, in order to check whether revenue was recognized for the appropriate reference period and whether revenues recorded were accurate.
In addition, we evaluated whether the respective disclosure in the financial statements was appropriate.
CAPITALIZATION OF EXPENDITURES IN CONCESSION INTANGIBLE ASSETSRoad service concession arrangements represent the right to use the infrastructure, based on accounting standard ICPC 01 (R1) – Service Concession Arrangements, which provides for the obligation to build and/or operate the infrastructure (concession intangible asset) to render utility services on behalf of the grantor, under the conditions set forth in the arrangement. The criteria to recognize these amounts, and amounts invested in the infrastructure, are disclosed in Notes 17 and 26.
This was considered a key audit matter, as capitalization in concession intangible assets involves the use of assumptions, judgment and maintenance of controls by road service concession managements, as such capitalization may not be in compliance with the obligations set forth in the service concession arrangement and, if it is, may be recorded at inappropriate amounts or be unduly capitalized.
How our audit has addressed this matter:
To confirm whether these assets were appropriately recorded and controlled, our audit procedures included, among others: (i) evaluation of adequacy of capitalization policies of investees’ concession intangible assets, including those related to the
SUSTAINABILITY REPORT 2016 5
FINANCIAL STATEMENTS
percentage-of-completion of work method; (ii) documental tests on additions to concession intangible assets, including validations with the engineering area of measurements made in accordance with the percentage of completion, crosschecking against service agreements and/or related invoices; (iii) evaluation of the nature of expenditures capitalized as concession intangible assets, considering the criteria and requirements established in the service concession arrangement, and (iv) physical inspection, on a sample basis, of work performed.
In addition, we evaluated whether the respective disclosures in the financial statements were appropriate.
RELATED-PARTY TRANSACTIONSThe Company and its subsidiaries conduct transactions with related parties of different kinds, which include intercompany loan agreements, future capital contribution, and operational transactions, such as construction and road maintenance services, among others. Significant transactions, balances and contractual conditions are disclosed in Note 23.
This was considered a key audit matter as these transactions may be agreed or recorded for inappropriate amounts, outside the reference period, or not approved by the Company’s governance bodies, particularly in asset construction services.
How our audit has addressed this matter:
To confirm whether these transactions were appropriately recorded and controlled, our audit procedures included, among others: (i) evaluation of the Company’s related-party transaction policy and its application in significant transactions conducted for the year; (ii) analysis of supporting documentation for material transactions, including inspection of agreements and calculations prepared by management; (iii) checking of transaction approval by the Board of Directors, in accordance with the policy established by the Company; and (iv) confirmation letter procedures with the counterparties of the operations on the balances and agreements in force for the year ended December 31, 2016.
OTHER MATTERS
Statement of value addedThe individual and consolidated statements of value added (SVA) for year ended December 31, 2016, prepared under the responsibility of Company management, and presented as supplementary information for purposes of IFRS, were submitted to audit procedures conducted together with the audit of the Company’s financial statements. To
issue our opinion, we evaluated if these statements are reconciled to the financial statements and accounting records, as applicable, and if their form and content comply with the criteria defined by CPC 09 – Statement of Value Added. In our opinion, these statements of value added were prepared fairly, in all material respects, in accordance with the criteria defined in abovementioned technical pronouncement, and are consistent in relation to the overall individual and consolidated financial statements.
Other information accompanying the individual and consolidated financial statements and auditor’s reportCompany management is responsible for all this and other information included in the management’s report.
Our opinion on the individual and consolidated financial statements does not included the management’s report and we do not express any audit conclusion on this report.
In connection with the audit of the individual and consolidated financial statements, our responsibility is to read the management’s report and consider whether it is significantly consistent with the financial statements or, based on our understanding of the audit, presents any material misstatement. If, based on the work performed, we conclude that there is any material misstatement in management’s report, we are required to report this fact. We have nothing to report in this regard.
Management and governance’s responsibility for the individual and consolidated financial statementsManagement is responsible for the preparation and fair presentation of these individual and consolidated financial statements in accordance with accounting practices adopted in Brazil and with the International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board (IAS), and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the individual and consolidated financial statements, management is responsible for assessing the Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no other realistic alternative but to do so.
Those charged with governance are responsible for overseeing the financial reporting process of the Company and its subsidiaries.
ECORODOVIAS6
Auditor’s responsibilities for the individual and consolidated financial statementsOur objectives are to obtain reasonable assurance about whether the individual and consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Brazilian and International standards on auditing will always detect material misstatement when it exists.
Misstatements can arise from fraud or error and are considered material if, individually or in aggregate, they could reasonably be expected to influence the economic decisions of users made on the basis of these financial statements.
As part of the audit conducted in accordance with Brazilian and International standards on auditing, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:
• Identifyandassessrisksofmaterialmisstatementsof the individual and consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than one resulting from error, as fraud may involve override of internal controls, collusion, forgery, intentional omissions or misrepresentations.
•Obtainanunderstandingofinternalcontrolrelevantto the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the internal controls of the Company and its subsidiaries.
•Evaluatetheappropriatenessofaccountingpoliciesused and the reasonableness of accounting estimates and related disclosures made by management.
•Concludeontheappropriatenessofmanagement’suse of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast substantial doubt as to the Companies’ and its subsidiaries’ ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the individual and consolidated financial statements
or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Company and its subsidiaries to cease to continue as a going concern.
•Evaluatetheoverallpresentation,structureandcontent of the financial statements, including the disclosures, and whether the individual and consolidated financial statements represent the corresponding transactions and events in a manner that achieves fair presentation.
•Obtainsufficientappropriateauditevidenceregarding the financial information of the entities or business activities within the group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.
We communicate with those charged with governance regarding, among other matters, of the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal controls that we identify during our audit.
We also provide those in charge of governance with a statement that we have complied with relevant ethical requirements, including applicable independence requirements, and we communicate all relationships or issues that could considerably affect our independence including, where applicable, the respective safeguards.
Of the matters communicated to those in charge of governance, we determine those that are considered most significant in the audit of the financial statements for the current year and, therefore, constitute key audit matters. We describe these matters in our audit report unless the law or regulation has prohibited their public disclosure or when, in extremely rare circumstances, we determine that the issue should not be included in our report because the adverse consequences of such disclosure may, within a reasonable perspective, overcome the benefits of communication to the public interest.
São Paulo, February 20, 2017.
ERNST & YOUNGAuditores Independentes S.S.CRC-2SP015199/O-6
Ezequiel LitvacAccountant CRC-1SP249186/O-5
SUSTAINABILITY REPORT 2016 7
FINANCIAL STATEMENTS
ASSETS NOTE COMPANY CONSOLIDATED
12/31/2016 12/31/2015 12/31/2016 12/31/2015
Assets Current assets
Cash and cash equivalents 8 3,096 62,873 589,504 772,903
Marketable securities 9 - - 61,748 49,666
Trade accounts receivable 10 - - 154,790 197,979
Taxes recoverable 11 33,337 35,243 60,882 67,955
Dividends and interest on equity receivable 12 34,397 14,527 - -
Prepaid expenses 13 25 29 18,194 8,798
Related parties 23 38,805 227 - -
Other receivables 124 702 12,351 20,834
Assets from discontinued operations 6 - - 253,248 -
Total current assets 109,784 113,601 1,150,717 1,118,135
Noncurrent assets
Marketable securities 9 - - 7,371 684
Deferred taxes 18.a - - 368,784 669,845
Escrow deposits 14 2,148 1,949 174,013 211,119
Related parties 23 - 30,942 - -
Other receivables - - 8,322 23,116
Prepaid expenses 13 - - 140 190
IInvestments:
In subsidiaries and affiliates 15.a 983,056 1,235,605 1,017 1,025
Goodwill 15.a 399,751 1,118,527 - -
Property and equipment 16 3,332 3,604 616,763 870,470
Intangible assets 17 456 488 4,276,280 4,966,399
Total noncurrent assets 1,388,743 2,391,115 5,452,690 6,742,848
TOTAL ASSETS 1,498,527 2,504,716 6,603,407 7,860,983
STATEMENTS OF FINANCIAL POSITION December 31, 2016 and 2015 (In thousands of reais - R$)
See accompanying notes.
ECORODOVIAS8
LIABILITIES AND EQUITY NOTE COMPANY CONSOLIDATED
12/31/2016 12/31/2015 12/31/2016 12/31/2015
Liabilities and equity Current liabilitiesTrade accounts payable 1,784 1,059 76,626 94,158Loans and financing 20 - - 339,302 494,835Operating lease 22 - - 99 -Debentures 21 - 17,583 680,535 822,090Taxes, charges and contributions payable 19 3,000 889 35,244 38,509Social and labor liabilities 28 10,873 13,952 59,143 79,493Tax Recovery Program – REFIS - - 672 658Related parties 22 82,440 89 6,747 9,185Concession rights payable 26 - - 25,014 21,369Income and social contribution taxes payable 18.c - - 32,516 15,911Provision for maintenance 24 - - 87,531 55,869Provision for future construction works 25 - - 38,124 43,227Mandatory minimum dividend 30.e - 25,881 - 25,881Advances from customers - - - 10,386Other accounts payable 2,062 1,861 11,572 16,026Liabilities from discontinued operations 6 6,714 - 263,576 -Total current liabilities 106,873 61,314 1,656,701 1,727,597Noncurrent liabilitiesLoans and financing 20 - - 484,203 491,872Operating lease 22 - - 28 -Debentures 21 - 597,530 3,426,093 3,471,414Tax Recovery Program – REFIS - - - 8,221Related parties 23 891,354 263,074 - -Deferred taxes 18.a - 295 20,136 21,712Provision for losses due to tax, labor and civil 29 - - 182,368 215,061Provision for maintenance 24 - - 180,541 179,574Provision for future construction works 25 - - 33,768 51,641Concession rights payable 26 - - 7,427 22,121Other accounts payable 336 28 39,595 33,316Total noncurrent liabilities 891,690 860,927 4,374,159 4,494,932EquityCapital 30.a 360,900 1,320,549 360,900 1,320,549Income reserve – legal 30.c 7,791 160,791 7,791 160,791
Income reserve - additional dividends proposed
30.e 105,014 77,644 105,014 77,644
Capital reserve - stock option plan 30.f 50,285 47,517 50,285 47,517
Capital reserve – disposal of noncontrolling shareholder interest
5,441 5,441 5,441 5,441
Treasury shares 30.g (29,467) (29,467) (29,467) (29,467)Allocated to controlling shareholders 499,964 1,582,475 499,964 1,582,475
Interest of noncontrolling shareholders in equity of subsidiaries
30.h - - 72,583 55,979
Total equity 499,964 1,582,475 572,547 1,638,454TOTAL LIABILITIES AND EQUITY 1,498,527 2,504,716 6,603,407 7,860,983
STATEMENTS OF FINANCIAL POSITION December 31, 2016 and 2015 (In thousands of reais - R$)
See accompanying notes.
SUSTAINABILITY REPORT 2016 9
FINANCIAL STATEMENTS
NOTE COMPANY CONSOLIDATED
12/31/2016 12/31/2015 12/31/2016 12/31/2015
(reclassified) (reclassified)
Net revenue 31 - - 2,828,996 2,735,719Cost of services rendered 32 - - (1,545,435) (1,481,823)Gross profit - - 1,283,561 1,253,896Operating income (expenses) General and administrative expenses 32 (25,289) (49,324) (210,762) (305,675)Equity pickup 15.a 166,874 271,737 (8) 862Interest on equity received 15.a 21,559 27,889 - -Amortization of goodwill – investments 15.a (21,983) (26,484) - -Impairment – investment Ecoporto 7 (300,997) - (300,997) -Other income (expenses), net 562 1,098 2,678 4,941Operating income (loss) before financial income (expenses) (159,274) 224,916 774,472 954,024
Financial income (expenses) Financial incomeFinancial expenses 33 13,945 26,514 138,537 129,649Despesas financeiras 33 (130,287) (126,571) (692,897) (792,858) (116,342) (100,057) (554,360) (663,209)Operating income (loss) for the year before income and social contribution taxes (275,616) 124,859 220,112 290,815
Income and social contribution taxesCurrent 18.b - - (278,924) (215,416)Deferred 18.b 295 (44) (201,021) 56,214 295 (44) (479,945) (159,202)Profit of loss for the year – continuing operations (275,321) 124,815 (259,833) 131,613
Loss after tax for the year resulting from discontinued operations (689,301) (15,841) (689,301) (15,841)
Net income (loss) for the year (964,622) 108,974 (949,134) 115,772Attributable to:Controlling shareholders (964,622) 108,974 (964,622) 108,974Noncontrolling interests - - 15,488 6,798 (964,622) 108,974 (949,134) 115,772Earnings per shareBasic – income for the year attributable to controlling common shareholders 34 (1.73) 0.20
Diluted – income for the year attributable to controlling common shareholders 34 (1.71) 0.19
Earnings per share resulting from continuing operations Basic – income for the year attributable to controlling common shareholders 34 (0.47) 0.24
Diluted – income for the year attributable to controlling common shareholders 34 (0.46) 0.23
STATEMENTS OF OPERATIONS Years ended December 31, 2016 and 2015(In thousands of reais - R$, except basic/diluted earnings per share)
See accompanying notes.
ECORODOVIAS10
COMPANY CONSOLIDATED
12/31/2016 12/31/2015 12/31/2016 12/31/2015
Net income (loss) for the year (964,622) 108,974 (949,134) 115,772
Other comprehensive income - - - -
Comprehensive income (loss) for the year (964,622) 108,974 (949,134) 115,772
Attributable to:
Controlling shareholder (964,622) 108,974
Noncontrolling shareholder 15,488 6,798
STATEMENTS OF COMPREHENSIVE INCOME Years ended December 31, 2016 and 2015 (In thousands of reais - R$)
See accompanying notes.
SUSTAINABILITY REPORT 2016 11
FINANCIAL STATEMENTS
ATTRIBUTABLE TO COMPANY SHAREHOLDERS
CAPITAL RESERVES,
OPTIONS GRANTED
AND TREASURY
SHARES
INCOME RESERVEINTEREST OF
NONCONTROLLING SHAREHOLDERS
IN EQUITY OF SUBSIDIARIES
NOTE CAPITAL LEGAL
ADDITIONAL DIVIDEND
PROPOSEDRETAINED EARNINGS
EQUITY OF CONTROLLING
SHAREHOLDERSEQUITY –
CONSOLIDATED
Balances at December 31, 2014 1,320,549 18,581 155,342 235,897 - 1,730,369 53,817 1,784,186
Stock options granted and recognized 30.f - 4,910 - - - 4,910 81 4,991
Dividends distributed (R$0.42 per share) 30.e - - - (235,897) - (235,897) (4,717) (240,614)
Net income for the year - - - - 108,974 108,974 6,798 115,772
Allocation of income:
Legal reserve 30.c - - 5,449 - (5,449) - - -
Mandatory minimum dividends (R$0,04 per share) 30.e - - - - (25,881) (25,881) - (25,881)
Set-up of dividends reserve 30.e - - - 77,644 (77,644) - - -
Balances at December 31, 2015 1,320,549 23,491 160,791 77,644 - 1,582,475 55,979 1,638,454
Stock options granted and recognized - 2,768 - - - 2,768 42 2,810
Capital contribution from noncontrolling shareholder 30.h - - - - - - 4,200 4,200
Dividends distributed (R$0.08 per share) 30.e - - - (77,644) (43,013) (120,657) (3,126) (123,783)
Loss for the year - - - - (964,622) (964,622) 15,488 (949,134)
Absorption of loss through legal reserve 30.a - - (160,791) - 160,791 - - -
Absorption of loss through capital 30.a (959,649) - - - 959,649 - - -
Allocation of income:
Legal reserve 30.c - - 7,791 - (7,791) - - -
Set-up of dividend reserve (R$0.19 per share) 30.d - - - 105,014 (105,014) - - -
BALANCES AT DECEMBER 31, 2016 360,900 26,259 7,791 105,014 - 499,964 72,583 572,547
STATEMENTS OF CHANGES IN EQUITY Years ended December 31, 2016 and 2015 (In thousands of reais - R$, except earnings (loss) per share)
See accompanying notes.
ECORODOVIAS12
ATTRIBUTABLE TO COMPANY SHAREHOLDERS
CAPITAL RESERVES,
OPTIONS GRANTED
AND TREASURY
SHARES
INCOME RESERVEINTEREST OF
NONCONTROLLING SHAREHOLDERS
IN EQUITY OF SUBSIDIARIES
NOTE CAPITAL LEGAL
ADDITIONAL DIVIDEND
PROPOSEDRETAINED EARNINGS
EQUITY OF CONTROLLING
SHAREHOLDERSEQUITY –
CONSOLIDATED
Balances at December 31, 2014 1,320,549 18,581 155,342 235,897 - 1,730,369 53,817 1,784,186
Stock options granted and recognized 30.f - 4,910 - - - 4,910 81 4,991
Dividends distributed (R$0.42 per share) 30.e - - - (235,897) - (235,897) (4,717) (240,614)
Net income for the year - - - - 108,974 108,974 6,798 115,772
Allocation of income:
Legal reserve 30.c - - 5,449 - (5,449) - - -
Mandatory minimum dividends (R$0,04 per share) 30.e - - - - (25,881) (25,881) - (25,881)
Set-up of dividends reserve 30.e - - - 77,644 (77,644) - - -
Balances at December 31, 2015 1,320,549 23,491 160,791 77,644 - 1,582,475 55,979 1,638,454
Stock options granted and recognized - 2,768 - - - 2,768 42 2,810
Capital contribution from noncontrolling shareholder 30.h - - - - - - 4,200 4,200
Dividends distributed (R$0.08 per share) 30.e - - - (77,644) (43,013) (120,657) (3,126) (123,783)
Loss for the year - - - - (964,622) (964,622) 15,488 (949,134)
Absorption of loss through legal reserve 30.a - - (160,791) - 160,791 - - -
Absorption of loss through capital 30.a (959,649) - - - 959,649 - - -
Allocation of income:
Legal reserve 30.c - - 7,791 - (7,791) - - -
Set-up of dividend reserve (R$0.19 per share) 30.d - - - 105,014 (105,014) - - -
BALANCES AT DECEMBER 31, 2016 360,900 26,259 7,791 105,014 - 499,964 72,583 572,547
SUSTAINABILITY REPORT 2016 13
FINANCIAL STATEMENTS
COMPANY CONSOLIDATED
12/31/2016 12/31/2015 12/31/2016 12/31/2015
(reclassified) (reclassified)
Cash flow from operating activities
Net income (loss) for the year from continuing operations (275,321) 124,815 (259,833) 131,613
Discontinued operations net of cash (99,449) (249,897) (119,584) (228,763)
Adjustments to reconcile net income (used in) generated by operating activities:
Depreciation and amortization 658 689 339,966 344,208
Goodwill amortization 21,983 26,484 - -
Capitalization of interest - - (6,628) (573)
Premium - stock option plan 1,671 2,935 2,768 4,910
Stock option premium – non-controlling shareholders - - 42 81
Loss/disposal of property and equipment and intangible assets 2 95 7,863 7,254
Financial charges and monetary restatement on loans, financing and debentures 55,539 98,456 602,765 714,464
Monetary variation on concession rights - - 4,497 7,352
Provision for losses due to tax, labor and civil contingencies - - 15,416 (1,710)
Monetary restatement on provision for civil, labor and tax contingencies - - 5,967 29,073
Provision for maintenance and provision for construction works - - 104,729 91,887
Monetary restatement of provision for maintenance and provision for construction works - - 30,135 21,960
Income from marketable securities - - - (6,562)
Allowance for doubtful accounts (ADA) - - (2,177) (214)
Equity pickup and interest on equity received (188,433) (299,626) 8 (862)
Withdrawal of escrow deposits (55) - 4,719 2,206
Monetary restatement on escrow deposits (144) (166) (3,329) (19,727)
Deferred taxes (295) 44 201,022 (56,214)
Interest on intercompany loans receivable - (12,570) - -
Interest on intercompany loans payable (35,756) 19,186 - -
Impairment – goodwill – investment Ecoporto 300,997 - 300,997 -
Provision for income and social contribution taxes - - 278,924 215,434
(Increase) decrease in operating assets:
Trade accounts receivable - - (3,288) 13,622
Related parties – customers (38,578) (180) (111) 2,228
Taxes recoverable 1,906 1,208 3,153 (986)
Prepaid expenses 4 (26) (9,619) (1,985)
Escrow deposits paid - - (10,041) (17,394)
Other receivables 578 2,107 12,283 12,070
CASH FLOW STATEMENTS Years ended December 31, 2016 and 2015 (In thousands of reais - R$)
>> CONTINUED
ECORODOVIAS14
>> CONTINUATION
COMPANY CONSOLIDATED
12/31/2016 12/31/2015 12/31/2016 12/31/2015
(reclassified) (reclassified)
Increase (decrease) in operating liabilities:
Trade accounts payable 725 (954) 647 (15,983)
Social and labor liabilities (3,079) 2,565 (4,195) (541)
Taxes, charges and contributions payable 2,111 777 3,709 2,295
Related parties – suppliers 82,351 33 1,408 785
Payment of provision for civil, labor and tax contingencies - (75) (11,353) (14,071)
Maintenance payments - - (100,072) (98,059)
Payments of construction works - - (25,139) (1,150)
Other accounts payable 506 (78) 1,503 11,291
Income and social contribution taxes - - (261,731) (237,271)
Net cash (used in) generated by operating activities (172,079) (284,178) 1,105,421 910,668
Cash flow from investing activities
Dividends and interest on equity received 445,855 373,344 - 1,342
Capital contribution from noncontrolling shareholder - - 4,200 -
Payment of dividends to noncontrolling shareholders - - (3,126) (4,717)
Acquisition of property and equipment and intangible assets (356) (306) (497,584) (576,685)
Related parties – intercompany loans 30,942 (18,372) - -
Investment in subsidiaries – corporate restructuring – see note 2,2) - 157,825 - -
Investment in subsidiaries – capital reduction - 111,767 - 54,800
Investment in subsidiaries – capital contribution (210,985) (316,614) - -
Net cash (used in) generated by investing activities 265,456 307,644 (496,510) (525,260)
Cash flow from financing activities
Related parties – intercompany loans 664,036 243,888 - -
Concession rights payable - - (15,546) (16,728)
Marketable securities - - (18,769) 11,816
Loans, financing and debentures raised – third parties - 595,746 471,331 1,027,927
Payment of loans, financing and debentures (625,782) - (615,461) (151,223)
Payment of promissory notes - (475,000) - (475,000)
Tax Recovery Program – REFIS - - (8,146) 8,696
Payment of dividends and interest on equity (146,538) (235,897) (146,538) (251,839)
Interest paid (44,870) (101,524) (459,181) (371,269)
Net cash (used in) financing activities (153,154) 27,213 (792,310) (217,620)
Net increase (decrease) in cash and cash equivalents (59,777) 50,679 (183,399) 167,788
Cash and cash equivalents at beginning of year 62,873 12,194 772,903 605,115
Cash and cash equivalents at end of year 3,096 62,873 589,504 772,903
Net increase (decrease) in cash and cash equivalents (59,777) 50,679 (183,399) 167,788
See accompanying notes.
SUSTAINABILITY REPORT 2016 15
FINANCIAL STATEMENTS
COMPANY CONSOLIDATED
12/31/2016 12/31/2015 12/31/2016 12/31/2015
(reclassified) (reclassified)
RevenuesFrom toll collection - - 2,261,451 2,108,187From construction works - - 451,408 443,091Port-related - - 290,502 352,701Ancillary - - 83,525 85,633Inputs acquired from third partiesCost of services rendered - - (974,943) (858,812)Materials, energy, third-party services and other (8,931) (17,487) (78,531) (165,685)Gross value added (used) (8,931) (17,487) 2,033,412 1,965,115Depreciation and amortization (658) (689) (339,966) (344,208)Amortization of investments (21,983) (26,484) - -Net value added (used)
generated by the Company (31,572) (44,660) 1,693,446 1,620,907Value added received in transferFinancial income 13,945 26,514 138,537 129,649Equity pickup 188,433 299,626 (8) 862Other (300,435) 28,956 (298,320) 32,799 (98,057) 355,096 (159,791) 163,310Total value added to be distributed (129,629) 310,436 1,533,655 1,784,217Distribution of value added (129,629) 310,436 1,533,655 1,784,217Personnel 14,475 29,351 332,643 388,326
Direct compensation 13,297 27,440 263,189 308,080Benefits 738 1,079 51,252 56,545Unemployment Compensation Fund (FGTS) 440 832 18,202 23,701
Taxes, charges and contributions (295) 44 737,834 413,094Federal (295) 44 609,335 288,238State - - 197 240Local - - 128,302 124,616
Debt remuneration 131,512 128,368 723,011 823,326Interest 54,932 97,724 466,426 462,475Lease 1,225 1,797 30,114 30,468Other financial charges 75,355 28,847 226,471 330,383
Equity remuneration (275,321) 152,673 (259,833) 159,471Mandatory minimum dividends - 25,881 - 25,881Noncontrolling interests - - 15,488 6,798Legal reserve 7,791 5,449 7,791 5,449Profit or loss from discontinued operations 689,301 43,699 689,301 43,699Absorption of loss through legal reserve (160,791) - (160,791) -Absorption of loss through capital (959,649) - (959,649) -Interim dividends paid 43,013 - 43,013 -
Dividends paid (payable) for the following year 105,014 77,644 105,014 77,644
STATEMENTS OF VALUE ADDED Years ended December 31, 2016 and 2015(In thousands of reais - R$)
See accompanying notes.
ECORODOVIAS16
1. OPERATIONSEcoRodovias Infraestrutura e Logística S.A. (“EcoRodovias”, “EcoRodovias Infraestrutura” or “Company”) is a joint-stock corporation listed on the São Paulo Securities, Commodities and Futures Exchange (BM&FBOVESPA S.A), and the Company shares are traded under the ticker “ECOR3”. The Company is mainly engaged in operating road, port, and logistics service concession assets, and companies rendering services related to such activities. EcoRodovias current portfolio includes seven road service concession arrangements, one logistics platform (Elog) and one port asset (Ecoporto) in seven states, located in the main commercial roads of Southern and Southeastern Brazil. The Company is headquartered at Rua Gomes de Carvalho, 1.510 - conjuntos 31 e 32, in the City and State of São Paulo (SP).
The Company’s direct and indirect subsidiaries (“EcoRodovias Group”) are listed in Note 2.
Conclusion and issue of these financial statements were approved by the Company’s Executive Board on February 20, 2017.
2. PRESENTATION OF FINANCIAL STATEMENTS
2.1. Statement of compliance and basis of preparationThe Company’s financial statements comprise:
a) Consolidated financial statements The Company’s consolidated financial
statements were prepared in accordance with
the International Financial Reporting Standards (IFRS), issued by the International Accounting Standards Board (IASB), and interpretations issued by the International Financial Reporting Interpretations Committee (IFRIC), implemented in Brazil through the Brazilian FASB (CPC) and its technical interpretations (ICPC) and guidance (OCPC), approved by the Brazilian Securities and Exchange Commission (CVM).
b) Individual financial statements - Company The Company’s individual financial
statements were prepared in accordance with accounting practices adopted in Brazil, which comprise provisions set forth in the Brazilian Corporation Law (Law No. 6406/76), as amended by Laws No.11638/07 and No.11941/09, and accounting pronouncements, interpretations and guidance issued by the Brazilian Financial Accounting Standards Board (CPC), approved by the Brazilian Securities and Exchange Commission (CVM).
The financial statements were prepared based on historical cost, except for certain financial instruments measured at fair value.
Significant accounting practices adopted by the Group are described in specific notes that relate to the items presented, and the ones that generally apply to different aspects in the financial statements are described below:
The Company’s financial statements present comparative information for the prior year.
NOTES TO FINANCIAL STATEMENTS December 31, 2016 and 2015(In thousands of - R$, unless otherwise stated)
SUSTAINABILITY REPORT 2016 17
FINANCIAL STATEMENTS
2.2. Basis of consolidation and investments in subsidiariesAn affiliate is an entity on which the Company exer-cises significant influence. Significant influence is the power of participating in the decisions on the inves-tees’ operating policies; however, it does not mean to control or have joint control on these policies.
Joint venture is a joint business on which the parties that hold common control on the business have rights on the business’ net assets. Common control is the contractually agreed sharing of the business control that exists only when decisions on the significant activities require the unanimous consent from the parties that share the control.
The Company’s investment in its affiliate and joint venture is recorded under the equity method.
The financial statements of the affiliates are prepared for the same reporting period as that of the Company. Whenever necessary, adjustments are made so that accounting practices are in line with those adopted by the Company.
The interest held in subsidiaries and jointly-controlled entities, all of which are domiciled in Brazil, is as follows:
12/31/2016 12/31/2015 CORE BUSINESS ACTIVITY
Direct subsidiaries:
EcoRodovias Concessões e Serviços S.A. 100.00% 100.00%
Interest in other companies, either as an owner or shareholder, in addition to providing administrative, financial, human resources, information technology, engineering, and corporate purchases services.
EIL01 Participações Ltda 100.00% 100.00% Interest in other companies, either as an owner or shareholder.
Ecoporto Santos S.A. 100.00% 100.00%Port operations, handling and storage of import and export cargo in the port of Santos.
Termares - Terminais Marítimos Especializados Ltda. 100.00% 100.00% Handling and storage of import and
export cargo under customs control.
Ecoporto Transporte Ltda. - 100.00%
Internal handling of containers of the companies Ecoporto Santos and Termares, and serving the part load transportation and distribution market.
ELG-01 Participações Ltda. 100.00% - Interest in other companies, either as an owner or shareholder.
Elog S.A. - 100.00%Provision of general warehousing activities and specific logistics services. Holding of the Company’s logistics segment.
12/31/2016 12/31/2015 CORE BUSINESS ACTIVITY
Jointly-controlled entities:
Consórcio Rota do Horizonte S.A. 20.00% 20.00% Exploration of the Northern Beltway in the metropolitan region of Belo Horizonte.
