TABLE OF CONTENTSweb3.cmvm.pt/sdi/emitentes/docs/PCS69652.pdf · According to the Concession Contract concluded with the Portuguese Government, the concession will end in December

TABLE OF CONTENTS

I - INTRODUCTION 3

II - CONCESSION'S CHARACTERISTICS AND CORPORATE BUSINESS 6

III - FINANCIAL REPORT 11

IV - FINANCIAL STATEMENTS 19

V - NOTES TO THE FINANCIAL STATEMENTS 24

I - INTRODUCTION

I - INTRODUCTION

INTERIM REPORT - 1ST HALF 2018 4

Governing Bodies (2018/2020)

The Board of Directors

Chairman Vasco Maria Guimarães José de Mello

Member João Pedro Stilwell Rocha e Melo

Members João Pedro Ribeiro de Azevedo Coutinho

Member António José Lopes Nunes de Sousa

Member Daniel Alexandre Miguel Amaral

Member Michael Gregory Allen

Member Manuel Rebelo Teixeira Melo Ramos *

MEMBER Fernando Aboudib Camargo

Member António José Louçã Pargana

Member Miguel José Pereira Athayde Marques **

Member Maria de Fátima Henriques da Silva Barros Bertoldi **

Member José Maria Campos da Silva André **

* Managing Director

** Independent Director

Board of the General Meeting

Chairman of the Board Luís Rua Geraldes

Secretary Tiago Severim de Melo

Supervisory Board

Chairman Francisco Xavier Alves

Members Tirso Olazábal Cavero

Joaquim Patrício da Silva

Alternate member Diogo da Gama Lobo Salema da Costa

External Auditor Pricewaterhousecoopers & Associados, SROC S.A. represented by

Rui Jorge dos Anjos Duarte ROC nº 1532

Alternate external auditor Carlos José Figueiredo Rodrigues ROC no. 1737

Corporate Secretary Tiago Severim de Melo

I - INTRODUCTION


Statement of Compliance

Under the terms of paragraph 1-c) of article 246 of the Securities Code, and in compliance with legal and statutory

provisions, the Board of Directors hereby submits the condensed financial statements and interim management

report relating to the first semester of 2018, in the firm belief, to the best of its knowledge, that the information

contained therein was prepared in accordance with relevant accounting standards, providing a true and fair view

of the assets and liabilities and the financial situation of the issuer and that the management report contains a

faithful account of the information required.

Additional information

Under the terms of article 8 of the Securities Code Brisa Concessão Rodoviária, S.A. Informs that the financial

statements as of 30 June 2018 were prepared in accordance with the International Financial Reporting Standards

(IFRS) and were not the object of any Audit Report.

São Domingos de Rana, 21 August 2018

II - CONCESSION'S

CHARACTERISTICS

AND CORPORATE

BUSINESS

II - CONCESSION'S CHARACTERISTICS AND CORPORATE BUSINESS


Brisa Concession

Key Indicators (1st Half 2018)

Operating income

€M 277.5

EBITDA 1

€M 210.4

Net Debt / EBITDA 2

4.34x

Number of employees

9

1 EBITDA = Earnings Before Interest, Taxes, Depreciation and Amortisation. Does not include income associated with the construction

service

2 Figures used to determine the ratio may be different from those reported in the accounts due to adjustments made to reflect

provisions in financial contracts

Concession’s main features

BCR's concession totals 1 124 km, comprising 12 motorways including the future access to the New Lisbon

Airport. The network subject to concession is almost entirely built hence BCR presently operates 11 motorways,

covering a total length of 1 100.1 km, of which 1 014.0 km are tolled.

The network will be fully completed following the construction of the access to the New Lisbon Airport, which is

currently on hold.

The network runs from North to South and East to West. It includes the country's main road axes, such as the

coastal corridor and the Lisbon-Madrid link. It also includes important circular roads around the metropolitan

areas of Lisbon and Oporto.



According to the Concession Contract concluded with the Portuguese Government, the concession will end in

December 2035.

Key features of the Concession as at 30 June 2018

Motorway

Length in km

Tolled Toll Free Total 2x1

lanes 2x2

lanes 2x3

lanes 2x4

lanes

A1 – Autoestrada do Norte 279.0 17.4 296.4 1.3 156.1 131.7 7.3

A2 - Autoestrada do Sul 225.2 9.6 234.8 0.0 202.8 32.0 0.0

A3 - Autoestrada Porto - Valença 101.3 11.5 112.8 0.0 91.6 12.8 8.4

A4 - Autoestrada Porto - Amarante 48.3 3.0 51.3 0.0 51.3 0.0 0.0

A5 - Autoestrada da Costa do Estoril 16.9 8.1 25.0 0.0 2.3 22.7 0.0

A6 - Autoestrada Marateca - Elvas 138.8 19.1 157.9 0.0 157.9 0.0 0.0

A9 - Circular Regional Externa de Lisboa 34.4 0.0 34.4 0.0 0.0 34.4 0.0

A10 - Autoestrada Bucelas - Carregado - IC3 39.8 0.0 39.8 0.0 7.4 32.4 0.0

A12 - Autoestrada Setúbal - Montijo 24.8 4.3 29.1 4.3 5.2 19.6 0.0

A13 - Autoestrada Almeirim - Marateca 78.7 0.0 78.7 0.0 78.7 0.0 0.0

A14 - Autoestrada Figueira da Foz - Coimbra (Norte) 26.8 13.1 39.9 0.0 39.9 0.0 0.0

Total 1 014.0 86.1 1 100.1 5.6 793.2 285.6 15.7

Traffic on the network

In the first half of 2018 the macroeconomic situation remained positive, although GDP and private consumption

growth rates slowed down compared to the previous year. This macroeconomic environment supported a

continued traffic growth in every motorway of BCR’s concession. Average Daily Traffic (ADT) in BCR network grew

by 4.1%, notwithstanding the unfavourable weather conditions recorded in the period. Traffic volume on BCR

concession reached 18 795 vehicles/day, in line with the strong growth dynamics of the last few years.

Organic traffic growth in BCR network reached 4.5%. Traffic changes due to holidays were slightly negative in this

first semester of 2018, contributing to a slight drop in the final growth.



Breakdown of annual traffic change

* Including leap year impact

In line with previous years, demand in all the concession's motorways continued increasing, ranging from 2.2%

on the A5 to 9.7% on the A10. The A9 motorway is also showing strong performance, as a result of the growing

saturation of the IC17/CRIL.

Change in Average Daily Traffic by Motorway (1H2018)

(YoY growth)

v.km

Organic growth

Calendar effect(*)

Others

ADT

Like-for-like

4.5%

-0.5% -0.7%

1H 17 1H 18

7.4% 4.1%

6.8% 4.1%

-0.4% 0.3%

18 049 18 795

7.7%

4.1%

3.2%

4.6%

3.1%

2.2%

5.2%

9.2%9.7%

5.0% 4.9%

3.5%4.1%

A1 A2 A3 A4 A5 A6 A9 A10 A12 A13 A14 BCR



An analysis of the evolution of traffic by type of vehicle shows that heavy vehicles growth was stronger as

compared to light vehicles (+7.6% and +3.9% respectively), benefiting from Portugal’s positive economic

momentum.

Capital Expenditure (CAPEX)

Capital expenditure (CAPEX) in the network under concession totalled €M 16.7 and it was mostly related with

lane widening and pavement improvement works. This figure includes €M 9.8 relating to major repairs

(pavements, engineering works and slopes), which are treated as provisions, in accounting terms, according to

IFRIC 12.

Capital Expenditure (CAPEX)

Capital expenditure on widening works totalled €M 2.0 in the period, relating mainly to the final widening and

improvement works of the Carvalhos-Santo Ovídeo sub-stretch on the A1. The tender for the widening to 2x4

lanes and improvement works on the Águas Santas-Ermesinde sub-stretch of the A4 and the renovation of the

Águas Santas tunnels is presently on hold due to legal dispute concerning the tender process. Since the end of

the reporting period these disputes have been resolved and BCR anticipates commencement of the works in the

third quarter. BCR is continuing its maintenance plan of engineering structures, slopes and signing works. In

environmental terms, BCR continued the deployment of noise barriers, namely on the A1 and A2.

Capital expenditure in BCR infrastructure in the second half of 2018, which is focused mainly on major repairs

and widening works, is likely to surpass that recorded in the first half.

