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2Q17 Results 1
Release of the 2Q17 Results
The main operational and financial indicators were:
Steel sales volume of 990 thousand tons;
Iron ore sales volume of 629 thousand tons;
Adjusted consolidated EBITDA of R$750 million and Adjusted EBITDA margin of 29%;
Working capital on 06/30/17 of R$3.1 billion;
Cash position on 06/30/17 of R$2.0 billion;
Investments of R$34 million.
BM&FBOVESPA: USIM5 R$ 4.57/share USIM3 R$8.83/share
USA/OTC: USNZY US$1.35/ADR
LATIBEX: XUSI €1.11/share XUSIO €2.39/share
Market Data – 06/30/17 Index
• Consolidated Results
• Performance of the Business Units: - Siderurgia - Mining - Steel - Steel Processing - Capital Goods
• Highlights
• Capital Markets
• Balance Sheet, Income and Cash Flow Statements
Public Disclosure - Belo Horizonte, July 28, 2017. Usinas Siderúrgicas de Minas Gerais S.A. - Usiminas (B3: USIM3, USIM5 e USIM6; OTC: USDMY and USNZY; LATIBEX: XUSIO and XUSI) today releases its second quarter (2Q17) results. Operational and financial information of the Company, except where otherwise stated, are presented based on consolidated figures, in Brazilian Real, according to International Financial Reporting Standards (IFRS). All comparisons made in this release take into consideration the first quarter of 2017 (1Q17), unless stated otherwise.
3T11
R$ million - Consolidated 2Q17 1Q17 2Q16Chg.
2Q17/1Q171H17 1H16
Chg.
1H17/1H16
Steel Sales Volume (000 t) 990 930 899 6% 1,919 1,802 7%
Iron Ore Sales Volume (000 t) 629 643 787 -2% 1,272 1,761 -28%
Net Revenue 2,569 2,351 2,028 9% 4,920 4,069 21%
COGS (2,187) (1,870) (2,025) 17% (4,057) (4,107) -1%
Gross Profit (Loss) 382 481 3 -20% 863 (38) -
Net Income (Loss) 176 108 (123) 62% 284 (275) -
EBITDA (Instruction CVM 527) 711 528 61 35% 1,239 110 1022%
EBITDA Margin (Instruction CVM 527) 28% 23% 3% + 5.2 p.p. 25% 3% + 22 p.p.
Adjusted EBITDA 750 533 68 41% 1,283 119 975%
Adjusted EBITDA Margin 29% 23% 3% + 6.5 p.p. 26% 3% + 23 p.p.
Investments (CAPEX) 34 23 50 46% 57 121 -53%
Cash Position 1,951 2,416 2,713 -19% 1,951 2,713 -28%
Highlights
2Q17 Results 2
Economic Outlook
The good pace of economic activity and maintenance of the confidence levels over the 2Q17
sustained the more optimistic forecasts for the global economy in 2017. The International
Monetary Fund raised its forecast to 3.5% growth in the year. Domestically, the disclosure of
the GDP in the 1Q17 put an end to the sequence of eight negative results, confirming the
perception that economic growth is beginning to recover from the crisis initiated in the second
quarter of 2014. Nevertheless, the worsening of the political crisis in mid May increased the
risks of recovery occurring more slowly.
Also, political instability has delayed the processing of the reforms, increasing uncertainty
about the perspective of stabilization of the public debt. In spite of this, the dollar appreciated
only moderately, with the average quotation increasing from R$3.15/US$ in the 1Q17 to
R$3.21/US$ in the 2Q17. Inflation continued to fall more quickly than expected, reaching 3.0%
cumulatively in the first half of 2017. This has fed the expectation of maintenance of the pace
of the benchmark interest rate - Selic cut in the coming meetings of the Copom. According to
the Focus Report of Banco Central do Brasil (06/30/17), the expectation is that interest will fall
to 8.5%/yr by the end of 2017.
Brazilian industry has begun to show the first signs of a recovery. With available data through
May, Industrial Production (IBGE) has increased 0.5% in the five-month comparison of this
year with the same period in 2016. Industrial sectors with steel intensive consumption had
even more significant gains. Capital goods production increased 3.5% and durable goods,
11.0%. In June, industrial business remained confident, however, there was a reduction in the
Confidence Index between May and June, impacted by the worsening of the political crisis.
2Q17 Results 3
Economic and Financial Performance
Comments on the Consolidated Results
Net Revenue
Net revenue in the 2Q17 was R$2.6 billion, against R$2.4 billion in the 1Q17, a 9.3% increase,
due to greater sales volume and higher prices in the Steel and Steel Processing Units.
Cost of Goods Sold - COGS
COGS in the 2Q17 totaled R$2.2 billion, against R$ 1.9 billion in the 1Q17. For detailed
information, see the Business Unit sections of this release. In the 2Q17, gross margin was
14.9%, against 20.4% in the 1Q17, shown below.
Operating Expense and Income
In the 2Q17, sales expenses were R$65.6 million, against R$52.2 million in the 1Q17, a 25.7%
increase, mainly due to higher provisions for doubtful accounts, which totaled R$16.3 million in
the 2Q17, against R$3.9 million in the 1Q17.
General and administrative expenses in the 2Q17 totaled R$96.6 million, against R$93.1
million in the 1Q17, mainly due to the increase of 7.6% in expenses with in-house and third
party labor.
Other operating expenses and income accounted income of R$146,7 million in the 2Q17,
against expense of R$150.7 in the 1Q17, mainly due to:
Recognition of R$201,1 million (net of expenses) from the agreement with Porto
Sudeste in the 2T17. There wasn’t that effect in the 1T17;
Higher result in the sale of surplus electrical energy, which accounted a gain of R$18.7
million in the 2Q17, against a loss of R$22.7 million in the 1Q17;
Lower expenses with provision for contingencies, which were R$13,8 million in the
2Q17, against R$49.9 million in the 1Q17;
Higher tax credits by R$23.1 million in the 2Q17;
Higher result of the Reintegra Program, which was R$6.6 million in the 2Q17, against
R$4.5 million in the 1Q17.
Thus, operating expenses and income were R$15,6 million in the 2Q17, against R$296.1
million in the 1Q17.
In this manner, the Company’s operating margin showed the following performance:
2Q17 1Q17 2Q16 1H17 1H16
Domestic Market 86% 90% 89% 88% 87%
Exports 14% 10% 11% 12% 13%
Total 100% 100% 100% 100% 100%
Net Revenue Breakdown
2Q17 1Q17 2Q16 1H17 1H16
14.9% 20.4% 0.1% 17.5% -0.9%
Gross Margin
2Q17 1Q17 2Q16 1H17 1H16
14.2% 7.8% -14.4% 11.1% -15.0%
EBIT Margin
2Q17 Results 4
Adjusted EBITDA
Adjusted EBITDA is calculated from net income (loss), reversing income tax and social
contribution, financial result, depreciation, amortization and depletion, and equity in the results
of Associate, Joint Subsidiary and Subsidiary Companies, not including impairment of assets.