ECORODOVIAS18
2.3. Service concession arrangementsThe Company’s main service concession arrangements presented by entity are as follows:
I) Concessionária Ecovias dos Imigrantes S.A. Runs the Anchieta-Imigrantes highway system,
which is 176.8 km long, which consists basically of the following highways: a) Anchieta highway (SP-150 - from km 9.7 to km 65.6); (b) Imigrantes highway (SP-160 - from km 11.5 to km 70.0); (c) Planalto road link (SP-041 - 8-km long); (d) Baixada road link (SP-059 - 1.8-km long); (e) Padre Manoel da Nóbrega highway (SP-055/170) - from km 270.6 to km 292.2); and (f) Cônego Domênico Rangoni highway (SP-055/248 - from km 0 to km 8.4 and km 248.0 to km 270.6. This service concession arrangement was recorded as an intangible asset and will be effective through October 2025.
II) Concessionária das Rodovias Ayrton Senna e Car-valho Pinto S.A. - Ecopistas
Ecopistas operates a set of highway lanes of Ayrton Senna-Carvalho Pinto corridor, related rights of way and buildings, facilities and equipment therein, which is 134.9 km long. This arrangement was recorded as an in-tangible asset and will be effective through June 2039.
III) Concessionária Ecovia Caminho do Mar S.A. Operates a highway totaling 136.7 km, comprising:
(a) BR-277 highway stretch between the City of
Curitiba and the Port of Paranaguá, which is 85.7 km long; b) PR- 508 highway stretch linking BR-277 highway and the City of Matinhos, which is 32 km long; and c) PR-407 highway stretch linking BR-277 Highway and Praia de Leste, which is 19 km long. This arrangement was recorded as an intangible asset and will be effective through 2021.
IV) Rodovia das Cataratas S.A. - Ecocataratas Operates a highway totaling 387.1 km, located
between the cities of Guarapuava and Foz do Iguaçu, both in the State of Paraná. This arrangement was classified as intangible assets and is effective for 24 years (the concession expires on November 13, 2021).
V) Empresa Concessionária de Rodovias do Sul S.A. - Ecosul
Operates the following highways and stretches:
12/31/2016 12/31/2015 CORE BUSINESS ACTIVITY
Indirect subsidiaries:
Subsidiaries via EcoRodovias Concessões e Serviços S.A.
Concessionária Ecovias dos Imigrantes S.A. 100.00% 100.00%
Operation under concession of the highway system consisting of the Anchieta-Imigrantes System.
Concessionária das Rodovias Ayrton Senna e Carvalho Pinto S.A. - Ecopistas 100.00% 100.00%
Operation through collection of tolls and subsidiary revenues under the terms and limits of the service concession arrangement.
Concessionária Ecovia Caminho do Mar S.A. 100.00% 100.00%
Operation under concession of Lot 006 of the Highway Concession Program of the State of Paraná.
Rodovia das Cataratas S.A. - Ecocataratas 100.00% 100.00%
Operation under concession of Lot 003 of the Highway Concession Program of the State of Paraná.
Empresa Concessionária de Rodovias do Sul S.A. - Ecosul 90.00% 90.00%
Operation under concession of certain highway stretches comprising of the so called Pelotas Hub.
ECO101 Concessionária de Rodovias S.A. 58.00% 58.00% Operation of BR-101 ES/BA Highway System under concession.
Concessionária Ponte Rio-Niterói S.A. Ecoponte 100.00% 100.00%
Operation of BR-101/RJ Highway System under concession – access road to Ponte Presidente Costa e Silva (Niterói) – access to RJ-071 (Linha Vermelha), “Ponte Rio- Niterói”.
HIGHWAY STRETCH LENGTH (KM)
BR-116 Pelotas/Camaquã 123.4
BR-116 Pelotas/Jaguarão 137.1
BR-392 Pelotas/Rio Grande 125.6
BR-392 Pelotas/Santana da Boa Vista 123.0
SUSTAINABILITY REPORT 2016 19
FINANCIAL STATEMENTS
The service concession arrangement term classified as intangible asset is estimated for March 2026. Upon concession termination, all reversible assets, rights and rewards related to the operation of the highway system shall return to the Granting Authority. The Company will be entitled to indemnification corresponding to the balance not amortized or depreciated of assets or investments, whose acquisition or execution, duly authorized by the Granting Authority, occurred in the last five years of the concession period.
VI) ECO101 Concessionária de Rodovias S.A. Operates, under concession, BR-101 ES/BA
Federal Highway System, between BA - 698 highway (access to the city of Mucuri, State of Bahia - BA) up to the border of Espírito Santo (ES) and Rio de Janeiro (RJ) States. The 25-year concession (from the date of assumption and transfer of assets on May 10, 2013) comprises the operation of the infrastructure and provision of recovery, public operation, maintenance, monitoring and upkeeping services, implementation of improvements and extension of the capacity of BR101/EX/BA highway systems, between BA-698 (access to Mucuri-BA) until the border of ES/RJ, remunerated by the toll collection and other sources of ancillary revenue. In the event that the concession is terminated, in May 2038, all reversible assets, rights and rewards related to the operation of the highway system shall return to the Granting Authority.
On December 22, 2015, the Company’s Board of Directors approved the transfer, through sale, of all of its 87,000,058 shares representing 58% of the capital of ECO101 Concessionária de Rodovias S.A. to its direct subsidiary Companhia Ecorodovias Concessões e Serviços S.A.
VII) Ecoporto Santos S.A.The lease agreement entered into between Companhia Docas do Estado de São Paulo - CODESP and Ecoporto Santos S.A. is a 25-year agreement. Five addenda to the agreement were entered into, however; such terms do not change the term of the agreement, which shall mainly expire on June 12, 2023. The Sixteenth Clause to the agreement provides for its extension duly requested up to 12 months prior to the expiration date. The Granting Authority may grant such extension to the extent that Ecoporto Santos has met all legal and contractual obligations. After the establishment of the new sector regulatory framework, the Granting Authority will become the Special
Secretariat of Ports (SEP), recently merged into the Brazilian Department of Transportation, Ports and Civil Aviation (MTPAC), and the National Water Transportation Agency (ANTAQ) will be responsible for the inspection and regulation of the sector. Additionally, concerning the agreement extension, compliance with provisions of SEP Ordinance No. 349/2014 and ANTAQ Resolution No. 3220/2014 is deemed necessary, which require that Ecoporto Santos request be accompanied by an Investment Plan, and Environmental, Technical and Economic Feasibility Study (EVTEA), as well as by information required to evaluate compliance with existing contractual obligations. Ecoporto Santos requested contract extension, and instructed the process with relevant documentation. The investment plan was preliminarily approved by the MTPAC through Administrative Ruling No. 702, of December 8, 2016, and submitted to ANTAQ for analysis and deliberation. Pursuant to current legislation, and MTPAC Administrative Ruling No. 702, management considers that the changes to recognize the right to extend the lease agreement are high, provided that Ecoporto performance is maintained, and considering ANTAQ Resolution No. 3220/2014 and SEP Administrative Ruling No. 349/2014, particularly the feasibility study for the new agreement period. Therefore, the public interest in the continuance of the activities will be maintained and Ecoporto Santos will rely on it. It should be noted that two class actions 0010874-75.2002.403.6104 and 0002925-92.2005.4.03.6104 (1st Federal Court of Santos Subsection), now at the 3rd Region Federal Regional Court, challenging the validity of the agreement and its addenda. In 2015, the Federal Regional Court of the 3rd Region dismissed the appeal filed by the Company. The proceeding has been suspended for 180 days. After this period, there are appeals requesting clarification of decisions pending judgment by the 3rd Region Federal Regional Court. Those decisions, if sustained, shall be appealed in higher courts.
Company management maintains its belief in the end result of the proceedings based on opinions of renowned attorneys and the results of administrative proceedings on the same issue. Decisions were handed down under Representation No. 012194/2002-1 of the Court of Federal Auditors and ANTAQ Administrative Litigation Proceeding No. 50300.000155/2013-62 on the same issue, recognizing the possibility of an extension of the lease agreement. The amortization and
ECORODOVIAS20
depreciation term considers the extension of the concession for more than 25 years (up to 2048) and management assesses this scenario on an annual basis.
VIII) Concessionária Ponte Rio-Niterói S.A. EcoponteOn May 18, 2015, the Company, through its subsidiary Concessionária Ponte Rio- Niterói S.A. – Ecoponte, entered into a service concession arrangement for the operation of the infrastructure and provision of public operation, maintenance, monitoring and upkeeping services and implementation of improvements of the highway system of BR-101/RJ, remunerated by the toll collection within 30 years beginning June 1, 2015: an access road leading to Ponte Presidente Costa e Silva (in the city of Niterói) - access to RJ-071 (Linha Vermelha), “Ponte Rio-Niterói”.
On December 22, 2015, the Company’s Board of Directors approved the transfer, through sale, of all of its 120,000,000 shares representing 100% of the capital of Concessionária Ponte Rio-Niterói S.A. - Ecoponte to its direct subsidiary Companhia Ecorodovias Concessões e Serviços S.A.
2.4. Functional and reporting currencyThe financial statements of the parent company and its subsidiaries, included in the consolidated financial sta-tements, are stated in Reais, currency of the principal economic environment in which the Companies opera-te (“functional currency”).
3. SUMMARY OF SIGNIFICANT ACCOUNTING PRACTICESSignificant accounting practices described below were applied consistently for the years presented and for the individual financial statements of Company and Consolidated:
a) Transactions and balances denominated in foreign currency
Foreign currency-denominated transactions are translated into the Company’s functional currency (the Real) by the exchange rate prevailing on the transaction dates. Account balances in the statement of financial position denominated in foreign currency are converted at the exchange rate prevailing at the dates of the statements of financial position. Exchange gains and losses arising from the settlement of these transactions and from the conversion of monetary assets and liabilities denominated in foreign currency are recognized in profit or loss for the year.
b) Financial instruments
i) Financial assets Financial assets are classified as: (i) financial
assets at fair value through profit or loss; (ii) loans and receivables; (iii) investments held to maturity; or (iv) financial assets available for sale. The Company determines the classification of its financial assets upon initial recognition, when they become a party to the contractual provisions of the instrument.
The Company’s financial assets include cash and cash equivalents, trade accounts receivable, other receivables and financial instruments.
Subsequent measurement
Measurement of financial liabilities depends on their classification:
• Loansandreceivables Loans and receivables include cash and cash
equivalents, accounts receivable and other receivables. Loans and receivables are mea-sured at amortized cost, using the effective interest rate method, less any impairment loss. Amortization of the effective interest method or financial expenses (impairment loss) is pre-sented under financial income (expenses) in the statement of operations.
• Financialassetsmeasuredatfairvaluethroughprofit or loss
Financial assets at fair value through profit or loss include financial assets held for trading and financial assets designated upon initial recogni-tion at fair value through profit or loss. Financial assets are classified as held for trading if acqui-red to be sold within short term.
Financial assets at fair value through profit or loss are stated in the statement of financial position at fair value, and their corresponding gains or losses are recognized in the statement of operations.
Derecognition
A financial asset is mainly derecognized when:
• Therightstoreceivecashflowsfromtheassethave expired;
• TheCompanyhastransferreditsrightsto receive cash flows of the asset or has assumed an obligation to fully pay the
SUSTAINABILITY REPORT 2016 21
FINANCIAL STATEMENTS
cash flows received, without significant delay to a third party under a pass-through arrangement, and (a) the Company transferred substantially all risks and rewards of the asset, or (b) the Company has neither transferred nor retained substantially all risks and rewards related to the asset, but has transferred control over the asset. At December 31, 2016, except for the share-based payment plan (phantom stock/restricted stock), there are no financial assets at fair value.
Impairment of financial assetsThe Company assesses, at the dates of the statements of financial position, whether there is any objective evidence of impairment of the financial asset or of a group of financial assets, based on one or more events that have occurred after the initial recognition of the asset with impact on the estimated future cash flows of the financial asset or group of financial assets that can be reliably estimated.
ii) Financial liabilities Financial liabilities are initially recognized at fair
value plus, in the case of loans and financing, debentures and accounts payable, transaction cost directly attributable thereto.
The Company’s financial liabilities include trade accounts payable, other accounts payable, loans and financing, debentures and financial guarantee agreements.
Subsequent measurementSubsequent measurement of financial liabilities depends on their classification, which can be as follows:
• Loansandfinancingandfinancelease After initial recognition, loans and financing
and finance lease subject to interest are subsequently measured at amortized cost, using the effective interest method. Gains and losses are recognized in the income statement when liabilities are derecognized, and through the amortization process by the effective interest method.
• Financialguaranteeagreements Financial guarantee agreements issued
by the Company refer to agreements requiring the payment for purposes of reimbursement of the holder due to losses incurred when specified debtor fails to perform the due payment under the
terms provided for in the debt instrument. Financial guarantee agreements are initially recognized as a liability at fair value, adjusted by transaction costs directly related to the guarantee issuance. Subsequently, the liability is measured based on the best estimate of expense required to settle the obligation existing at the date of the statement of financial position or in the amount recognized less amortization, whichever is higher.
DerecognitionA financial liability is derecognized when the liability has been revoked, cancelled or has expired. When an existing financial liability is replaced by another of the same lender with substantially different terms, or the terms of an existing liability are significantly changed, this replacement or change is treated as derecognition of the original liability with recognition of a new liability, the difference in the respective carrying amount being recognized in the statement of operations.
iii) Financial instruments, netFinancial assets and liabilities are stated net in the statement of financial position if, and only if, there is a current enforceable legal right to set off the amounts recognized and if there is the intention to offset or realize the asset and settle the liability simultaneously.
Through December 31, 2016, there were no significant indemnities.
c) Impairment of non-financial assetsManagement annually tests the net carrying amount of assets in order to determine whether there are any events or changes in economic, operating or technological circumstances that may indicate deterioration or impairment loss. When such evidence is identified and the net carrying amount exceeds the recoverable amount, a provision for impairment is set up to adjust the net carrying amount to the recoverable amount.
The following criteria are applied to assess the im-pairment loss of specific assets:
Goodwill paid on expected future profitability
Impairment testing of goodwill is performed at least once a year (at December 31) or when
ECORODOVIAS22
circumstances indicate impairment loss due to devaluation of carrying amount.
Intangible assets
Intangible assets with indefinite useful lives are tested for impairment on an annual basis at December 31, either individually or at the cash generating unit level, as applicable or when circumstances indicate impairment of the carrying amount.
d) General provisions Provisions are recorded when the Company
has a present (legal or constructive) obligation arising from past events, the settlement of which is expected to result in an outflow of economic benefits, in an amount that can be reliably estimated. When the Company expects that the amount of a provision will be reimbursed, whether in full or in part, the reimbursement is recognized as a separate asset, but only when the amount is more likely than not to be reimbursed. The expense related to any provision is presented in the statement of operations.
e) Business combination Business combinations are recorded under
the acquisition method. The cost of an acquisition is measured by the sum of the consideration transferred based on fair value on the acquisition date and the value of any equity held by noncontrolling members in the acquired party. For each business combination the acquirer shall measure noncontrolling interest in the acquiree at fair value or based on its interest in net assets identified in the acquiree. Costs directly attributable to the acquisition shall be recorded as expenses when incurred.
Goodwill is initially measured as that which exceeds the consideration transferred in relation to net assets acquired (identifiable acquired net assets and liabilities assumed).
If the consideration is lower than fair value of acquired net assets, the difference shall be recognized as gain in the statement of operations.
f) Present value adjustment of assets and liabilities
Long-term monetary assets and liabilities were stated at present value on the transaction dates due to its terms, using
the average rate of financial charges incurred when they were raised, both for customers and for suppliers. The present value adjustment of current monetary assets and liabilities is calculated and only recorded when the effect is considered significant in relation to the overall financial statements. For purposes of recording and determining significance, present value adjustment is calculated taking into consideration the contractual cash flows and the explicit, and in certain circumstances implicit, interest rate of the respective assets and liabilities.
g) Borrowing costs Borrowing costs directly attributable to the
acquisition, construction or production of an asset that necessarily takes a substantial period of time to get ready for its intended use or sale are capitalized as part of the underlying asset cost. All other borrowing costs are expensed in the period they are incurred.
h) Assets and liabilities held for sale An operation is classified as discontinued
at the earlier of its disposal or when it meets the criteria do be classified as held for sale. When an operation is classified as a discontinued operation, the comparative statements of operations and cash flows are presented as if the operation had been discontinued since the beginning of the comparative period. Therefore, the “reclassified” observation was included in the December 31, 2015 statements.
These assets are measured at the lower of the carrying amount or fair value less costs to sell.
When classified as held for sale, intangible assets and property and equipment are not amortized or depreciated.
Profit or loss of the discontinued operation is presented in a single amount in the statement of operations, including total profit or loss after income and social contribution taxes of those operations.
i) Standards, amendments and interpretations to standards
(i) Standards and interpretations issued but not yet adopted until the date of issue of the Company’s financial statements are disclosed as follows: The Company expects to adopt
SUSTAINABILITY REPORT 2016 23
FINANCIAL STATEMENTS
these standards, if applicable, when they become effective:
STANDARD REQUIREMENTIMPACT ON FINANCIAL STATEMENTS
IFRS 9 - Financial Instruments
The objective of IFRS 9 is ultimately to replace IAS 39. Main changes estimated are: (i) all financial assets shall be initially recognized at fair value; (ii) the standard divides all financial assets into: amortized cost and fair value; and (iii) the concept of embedded derivatives was extinguished.
Company management has assessed IFRS 9 impacts and understands that its adoption will anticipate no material impact on its financial statements.
IFRS 15 – Revenue from Contracts with Customers
The main purpose is to provide clear principles to recognize revenue and to simplify the process of preparation of financial assets.
Company management has assessed IFRS 15 impacts and understands that its adoption will anticipate no material impact on its financial statements.
Amendment to IFRS 10 and IAS 28 - Joint Venture
The purpose is to clarify that the gain or loss resulting from the sale or contribution of assets of a business, as defined in IFRS 3, between an investor and its affiliate or joint venture, are recognized in full.
Company management has assessed the impacts of the amendment to IFRS 10 and IAS 28 and understands that its adoption will anticipate no material impact on its financial statements.
Amendment to IAS 7 (Effective from 01/01/2017)
The purpose is to disclose information to users so they can assess changes in liabilities resulting from financing activities.
Company management has assessed IAS 7 impacts and understands that its adoption will anticipate no material impact on its financial statements.
Amendment to IAS 12 (Effective from 01/01/2017)
The purpose is to clarify that an entity shall consider whether the tax legislation restricts sources of taxable profit against which it may make deductions on reversal of this temporarily deductible difference.
Company management has assessed IAS 12 impacts and understands that its adoption will anticipate no material impact on its financial statements.
Amendment to IFRS 2 (Effective from 01/01/2017)
The purpose is to clarify classification and measurement of share-based payment transactions.
Company management has assessed IFRS 2 impacts and understands that its adoption will anticipate no material impact on its financial statements.
IFRS 16 – Lease agreements (Effective from 01/01/2019)
The new standard sets principles, both for the customer (the lessee) and the supplier (lessor), on the provision of significant information about leases so that commercial lease transactions are clearly shown in the financial statements. Accordingly, the lessor must recognize the assets and liabilities resulting from the lease agreement.
Company management has assessed IFRS 16 impacts and understands that its adoption will anticipate no material impact on its financial statements.
4. MAIN USES OF ESTIMATES AND JUDGMENTSManagement of the Company and its subsidiaries make estimates and assumptions regarding future events. Estimates and assumptions that present a significant risk, likely to cause a significant adjustment to carrying amounts of assets and liabilities for the next financial year are as follows:
• Discountrate:determinationofdiscountrates to present value used in the measurement of certain current and noncurrent assets and liabilities;
• Amortizationrate:determinationofamortizationrates of intangible assets obtained through economic studies of traffic projection; and
• Provisions:determinationofprovisionsformaintenance, determination of provisions for future investments arising from service concession arrangements whose economic benefits are diluted in current toll fees, provisions for tax, labor and civil losses, losses on accounts receivable and preparation of projections to realize deferred income and social contribution taxes.
ECORODOVIAS24
Service concession arrangement accountingUpon recording the Service Concession Arrangement, the Company conducts analyses involving manage-ment judgment, substantially regarding the application of the Service Concession Arrangement interpretation, determination and classification of improvement and construction expenses as intangible assets, and asses-sment of future economic benefits for the purpose of determining the time to recognize intangible assets generated in the Service Concession Arrangement. Disclosures for each Company’s service concession arrangement and their characteristics are described in Note 2.3.
Recognition of intangible assetsCompany management assesses the moment intangible assets are to be recognized, based on economic characteristics of each service concession arrangement. Accounting for subsequent additions to intangible assets will only occur upon related services rendered representing potential generation of additional revenue. For these cases, for example, the construction liability is not recognized upon execution of the contract, but it will constitute a liability by the time the construction is carried out, matched against intangible asset.
Determining annual amortization of intangible assets arising from service concession arrangementsThe Company recognizes the effect of amortizing in-tangible assets arising from the service concession arrangement limited to the respective concession term, except for direct subsidiary Ecoporto Santos S.A., for which the Company already considers the service concession arrangement assuming renewal. This is calculated according to the consumption standard of the economic benefit generated, usually based on the traffic curve. Thus, the amortization rate is determined through economic studies intended to reflect projected growth of highway traffic and the generation of future economic benefits arising from the service concession arrangement. The Company uses models to study and project traffic on highways under its concession.
Determining construction revenuesConstruction revenue is recognized at its fair value, as well as related costs changed into expenses related to the construction service provided. In accordance with the Application of Accounting Interpretation (ICPC) 01, where a public service concessionaire performs construction works, even if contractually provided for, it performs construction services. The rendering of these services originate two types of compensation: either by receiving values from the Granting Autho-rity (financial asset) or through payment of toll fees (intangible asset). For this last type, which is the case for all highway concession operators administered
by the Company, the construction revenue shall be recognized at its fair value, and the costs changed into expenses for the construction service provided. Upon recording construction margins, Company ma-nagement evaluates issues related to the primary responsibility for providing construction services, even in cases where there is outsourcing of services, ma-nagement costs and/or monitoring of the work and EcoRodovias Group that carries out the construction services. Company management believes that the hi-ring of construction services are carried out at market value; therefore, the Company recognizes no profit margin on construction activities.
Company management assesses and recognizes the effects of present value adjustment, taking into con-sideration the time value of money and uncertainties related thereto. At December 31, 2016 and 2015, assets and liabilities subject to present value adjustment and significant assumptions adopted by management to measure and recognize them are as follows:
(a) Provision for maintenance and future works arising from estimated expenses to comply with contractual obligations of the concession whose economic benefits are already being earned by the Company, and provision for maintenance stemming from estimated costs to meet the contractual obligations of the concession related to the use and maintenance of roads at predetermined levels of use. Measurement of present values of these provisions was calculated using cash flow projection method on the dates outflow of resources are estimated, to meet their respective obligations (estimated for the full concession period), and discounted by applying the discount rate, which varies between 11.52% and 16.28% p.a. Determination of the discount rate used by management is based on the weighted average of fundings. Measurement and criteria of the respective values are detailed in Notes 24 and 25.
(b) Concession rights payable arising from obligations incurred by the Company related to grant deed. Measurement and criteria of the respective values are described in Note 26.
5. ACQUISITION OF INTEREST IN ELOG S.A.On May 19, 2015, the Company disclosed to the market that it had been informed by BRZ Investimentos Ltda., manager of Logística Brasil - Fundo de Investimento em Participações (“Logística Brasil”) about the exercise of the put option rights of all shares held by Logística Brasil S.A. in Elog S.A., equivalent to 20% (twenty percent) of total and voting capital of Elog S.A. in accordance with the
SUSTAINABILITY REPORT 2016 25
FINANCIAL STATEMENTS
Shareholders’ Agreement (“Put Option”). The value of the put option at April 30, 2015, totaled R$214,000 and was monetarily restated by reference to the IPCA + 6% per year until its settlement, which occurred on June 26, 2015, in the amount of R$218,470. On July 16, 2015, the 2nd tranche was settled by reference to the IPCA of the end of June, amounting to R$830 and totaling R$219,300.
After completion of the sale carried out on June 26, 2015, the Company became holder of 100% of total and voting capital of Elog S.A., thus controlling it, and started to fully consolidate its effects according to CPC 36 (R3) - Consolidated Financial Statements.
Since the acquisition of its equity control, Elog S.A. contributed the amounts of R$172,516 of net income and R$26,978 of loss, in the Company’s consolidated statement of operations for the year ended December 31, 2015.
Had the acquisition occurred at the beginning of 2015, the Company’s consolidated net revenue would have been R$3,044,998 and profit would have been R$95,636.
Fair value of identifiable assets and liabilities of Elog S.A. as of acquisition date is as follows:
Related parties 8,134
Social charges payable 13,966
Provision for income and social contribution taxes
607
Other accounts payable 17,163
Provision for labor, tax and civil risks 37,021
Total liabilities 460,695
Total identifiable assets, net (b) 581,245
Consideration transferred to sellers 219,300
Fair value of the interest formerly held
513,973
Total consideration (a) 733,273
GOODWILL ON ACQUISITION (A) – (B) 152,028
Assets 06/26/2015
Cash and cash equivalents 20,774
Trade accounts receivable 46,347
Taxes recoverable 4,880
Related parties 370
Prepaid expenses 4,038
Other receivables 2,861
Escrow deposits 40,513
Deferred taxes 76,273
Other receivables 12,208
Property and equipment 315,643
Intangible assets 518,033
Total assets 1,041,940
Liabilities
Trade accounts payable 20,951
Taxes payable 6,800
Loans and financing 19,972
Debentures 323,745
Dividends and interest on equity payable
12,336
>> CONTINUATION
>> CONTINUED
Goodwill paid comprises the amount of future eco-nomic benefits from the acquisition and the amount of workforce that could not be recognized separately, thus it does not meet the criteria for recognition as an intangible asset, according to CPC 04 - Intangible Assets. There is no expectation that goodwill will gene-rate future tax benefits.
The consideration transferred includes the amount paid in accordance with the Put Option terms and fair value of 80% interest that the Company holds in Elog S.A. immediately prior to the purchase of ownership control. The difference between the fair value amoun-ting to R$513,973 and the carrying amount amounting to R$415,315 of the interest held was recognized in the period (R$98,658) under “Other income”.
At December 31, 2016, the Company carried out an impairment analysis on the goodwill acquired and recorded a loss in the amount of R$90,807 under “Other expenses”. This loss is due to the fact that the Company paid an amount that exceeded market value (under contract) for the acquisition of 20% of the vo-ting capital of Elog S.A., as referred to above.
6. ASSETS AND LIABILITIES HELD FOR SALE
a) Sale of equity interest According to the material fact notices published to
the market on July 4, 2016, the Company through its subsidiary Elog S.A., entered into an Agreement for Purchase and Sale of Units of Interest on July 2, 2016, whereby the terms and conditions for disposal of 100% of Elog Logística Sul Ltda., Maringá Serviços Auxiliares de Transporte Aéreo Ltda and Maringá Ar-mazéns Gerais Ltda. (jointly, “Elog Sul Units”) capital to Multilog S.A. Completion of the disposal was sub-ject to certain conditions precedent, which include
ECORODOVIAS26
communication and/or approval by the Brazilian IRS, and approval by the Administrative Council for Eco-nomic Defense (CADE), which was approved with no restrictions on July 29, 2016. The operation was com-pleted on October 6, 2016, with effective transfer of units of interest and settlement for R$115,000 (*).
The amount of loss on investment sale amounting to R$12.080 is carried under “Net income from assets and liabilities held for sale”, in the statement of operations.
Disposal of Elog Sul Units is in line with the EcoRodovias Group strategy to focus on road concession assets.
(*) On February 1, 2017, as provided for in the purchase and sale
agreement clauses, price was adjusted with payment of R$1,172 to
the Company. The sale totaled R$116,172.
The effects arising from the sale of these interests are as follows:
ASSETS ELOG SUL MARINGÁS GOODWILL TOTAL
Current assets
Cash and cash equivalents 3,470 1,619 - 5,089
Trade accounts receivable 12,070 412 - 12,482
Related parties 120 161 - 281
Taxes recoverable 531 14 - 545
Prepaid expenses 74 - - 74
Other receivables 590 10 - 600
Total current assets 16,855 2,216 - 19,071
Noncurrent assets
Escrow deposits 9,803 1,095 - 10,898
Deferred taxes 3,389 163 - 3,552
Other receivables 963 - - 963
Goodwill recorded in Company - - 88,282 88,282
Property and equipment and intangible assets 33,188 1,173 - 34,361
Total noncurrent assets 47,343 2,431 88,282 138,056
Total assets 64,198 4,647 88,282 157,127
LIABILITIES AND EQUITY
Current liabilities
Trade accounts payable 4,247 121 - 4,368
Taxes payable 1,666 1,150 - 2,816
Social liabilities 2,564 33 - 2,597
Dividends and interest on equity payable 5,978 - - 5,978
Related parties 1,602 81 - 1,683
Provision for income and social contribution taxes 588 - - 588
Other accounts payable 940 299 - 1,239
Total current liabilities 17,585 1,684 - 19,269
Noncurrent liabilities
Provision for labor, tax and civil risks 9,566 - - 9,566
Other accounts payable 40 - - 40
Total noncurrent liabilities 9,606 - - 9,606
Equity 37,007 2,963 88,282 128,252
Total liabilities and equity 64,198 4,647 88,282 157,127
Total sale amount - - - 116,172
Loss on investment disposal (total equity – sale amount) - - - (12,080)
SUSTAINABILITY REPORT 2016 27
FINANCIAL STATEMENTS
The purchase and sale agreement has an indemnity clause, which provides for the Company’s respon-sibility to indemnify the purchaser in the event of losses incurred, events after the sale closing date, including and litigations related to existing con-tingent liability. The agreement provides for the following limitations:
(i) Indemnity obligation is limited to the minimum of R$10 per individual loss and maximum of 25% (twenty-five percent) of the acquisition price, only in certain hypotheses. In other cases, the amount is limited to 50% (fifty percent) of the acquisition price;
(ii) The indemnity payment term is 10 (ten) wor-king days from receipt of notification informing the indemnity;
(iii) The time limit may be 3 (three), 5 (five), 6 (six) or 10 (ten) years, according to the nature of the respective loss.