€M 1H 17 1H 18 % Change

Widening works 7.5 2.0 -73.5%

Major repairs 8.6 9.8 14.7%

Other (equipment, etc) 3.4 4.9 45.9%

Total 19.4 16.7 -13.7%

7.6%

3.9%

Heavy Vehicles Light Vehicles

93.9%

6.1%

Light Vehicles Heavy Vehicles

YoY ADT Growth (1H2018) Traffic Structure (1H2018)

III - FINANCIAL

REPORT

III - FINANCIAL REPORT


Income and Loss Statement

Operating income

In the 1st half of 2018 operating income (not including revenue associated with the construction service) totalled

€M 277.5, increasing by 7.7% over the same period of the previous year. The breakdown is as follows:

Toll revenues increased to €M 267.3 (+6.2% in year-on-year terms), boosted by the increase in traffic and by an

upward revision in toll tariffs (1.4%). Note the sharp rise in revenues relating to service areas, which reached €M

7.6 (+127% over the same period of the previous year), benefiting from the renegotiation of respective sub-

concession contracts.

The Statement of Profit and Loss and Other Comprehensive Income includes an equal amount (€M 3.9 in first

half of 2018) recorded under operating income and costs, reflecting the recognition of income and expenses

relating to construction services within the scope of the concession. This was recorded so as to comply with IAS

11 standard and paragraph 14 of IFRIC 12. From a substantive and economic perspective, total operating income

and costs to determine EBITDA do not include income and expenses recognised pursuant to IAS 11.

€M 1H 17 1H 18 % Change

Toll revenues 251.6 267.3 6.2%

Service areas 3.4 7.6 127.1%

Other 2.7 2.5 -6.7%

Total 257.7 277.5 7.7%



Operating Costs

In the first half of 2018 Operating Costs, excluding Amortisation / Depreciation and Provisions, totalled €M 67.1

(+4.2% as compared to the same period of the previous year), reflecting the increase in activity. Note that the

increase in operating expenses was considerably lower than the increase in revenues.

External Supplies and Services, which mainly reflect the costs of sub-contracted services for the operation and

maintenance of the motorway network and electronic toll collection costs increased by 4.3% compared to the

same period of the previous year, totalling €M 65.6. This amount includes additional costs relating to the National

Forest Fire Protection System and to repairs carried out beyond the scope of provisions for infrastructure

replacement (IAS 37).

As of 30 June 2018 BCR had 9 employees, 3 less than in the same period of previous year. Personnel costs totalled

€M 0.8 in the first half of 2018.

Amortization, Depreciation and Provisions net of reversals totalled €M 85.3 (-0.1% versus the first semester of

2017), including €M 18.4 relating to provisions in accordance with IFRIC 12, which are related to the costs the

company will incur in the future, namely major repairs in the network.

Operating Results

Operating Results (EBITDA) in the first semester of 2018 totalled €M 210.4, increasing by 8.8% (+€M 17.1) over

the same period of the previous year. The rise in operating income, higher than the increase in operating costs,

pushed the EBITDA margin up.

EBIT totalled €M 125.0, increasing by 15.9% YoY.

€M 1H 17 1H 18 % Change

External services and supplies 62.9 65.6 4.3%

Staff costs 0.9 0.8 -9.5%

Other costs 0.6 0.7 11.4%

Sub-total 64.4 67.1 4.2%

Amortization and Provisions 85.4 85.3 -0.1%

Total 149.8 152.4 1.7%



Financial Results

In the first half of 2018 BCR recorded negative financial results of €M 35.5, improving by €M 4.3 in relation to

the same period of the previous year.

Financial income, which derive entirely from interest earned, stood close to zero, continuing to reflect the low

rates offered for bank deposits.

Financial expenses evolved quite favourably, decreasing by 10.8% as against the same period the previous year.

This decrease is mainly explained by the reduction of financial expenses following the repayment in April 2018

of the €M 300 bond (6.875% coupon). This effect was partially offset with a new €M 300 bond issued in May

2017 (2.375% coupon).

Net Profit

Net Profit totalled €M 62, determined by reference to Profit Before Tax of €M 89.5 and income tax expenses of

€M 27.5.

€M 1H 17 1H 18 % Change

Financial income 0.0 0.0 -

Financial expenses 39.8 35.5 -10.8%

Interest Expenses 31.1 27.8 -10.5%

IFRIC 12 3.9 3.2 -18.8%

Other Financial Expenses 4.8 4.6 -5.6%

Financial Results -39.8 -35.5 -

€M 1H 17 1H 18 % Change

Earnings before taxes 68.0 89.5 31.6%

Taxes 19.3 27.5 42.3%

Net Income 48.7 62.0 27.3%



Statement of Financial Position

Financial debt and liquidity

As of 30 June 2018 BCR’s gross debt totalled €M 2 0911, decreasing by €M 329 in relation to the end of 2017 (in

nominal terms, as of 30 June 2018 gross debt totalled €M 2 128). Liquidity at the end of the semester totalled

€M 149 (as against €M 446 at 31 December 2017), of which €M 95 were placed in reserve accounts to be used

for CAPEX and debt service purposes. As a result, at the end of the semester, from an accounting point of view,

BCR’s net debt totalled €M 1 941, having decreased by €M 32 in the period (in nominal terms, it fell €M 2 to €M

1 979). The breakdown of gross debt according to instrument was as follows:

(*) This amount corresponds to the nominal value of debt, which totalled €M 2 426 and €M 2 128 in 2017 and 1H2018, respectively, net of accrued interest and expenses including loan issuance and placement costs, recognized according to the effective interest method throughout the life of the loans.

Bonds

In April 2018 BCR repaid a €M 300 bond (6.875% coupon), which had been issued in October 2012.

Following this, as of 30 June 2018 BCR had 6 bond issues with a total nominal value of €M 1 420 with the following

terms:

* Fixed interest rate of 6% in the first five years and thereafter indexed to the consumer price index except housing as from the sixth year to maturity, plus 4.5%.

1 Accounting Debt

€M 2017 1H 18 Change

Gross Debt a 2 419 2 091 329

Bonds 1 734 1 402 -332

EIB 486 468 -18

Other loans 200 200 1

Cash 446 149 -297

Net Debt 1 973 1 941 -32

€M Nominal Coupon Maturity

Bond 2021 300 3.875% 2021

Bond 2022 120 Eur6M + 2.4% 2022

Bond 2023 300 2.000% 2023

Bond 2025 300 1.875% 2025

Bond 2027 300 2.375% 2027

Bond 2032 100 Inflation + 4.5%* 2032

68%

22%

10%

Bonds EIB Other loans

Breakdown of Gross Debt (from an accounting perspective)



EIB and Other Loans

At the end of the year BCR had one loan with the European Investment Bank (EIB), which has a floating interest

rate indexed to the 6-month Euribor rate. This loan is subject to fixed principal repayments every half-year until

December 2030. At 30 June 2018 the amount outstanding under this loan totalled €M 468.

Additionally, at the end of the first half of 2018 BCR had committed credit lines and commercial paper

programmes totalling €M 450, of which €M 200 was used and €M 250 was undrawn. It should be noted that in

June 2018 BCR extended the maturity of one of its committed credit lines up to 2021 and reduced its nominal

amount to €M 50 from €M 75.

Debt Profile

As result of a proactive management of refinancing risk, the debt repayment profile of BCR is well balanced: the

maximum amount due in a year is €M 339 (corresponding to the repayment of a €M 300 bond and to the annual

repayment of the EIB loan in the amount of €M 39).

At the end of the semester approximately 66% of BCR’s debt had fixed interest rates and the remaining 34% had

floating interest rates. The weighted average cost of debt during the first half of 2018 (including the impact of

derivative instruments) was 2.5%, corresponding to a c.30 bps decrease in the year compared to 2017.

0

100

200

300

400

2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031 2032

Other loans

Bonds

EIB

Debt repayment profile (€M)



Financial Position

At the end of the first half of 2018 BCR’s Net Assets totalled €M 2 594, comprising mostly intangible assets

associated with concession rights and bank deposits.

Liabilities decreased by €M 311 in relation to December 2017 (down to €M 2 442), as a result of the above

mentioned repayment of the €M 300 bond in April.

Equity fell by €M 32 (to €M 153), mainly as result of the payout to shareholder BCR SGPS, S.A. in the total amount

of €M 94.5, partially offset by the net profit for the semester.