The adjusted EBITDA includes the proportional participation of 70% of Unigal and other joint
subsidiary companies.
Adjusted EBITDA was R$749,9 million in the 2Q17, against R$532.8 million in the 1Q17, mainly
due to the R$201,1 million recognition from the agreement with Porto Sudeste and the better
performance in the Steel Unit.
It’s worth to highlight that even without the amount received by the Mineração Usiminas, the
EBITDA would have totaled R$550,8 million, the best result in 13 quarters.
For more information, see the Business Unit sections of this release.
Adjusted EBITDA margin in the 2Q17 was 21.4%, against 22.7% in the 1Q17, as shown below:
Financial Result
In the 2Q17, financial results accounted expenses of R$171.3 million, against expenses of
R$54.6 million in the 1Q17, mainly due to exchange variation losses of R$77.2 million in the
2Q17, against gains of R$55.6 million in the 1Q17, due to depreciation of the Real against the
Dollar of 4.4% in the 2Q17, against appreciation of 2.8% in the 1Q17. That effects were partially
compensated by lower interest on loans due to a reduction in the interest rates.
R$ thousand 2Q17 1Q17 2Q16Change
2Q17/1Q171H17 1H16
Change
1H17/1H16
Net Currency Exchange Variation (77,169) 55,617 328,090 - (21,552) 675,047 -
Swap Transactions Market Cap. (701) 1,299 (165,904) - 598 (294,955) -
Interest on Financial Asset and Monetary Effects 109,324 102,626 115,983 7% 211,950 172,163 23%
Other Financial Income 47,108 56,525 63,393 -17% 103,633 113,425 -9%
Interest and Monetary Effects over Financing and Taxes Payable in
Installments (194,799) (218,796) (166,918) -11% (413,595) (343,831) 20%
Other Financial Expenses (55,057) (51,852) (60,023) 6% (106,909) (105,675) 1%
FINANCIAL RESULT (171,294) (54,581) 114,621 214% (225,875) 216,174 -
+ Appreciation / - Depreciation of Exchange Rate (R$/US$) -4.4% 2.8% 9.8% - 7.2 p.p. -1.5% 17.8% - 19.3 p.p.
Financial Result - Consolidated
2Q17 1Q17 2Q16 1H17 1H16
29.2% 22.7% 3.3% 26.1% 2.9%
Adjusted EBITDA Margin
2Q17 1Q17 2Q16 1H17 1H16
Net Income (Loss) 175,710 108,318 (123,357) 284,028 (274,734)
Income Tax / Social Contribution 34,922 58,855 (18,675) 93,777 (34,035)
Financial Result 171,294 54,581 (114,621) 225,875 (216,174)
Depreciation, Amortization 328,601 306,341 317,273 634,942 635,359
710,527 528,095 60,620 1,238,622 110,416
Joint Subsidiary Companies proportional EBITDA 54,603 41,754 44,212 96,357 89,809
Impairment of Assets - - (393) - 7,637
749,852 532,769 67,784 1,282,621 119,362 Adjusted EBITDA
Consolidated (R$ thousand)
Equity in the Results of Associate and Subsidiary
Companies(15,278) (37,080)
EBITDA - Instruction CVM - 527
(52,358) (88,500)
EBITDA Breakdown
(36,655)
2Q17 Results 5
31-Mar-17 30-Jun-16
Short Term Long Term TOTAL TOTAL TOTAL
Local Currency 35,523 5,107,507 5,143,030 74% 5,161,235 0% 4,201,719 22%
TJLP 1,901 375,514 377,415 - 378,799 0% 380,318 -1%
CDI 22,256 4,700,707 4,722,963 - 4,731,318 0% 3,618,234 31%
Others 11,366 31,286 42,652 - 51,118 -17% 203,167 -79%
Foreign Currency* 594,953 1,211,669 1,806,622 26% 1,718,079 5% 3,035,945 -40%
Gross Debt 630,476 6,319,176 6,949,652 100% 6,879,314 1% 7,237,664 -4%
Cash and Cash Equivalents - - 1,951,286 - 2,415,637 -19% 2,712,903 -28%
Net Debt - - 4,998,366 - 4,463,677 12% 4,524,761 10%
(*)99.8% of total foreign currency is US dollars denominated
Total Indebtedness by Index - Consolidated
R$ thousand30-Jun-17
%Change
Jun17/Mar17
Change
Jun17/Jun16
Equity in the Results
Equity in the results of affiliates and jointly-controlled companies was R$15.3 million in the 2Q17,
against R$37.1 million in the 1Q17, mainly due to the recognition of a negative result of Codeme
in the 2Q17, partially compensated by better results in MRS Logística and Unigal.
Net Profit (Loss)
The Company accounted a net profit of R$175,7 million in the 2Q17, against R$108.3 million in
the 1Q17, mainly because of the R$132,2 million net of expenses recognition from the
agreement with Porto Sudeste (MUSA), partially compensated by the negative exchange effects
in the period.
Working Capital
In the 2Q17, working capital was R$3.1 billion, against R$2.6 billion in the 1Q17, a R$470 million
increase, mainly due to:
the decrease of the open balance of Payables by R$245 million, mostly related to slab
purchase from third party;
the increase of the Other Assets by R$171 million, in function of the recognition of R$201
million to be received by Mineração Usiminas (Porto Sudeste Agreement), partially
compensated by the reduction on tax recoverable by R$40 million;
the increase in Accounts Receivable by R$160 million, due higher prices in the period,
highlighting that there were no increase in the average debt maturity payment time.
Investments (CAPEX)
In the 2Q17, CAPEX totaled R$34.1 million, 45.8% higher when compared to the 1Q17, which
was R$23.4 million. Investments were applied in sustaining CAPEX, with approximately 75% in
the Steel Unit, 14% in the Mining Unit, 7% in the Steel Processing Unit and 4% in the Capital
Goods Unit.
Indebtedness
On 06/30/17, gross consolidated debt was R$6.95 billion, stable when compared to that on
03/31/17, which was R$6.88 billion. In the 2Q17, there was depreciation of the Real against
the Dollar of 4.4%, which negatively impacted the Dollar debt portion, which on the date
corresponded to 26% of total debt. Debt composition by maturity was 9.1% short term and
90.9% long term.
Net consolidated debt on 06/30/17 was R$5.0 billion, against R$4.5 billion on 03/31/17. The
Net debt/EBITDA ratio ended the 2Q17 at 2,8x, against 3.9x in the 1Q17.
The following chart demonstrates the consolidated debt indexes:
2Q17 Results 6
The graph below demonstrates the cash position and debt profile (principal only) in millions of
Real on 06/30/17:
Debt renegotiation/ Comments:
Reduction in the Capital of Mineração Usiminas – MUSA: On 03/03/17, the General
Extraordinary Shareholders’ Meeting unanimously approved the reduction in the capital of
MUSA in the amount of R$1.0 billion, of which R$700 million was delivered to the Company on
05/19/17, proportional to its stake in the Musa’s capital.