At December 31, 2016, no events that could lead to indemnity payment to purchasers were identified and, therefore no amount was provisioned.
b) Assets and liabilities held for sale Based on the EcoRodovias Group strategy
to focus upon road concession assets, the Company also classified as discontinued operations its investments in the logistics segment through companies Elog S.A. and Ecopátio Logística Cubatão Ltda, expecting that disposal takes place within 12 years after these were classified as assets and liabilities held for sale.
Pursuant to CVM Rule No. 598/09, which approved accounting pronouncement CPC 31 – Noncurrent Assets held for sale and Discontinued Operation, assets and liabilities of these units were classified under Assets and Liabilities from discontinued operations, and information thereon will no longer be an integral part of the Company’s consolidated information.
These related assets and liabilities shall be measured at the lower of their carrying amounts and fair value less costs to sell.
At December 31, 2016, assets and liabilities held for sale comprised:
ASSETS COMBINED (*) LIABILITIES COMBINED (*)
12/31/2016 12/31/2016
Cash and cash equivalents 15,647 Trade accounts payable 11,460
Trade accounts receivable 33,100 Loans and financing 2,187
Related parties 2,774 Debentures 183,788
Taxes payable 2,902
Taxes recoverable 1,693 Social and labor liabilities 6,502
Prepaid expenses 496 Related parties 458
Other receivables 5,185 Other accounts payable 22,719
Deferred taxes 123,738Provision for labor, tax and civil contingencies
33,560
Escrow deposits 43,909Provision for income and social contribution taxes
-
Property and equipment 12,109
Intangible assets 14,597
TOTAL ASSETS HELD FOR SALE 253,248 TOTAL LIABILITIES HELD FOR SALE 263,576
(*) These amounts refer to combined assets and liabilities of companies Elog S.A. and Ecopátio Logística Cubatão Ltda., already adjusted to fair value, in
addition to R$10,328 expected as future disbursements necessary to sell these assets and liabilities, recorded under “Other accounts payable”.
After classification, an impairment loss amoun-ting to R$689,301 was recognized for the carrying amount of these assets to be reduced to fair value
less costs to sell. This amount was recognized in profit or loss under “Loss for the period of discon-tinued operations”. An evaluation was conducted
ECORODOVIAS28
to determine the fair values of companies Elog S.A. and Ecopátio Logística Cubatão Ltda, based on multiple recent transactions involving similar assets in the same market segment, and on the very tran-saction of Elog Sul with Multilog S.A.
The result of the fair value evaluation as a result of the classification as assets and liabilities held for sale is as follows:
CONSOLIDATED
Selling amount (a) 160,000
Net debt (b) (170,328)
AMOUNT IN THE STATEMENT OF FINANCIAL POSITION OF ASSETS AND LIABILITIES HELD FOR SALE (C) (10,328)
12/31/2016 12/31/2015
Net revenue 292,533 324,573
Cost of services rendered (262,906) (273,199)
Gross profit 29,627 51,374
Operating and financial income (expenses) (41,038) (54,482)
Financial income (expenses) (42,826) (47,427)
Operating income (expenses) (54,237) (50,535)
Income and social contribution taxes 51,218 30,525
Profit or loss from assets and liabilities held for sale (3,019) (20,010)
Fair value measurement effect of assets and liabilities held for sale (*) (686,282) -
Noncontrolling interests - 4,169
Net loss from assets and liabilities held for sale (689,301) (15,841)
CONSOLIDATED
Fair value adjustment of intangible assets and property and equipment (572,502)
Fair value adjustment of dividends and IOE (12,336)
Capital contributions (January to December 2016) (88,097)
Fair value adjustment of other assets and liabilities (3,019)
Fair value effect of assets and liabilities held for sale (675,954)
Expected contribution amounts necessary for maintenance of net working capital (10,328)
Fair value adjustment of assets and liabilities held for sale (686,282)
The Company recorded loss on the discontinued operation of its direct parent company Elog S.A. in the amount of R$689,301, of which (R$90,000) refers to the estimated selling amount; R$170,328 net debt expected; R$20,486 amount in the statements of financial position of assets, and R$408,487 costs of assets held for sale.
(a) Estimated cost of disposal for companies Elog S.A. and Ecopátio Logística Cubatão Ltda., to-taling R$160,000.
(b) Refers to net debt at December 31, 2016 of subsidiaries classified as discontinued operations.
(c) Refers to net value between assets and liabili-ties measured at the lower of carrying amounts and fair value less costs to sell.
Profit or loss for the year ended December 31, 2016 re-lated to assets and liabilities held for sale is as follows:
Profit or loss from discontinued operations
(*) Statement of fair value adjustment of assets and liabilities held for sale:
SUSTAINABILITY REPORT 2016 29
FINANCIAL STATEMENTS
Cash flow from assets and liabilities held for sale
12/31/2016 12/31/2015
Profit or loss for the year (3,019) (15,841)
Items that do not affect cash (92,650) 39,764
Items that do not affect cash – expected contribution 3,614 -
Resulting from changes in financial position (16,231) (2,249)
Used in investing activities 211,308 (233,735)
Used in financing activities (222,606) (16,702)
ASSETS AND LIABILITIES HELD FOR SALE, NET OF CASH (119,584) (228,763)
CONSOLIDATED
12/31/2016
NET
CARRYING AMOUNT
NET RECOVERABLE
AMOUNT
NET IMPAIRMENT ADJUSTMENT TO PROFIT OR LOSS FOR THE YEAR
Goodwill – port segment (a) 666,668 365,671 300,997
Deferred taxes – port segment (b) 450,699 206,689 244,010
ASSETS AND LIABILITIES HELD FOR SALE, NET OF CASH 1,117,367 572,360 545,007
7. IMPAIRMENT OF ASSETS
Since the beginning of 2015, a fall in the volume of business in the port segment was noticed, as a result of the economic downturn that directly impacted the activities of the Company and its subsidiaries. At December 31, 2015, impairment was not required yet. In 2016, given the continuing fall in volume and prices, and the non-confirmation of a new ship-owner, and considering the projections for the following periods, at June 30, 2016, the Company recognized a R$545,007 reduction in its non-financial assets.
(a) Value in use of goodwill was restated to reflect management’s best
estimates in relation to its business in Santos Port. The evaluation is
still sensitive to changes, if any, in long-term expectations that may
lead to future adjustments to the amount recognized. The discount
rate applied in the future cash flow projection represents the WACC
of the Company’s port segment. The statutory rate used was 13.1%
p.a., and the Company considered market sources to define inflation
and foreign exchange rates used in future flow projections.
(b) Tax credits arising from: a) income and social contribution tax los-
ses; and b) downstream merger goodwill were reviewed based on
the expected future taxable profit generation in the port segment,
in light of legal limitations. Future taxable profit projections were
prepared based on the review of the subsidiary’s business plan.
The review generated a R$244,010 write-off (see Deferred Taxes,
in Note 18) (R$40,191 tax loss in 2016; R$140,808 tax losses prior to
2016, and R$63,011 downstream merger goodwill). The company will
physically keep amounts for future use.
ECORODOVIAS30
8. CASH AND CASH EQUIVALENTS
Accounting practiceThe Company considers cash equivalents a short-term investment readily convertible into a known
COMPANY CONSOLIDATED
12/31/2016 12/31/2015 12/31/2016 12/31/2015
Cash and banks 13 76 32,806 33,186
Short-term investments:
Investment fund (a) 638 62,523 517,844 575,216
Repurchase agreements (b) 2,226 - 25,018 150,079
Automatic investments - Repurchase agreements (c) 219 274 13,836 14,422
3,096 62,873 589,504 772,903
CONSOLIDATED
31/12/2016 31/12/2015
Investment fund (a) 66,430 47,765
Savings account (b) 1,961 2,585
Current account (c) 728 -
69,119 50,350
Current 61,748 49,666
Noncurrent 7,371 684
(a) Fund organized as an investment fund, classified as “private fixed in-
come fund”, pursuant to the prevailing regulation, whose investment
policy’s main risk factor is the variation in the domestic interest rate
or price index, or both, and whose goal is to seek the appreciation of
its shares through the investment of funds in a conservative portfolio.
It may be redeemed at any time, without significant loss in value.
The Fund cannot invest in speculative transactions or transactions
that expose it to liabilities higher than its net assets. The Fund can-
not be exposed to certain assets, such as shares, share indices and
derivatives indexed thereto.
At December 31, 2016, the investment fund’s portfolio consisted of 30.3%
in Bank Deposit Certificate (CDB), 60.8% in Repurchase Agreements, and
3.9% in LFs (Brazilian T-financial bills), and 5.0% in Government bonds.
The financial investments linked thereto bear interest at 100.7%
(101.3% at December 31, 2015) of the Interbank Deposit Certificate
(CDI), and reflect the market conditions at the dates of the state-
ment of financial position.
(b) The funds related to consolidated repurchase agreements bear
interest at weighted average rate of 89.9% of the Interbank Deposit
Certificate (CDI), without risk of material change in value. The refer-
red to investment is highly liquid.
(c) The Company holds a short-term investment in Itaú Unibanco, in
which the funds available in current accounts are automatically in-
vested and bear interest pursuant to the period they remain invested
and may vary from 10% to 20% of the CDI. The group maintains only
a minimum balance in this type of investment and the exceeding
volume is allocated to more profitable short-term investments, and
this type is maintained at an average rate of 10.0% of CDI (short-term
investments stay between one and 14 days), without the risk of signi-
ficant change in value. The referred to investment is highly liquid.
Bank (BNDES) as a guarantee for part of the payment of indirect subsi-
diaries Concessionária de Rodovias Ayrton Senna e Carvalho Pinto S.A.
and Eco101 Concessionária de Rodovias S.A., and of the debentures of
indirect subsidiary Concessionaria de Rodovias Ayrton Senna e Carvalho
Pinto S/A - Ecopistas.
(b) This refers to the Environmental Compensation Commitment Instrument
entered into by indirect subsidiaries Ecopistas and Ecoporto Santos and
Companhia Ambiental do Estado de São Paulo (CETESB), which will use
the funds as environmental compensation with respect to lawsuits to be
determined and approved by the Environmental Compensation Cham-
ber (CCA). The amounts are restated by reference to the savings rate.
There is a balance in the same amount recognized in noncurrent liabilities
related to this obligation.
(c) Amounts classified as marketable securities – as these are restricted to
the Company’s financing agreements with the BNDES as guarantee of
part of the payment of interest and principal, of subsidiary Eco101 Con-
cessionária de Rodovias S.A.
cash amount and subject to insignificant risk of change in value.
9. MARKETABLE SECURITIESMarketable securities consist of temporary high liquidity short-term investments:
(a) Investment funds bear interest of 97.8% (98.9% at December 31, 2015) of
the CDI and reflect market conditions at the dates of the statement of
financial position. Although these investments are highly convertible to
cash, they were classified as marketable securities since they are related
to the Company’s financing agreement with the Brazilian Development
SUSTAINABILITY REPORT 2016 31
FINANCIAL STATEMENTS
10. TRADE ACCOUNTS RECEIVABLE
Breakdown of trade accounts receivable is as follows:
CONSOLIDATED
12/31/2016 12/31/2015
Domestic (a) 156,158 207,127
Foreign (b) - 651
Allowance for doubtful accounts (ADA) (c) (1,368) (9,799)
154,790 197,979
CONSOLIDATED
12/31/2016 12/31/2015
Falling due 149,784 191,028
Past due:
Within 30 days 2,389 3,027
From 31 to 90 days 1,060 2,852
From 91 to 120 days 1,557 1,072
Above 120 days 1,368 9,799
156,158 207,778
CONSOLIDATED
12/31/2016 12/31/2015
Opening balance 9,799 3,759
Elog acquisition - 5,181
Assets and liabilities held for sale (*) (6,254) 2,116
Amounts recovered and written off for the year (2,919) (2,222)
Setup of allowance for doubtful accounts for the year 742 965
CLOSING BALANCE 1,368 9,799
(a) Represented substantially by electronic toll, lease of land along the
highways, lease of billboards, access by port logistics customers and
other services.
(b) Substantially represented by customers in the port segment.
The aging list of receivables is as follows:
Changes in allowance for doubtful accounts
(c) Refers to the recognition of the allowance for doubtful accounts mainly
for port operations, and the Company’s policy credit determines that
doubtful accounts relate to notes overdue for more than 120 days.
(*) As mentioned in Note 6, the Company classified company Elog S.A. and some of its subsidiaries as assets and liabilities held for sale.
ECORODOVIAS32
11. TAXES RECOVERABLE
COMPANY CONSOLIDATED
12/31/2016 12/31/2015 12/31/2016 12/31/2015
Withholding Income Tax (IRRF) recoverable 5,218 9,070 22,157 33,499
Corporate Income Tax (IRPJ) – prior years 28,119 26,173 34,669 28,314
Social Contribution Tax on Net Profit (CSLL) recoverable - - 2,480 2,429
Social contribution tax on gross revenue for social integration program (PIS) and for social security financing (COFINS) recoverable
- - 1,405 -
PIS and COFINS recoverable on inputs - - - 1,927
Service Tax (ISS) recoverable - - 158 532
Other - - 13 1,254
33,337 35,243 60,882 67,955
12/31/2014 PROPOSED RECEIVED 12/31/2015
ASSETS AND LIABILITIES HELD
FOR SALE (*) PROPOSED RECEIVED 12/31/2016
Elog S.A. 12,336 - - 12,336 (12,336) - - -
EcoRodovias Concessões e Serviços S.A.
- 347,461 (347,461) - - 470,202 (435,990) 34,212
Termares - Terminais Marítimos Especializados Ltda.
- 9,515 (7,324) 2,191 - 5,973 (7,979) 185
Consórcio Rota do Horizonte S.A.
222 1,120 (1,342) - - - - -
Concessionária Ponte Rio Niteroi - Ecoponte
- 17,217 (17,217) - - - - -
12,558 375,313 (373,344) 14,527 (12,336) 476,175 (443,969) 34,397
12. DIVIDENDS AND INTEREST ON EQUITY RECEIVABLE - COMPANY
(*) As mentioned in Note 6, the Company classified company Elog S.A. and some of its subsidiaries as assets and liabilities held for sale. The amount
of R$12,336 refers to the Dividend and IOE balance receivable from subsidiary Elog S.A., reversed in capital contribution upon write-off of the
discontinued operation.
13. PREPAID EXPENSES – CONSOLIDATEDThe balance of R$18,334, classified as current and noncurrent assets (R$8,988 at December 31, 2015) refers to: (i) unallocated insurance premiums
(further details on insurance taken out are in Note 38), (ii) leases (iii) municipal real property tax (IPTU) and (iv) maritime mediation.
SUSTAINABILITY REPORT 2016 33
FINANCIAL STATEMENTS
14. ESCROW DEPOSITSEscrow deposits representing the Company’s restricted assets refer to amounts deposited in escrow and held in courts until the related litigation is resolved.
INVESTEES12/31/2016
PERCENTAGE OF DIRECT INTEREST - %
INVESTMENTEQUITY PICKUP
EquityProfit or loss for the year
12/31/2016 12/31/2015 12/31/2016 12/31/2015 12/31/2016 12/31/2015
Elog S.A. (i) - - - 100 - 231,772 (1,059) (1,719)
EcoRodovias Concessões e Serviços S.A. 878,786 508,185 100 100 878,786 840,035 508,185 380,997
EIL 02 S.A. 1 - 100 100 1 1 - -
EIL 03 S.A. - - 100 100 - - - (1)
EIL 04 S.A. - - 100 100 - - - (1)
EIL-01 Participações Ltda. 317 22 100 100 317 295 22 22
Ecoporto Santos S.A. 45,508 (311,028) 100 100 45,509 154,208 (311,028) (105,786)
Termares - Terminais Marítimos Especializados Ltda. 9,656 4,886 100 100 9,655 17,409 4,886 13,706
Ecoporto Transporte Ltda. - (11,895) - 100 - (1,085) (11,896) (8,509)
ELG-01 Participações Ltda 55,447 (2,106) 100 - 55,447 - (1,048) -
ECO101 Concessionária de Rodovias S.A. (ii) - - - 58 - - - (164)
Concessionária Ponte Rio-Niterói S.A. - Ecoponte (ii) - - - 100 - - - 20,474
Consórcio Rota do Horizonte S.A. 5,085 (42) 20 20 1,017 1,025 (8) 1,773
Unrealized income - - - - (7,676) (8,055) 379 (1,166)
983,056 1,235,605 188,433 299,626
(*) As mentioned in Note 6, the Company classified company Elog S.A. and some of its subsidiaries as assets and liabilities held for sale. At Decem-
ber 31, 2016, the amount transferred was R$45,757 (R$40,513 at December 31, 2015).
15. INVESTMENTS
a) Company
COMPANY CONSOLIDATED
12/31/2016 12/31/2015 12/31/2016 12/31/2015
Opening balance 1,949 1,783 211,119 130,447
Assets and liabilities held for sale (*) - - (45,757) 40,513
Additions 55 - 10,041 20,094
Write-offs - - (4,719) (2,592)
Monetary restatement 144 166 3,329 22,657
CLOSING BALANCE 2,148 1,949 174,013 211,119
(i) See Notes 5 and 6. The amount of R$1,059 refers to the remaining balance of ELG-01 Participações Ltda. equity pickup. On September 29, 2016, transfer of
investments of ELC-01 Participações Ltda to the Company was resolved through capital reduction in Elog S.A.
ECORODOVIAS34
INVESTEES12/31/2016
PERCENTAGE OF DIRECT INTEREST - %
INVESTMENTEQUITY PICKUP
EquityProfit or loss for the year
12/31/2016 12/31/2015 12/31/2016 12/31/2015 12/31/2016 12/31/2015
Elog S.A. (i) - - - 100 - 231,772 (1,059) (1,719)
EcoRodovias Concessões e Serviços S.A. 878,786 508,185 100 100 878,786 840,035 508,185 380,997
EIL 02 S.A. 1 - 100 100 1 1 - -
EIL 03 S.A. - - 100 100 - - - (1)
EIL 04 S.A. - - 100 100 - - - (1)
EIL-01 Participações Ltda. 317 22 100 100 317 295 22 22
Ecoporto Santos S.A. 45,508 (311,028) 100 100 45,509 154,208 (311,028) (105,786)
Termares - Terminais Marítimos Especializados Ltda. 9,656 4,886 100 100 9,655 17,409 4,886 13,706
Ecoporto Transporte Ltda. - (11,895) - 100 - (1,085) (11,896) (8,509)
ELG-01 Participações Ltda 55,447 (2,106) 100 - 55,447 - (1,048) -
ECO101 Concessionária de Rodovias S.A. (ii) - - - 58 - - - (164)
Concessionária Ponte Rio-Niterói S.A. - Ecoponte (ii) - - - 100 - - - 20,474
Consórcio Rota do Horizonte S.A. 5,085 (42) 20 20 1,017 1,025 (8) 1,773
Unrealized income - - - - (7,676) (8,055) 379 (1,166)
983,056 1,235,605 188,433 299,626
SUSTAINABILITY REPORT 2016 35
FINANCIAL STATEMENTS
12/31/2016
ASSETS LIABILITIES STATEMENT OF OPERATIONSATTRIBUTABLE
TO:
Current assets
Noncurrent assets
Current liabilities
Noncurrent liabilities
EquityNet
revenueGross profit
Operating income/loss
Net income/loss for
the yearCompany
Noncontrollingshareholders
Direct subsidiaries:
EcoRodovias Concessões e Serviços S.A. 227,773 2,480,941 180,342 1,649,586 878,786 163,820 72,056 504,067 508,185 508,185 -
EIL01 Participações S.A. 318 - 1 - 317 - - 29 22 22 -
EIL02 S.A. 1 - - - 1 - - - - - -
EIL03 S.A. - - - - - - - - - - -
EIL04 S.A. - - - - - - - - - - -
ELG-01 Participações Ltda. 20 55,427 - - 55,447 - - (2,106) (2,106) (2,106) -
Ecoporto Santos S.A. 28,585 675,936 225,096 433,917 45,508 138,944 54,776 (110,909) (311,028) (311,028) -
Termares - Terminais Marítimos Especializados Ltda. 15,827 27,046 26,058 7,160 9,655 113,977 79,356 6,683 4,886 4,886 -
Ecoporto Transporte Ltda. - - - - - 5,025 (4,668) (7,243) (11,895) (11,895) -
Indirect subsidiaries:
Via EcoRodovias Concessões e Serviços S.A.:
Concessionária Ecovias dos Imigrantes S.A. 400,145 1,435,071 135,896 1,298,460 400,860 942,796 563,058 409,848 280,140 280,140 -
Concessionária das Rodovias Ayrton Senna e Carvalho Pinto S.A. - Ecopistas
88,332 1,303,943 168,855 724,976 498,444 360,906 146,312 29,495 22,134 22,134 -
Concessionária Ecovia Caminho do Mar S.A. 31,454 200,790 182,349 7,115 42,780 247,917 154,868 116,167 75,078 75,078 -
Rodovia das Cataratas S.A. - Ecocataratas 99,022 387,246 287,723 63,578 134,967 312,641 144,514 88,187 56,145 56,145 -
Empresa Concessionária de Rodovias do Sul S.A. - Ecosul
25,937 255,587 189,680 12,303 79,541 296,947 162,720 121,521 80,261 72,235 8,026
ECO101 Concessionária de Rodovias S.A. 27,838 472,491 86,865 259,587 153,877 258,425 58,259 26,953 17,766 10,304 7,462
Concessionária da Ponte Rio Niterói S.A. -Ecoponte 71,511 134,661 47,056 35,421 123,695 164,883 68,170 63,486 43,859 43,859 -
Via ELG-01 Participações Ltda.
Anish Empreendimentos e Participações Ltda. 188 63,937 784 8,124 55,217 22 22 (2,067) (2,067) (2,067) -
Paquetá Participações Ltda. 4 11,000 - - 11,004 - - (146) (146) (146) -
ECORODOVIAS36
12/31/2016
ASSETS LIABILITIES STATEMENT OF OPERATIONSATTRIBUTABLE
TO:
Current assets
Noncurrent assets
Current liabilities
Noncurrent liabilities
EquityNet
revenueGross profit
Operating income/loss
Net income/loss for
the yearCompany
Noncontrollingshareholders
Direct subsidiaries:
EcoRodovias Concessões e Serviços S.A. 227,773 2,480,941 180,342 1,649,586 878,786 163,820 72,056 504,067 508,185 508,185 -
EIL01 Participações S.A. 318 - 1 - 317 - - 29 22 22 -
EIL02 S.A. 1 - - - 1 - - - - - -
EIL03 S.A. - - - - - - - - - - -
EIL04 S.A. - - - - - - - - - - -
ELG-01 Participações Ltda. 20 55,427 - - 55,447 - - (2,106) (2,106) (2,106) -
Ecoporto Santos S.A. 28,585 675,936 225,096 433,917 45,508 138,944 54,776 (110,909) (311,028) (311,028) -
Termares - Terminais Marítimos Especializados Ltda. 15,827 27,046 26,058 7,160 9,655 113,977 79,356 6,683 4,886 4,886 -
Ecoporto Transporte Ltda. - - - - - 5,025 (4,668) (7,243) (11,895) (11,895) -
Indirect subsidiaries:
Via EcoRodovias Concessões e Serviços S.A.:
Concessionária Ecovias dos Imigrantes S.A. 400,145 1,435,071 135,896 1,298,460 400,860 942,796 563,058 409,848 280,140 280,140 -
Concessionária das Rodovias Ayrton Senna e Carvalho Pinto S.A. - Ecopistas
88,332 1,303,943 168,855 724,976 498,444 360,906 146,312 29,495 22,134 22,134 -
Concessionária Ecovia Caminho do Mar S.A. 31,454 200,790 182,349 7,115 42,780 247,917 154,868 116,167 75,078 75,078 -
Rodovia das Cataratas S.A. - Ecocataratas 99,022 387,246 287,723 63,578 134,967 312,641 144,514 88,187 56,145 56,145 -
Empresa Concessionária de Rodovias do Sul S.A. - Ecosul
25,937 255,587 189,680 12,303 79,541 296,947 162,720 121,521 80,261 72,235 8,026
ECO101 Concessionária de Rodovias S.A. 27,838 472,491 86,865 259,587 153,877 258,425 58,259 26,953 17,766 10,304 7,462
Concessionária da Ponte Rio Niterói S.A. -Ecoponte 71,511 134,661 47,056 35,421 123,695 164,883 68,170 63,486 43,859 43,859 -
Via ELG-01 Participações Ltda.
Anish Empreendimentos e Participações Ltda. 188 63,937 784 8,124 55,217 22 22 (2,067) (2,067) (2,067) -
Paquetá Participações Ltda. 4 11,000 - - 11,004 - - (146) (146) (146) -
SUSTAINABILITY REPORT 2016 37
FINANCIAL STATEMENTS
Changes in investments for the year ended December 31, 2016 are as follows:
12/31/2015
ASSETS HELD FOR
SALE(A)
PROPOSED DIVIDENDS AND
INTEREST ON EQUITY
SUPPLEMENTAR Y DIVIDENDS
2015MERGER
CAPITAL CONTRIBUTION
STOCK OPTION PLAN
TRANSFER OF CONTROL (C)
EQUITY PICKUP
12/31/2016
EcoRodovias Concessões e Serviços S.A. 840,035 - (470,202) - - - 768 - 508,185 878,786
EIL-01 Participações Ltda. 295 - - - - - - - 22 317
EIL02 S.A. 1 - - - - - - - - 1
EIL03 S.A. - - - - - - - - - -
EIL04 S.A. - - - - - - - - - -
Elog S.A.(a) 231,772 (231,772) - - - 1,059 (1,059) -
Ecoporto Santos S.A. 154,208 - - - - 202,000 329 - (311,028) 45,509
Termares Terminais Marítimos Especializados Ltda.
17,409 - (5,973) (1,886) (4,781) - - - 4,886 9,655
Ecoporto Transporte Ltda. (1,085) - - - 4,781 8,200 - - (11,896) -
Consórcio Rota do Horizonte S.A. 1,025 - - - - - - - (8) 1,017
ELG01 Participações Ltda.(b) - - - - - 785 - 55,710 (1,048) 55,447
Unrealized income (8,055) - - - - - - - 379 (7,676)
1,235,605 (231,772) (476,175) (1,886) - 210,985 1,097 56,769 188,433 983,056
12/31/2014
PROPOSED DIVIDENDS AND
INTEREST ON EQUITY
CAPITAL REDUCTION
ACQUISITION OF INTEREST
CAPITAL CONTRIBUTION
STOCK OPTION
PLAN
TRANSFER OF CONTROL (C)
ASSETS HELD FOR SALE (A)
EQUITY PICKUP
12/31/2015
EcoRodovias Concessões e Serviços S.A. 805,177 (347,461) - - - 1,322 - - 380,997 840,035
EIL-01 Participações Ltda. 273 - - - - - - - 22 295
EIL02 S.A. 1 - - - - - - - - 1
EIL03 S.A. 1 - - - - - - - (1) -
EIL04 S.A. 1 - - - - - - - (1) -
Elog S.A. 201,262 - - 45,919 30,009 - - (43,699) (1,719) 231,772
Concessionária da Ponte Rio Niterói S.A. Ecoponte (c)
- (17,217) - - 84,000 43 (87,300) - 20,474 -
Ecoporto Santos S.A. 26,860 - - - 232,614 520 - - (105,786) 154,208
Termares Terminais Marítimos Especializados Ltda.
70,185 (9,515) (56,967) - - - - - 13,706 17,409
Ecoporto Transporte Ltda. 7,424 - - - - - - - (8,509) (1,085)
ECO101 Concessionária de Rodovias S.A. (c) 70,599 - - - - - - - (164) -
Consórcio Rota do Horizonte S.A. 55,172 (1,120) (54,800) - - 90 (70,525) - 1,773 1,025
Unrealized income (6,889) - - - - - - - (1,166) (8,055)
1,230,066 (375,313) (111,767) 45,919 346,623 1,975 (157,825) (43,699) 299,626 1,235,605
(a) See Note 6.
(b) On September 29, 2016, transfer of investments of ELC-01 Participações was resolved through capital reduction in Elog S.A.
Changes in investments for the year ended December 31, 2015 are as follows:
(c) See Note 12.
ECORODOVIAS38
12/31/2015
ASSETS HELD FOR
SALE(A)
PROPOSED DIVIDENDS AND
INTEREST ON EQUITY
SUPPLEMENTAR Y DIVIDENDS
2015MERGER
CAPITAL CONTRIBUTION
STOCK OPTION PLAN
TRANSFER OF CONTROL (C)
EQUITY PICKUP
12/31/2016
EcoRodovias Concessões e Serviços S.A. 840,035 - (470,202) - - - 768 - 508,185 878,786
EIL-01 Participações Ltda. 295 - - - - - - - 22 317
EIL02 S.A. 1 - - - - - - - - 1
EIL03 S.A. - - - - - - - - - -
EIL04 S.A. - - - - - - - - - -
Elog S.A.(a) 231,772 (231,772) - - - 1,059 (1,059) -
Ecoporto Santos S.A. 154,208 - - - - 202,000 329 - (311,028) 45,509
Termares Terminais Marítimos Especializados Ltda.