Covenants and Rating

In addition to its contractual and financial structure, which grants creditors high protection, BCR follows

principles of prudent and conservative financial management. The four covenants in the form of financial ratios

(namely Net Senior Debt/EBITDA, Historic ICR, Forward Looking ICR and CLCR) to which BCR is subject stood

within established thresholds as of 30 June 2018.

The Net Senior Debt / EBITDA ratio stood at 4.34x, i.e. below the level posted at the end of 2017 (4.51x) and

significantly below 5.75x the dividend lock-up level, thus providing a high margin in relation to established

thresholds.

Historic ICR ratio as of 30 June 2018 stood at 5.73x, over and above the established trigger event threshold of

2.25x, representing an increase in relation to the 5.68x ratio recorded at the end of 2017.

In January 2018, Fitch revised its long-term rating upwards to ‘BBB+’ from ‘BBB’, with Stable Outlook and short-

term rating was confirmed at ‘F2’. ‘Baa3’ long-term rating (Positive Outlook) from Moody’s did not change in the

semester.

Agencies Rating Outlook

Moody’s Baa3 Positive Outlook

Fitch Ratings BBB+ Stable Outlook



THE BOARD OF DIRECTORS

Vasco Maria Guimarães José de Mello

João Pedro Stilwell Rocha e Melo

João Pedro Ribeiro de Azevedo Coutinho

António José Lopes Nunes de Sousa

Daniel Alexandre Miguel Amaral

Michael Gregory Allen

Manuel Rebelo Teixeira Melo Ramos

Fernando Aboudib Camargo

António José Louçã Pargana

Miguel José Pereira Athayde Marques

Maria de Fátima Henriques da Silva Barros Bertoldi

José Maria Campos da Silva André

IV - FINANCIAL STATEMENTS


IV - FINANCIAL

STATEMENTS



Statement of Financial Position

as of 30 June 2018 and 31 December 2017 (amounts in Euro)

Notes 30.06.2018 31.12.2017

Non current assets

Tangible fixed assets 9 8 435 933 8 987 484

Intangible assets 10 2 319 082 622 2 380 277 595

Advances to be forwarded as tangible fixed assets 9 25 150 30 150

Deferred tax assets 11 69 248 343 66 381 756

Total non-current assets 2 396 792 048 2 455 676 985

Current assets

Inventories 1 787 1 868

Trade and other receivables 47 508 963 33 221 161

Other current assets 709 140 2 144 833

Cash and cash equivalent 12 149 155 321 445 811 111

Total current assets 197 375 211 481 178 973

Total assets 2 594 167 259 2 936 855 958

Shareholders' equity:

Share capital 13 75 000 000 75 000 000

Legal reserve 14 15 000 000 15 000 000

Other reserves 14 620 835 3 677 079

Net income 62 005 375 136 083 795

Interim dividends - ( 45 148 219)

Total shareholders' equity 152 626 210 184 612 655

Non-current liabilities:

Loans 15 1 976 575 834 1 994 019 296

Provisions 17 193 337 174 190 796 680

Other non current liabilities 18 39 791 747 42 284 335

Total non-current liabilities 2 209 704 755 2 227 100 311

Current liabilities:

Provisions 17 24 792 262 17 219 791

Trade payables 22 25 308 130 25 357 343

Loans 15 113 945 461 425 221 493

Suppliers of investment 9 769 990 16 534 697

Other accounts payable 2 242 332 1 979 482

Current tax liabilities 6 30 605 205 21 991 554

Other current liabilities 19 25 172 914 16 838 632

Total current liabilities 231 836 294 525 142 992

Total liabilities and equity 2 594 167 259 2 936 855 958

The accompanying notes form an integral part of the statement of financial position for the period ended 30 June 2018.

THE CERTIFIED ACCOUNTANT NO. 62018 THE BOARD OF DIRECTORS



Statement of profit and loss and other comprehensive income

as of 30 June 2018 and 2017 (amounts in Euro)

Notes 30.06.2018 30.06.2017

Operating income:

Rendered Services 3 274 947 173 254 984 774

Other operating income 3 2 507 933 2 692 115

Reversal of amortisation, depreciation, adjustments and provisions 3, 16 and 17 2 729 932 3 347 553

Income associated to construction service 3 3 873 812 8 993 897

Total operating income 284 058 850 270 018 339

Operating expenses:

External supplies and services 4 ( 65 581 073) ( 62 854 054)

Personnel costs ( 812 371) ( 897 290)

Amortisation, depreciation and adjustments 9, 10 and 16 ( 66 940 572) ( 66 587 451)

Provisions 17 ( 21 109 991) ( 22 204 040)

Tax ( 637 419) ( 593 732)

Other operating expenses ( 57 813) ( 30 171)

Expenses associated to construction service 3 ( 3 873 812) ( 8 993 897)

Total operating expenses ( 159 013 051) ( 162 160 635)

Operating Results 125 045 799 107 857 704

Financial expenses 5 ( 35 549 403) ( 39 841 266)

Financial income 5 7 954 14 999

Profit before tax 89 504 350 68 031 437

Income tax 6 ( 27 498 975) ( 19 325 394)

Net income for the semester 62 005 375 48 706 043

Other income and expenses recognised under Shareholders' Equity

which will be reclassified to results:

Increase/(decrease) in the fair value of financial instruments, net of tax effect 11, 14 and 20 508 180 900 944

Income recognised directly in shareholders' equity 508 180 900 944

Total net results and other comprehensive income for the semester 62 513 555 49 606 987

Earnings per share:

Basic 7 4.13 3.25

Diluted 7 4.13 3.25

The accompanying notes form an integral part of the results and other comprehensive income for the semester ended 30 June 2018.




Statement of changes in shareholders' equity


Share issue Legal Other Net Interim

Notes Share capital premium reserve Reserves results dividend Total

Balance at 01 January 2017 75 000 000 26 544 809 12 928 675 1 976 339 91 683 102 - 208 132 925

Net income for the semester of 2017 - - - - 48 706 043 - 48 706 043

Increase/(decrease) in the fair value of financial hedging instruments

net of tax 11 and 20 - - - 900 944 - - 900 944

Total net results and other comprehensive income for the semester - - - 900 944 48 706 043 - 49 606 987

Appropriation of net income for 2016:

Transferred to legal reserve - - 2 071 325 - ( 2 071 325) - -

Dividends 8 - - - - ( 89 611 777) - ( 89 611 777)

Share capital increase 13 11 850 000 ( 11 850 000) - - - - -

Share capital decrease 13 ( 11 850 000) - - - - - ( 11 850 000)

Balance at 30 June 2017 75 000 000 14 694 809 15 000 000 2 877 283 48 706 043 - 156 278 135

Balance at 01 January 2018 75 000 000 - 15 000 000 3 677 079 136 083 795 ( 45 148 219) 184 612 655

Net income for the semester of 2018 - - - - 62 005 375 - 62 005 375

Increase/(decrease) in the fair value of financial hedging instruments

net of tax 11, 14 and 20 - - - 508 180 - - 508 180

Total net results and other comprehensive income for the semester - - - 508 180 62 005 375 - 62 513 555

Appropriation of net income for 2017:

Dividends 8 - - - - ( 136 083 795) 45 148 219 ( 90 935 576)

Distribution of free reserves 8 - - - ( 3 564 424) - - ( 3 564 424)

Balance at 30 June 2018 75 000 000 - 15 000 000 620 835 62 005 375 - 152 626 210

The accompanying notes form an integral part of the statement of changes in shareholders' equity for the period ended 30 June 2018.