Waiver of the Exchange of 2018 Notes: On 06/30/17, Usiminas obtained a waiver from the
Brazilian private banks and the Brazilian Economic and Social Development Bank (Banco
Nacional de Desenvolvimento Econômico e Social), pursuant to which Usiminas is exempted
from its obligation to carry out an exchange offer for the notes due in 2018 issued by its
subsidiary Usiminas Commercial Ltd., but which effectiveness will be terminated in the event
that Usiminas fails to obtain a similar, permanent waiver from the Japanese Banks and the
Debenture Holders (in each case, as defined in the Material Fact press releases of September 9
and 12, 2016).
The Japanese Banks and the Debenture Holders, in turn, have granted an extension of the
deadline for Usiminas to carry out the Exchange Offer until August 31, 2017, in order to allow
for their review of a permanent waiver of the obligation to carry out the Exchange Offer.
1,747
6 16 78
333
608
874 875 875 874
648
204
0
572 15
76
143
207 207 207 207
156
1,951
6
588
94
409
751
1,082 1,082 1,082 1,082
804
Cash 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026
Local Currency Foreign Currency
Duration: R$: 53 months
US$: 48 months
2Q17 Results 7
Performance of the Business Units
Intercompany transactions are on arm’s-length basis (market prices and conditions) and sales
between Business Units are carried out as sales between independent parties.
R$ million
1H17 1H16 1H17 1H16 1H17 1H16 1H17 1H16 1H17 1H16 1H17 1H16
Net Revenue 197 207 4,676 3,517 1,157 863 163 325 (1,273) (843) 4,920 4,069
Domestic Market 197 133 4,078 3,046 1,156 862 162 325 (1,273) (843) 4,321 3,524
Exports - 74 598 471 - 1 1 - - - 599 546
COGS (106) (186) (3,909) (3,567) (1,061) (808) (157) (293) 1,175 746 (4,057) (4,107)
Gross Profit (Loss) 91 22 768 (50) 96 55 6 32 (98) (97) 863 (38)
Operating Income (Expenses) 109 (92) (351) (408) (48) (52) (24) (26) 2 3 (312) (576)
EBIT 200 (70) 417 (458) 48 3 (18) 6 (96) (94) 551 (613)
Adjusted EBITDA 277 9 963 96 64 17 (6) 18 (16) (21) 1,283 119
Adj.EBITDA Margin 140% 4% 21% 3% 6% 2% -4% 6% 1% 2% 26% 3%
*Consolidated 70% of Unigal
Income Statement per Business Units - Non Audited - Semi-annually
Mining Steel* Steel Processing ConsolidatedCapital Goods Adjustment
Mining Steel Steel Processing Capital Goods
Mineração Usiminas Ipatinga Mill Soluções Usiminas Usiminas Mecânica
Cubatão Mill
Unigal
Usiminas - Business Units
R$ million
2Q17 1Q17 2Q17 1Q17 2Q17 1Q17 2Q17 1Q17 2Q17 1Q17 2Q17 1Q17
Net Revenue 89 108 2,458 2,219 590 567 80 83 (647) (626) 2,569 2,351
Domestic Market 89 108 2,100 1,978 589 567 80 82 (647) (626) 2,212 2,110
Exports - - 358 240 - - - 1 - - 358 241
COGS (53) (53) (2,111) (1,798) (548) (512) (75) (82) 600 575 (2,187) (1,870)
Gross Profit (Loss) 36 55 347 421 41 55 5 1 (47) (51) 382 481
Operating Income (Expenses) 151 (42) (133) (218) (22) (26) (13) (11) 1 1 (16) (296)
EBIT 187 13 214 203 19 29 (8) (10) (46) (50) 367 185
Adjusted EBITDA 226 52 498 465 27 37 (2) (4) 211 (16) 750 533
Adj.EBITDA Margin 253% 48% 20% 21% 5% 7% -2% -5% 0% 3% 29% 23%
*Consolidated 70% of Unigal
Income Statement per Business Units - Non Audited - Quarterly
Mining ConsolidatedAdjustmentCapital GoodsSteel
ProcessingSteel*
2Q17 Results 8
I) M I N I N G
In the 2Q17, iron ore prices decreased significantly in the international market, reduction of
approximately 26% in comparison with the 1Q17, with a quarterly average price of US$62.98/t.
The already expected increase in the supply of Australian ore, allied to India’s increment in
exports, due to its reduction of the export tax, and greater availability of Chinese iron ore
concentrates, (which resumed production due to the high prices of the previous two quarters),
decisively contributed to this prices behavior. On the consumption side, continued good financial
results obtained by Chinese steel also helped to maintain the demand for iron ore, even with the
inventories in Chinese ports having reached a historical peak in the period, arriving at 145 million
tons.
In terms of outlook, the optimism observed in the 1Q17 has cooled off, with prices undergoing
natural correction due to the supply situation versus demand presented. Additionally, most of the
steel plants have looked for better quality ores, seeking to improve productivity and reduce cost, in
view of the good prices observed in the steel market.
Operational and Sales Performance - Mining
In the 2Q17, production volume was 689 thousand tons, stable when compared to 1Q17, which
was 681 thousand tons. Sales volume accounted in the 2Q17 was 629 thousand tons, against 643
thousand tons in the 1Q17, basically to the Steel Business Unit.
Production and sales volume are shown in the table below:
Comments on the Business Unit Results - Mining
In the 2Q17, net revenue accounted was R$89.1 million, against R$108.3 million in the 1Q17, a
17.7% decrease, due to a 8.5% decline in the PLATTS iron ore price (62% Fe, CFR China),
adjusted for the period of sales price formation of Mineração Usiminas (US$75.6/t in the 2Q17,
against US$82.5/t in the 1Q17), by a 2.2% decrease in sales volume and by the average
appreciation of 2.2% of the Real against the Dollar in the period of reference for invoicing.
In the 2Q17, cash cost per ton was R$73.2/t, against R$61.8/t in the 1Q17, an 18.4% increase,
mainly due to the restarting of operations of two plants (Flotation and Eastern Mine), basically with
maintenance, contracting and training of personnel. In the 2Q17, Cost of Goods Sold (COGS) was
R$53.2 million, against R$53.0 million in the 1Q17. COGS per ton was R$84.0/t, against R$82.0/t
in the 1Q17, a 2.4% increase, mainly due to provisions for profits and results sharing (PRS).
In the 2Q17, net operating expenses were R$151,0 million positive, against R$42.5 million
negative in the 1Q17, an increase of R$193,4 million, mainly due to the recognition of R$201,1
million net of expenses from the Porto Sudeste Agreement, partially compensated by pre-
operating expenses, for the restarting of operations of two plants, which were re-classified as
operating expenses. Additionally, in the 2Q17, the result with the sales of surplus electrical energy
was R$0.4 million, against R$0.1 million in the 2Q17.