17,409 - (5,973) (1,886) (4,781) - - - 4,886 9,655
Ecoporto Transporte Ltda. (1,085) - - - 4,781 8,200 - - (11,896) -
Consórcio Rota do Horizonte S.A. 1,025 - - - - - - - (8) 1,017
ELG01 Participações Ltda.(b) - - - - - 785 - 55,710 (1,048) 55,447
Unrealized income (8,055) - - - - - - - 379 (7,676)
1,235,605 (231,772) (476,175) (1,886) - 210,985 1,097 56,769 188,433 983,056
12/31/2014
PROPOSED DIVIDENDS AND
INTEREST ON EQUITY
CAPITAL REDUCTION
ACQUISITION OF INTEREST
CAPITAL CONTRIBUTION
STOCK OPTION
PLAN
TRANSFER OF CONTROL (C)
ASSETS HELD FOR SALE (A)
EQUITY PICKUP
12/31/2015
EcoRodovias Concessões e Serviços S.A. 805,177 (347,461) - - - 1,322 - - 380,997 840,035
EIL-01 Participações Ltda. 273 - - - - - - - 22 295
EIL02 S.A. 1 - - - - - - - - 1
EIL03 S.A. 1 - - - - - - - (1) -
EIL04 S.A. 1 - - - - - - - (1) -
Elog S.A. 201,262 - - 45,919 30,009 - - (43,699) (1,719) 231,772
Concessionária da Ponte Rio Niterói S.A. Ecoponte (c)
- (17,217) - - 84,000 43 (87,300) - 20,474 -
Ecoporto Santos S.A. 26,860 - - - 232,614 520 - - (105,786) 154,208
Termares Terminais Marítimos Especializados Ltda.
70,185 (9,515) (56,967) - - - - - 13,706 17,409
Ecoporto Transporte Ltda. 7,424 - - - - - - - (8,509) (1,085)
ECO101 Concessionária de Rodovias S.A. (c) 70,599 - - - - - - - (164) -
Consórcio Rota do Horizonte S.A. 55,172 (1,120) (54,800) - - 90 (70,525) - 1,773 1,025
Unrealized income (6,889) - - - - - - - (1,166) (8,055)
1,230,066 (375,313) (111,767) 45,919 346,623 1,975 (157,825) (43,699) 299,626 1,235,605
SUSTAINABILITY REPORT 2016 39
FINANCIAL STATEMENTS
The balances of goodwill in the Company classified as “Other investments” (reclassified to intangible assets and property and equipment in consolidated) are as follows:
12/31/2014ACQUISITION
(*)WRITE-OFF (*)
IMPAIRMENT (*)
AMORT. 12/31/2015IMPAIRMENT
(*)AMORT. 12/31/2016
Goodwill - Ecosul
5,782 - - - (513) 5,269 - (516) 4,753
Goodwill - Elog
231,584 524,272 (231,638) (90,807) 129 433,540 (395,796) - 37,744
Goodwill - Ecoporto
705,818 - - - (26,100) 679,718 (300,997) (21,467) 357,254
943,184 524,272 (231,638) (90,807) (26,484) 1,118,527 (696,793) (21,983) 399,751
(*) See Notes 6 and 7
b) Consolidated
INVESTEES12/31/2016
PERCENTAGE OFDIRECT INTEREST - %
INVESTMENTEQUITY PICKUP
EquityProfit or loss for the year
12/31/2016 12/31/2015 12/31/2016 12/31/2015 12/31/2016 12/31/2015
Consórcio Rota do Horizonte S.A. 5,085 (40) 20 20 1,017 1,025 (8) 1,773
Elog S.A. (a) - - - 100 - - - (911)
1,017 1,025 (8) 862
(a) See Note 5
16. PROPERTY AND EQUIPMENT
Accounting policyProperty and equipment are stated at historical cost less respective depreciation and impairment losses, if applicable. A property and equipment item is de-recognized on disposal or when no future economic benefit is expected from its use or sale. Any gains or losses arising therefrom are classified in the income statement for the year in which the asset is derecog-nized. Net book value and useful lives of assets and
depreciation methods are reviewed at year end and adjusted prospectively. Depreciation of property and equipment items is calculated on the straight-line ba-sis and takes into consideration the estimated useful life of the assets. Average depreciation rates are pre-sented for each group of assets, as follows.
a) Company
COST DEPRECIATION NET BOOK VALUE
AVERAGE DEPRECIATION
RATES - %
BALANCES AT12/31/2014
ADDITIONS WRITE-OFFSBALANCES AT
12/31/2015BALANCES AT
12/31/2014 ADDITIONS
BALANCES AT 12/31/2015
12/31/2015 12/31/2014
Hardwares 10.4 1,229 32 - 1,261 (895) (129) (1,024) 237 334
Machinery and equipment 9.3 248 - - 248 (214) (23) (237) 11 34
Furniture and fixtures 10.2 547 2 - 549 (361) (56) (417) 132 186
Buildings 3.9 1,956 - - 1,956 (607) (76) (683) 1,273 1,349
Construction in progress - 84 32 - 116 - - - 116 84
Other 8.5 3,383 12 (95) 3,300 (1,185) (280) (1,465) 1,835 2,198
7,447 78 (95) 7,430 (3,262) (564) (3,826) 3,604 4,185
ECORODOVIAS40
INVESTEES12/31/2016
PERCENTAGE OFDIRECT INTEREST - %
INVESTMENTEQUITY PICKUP
EquityProfit or loss for the year
12/31/2016 12/31/2015 12/31/2016 12/31/2015 12/31/2016 12/31/2015
Consórcio Rota do Horizonte S.A. 5,085 (40) 20 20 1,017 1,025 (8) 1,773
Elog S.A. (a) - - - 100 - - - (911)
1,017 1,025 (8) 862
COST DEPRECIATION NET BOOK VALUE
AVERAGE DEPRECIATION
RATES - %
BALANCES AT12/31/2014
ADDITIONS WRITE-OFFSBALANCES AT
12/31/2015BALANCES AT
12/31/2014 ADDITIONS
BALANCES AT 12/31/2015
12/31/2015 12/31/2014
Hardwares 10.4 1,229 32 - 1,261 (895) (129) (1,024) 237 334
Machinery and equipment 9.3 248 - - 248 (214) (23) (237) 11 34
Furniture and fixtures 10.2 547 2 - 549 (361) (56) (417) 132 186
Buildings 3.9 1,956 - - 1,956 (607) (76) (683) 1,273 1,349
Construction in progress - 84 32 - 116 - - - 116 84
Other 8.5 3,383 12 (95) 3,300 (1,185) (280) (1,465) 1,835 2,198
7,447 78 (95) 7,430 (3,262) (564) (3,826) 3,604 4,185
SUSTAINABILITY REPORT 2016 41
FINANCIAL STATEMENTS
COST DEPRECIATION NET BOOK VALUE
AVERAGE DEPRECIATION
RATES - %
BALANCES AT12/31/2015
ADDITIONSWRITE-
OFFSTRANSFERS
BALANCES AT12/31/2016
BALANCES AT12/31/2015
ADDITIONSBALANCES AT
12/31/201612/31/2016 12/31/2015
Hardwares 8.7 1,261 40 (2) 18 1,317 (1,024) (113) (1,137) 180 237
Machinery and equipment 3.9 248 - - 10 258 (237) (10) (247) 11 11
Furniture and fixtures 7.3 549 - - - 549 (417) (40) (457) 92 132
Buildings 3.9 1,956 - - - 1,956 (683) (76) (759) 1,197 1,273
Construction in progress - 116 - - - 116 - - - 116 116
Other 8.5 3,300 304 - (119) 3,485 (1,465) (284) (1,749) 1,736 1,835
7,430 344 (2) (91) 7,681 (3,826) (523) (4,349) 3,332 3,604
COST DEPRECIATION NET BOOK VALUE
AVERAGE DEPRECIATION
RATES - %
BALANCES AT
12/31/2014ADDITIONS
WRITE- OFFS
TRANSF.ASSETS HELD FOR SALE (A)
ACQUIS. (B)
BALANCES AT
12/31/2015
BALANCES AT
12/31/2014ADDITIONS
WRITE- OFFS
ASSETS HELD FOR SALE (A)
TRANSF.ACQUIS.
(B)
BALANCES AT
12/31/2015 12/31/2015 12/31/2014
Hardwares 10.7 230,823 14,757 (82) 520 334 26,856 273,208 (162,042) (25,547) 8 (1,485) - (18,891) (207,957) 65,251 68,781
Machinery and equipment 7.8 172,158 37,831 (5,579) 94,503 719 60,278 359,910 (96,611) (21,918) 5,138 (3,062) - (30,236) (146,689) 213,221 75,547
Furniture and fixtures 7.7 24,354 1,439 (24) - 125 9,387 35,281 (10,181) (1,938) 16 (346) 75 (4,976) (17,350) 17,931 14,173
Land - 5,856 545 - - - 48,857 55,258 - - - - - - - 55,258 5,856
Buildings 4.4 35,539 400 - 3 - 120,182 156,124 (18,229) (1,578) - (2,478) (109) (13,630) (36,024) 120,100 17,310
Construction in progress - 39,146 25,222 - (12,284) 14,123 63,048 129,255 - - - - - - - 129,255 39,146
Improvements 2.4 200,954 1,290 - 1,515 3,108 42,881 249,748 (47,048) (4,848) - (1,064) - (18,553) (71,513) 178,235 153,906
Vehicles 17.6 31,462 1,161 (396) 277 - - 32,504 (15,950) (5,627) 385 - (5) - (21,197) 11,307 15,512
Facilities 11.2 24,104 6,509 (10) 593 1,531 42,522 75,249 (1,675) (3,118) - (2,052) 830 (19,758) (25,773) 49,476 22,429
Other 39.5 93,227 44,926 (5,946) (102,089) 835 17,149 48,102 (3,584) (3,023) - (1,760) 174 (9,473) (17,666) 30,436 89,643
857,623 134,080 (12,037) (16,962) 20,775 431,160 1,414,639 (355,320) (67,597) 5,547 (12,247) 965 (115,517) (544,169) 870,470 502,303
COST DEPRECIATION NET BOOK VALUE
AVERAGE DEPRECIATION
RATES %
BALANCES AT
12/31/2015
ASSETS HELD FOR SALE (A)
ADDITIONSWRITE-
OFFSTRANSF.
BALANCES AT
12/31/2016
BALANCES AT
12/31/2015
ASSETS HELD FOR SALE (A)
ADDITIONS WRITE- OFFS TRANSF.BALANCES
AT12/31/2016
12/31/2016 12/31/2015
Hardwares 9.5 273,208 (27,190) 7,474 (24) 1,211 254,679 (207,957) 20,375 (23,942) 17 12 (211,495) 43,184 65,251
Machinery and equipment 6.4 359,910 (61,722) 5,329 (3,641) 18 299,894 (146,689) 33,298 (19,124) 3,537 - (128,978) 170,916 213,221
Furniture and fixtures 7.5 35,281 (9,512) 1,248 (69) (308) 26,640 (17,350) 5,323 (1,943) 29 136 (13,805) 12,835 17,931
Land - 55,258 (113) 4 - 1 55,150 - - - - - - 55,150 55,258
Buildings 3.6 156,124 (109,071) - - 100 47,153 (36,024) 16,107 (1,702) - - (21,619) 25,534 120,100
Construction in progress - 129,255 (24,181) 952 - (119) 105,907 - - - - - - 105,907 129,255
Improvements 2.4 249,748 (50,564) 1,325 - - 200,509 (71,513) 19,617 (4,896) - - (56,792) 143,717 178,235
Vehicles 10.8 32,504 - 1,238 (336) - 33,406 (21,197) - (3,542) 336 - (24,403) 9,003 11,307
Facilities 9.7 75,249 (45,167) 3,489 (33) 1,199 34,737 (25,773) 21,810 (3,206) - (26) (7,195) 27,542 49,476
Other 6.1 48,102 (17,984) 8,231 (4,454) (2,866) 31,029 (17,666) 11,242 (1,630) - - (8,054) 22,975 30,436
1,414,639 (345,504) 29,290 (8,557) (764) 1,089,104 (544,169) 127,772 (59,985) 3,919 122 (472,341) 616,763 870,470
b) Consolidated
(a) See Note 6
(b) See Note 5
ECORODOVIAS42
COST DEPRECIATION NET BOOK VALUE
AVERAGE DEPRECIATION
RATES - %
BALANCES AT12/31/2015
ADDITIONSWRITE-
OFFSTRANSFERS
BALANCES AT12/31/2016
BALANCES AT12/31/2015
ADDITIONSBALANCES AT
12/31/201612/31/2016 12/31/2015
Hardwares 8.7 1,261 40 (2) 18 1,317 (1,024) (113) (1,137) 180 237
Machinery and equipment 3.9 248 - - 10 258 (237) (10) (247) 11 11
Furniture and fixtures 7.3 549 - - - 549 (417) (40) (457) 92 132
Buildings 3.9 1,956 - - - 1,956 (683) (76) (759) 1,197 1,273
Construction in progress - 116 - - - 116 - - - 116 116
Other 8.5 3,300 304 - (119) 3,485 (1,465) (284) (1,749) 1,736 1,835
7,430 344 (2) (91) 7,681 (3,826) (523) (4,349) 3,332 3,604
COST DEPRECIATION NET BOOK VALUE
AVERAGE DEPRECIATION
RATES - %
BALANCES AT
12/31/2014ADDITIONS
WRITE- OFFS
TRANSF.ASSETS HELD FOR SALE (A)
ACQUIS. (B)
BALANCES AT
12/31/2015
BALANCES AT
12/31/2014ADDITIONS
WRITE- OFFS
ASSETS HELD FOR SALE (A)
TRANSF.ACQUIS.
(B)
BALANCES AT
12/31/2015 12/31/2015 12/31/2014
Hardwares 10.7 230,823 14,757 (82) 520 334 26,856 273,208 (162,042) (25,547) 8 (1,485) - (18,891) (207,957) 65,251 68,781
Machinery and equipment 7.8 172,158 37,831 (5,579) 94,503 719 60,278 359,910 (96,611) (21,918) 5,138 (3,062) - (30,236) (146,689) 213,221 75,547
Furniture and fixtures 7.7 24,354 1,439 (24) - 125 9,387 35,281 (10,181) (1,938) 16 (346) 75 (4,976) (17,350) 17,931 14,173
Land - 5,856 545 - - - 48,857 55,258 - - - - - - - 55,258 5,856
Buildings 4.4 35,539 400 - 3 - 120,182 156,124 (18,229) (1,578) - (2,478) (109) (13,630) (36,024) 120,100 17,310
Construction in progress - 39,146 25,222 - (12,284) 14,123 63,048 129,255 - - - - - - - 129,255 39,146
Improvements 2.4 200,954 1,290 - 1,515 3,108 42,881 249,748 (47,048) (4,848) - (1,064) - (18,553) (71,513) 178,235 153,906
Vehicles 17.6 31,462 1,161 (396) 277 - - 32,504 (15,950) (5,627) 385 - (5) - (21,197) 11,307 15,512
Facilities 11.2 24,104 6,509 (10) 593 1,531 42,522 75,249 (1,675) (3,118) - (2,052) 830 (19,758) (25,773) 49,476 22,429
Other 39.5 93,227 44,926 (5,946) (102,089) 835 17,149 48,102 (3,584) (3,023) - (1,760) 174 (9,473) (17,666) 30,436 89,643
857,623 134,080 (12,037) (16,962) 20,775 431,160 1,414,639 (355,320) (67,597) 5,547 (12,247) 965 (115,517) (544,169) 870,470 502,303
COST DEPRECIATION NET BOOK VALUE
AVERAGE DEPRECIATION
RATES %
BALANCES AT
12/31/2015
ASSETS HELD FOR SALE (A)
ADDITIONSWRITE-
OFFSTRANSF.
BALANCES AT
12/31/2016
BALANCES AT
12/31/2015
ASSETS HELD FOR SALE (A)
ADDITIONS WRITE- OFFS TRANSF.BALANCES
AT12/31/2016
12/31/2016 12/31/2015
Hardwares 9.5 273,208 (27,190) 7,474 (24) 1,211 254,679 (207,957) 20,375 (23,942) 17 12 (211,495) 43,184 65,251
Machinery and equipment 6.4 359,910 (61,722) 5,329 (3,641) 18 299,894 (146,689) 33,298 (19,124) 3,537 - (128,978) 170,916 213,221
Furniture and fixtures 7.5 35,281 (9,512) 1,248 (69) (308) 26,640 (17,350) 5,323 (1,943) 29 136 (13,805) 12,835 17,931
Land - 55,258 (113) 4 - 1 55,150 - - - - - - 55,150 55,258
Buildings 3.6 156,124 (109,071) - - 100 47,153 (36,024) 16,107 (1,702) - - (21,619) 25,534 120,100
Construction in progress - 129,255 (24,181) 952 - (119) 105,907 - - - - - - 105,907 129,255
Improvements 2.4 249,748 (50,564) 1,325 - - 200,509 (71,513) 19,617 (4,896) - - (56,792) 143,717 178,235
Vehicles 10.8 32,504 - 1,238 (336) - 33,406 (21,197) - (3,542) 336 - (24,403) 9,003 11,307
Facilities 9.7 75,249 (45,167) 3,489 (33) 1,199 34,737 (25,773) 21,810 (3,206) - (26) (7,195) 27,542 49,476
Other 6.1 48,102 (17,984) 8,231 (4,454) (2,866) 31,029 (17,666) 11,242 (1,630) - - (8,054) 22,975 30,436
1,414,639 (345,504) 29,290 (8,557) (764) 1,089,104 (544,169) 127,772 (59,985) 3,919 122 (472,341) 616,763 870,470
SUSTAINABILITY REPORT 2016 43
FINANCIAL STATEMENTS
At December 31, 2016 and 2015, certain property and equipment items classified as “Other” (trucks and tow trucks), were pledged as collateral for loans and financing (see Note 20). For debentures (see Note 21) there are no such guarantees.
For the year ended December 31, 2016, the Company capitalized financial charges in the amount of R$6,628 (R$573 at December 31, 2015).
17. INTANGIBLE ASSETS
Accounting policyIntangible assets acquired separately are measured at cost upon their initial recognition. After initial recognition, intangible assets are stated at cost, less accumulated amortization and impairment. Intangible assets generated internally, excluding capitalized development costs, are not capitalized, and the expense is reflected in the inco-me statement for the year in which it incurs.
Amortization of intangible assets arising from the concession rights is recognized in P&L through a pro-jection of the traffic curve estimated for the concession period as from the date they are available for use, as
COST AMORTIZATION NET BOOK VALUE
AVERAGE AMORTIZATION
RATES (%)
BALANCES AT12/31/2014
ADDITIONSBALANCES AT
12/31/2015BALANCES AT
12/31/2014ADDITIONS
BALANCES AT12/31/2015
12/31/2015 12/31/2014
Third-party software 15.0 718 228 946 (333) (125) (458) 488 385
718 228 946 (333) (125) (458) 488 385
COST AMORTIZATION NET BOOK VALUE
AVERAGE AMORTIZATION
RATES (%)
BALANCES AT12/31/2015
ADDITIONS TRANSF.BALANCES AT
12/31/2016BALANCES AT
12/31/2015ADDITIONS
BALANCES AT12/31/2016
12/31/2016 12/31/2015
Third-party software 12.9 946 12 91 1,049 (458) (135) (593) 456 488
946 12 91 1,049 (458) (135) (593) 456 488
Company management identified no significant dif-ferences in the economic useful lives of the assets comprising the Company and its subsidiaries’ property and equipment items.
this is the method that better reflects the future econo-mic benefit consumption standard of the assets.
Goodwill allocated to concession rights, as well as rela-ted ones, but that have not been directly allocated to the concession or other assets and liabilities, which have a time-limited economic benefit (finite term) in view of the concession right with a finite useful life that comprise the intangible asset balance, are amortized considering the same criteria described in the preceding paragraph.
a) Company
ECORODOVIAS44
COST AMORTIZATION NET BOOK VALUE
AVERAGE AMORTIZATION
RATES (%)
BALANCES AT12/31/2014
ADDITIONSBALANCES AT
12/31/2015BALANCES AT
12/31/2014ADDITIONS
BALANCES AT12/31/2015
12/31/2015 12/31/2014
Third-party software 15.0 718 228 946 (333) (125) (458) 488 385
718 228 946 (333) (125) (458) 488 385
COST AMORTIZATION NET BOOK VALUE
AVERAGE AMORTIZATION
RATES (%)
BALANCES AT12/31/2015
ADDITIONS TRANSF.BALANCES AT
12/31/2016BALANCES AT
12/31/2015ADDITIONS
BALANCES AT12/31/2016
12/31/2016 12/31/2015
Third-party software 12.9 946 12 91 1,049 (458) (135) (593) 456 488
946 12 91 1,049 (458) (135) (593) 456 488
SUSTAINABILITY REPORT 2016 45
FINANCIAL STATEMENTS
b) Consolidated
COST AMORTIZATION NET BOOK VALUE
AVERAGE AMORTIZATIO N
RATES (%)
BALANCES AT
12/31/2014
ADDITIONS (I)
WRITE-OFFS
TRANSF.ASSETS
HELD FOR SALE
IMPAIRM.ACQUIS.
ELOG (IV)
BALANCES AT
12/31/2015
BALANCES AT
12/31/2014 ADDITIONS
WRITE-OFFS
ASSETS HELD FOR
SALETRANSF.
ACQUIS.ELOG
(IV)
BALANCES AT
12/31/2015 12/31/2015 12/31/2014
Service concession arrangements
(ii) 5,618,523 512,525 (428) 20,037 - - 161,988 6,312,645 (1,562,746) (263,777) 28 (6,503) (965) (58,465) (1,892,428) 4,420,217 4,055,777
Goodwill Ecosul - 8,561 - - - - - - 8,561 (2,778) (512) - - - - (3,290) 5,271 5,783
Third-party software
13.7 79,752 11,537 (34) 5,539 830 - 39,770 137,394 (45,638) (12,451) - (2,609) - (23,561) (84,259) 53,135 34,114
Intangible assets in progress
- 26,331 4,696 - (8,614) - - - 22,413 - - - - - - - 22,413 26,331
Goodwill Elog (iii) - 236,133 - (236,133) - 5,175 (90,807) 549,344 463,712 (4,552) 129 4,755 - - - 332 464,044 231,581
Other - 603 - (330) - 129 - 1,002 1,404 (36) - - (32) - (17) (85) 1,319 567
5,969,903 528,758 (236,925) 16,962 6,134 (90,807) 752,104 6,946,129 (1,615,750) (276,611) 4,783 (9,144) (965) (82,043) (1,979,730) 4,966,399 4,354,153
COST AMORTIZATION NET BOOK VALUE
AVERAGE AMORTIZATION
RATES (%)
BALANCES AT
12/31/2015
ADDITIONS (I)
WRITE-OFFS
TRANSF. IMPAIRM. (v)ASSETS
HELD FOR SALE (vi)
BALANCES AT
12/31/2016
BALANCES AT
12/31/2015 ADDITIONS
WRITE-OFFS
TRANSF.ASSETS HELD FOR SALE (vi)
BALANCES AT
12/31/201612/31/2016 12/31/2015
Service concession arrangements
(ii) 6,312,645 219,037 (2,687) 64,400 (300,997) (204,758) 6,087,640 (1,892,428) (265,259) - 15 64,959 (2,092,713) 3,994,927 4,420,217
Goodwill Ecosul - 8,561 - - - - - 8,561 (3,290) (512) - - - (3,802) 4,759 5,271
Third-party software 13.6 137,394 11,041 (109) 2,040 - (40,599) 109,767 (84,259) (14,210) - (138) 26,170 (72,437) 37,330 53,135
Intangible assets in progress - 22,413 244,845 (429) (65,676) - - 201,153 - - - - - - 201,153 22,413
Goodwill Elog (iii) - 463,712 - - - - (425,968) 37,744 332 - - - (332) - 37,744 464,044
Other - 1,404 - - - - (1,002) 402 (85) - - - 50 (35) 367 1,319
6,946,129 474,923 (3,225) 764 (300,997) (672,327) 6,445,267 (1,979,730) (279,981) - (123) 90,847 (2,168,987) 4,276,280 4,966,399
(i) The main acquisition amounts recorded in this line item refer to
highway renovations and improvements in the highway system
in general, such as in access roads and safety devices, cloverleaf
interchanges, bridge widening and reinforcement, construction
of additional lanes and lateral lanes, and highway widening. The
amounts are concentrated as follows; Eco101 - R$38,400, refer-
ring to initial works of the operation; Ecovias - R$63,929, the main
works referring to adjustment of the Cubatão cloverleaf interchange
and implementation of the 3rd lane from km 262 to 270 of SP055
highway; and Ecopistas - R$26,280, the major work referring to
construction of the marginal lane of Ayrton Senna Highway and also
expropriation of the extension of Carvalho Pinto Highway; and Eco-
via Caminho do Mar Highway - R$18,022, regarding the doubling of
Highway PR407 from KM0 to KM3.
(ii) The amortization of intangible assets arising from the concession
rights is recognized in P&L through the projected traffic curve
estimated for the concession period from the date on which they
are available for use, since this method reflects the pattern of con-
sumption of future economic benefits embodied in the asset. The
weighted average amortization rates as at December 31, 2016 were
on average 4.22% p.a. (4.48% p.a. at December 31, 2015).
(iii) In 2016, the net book value of R$425,968 (R$463,712 at December
31, 2015) was derecognized by virtue of CPC31 – Noncurrent assets
held for sale and discontinued operations, according to Note 5. The
balance of R$37,744 refers to the surplus value of Anish Empreendi-
mentos, a continuing operation.
(iv) See Note 5. The amount of R$8,034 included in the total referred
to above relates to goodwill allocated for the acquisition of Maringá
Armazéns Gerais Ltda. and Maringá Serviços Auxiliares de Transpor-
te Aéreo Ltda. These companies were acquired by Elog for R$28,178.
(v) See Note 7.
(vi) See Note 6.
ECORODOVIAS46
COST AMORTIZATION NET BOOK VALUE
AVERAGE AMORTIZATIO N
RATES (%)
BALANCES AT
12/31/2014
ADDITIONS (I)
WRITE-OFFS
TRANSF.ASSETS
HELD FOR SALE
IMPAIRM.ACQUIS.
ELOG (IV)
BALANCES AT
12/31/2015
BALANCES AT
12/31/2014 ADDITIONS
WRITE-OFFS
ASSETS HELD FOR
SALETRANSF.
ACQUIS.ELOG
(IV)
BALANCES AT
12/31/2015 12/31/2015 12/31/2014
Service concession arrangements
(ii) 5,618,523 512,525 (428) 20,037 - - 161,988 6,312,645 (1,562,746) (263,777) 28 (6,503) (965) (58,465) (1,892,428) 4,420,217 4,055,777
Goodwill Ecosul - 8,561 - - - - - - 8,561 (2,778) (512) - - - - (3,290) 5,271 5,783
Third-party software
13.7 79,752 11,537 (34) 5,539 830 - 39,770 137,394 (45,638) (12,451) - (2,609) - (23,561) (84,259) 53,135 34,114
Intangible assets in progress
- 26,331 4,696 - (8,614) - - - 22,413 - - - - - - - 22,413 26,331
Goodwill Elog (iii) - 236,133 - (236,133) - 5,175 (90,807) 549,344 463,712 (4,552) 129 4,755 - - - 332 464,044 231,581
Other - 603 - (330) - 129 - 1,002 1,404 (36) - - (32) - (17) (85) 1,319 567
5,969,903 528,758 (236,925) 16,962 6,134 (90,807) 752,104 6,946,129 (1,615,750) (276,611) 4,783 (9,144) (965) (82,043) (1,979,730) 4,966,399 4,354,153
COST AMORTIZATION NET BOOK VALUE
AVERAGE AMORTIZATION
RATES (%)
BALANCES AT
12/31/2015
ADDITIONS (I)
WRITE-OFFS
TRANSF. IMPAIRM. (v)ASSETS
HELD FOR SALE (vi)
BALANCES AT
12/31/2016
BALANCES AT
12/31/2015 ADDITIONS
WRITE-OFFS
TRANSF.ASSETS HELD FOR SALE (vi)
BALANCES AT
12/31/201612/31/2016 12/31/2015
Service concession arrangements
(ii) 6,312,645 219,037 (2,687) 64,400 (300,997) (204,758) 6,087,640 (1,892,428) (265,259) - 15 64,959 (2,092,713) 3,994,927 4,420,217
Goodwill Ecosul - 8,561 - - - - - 8,561 (3,290) (512) - - - (3,802) 4,759 5,271
Third-party software 13.6 137,394 11,041 (109) 2,040 - (40,599) 109,767 (84,259) (14,210) - (138) 26,170 (72,437) 37,330 53,135
Intangible assets in progress - 22,413 244,845 (429) (65,676) - - 201,153 - - - - - - 201,153 22,413
Goodwill Elog (iii) - 463,712 - - - - (425,968) 37,744 332 - - - (332) - 37,744 464,044
Other - 1,404 - - - - (1,002) 402 (85) - - - 50 (35) 367 1,319
6,946,129 474,923 (3,225) 764 (300,997) (672,327) 6,445,267 (1,979,730) (279,981) - (123) 90,847 (2,168,987) 4,276,280 4,966,399
SUSTAINABILITY REPORT 2016 47
FINANCIAL STATEMENTS
Accounting policyDeferred income and social contribution taxes (“deferred taxes”) are recognized on temporary differences at the end of each statement of financial position date between the recognized asset and liability balances in the financial statements and the corresponding tax bases used in the computation of taxable profit, including tax loss carryforwards, when applicable. Deferred tax liabilities are generally recognized on all taxable temporary differences, and deferred tax assets are recognized on all deductible temporary differences only when the Company is likely to recognize future taxable profit at an amount sufficient for such deductible temporary differences to be used. Deferred tax assets and liabilities are measured at the tax rate expected to be applied in the year in which the asset or liability will be realized or
settled, based on the tax rates (and tax law) in force as at the statement of financial position date.
a) Deferred taxes The recovery of deferred tax assets balance is
reviewed at the end of each reporting period and adjusted by the amount expected to be recovered.
Deferred income and social contribution taxes are recognized as expense or income in P&L for the year, unless they relate to items recorded in other comprehensive income, where applicable.