The Certified Accountant, no. 62018 THE BOARD OF DIRECTORS



Cash Flow Statement


Notes 30.06.2018 30.06.2017

OPERATING ACTIVITIES:

Cash receipts from clients 267 731 734 249 165 478

Cash paid to suppliers ( 66 586 634) ( 63 642 791)

Cash paid to personnel ( 772 494) ( 962 820)

Flows generated by operations 200 372 606 184 559 867

Income tax paid ( 21 576 417) ( 11 123 404)

Payments for the replacement of infrastructures ( 13 752 722) ( 13 254 756)

Other receipts/(payments) relating to operating activities 2 574 151 4 573 060

Net cash from operating activities (1) 167 617 618 164 754 767

INVESTMENT ACTIVITIES

Cash receipts relating to:

Tangible and intangible fixed assets 6 100 60 364

Investment subsidies 406 727 -

Interest and similar income 39 433 5 571

452 260 65 935

Cash payments relating to:

Tangible and intangible fixed assets ( 8 717 702) ( 11 700 798)

Net cash from investing activities (2) ( 8 265 442) ( 11 634 863)

FINANCING ACTIVITIES

Cash receipts relating to:

Borrowings 150 000 000 913 500 000

Cash payments relating to:

Borrowings ( 469 492 704) ( 682 992 704)

Share capital decreases 13 - ( 11 850 000)

Interest and similar costs ( 61 361 923) ( 59 619 186)

Dividends 8 ( 94 500 000) ( 89 611 776)

Derivative financial instruments ( 1 130 350) ( 1 638 514)

( 626 484 977) ( 845 712 180)

Net cash from financing activities (3) ( 476 484 977) 67 787 820

Foreign exchange effect (4) ( 54) -

Variation in cash and cash equivalents (5) = (1) + (2) + (3) + (4) ( 317 132 855) 220 907 724

Cash and cash equivalents at the beginning of the semester 12 445 811 111 118 312 185

Cash and cash equivalents at the end of the semester 12 128 678 256 339 219 909


The accompanying notes form an integral part of the cash flow statement for the semester ended 30 June 2018.

V - NOTES TO THE

FINANCIAL

STATEMENTS

V - NOTES TO THE FINANCIAL STATEMENTS


Notes to the Financial Statements

As of 30 June 2018 (Amounts in Euro)

1. INTRODUCTION

Brisa – Concessão Rodoviária, S.A. (the “Company” or “BCR”), previously called MCall – Serviços de

Telecomunicações, S.A., was set up in 2001. On 30 April 2010, following the spin off of the call centre business into a new company and subsequent amendment of the company's articles of association, BCR's main object became the construction, maintenance and operation of motorways and respective service areas pursuant to a concession contract, and the planning and development of social equipment infrastructures.

The above-mentioned spin off was carried out in April 2010, with accounting effect as of 1 January 2010, following the separation of the call centre services assets.

On 22 December 2010 the Company, which is included in the consolidation perimeter of the Brisa Group,

was assigned by Brisa - Auto-Estradas de Portugal, S.A. (“BAE”) the latter's position in the concession

contract approved by Council of Ministers Resolution no. 198-B/2008, of 31 December (“Brisa Concession”). This operation was followed by the assignment by BAE of a set of assets and liabilities allocated to Brisa Concession, by means of contributions in kind for the purposes of a share capital increase that took place on 22 December 2010.

The bases of Brisa Concession were established pursuant to Decree-law 467/72 of 22 November, namely the construction, maintenance and operation of motorways. Since then, the concession bases were revised on several occasions, following amendments to the concession contract.

Decree-Law 294/97 of 24 October, Decree-Law 287/99, of 28 July, Decree-Law 314 A/2002, of 26 December, and Decree-Law 247-C/2008, of 30 December approved the bases of the concession currently in force; these bases are as described below, having relevant impact on the Company's financial and economic situation:

• The fixation of the network’s total length. The motorway network under concession and open to

traffic is currently of 1 100 km, of which 86 km are not subject to tolls. The network under concession will be completed with the construction of the access to the new Lisbon airport presently on hold, and its final length will depend on the airport's location.

• The term of the concession was fixed at 31 December 2035 and tangible and intangible fixed assets directly related to the concession as recognized in the financial statements, will revert to the State at the end of the period.

• The Company's minimum share capital is Euro 75 million.

• In the last 5 years of the concession the State may terminate it against compensation payable to the Concessionaire.

The supervision of the concession falls to the Ministry of Finance in what concerns financial matters and to the ministry responsible for the road sector as concerns remaining issues.



2. MAIN ACCOUNTING POLICIES

Basis of presentation

The accompanying financial statements were prepared in accordance with provisions in IAS 34 – Interim

Financial Report; accordingly, they should be read jointly with the financial statements for the year ended at 31 December 2017.

Accounting policies

Accounting policies adopted are consistent with those followed in the preparation of the financial statements for the year ended as of 31 December 2017 and referred in respective notes.

During the semester ended as of 30 June 2018, various interpretations, amendments and revisions of standards endorsed by the European Union have entered into force, but they had no impact on the Company's financial statements.

3. OPERATING INCOME

Operating income for the semesters ended as of 30 June 2018 and 2017 are made up as follows:

(a) Within the scope of BCR concession contract covered by IFRC 12, construction activity is sub-contracted to external specialised companies. As result, BCR does not have any margin in the construction of assets allocated to the concession; hence revenue and expenses associated to the construction of these assets are recorded in equal amount.

In the semesters ended at 30 June 2018 and 2017, operating income included transactions with group and other related companies in the amount of € 8 358 344 and € 1 008 270 respectively (Note 22).

30.06.2018 30.06.2017

Services rendered:

Tolls 267 317 975 251 624 654

Service areas 7 629 198 3 360 120

274 947 173 254 984 774

Other operating income:

Compensation for operating losses (Note 18) 786 112 786 113

Recovery of revenues 648 878 751 014

Equipment rental 590 398 583 947

Toll fines 449 852 552 757

Gains on tangible and intangible fixed assets 29 683 17 849

Other 3 010 435

2 507 933 2 692 115

Reversal of amortisation, depreciation and adjustments

and provisions:

Provisions (Note 17) 2 657 522 3 256 837

Accounts receivable (Note 16) 72 410 90 716

2 729 932 3 347 553

Income associated to construction service (a) 3 873 812 8 993 897

284 058 850 270 018 339



4. SUPPLIES AND SERVICES

The Goods & Services Account for the semesters ended 30 June 2018 and 2017 is made up as follows:

In the semesters ended at 30 June 2018 and 2017, the Goods & Services Account included transactions with group and other related companies in the amount of € 62 968 139 and € 60 661 590, respectively (Note 22).

5. FINANCIAL RESULTS

Financial results for the semesters ended as of 30 June 2018 and 2017 were made up as follows:

(a) This heading includes mainly expenses with banking services and funding, forming an integral part of the effective financing cost.

30.06.2018 30.06.2017

Operation and Maintenance 46 013 499 43 872 721

Logistic and administrative support 10 565 578 10 421 368

Electronic toll services 5 307 017 5 203 164

Maintenance and repair

Motorway stretches 1 611 384 1 086 495

Other 74 874 150 268

Insurance 718 691 746 089

Technical and administrative assistance 303 958 329 406

Advertising costs 158 784 206 150

Communications 158 789 127 602

Legal and tax advice 149 780 175 402

Fuel 136 757 138 714

Studies and opinions 104 926 81 923

Legal services 41 773 133 348

Other 235 263 181 404

65 581 073 62 854 054

30.06.2018 30.06.2017

Expenses and losses:

Interest expense 27 788 051 31 064 482

Financial revision of provisions for

the replacement of infrastructures (Note 17) 3 200 295 3 942 605

Other (a) 4 561 057 4 834 179

35 549 403 39 841 266

Income and gains:

Interest gained 7 360 14 999

Other 594 -

7 954 14 999

Financial results ( 35 541 449) ( 39 826 267)



6. INCOME TAX

The Company is subject to Corporate Income Tax ("IRC) at the normal rate of 21%, which can be increased by a municipal surcharge of up to a maximum rate of 1.5% of the taxable income.

Additionally, the nominal tax rate may vary from 21% to 31.5%, depending on the amount of taxable income (TI) determined, which will be subject to a tax surcharge at the following rates:

- STATE SURTAX: 3% ON TI IF €M 1.5 < TI <= €M 7.5;

5% ON TI IF €M 7.5 < TI <= €M35; AND

9% ON TI > €M 35

In accordance with current legislation, tax returns are subject to review and correction by the tax authorities during a period of four years (five years for social security), except where tax losses exist, or tax benefits have been granted or inspections, claims or appeals are in progress, in which case, depending on the circumstances, the period can be extended or suspended. Therefore, the Company's tax returns for the years 2014 to 2017 may still be subject to review and correction.

As of 30 June 2018 tax proceedings concerning years 2011 and 2012 (Note 21) are still pending; in line with what is stated in Tax Inspection Reports for BAE relating to years 2007 to 2010, the Tax Authority ("TA") concluded as to the inadequacy of the legal and tax framework applied to the securitization of future receivables in the amount of € 400 000 000, carried out in 19 December 2007 and transferred to BCR as part of the assets and liabilities allocated to Brisa Concession (Note 1). The report further established that the Company fails to comply with the legislation for the securitization of credits as provided in Decree-law 453/99 of 5 November, as amended by Decree-Law 82/02 of 5 April, and consequently the tax regime provided in Decree-Law 219/2001 of 4 August, both altered by Decree-law 303/2003 of 5 December is not applicable.