Thus, in the 2Q17, Adjusted EBITDA was R$225,8 million, against R$51.5 million in the 1Q17, a
338,3% increase. Adjusted EBITDA margin was 253,4% in the 2Q17, against 47.6% in the 1Q17.
Thousand tons 2Q17 1Q17 2Q16Change
2Q17/1Q171H17 1H16
Chg.
1H17/1H16
Production 689 681 691 1% 1,370 1,392 -2%
Sales - Third Parties - Domestic Market 33 28 17 18% 61 33 85%
Sales - Exports 0 0 177 - 0 521 -
Sales to Usiminas 596 615 593 -3% 1,211 1,207 0%
Total Sales 629 643 787 -2% 1,272 1,761 -28%
Iron Ore
2Q17 Results 9
Investments (CAPEX)
Investments in the 2Q17 were R$4.7 million, against R$2.6 million in the 1Q17, mainly applied
to sustaining CAPEX.
Agreement with Porto Sudeste
On 05/27/15, Mineração Usiminas notified Porto Sudeste do Brasil S.A. (presently named MMX
Porto Sudeste Ltda.) about the immediate rescission of the service contract of port operation
receiving, handling, stocking and shipment of ore belonging to Mineração Usiminas at the Porto
Sudeste Terminal in the Take or Pay and Delivery or Pay modalities by reason of constant non-
performance on the part of Porto Sudeste, of its obligation to conclude and put into operation,
as well as by the non-payment of contractual fines. The Company took the necessary
measures to safeguard its rights, including an arbitration process, claiming payment of the
fines, reimbursement of opportunity costs, in addition to damages foreseen by contract. The
aforementioned contract was signed with a five-year term in effect as of the first shipment,
initially forecast for April 2012.
On 06/06/17, Mineração Usiminas signed an agreement with Porto Sudeste to end the
arbitration process, resulting in the cancellation of the aforementioned contract and the waiver
of all rights that both parties could still retain in relation to the contract. On the same date, a
new contract was also signed for port operation services, which provides that Mineração
Usiminas will have the right, but not the obligation, to move a total volume of up to 17.5
million tons of iron ore per year through the port terminal of Porto Sudeste, located in the
municipality of Itaguaí, RJ. Porto Sudeste paid R$205.1 million to Mineração Usiminas on
07/12/17.
Stake in MRS Logística
Mineração Usiminas holds a stake in the MRS Logística through its subsidiary UPL – Usiminas
Participações e Logística S.A.
MRS Logística is a concession that controls, operates and monitors the Brazilian Southeastern
Federal Railroad Network (Malha Sudeste da Rede Ferroviária Federal). The company operates
in the cargo railway transportation segment, connecting the states of Rio de Janeiro, Minas
Gerais and São Paulo, and its core business is transporting, with integrated logistics, general
cargo, such as iron ore, finished steel products, cement, bauxite, agricultural products, pet
coke and containers.
MRS transported 44 million tons in the 2Q17, volume 10.7% growth in relation to the 1Q17,
resulting mainly from seasonality of the periods.
2Q17 Results
10
II) S T E E L
Preliminary figures from the World Steel Association show a crude steel production of 836
million tons in the first six months of 2017, a 4.5% growth over the same period in the
previous year. There was growth in practically all the main producing countries, and the
greater contribution came from China, which registered volume of 419,7 million tons, 4.6%
higher when compared to the same period of 2016. Steel consumption in that country has
responded to stimuli through infrastructure spending and should once again grow in 2017,
according to the forecast from World Steel Dynamics. Chinese exports, increasingly restricted
due to the imposition of trade restrictions, were reduced when compared to 2016.
The Chinese government announced the cut of around 40 million tons of crude steel production
capacity in 2017. This is equivalent to around 85% of the annual goal, which foresees closing
of 50 million tons of capacity. Global aversion to investments has made a stronger demand
recovery more difficult, thus maintaining the situation of global overcapacity practically
unchanged.
In Brazil, according to data from the Brazilian Steel Institute (IABr), crude steel production
reached 16.7 million tons, a 12.4% increase in the first six months of 2017, with a highlight for
the increase in flat rolled steel, which grew 17.0%. In the period, domestic apparent steel
consumption of flat steel products was 5.0 million, a 12.9% increase over the same period in
2016.
Production - Ipatinga and Cubatão Plants
Crude steel production was 769 thousand tons in the 2Q17, against 737 thousand tons in the
1Q17. In the 2Q17, rolled production in the Ipatinga and Cubatão plants totaled 1.0 million
tons, 3.6% higher over the 1Q17, which was 965 thousand tons.
Sales
In the 2Q17, total sales were 990 thousand tons, against 930 thousand tons in the 1Q17. In the
domestic market, sales volume was 840 thousand tons in the 2Q17, a 2% growth in relation to
the 1Q17, which was 825 thousand tons. Export sales were 149 thousand tons in the 2Q17,
against 105 thousand tons in the 1Q17, a 43% increase.
In the 2Q17, the sales in the domestic market was 85% and 15% in the exports. The progress of
the sales volume is shown below:
Thousand tons 2Q17 1Q17 2Q16Change
2Q17/1Q171H17 1H16
Chg.
1H17/1H16
Total Crude Steel769 737 776 4% 1,506 1,570 -4%
Total Rolled Steel 1,000 965 819 4% 1,965 1,699 16%
Production of Crude and Rolled Steel
784 814 821 825 840
115145 71 105 150
899 959
891 930 990
2Q16 3Q16 4Q16 1Q17 2Q17
Domestic Market Exports
2Q17 Results
11
The main export destinations are as follows:
Comments on the Business Unit Results – Steel
Net revenue in the Steel Unit was R$2.5 billion in the 2Q17, 10.8% higher when compared to
the 1Q17, which was R$2.2 billion, due price increases by 4.1% in the domestic market and
5.6% in the export market, in addition to higher export volume by 42%.
In the 2Q17, cash cost per ton of slabs was R$1,727/t, against R$1,614/t in the 1Q17, a 7.0%
increase comparing the periods, mainly due to higher costs (coal by 16.2%, purchased slab by
13.8%, labor by 12% and energy and fuel by 3.1%, in addition to an average exchange
depreciation of 2.3%).
Cost of Goods Sold (COGS) was R$2.1 billion in the 2Q17, against R$1.8 billion in the 1Q17.
COGS-per-ton was R$2,133/t in the 2Q17, against R$1,933/t in the 1Q17, mainly due to higher
cost of flat products sold as a consequence of higher raw materials prices (coal, ore and slab),
observed in 2017. Additionally, higher amount of value-added products were sold, with a
highlight for galvanized products.
Sales expenses were R$47.0 million in the 2Q17, 46.9% higher to those in the 1Q17, which
were R$32.0 million, mainly due to higher provision for doubtful accounts, which were R$14.1
million in the 2Q17, against a reversal of the provision of R$1.0 million in the 1Q17.