Deferred income and social contribution taxes were recorded using the effective rate of 34% (income and social contribution taxes), presented changes for the year, and are broken down as follows:
CONSOLIDATED STATEMENT OF FINANCIAL POSITION CONSOLIDATE D P&L
12/31/2015 ADDITIONSWRITE-
OFFS
ASSETS AND LIABILITIES
HELD FOR SALE (v)
IMPAIRM. (iv)
12/31/2016 12/31/2016
Goodwill realization on merger 327,358 - (44,875) (4,048) (63,011) 215,424 (107,886)
Provision for losses due to tax, labor and civil risks
48,344 7,572 (4,581) (7,279) - 44,056 2,991
Tax loss (i) 227,962 85,223 (6,903) (73,620) (180,999) 51,663 (102,679)
Provision for maintenance 84,025 16,711 (5,559) - - 95,177 11,152
Present value adjustment (PVA) burden – concession
3,467 289 (431) - - 3,325 (142)
Allowance for doubtful accounts 1,271 232 (463) (930) - 110 (231)
Exchange gains (losses) 7,922 4,175 (12,097) - - - (7,922)
Accrual for vacation pay – Executive Board
2,159 1,518 (211) (17) - 3,449 1,307
Investment surplus value – Elog 4,490 (22) 317 (4,785) - - 295
Effect of Law No. 12973/14 - Transition Tax Regime (RTT) ceased to exist (ii)
(55,112) - 3,341 - - (51,771) 3,341
Corporate depreciation (9,239) (487) 887 (969) - (9,808) 400
Capitalized interest (2,722) (1,957) 310 1,392 - (2,977) (1,647)
Provision for other losses 1,406 - - (1,406) - - -
Impairment 6,802 - - (6,802) - - -
Deferred income and social contribution taxes - assets/(liabilities) (iii)
648,133 113,254 (70,265) (98,464) (244,010) 348,648 (201,021)
(i) Refers to subsidiaries’ tax loss: EcoRodovias Concessões e Serviços,
Ecoporto Santos, Ecoporto Transporte, ECO101 Concessionária,
Ecopistas and Elog.
(ii) On September 17, 2013 and on November 12, 2013, the Brazilian
Internal Revenue Service (RFB) Revenue Procedure No. 1397 (IN
No. 1397) and the Provisional Executive Order No. 627 (MP No.
18. INCOME AND SOCIAL CONTRIBUTION TAXES
ECORODOVIAS48
627), respectively, were published, the latter of which: (i) repeals
the Transition Tax Regime (RTT) from 2015 onwards, introducing
a new tax regime; (ii) amends Decree Law No. 1598/77 regarding
the calculation of Corporate Income Tax (IRPJ) and legislation go-
verning the Social Contribution Tax on Net Profit (CSLL). The new
tax regime provided for in MP No. 627 will become effective from
2014 onwards, for companies that opt for its early adoption. Among
the provisions of MP No. 627, those that address the distribution
of profits and dividends, interest on equity calculation basis and
equity pickup calculation criterion during the effectiveness of the
Transition Tax Regime (RTT) are to be highlighted. On May 13, 2014,
Provisional Executive Order (MP) No. 627 was signed into Law No.
12973/14. Such Law did not substantially change the issues brought
by MP No. 627, and it is necessary to mention two matters that, in
our opinion, are the most important ones. (a) adjustment of tax laws
to the new accounting standards introduced by Law No. 11638/07
(end of the “RTT”, with consequent convergence of the Brazilian
accounting standards to the International Financial Reporting Stan-
dards (IFRS); b) introduction of new rules relating to taxation on
profits from foreign subsidiaries and affiliates.
The new legislation may be early adopted in 2014 and is mandatory
as from 2015. The Company decided to early adopt the new stan-
dards for 2014, since the adoption of these standards in 2015 could
affect the payment of exceeding dividends of 2014, one of the main
aspects introduced by Law No. 12973/14.
The effects recorded up to the year immediately preceding the
adoption (December 31, 2013) will be amortized over the term of the
Company’s concession, pursuant to Law No. 12973/14.
(iii) In compliance with CPC 32, item 73, the Company recorded
R$368,784 under noncurrent assets and R$20,136 under noncurrent
liabilities.
(iv) See Note 7.
(v) See Note 6.
Based on the projections prepared by Company management, the deferred income and social contribution taxes are expected to be realized in the following years:
CONSOLIDATED
12/31/2016 12/31/2015
2017 33,895 178,561
2018 33,093 82,625
2019 25,650 84,150
2020 25,650 88,858
From 2021 onwards 230,360 213,939
348,648 648,133
Management prepared a study on the future realization of deferred tax assets, taking into consideration the probable capacity to generate future taxable profit, in the context of the main business variables, which may, therefore, suffer changes.
Studies and projections conducted by the Company indicate that tax losses and goodwill on mergers of investees will be realized within 10 years. Company management believes that the assumptions utilized in the business plans are robust, feasible and in line with the current economic scenario.
SUSTAINABILITY REPORT 2016 49
FINANCIAL STATEMENTS
b) Reconciliation of income and social contribution tax income (expense)
The following current and deferred income and social contribution taxes were recognized in P&L for the years:
COMPANY CONSOLIDATED
12/31/2016 12/31/2015 12/31/2016 12/31/2015
Income (loss) for the year before income and social contribution taxes
(275,616) 152,717 220,112 318,673
Statutory rate 34% 34% 34% 34%
Income and social contribution taxes at combined rate 93,709 (51,924) (74,838) (108,349)
Adjustments to effective rate calculation:
Bonuses – chief officers (2,370) (5,733) (6,106) (9,636)
Equity pickup 56,737 92,391 (3) (293)
Nondeductible expenses (13) (42) (624) (655)
Goodwill amortization (7,474) - (15,258) (15,771)
Tax incentives (Workers’ Meal Program - PAT) - (9,004) 1,700 2,558
Tax credits not established by the tax authorities - Company (*)
(38,250) (35,404) (38,442) (35,679)
PPA adjustment – Elog - 9,672 - 9,672
Other 295 - (25) (1,049)
102,634 (44) (133,596) (159,202)
Derecognition of tax credit - Ecoporto (**) - - (244,010) -
Impairment Ecoporto (CPC 01) – not realized (102,339) - (102,339) -
Income and social contribution tax expenses 295 (44) (479,945) (159,202)
Current income and social contribution taxes - - (278,924) (215,415)
Deferred taxes 295 (44) (201,021) 56,213
(*) This refers to Company tax losses (Company) for which there is no expectation of realization in the next five years.
(**) See Note 7
c) Income and social contribution taxes paid
CONSOLIDATED
12/31/2016 12/31/2015
Opening balance of provision for income and social contribution taxes 15,911 37,160
Acquisition - Elog - 607
Assets and liabilities held for sale (588) -
IRPJ/CSLL expense – income statement 278,924 215,415
Total IRPJ/CSLL paid for the year (261,731) (237,271)
CLOSING BALANCE OF PROVISION FOR IRPJ/CSLL 32,516 15,911
(*) See Note 5
ECORODOVIAS50
19. TAXES, CHARGES AND CONTRIBUTIONS PAYABLE
COMPANY CONSOLIDATED 12/31/2016 12/31/2015 12/31/2016 12/31/2015
Taxes on revenue:
Service Tax (ISS) - - 12,233 12,187Contribution Tax on Gross Revenue for Social Security Financing (COFINS)
1,573 126 11,126 12,575
Contribution Tax on Gross Revenue for Social Integration Program (PIS)
340 21 2,313 2,315
Withholding ISS 1,087 729 9,436 8,934
Other taxes - 13 136 2,498
3,000 889 35,244 38,509
20. LOANS, FINANCING AND PROMISSORY NOTES
TYPE COMPANY FINAL MATURITY
AVERAGE INTEREST RATE CONSOLIDATED
12/31/2016 12/31/2015
In local currency:
Promissory notes (r) Ecocataratas 05/2017 CDI + 2.65% p.a 213,631 181,569
Promissory notes (q) Ecorodovias Concessões 11/2016 CDI + 2.50% p.a - 121,417
Finame (k) Ecosul 11/2020 6% p.a. 198 249
Finame (c) Ecocataratas 05/2017 TJLP + 3.21% 89 281
Finame (c) Ecocataratas 04/2017 TJLP + 2.70% 63 248
Finame (g) Ecocataratas 10/2022 2.5% p.a. 256 299
Finame (c) Ecocataratas 07/2018 3% p.a. 82 137
Finem (h) Ecocataratas 07/2018 TJLP + 2.1% p.a. 10,509 16,871
Finem (b) Ecopistas 07/2025 IPCA + 2.45% p.a. 33,497 41,432
Finem (b) Ecopistas 06/2025 TJLP+ 2.45% p.a. 148,819 173,214
Finame (f) Ecoporto Transportes 08/2016 TJLP + 4.16% p.a. - 672
Finame (f) Ecoporto Transportes 09/2016 TJLP + 4.16% p.a. - 314
Finame (f) Ecoporto Transportes 06/2017 7.7% p.a. 871 2,613
Finame (i) Termares 04/2020 6% p.a. 6,509 8,305
Finame (j) Ecocataratas 04/2020 6 % p.a. 694 896
Finem - BNDES (d) ECO101 04/2017 UMSELIC+4.87% p.a. 55,402 113,633
Finem - BNDES (d) ECO101 12/2028 TJLP + 3.84% p.a. 185,271 141,458
Finem - BNDES (d) ECO101 06/2030 TJLP+3.84% p.a. 66,020 60,649
Finame (m) Elog 12/2020 6% p.a - 479
Forklifts (n) Elog 02/2018 15.39% p.a. - 1,807
Forklifts (n) Ecopátio 04/2018 15.39% p.a. - 1,024
Financing (s) Eco101 12/2019 21.27% p.a 278 -
In foreign currency:
Finimp (f) Ecoporto Santos 09/2016 Libor 6M+4.6% p.a. - 565
Finimp (f) Ecoporto Santos 04/2016 Libor 6M+4.6% p.a. - 2,715
Finimp (f) Ecoporto Santos 05/2017 Libor 6M+5.2% p.a. 46 172
Finimp (l) Ecoporto Santos 01/2023 Libor 6M+2% p.a. 101,270 115,361
Finimp (o) Elog 06/2016 VC + 7.25% p.a. - 160
Finimp (p) Elog 01/2016 VC + 6.66% p.a. - 167
823,505 986,707
Current 339,302 494,835
Noncurrent 484,203 491,872
SUSTAINABILITY REPORT 2016 51
FINANCIAL STATEMENTS
The aging list of noncurrent installments is as follows:
12/31/2016 12/31/2015
2017 - 239,625
2018 66,199 55,616
2019 63,970 51,878
2020 64,555 51,259
2021 54,135 39,382
From 2021 onwards 235,344 54,112
484,203 491,872
Changes in loans, financing and promissory notes are as follows:
COMPANY CONSOLIDATED
12/31/2016 12/31/2015 12/31/2016 12/31/2015
Opening balance - 497,435 986,707 1,017,491
Assets and liabilities held for sale (**) - - (3,637) 844
Acquisition (*) - - - 19,972
Additions - - 256,407 432,182
Financial charges (see Note 33) - 37,192 83,894 156,437
Payment of principal - (475,000) (426,253) (537,359)
Payment of interest - (59,627) (73,613) (102,860)
CLOSING BALANCE - - 823,505 986,707
(*) See Note 5.
(**) See Note 6.
ECORODOVIAS52
Main bank loan and financing agreements in effect are as follows:
ITEM COMPANYFINANCIALINSTITUTION
REQUIRED FINANCIAL RATIOS
GUARANTEES
(a)EcoRodovias Infraestutura e Logística S.A.
BTG Pactual/ Banco ItaúBradesco/HSBC Corretor
Maintenance of ratios is not required. No guarantee.
(b) Ecopistas BNDES
(i) equity-to-total liabilities ratio shall be higher than 20%; (ii) the debt service insurance ratio shall be 1.20 or higher; and (iii) net debt-to-adjusted EBITDA ratio shall be lower than 4.00. The required financial ratios were complied with at December 31, 2016.
Assignment of credit rights of toll receivables as well as ancillary revenues arising from the concession, and any and all indemnities to be received under the terms of guarantees and insurance policies for loss of profit contracted under the service concession arrangement terms.
(c) EcocataratasBanco do Brasil/ Bradesco
Maintenance of ratios is not required. Disposal of the asset.
(d) ECO101 BNDES
(i) equity-to-total liabilities ratio shall be higher than 20%; (ii) net debt-to-adjusted EBITDA ratio shall be lower than 3%, based on EcoRodovias Infraestrutura consolidated information.
Guarantee - EcoRodovias Infraestrutura.
(e) Ecoporto Santos Unibanco Maintenance of ratios is not required. Chattel mortgage of shares.
(f)Ecoporto Santos/Ecoporto Transportes
Santander Maintenance of ratios is not required. No guarantee.
(g) Ecocataratas Banco Itaú Maintenance of ratios is not required. Disposal of the asset.
(h) Ecocataratas BNDES Maintenance of ratios is not required. Letter of guarantee.
(i) Ecoporto Santos Banco Itaú Maintenance of ratios is not required. Disposal of the asset.
(j) Ecocataratas Itaú Maintenance of ratios is not required. Disposal of the asset.
(k) Ecosul Itaú Maintenance of ratios is not required. No guarantee.
(l) Ecoporto SantosBanco Deutsche Bank AS
Equity (-) P&L for the year > 20,000 Equity/total assets > 20%
Guarantee - EcoRodovias Infraestrutura.
(m) Elog Itaú Maintenance of ratios is not required. No guarantee.
(n) Elog e Ecopátio NACCO Maintenance of ratios is not required. No guarantee.
(o)Elog Sul e Ecopátio
Nordea Bank Maintenance of ratios is not required. No guarantee.
(p) Elog Bradesco Maintenance of ratios is not required. No guarantee.
(q)Ecorodovias Concessões
Bradesco Maintenance of ratios is not required. No guarantees.
(r) Ecocataratas Bradesco Maintenance of ratios is not required. No guarantees
(s) Eco101Banco Volkswagem
Maintenance of ratios is not required. No guarantees
SUSTAINABILITY REPORT 2016 53
FINANCIAL STATEMENTS
The Company has a financial plan to settle short-term debts through raising of new debentures and use of own resources to pay amortization installments maturing in 2017. Management is confident that its financial plan will be implemented in 2017 and
(B) FINANCIAL RATIOS - ECOPISTAS – BNDES REQUIRED MEASURED (*)
(i) Equity/Total liabilities > 20% 35.8%
(ii) Debt coverage > 1.20 1.67
(iii) Net debt/adjusted EBTIDA < 4.00 3.57
(D) FINANCIAL RATIOS - ECO101 BNDES REQUIRED MEASURED (*)
(i) Net debt/EBTIDA ≥ 3 3.51 (***)
(i) Equity/Total liabilities > 20% 20.46
(L) FINANCIAL RATIOS - ECOPORTO REQUIRED MEASURED (*)
(i) Tangible equity > 20,000 36,735
(ii) Equity/total assets > 20% 9% (**)
ISSUERNOMINAL
VALUEISSUE
EXPENSESNET
AMOUNINTEREST RATE
P.A.IRR
Ecocataratas 180,000 (1,528) 178,472 100% CDI + 2.65% 16.84%p.a.
Financial ratios at December 31, 2016 are summarized as follows:
(*) Ratio not examined by independent auditors.
(**) Noncompliance with covenants is supported by Deutsche Bank’s waiver.
(***) Noncompliance with covenants is supported by waiver of BNDES until December 31, 2016.
understands that there will be no breach or default of the effective agreements.
The Internal Return Rate (IRR) of promissory notes is as follows:
21. DEBENTURES
Debentures are summarized as follows:
COMPANY CONSOLIDATED
12/31/2016 12/31/2015 12/31/2016 12/31/2015
Adjusted principal - 600,000 3,985,072 4,151,322
Yield (interest) - 18,636 159,396 190,216
Debentures issue cost (*) - (3,523) (37,840) (48,034)
- 615,113 4,106,628 4,293,504
Current - 17,583 680,535 822,090
Noncurrent - 597,530 3,426,093 3,471,414
ECORODOVIAS54
Changes in debentures are as follows:
COMPANY CONSOLIDATED
12/31/2016 12/31/2015 12/31/2016 12/31/2015
Opening balance 615,113 - 4,293,504 3,168,416
Acquisition of companies (*) - - - 323,745
Assets and liabilities held for sale (**) - - (345,768) 25,212
Addition - 595,746 214,739 635,474
Debt assignment (***) (625,782) - - -
Financial charges (see Note 33) 55,539 61,264 518,842 558,028
Payment of principal - - (189,148) (131,018)
Payment of interest (44,870) (41,897) (385,541) (286,353)
CLOSING BALANCE - 615,113 4,106,628 4,293,504
(*) See Note 5.
(**) As described in Note 6, the Company classified its logistics assets as Assets and liabilities held for sale. The amount of R$345,769 refers to the
debenture balance at January 1, 2016 of assets and liabilities held for sale.
(***) By virtue of the assignment, as from August 10, 2016, first-issue debenture holders of Ecorodovias Infraestrutura are now first-issue debenture
holders of Ecorodovias Concessões (due to the assignment and assumption of debt of Ecorodovias Infraestrutura).
On February 26, 2016, subsidiaries Ecovia and Ecosul executed an amendment to the indenture of issue of debentures. The following clauses were amended: a) Maturity: from 03/04/2016 to 05/15/2017; b) Remuneration from interest rate and restatement: from 105.7% of CDI to 115.0% of CDI; and c) inclusion of the financial indices described and calculated above.
SUSTAINABILITY REPORT 2016 55
FINANCIAL STATEMENTS
DESCRIPTIONCOMPANY (ASSIGNMENTOF DEBT ECORODOVIASCONCESSÕES)
ECORODOVIASCONCESSÕES ESERVIÇOS
ECOVIAS (2ND ISSUE)
ECOPORTO ECOVIA ECOSUL ECOPISTAS
Type andconvertibility
Nonconvertible and non-privileged debentures
Registered, book-entry, unsecured and nonconvertible
Registered, book-entry and nonconvertible
Registered, book-entry,without issue of certificateand nonconvertible
Registered, book-entry and nonconvertible
Registered, book-entry and nonconvertible
Registered, book-entryand nonconvertible
Number issued 60,000 (in two series) 80,000 (in three series) 881,000 (in two series) 600 (single series) 14,300 (single series) 14,800 (single series) 370,000 (in four series)
Unit par value on issue date
R$10,000R$10,000R$10,000
R$1,000 R$1,000 R$10,000 R$10,000 R$1,000
Issue date 04/15/201510/23/201211/18/2016
05/07/2013 06/19/2012 11/04/2014 11/17/2014 01/15/2011
Issue amount
R$600,000
R$800,0001st series - R$240,0002nd series - R$160,0003rd series - R$400,000Single series - R$215,000
R$881,0001st series - R$200,0002nd series - R$681,000
R$600,000 R$143,000 R$148,000
R$370,0001st series - R$92,5002nd series - R$92,5003rd series - R$92,5004th series - R$92,500
Unit par value atDecember 31,2016 (PU)
1st series - 10,2952nd series - 10,300
1st series - R$10,1752nd series - R$13,6293rd series - R$13,639Single series - R$10,000
1st series - R$1,3332nd series - R$1,337
R$ N/A N/A
1st series - R$1,4062nd series - R$1,2953rd series - R$1,2694th series - R$1,244
Unit par value restatement index
1st series - not adjustable1st series - not adjustable
1st series and single series - not adjustable2nd and 3rd series - Extended Consumer Price Index (IPCA)
1st and 2nd series - IPCA Not adjustable Not adjustable Not adjustable1st, 2nd, 3rd and 4th
series – IPCA
DESCRIPTIONCOMPANY (ASSIGNMENT OF DEBT ECORODOVIAS CONCESSÕES)
ECORODOVIAS CONCESSÕES ESERVIÇOS
ECOVIAS (2ND ISSUE)
ECOPORTO ECOVIA ECOSUL ECOPISTAS
Remuneration (interest and restatement)
1st series: CDI+1.18%p.a.2nd series: CDI+1.42%p.a.
1st series – 100% of CDI + 0.79 p.a.2nd series – 5.00% p.a.3rd series - 5.35% p.a.single series - 114% of CDI
1st series – 3.80% p.a. + IPCA2nd series – 4.28% p.a. + IPCA
CDI + 1.85% p.a. (252 days) on unit par value
115.0% of CDI 115.0% of CDI1st, 2nd and 3rd series – IPCA + 8.25% p.a.
Maturity of remuneration (interest and restatement)
1st series: 10/15/2016 to 04/15/20182nd series: 10/15/2016 to 04/15/2020
1st series: semiannual installments (04/15/2013 to 10/15/2018)2nd series: annual installments (10/15/2013 to 10/15/2019)3rd series: annual installments (10/15/2013 to 10/15/2022)Single series - (05/15/2017 to 02/19/2018)
1st series: annual installments (04/15/2013 to 04/15/2020)2nd series: annual installments (04/15/2014 to 04/15/2024)
Annual installments (06/15/2013 to 06/15/2017)
05/17/2017 05/17/2017
1st series: annually in 11 installments (01/15/2013 to 01/15/2023)2nd series: annually in 11 installments (04/15/2012 to 04/15/2022)3rd series: annually in 11 installments(07/15/2012 to 07/15/2022)4th series: annually in 11 installments (10/15/2012 to 10/15/2022)
Repayment maturity
1st series: 100% in 04/15/20182nd series: 50% 04/15/2019 and 50% 04/15/2020
1st series: semiannual installments (10/15/2016 to 10/15/2018)2nd series: annual installments (10/15/2018 to 10/15/2019)3rd series: annual installments (10/15/2020 to 10/15/2022)Single series – (02/19/2018)
1st series: annual installments (04/15/2019 to 04/15/2020)2nd series: annual installments (04/15/2022 to 04/15/2024)
Annual installments (06/15/2014 to 06/16/2019)
05/17/2017 05/17/2017
1st series: annually in 11 installments (01/15/2013 to 01/15/2023)2nd series: annually in 11 installments (04/15/2012 to 04/15/2022)3rd series: annually in 11 installments (07/15/2012 to 07/15/2022)4th series: annually in 11 installments (10/15/2012 to 10/15/2022)
ECORODOVIAS56
DESCRIPTIONCOMPANY (ASSIGNMENTOF DEBT ECORODOVIASCONCESSÕES)
ECORODOVIASCONCESSÕES ESERVIÇOS
ECOVIAS (2ND ISSUE)
ECOPORTO ECOVIA ECOSUL ECOPISTAS
Type andconvertibility
Nonconvertible and non-privileged debentures
Registered, book-entry, unsecured and nonconvertible
Registered, book-entry and nonconvertible
Registered, book-entry,without issue of certificateand nonconvertible
Registered, book-entry and nonconvertible
Registered, book-entry and nonconvertible
Registered, book-entryand nonconvertible
Number issued 60,000 (in two series) 80,000 (in three series) 881,000 (in two series) 600 (single series) 14,300 (single series) 14,800 (single series) 370,000 (in four series)
Unit par value on issue date
R$10,000R$10,000R$10,000
R$1,000 R$1,000 R$10,000 R$10,000 R$1,000
Issue date 04/15/201510/23/201211/18/2016
05/07/2013 06/19/2012 11/04/2014 11/17/2014 01/15/2011
Issue amount
R$600,000
R$800,0001st series - R$240,0002nd series - R$160,0003rd series - R$400,000Single series - R$215,000
R$881,0001st series - R$200,0002nd series - R$681,000
R$600,000 R$143,000 R$148,000
R$370,0001st series - R$92,5002nd series - R$92,5003rd series - R$92,5004th series - R$92,500
Unit par value atDecember 31,2016 (PU)
1st series - 10,2952nd series - 10,300
1st series - R$10,1752nd series - R$13,6293rd series - R$13,639Single series - R$10,000
1st series - R$1,3332nd series - R$1,337
R$ N/A N/A
1st series - R$1,4062nd series - R$1,2953rd series - R$1,2694th series - R$1,244
Unit par value restatement index
1st series - not adjustable1st series - not adjustable
1st series and single series - not adjustable2nd and 3rd series - Extended Consumer Price Index (IPCA)
1st and 2nd series - IPCA Not adjustable Not adjustable Not adjustable1st, 2nd, 3rd and 4th
series – IPCA
DESCRIPTIONCOMPANY (ASSIGNMENT OF DEBT ECORODOVIAS CONCESSÕES)
ECORODOVIAS CONCESSÕES ESERVIÇOS
ECOVIAS (2ND ISSUE)
ECOPORTO ECOVIA ECOSUL ECOPISTAS
Remuneration (interest and restatement)
1st series: CDI+1.18%p.a.2nd series: CDI+1.42%p.a.
1st series – 100% of CDI + 0.79 p.a.2nd series – 5.00% p.a.3rd series - 5.35% p.a.single series - 114% of CDI
1st series – 3.80% p.a. + IPCA2nd series – 4.28% p.a. + IPCA
CDI + 1.85% p.a. (252 days) on unit par value
115.0% of CDI 115.0% of CDI1st, 2nd and 3rd series – IPCA + 8.25% p.a.
Maturity of remuneration (interest and restatement)
1st series: 10/15/2016 to 04/15/20182nd series: 10/15/2016 to 04/15/2020
1st series: semiannual installments (04/15/2013 to 10/15/2018)2nd series: annual installments (10/15/2013 to 10/15/2019)3rd series: annual installments (10/15/2013 to 10/15/2022)Single series - (05/15/2017 to 02/19/2018)
1st series: annual installments (04/15/2013 to 04/15/2020)2nd series: annual installments (04/15/2014 to 04/15/2024)
Annual installments (06/15/2013 to 06/15/2017)
05/17/2017 05/17/2017
1st series: annually in 11 installments (01/15/2013 to 01/15/2023)2nd series: annually in 11 installments (04/15/2012 to 04/15/2022)3rd series: annually in 11 installments(07/15/2012 to 07/15/2022)4th series: annually in 11 installments (10/15/2012 to 10/15/2022)
Repayment maturity
1st series: 100% in 04/15/20182nd series: 50% 04/15/2019 and 50% 04/15/2020
1st series: semiannual installments (10/15/2016 to 10/15/2018)2nd series: annual installments (10/15/2018 to 10/15/2019)3rd series: annual installments (10/15/2020 to 10/15/2022)Single series – (02/19/2018)
1st series: annual installments (04/15/2019 to 04/15/2020)2nd series: annual installments (04/15/2022 to 04/15/2024)
Annual installments (06/15/2014 to 06/16/2019)
05/17/2017 05/17/2017
1st series: annually in 11 installments (01/15/2013 to 01/15/2023)2nd series: annually in 11 installments (04/15/2012 to 04/15/2022)3rd series: annually in 11 installments (07/15/2012 to 07/15/2022)4th series: annually in 11 installments (10/15/2012 to 10/15/2022)
SUSTAINABILITY REPORT 2016 57
FINANCIAL STATEMENTS
DESCRIPTIONCOMPANY (ASSIGNMENT OF DEBT ECORODOVIAS CONCESSÕES)
ECORODOVIASCONCESSÕES ESERVIÇOS
ECOVIAS (2ND ISSUE)
ECOPORTO ECOVIA ECOSUL ECOPISTAS
Reserve for repayment and remuneration (interest and restatement)
Not applicable Not applicable Not applicableNot applicable
Notapplicable
Notapplicable
a) For each TJLP- pegged sub-tranche granted by BNDES through the BNDES Agreement until maturity of the first amortization installment, the amount equivalent to three times the amount of the first installment of principal and debt charges; and after the payment of the first installment, the amount equivalent to three times the sum of the last past-due installment of the principal and debt charges (up to 15 days from the date of the last installment due).
b) For each IPCA- pegged sub-tranche granted by BNDES through the BNDES Agreement until maturity of the first amortization installment, the amount equivalent to 1/3 of the disbursem ent made, divided by the total number of the sub- loan installments; and after payment of the first installment of the principal and debt charges, the amount corresponding to 1/4 of the amount of the last past-due installment of the principal and debt charges (up to three months prior to the maturity of each installment).
DESCRIPTIONCOMPANY (ASSIGNMENT OF DEBT ECORODOVIAS CONCESSÕES)
ECORODOVIASCONCESSÕES ESERVIÇOS
ECOVIAS (2ND ISSUE)
ECOPORTO ECOVIA ECOSUL ECOPISTAS
Debenture depositary
Banco Bradesco S.A. Banco Bradesco S.A. Banco Bradesco S.A.Banco Bradesco BBI S.A.
Banco Bradesco S.A. Banco Bradesco S.A. Itaú Unibanco S.A.
Payment placeFinancial institution or company headquarters
CETIPCETIP and BMF&BOVESPA
CETIPCETIP and Banco Bradesco S.A.
CETIP and Banco Bradesco S.A.
CETIP and BOVESPAFIX
Reserve account bank
Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Itaú Unibanco S.A.
TrusteePentágono S.A. Distribuidora de Títulos e Valores Mobiliários
Oliveira Trust DTVM S.A. single series - Pentágono S.A.Distribuidora de Títulos e Valores Mobiliários
Pentágono S.A. Distribuidora de Títulos e Valores Mobiliários
Pentágono S.A. Distribuidora de Títulos e Valores Mobiliários
Oliveira Trust DTVM S.A.
Oliveira Trust DTVM S.A.
Planner Trustee DTVM Ltda.
Risk ratingBa3 (global scale) and A2.br (NSR) - Moody’s
brAA- (national scale) of Standard & Poor´s single series - there is no rating
brAA- (national scale) of Standard & Poor´s
Not applicable Not applicable Not applicableOf issuer: B1 (global scale) and Baa1.br (NSR) - Moody’s
GuaranteesFiança Ecorodovias Concessões E Serviços S.A.