In view of the above, the Tax Authority considers that:

• Income corresponding to the services giving rise to the future receivables must be recognized, in tax and accounting terms, in the tax periods in which they are generated;

• When determining the taxable income relating to 2012 and 2011 (already inspected) an amount of € 80 000 000 each year was wrongly deducted from taxable income.

The Board of Directors, based on the opinion of its legal and accounting experts and consultants, deems that the recognition of the said operation is adequately based from the legal point of view, and therefore, it is also adequately based in accounting and tax terms. As result, the Board of Directors deems that the corrections proposed in the Tax Inspection Report relating to 2012 and 2011 are totally unfounded; therefore, as parent company within the scope of RETGS in the year concerned, BCR will use all legal means at its disposal as taxpayer to assert the accounting treatment given to this operation at all levels. In view of the above, as of 30 June 2018, no provision was recorded for this purpose.



During the semester ended at 30 June 2018 tax inspection procedures were started concerning the tax periods of 2015 and 2016, and they are still under way.

The Board of Directors believes that any possible corrections resulting from revisions/inspections of these tax returns will not have significant impact on the financial statements as of 30 June 2018.

The deadline for the deduction of reportable tax losses (RTL) is as follows:

The deduction amount to be made in each of the tax periods is limited to 70% of respective taxable income.

Income tax recognised in the semesters ended 30 June 2018 and 2017 is made up as follows:

Reconciliation between profit before income tax and income tax for the year as of 30 June 2018 and 2017 is as follows:

Tax period Deduction periods

2017 5

2016 12

2015 12

2014 12

2013 5

30.06.2018 30.06.2017

Current tax 30 599 251 23 651 000

Deferred tax (Note 11) ( 3 100 276) ( 3 938 383)

Taxes on previous years income - ( 387 223)

27 498 975 19 325 394

30.06.2018 30.06.2017

Profit before tax 89 504 350 68 031 437

Expected tax (22.5% rate) 20 138 479 15 307 073

Provisions 2 271 370 3 097 468

Impairment losses 67 421 44 828

Derivative financial instruments ( 56 887) ( 81 038)

Other - 92

Autonomous taxation 8 215 15 456

State surcharge 8 170 653 5 267 121

Taxes on previous years income - ( 387 223)

Set up/reversal of deferred taxation (Note 11) ( 3 100 276) ( 3 938 383)

Income tax 27 498 975 19 325 394

Effective tax rate 30.72% 28.41%



As of 30 June 2018 and 31 December 2017 current income tax liabilities were made up as follows:

7. EARNINGS PER SHARE:

Basic and diluted earnings per share for the semesters ended 30 June 2018 and 2017 were determined based on the following amounts:

At 30 June 2018 and 2017 no diluting effects have occurred; hence, basic and diluted earnings per share are identical.

8. DIVIDENDS

The General Shareholders Meetings held on 16 March 2018 and 29 March 2017 decided on the payment of dividends in the amounts of € 90 935 576 and € 89 611 777, respectively, concerning the net profit for the years ended 31 December 2017 and 2016. At the General Shareholders Meeting held on 16 March 2018 it further was decided to distribute free reserves in the amount of € 3 564 424.

At the General Shareholders Meeting held on 11 October 2017 it was decided an anticipated dividend distribution to the sole shareholder in the amount of € 45 148 219 on the net profit for the year ended as of 31 December 2017, which was paid on 30 October 2017.

30.06.2018 31.12.2017

Corporate Income Tax (CIT)

Tax estimate 30 599 251 59 161 865

Payment on account - ( 35 394 387)

Tax withheld - ( 1 775 924)

Other 5 954 -

30 605 205 21 991 554

30.06.2018 30.06.2017

Basic and diluted earnings per share

Result for the purpose of determining the basic and

diluted earning per share (net profit for the semester) 62 005 375 48 706 043

Average number of shares for the purpose of determining

the basic and diluted earning per share 15 000 000 15 000 000

Basic and diluted earnings per share 4.13 3.25



9. TANGIBLE FIXED ASSETS

Changes in other tangible fixed assets and corresponding accumulated depreciation and impairment losses in the semesters ended 30 June 2018 and 2017 were as follows:

30.06.2018

Buildings and Fixed assets Advances to be

other Basic Transport Administrative Tools tangible forwarded to

constructions Equipment Equipment Equipment and utensils in progress tangible fixed assets Total

Gross assets:

Opening balance 31 490 131 079 174 1 584 308 290 941 129 2 029 575 30 150 135 045 767

Increases - 288 273 19 651 4 058 - 616 206 - 928 188

Disposals - ( 23 047) ( 36 966) - - - ( 5 000) ( 65 013)

Write-downs - ( 423 174) ( 111 713) - - - - ( 534 887)

Transfers - 125 350 - - - ( 125 350) - -

Contributions - ( 328 959) - - - - - ( 328 959)

Closing Balance 31 490 130 717 617 1 455 280 294 999 129 2 520 431 25 150 135 045 096

Cumulative depreciation and

Impairment losses:

Opening balance 31 490 124 882 325 829 375 284 814 129 - - 126 028 133

Increase - 985 412 157 508 2 853 - - - 1 145 773

Decrease - ( 23 047) ( 31 959) - - - - ( 55 006)

Write-downs - ( 423 174) ( 111 713) - - - - ( 534 887)

Closing Balance 31 490 125 421 516 843 211 287 667 129 - - 126 584 013

Net value - 5 296 101 612 069 7 332 - 2 520 431 25 150 8 461 083

30.06.2017

Buildings and Fixed assets Advances to be

other Basic Transport Administrative Tools tangible forwarded to

constructions Equipment Equipment Equipment and utensils in progress tangible fixed assets Total

Gross assets:

Opening balance 31 490 129 618 017 1 415 828 292 411 129 1 109 928 3 379 132 471 182

Increases - 150 870 121 357 1 684 - 842 292 - 1 116 203

Disposals - ( 2 381) ( 127 670) ( 284) - - - ( 130 335)

Write-downs - ( 248 058) - ( 1 655) - - - ( 249 713)

Transfers - 97 513 - - - ( 94 134) ( 3 379) -

Closing Balance 31 490 129 615 961 1 409 515 292 156 129 1 858 086 - 133 207 337

Cumulative depreciation and

Impairment losses:

Opening balance 31 490 123 129 355 729 781 283 426 129 - - 124 174 181

Increase - 1 128 134 140 161 2 233 - - - 1 270 528

Decrease - ( 2 381) ( 96 618) ( 284) - - - ( 99 283)

Write-downs - ( 247 648) - ( 1 655) - - - ( 249 303)

Closing Balance 31 490 124 007 460 773 324 283 720 129 - - 125 096 123

Net value - 5 608 501 636 191 8 436 - 1 858 086 - 8 111 214



10. INTANGIBLE ASSETS

Changes in intangible fixed assets and corresponding accumulated depreciation and impairment losses in the semesters ended 30 June 2018 and 2017 were as follows:

Licenses Intangible assets

Rights and software in progress Total

Gross assets:

Opening balance 4 680 250 844 357 792 27 399 344 4 708 007 980

Increases 3 589 146 10 425 298 741 3 898 312

Write-downs ( 26 267) - - ( 26 267)

Capitalized financial costs - - 355 724 355 724

Closing Balance 4 683 813 723 368 217 28 053 809 4 712 235 749

Cumulative depreciation

impairment losses:

Opening balance 2 327 405 646 324 739 - 2 327 730 385

Increase 65 407 832 14 910 - 65 422 742

Closing Balance 2 392 813 478 339 649 - 2 393 153 127

Net value 2 291 000 245 28 568 28 053 809 2 319 082 622

30.06.2018

Licenses Intangible assets

Rights and software in progress Total

Gross assets:

Opening balance 4 648 216 677 347 369 45 302 548 4 693 866 594

Increases 2 676 114 - 6 317 783 8 993 897

Transfers 25 467 183 - ( 25 467 183) -

Capitalized financial costs - - 442 055 442 055

Closing Balance 4 676 359 974 347 369 26 595 203 4 703 302 546

Cumulative depreciation

impairment losses:

Opening balance 2 197 114 868 298 610 - 2 197 413 478

Increase 64 987 765 13 060 - 65 000 825

Closing Balance 2 262 102 633 311 670 - 2 262 414 303

Net value 2 414 257 341 35 699 26 595 203 2 440 888 243

30.06.2017



The gross value of intangible assets at 30 June 2018 includes essentially:

(i) The right to operate Brisa concession obtained as consideration for motorway and related infrastructures construction services in the amount of € 4 214 721 575, of which € 244 376 501 relate to the capitalization of financial expenses;

(ii) Payment to the State (Grantor) as consideration for the right to collect tolls on the CREL motorway

as from 1 January 2003, under the terms of Decree-law 314 A/2002, of 26 December – € 236 318

343;

(iii) Amount deriving from the General Agreement entered with the State and Estradas de Portugal, S.A. corresponding to changes in the Concession Bases (Decree-law 247-C/2008, of 30 December) - € 158 100 000 (Note 18);

(iv) Costs with the renegotiation of the concession contract in 1991, namely the extension of the

concession period initially established – € 101 749 989.