Thousand tons Change
2Q17/1Q17
Change
1H17/1H16
Total Sales 990 100% 930 100% 899 100% 6% 1,919 100% 1,802 100% 7%
Heavy Plates 126 13% 112 12% 109 12% 13% 239 13% 254 14% -6%
Hot Rolled 288 29% 266 29% 240 27% 9% 554 29% 500 28% 11%
Cold Rolled 308 31% 297 32% 277 31% 4% 604 31% 516 29% 17%
Galvanized 257 26% 232 25% 251 28% 11% 489 25% 481 27% 2%
Slabs 10 1% 23 2% 20 2% -56% 33 2% 50 3% -34%
Domestic Market 840 85% 825 89% 783 87% 2% 1,666 87% 1,540 86% 8%
Heavy Plates 118 14% 107 13% 102 13% 9% 225 13% 237 15% -5%
Hot Rolled 273 33% 256 31% 219 28% 6% 529 32% 439 28% 21%
Cold Rolled 238 28% 242 29% 236 30% -2% 480 29% 441 29% 9%
Galvanized 202 24% 200 24% 205 26% 1% 402 24% 384 25% 5%
Slabs 10 1% 20 3% 20 3% -48% 30 2% 40 3% -25%
Exports 149 15% 105 11% 115 13% 43% 254 13% 261 14% -3%
Heavy Plates 9 6% 5 5% 7 6% 82% 14 5% 17 7% -20%
Hot Rolled 16 10% 10 9% 21 18% 66% 25 10% 61 23% -59%
Cold Rolled 70 47% 54 52% 41 35% 28% 124 49% 75 29% 65%
Galvanized 55 37% 32 31% 47 41% 69% 87 34% 97 37% -11%
Slabs 0 0% 3 3% - 0% - 3 1% 10 4% -67%
Sales Volume Breakdown
1H17 1H161Q172Q17 2Q16
2Q17 Results
12
General and administrative expenses totaled R$72.1 million in the 2Q17, stable when
compared to the 1Q17, which were R$71.5 million.
Other operating expenses and income totaled R$13.7 million in the 2Q17, against R$114.3
million in the 1Q17, an 88.0% decrease, due to:
Higher result in the sale of surplus electrical energy in the 2Q17, which accounted a
gain of R$18.3 million, against an loss of R$22.8 million in the 1Q17;
Lower provisions for contingencies by R$41.6 million;
Higher tax credits by R$23.1 million in the 2Q17;
Higher revenue with the Reintegra Program, which R$6.6 million in the 2Q17, against
R$4.5 million in the 1Q17.
Thus, operating expenses and revenues totaled R$132.8 million in the 2Q17, against R$217.8
million in the 1Q17.
Adjusted EBITDA reached R$498.0 million in the 2Q17, against R$464.9 million in the 1Q17.
Adjusted EBITDA margin was 20.3% in the 2Q17, against 21.1% in the 1Q17, a 80 basis points
decrease.
Investments (CAPEX)
In the 2Q17, investments totaled R$25.5 million, against R$18.0 million in the 1Q17, applied to
sustaining CAPEX.
2Q17 Results
13
III) S T E E L P R O C E S S I N G
Soluções Usiminas – SU
Soluções Usiminas operates in the distribution, services and small-diameter tubes’ markets
nationwide, offering its customers high value-added products. It serves several economic
segments, such as automotive, auto parts, civil construction, distribution, electro-electronics,
machinery and equipment and household appliances, among others.
In the 2Q17, sales in the Distribution, Services/Just-in-Time and Tubes segments were
responsible for 36%, 55% and 9% of total sales volume.
Comments on the Business Unit Results – Steel Processing
In the 2Q17, net revenue was R$589.7 million, 4.0% greater in comparison with the 1Q17,
which was R$567.0 million, due to higher product sales and services volume by 1.2%, as well as
higher average price in the period by 2.8% in function of a better product mix sold in the 2Q17.
Cost of goods sold in the 2Q17 was R$548.5 million, against R$512.1 million in the 1Q17, a
7.1% increase due to higher sales volume and better product sales mix sold in the period.
Operating expenses were R$21.9 million in the 2Q17, against R$26.1 million in the 1Q17, a
16.2% decrease, mainly due to reversal or reduction of provisions, such as doubtful accounts
and contingencies.
Thus, Adjusted EBITDA in the 2Q17 was R$27.3 million, against R$36.9 million in the 1Q17, a
R$9.6 million decrease. Adjusted EBITDA margin was 4.6% in the 2Q17, against 6.5% in the
1Q17, a 190 basis points decrease.
IV) C A P I T A L G O O D S
Usiminas Mecânica S.A.
Usiminas Mecânica is a Brazilian capital goods company dedicated to the fabrication and
assembly of metallic structures, shipbuilding and offshore platforms, oil and gas, industrial
assembly and equipment fabrication, foundry and railcar manufacture.
Main Contracts
In the 2Q17, the main contracts were with the oil and gas industry, bridges and industrial
equipment.
Comments on the Business Unit Results – Capital Goods
In the 2Q17, net revenue was R$80.4 million, 2.7% lower than in the 1Q17, which was R$82.7
million, due to the decrease in the portfolio as consequence of the stagnation in infrastructure
projects in the country.
Gross profit was R$5.3 million in the 2Q17, against R$0.5 million in the 1Q17, an increase of
R$4.7 million, due to better results obtained in the industrial equipment segment.
Adjusted EBITDA in the 2Q17 was a negative R$1.6 million, against a negative R$4.2 million in
the 1Q17, result of better margins in the industrial equipment segment and the reduction of
fixed cost in the period. Adjusted EBITDA margin in the 2Q17 was a negative 2.0%, against a
negative 5.0% in the 1Q17, an improvement of 300 basis points.
2Q17 Results
14
Highlights
BVC Audit for Certification of IATF 16.949:2016 (Automotive Sector) and
Maintenance of ISO 9001:2015:
The audit was successfully concluded: The Company will soon receive the new certificate,
which will place it once more as a pioneer in certifications for excellence in customer services.
The Usiminas certification project in the new standard, which involved several areas in
Ipatinga, Cubatão, Belo Horizonte, Distribution Centers, Port and São Paulo, was led by the
Quality Assurance Team, with fundamental participation of Usiminas Quality Engineers and
Auditors.
Usiminas Sustainability Program “Paths of the Valley” receives award at FIEMG
event:
The initiative of the Minas Gerais Industrial Federation (FIEMG) and the State Environmental
Foundation (FEAM) encourages and discloses development of projects aiming at eco-efficiency
in production processes, with the less intensive use of natural resources and lower
environmental degradation.
Usiminas is a finalist in the REI Award (Recognition of Excellence and Innovation), in
the Inputs Category:
Usiminas was one of the finalists in the Inputs category, with development of the Dual Phase
1200 steel grade, an award promoted by the Automotive Business magazine.
Usiminas is awarded by Honda Motorcycles in the category “Excellence in Quality and
Delivery”:
During the Annual Suppliers Meeting held on May 5th, Usiminas was awarded by Honda
Motorcycles in the category “Excellence in Quality and Delivery”. Usiminas has a long standing
partnership with Honda do Brasil and, currently, suppliers six steel grades to the motorcycle
segment coming from the Ipatinga and Cubatão plant for use in tubes of the motorcycles
produced by the manufacturer.