Not applicable Not applicable
Statutory lien of100% of Ecoporto/Ecopor to Transporte - temporary surety from EcoRodovias Infraestrutura
There are no guarantee s of any nature
There are no guarantee s of any nature
Statutory lien of 100% of Ecopistas shares and of 100% of toll receivables
Restructuring clauses
No restructuring clauses No restructuring clauses No restructuring clauses No restructuring clausesNo restructuring clauses
No restructuring clauses
No restructuring clauses
ECORODOVIAS58
DESCRIPTIONCOMPANY (ASSIGNMENT OF DEBT ECORODOVIAS CONCESSÕES)
ECORODOVIASCONCESSÕES ESERVIÇOS
ECOVIAS (2ND ISSUE)
ECOPORTO ECOVIA ECOSUL ECOPISTAS
Reserve for repayment and remuneration (interest and restatement)
Not applicable Not applicable Not applicableNot applicable
Notapplicable
Notapplicable
a) For each TJLP- pegged sub-tranche granted by BNDES through the BNDES Agreement until maturity of the first amortization installment, the amount equivalent to three times the amount of the first installment of principal and debt charges; and after the payment of the first installment, the amount equivalent to three times the sum of the last past-due installment of the principal and debt charges (up to 15 days from the date of the last installment due).
b) For each IPCA- pegged sub-tranche granted by BNDES through the BNDES Agreement until maturity of the first amortization installment, the amount equivalent to 1/3 of the disbursem ent made, divided by the total number of the sub- loan installments; and after payment of the first installment of the principal and debt charges, the amount corresponding to 1/4 of the amount of the last past-due installment of the principal and debt charges (up to three months prior to the maturity of each installment).
DESCRIPTIONCOMPANY (ASSIGNMENT OF DEBT ECORODOVIAS CONCESSÕES)
ECORODOVIASCONCESSÕES ESERVIÇOS
ECOVIAS (2ND ISSUE)
ECOPORTO ECOVIA ECOSUL ECOPISTAS
Debenture depositary
Banco Bradesco S.A. Banco Bradesco S.A. Banco Bradesco S.A.Banco Bradesco BBI S.A.
Banco Bradesco S.A. Banco Bradesco S.A. Itaú Unibanco S.A.
Payment placeFinancial institution or company headquarters
CETIPCETIP and BMF&BOVESPA
CETIPCETIP and Banco Bradesco S.A.
CETIP and Banco Bradesco S.A.
CETIP and BOVESPAFIX
Reserve account bank
Not applicable Not applicable Not applicable Not applicable Not applicable Not applicable Itaú Unibanco S.A.
TrusteePentágono S.A. Distribuidora de Títulos e Valores Mobiliários
Oliveira Trust DTVM S.A. single series - Pentágono S.A.Distribuidora de Títulos e Valores Mobiliários
Pentágono S.A. Distribuidora de Títulos e Valores Mobiliários
Pentágono S.A. Distribuidora de Títulos e Valores Mobiliários
Oliveira Trust DTVM S.A.
Oliveira Trust DTVM S.A.
Planner Trustee DTVM Ltda.
Risk ratingBa3 (global scale) and A2.br (NSR) - Moody’s
brAA- (national scale) of Standard & Poor´s single series - there is no rating
brAA- (national scale) of Standard & Poor´s
Not applicable Not applicable Not applicableOf issuer: B1 (global scale) and Baa1.br (NSR) - Moody’s
GuaranteesFiança Ecorodovias Concessões E Serviços S.A.
Not applicable Not applicable
Statutory lien of100% of Ecoporto/Ecopor to Transporte - temporary surety from EcoRodovias Infraestrutura
There are no guarantee s of any nature
There are no guarantee s of any nature
Statutory lien of 100% of Ecopistas shares and of 100% of toll receivables
Restructuring clauses
No restructuring clauses No restructuring clauses No restructuring clauses No restructuring clausesNo restructuring clauses
No restructuring clauses
No restructuring clauses
SUSTAINABILITY REPORT 2016 59
FINANCIAL STATEMENTS
DESCRIPTION COMPANYECORODOVIASCONCESSÕES ESERVIÇOS
ECOVIAS (2ND ISSUE)
ECOPORTO ECOVIA ECOSUL ECOPISTAS
Required financial ratios
(i) Net debt / EBTIDA of subsidiary Ecorodovias Concessões e Serviços
Company’s financial ratios higher than or equal to 3.5% corresponding to consolidated net debt ratio on EBITDA and financial ratios higher than or equal to 2.0% in relation to EBITDA with net financial expense. Compliance with such ratios is checked quarterly based on the past 12 months.
Single series - Company’s financial ratios higher than or equal to 3.75% corresponding to consolidated net debt ratio on EBITDA and financial ratios higher than or equal to 2.0% in relation to EBITDA with net financial expense. Compliance with such ratios is checked quarterly based on the past 12 months.
Financial ratios at levels lower than 3.5% corresponding to net debt ratio on EBITDA and financial ratios higher than or equal to 2.0% in relation to EBITDA with net financial expense on the basis of the financial statements. Compliance with such ratios is checked quarterly based on the past 12 months.
Financial indices in which the net debt ratio on EBITDA for the past 12 months must be lower than: until 2015 4.5%, in2016 4.0%, in 2017 3.5%, andin 2018 3.0%. And the EBITDA for the past 12 months by net expenses must be lower than: until 2015 2.0%, in 2016 2.25%, in2017 2.50%, and in 2018 3.0 %. Ratios are recorded on a quarterly basis, based on the combined statement of financial position of Ecoporto Santos S.A. and Ecoporto Transportes Ltda.
There are no required financial ratios
There are no required financial ratios
The following financial ratios: (i) equity-to-total liabilities ratio shall be higher than 20%; (ii) the debt service insurance ratio shall be 1.20 or higher; and (iii) net debt-to- adjusted EBITDA ratio shall be lower than 4.00.
ECORODOVIAS CONCESSÕES REQUIRED MEASURED (*)
(i) Net debt / EBTIDA < 3.5 2.57
(ii) EBITDA/Financial expenses, net >2.0 3.87
(iii) Net debt / EBTIDA >3.75 2.40
(iv) Adjusted EBITDA/Financial expenses, net >2.0 4.15
ECOVIAS - 2ND ISSUE REQUIRED MEASURED (*)
(i) Net debt/EBTIDA < 3.5 1.32
(ii) Financial expense / EBITDA >2.0 4.78
ECOPISTAS REQUIRED MEASURED (*)
(i) Equity/Total liabilities > 20% 35.8%
(ii) Debt coverage > 1.20 1.69
(iii) Net debt/adjusted EBTIDA < 4.00 3.57
ECOPORTO REQUIRED MEASURED (*)
(i) Net debt/EBTIDA < 4.5 (12.86) (**)
(ii) EBITDA/financial expenses, net > 2.0 (0.67)(**)
ECORODOVIAS CONCESSÕES (ASSIGNMENT OF DEBT ECORODOVIAS INFRAESTRUTURA)
REQUIRED MEASURED (*)
(i) Net debt / EBTIDA of subsidiary Ecorodovias Concessões e Serviços < 3.75 2.57
(*) Ratios not reviewed by independent auditors.
(**) Supported by letter of guarantee.
Financial ratios at December 31, 2016 are summarized as follows:
ECORODOVIAS60
DESCRIPTION COMPANYECORODOVIASCONCESSÕES ESERVIÇOS
ECOVIAS (2ND ISSUE)
ECOPORTO ECOVIA ECOSUL ECOPISTAS
Required financial ratios
(i) Net debt / EBTIDA of subsidiary Ecorodovias Concessões e Serviços
Company’s financial ratios higher than or equal to 3.5% corresponding to consolidated net debt ratio on EBITDA and financial ratios higher than or equal to 2.0% in relation to EBITDA with net financial expense. Compliance with such ratios is checked quarterly based on the past 12 months.
Single series - Company’s financial ratios higher than or equal to 3.75% corresponding to consolidated net debt ratio on EBITDA and financial ratios higher than or equal to 2.0% in relation to EBITDA with net financial expense. Compliance with such ratios is checked quarterly based on the past 12 months.
Financial ratios at levels lower than 3.5% corresponding to net debt ratio on EBITDA and financial ratios higher than or equal to 2.0% in relation to EBITDA with net financial expense on the basis of the financial statements. Compliance with such ratios is checked quarterly based on the past 12 months.
Financial indices in which the net debt ratio on EBITDA for the past 12 months must be lower than: until 2015 4.5%, in2016 4.0%, in 2017 3.5%, andin 2018 3.0%. And the EBITDA for the past 12 months by net expenses must be lower than: until 2015 2.0%, in 2016 2.25%, in2017 2.50%, and in 2018 3.0 %. Ratios are recorded on a quarterly basis, based on the combined statement of financial position of Ecoporto Santos S.A. and Ecoporto Transportes Ltda.
There are no required financial ratios
There are no required financial ratios
The following financial ratios: (i) equity-to-total liabilities ratio shall be higher than 20%; (ii) the debt service insurance ratio shall be 1.20 or higher; and (iii) net debt-to- adjusted EBITDA ratio shall be lower than 4.00.
The aging list of noncurrent installments is as follows:
COMPANY
12/31/2015
INSTALLMENT COST TOTAL
2017 - (1,100) (1,100)
2018 232,000 (771) 231,229
2019 184,000 (491) 183,509
2020 184,000 (108) 183,892
600,000 (2,470) 597,530
CONSOLIDATED
12/31/2016 12/31/2015
INSTALLMENT COST TOTAL INSTALLMENT COST TOTAL
2017 - - - 49,980 (261) 49,719
2018 808,151 (8,570) 799,581 287,112 (9,515) 277,597
2019 611,639 (6,223) 605,416 633,267 (8,640) 624,627
2020 582,307 (4,981) 577,326 617,914 (6,231) 611,683
2021 295,019 (4,416) 290,603 557,921 (4,981) 552,940
2022 - 2024 1,157,367 (4,200) 1,153,167 1,363,462 (8,614) 1,354,848
3,454,483 (28,390) 3,426,093 3,509,656 (38,242) 3,471,414
SUSTAINABILITY REPORT 2016 61
FINANCIAL STATEMENTS
The Internal Return Rate (IRR) of transactions is as follows:
ISSUER SERIES DATE NOMINAL VALUE ISSUE EXPENSES NET AMOUNT INTEREST RATE IRR
EcoRodovias Concessões e Serviços
Debentures - 1st seriesDebentures – 2nd seriesDebentures – 3rd seriesDebentures - 1st seriesDebentures – 2nd seriesDebentures - single series
23/10/201223/10/201223/10/201215/05/201524/05/2015
18/11/2016
240,000160,000
400,000232,000368,000215,000
(6,196)(4,156)
(10,502)(1,571)
(2,492)(226)
233,804155,844389,498230,429365,508214,774
CDI + 0.79%5.00%+ IPCA5.35%+ IPCA
CDI + 1.18% p.a.CDI+1.42%p.a.
114% do CDI
12.10%12.66%12.95%15.06%15.29%15.47%
Ecovias dos ImigrantesDebentures - 1st seriesDebentures – 2nd series
15/04/201315/04/2013
200,000681,000
(6,892)(23,469)
193,108657,531
IPCA + 3.80% p.a.IPCA + 4.28% p.a.
11.32%11.74%
Ecopistas
Debentures - 1st seriesDebentures – 2nd seriesDebentures – 3rd seriesDebentures – 4th series
15/01/201115/01/201115/01/201115/01/2011
92,50092,50092,50092,500
(3,167)(3,167)(3,167)(3,167)
89,33389,33389,33389,333
IPCA + 8.25%IPCA + 8.25%IPCA + 8.25%IPCA + 8.25%
15.69%15.73%15.71%
15.66%
Ecoporto Santos Single series 15/06/2012 600,000 (4,267) 595,733 CDI + 1.85% p.a. 12.72%
Ecosul Single series 17/11/2014 148,000 (228) 147,772 115% CDI 14.84%
Ecovia Single series 04/11/2014 143,000 (233) 142,767 115% CDI 14.8%
3,757,000 (72,900) 3,684,100
22. FINANCE LEASEThe lease obligations are guaranteed effectively, since the leased asset is reversed to lessor in the event of default.
The financial obligations are broken down as follows:
12/31/2016
Gross finance lease obligations – minimum lease payments: 97
Within 1 year 28
125
Future financing charges on finance lease 2
Finance lease obligations - book balance 125
Current 99
Noncurrent 28
12/31/2016
Addition 185
Financial charges (see Note 33) 29
Payment of principal (60)
Payment of interest (27)
Closing balance 127
Changes in this information are as follows:
ECORODOVIAS62
ISSUER SERIES DATE NOMINAL VALUE ISSUE EXPENSES NET AMOUNT INTEREST RATE IRR
EcoRodovias Concessões e Serviços
Debentures - 1st seriesDebentures – 2nd seriesDebentures – 3rd seriesDebentures - 1st seriesDebentures – 2nd seriesDebentures - single series
23/10/201223/10/201223/10/201215/05/201524/05/2015
18/11/2016
240,000160,000
400,000232,000368,000215,000
(6,196)(4,156)
(10,502)(1,571)
(2,492)(226)
233,804155,844389,498230,429365,508214,774
CDI + 0.79%5.00%+ IPCA5.35%+ IPCA
CDI + 1.18% p.a.CDI+1.42%p.a.
114% do CDI
12.10%12.66%12.95%15.06%15.29%15.47%
Ecovias dos ImigrantesDebentures - 1st seriesDebentures – 2nd series
15/04/201315/04/2013
200,000681,000
(6,892)(23,469)
193,108657,531
IPCA + 3.80% p.a.IPCA + 4.28% p.a.
11.32%11.74%
Ecopistas
Debentures - 1st seriesDebentures – 2nd seriesDebentures – 3rd seriesDebentures – 4th series
15/01/201115/01/201115/01/201115/01/2011
92,50092,50092,50092,500
(3,167)(3,167)(3,167)(3,167)
89,33389,33389,33389,333
IPCA + 8.25%IPCA + 8.25%IPCA + 8.25%IPCA + 8.25%
15.69%15.73%15.71%
15.66%
Ecoporto Santos Single series 15/06/2012 600,000 (4,267) 595,733 CDI + 1.85% p.a. 12.72%
Ecosul Single series 17/11/2014 148,000 (228) 147,772 115% CDI 14.84%
Ecovia Single series 04/11/2014 143,000 (233) 142,767 115% CDI 14.8%
3,757,000 (72,900) 3,684,100
SUSTAINABILITY REPORT 2016 63
FINANCIAL STATEMENTS
23. RELATED PARTIESThe Company and its subsidiaries contract services from their shareholders or from related companies, both directly or through consortiums, for the performance of upkeep, improvement and expansion services in the highway system and administrative and financial services.
According to the Company’s articles of incorporation, the Board of Directors is responsible for approving contracts between the Company and any shareholder of Company or parent company of its shareholders,
or companies that are subsidiaries or affiliates of the Company shareholders or of their controlling shareholders, and any member of the Board of Directors may request, previously and timely, the preparation of an independent assessment conducted by a specialized company that will review the terms and conditions of the proposed contract and analyze its adequacy to market conditions and practices (arm’s length basis).
The balances of related-party transactions at December 31, 2016 and 2015 are as follows:
NATURE COMPANY CONSOLIDATED
12/31/2016 12/31/2015 12/31/2016 12/31/2015
Current assets
Elog S.A.(e) Subsidiary - 7 - -
Ecoporto Santos S.A. (j) Subsidiary 30,564 - - -
Ecoporto Transporte Ltda. (j) Subsidiary 4,047 - - -
Ecorodovias Concessões e Serviços S.A. (e) Subsidiary 4,144 175 - -
Ecorodovias Concessões e Serviços S.A. (l) Subsidiary - - - -
Ecorodovias Concessões e Serviços S.A. (p) Subsidiary - - - -
Empresa Concessionária de Rodovias do Sul S.A. - Ecosul (a)
Subsidiary 50 45 - -
38,805 227 - -
Changes in intangible assets:
CBB Indústria e Comércio de Asfaltos e Engenharia Ltda. (d)
Other related parties
- - 57,711 31,892
Consórcio Carvalho Pinto (k)Other related parties
- - 4,468 38,443
TB Transportadora Betumes Ltda. (d)Other related parties
- - 6,444 4,571
Contek Engenharia S.A. (f)Other related parties
- - 7,293 -
Incospal Construções Pré-fabricadas Ltda. (i)Other related parties
- - 1,568 1,545
SBS Engenharia e Construções S.A. (b)Other related parties
- - 28,738 10,420
CR Almeida S.A. Engenharia de obras (c)Other related parties
- - 58,162 -
Engenharia e Constr. Araribóia Ltda. (o)Other related parties
- - 6,773 -
Consórcio Serra do Mar (c)Other related parties
- - - 42,134
- - 171,157 129,005
Noncurrent assets
Ecoporto Santos S.A. (j) Subsidiary - 27,324 - -
Ecoporto Transportes Ltda. (n) Subsidiary - 3,618 - -
- 30,942 - -
TOTAL ASSETS 38,805 31,169 171,157 129,005
ECORODOVIAS64
NATURE COMPANY CONSOLIDATED
12/31/2016 12/31/2015 12/31/2016 12/31/2015
Current liabilities:
SBS Engenharia e Construções S.A. (b)Other related parties
- - 134 1,406
Elog S.A. (m) Subsidiary - 89 - -
EcoRodovias Concessões e Serviços S.A. (l) Subsidiary 19,594 - - -
Contek Engenharia S.A. (f)Other related parties
- - 688 -
EcoRodovias Concessões e Serviços S.A. (p) Controlada 62,846 - - -
CR Almeida S.A. Engenharia de obras (c)Other related parties
- - 3,529 2,803
Incospal Construções Pré-fabricadas Ltda. (i)Other related parties
- - 156 77
Engenharia e Constr. Araribóia (o)Other related parties
- - 484 483
TB Transportadora Betumes Ltda. (d)Other related parties
- - 66 325
Unimar Transportes Ltda. (g)Other related parties
- - 438 404
Vix Logística S.A. (h)Other related parties
- - 473 446
CBB Indústria e Comércio de Asfaltos e Engenharia Ltda. (d)
Other related parties
- - 779 3,241
TOTAL CURRENT LIABILITIES 82,440 89 6,747 9,185
NATURE COMPANY CONSOLIDATED
12/31/2016 12/31/2015 12/31/2016 12/31/2015
Noncurrent liabilities:
Ecorodovias Concessões e Serviços S.A. (l) Subsidiary 293,176 263,074 - -
Ecorodovias Concessões e Serviços S.A. (q) Subsidiary 598,178 - - -
Total noncurrent liabilities: 891,354 263,074 - -
TOTAL LIABILITIES 973,794 263,163 6,747 9,185
SUSTAINABILITY REPORT 2016 65
FINANCIAL STATEMENTS
Related-party transactions break down as follows:
(a) Refers to the rental of the real estate where the head office of
Ecosul is located. Balance matures within 30 days.
(b) SBS Engenharia e Construções Ltda. holds a 10% interest in
subsidiary Ecosul and provides paving and engineering services in
the highway system of Ecosul. The overall price agreed to deliver
the services contracted between Ecosul and SBS Engenharia e
Construções Ltda. is R$41,139. The term for completion of these
services expires in March 2018. At December 31, 2016, there is a
balance of services to be rendered amounting to R$6,273. The
outstanding balance payable of de R$134 (on services already
rendered) falls due within 45 days and is not subject to financial
charges, and no collaterals were pledged to creditors.
(c) Consórcio Serra do Mar, comprised of the Company’s related parties
(CR Almeida Engenharia de Obras S.A., Cigla Construtor Impregilo
Associados S.A.), and Impregilo SPA, provide construction services
in operating lanes, emergency areas, the third lane crossover for
the Padre Manoel da Nóbrega highway, construction of bypasses in
the Cônego Domenico Rangoni highway, paving of the Anchieta-
Imigrantes system highways, and at the toll plazas of indirect
subsidiary, Ecovias. The overall price agreed by and between Ecovias
and Consórcio Serra do Mar to deliver the services contracted totals
R$54,088 including the contractual addendum. The agreement
expired on January 31, 2017, and there is an unrealized balance of
R$1,131. At December 31, 2016, there is no outstanding balance.
(d) CBB Indústria e Comércio de Asfaltos e Engenharia Ltda. and TB
Transportadora de Betumes Ltda., which comprises the indirect
shareholders of the related party C.R. Almeida Engenharia e
Obras S.A., the parent company of the Company, provide asphalt
material supply and transportation services to: Concessionária
Ecovia Caminho do Mar S.A. Concessionária das Rodovias Ayrton
Senna e Carvalho Pinto S.A. - Ecopistas, Rodovias das Cataratas
S.A. - Ecocataratas, ECO101 Concessionária de Rodovias S.A,
Concessionária Ecovias dos Imigrantes S.A. and Concesionária de
Rodovias do Sul - Ecosul. The overall price agreed to deliver the
services contracted between the Company, CBB Indústria e Comércio
de Asfaltos e Engenharia Ltda. and TB Transportadora de Betumes
Ltda. is R$331,255, including the contractual addendum. The term for
completion of these services expires in December 2016. At December
31, 2016, there was a balance of R$180,142 in services to be incurred.
The outstanding balance payable of R$779 (on services already
delivered) falls due within 45 days and is not subject to financial
charges, and no collateral was pledged to the creditors.
(e) The balance refers to transfers of employees between companies
(accrued vacation pay and 13th salary).
(f) Contek Engenharia S.A. is the related party of Centaurus
Participações, which holds 27.5% of Eco101 Concessionária de
Rodovias S.A.’s equity interest. The purpose of the agreement
between Contek and Eco101 is machining, which was fully
performed and there is a balance payable of R$688.
(g) Unimar Transportes Ltda. is the related party of Centaurus
Participações, which holds 27.5% of Eco101 Concessionária de
Rodovia S.A.’s equity interest. The subject matter of the agreement
between Unimar and Eco101 is vehicle mechanical rescue and support
for the roadway system administered by the concessionaire and
the lease of vehicles for this service. The total agreement amount
is R$23,749 and is effective up to November 2018. At December 31,
2016, R$16,253 had been incurred. At December 31, 2016, there was
an outstanding balance of R$438 falling due within 45 days.
NATURE COMPANY CONSOLIDATED
12/31/2016 12/31/2015 12/31/2016 12/31/2015
P&L:
Revenue:
Empresa Concessionária de Rodovias do Sul S.A. - Ecosul (a)
Subsidiary 575 528 - -
Ecoporto Santos S.A. (j) Subsidiary 3,812 12,511 - -
Ecoporto Transportes Ltda. (n) Subsidiary 332 60 - -
4,719 13,099 - -
Expenses/cost:
Unimar Transportes Ltda. (g)Other related parties
- - 5,713 -
Vix Logística S.A. (h)Other related parties
- - 6,183 -
SBS Engenharia e Construções S.A. (b)Other related parties
- - 575 76
Ecorodovias Concessões e Serviços S.A. (q) Subsidiary 35,242 - - 2,130
Ecorodovias Concessões e Serviços S.A. (l) Subsidiary 35,756 - - 5,731
70,998 - 12,471 7,937
ECORODOVIAS66
(h) Vix Logística S.A. is the related party of Centaurus Participações,
which holds 27.5% of Eco101 Concessionária de Rodovia S.A.’s equity
interest. The subject matter of the agreement between Unimar and
Eco101 is vehicle mechanical rescue and support for the roadway
system administered by the concessionaire and the lease of vehicles
for this service. The total agreement amount is R$25,461 and is
effective up to November 2018. At December 31, 2016, R$17,646 had
been incurred and there is an outstanding balance of R$473 falling
due within 45 days.
(i) Incospal Construções Pré-fabricadas S.A. is the related party of
Centaurus Participações, which holds 27.5% of Eco101 Concessionária
de Rodovias S.A.’s equity interest. The subject matter of the
agreement between Incospal and Eco101 is the provision of services
in connection with supply and implementation, transportation and
assembly of prefabricated parts for toll plazas along the BR-101/
ES highway. The overall price for the performance of contracted
services is R$ 3,195. The term for the performance of these services
is up to July 2016, and R$3,112, was incurred up to December 31, 2016.
Outstanding balances for services already performed amounted to
R$156 falling sue within 45 days, which are not subject to financial
charges, and no collateral was pledged to creditors.
(j) This refers to a loan agreement with subsidiary Ecoporto Santos
S.A. as borrower. The loan shall be restated at the fixed interest rate
of 13.64% maturing until June 12, 2018.
(k) Consórcio Carvalho Pinto, comprised of related parties CR
Almeida S.A. Engenharia de Obras, Salini Impregilo S.p.A.
Sucursal Brasil and CIGLA - Construtora Impregilo e Associados
S.A., contracted for the performance of construction works at
Lot 1 - extension of Carvalho Pinto highway. The total contractual
amount is R$51,719. The term for the performance of services
expires in December 2016. At December 31, 2016, the amount of
R$51,269 had already been incurred and there are no outstanding
balances payable.
(l) This refers to a loan agreement with the direct subsidiary
Ecorodovias Concessões e Serviços S.A. as lender. The loan shall be
restated at 13.64% p.a.
(m) These refer to storage and manufacturing expenses for Christmas
gifts by the subsidiary Elog S.A.
(n) This refers to a loan agreement with Ecoporto Transporte Ltda.
as borrower. The loan shall be restated at the fixed interest rate of
13.64% p.a. maturing until October 29, 2017.
(o) Engenharia e Construtora Araribóia Ltda. is the related party
of Centaurus Participações, which holds 27.5% of Eco101
Concessionária de Rodovias S.A.’s equity interest. The subject
matter of the agreement between Araribóia and Eco101 is the
provision of local repair services for pavement recovery of BR-101
in the stretch under the Concessionaire’s management. The term
for completion of these services expires on December 31, 2016. The
total contractual amount is R$12,628, and R$12,343 was incurred up
to December 31, 2016. Outstanding balances payable in the amount
of R$484 fall due within 45 days and are not subject to financial
charges and no collateral was pledged to creditors.
(p) On August 10, 2016, the Company entered into an agreement for
Assignment and assumption of obligations and other covenants
with Ecorodovias Concessões e Serviços S.A., which will be adjusted
under the same terms provided for in the indenture, through which
it assigned the debt amounting to R$600,000 in debentures in two
series: - 1st series CDI+1.18%p.a. maturing on 04/15/2018 and – 2nd
series CDI 1.42%p.a. maturing on 04/15/2020.
Balances of intercompany loan agreements between subsidiaries at December 31, 2016 and 2015 are not sta-ted in the financial statements as these do not include the parent company and are eliminated in the consoli-dated financial statements. The balances are as follows:
LENDER BORROWER 12/31/2016 12/31/2015 MATURITY RATE
EcoRodovias Concessões Ecopistas 122,037 108,065 31/03/2018 100% CDI + 1.20%p.a.
Termares Ecoporto Santos 9,217 8,61 Not determined 1% p.a.
131,254 108,065
Other intercompany agreementsEcoRodovias Concessões e Serviços S.A., a direct subsidiary of EcoRodovias Infraestrutura, provides ad-ministrative, financial, human resources, information technology, and engineering and corporate procurement services for other companies of the EcoRodovias Group. The annual amount of the agreements entered into bet-ween the service companies is R$207,336, effective for 12 months from January to December of each year.
Key management personnel compensationManagement members are the persons with authority and responsibility for the plan, management and con-trol of the Company’s activities.
For the year ended December 31, 2016, management received short-term benefits (salaries, profit sharing, private pension plan and stock option plan) accounted for in “General and administrative expenses”.
SUSTAINABILITY REPORT 2016 67
FINANCIAL STATEMENTS
24. PROVISION FOR MAINTENANCE - CONSOLIDATEDThe amounts recorded as provision for maintenance refer to the estimated future expenses to upkeep of the highway infrastructure at a level of operational readiness, as provided for in contract, adjusted to present value based on rates from 11.52% to 16.28% p.a., on average, corresponding to average rates for taking out loans. The amounts are accrued by highway stretch, and interventions occur, on average, every four years, as follows:
No amounts were paid in the period relating to: (a) post-employment benefits (pension, other retirement benefits, post-employment life insurance and post-employment health care plan); (b) long-term benefits (for length of service and long-term disability benefits); and (c) severance benefits;
At the Annual General Meeting, management’s annual overall compensation for the year ending December 31, 2016, was set at R$28,486
(R$22,738 for 2015) and part of the proposed amount for the remuneration of certain managers may be apportioned between the Company and its subsidiaries in accordance with a cost sharing agreement. For the year ended December 31, 2016, the amount apportioned with subsidiary Ecorodovias Concessões e Serviços was R$8,834.
Compensation paid to management for the year is as follows:
12/31/2016 12/31/2015
(Fixed/ variable) compensation 6,637 5,906
Bonuses 8,345 -
Stock option plan (see Note 30.f) 1,671 2,936
Incentive plan for retaining Executive Board officers 624 6,584
Share-based compensation (Phantom Stock Option/Restricted Stock) 1,255 319
Private pension plan 347 452
18,879 16,197
12/31/2014ADDITION
(COST)PAYMENT
FINANCIAL EFFECT
12/31/2015ADDITION
(COST)PAYMENT
FINANCIAL EFFECT
12/31/2016
Setup of provision for maintenance 746,542 123,282 - - 869,824 132,287 - - 1,002,111
Present value effect on provision (151,821) (31,394) - - (183,215) (27,558) - - (210,773)
Performance of maintenance (464,383) - (98,060) - (562,443) - (100,072) - (662,515)
Present value adjustment – realizations 89,486 - - 21,791 111,277 - - 27,972 139,249
219,824 91,888 (98,060) 21,791 235,443 104,729 (100,072) 27,972 268,072
Current 66,827 - - - 55,869 87,531
Noncurrent 152,997 - - - 179,574 180,541
ECORODOVIAS68
12/31/2014ADDITION
(COST)PAYMENT
FINANCIAL EFFECT
12/31/2015ADDITION
(COST)PAYMENT
FINANCIAL EFFECT
12/31/2016
Setup of provision for maintenance 746,542 123,282 - - 869,824 132,287 - - 1,002,111
Present value effect on provision (151,821) (31,394) - - (183,215) (27,558) - - (210,773)
Performance of maintenance (464,383) - (98,060) - (562,443) - (100,072) - (662,515)
Present value adjustment – realizations 89,486 - - 21,791 111,277 - - 27,972 139,249
219,824 91,888 (98,060) 21,791 235,443 104,729 (100,072) 27,972 268,072
Current 66,827 - - - 55,869 87,531
Noncurrent 152,997 - - - 179,574 180,541
SUSTAINABILITY REPORT 2016 69
FINANCIAL STATEMENTS
25. 25PROVISION FOR FUTURE CONSTRUCTION - CONSOLIDATEDThe provision for future construction works matched against intangible assets arises from the amounts to be disbursed to comply with the contractual concession obligations, whose economic benefits have already been recognized by the Company matched against intangible assets. The amounts are adjusted to present value at ra-tes from 11.52% to 25.64% p.a., on average, corresponding to weighted average rates for taking out loans.