11. DEFERRED TAXES

Deferred tax assets and liabilities at 30 June 2018 and 31 December 2017, by underlying timing difference, were as follows:

30.06.2018 31.12.2017

Provisions for the replacement of infrastructures 68 243 706 65 063 787

Derivative financial instruments 808 584 1 121 916

Provisions not considered for tax purposes 196 053 196 053

69 248 343 66 381 756



The changes in deferred tax assets and liabilities in the semesters ended 30 June 2018 and 2017 were as follows:

12. CASH AND CASH EQUIVALENT

Cash and cash equivalents at 30 June 2018 and 31 December 2017 are made up as follows:

Within the scope of the contractual obligations assumed by BCR, the balance of bank deposits as of 30 June 2018 and 31 December 2017 included the following reserve accounts:

As the business the company may pursue is restricted pursuant to its bylaws and concession contract, but including loans and investments, and considering that the above mentioned reserve accounts may be used for such purposes, the Company considers the balances of these reserve accounts as cash and cash equivalents.

30.06.2018 30.06.2017

Opening balance 66 381 756 57 889 565

Effect on results:

Change in provisions for the replacement of infrastructures 3 179 919 4 061 124

Increase / (decrease) of financial instruments ( 79 643) ( 106 250)

Change in provisions not accepted for tax purposes - ( 16 491)

Sub-total (Note 6) 3 100 276 3 938 383

Effect on equity

Increase / (decrease) of financial instruments ( 233 689) ( 376 991)

Closing Balance 69 248 343 61 450 957

30.06.2018 31.12.2017

Cash 1 000 -

Bank deposits 149 154 321 445 811 111

Cash and cash equivalent 149 155 321 445 811 111

Bank overdrafts (Note 15) ( 20 477 065) -

128 678 256 445 811 111

30.06.2018 31.12.2017

Debt service reserve account 86 500 000 107 500 000

Reserve account for investment purposes 8 166 802 4 066 120

94 666 802 111 566 120



13. CAPITAL

The Company’s capital at 30 June 2018 is made up of 15 000 000 fully subscribed and paid up shares with

a nominal value of five Euro each.

Brisa – Concessão Rodoviária, SGPS, S.A. (BCR, SGPS) holds 15 000 000 shares, representing 100% of

the share capital.

Shareholders at the General Meeting held on 29 March 2017 decided to increase the Company's share capital from € 75 000 000 to € 86 850 000, fully paid up through the integration of part of the share premium, by increasing the nominal value of shares from € 5.00 each to € 5.79 each.

At the same General Shareholders Meeting it was subsequently decided to reduce the Company's share capital from Euro 86 850 000 to Euro 75 000 000, by releasing surplus capital and reducing the nominal value of shares from Euro 5.79 each to Euro 5.00 each.

Share premiums

The share premium resulted from the difference between: (i) the net value of assets and liabilities transferred by BAE in the year ended on 31 December 2010 for the purposes of a capital increase by contribution in kind, and (ii) the nominal value of the issued shares. According to the relevant law, this follows provisions applicable to legal reserves.

At the General Shareholders Meeting held on 29 March 2017 it was decided to incorporate part of the share premium, in the amount of € 11 850 000 into the share capital.

14. LEGAL RESERVE AND OTHER RESERVES

Legal reserve

Commercial legislation establishes that at least 5% of annual net profit must be appropriated to a legal reserve until the reserve equals at least 20% of share capital. This reserve is not available for distribution except in the event of liquidation, but it can be used to absorb losses once the other reserves have been exhausted, or to increase capital.

At 30 June 2018 and 31 December 2017 the legal reserve set up totalled € 15 000 000 in both cases.



Other reserves

At 30 June 2018 and 31 December 2017 this caption was made up as follows:

(a) This caption includes changes in the fair value of financial hedging instruments net of the tax effect (Note 11).

15. LOANS

As at 30 June 2018 and 31 December 2017, contracted loans were made up as follows:

BOND LOANS

Non-convertible bond loans at 30 June 2018 and 31 December 2017 are made up as follows:

30.06.2018 31.12.2017

Free reserves 1 760 705 5 325 129

Hedging derivatives (a) ( 1 139 870) ( 1 648 050)

620 835 3 677 079

Current Non current Non current Non current

Bond loans 7 123 193 1 395 012 494 339 591 970 1 394 382 502

Bank loans 36 153 046 431 563 340 36 050 787 449 636 794

Commercial paper 50 192 157 150 000 000 49 578 736 150 000 000

Bank overdrafts (Note 12) 20 477 065 - - -

113 945 461 1 976 575 834 425 221 493 1 994 019 296

31.12.201730.06.2018

Nominal Value Interest rate

of the issue Current Non current Current Non current Maturity Nominal

100 000 000 2 501 491 94 102 799 5 438 875 93 951 894 jan/32 Floating

300 000 000 - - 315 232 042 - abr/18 6.875%

300 000 000 2 537 782 299 322 249 8 412 692 299 137 791 abr/21 3.875%

300 000 000 - 285 394 079 1 721 106 285 491 253 abr/25 1.875%

120 000 000 16 866 119 536 975 30 699 119 449 565 jan/22 Floating

300 000 000 1 265 583 298 452 778 4 294 078 298 256 041 mar/23 2.000%

300 000 000 801 471 298 203 614 4 462 478 298 095 958 mai/27 2.375%

7 123 193 1 395 012 494 339 591 970 1 394 382 502

30.06.2018 31.12.2017



2012-2032 Issue

€ 100 000 000 bond issue carried out by BCR on 12 July 2012. This bond loan with a 19.5-year maturity, pays interest at a fixed rate of 6% in the first five years and thereafter interest indexed to the consumer price index (except housing) as from the sixth year to maturity. Repayment of principal will be made in one instalment at maturity on 12 January 2032.

2012-2018 Issue

€ 300 000 000 bond issue carried out by BCR on 2 October 2012. This bond loan with a 5.5-year maturity bore interest at a fixed rate of 6.875%. Repayment of principal was made in one instalment at maturity on 03 April 2018.

2014-2021 Issue

€ 300 000 000 bond issue carried out by BCR on 1 April 2014. This bond loan with a 7-year maturity bears interest at a fixed rate of 3.875%. Repayment of principal will be made in one instalment at maturity on 1 April 2021.

2015-2025 Issue

€ 300 000 000 bond issue carried out by BCR on 30 April 2015. This bond loan with a 10-year maturity bears interest at a fixed rate of 1.875%. Repayment of principal will be made in one instalment at maturity on 30 April 2025.

2016-2022 Issue

€ 120 000 000 bond issue carried out by BCR on 07 June 2016. This bond loan has a floating interest rate indexed to the 6-month Euribor. Repayment of principal will be made in one instalment at maturity on 7 January 2022.

2016-2023 Issue

€ 300 000 000 bond issue carried out by BCR on 22 March 2016. This bond loan with a 7-year maturity bears interest at a fixed rate of 2%. Repayment of principal will be made in one instalment at maturity on 22 March 2023.

2017-2027 Issue

€ 300 000 000 bond issue carried out by BCR on 10 May 2017. This bond loan with a 10-year maturity bears interest at a fixed rate of 2.375%. Repayment of principal will be made in one instalment at maturity on 10 May 2027.