Usiminas is awarded as best raw materials supplier of Fiat Chrysler Automobiles:
Usiminas was awarded as best raw materials supplier of Fiat Chrysler Automobiles (FCA)
during the Annual Supplier Conference & Awards ceremony of the auto maker, held in Belo
Horizonte at the end of May. The winners of the 16 categories were chosen based on the
evaluation of performance indicators of the last year in the areas of quality, delivery, cost,
guarantee and partnership.
Usiminas wins the Excellence Award in Quality at Gestamp Automotive, one of the
main companies in the auto parts segment:
Usiminas was one of the winners with the “Award for Excellence in Quality” by the performance
shown over the last year. The company was evaluated by indicators, such as service (sales and
technical assistance), material performance, delivery and quality audits. During the entire
award period, Usiminas obtained a GQI (General Quality Indicator) above 95%.
Soluções Usiminas wins unprecedented award from Honda:
Soluções Usiminas is the first steel service center awarded by Honda in almost two decades of
the Annual Suppliers Meeting promoted by the Japanese manufacturer. The Company, a
subsidiary of Usiminas dedicated to steel processing and distribution, received the trophy in
the Business Highlight category, the main category in the automobile maker’s 19th edition of
the event.
2Q17 Results
15
Capital Markets
Performance on the BM&FBOVESPA
Usiminas’ common shares (USIM3) closed the 2Q17 quoted at R$8.83 and its preferred shares
(USIM5) at R$4.57. In the 2Q17, USIM3 and USIM5 appreciated 5.4% and 2.9%, respectively.
In the same period the Ibovespa presented a 3.2% depreciation.
Foreign Stock Markets OTC – New York
Usiminas has American Depositary Receipts (ADRs) traded on the over-the-counter market:
USDMY is backed by common shares and USNZY, by Class A preferred shares. On 06/30/17,
USNZY ADRs, which have higher liquidity, were quoted at US$1.35, presenting a depreciation
of 1.5% in the quarter.
LATIBEX – Madrid
Usiminas’ shares are traded on the LATIBEX – the Madrid Stock Exchange: XUSI as preferred
shares and XUSIO as common shares. On 6/30/17, XUSI closed quoted at €1.11, depreciating
15.1% in the quarter. XUSIO shares closed quoted at €2.39, registering a depreciation of 4.0%
in the quarter.
2Q17 1Q17Change
2Q17/1Q172Q16
Change
2Q17/2Q16
Number of Deals 583,002 692,202 -16% 738,205 -21%
Daily Average 9,557 11,165 -14% 11,718 -18%
Traded - thousand shares 894,325 1,010,930 -12% 1,741,154 -49%
Daily Average 14,661 16,305 -10% 27,637 -47%
Financial Volume - R$ million 3,675 4,872 -25% 3,665 0%
Daily Average 60 79 -23% 58 4%
Maximum 4.62 5.62 -18% 2.60 78%
Minimum 3.60 3.91 -8% 1.45 148%
Closing 4.57 4.46 2% 1.97 132%
Market Capitalization - R$ million 5,727 5,589 2% 1,997 187%
Usiminas Performance Summary - BM&FBOVESPA (USIM5)
2Q17 Results
16
For further information:
GERÊNCIA DE RELAÇÕES COM INVESTIDORES/INVESTOR RELATIONS MANAGER
Leonardo Karam Rosa leonardo.rosa@usiminas.com 31 3499-8550
Press: please contact through e-mail imprensa@usiminas.com
Visit the Investor Relations site at: www.usiminas.com/ri
or Access on your mobile phone: m.usiminas.com/ri
Statements contained in this release, relative to the business outlook of the Company, forecasts of operating and financial income and references to growth prospects are mere forecasts and were based on the expectations of Management in relation to future performance. These expectations are highly dependent on market conduct, the economic situation in Brazil, its industry and international markets and, therefore, are subject to change.
Brasília time: at 11:00 a.m.
Dial-in Numbers:
Brazil: (+55 11) 3193-1001 / 2820-4001
Pincode for replay: 8174621# - Portuguese
USA: (1 786) 924-6977
Pincode for replay: 9628194# - English
Audio of the conference call will be transmitted live via Internet
See the slide presentation on our website: www.usiminas.com/ri
2Q17 Conference Call Results - Date 07/28/2017
New York time: at 10:00 a.m.
Dial-in Numbers:
In Portuguese - Simultaneous Translation into English
Audio replay available at (55 11) 3193-1012 / 2820-4012
2Q17 Results
17
Assets 30-Jun-17 31-Mar-17 30-Jun-16
Current Assets 6,701,272 6,893,598 6,739,085
Cash and Cash Equivalents 1,951,286 2,415,637 2,712,903
Trade Accounts Receivable 1,265,246 1,173,118 1,233,438
Taxes Recoverable 265,572 291,519 284,585
Inventories 2,802,379 2,814,559 2,305,591
Advances to suppliers 9,058 6,617 8,709
Financial Instruments 89,497 68,652 58,746
Other Securities Receivables 318,234 123,496 135,113
Non-Current Assets 19,314,860 19,410,970 20,117,670
Long-Term Receivable 4,193,720 4,068,519 4,432,189
Deferred Income Tax & Social Contribution 3,061,289 3,040,718 3,361,515
Deposits at Law 700,388 667,712 625,730
Accounts Receiv. Affiliated Companies 3,302 3,623 4,300
Taxes Recoverable 106,763 96,074 83,011
Financial Instruments 373 748 170,670
Others 321,605 259,644 186,963
Investments 1,164,854 1,150,372 1,157,844
Property, Plant and Equipment 13,259,162 13,488,122 14,191,715
Intangible 697,124 703,957 335,922
Total Assets 26,016,132 26,304,568 26,856,755
Balance Sheet - Assets - Consolidated | IFRS - R$ thousand
30-Jun-17 31-Mar-17 30-Jun-16
2,281,035 2,458,976 5,843,359
Loans and Financing and Taxes Payable in Installments 630,476 609,555 3,075,907
Suppliers, Subcontractors and Freight 703,438 683,157 852,326
Wages and Social Charges 211,743 180,941 245,170
Taxes and Taxes Payables 126,256 123,035 108,447
Accounts Payable Forfaiting 327,442 606,752 478,837
Financial Instruments 92,199 71,225 119,314
Dividends Payable 22,000 22,003 140
Customers Advances 53,358 55,094 80,077
Others 114,123 107,214 883,141
8,464,035 8,445,852 6,303,747
Loans and Financing and Taxes Payable in Installments 6,319,176 6,269,759 4,161,757
Actuarial Liability 1,088,014 1,139,376 1,184,437
Provision for Legal Liabilities 679,478 665,078 539,918
Financial Instruments - - 44,838
Environmental Protection Provision 150,494 146,721 134,838
Others 226,873 224,918 237,959
15,271,062 15,399,740 14,709,649
Capital 13,200,295 13,200,295 12,200,295
Reserves & Revenues from Fiscal Year 640,458 524,131 916,997
Non-controlling shareholders participation 1,430,309 1,675,314 1,592,357
26,016,132 26,304,568 26,856,755
Long-Term Liabilities
Total Liabilities and Shareholders' Equity
Shareholders' Equity
Current Liabilities
Liabilities and Shareholders' Equity
Balance Sheet - Liabilities and Shareholders' Equity - Consolidated | IFRS - R$ thousand
2Q17 Results
18
R$ thousand 2Q17 1Q17 2Q16Change
2Q17/1Q17
Net Revenues 2,569,485 2,350,838 2,028,012 9%
Domestic Market 2,211,682 2,109,663 1,795,984 5%
Exports 357,803 241,175 232,028 48%
COGS (2,187,259) (1,870,099) (2,025,315) 17%
Gross Profit 382,226 480,739 2,697 -20%
Gross Margin 14.9% 20.4% 0.1% -5,5 p.p.