This provision is in accordance with the guidance from the Brazilian FASB - (CPC) - OCPC- 05, items 31 to 33, which address construction services not representing potential generation of additional revenue, by which the Company must estimate the amounts referring to these construction works and recognize its liabilities matched against intangible assets at inception of contractual terms. Changes and balances of provisions are as follows:
12/31/2014 ADDITION (*) PAYMENTFINANCIAL
EFFEC12/31/2015 ADDITION PAYMENT
FINANCIAL EFFEC
12/31/2015
Set up of provision for future construction works 21,079 96,896 - - 117,975 - - - 117,975
Present value effect on provision (10,011) (11,316) - - (21,327) - - - (21,327)
Performance of construction (9,577) - (1,150) - (10,727) - (25,140) - (35,867)
Present value adjustment – realizations 8,778 - - 169 8,947 - - 2,164 11,111
10,269 85,580 (1,150) 169 94,868 - (25,140) 2,164 71,892
Current 7,832 43,227 38,124
Noncurrent 2,437 51,641 33,768
(*) The amount of R$85,580 added for the year ended December 31, 2015 relates to future works of Concessionária Ponte Rio-Niterói S.A. - Ecopon-
te acquired in April 2015, through a bidding process with the Brazilian Ground Transportation Authority (ANTT).
26. CONCESSION RIGHTS PAYABLE
I) Fixed and variable fees
12/31/2016 12/31/2015
Installments:
Fixed - Ecovias (a) 26,249 39,378
Variable - Ecosul (e) 196 139
Variable - Ecovias (b) 1,448 1,384
Variable - Ecopistas (b) 380 360
Inspection fee - Eco101 (i) 496 454
Inspection fee - Ecoponte (h) 258 236
Other – Ecovia – Inspection fee (c) 248 238
Other – Ecovia – Highway Patrol fee (d) 355 639
Other – Ecocataratas – Inspection fee (f) 294 279
Other - Ecocataratas - PRE/PRF (k) 1,522 -
Other – Ports - Charges CODESP (j) 995 383
32,441 43,490
Current 25,014 21,369
Noncurrent 7,427 22,121
(a) The highway service concession arrangement of subsidiary Ecovias dos Imigrantes, dated May 27, 1998, subdivides fixed fees into 240 fixed con-
secutive monthly installments, maturing from the first month of collection, adjustable annually based on IGP-M variation disclosed by Fundação
Getulio Vargas (FGV). At December 31, 2016, 16 installments remain unpaid and payments made correspond to 93.33% of total amount (88.33%
at December 31, 2015).
ECORODOVIAS70
12/31/2014 ADDITION (*) PAYMENTFINANCIAL
EFFEC12/31/2015 ADDITION PAYMENT
FINANCIAL EFFEC
12/31/2015
Set up of provision for future construction works 21,079 96,896 - - 117,975 - - - 117,975
Present value effect on provision (10,011) (11,316) - - (21,327) - - - (21,327)
Performance of construction (9,577) - (1,150) - (10,727) - (25,140) - (35,867)
Present value adjustment – realizations 8,778 - - 169 8,947 - - 2,164 11,111
10,269 85,580 (1,150) 169 94,868 - (25,140) 2,164 71,892
Current 7,832 43,227 38,124
Noncurrent 2,437 51,641 33,768
(b) In Ecovias and Ecopistas the variable installment is calculated and
paid monthly at 1.5% of revenue collection.
(c) Payment of an annual inspection fee in monthly installments
during the term of the agreement, which is R$60 per month
from the beginning to the 11th year and R$66 per month from the
12th year to the end of the agreement. At December 31, 2016, the
monthly restated amount is R$248 (R$238 at December 31, 2015).
(d) Payment of a fee to equip the Highway Patrol of subsidiary Ecovia.
(e) The variable installment is calculated and paid monthly at 1% of the
revenue from toll collection.
(f) Payment of an annual inspection fee in 12 monthly installments
of R$77 during the term of the arrangement, adjusted
proportionally to the adjustment ratios to the toll fees. At
December 31, 2016, the adjusted installment is R$294 (R$279 at
December 31, 2015).
(g) Subsidiaries Ecovia and Ecocataratas charge a monthly inspection
fee from the Regulatory Agency of the State of Paraná (AGEPAR
– Agência Reguladora do Paraná), at an amount corresponding to
0.5% of toll collection revenue.
(h) According to the arrangement entered into on May18, 2015, the
amount of R$210 shall be paid as inspection fees up to the end of
the concession period under the same terms and ratios as the high-
way toll. At December 31, 2016, the restated amount is R$258.
(i) The annual amount of inspection fee of Eco 101 shall be R$3,722 di-
vided into 12 installments to be paid to ANTT up to the 5th business
day of the month subsequent to that due and payable. This amount
will be adjusted on an annual basis, on the same date and percenta-
ges of toll price adjustments.
(j) These refer to payments of fees to Companhia de Docas do Estado
de São Paulo – CODESP of subsidiaries Ecoporto Santos and Terma-
res, as releases and handling of containers, berth zone infrastructure
and declaration of customs transit.
(k) Payment of a fee to equip the Highway Patrol. This fee is intended
to acquire equipment used by the Highway Patrol.
SUSTAINABILITY REPORT 2016 71
FINANCIAL STATEMENTS
Indirect subsidiaries Ecovias dos Imigrantes and Ecopistas have insurance coverage against risks incidental to the development of all activities involved in the concession. The insurance coverage shall be effective until the agreement for the definitive return of the highway system is executed.
The aging list of noncurrent installments is as follows:
Concessionária Ecovias dos Imigrantes S.A.The concession operator has assumed the commitment arising from widening of Imigrantes Highway between km 41.0 and km 58.0 (downward lane), initially estimated to be completed in the first half of 2003. This commitment was fulfilled in advance on December 17, 2002, upon delivery of the construction project.
Empresa Concessionária das Rodovias do Sul S.A. - EcosulThe concession operator has assumed the following commitments arising from the concession:
• Renovation,routinemaintenanceandpavementmaintenance of the five highway stretches that form the system, totaling a length of 509.1 km as estimated in the operating costs and investment schedule of the operation program.
Rodovia das Cataratas S.A. - EcocataratasThe concession operator has assumed the following commitments arising from the concession:
• Renovation,routinemaintenanceandupkeepof pavement in access roads leading to the highways, as follows (except operation)
– 7.64 km of the PR-474 Highway access road between BR-277 and the city of Campo Bonito, State of Paraná.
– 37.03 km of the PR-180 Highway access road between BR-277 and the Juvinópolis district in the city of Cascavel, State of Paraná.
– 13.58 km of the PR-590 Highway access road between BR-277 and the city of Ramilândia, State of Paraná.
– 13.59 km of the PR-874 Highway access road to tourist resort in the city of Santa Terezinha de Itaipu, State of Paraná.
Concessionária das Rodovias Ayrton Senna e Carvalho Pinto S.A. - EcopistasThe concession operator has assumed the following commitments arising from the concession:
• Paymentofconcessionfeeobligations,totalingR$595,157 (R$570,422 adjusted to present value), plus adjustment for inflation based on the IPCA index, of which R$118,800 was paid in June 2009, and the remaining balance was paid in 18 monthly installments. The last obligation was paid on December 31, 2010.
12/31/2016 12/31/2015
2017 - 16,578
2018 7,427 5,543
7,427 22,121
12/31/2016 12/31/2015
Opening balance 43,490 52,866
Cost (Note 32) 53,079 55,647
Monetary gain or loss on creditor for the concession (Note 33)
4,497 7,352
Payment of principal (68,625) (72,375)
CLOSING BALANCE 32,441 43,490
Changes in concession rights payable are as follows:
II) Other commitments related to concession rights
Concessionária Ecovia Caminho do Mar S.A.The concession operator has assumed the commitment arising from renovation, routine maintenance and upkeep of pavement in access roads leading to the highways, as follows (except operation):
• 2.6kmofthePR-804HighwaystretchbetweenBR-277 and PR-408;
• 13.2kmofthePR-408HighwaystretchbetweenMorretes and BR-277;
• 9.6kmofthePR-408HighwaystretchbetweenPR-340 and Morretes;
• 13kmofthePR-411Highwaystretchbetween PR-410 (São João da Graciosa) and Morretes.
ECORODOVIAS72
ECO101 Concessionária de Rodovias S.A.The concession operator has assumed the following commitments arising from the concession:
• Duringtheconcessionperiod,theconcessionoperator shall allocate R$620 p.a. to projects and studies intended for the technological development, according to ANTT regulation.
Concessionária Ponte Rio-Niterói S.A. - EcoponteThe concession operator has assumed the following commitments arising from the concession:
• PaymentofANTTinspectionfeeattheinitialamount of R$2,524 readjusted on an annual basis by the highway toll readjustment rate.
• Duringtheconcessionperiod,theconcession operator shall allocate R$421 p.a. to projects and studies intended for the technological development, according to ANTT regulation.
The concession operators estimate the amounts listed below, at December 31, 2016, to meet investment obligations, renovations and maintenance until the end of the service concession arrangements. These amounts may be changed due to contractual adjustments and periodic reviews of cost estimates during the concession period, being checked at least annually.
12/31/2016
ECOVIAESTIMATED
TERM2017 TO
2021
ECOSULESTIMATED
TERM2017 TO
2026
ECOVIASESTIMATED
TERM2017 TO
2018
ECOCATARATASESTIMATED
TERM2017 TO 2021
ECOPISTASESTIMATED
TERM2017 TO
2039
ECO101ESTIMATED
TERM2017 TO
2038
ECOPONTEESTIMATED
TERM2017 TO
2045
TOTAL
Nature of costs
Improvements in infrastructure
74,129 239,332 115,064 129,623 66,274 1,698,843 725,679 3,048,944
Special conservation (maintenance)
48,232 66,320 228,847 263,317 404,445 546,496 439,444 1,997,101
Equipment 11,265 12,816 43,057 8,496 220,238 334,482 93,520 723,874
TOTAL 133,626 318,468 386,968 401,436 690,957 2,579,821 1,258,643 5,769,919
12/31/2015
ECOVIAESTIMATED
TERM2016 TO 2021
ECOSULESTIMATED
TERM2016 TO 2026
ECOVIASESTIMATED
TERM2016 TO 2018
ECOCATARATASESTIMATED
TERM2016 TO 2021
ECOPISTASESTIMATED
TERM2016 TO 2039
ECO101ESTIMATED
TERM2016 TO 2038
TOTAL
Nature of costs
Improvements in infrastructure
81,162 281,710 171,856 22,937 104,208 1,682,178 2,344,051
Special conservation (maintenance)
51,492 68,158 263,660 284,061 418,976 514,606 1,600,953
Equipment 11,062 16,053 44,418 60,915 207,565 317,588 657,601
TOTAL 143,716 365,921 479,934 367,913 730,749 2,514,372 4,602,605
In January 2017, the São Paulo State Official Gazette published an administrative denial referring to the contractual unbalance arising from changes in the project intended to extend Rodovia Carvalho Pinto, which is under the concession granted to Ecopistas by Artesp, with an additional amount of R$284 million,
from which R$54 million have already been realized in 2016 and R$234 million are expected to be realized in the next years. The Company understands that the additional amount of R$284 million would restore the contractual balance and it intends to demand it before court.
SUSTAINABILITY REPORT 2016 73
FINANCIAL STATEMENTS
27. INFORMATION ON THE SERVICE CONCESSION ARRANGEMENTS OF SUBSIDIARIES ECOVIA, ECOCATARATAS AND ECOPORTO SANTOS
Additional information on the concession arrangement
EcocataratasRodovia das Cataratas S.A. - Ecocataratas is a party to the Paraná State concession program, duly bid and contracted in 1997, in conjunction with five other concession operators. The concession expires in November 2021.
The Concessionaire and the Granting Authority – the Pa-rana State Department of Roads (DER/PR) entered into an Amendment to the Concession Arrangement 073/97 on October 27, 2016, through which both parties promot-ed the economic and financial balance of the agreement and ended any legal claims relating to this matter.
In November 2016, the decision of the Federal Audit Court deriving from the appreciation of the reexamination requests submitted by the Concessionaires in April 2012 was ruled down, in view of the audit requested by the Brazilian National Congress for concession arrangements of Paraná State highways. This decision determines that the Granting Authority analyze the existence of any economic and financial unbalance in the contracts and adopt the tariff periodic review clause.
Also in December 2016, the decision of the Paraná State Audit Court referring to the preliminary audit report of Ecocataratas’ concession arrangement was ruled down. The referred to judgment partially included the audit report recommendation for implementation of an appropriate audit structure by the Regulatory Bodies, as well as converted this procedure into an extraordinary accountability assessment. The Concessionaire, the Granting Authority and the Regulatory Agency filed appeals on the referred to decision.
There is still no final decision.
Management analyzed these matters in detail and concluded that, although there are associated risks, the likelihood of these events significantly affecting the Company’s financial position and its operations is not probable.
Any decision from the Audit Court may still be subject to analysis before the Judiciary.
EcoviaConcessionária Ecovia Caminho do Mar S.A. is a party to the Paraná State concession program, duly bid and contracted in 1997, in conjunction with five
other concession operators. The concession expires in November 2021.
The former Paraná State Administration between 2002 and 2010 sought to downsize or suppress the State highway concession program through administrative and legal actions. The litigation includes the following main fronts: takeover of concessions, expropriation of controlling shares, attempt to forfeit contracts, denial to adjust tariff from 2003 to 2010, attempt to nullify current contractual amendments and consideration of accounting data to the detriment of regular contractual data. The Paraná State concession operators have succeeded in all the litigation fronts.
The contractual tariff adjustments from 2003 to 2010, systematically denied by the State of Paraná, were implemented under court orders. The parties mutually agreed to settle this matter, and the concessionaires’ right to the tariff adjustments was recognized. The referred to settlement was approved in court and the corresponding claims were ended.
The Company seeks, by legal actions, recognition of events that caused imbalance of the concession contracts. If such events are recognized, they will lead to the right to reinstatement of the original economic/financial status of the agreement.
In view of the current state administration, the concessionaires initiated an amicable contract review process as from August 2011.
In November 2016, the decision of the Federal Audit Court deriving from the appreciation of the reexamination requests submitted by the Concessionaires in April 2012 was ruled down, in view of the audit requested by the Brazilian National Congress for concession arrangements of Paraná State highways. This decision determines that the Granting Authority analyze the existence of any economic and financial unbalance in the contracts and adopt the tariff periodic review clause.
Management analyzed these matters in detail and con-cluded that, although there are associated risks, the likelihood of these events significantly affecting the Com-pany’s financial position and its operations is not probable.
At the moment, it is not possible to predict the deadline for the closure of ongoing proceedings.
Ecoporto Santos S.A.The lease agreement entered into between Companhia Docas do Estado de São Paulo - CODESP and Ecoporto Santos S.A. is a 25-year agreement. Five amendments to the agreement were entered into; however, such terms do not change the term of the
ECORODOVIAS74
agreement, which shall initially expire on June 12, 2023. The Sixteenth Clause of the agreement provides for its extension duly requested up to 12 months prior to the expiration date. The Granting Authority may grant such extension to the extent that Ecoporto Santos has met all legal and contractual obligations. After the establishment of the new regulatory framework of the sector, the Granting Authority became the Special Secretariat of Ports (SEP), recently incorporated by the Ministry of Transportation, Ports and Civil Aviation (MTPAC), and the National Water Transportation Agency (ANTAQ) will be responsible for the inspection and regulation of the sector. Additionally, concerning the agreement extension, compliance with provisions of SEP Ordinance No. 349/2014 and ANTAQ Resolution No. 3220/2014 is deemed necessary, which require that Ecoporto Santos request be accompanied by an Investment Plan, and Environmental, Technical and Economic Feasibility Study (EVTEA), as well as by information required to evaluate compliance with existing contractual obligations. Ecoporto Santos requested the extension of the agreement, attaching the relevant documentation to this proceeding. The investment plan was approved preliminarily by the Ministry of Transportation, Ports and Civil Aviation through Ruling No. 702 of December 8, 2016, and was sent to the National Agency for Waterway Transportation (ANTAQ) for analysis and approval. In view of the current legislation and Ruling No. 702 of the Ministry of Transportation, Ports and Civil Aviation, management considers that the chances of the Lease Agreement extension right being recognized are high, provided that Ecoporto Santos’ performance is maintained and subject to the provisions of ANTAQ
Resolution No. 3220/2014 and of the Port Department (SEP) Ruling No. 349/2014, especially the feasibility study for a new contractual period.
Consequently, the public interest in maintaining the activities will be sustained, and this will be the line of action that Ecoporto Santos will adopt. It should be noted that there is no definitive decision on two class actions, No. 0010874-75.2002.403.6104 and No. 0002925- 92.2005.4.03.6104 (1st Federal Court – Santos Chapter), currently being judged by the Federal Regional Court (TRF) of the 3rd Chapter. These actions question the fairness of the Lease Agreement and the amendments thereto. In 2015, the Federal Regional Court of the 3rd Chapter denied the appeals filed by the Company.
Currently, this proceeding is suspended for 180 days. After this suspension period, there are motions for clarification to be judged by the TRF of the 3rd Chapter. Thereafter, if the decisions are maintained, they will be subject to appeal to the Superior Courts. The Company management maintains its expectation of success in the final decision on these actions, based on opinions of renowned jurists and on decisions relating to administrative proceedings addressing the same matter. There are decisions handed down within the scope of Complaint No. 012.194/2002-1 of the Federal Audit Court and of Administrative Proceeding No. 50300.000155/2013-62 of ANTAQ, on the same matter, recognizing the possibility of extending the lease arrangement. The amortization and depreciation term considers the extension of the concession arrangement for another 25 years (until 2048) and management will assess this scenario on an annual basis.
COMPANY CONSOLIDATED
12/31/2016 12/31/2015 12/31/2016 12/31/2015
Salaries and other obligations payable 6,304 12,653 27,197 39,960
Social Security Tax (INSS) payable 2,043 291 6,807 4,621
Unemployment Compensation Fund (FGTS) payable 415 103 1,700 3,291
Withholding Income Tax (IRRF) payable 1,691 261 3,380 2,832
Accrual for vacation pay 311 476 14,415 21,640
Trade union dues payable - - 808 18
Taxes on accruals - INSS and FGTS 109 168 4,836 7,131
10,873 13,952 59,143 79,493
28. SOCIAL AND LABOR LIABILITIES
Accrued payroll and related charges were recognized in the Company’s P&L under ‘Cost of services’ and ‘Ge-
neral and administrative expenses’, according to the employee’s assignment.
SUSTAINABILITY REPORT 2016 75
FINANCIAL STATEMENTS
29. PROVISION FOR LOSSES DUE TO TAX, LABOR AND CIVIL CONTINGENCIES
Accounting policyEcoRodovias Group is party to various legal and administrative proceedings. Provisions are recognized for all contingencies in connection with legal proceedings for which it is likely that a cash outflow will be required to settle the contingency/obligation and a reasonable estimate can be made.
COMPANY
CIVIL (A) TOTAL
Balances at December 31, 2014 75 75
(+/-) Supplement (reversal) of provision - -
(-) Payments (75) (75)
(+) Monetary restatement - -
Balances at December 31, 2015 - -
(+/-) Supplement (reversal) of provision - -
(-) Payments - -
(+) Monetary restatement - -
BALANCE AT DECEMBER 31, 2016 - -
CIVIL (A) LABOR (B) TAX (C) TOTAL
Balances at January 1, 2015 128,453 23,905 6,688 159,046
Acquisition of companies (*) 25,103 10,272 8,234 43,609
(+/-) Supplement (reversal) of provision (9,267) 3,430 4,135 (1,702)
(-) Payments (7,259) (5,472) (1,340) (14,071)
(+) Monetary restatement 18,437 7,953 1,789 28,179
(+/-) Reclassifications (493) 493 - -
BALANCES AT DECEMBER 31, 2015 154,974 40,581 19,506 215,061
CIVIL (A) LABOR (B) TAX (C) TOTAL
Balances at January 1, 2016 154,974 40,581 19,506 215,061
Assets and liabilities held for sale (*) (5,616) (21,019) (16,088) (42,723)
(+/-) Supplement (reversal) of provision 6,862 7,796 758 15,416
(-) Payments (2,712) (8,444) (197) (11,353)
(+) Monetary restatement (747) 5,138 1,576 5,967
(+/-) Reclassifications (6,240) 2,571 3,669 -
BALANCES AT DECEMBER 31, 2016 146,521 26,623 9,224 182,368
And unfavorable outcome for such proceedings, either individually or in the aggregate, could lead to a significant adverse effect on the Company’s financial position or business.
Changes in the provision for the year are as follows:
(a) Civil proceedings
The amount provisioned mainly refers to claims for compensation
for damages and losses due to highway accidents. The Company
and its subsidiaries set up other provisions for civil contingencies,
which at December 31, 2016 totaled R$99,778 (R$66,900 at
December 31, 2015), whose likelihood of loss was assessed by the
Company’s legal counsel and management as possible; accordingly,
no provision was recognized.
ECORODOVIAS76
The main proceedings assessed as probable losses, i.e., for which a
provision was recorded, are as follows:
(i) Indirect subsidiary Ecovias is party to a civil class action
brought by the Public Prosecution Office of São Paulo
State against the Company because it understands that the
Concessionaire did not pay the amount relating to environment
compensation on the construction of the descending lane of
Imigrantes highway. The claims made as advanced relief were
dismissed and the interlocutory appeal filed to reverse the
decision was denied. In April 2013, a reconciliation hearing
was held as requested by the Company, in order to try a legal
agreement, which was unsuccessful. Currently, the civil class
action is awaiting the beginning of the expert investigation
(there is no judicial decision thereon thus far). On account
of the possibility of a legal agreement and likelihood of
loss assessed as probable, the amount of R$30,920 was
provisioned at September 30, 2013 (R$45,258 restated at
December 31, 2015), matched against intangible assets, under
“Service concession arrangements”. The assumption for
recording under the heading “Service Concession Agreement”
was made by Company management, considering this value
will be subject to full financial rebalancing of the service
concession agreement with the Granting Authority. On
September 29, 2014, a escrow deposit amounting to R$38,828
was offered and, for December 31, 2016, this deposit amount is
restated at R$46,064 (R$45,258 at December 31, 2015).
(ii) Direct subsidiary Ecoporto Santos filed a precautionary action
with a motion for a preliminary injunction to suspend the
effects of the administrative decision handed down by CADE,
which found the collection of the Segregation and Delivery
of Containers service offensive to the economic order. The
collection was being performed up to August 2012, through
a legal authorization by means of deposit available to the
trial court. Upon the issue of an adverse judgment in August
2012, the Company decided to suspend such collection,
safeguarding the right of collection in due time. Accordingly,
appeals and judicial orders are pending judgment that aims
granting to the Company authorization to recover such
collection. At December 31, 2016, the contingency amounts to
R$72,025 (R$73,111 at December 31, 2015), for which escrow
deposits were made and these restated amounts are equivalent
to the provision set up.
The main proceeding assessed as possible loss, i.e., for which no
provision was recorded, is as follows:
(i) Washington Barbeito de Vasconcellos, Zardust Em
preendimentos Marítimos Ltda. Agnes Dagmar Bullentini
Barbeito de Vasconcellos and Yuri Bullentini Barbeito de
Vasconcellos (“Plaintiff”) filed a lawsuit against the Company
and its subsidiaries Ecoporto Transporte Ltda. (“Ecoporto
Transporte”), Ecoporto Santos S.A. (“Ecoporto Santos”)
and Termares Terminais Marítimos Especializados Ltda.
(“Termares”). Aba Infra-Estrutura e Logística Ltda. (“Aba”)
and FCA Comércio Exterior e Logística Ltda. (FCA”) are
also defendants in the lawsuit. The plaintiffs claim that the
defendants be ordered to pay approximately R$164,760,
restated for December 31, 2015, as a “premium for the sale of
equity interest of COMPLEXO TECONDI”, which supposedly
corresponds to 50% overprice that their former Aba and
FCA shareholders received from the Company for the sale
of Ecoporto Santos. The plaintiffs claim that the defendants
be required to release part of the sale price already paid and
maintained in an escrow account, at the restated amount of
R$86,352 as of December 31, 2015, on the alleged grounds
that this retention would have no legal basis, in addition to a
contractual fine amounting to R$6,045. On July 27, 2015, the
Company challenged the claim together with its subsidiaries.
A reply and rejoinders were filed thereafter. There was no
reconciliation at the hearing designated and a decision by the
judge is now awaited for continuation of the lawsuit. Based on
the opinion of the lawyers engaged in the case, the Company is
confident that the outcome will be favorable, the loss of which
is assessed as possible pursuant to the applicable accounting
standards.
(b) Labor claims
The amount provisioned mainly refers to claims for compensation
for occupational injuries and overtime pay. There are no proceedings
involving an individual significant amount. At December 31, 2016,
there are also other labor claims totaling R$101,328 (R$91,899 at
December 31, 2015), whose likelihood of loss was assessed by the
Company’s legal counsel and management as possible; accordingly,
no provision was set up.
(c) Tax proceedings
The amount provisioned corresponds mainly to rate differences and
tax bases of taxes paid on ancillary revenues. At December 31, 2016,
there are also other tax proceedings totaling R$38,503 (R$19,263
at December 31, 2015), which were assessed as possible losses by
the Company’s legal advisors and management and, therefore, no
provision was set up.
The main tax proceedings are as follows:
Tax proceedings challenging the tax assessment notice issued by
the Brazilian IRS in Pelotas, State of Rio Grande do Sul, for the
nonpayment of income and social contribution taxes on profit
sharing paid to the management of indirect subsidiary Ecosul, and
the challenging of the depreciation rate of improvements made in
concession properties, whose likelihood of an unfavorable outcome
was assessed by the legal advisors as possible. The amount
estimated at December 31, 2016 is R$9,045 (R$8,542 at December
31, 2015).
In August, a decision of the Superior Labor Court (TST) altered
the indexation rate for labor claims. The Daily Reference Rate (TR)
previously used was replaced by Special Extended Consumer
Price Index (IPCA-E) plus 12% interest per annum and shall be
used for the restatement of labor claims retroactively from June
30, 2009. In a recent decision, the Supreme Court of Justice
granted an injunction to a given class entity for the suspension of
restatements by the IPCA-E as determined by the Superior Labor
Court, upholding grounds for discussion on the appropriateness of
applying that restatement.
The Company’s legal counsels believe that there are good grounds
for defense which would afford the Company success in not
applying IPCA-E, and in its opinion represents a possible likelihood
of success.
SUSTAINABILITY REPORT 2016 77
FINANCIAL STATEMENTS
30. EQUITY – CONSOLIDATED
a) CapitalAt December 31, 2016, fully subscribed and paid-in capital of R$360,900 was divided into 558,699,080 registered common shares with no par value.
The Extraordinary General Meeting held on September 12, 2016 decided to absorb the Company’s accumulated loss, reducing the Company capital from R$1,320,549 to R$360,900.
b) Authorized capitalIn accordance with its Articles of Incorporation, the Company is authorized to increase its capital to up to R$2,000,000, after a Board of Directors’ resolution, subject to the statutory terms and conditions for issue and exercise of preemptive rights.
c) Income reserve – legalLegal reserve is set up based on 5% of the adjusted net income for the period up to a limit of 20% of capital.
On September 12, 2016, the absorption of accumulated losses for 2016 was approved through use of legal reserve totaling R$160,791.
At December 31, 2016, R$7,791 was recorded as follows:
R$43,013 referring to interim dividends for 2016 - as follows:
2016
Loss for the year (964,622)
Absorption of loss through legal reserve 160,791
Absorption of loss through capital 959,649
155,818
Setup of legal reserve (7,791)
d) Income reserve – capital budgetAt December 31, 2016, no income reserve was recorded.
e) Proposed dividendsShareholders are entitled to dividends and/or interest on capital of at least 25% of the adjusted net income for the period, calculated in conformity with Article 202 of Law No. 6404/76.
For the year ended December 31, 2016, R$146,538 were paid - R$103,525 referring to 2015 and
2016 2015
Income/(loss) for the year (964,622) 108,974
Absorption of loss through legal reserve
160,791 -
Absorption of loss through capital
959,649 -
155,818 108,974
Setup of legal reserve (7,791) (5,449)
Dividend calculation base 148,027 103,525
Interim dividends paid (43,013) -
Mandatory minimum dividends
- (25,881)
Dividends paid (payable) in the following year
(105,014) (77,644)
f) Capital reserve - stock option planThe Company measures the cost of share-settled transactions with management based on the fair value of membership certificates on their grant date. In order to determine fair value, the Company contracts an external pricing specialist.
The cost of equity-settled transactions is recognized under “personnel expenses” together with a corresponding increase in equity, over the period in which the performance and/or service conditions are met, ending on the date on which the relevant employees become fully entitled to the award (vesting date).
Equity-settled transactions in which the plan is changed, the minimum expense recognized under “Personnel expenses” corresponds to the expenses as the terms had not been changed. An additional expense is recognized for any change that increases the total fair value of the equity-settled payment agreement.
The outstanding options dilution effect is reflected as additional share dilution in the calculation of diluted earnings per share.
The purpose of the stock option plan issued in 2010 is to allow beneficiaries to become the Company’s shareholders and participate directly and actively in bringing positive results to the Company. Statutory officers of the Company
ECORODOVIAS78
and its subsidiaries, key management personnel that are not statutory managers are eligible to the plan.
The option grant should not exceed 2% of the Company’s effectively issued common shares, which shall only be treasury shares.
The price of options will correspond to the Company’s share price, adjusted to inflation based on IPCA or another similar index selected at the Company’s Annual General Meeting.