As of 30 June 2018 and 31 December 2017 the following bond issues were listed:

The above-mentioned bond issues are part of a Euro Medium Term Note Programme, under which a maximum amount of € 3 000 000 000 may be issued.

BANK LOANS

Caption “Bank loans” at 30 June 2018 and 31 December 2017 is made up as follows:

Within the scope of the reorganization process, the Group negotiated with the European Investment Bank (EIB) the transfer to BCR of the loans contracted by BAE with the EIB. The amount of debt transferred as of 22 December 2010 totalled € 779 708 171. It was also agreed with the EIB the consolidation of 16 existing financing contracts into one sole contract, subject to floating interest rate indexed to the 6-month Euribor with extended term (this loan will be repaid in half-year instalments as from June 2011 to December 2030).

Additionally, the Company contracted derivative financial instruments associated with this loan, which are classified as hedging instruments (Note 20).

Issue

Stock

Exchange

Issue nominal

value Book value

Market value (a)

Book value

Market value (a)

Maturity

Nominal

interest rate

2012 LuxSE 300 000 000 - - 315 232 042 305 118 000 abr/18 6.875%

2014 LuxSE 300 000 000 301 860 031 329 265 000 307 550 483 335 376 000 abr/21 3.875%

2015 LuxSE 300 000 000 285 394 079 307 965 000 287 212 359 311 511 000 abr/25 1.875%

2016 LuxSE 300 000 000 299 718 361 315 711 000 302 550 119 318 855 000 mar/23 2.000%

2017 LuxSE 300 000 000 299 005 085 309 345 000 302 558 436 318 198 000 mai/27 2.375%

1 185 977 556 1 262 286 000 1 515 103 439 1 589 058 000

(a) Source: Bloomberg

30.06.2018 31.12.2017

Nominal Nominal

amount Non amount Non

borrowed Current Current borrowed Current Current Maturity Periodicity Interest rate

487 317 607 36 153 046 431 563 340 506 810 311 36 050 787 449 636 794 dec/30 Half-year Floating

30.06.2018

Amount to be settled

Repayment

31.12.2017

Amount to be settled



As of 30 June 2018 and 31 December 2017, bank loans had the following repayment schedule:

COMMERCIAL PAPER AND SHORT TERM LINES

Caption “Other loans obtained” at 30 June 2018 and 31 December 2017 is made up as follows:

At 30 June 2018 and 31 December 2017 BCR had short term credit lines and commercial paper issues with guaranteed subscription contracted with banks in a total maximum amount of € 450 000 000 and

€ 475 000 000, respectively, of which an amount of approximately € 200 000 000 in both cases were issued

as of this date. Of the total amount placed as of 30 June 2018 and 31 December 2017, €150 000 000 refer to a commercial paper programme with guaranteed subscription for a period beyond one year, thus being classified as medium and long term.

16. CUMULATIVE IMPAIRMENT LOSSES

Changes in cumulative impairment losses in the semesters ended 30 June 2018 and 2017 are as follows:

30.06.2018 31.12.2017

Up to 1 year 36 153 046 36 050 787

1 to 2 years 36 286 050 36 180 702

2 to 3 years 36 521 148 36 400 787

3 to 4 years 36 751 053 36 636 745

4 to 5 years 36 983 380 36 867 867

More than 5 years 285 021 709 303 550 693

467 716 386 485 687 581

30.06.2018 31.12.2017

Other loans

Commercial paper 200 192 157 199 578 736

Bank overdrafts

Bank overdraft lines (Note 12) 20 477 065 -

220 669 222 199 578 736

Opening Decrease Closing

balance Increase (Note 3) balance

Impairment losses:

Accounts receivable 21 984 786 372 057 ( 72 410) 22 284 433

Opening Decrease Closing

balance Increase (Note 3) balance

Impairment losses:

Accounts receivable 21 133 541 316 098 ( 90 716) 21 358 923

30.06.2017

30.06.2018



17. PROVISIONS

The changes in provisions and accumulated impairment losses in the semesters ended 30 June 2018 and 2017 are as follows:

Provisions for pending legal proceedings view to cover liabilities as estimated by the Board of Directors based on information from its lawyers, for motor accident claims, losses caused by motorway construction and labour claims. At 30 June 2018 and 31 December 2017 the total amount of claims was of € 9 722 790

and € 9 236 913, respectively. Provisions set up correspond to the Board of Directors’ best estimate of the

amount of such liabilities.

Provisions for reinstatement of infrastructures relate to the responsibility to replace the outer layer of the flexible pavements and is recognised, at the present value, through the period up to the date in which the intervention takes place. Provisions are subject to a financial update at each reporting date calculated at the average interest cost rate of the company and recorded as a financial expense. The recorded reversals relate essentially to the reassessment of the estimates for the costs to be incurred and changes in the planned schedule of the interventions in the infrastructure.

Financial

Opening Reversal revision Closing

balance Increase Use (Note 3) (Note 5) Transfers balance

Provisions:

Non current:

Pending legal proceedings 1 244 077 17 986 - - - - 1 262 063

Replacement of infrastructures 189 331 916 12 959 376 ( 889 502) ( 2 657 522) 2 382 243 ( 9 272 087) 191 854 424

Other risks and charges 220 687 - - - - - 220 687

190 796 680 12 977 362 ( 889 502) ( 2 657 522) 2 382 243 ( 9 272 087) 193 337 174

Current

Replacement of infrastructures 17 219 791 8 132 629 ( 10 650 297) - 818 052 9 272 087 24 792 262

208 016 471 21 109 991 ( 11 539 799) ( 2 657 522) 3 200 295 - 218 129 436

30.06.2018

Financial

Opening Reversal revision Closing

balance Increase Use (Note 3) (Note 5) Transfers balance

Provisions:

Non current:

Pending legal proceedings 1 273 414 - ( 65 649) - - 1 207 765

Replacement of infrastructures 166 171 545 11 763 046 ( 2 417 704) - 2 828 781 914 614 179 260 282

Other risks and charges 198 955 - - - - - 198 955

167 643 914 11 763 046 ( 2 417 704) ( 65 649) 2 828 781 914 614 180 667 002

Current

Replacement of infrastructures 23 073 083 10 440 994 ( 6 771 230) ( 3 191 188) 1 113 824 ( 914 614) 23 750 869

190 716 997 22 204 040 ( 9 188 934) ( 3 256 837) 3 942 605 - 204 417 871

30.06.2017



18. OTHER NON-CURRENT LIABILITIES


(a) This heading € includes 73 669 709 of compensation obtained from the State for the non-collection of tolls in some motorway sub-stretches located in the metropolitan areas of Lisbon and Oporto, deducted of the amount of € 46 155 772 recognised as income by BCR and BAE (up to the transfer of Brisa Concession to BCR). This amount is to be recognised on a straight-line basis until the end of the concession. In the semester ended at 30 June 2018, BCR transferred to income (caption "Other operating income and gains") the amount of € 786 112 (Notes 3 and 19).

(b) This caption corresponds to the difference between the amount received from the State, under the Global Agreement established with BCR (Note 10) and the balances pending settlement and recognised in the financial statements as of the date of the agreement. Pursuant to the contract in force, an inspection by IGF (tax inspection authority) is still pending, viewing to validate and confirm balances, to be settled in the amount specified.

30.06.2018 31.12.2017

Compensation for operating losses (a) 25 941 712 26 727 824

Financial contributions (b) 11 745 957 11 745 957

Fair value of derivative instruments (Note 20) 2 104 078 3 810 554

39 791 747 42 284 335



19. OTHER CURRENT LIABILITIES


20. DERIVATIVE FINANCIAL INSTRUMENTS

The Group has contracted a series of derivative financial instruments to minimise the risk of exposure to variations in interest rates.

Such instruments are contracted considering the risks that affect its assets and liabilities, after verifying which market instruments available are the most adequate to hedge the risks.

Such operations, which are subject to the CFO's and/or Executive Board prior approval, are continuously monitored based on relevant indicators, such as evolution of their market value, projected cash flows' and market's sensitivity to changes in the key variables that affect the structures, in order to assess their financial effect.

These financial derivative instruments are recorded in accordance with the provisions of IAS 39, being measured at their fair value considering evaluations made by financial institutions based on mathematical models, such as option pricing models and discounted cash flow models for unlisted instruments (over-the-counter instruments). These models are based essentially on market information.