Operating Income (Expenses) (15,578) (296,065) (296,005) -95%
Selling Expenses (65,602) (52,193) (55,746) 26%
Provision for Doubtful Accounts (16,330) (3,923) (5,778) 316%
Other Selling Expenses (49,272) (48,270) (49,968) 2%
General and Administrative (96,644) (93,141) (86,152) 4%
Other Operating Income (expenses) 146,668 (150,731) (154,107) -197%
Reintegra Program 6,596 4,525 190 46%
Provision for Contingencies (13,839) (49,911) (3,579) -72%
Result of the Non Operating Asset Sale/Write-Off (586) 1,408 883 -
Result of the Sale of the Surplus Electric Energy 18,716 (22,701) (44,465) -
Temporary Equipments Shutdown (includes depreciation) (103,307) (105,241) (126,375) -2%
Impairment of Assets - - 393 -
Porto Sudeste Agreeement (net of expenses) 201,106 - - -
Tax credit on imports PIS/COFINS 71,517 48,396 53,215 48%
Other Operating Income (Expenses), Net (33,535) (27,207) (34,369) -
EBIT 366,648 184,674 (293,308) 99%
EBIT Margin 14.2% 7.8% -14.4% + 6.4 p.p.
Financial Result (171,294) (54,581) 114,621 214%
Financial Income 156,432 159,151 179,376 -2%
Financial Expenses (250,557) (269,349) (392,845) -7%
Net foreing exchange gain and losses (77,169) 55,617 328,090 -
Equity in the Results of Associate and Subsidiary Companies 15,278 37,080 36,655 -59%
Operating Profit (Loss) 210,632 167,173 (142,032) 26%
Income Tax / Social Contribution (34,922) (58,855) 18,675 -
Net Income (Loss) 175,710 108,318 (123,357) 62%
Net Margin 6.8% 4.6% -6.0% + 2.2 p.p.
Attributable:
Shareholders 117,073 88,901 (129,432) 32%
Minority Shareholders 58,637 19,417 6,075 202%
EBITDA (Instruction CVM 527) 710,527 528,095 60,620 35%
EBITDA Margin (Instruction CVM 527) 27.7% 22.5% 3.0% + 5.2 p.p.
Adjusted EBITDA - Joint Subsidiary Companies proportional EBITDA 749,852 532,769 67,784 41%
Adjusted EBITDA Margin 29.2% 22.7% 3.3% + 6.5 p.p.
Depreciation and Amortization 328,601 306,341 317,273 7%
Income Statement - Consolidated | IFRS
R$ thousand 1H17 1H16Chg.
1H17/1H16
Net Revenues 4,920,323 4,068,902 21%
Domestic Market 4,321,345 3,523,733 23%
Exports 598,978 545,169 10%
COGS (4,057,358) (4,106,785) -1%
Gross Profit 862,965 (37,883) -
Gross Margin 17.5% -0.9% +18,4 p.p.
Operating Income (Expenses) (311,643) (575,560) -46%
Selling Expenses (117,795) (135,436) -13%
Provision for Doubtful Accounts (20,253) (22,688) -11%
Other Selling Expenses (97,542) (112,748) -13%
General and Administrative (189,785) (175,896) 8%
Other Operating Income (Expenses) (4,063) (264,228) -98%
Reintegra Program 11,121 434 2462%
Provision for Legal Liabilities (63,750) (16,317) 291%
Result of the Non Operating Asset Sale/Write-Off 822 72,855 -99%
Result of the Sale of the Surplus Electric Energy (3,985) (85,262) -95%
Temporary Equipments Shutdown (includes depreciation) (208,548) (245,126) -15%
Impairment of Assets - (7,637) -
Acordo com Porto Sudeste 201,106 - -
Tax credit on imports PIS/COFINS 119,913 53,215 125%
Other Operating Income (Expenses), Net (60,742) (36,390) 67%
EBIT 551,322 (613,443) -
EBIT Margin 11.1% -15.0% + 26.1 p.p.
Financial Result (225,875) 216,174 -
Financial Income 315,583 285,588 11%
Financial Expenses (519,906) (744,461) -30%
Net foreing exchange gain and losses (21,552) 675,047 -
Equity in the Results of Associate and Subsidiary Companies 52,358 88,500 -41%
Operating Profit (Loss) 377,805 (308,769) -
Income Tax / Social Contribution (93,777) 34,035 -
Net Income (Loss) 284,028 (274,734) -
Net Margin 6% -6.7% + 12.4 p.p.
Attributable:
Shareholders 205,974 (282,202) -
Minority Shareholders 78,054 7,468 945%
EBITDA (Instruction CVM 527) 1,238,622 110,416 1022%
EBITDA Margin (Instruction CVM 527) 25.2% 2.7% + 22.5 p.p.
Adjusted EBITDA - Joint Subsidiary Companies proportional EBITDA 1,282,621 119,362 975%
Adjusted EBITDA Margin 26.1% 2.9% + 23.1 p.p.