The Board of Directors made 11,666,277 common shares available for the plan, as follows:
DATE1ST GRANT
08/31/20102ND GRANT03/22/2011
3RD GRANT04/25/2012
4TH GRANT04/25/2013
5TH GRANT04/28/2014
Number of stock options 685,764 1,212,045 1,524,074 2,594,808 5,649,586
Price in the period - R$ per share R$9.95 R$13.06 R$13.58 R$17.51 R$12.18
Adjustment index IPCA IPCA IPCA IPCA IPCA
DATE1ST
GRANT2ND
GRANT3RD
GRANT4TH
GRANT5TH
GRANTTOTAL
At December 31, 2010 685,764 - - - - 685,764
Granted - 1,212,045 - - - 1,212,045
Exercised (21,942) - - - - (21,942)
Cancelled (17,553) - - - - (17,553)
At December 31, 2011 646,269 1,212,045 - - - 1,858,314
Granted - - 1,524,074 - - 1,524,074
Exercised (257,410) (196,899) - - - (454,309)
At December 31, 2012 388,859 1,015,146 1,524,074 - - 2,928,079
Granted - - - 2,594,808 - 2,594,808
Exercised (79,886) (168,658) (96,913) - - (345,457)
Cancelled (81,715) (246,373) (377,491) (622,951) - (1,328,530)
At December 31, 2013 227,258 600,115 1,049,670 1,971,857 - 3,848,900
Granted - - - - 5,649,586 5,649,586
At December 31, 2014 227,258 600,115 1,049,670 1,971,857 5,649,586 9,498,486
Cancelled (39,361) (85,320) (131,443) (37,158) (723,967) (1,017,249)
At December 31, 2015 187,897 514,795 918,227 1,934,699 4,925,619 8,481,237
Cancelled - - (26,454) (334,426) (945,785) (1,306,665)
Expired (187,897) - - - - (187,897)
AT DECEMBER 31, 2016 - 514,795 891,773 1,600,273 3,979,834 6,986,675
The Company recognizes in P&L, during the year services are provided, the vesting period and the costs of the compensation paid to beneficiaries based on the fair value of the stock options on grant date, using the Black-Scholes pricing model to measure the fair values of the stock options. For the year ended December 31, 2016, the Company recorded R$2,768 (R$4,910 at December 31, 2015) under ‘Stock option plan’.
The Company will settle this stock option plan by delivering its own shares, which will be held in treasury up to the actual exercise of the stock options by the beneficiaries.
Changes in the number of stock options are as follows:
SUSTAINABILITY REPORT 2016 79
FINANCIAL STATEMENTS
The right to exercise the option will vest under the conditions and terms presented below:
YEARAVERAGE STRIKE
PRICE IN R$NUMBER OF
SHARES
AVERAGE FAIR VALUE OF
OPTION IN R$
TOTAL COST
EXERCISE PERIOD
2017 18.85 1,395,027 3.16 4,408 11 months
2018 14.92 994,960 2.10 2,089 23 months
2,389,987 2.63 6,497
1ST
PROGRAM2ND
PROGRAM3RD
PROGRAM4TH
PROGRAM
Date 08/31/2010 05/30/2012 06/05/2013 06/06/2014
Term 365 days 365 days 365 days 365 days
Weighted average number of outstanding common shares
144,003,000 143,737,879 200,669,081 199,611,859
Maximum number of common shares to be acquired 4,000,000 1,500,000 1,700,000 2,400,000
COMPANY AND CONSOLIDATED
SHARES AVERAGE COST R$ PER
SHARE NUMBER AMOUNT
Closing balance at December 31, 2011 149,502 (2,011) 13.45
Exercised in 2012 (454,309) 6,945 15.29
Buyback in 2012 480,495 (7,759) 16.15
Closing balance at December 31, 2012 175,688 (2,825) 16.08
Exercised in 2013 (345,457) 5,883 17.03
Buyback in 2013 712,482 (11,546) 16.21
Transfer to chief officers (3) - 17.03
Closing balance at December 31, 2013 542,710 (8,488) 15.64
Buyback in 2014 1,690,282 (20,979) 12.36
Closing balance at December 31, 2014 2,232,992 (29,467) 13.20
Closing balance at December 31, 2015 2,232,992 (29,467) 13.20
CLOSING BALANCE AT DECEMBER 31, 2016 2,232,992 (29,467) 13.20
g) Treasury shares
Accounting policyOwn equity instruments that are repurchased (treasury shares) are recognized at cost and deducted from equity. No gain or loss is recognized in the income statement upon purchase, sale, issue or cancellation of Company’s own equity instruments. Any difference between carrying amount and consideration is recognized in other capital reserves.
The Board of Directors approved four Share Buyback Programs, which will take place without capital reduction and with the use of reserves, for cancellation or holding in treasury, as well as for resale, placement in the market or as collateral for the Company’s stock option plans, as follows:
Changes in treasury shares are as follows:
ECORODOVIAS80
The Company holds 2,232,992 common shares held in treasury calculated based on their average quotation on the last trading session at December 30, 2016, i.e., R$18,400. Total amount of these shares, based on the trading session average quotation at December 30, 2016, is R$8.24.
The Company recognized a reserve for future purchase of shares under the stock option plan in the amount of R$50,285, which was transferred to line item ‘Capital reserve’, as provided for by the Articles of Incorporation.
h) Noncontrolling shareholders
concession arrangement, revenue received is allocated in reference to fair value related to services delivered.
(c) Port revenues arise from port operations, in addition to handling and storage of import and export cargo with a specific terminal in the port of Santos.
Revenue earned by direct subsidiaries operating in Santos Port: Ecoporto Santos, Ecoporto Transportes and Termares.
(d) Ancillary revenues refer to other revenues of highway concessionaires, such as the lease of area for fiber optics, use of highway land, sales of advertising, implementation and concession of access ways and other.
(e) Intercompany revenues refer to revenue from the rendering of administrative, financial, human resources, information technology, engineering and corporate procurement services for EcoRodovias Group companies.
Taxes on services renderedRevenues and expenses are recognized net of taxes on services rendered, except when the taxes on services rendered incurred in the purchase of goods or services are not recoverable from the relevant tax authorities. In this case, taxes on services rendered are recognized as part of acquisition cost of the asset or expense item, as applicable; and when amounts receivable and payable are presented together with the amount of taxes on services rendered.
When the net amount of taxes on services rendered, recoverable or payable, is included as a component of amounts receivable or payable in the statement of financial position.
12/31/2016 12/31/2015
Opening balance 55,979 53,817
Profit sharing 15,488 6,798
Recognized options granted 42 81
Capital contribution from noncontrolling shareholder
4,200 -
Payment of dividends to noncontrolling shareholders
(3,126) (4,717)
CLOSING BALANCE 72,583 55,979
12/31/2016 12/31/2015
Revenue from toll collection (a) 2,261,451 2,108,187
Construction revenue (b) 451,408 443,090
Port revenue (c) 290,501 352,702
Ancillary revenues (d) 75,746 71,905
Revenue from services rendered – intercompany (e)
7,779 13,728
Total gross revenue 3,086,885 2,989,612
Deductions from revenue (*) (257,889) (253,893)
NET REVENUE 2,828,996 2,735,719
31. NET REVENUE – CONSOLIDATED
Accounting policy
RevenuesRevenue is measured at fair value of the consideration received or receivable, less any estimates of cancellations, and the income from operations is determined in accordance with the accrual basis of accounting, as follows:
(a) Revenues from tolls, recognized when users pass through the toll plaza.
Revenues from advance sales of toll coupons are recorded as “Deferred income” in noncurrent liabilities, under “Other accounts payable”, and are allocated as income to P&L for the year as users pass through the toll plaza.
(b) Revenue related to construction or improvement services under the service concession agreement is recognized based on the stage of work completion. Revenues from operations or construction are recognized for the period in which the services are rendered by the Company. When the Company renders more than one service under a service
SUSTAINABILITY REPORT 2016 81
FINANCIAL STATEMENTS
(*) Construction revenue is not subject to tax on revenue. The table below presents taxable revenues for an appropriate analysis of revenue deductions:
12/31/2016 12/31/2015
Tax base
Revenue from toll collection 2,261,451 2,108,187
Port revenues 290,501 352,702
Ancillary and intercompany revenues 83,525 85,633
2,635,477 2,546,522
Deductions
Cofins (i) (106,298) (106,040)
PIS (ii) (23,087) (22,996)
ISS (iii) (128,302) (124,616)
Other - ICMS (202) (241)
(257,889) (253,893)
(i) Rate for: concessionaires 3% and ports and logistics 7.6%.
(ii) Rate for: concessionaires 0.65% and ports and logistics 1.65%.
(iii) Rate average of 4.8%.
32. OPERATING COSTS AND EXPENSES – BY NATURE
COMPANY CONSOLIDATED
12/31/2016 12/31/2015 12/31/2016 12/31/2015
Personnel 14,475 29,351 332,643 388,326
Maintenance, upkeep and other 223 416 82,305 91,316
Third-party services (*) 7,470 14,898 272,504 244,336
Insurance (Note 37) 190 371 19,750 19,687
Depreciation and amortization 658 689 339,966 344,208
Granting authority (Note 26) - - 53,079 55,542
Lease of real estate, machinery and forklifts 1,225 1,797 30,114 30,468
Provision for maintenance - - 104,729 91,888
Cost of construction work - - 451,408 443,090
Other operating costs and expenses 1,048 1,802 69,699 78,637
25,289 49,324 1,756,197 1,787,498
Classified as:
Cost of services rendered - - 1,545,435 1,481,823
General and administrative expenses 25,289 49,324 210,762 305,675
25,289 49,324 1,756,197 1,787,498
(*) The third-party services are basically composed of assurance and advisory services, freight, cleaning services, surveillance, ambulances, rescues and removals.
ECORODOVIAS82
33. FINANCIAL INCOME (EXPENSES)
12/31/2016 12/31/2015
Basic earnings/(loss) – P&L for the year (1.73) 0.20
Diluted earnings/(loss) – P&L for the year (1.71) 0.19
Basic earnings/(loss) – P&L from continuing operations (0.47) 0.24
Diluted earnings/(loss) – P&L from continuing operations (0.46) 0.23
COMPANY CONSOLIDATED
12/31/2016 12/31/2015 12/31/2016 12/31/2015
Financial income:
Short-term investments yield 5,834 9,859 101,875 86,500
Intercompany loans 4,317 12,570 - -
Monetary restatement of tax credits 3,793 4,077 14,652 29,847
Exchange gain or loss on loans - - 19,954 -
Other 1 8 2,056 13,302
13,945 26,514 138,537 129,649
Financial expenses:
Interest on debentures (54,932) (60,532) (364,312) (329,445)
Interest on loans and financing and finance lease - (37,192) (102,085) (89,800)
Monetary gain or loss on debentures - - (145,412) (218,877)
Monetary gain or loss on concession fee obligations (Note 26)
- - (4,497) (6,215)
Amortization of costs incurred to issue debentures (607) (732) (9,118) (9,706)
Present value adjustment – provision for maintenance and construction work
- - (30,136) (21,960)
Bank expenses (10) (8) (240) (515)
Monetary gain or loss on loans - - (1,763) (33,573)
Exchange gains (losses) on loans - - - (33,064)
Interest on intercompany loans (35,756) (19,186) - -
Monetary restatement – contingencies (408) (48) (13,564) (19,503)
Charges on lease - - (29) -
Other (38,574) (8,873) (21,741) (30,200)
(130,287) (126,571) (692,897) (792,858)
FINANCIAL INCOME (EXPENSES), NET (116,342) (100,057) (554,360) (663,209)
34. EARNINGS/(LOSS) PER SHARE – CONSOLIDATED
SUSTAINABILITY REPORT 2016 83
FINANCIAL STATEMENTS
a) Basic earnings/(loss) per share
12/31/2016 12/31/2015
Income/(loss) attributable to controlling shareholders (964,622) 108,974
Income/(loss) attributable to controlling shareholders (259,833) 131,613
Weighted average number of common shares issued 558,699 558,699
Weighted average of treasury shares (2,233) (2,233)
Weighted average number of outstanding common shares 556,466 556,466
Basic earnings/(loss) per share – R$ (1.73) 0.20
Basic earnings/(loss) per share from continuing operations - R$ (0.47) 0.24
12/31/2016 12/31/2015
Income/(loss) attributable to controlling shareholders (964,622) 108,974
Income/(loss) attributable to controlling shareholders (259,833) 131,613
Weighted average number of outstanding common shares 556,466 556,466
Adjustments for stock option plan 2,233 2,233
Executive plan for stock option plan 6,987 8,487
Weighted average number of common shares for diluted earnings/(loss) 565,686 567,186
Diluted earnings/(loss) per share – R$ (1.71) 0.19
Diluted earnings/(loss) per share from continuing operations - R$ (0.46) 0.23
b) Diluted earnings/(loss)
35. PROFIT SHARING (PLR)The Company and its subsidiaries’ policy provides for paying employees’ profit sharing, tied to the attainment of specific goals and targets, which are established and paid in accordance with the collective labor agreement entered into with the employees’ union. At the year ended December 31, 2016, profit sharing totaled R$4,300 (R$5,529 at December 31, 2015), which was allocated to profit or loss under line items “Cost of services rendered” and “General and administrative expenses”.
ECORODOVIAS84
36. RISK MANAGEMENT AND FINANCIAL INSTRUMENTS – CONSOLIDATED
Capital management
EcoRodovias Group manages its equity capital to ensure that its companies are able to carry out their ordinary activities while maximizing returns of all interested or involved parties by optimizing debt and equity balances.
The Company’s capital structure consists of its net debt and its equity.
The Company reviews its capital structure on a half-yearly basis. As part of this review, it considers the cost of capital and inherent risks to each capital class.
Debt-to-equity ratios
COMPANY CONSOLIDATED
12/31/2016 12/31/2015 12/31/2016 12/31/2015
Debt (a) - 615,113 4,962,701 5,323,701
Debt (a) Cash and cash equivalents and marketable securities - restricted
(3,096) (62,873) (658,623) (823,217)
Net debt (3,096) 552,240 4,304,078 4,500,484
Equity (b) 499,963 1,582,475 572,546 1,638,454
NET DEBT-TO-EQUITY RATIO (0.01) 0.35 7.52 2.75
(a) Debt is defined as current and noncurrent loans and financing, finance lease, debentures and concession rights payable, as detailed in Notes 20, 21,
22 and 25.
(b) Equity includes all the Company’s capital and reserves, managed as capital.
General considerations
• ManagementoftheCompanyanditssubsidiariesselects the financial institutions in which short-term investments can be made and sets the limits of the fund allocation percentages and amounts to be invested in each financial institution. Short-term investments are defined as loans and receivables.
• Short-terminvestmentsandmarketablesecurities – restricted: consisting of CDBs and fixed income investment funds, bearing weighted average rates of 99.8% of the CDI, which reflect the market conditions at the statement of financial position dates.
• Customers:arisedirectlyfromtheCompany’soperations, are classified as loans and receivables and recorded at original amounts, subject to provision for losses and present value adjustment, when applicable.
• Loans,financing,financelease,debenturesandconcession rights payable: classified as other financial liabilities; therefore, not measured at fair value, and accounted for based on the contractual amounts established for each transaction, as shown in Notes 20, 21, 22 and 25.
SUSTAINABILITY REPORT 2016 85
FINANCIAL STATEMENTS
Fair value of financial assets and liabilitiesThe book and market values of the main consolidated financial instruments of the Company and its subsidiaries at December 31, 2016, are as follows:
CLASSIFICATIONBOOK
BALANCEFAIR
VALUE
Assets:
Cash and banks Loans and receivables 32,806 32,806
Trade accounts receivable (a) Loans and receivables 154,790 154,790
Short-term investments and marketable securities (b)
Loans and receivables 625,817 625,817
Liabilities:
Trade accounts payable (a) Other financial liabilities 76,626 76,626
Loans and financing and finance lease (c) Other financial liabilities 823,632 832,632
Debentures (c) Other financial liabilities 4,106,628 4,106,628
Concession rights payable (d) Other financial liabilities 32,441 31,378
Phantom Stock Option (e) Other financial liabilities 6,575 6,575
(a) The balances of ‘Trade accounts receivable’ and ‘Trade accounts payable’ mature substantially within 45 days; therefore, they approximate the
fair value expected by the Company.
(b) The balances of short-term investments and marketable securities approximate fair value at the statement of financial position date.
(c) Loans, financing, finance lease and debentures approximate fair value at the statement of financial position date.
(d) Calculated excluding the adjustment to present value of the fixed installments of “Concession rights payable”.
(e) The phantom stock option amount is recorded under social and labor liabilities.
Risk managementThe Company is exposed to market risk, credit risk, and liquidity risk. Company management oversees the management of these risks, which are as follows:
a) Market risk Market risk is the risk that the fair value of
future cash flows from a financial instrument will fluctuate due to market price changes. For the Company, market prices comprise currency risk and interest rate risk.
i) Currency risk The currency risk arises from the possible
fluctuation of the exchange rates of foreign currencies used by certain Company’s subsidiaries, with which foreign currency-denominated equipment financing contracts are entered into.
At December 31, 2016 and 2015, debt balance in foreign currency – Finimp, is as follows:
12/31/2016 12/31/2015
Ecoporto Santos S.A. - US$ 32,215 31,647
ii) Interest rate risk The Company and its subsidiaries’ interest
rate risk arises from short-term investments and loans bearing interest according to floating interest rates, which may be pegged to fluctuations in inflation rates. This risk is managed by the Company through maintenance of loans at fixed and floating interest rates.
ECORODOVIAS86
EcoRodovias Group’s exposure to the interest
rates of financial assets and liabilities is described in item ‘Liquidity risk management’ of this Note.
Pursuant to its financial policies, the Company and its subsidiaries have been investing its funds in first-tier financial institutions and have not entered into transactions with financial instruments for speculative purposes.
b) Credit riskFinancial instruments that potentially expose the Company to concentrations of credit risk consist primarily of cash and banks, short-term investments and trade accounts receivable.
The Company maintains bank checking accounts and short-term investments with first- class financial institutions, approved by management, in accordance with objective criteria for credit risk diversification.
At December 31, 2016, the Company recorded receivables from Serviços de Tecnologia de Pagamentos S.A. - STP amounting to R$110,214 (R$105,115 at December 31, 2015), arising from toll revenues collected by the electronic payment system (“Sem Parar”), recognized under “Trade accounts receivable”.
c) Liquidity riskLiquidity risk is managed by the Company, which has an appropriate model of risk and liquidity management to control fund raising needs and management of liquidity in the short-, mid- and long-term. The Company manages liquidity risk, maintaining adequate reserves, bank credit lines and credit lines for raising loans it may judge appropriate through the continuous monitoring of forecasted and actual cash flows, and also by combining the maturity profile of financial assets and liabilities.
Contractual maturity is based on the most recent date on which the Company and its subsidiaries should settle the related obligations:
TYPEEFFECTIVE INTEREST
RATE (WEIGHTED AVERAGE) - % P.A.
NEXT 12 MONTHS
BETWEEN 13 AND 24
MONTHS
BETWEEN 25 AND 36
MONTHS
37 MONTHS
ONWARD
Debentures ECOVIA 115.0% CDI 170,831 - - -
Debentures ECOSUL 115.0% CDI 176,804 - - -
Debentures - ECS CDI + 1.18% p.a. 39,968 241,704 - -
Debentures - ECS CDI + 1.42% p.a. 64,506 53,654 218,999 191,842
Debentures - ECS CDI + 0.79% p.a. 104,547 88,881 - -
Debentures - ECS 114.0% CDI 35,888 219,208 - -
Debentures - Ecoporto Santos CDI + 1.85% p.a. 196,935 147,580 128,953 -
Promissory note Cataratas CDI + 2.65% p.a. 226,604 - - -
BNDES - Ecopistas TJLP + 2.45% p.a. 39,548 37,246 34,835 71,307
BNDES - Cataratas TJLP + 2.10% p.a. 7,223 3,970 - -
BNDES - Eco101 TJLP + 3.84% p.a. 32,362 35,139 35,139 329,961
Finame - Cataratas TJLP + 3.21% p.a. 95 - - -
Finame - Cataratas TJLP + 2.10% p.a. 62 - - -
BNDES - Eco101 UMSELIC+4.87%p.a. 55,937 - - -
Debentures - ECS IPCA + 5.00% p.a. 13,666 133,597 136,401 -
Debentures - Ecopistas IPCA + 8.25% p.a. 101,721 95,791 116,425 454,136
Debentures - ECS IPCA + 5.35% p.a. 36,547 32,939 35,679 822,480
Debentures - Ecovias IPCA + 3.80% p.a. 17,487 11,255 160,233 164,909
Debentures - Ecovias IPCA + 4.28% p.a. 67,046 43,163 46,755 1,540,214
>> CONTINUED
SUSTAINABILITY REPORT 2016 87
FINANCIAL STATEMENTS
TYPEEFFECTIVE INTEREST
RATE (WEIGHTED AVERAGE) - % P.A.
NEXT 12 MONTHS
BETWEEN 13 AND 24
MONTHS
BETWEEN 25 AND 36
MONTHS
37 MONTHS
ONWARD
BNDES - Ecopistas IPCA + 2.45% p.a. 7,436 7,027 6,636 25,365
Lease ECOSUL 25.13% p.a. 116 29 - -
Lease ECO101 21.27% p.a. 122 122 122 -
Finame ECOSUL 6.00% p.a. 61 58 55 48
Finame - Cataratas 2.50% p.a. 50 49 47 129
Finame - Cataratas 3.00% p.a. 57 28 - -
Finame - Ecoporto Santos 6.00% p.a 2,122 2,018 1,912 1,147
Finame - Termares 7.70% p.a. 888 - - -
Finame - Cataratas 6.00% p.a. 236 224 212 92
Finimp - Ecoporto Santos Libor6M + VC + 5.2% p.a. 49 - - -
Finimp - Ecoporto Santos Libor6M + VC + 2.0% p.a. 19,272 18,746 18,214 59,534
INTEREST TO BE INCURRED
TRANSACTION RISKSCENARIO I
- PROBABLESCENARIO II
- 25%SCENARIO III
- 50%
Interest on short-term investments (g)
CDI write-off 44,613 33,460 22,307
Interest on debentures (a) CDI increase (254,771) (287,985) (320,758)
Interest on debentures (c) IPCA increase (188,584) (191,982) (195,407)
Promissory notes (a) CDI increase (44,308) (46,503) (47,772)
Loans and financing (f)Currency basket increase
(661) (826) (991)
Loans and financing (e) US$ increase (3,575) (4,895) (6,386)
Loans and financing (d) TJLP increase (35,312) (44,140) (52,968)
Loans and financing (c) IPCA increase (2,806) (3,507) (4,208)
Interest on concession rights payable (b)
IGP-M increase (74) (92) (11)
Interest to be incurred, net (485,478) (546,470) (606,194)
>> CONTINUATION
Sensitivity analysis
Risk of changes in interest ratesThe sensitivity analysis was determined based on the exposure to interest rates of non- derivative financial instruments at year-end. For floating rate liabilities, the analysis is prepared assuming that the amount of the liability outstanding at year-end was outstanding during the entire year.
The sensitivity analysis was developed considering exposure to the variation in CDI, TJLP, IPCA and IGP-M and currency basket, the main indices of debentures and loans and financing contracted by the Company and its subsidiaries:
ECORODOVIAS88
Loans in foreign currency outstanding at December 31, 2016 are subject to fixed interest rate and were measured at amortized cost.
The rates considered (projected for 12 months, except for Libor, projected for six months) are as follows:
INDEXSCENARIO I
- PROBABLESCENARIO II
- 25%SCENARIO III
- 50%
CDI (a) 10.25% 12.81% 15.38%
IGP-M (b) 4.76% 5.95% 7.14%
IPCA (c) 4.65% 5.81% 6.98%
TJLP (d) 7.50% 9.38% 11.25%
US$ (e) 3.4900 4.3625 5.2350
Currency basket - UMBNDES (f) 1.7866 2.2333 2.6799
CDI (g) 10.25% 7.69% 5.13%
Libor6M 1.3177 1.6471 2.0589
TYPE COVERAGE
Warranty insurance R$1.2 million
All risk – sundry R$3.2 million
All risk – civil liability R$1.3 million
All risk – property damage R$11.7 million
Insurance - head office R$4 million
All risk – loss of revenue R$1.8 million
Vehicles FIPE table
All risk - maintenance and upkeeping
R$200 million
All Risk – port operations US$230 million
Multiple peril R$21 million
Gains and losses on these transactions are consistent with the policies and strategies established by management of the Company and its subsidiaries.
37. PRIVATE PENSION PLAN – CONSOLIDATEDThe Company has a private pension plan, under the defined contribution category, the costs of which are perfectly predictable and subject to control and administration. For the year ended December 31, 2016, the Company and its subsidiaries contributed R$4,012 (R$4,024 at December 31, 2015), recorded under “General and administrative expenses”.
38. INSURANCE COVERAGE – CONSOLIDATEDThe Company and its subsidiaries have insurance coverage based on the risks associated with its operations. Service concession agreements require concession operators to write insurance and maintain umbrella insurance coverage to maintain and guarantee their regular operations. Policies cover civil liability, according to the related service concession agreement, operational engineering risks, including problems faced during the construction stage, geological changes, fire and natural disasters (floods and landslides), property damages, and loss of revenue due to blockage of highways.
At December 31, 2016, the Company’s insurance coverage by insurance line is as follows:
SUSTAINABILITY REPORT 2016 89
FINANCIAL STATEMENTS
39. SEGMENT REPORTING – CONSOLIDATEDThe Company’s operating segments are reported in line with the internal reports provided to the Chief Operating Decision-maker (CODM).
For purposes of performance evaluation, the set of information on the segments and fund allocation is analyzed.
The main segmentation by line of business is based on:
a) ConcessionsHighways are the longest and most developed modes of transport in Brazil. The highway concessions connect major industrial, production, consumption and tourist centers, and the Brazil’s three largest ports (Santos, Paranaguá and Rio Grande), in addition to providing access to other countries of the Mercosur. This segment includes the following companies: Concessionária Ecovias dos Imigrantes S.A. Concessionária Ecovia Caminho do Mar S.A. Empresa Concessionária de Rodovias do Sul S.A. - Ecosul, Concessionária das Rodovias Ayrton Senna e Carvalho Pinto S.A. - Ecopistas, Rodovia das Cataratas S.A. - Ecocataratas, ECO101 Concessionária de Rodovias S.A. and Concessionária Ponte Rio Niterói S.A. - Ecoponte.
b) Holding and servicesThis segment includes EIL01, EIL02, EIL03 and EIL04 and EcoRodovias Concessões e Serviços S.A., as holding companies in the concessionaire segment and the parent company EcoRodovias Infraestrutura e Logística S.A.
c) PortsThis segment comprises port operations, as well as import and export cargo handling and warehousing activities, in its own terminal in the Port of Santos. Therefore, in this segment the following companies are stated: Ecoporto Santos S.A., Termares – Terminais Marítimos Especializados Ltda and Ecoporto Transporte Ltda.
Net revenue by segment is broken down as follows:
The performance of the Company’s segments was assessed based on the net operating revenue, profit for the year, and noncurrent assets. This measurement base excludes the effects of interest, income and social contribution taxes, and depreciation and amortization.
12/31/2016 12/31/2015
Concessions 86.0% 82.6%
Ports 8.5% 10.6%
Holding and services 5.5% 6.8%
ECORODOVIAS90
The tables below include summarized financial information relating to the segments as of December 31, 2016 and 2015. The amounts of P&L and total assets provided to the Executive Committee match the balances recorded in the financial statements, as well as the accounting practices adopted:
12/31/2016
ACCOUNTS CONCESSIONS PORTSHOLDING AND
SERVICES
Current assets 744,239 44,415 320,877
Noncurrent assets 4,189,789 693,763 3,886,684
Total assets 4,934,028 738,178 4,207,561
Current liabilities 1,093,573 251,156 270,215
Noncurrent liabilities 2,406,291 431,859 2,541,277
Equity 1,434,164 55,163 1,396,069
Total liabilities and equity 4,934,028 738,178 4,207,561
Net revenue 2,584,514 254,392 163,820
Cost of services rendered (1,286,609) (124,927) (91,764)
Gross profit 1,297,905 129,465 72,056
Operating income (expenses) (144,068) (183,662) (396,068)
Equity pickup - - 750,819
Operating income/loss before financial income (expenses) 1,153,837 (54,197) 426,807
Financial income (expenses) (298,181) (57,272) (198,327)
Operating income/loss before taxes 855,656 (111,469) 228,480
Income and social contribution taxes (277,782) (206,568) 4,406
Net income/loss for the year 577,874 (318,037) 232,886
Income (loss) from discontinued operations - - (689,301)
P&L for the year 577,874 (318,307) (456,415)
Attributable to:
Company 562,386 (318,307) (456,415)
OTHER SHAREHOLDERS 15,488 - -
SUSTAINABILITY REPORT 2016 91
FINANCIAL STATEMENTS
ACCOUNTS CONCESSIONS PORTSHOLDING AND
SERVICES
Current assets 680,092 59,949 389,659
Noncurrent assets 3,976,636 918,789 4,071,385
Total assets 4,656,728 978,738 4,461,044
Current liabilities 1,068,522 201,649 279,595
Noncurrent liabilities 2,331,889 606,557 1,727,390
Equity 1,256,317 170,532 2,454,059
Total liabilities and equity 4,656,728 978,738 4,461,044
Net revenue 2,434,280 313,056 200,448
Cost of services rendered (1,282,336) (187,852) (107,721)
Gross profit 1,151,944 125,204 92,727
Operating income (expenses) (151,914) (155,292) (79,684)
Equity pickup - - 668,085
Operating income/loss before financial income (expenses) 1,000,030 (30,088) 681,128
Financial income (expenses) (352,777) (119,375) (191,046)
Operating income/loss before taxes 647,253 (149,463) 490,082
Income and social contribution taxes (207,988) 48,875 (89)
NET INCOME/LOSS FOR THE YEAR 439,265 (100,588) 489,993
ECORODOVIAS92