30.06.2018 31.12.2017

Government and other public bodies:

Personal income tax:

Income tax withheld 120 847 35 164

Value added tax 18 694 080 13 940 380

Payments to Social Security 51 016 30 949

18 865 943 14 006 493

Accrued costs:

Fair value of derivative instruments (Note 20) 682 010 -

Remuneration payable 317 256 395 002

Group companies and related parties (Note 22) 37 810 31 246

Other 145 570 230 060

1 182 646 656 308

Deferred income:

Advanced revenues of service areas

Group companies and related parties (Note 22) 2 185 766 -

Other 671 272 560 447

Compensation for operating losses (Note 18) 1 572 225 1 572 225

Other 695 062 43 159

5 124 325 2 175 831

25 172 914 16 838 632



Derivative financial instruments used by the Company are interest rate swaps.

Such instruments are classified as hedging or trading instruments considering the provisions of IAS 39.

Hedge accounting is applicable to derivative financial instruments that are efficient as regards the effect of offsetting the variations in the fair value or cash flows of the underlying assets/liabilities. The efficiency of these operations is checked on a quarterly basis.

Cash flow hedge instruments are derivative financial instruments that hedge interest rate risk. The effective

component of the variations in the fair value of the cash flow hedges is recognised in caption “Other

Reserves”, while the non-efficient part is reflected immediately in the income statement.

Cash flow hedges

As of 30 June 2018 and 31 December 2017 the Company had contracted the following interest rate derivative instruments:

The said derivative instruments were initially contracted by BAE. Within the scope of the corporate reorganization process of the Group, the contractual position in the said instruments was transferred to the Company on 22 December 2010, as integral part of the assets and liabilities entered as contributions in kind for the capital increase carried out on the said date (Note 14).

21. CONTINGENT LIABILITIES

As of 30 June 2018 and 31 December 2017 the Company had the following bank guarantees given to third parties:

Underlying Fair value Underlying Fair value

Type of operation Maturity Counterparty amount (Notes 18 and 19) amount (Note 18)

Fixed/var. int. rate swap 15 June 2019

BBVA and

BST 25 588 235 ( 682 010) 38 382 353 ( 1 351 328)

Fixed/var. int. rate swap 15 June 2023 Caixa BI 20 833 333 ( 2 104 078) 22 916 667 ( 2 459 226)

46 421 568 ( 2 786 088) 61 299 020 ( 3 810 554)

30.06.2018 31.12.2017

30.06.2018 31.12.2017

Guarantees given:

Portuguese State (Base XX of BCR Concession Contract) 62 386 948 61 242 834

Other guarantees provided to third parties 523 496 523 496

62 910 444 61 766 331



Within the scope of the ring-fencing of BCR, a set of guarantees were provided in favour of BCR's senior creditors, which include, among other, a pledge on shares held by BCR SGPS in the share capital of BCR, and in the balances of BCR's bank accounts.

Additionally, as result of the tax execution procedures brought against BAE relating to the years ended as of 31 December 2012 and 2011 (Note 6), BCR provided guarantees to the tax authorities on September 22, 2016 and December 29, 2015 in the amounts € 30 947 514 and € 25 550 860, viewing to suspend the said proceedings.

22. RELATED PARTIES

At 30 June 2018 and 31 December 2017, balances with group companies were made up as follows:

Additionally, transactions carried out with Group and related companies in the semesters ended as of 30 June 2018 and 2017 were as follows:

Parent company: 30.06.2018 31.12.2017 30.06.2018 31.12.2017 30.06.2018 31.12.2017 30.06.2018 31.12.2017 30.06.2018 31.12.2017 31.12.2017 30.06.2018 31.12.2017

BAE

- - - 104 541 4 331 887 4 272 761 - - - - - - -

Related parties:

BRISA O&M, S.A. ("BOM") - - - - 18 866 736 18 077 250 - 1 750 280 - - - - -

BGI - Brisa Gestão de Infraestruturas, S.A. ("BGI") - - - 18 360 294 499 398 956 276 1 600 549 - - - - -

Brisa Inovação e Tecnologia, S.A. ("BIT") - 20 281 341 427 - - - 995 465 932 935 - - - - -

Via Verde - - 625 860 - - 260 611 - - - - 629 309 - -

Auto-Estradas do Atlântico, S.A. ("AEA") - 16 - - - 66 215 - - - - - 37 810 31 246

Controlauto - Controlo Técnico

Automóvel, S.A. ("Controlauto") - 10 285 - - 62 - - - - - - - -

Iteuve Portugal, Sociedade Unipessoal, Lda.

("Iteuve") - 1 750 - - - - - - - - - - -

AEDL - Auto-Estradas do Douro Litoral, S.A.

("AEDL") 11 796 5 776 - - - 154 - - - - - - -

Mcall, S.A. ("Mcall") - 947 - - - - - - - - - - -

Via Verde Portugal, S.A. ("VVS") 13 530 12 660 - - - - - - - - 4 510 - -

AEBT - Auto-Estradas do Baixo Tejo, S.A.

("AEBT") - - - - - - - - 9 9 - - -

Sicit - Sociedade de Investimento e Consultoria

em Infra-estruturas de Transportes, S.A. ("Sicit") - 177 - - - - - - - - - - -

Brisa - Áreas de Serviço, S.A. ("BAS") 5 320 634 359 657 - - - - - - - - - 2 185 766 -

José de Mello Group 11 796 - 13 894 - - - - - 9 - - - -

5 357 756 411 549 981 181 104 559 23 558 979 23 176 389 1 951 741 4 283 764 18 9 633 819 2 223 576 31 246

Outros

ativos

correntes

Other current

liabilities

(Note 19)Clients Trade payables InvestmentOther debtors

Other

creditors

Trade payables

30.06.2018 30.06.2017 30.06.2018 30.06.2017 30.06.2018 30.06.2018 30.06.2017 30.06.2018 30.06.2017

Parent company:

BAE - - 10 565 578 10 421 368 - - - - -

Related parties:

BOM - - 46 013 499 43 921 693 - - 13 054 - -

Via Verde - - 5 530 956 5 466 726 - - - - -

BGI - - 865 323 802 898 44 880 2 167 217 2 144 154 - -

BAS 8 270 497 931 455 - - - - - - -

BIT - - - 35 328 - - - 883 378 982 829

VVS 17 496 4 410 - - - - - - -

Controlauto 54 931 55 130 62 92 62 - - - -

Iteuve 9 693 11 212 - - - - - - -

Mcall 4 792 5 464 - - - - - - -

SICIT 935 599 - - - - - - -

M Dados – Sistemas de Informação, S.A. - - ( 7 280) 13 485 - - - - -

8 358 344 1 008 270 62 968 138 60 661 590 44 942 2 167 217 2 157 208 883 378 982 829

Rendered services (Note 3) services (Note 4) operating to construction service assets

Supplies and Other costs Expenses related Tangible fixed



In the semesters ended 30 June 2018 and 2017, remuneration of the members of Brisa's corporate bodies was as follows:

In the semesters ended 30 June 2018 and 2017, remuneration of key management personnel was as follows:

23. APPROVAL OF THE FINANCIAL STATEMENTS

The financial statements for the semester ended 30 June 2018 were approved by the Board of Directors on 21 August 2018.

São Domingos de Rana, 21 August 2018.

The Certified Accountant no. 62018

_______________________

João Miguel Rodrigues

30.06.2018 30.06.2017

Non-executive directors:

Fixed remuneration 85 953 105 888

Supervisory Board 48 000 -

133 953 105 888

30.06.2018 30.06.2017

Key managing personnel

Fixed remuneration 162 818 274 844

Variable remuneration: 151 307 156 997

Defined benefits 6 204 10 707

320 329 442 548



THE BOARD OF DIRECTORS

Vasco Maria Guimarães José de Mello

João Pedro Stilwell Rocha e Melo

João Pedro Ribeiro de Azevedo Coutinho

António José Lopes Nunes de Sousa

Daniel Alexandre Miguel Amaral

Michael Gregory Allen

Manuel Rebelo Teixeira Melo Ramos

Fernando Aboudib Camargo

António José Louçã Pargana

Miguel José Pereira Athayde Marques

Maria de Fátima Henriques da Silva Barros Bertoldi

José Maria Campos da Silva André



Documents

TABLE OF CONTENTSweb3.cmvm.pt/sdi/emitentes/docs/PCS69652.pdf · According to the Concession Contract concluded with the Portuguese Government, the concession will end in December