Depreciation and Amortization 634,942 635,359 0%
Income Statement - Consolidated | IFRS
2Q17 Results
19
R$ thousand 2Q17 1Q17 2Q16
Operating Activities Cash Flow
Net Income (Loss) in the Period 175,710 108,318 (123,357)
Financial Expenses and Monetary Var. / Net Exchge Var. 103,431 4,178 (90,664)
Interest Expenses 150,932 192,519 88,477
Depreciation and Amortization 328,601 306,341 317,273
Losses/(gains) on Sale of Property, Plant and Equipment 586 (1,408) (883)
Equity in the Results of Subsidiaries/Associated Companies (15,278) (37,080) (36,655)
Impairment of Assets - - (393)
Difered Income Tax and Social Contribution (17,561) 30,605 (20,855)
Constitution (reversal) of Provisions 36,159 73,428 (9,422)
Actuarial Gains and losses 7,276 7,273 (372)
Stock Option Plan (441) 295 (5,515)
Total 769,415 684,469 117,634
(Increase)/Decrease of Assets
Accounts Receivables Customer (166,760) (85,924) 51,725
Inventories (52,898) (253,094) 192,095
Recovery of Taxes 49,529 2,125 37,836
Judicial Deposits (13,218) (16,947) (17,311)
Accounts Receiv. Affiliated Companies 321 219 2
Others (208,586) 25,957 44,097
Total (391,612) (327,664) 308,444
Increase /(Decrease) of Liabilities
Suppliers, Contractors and Freights 20,281 (163,220) 15,643
Amounts Owed to Affiliated Companies 4,409 (23,086) 4,697
Customers Advances (1,736) 19,288 21,075
Tax Payable 1,671 57,850 (18,918)
Securities Payable Forfaiting (279,310) 249,782 (21,351)
Actuarial Liability Payments (65,724) (59,582) (21,575)
Others (1,578) (3,782) (50,474)
Total (321,987) 77,250 (70,903)- - -
Cash Generated from Operating Activities 55,816 434,055 355,175 - - -
Interest Paid (183,716) (234,033) (126,129)
Income Tax and Social Contribution (5,637) (14,760) (3,835)- - -
Net Cash Generated from Operating Activities (133,537) 185,262 225,211
Investments activities cash flow
Marketable Securities (394,014) 1,025,604 (923,314)
Fixed Asset Acquisition (32,362) (22,674) (36,772)
Fixed Asset Sale Receipt 1 1,693 54,699
Dividends Received 12,543 1,274 1,624
Purchase of Software (1,689) (683) (4,575)- - -
Net Cash Employed on Investments Activities (415,521) 1,005,214 (908,338)- - -
Financial Activities Cash Flow
Settled Credits assignments - - (109,975)
Payment of Loans, Financ. & Debent. (8,065) (4,892) (12,741)
Shares Issued / Capital Increase - - 871,454
Payment of Taxes Installments (341) (335) (316)
Swap Operations Liquidations (199) (2,525) (20,786)
Dividends and Interest on Capital (3,643) - -
Capital Gain / Reduction (300,000) - -
Net Cash Generated from (Employed on) Financial Activities (312,248) (7,752) 746,643 - - -
Exchange Variation on Cash and Cash Equivalents 2,941 1,063 (9,554) - - -
Net Increase (Decrease) of Cash and Cash Equivalents (858,365) 1,183,787 53,962 - - -
Cash and Cash Equivalents at the Beginning of the Period 1,903,657 719,870 622,636
Cash and Cash Equivalents at the End of The Period 1,045,292 1,903,657 1,497,757 - - -
RECONCILIATION WITH BALANCE SHEET - - -
Cash and Cash Equivalents at the Beginning of the Period 1,903,657 719,870 622,636
Marketable Securities at the Beginning of the Period 511,980 1,537,584 1,112,991
Cash and Cash Equivalents at the Beginning of the Period 2,415,637 2,257,454 1,735,627
Net Increase (Decrease) of Cash and Cash Equivalentes (858,365) 1,183,787 53,962
Net Increase (Decrease) of Marketable Securities 394,014 (1,025,604) 923,314
Cash and Cash Equivalents at the End of the Period 1,045,292 1,903,657 676,598
Marketable Securities at the End of the Period 905,994 511,980 2,036,305
Cash and Cash Equivalents at the End of the Period 1,951,286 2,415,637 2,712,903
Cash Flow - Consolidated | IFRS
2Q17 Results
20
R$ thousand 1H17 1H16
Operating Activities Cash Flow
Net Income (Loss) in the Period 284,028 (274,734)
Financial Expenses and Monetary Var. / Net Exchge Var. 107,609 (145,075)
Interest Expenses 343,451 158,979
Depreciation and Amortization 634,942 635,359
Losses/(gains) on sale of property, plant and equipment (822) (2,855)
Equity in the Results of Subsidiaries/Associated Companies (52,358) (88,500)
Impairment of Assets - 7,637
Difered Income Tax and Social Contribution 13,044 (41,296)
Constitution (reversal) of Provisions 109,587 (6,850)
Actuarial Gains and losses 14,549 (722)
Stock Option Plan (146) (4,306)
Total 1,453,884 237,637 - -
Increase/Decrease of Assets - -
Accounts Receivables Customer (252,684) 179,288
Inventories (305,992) 480,828
Recovery of Taxes 51,654 89,225
Judicial Deposits (30,165) (30,155)
Accounts Receiv. Affiliated Companies 540 112
Others (182,629) 11,304
Total (719,276) 730,602
Increase /(Decrease) of Liabilities
Suppliers, contractors and freights (142,939) 31,755
Amounts Owed to Affiliated Companies (18,677) (19,565)
Customers Advances 17,552 39,278
Tax Payable 59,521 19,098
Securities Payable Derived from Suppliers (29,528) (205,977)
Actuarial Liability payments (125,306) (72,959)
Others (5,360) (188,253)
Total (244,737) (396,623)- -
Cash Generated from Operating Activities 489,871 571,616 - -
Interest Paid (417,749) (366,244)
Income Tax and Social Contribution (20,397) (7,970)- -
Net Cash Generated from Operating Activities 51,725 197,402
Investments activities cash flow
Marketable Securities 631,590 (812,120)
Fixed asset acquisition (55,036) (101,631)
Fixed asset sale receipt 1,694 57,063
Dividends Received 13,817 2,479
Software Purchase (2,372) (9,151) - -
Net Cash Employed on Investments Activities 589,693 (863,360)- -
Financial Activities Cash Flow
Assigned Credits - 43,832
Settled Credits assignments - (197,462)
Inflow of Loans, Financing and Debentures - -
Payment of Loans, Financ. & Debent. (12,957) (102,845)
Shares Issued / Capital Increase - 871,454
Payment of Taxes Installments (676) (868)
Swap Operations Liquidations (2,724) (51,509)
Dividends and Interest on Capital (3,643) (2)
Capital Gain / Reduction (300,000) -
Net Cash Generated from (Employed on) Financial Activities (320,000) 562,600 - -
Exchange Variation on Cash and Cash Equivalents 4,004 (20,316) - -
Net Increase (Decrease) of Cash and Cash Equivalents 325,422 (123,674) - -
Cash and Cash Equivalents at the Beginning of the Period 719,870 800,272
Cash and Cash Equivalents at the End of The Period 1,045,292 676,598 - -
RECONCILIATION WITH BALANCE SHEET - -
Cash and cash equivalents at the beginning of the period 719,870 800,272
Marketable securities at the beginning of the period 1,537,584 1,224,185
Cash and cash equivalents at the beginning of the period 2,257,454 2,024,457
Net increase (decrease) of cash and cash equivalentes 325,422 (123,674)
Net increase (decrease) of marketable securities (631,590) 812,120 - -
Cash and cash equivalents at the end of the period 1,045,292 676,598
Marketable securities at the end of the period 905,994 2,036,305
Cash and cash equivalents at the end of the period 1,951,286 2,712,903
Cash Flow - Consolidated | IFRS
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