2Q16 INVESTOR RELATIONS REPORT

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São Paulo, August 12, 2016 – BRADESPAR [BM&FBOVESPA: BRAP3 (ON), BRAP4 (PN); LATIBEX: XBRPO (ON),

XBRPP (PN)] announces its results for the second quarter of 2016.

Current Ownership Structure

On June 30, 2016, BRADESPAR’s capital stock was constituted by 122,523,049 common shares and 227,024,896

preferred shares, a total of 349,547,945 shares. See the ownership structure below:

Controlling Group: Cidade de Deus – Cia. Comercial de Participações, Nova Cidade de Deus Participações S.A.,

Fundação Bradesco and NCF Participações S.A.

Free Float 22.4% Voting

98.6% Non-Voting

71.9% Total

Controlling Group 77.6% Voting

1.4% Non-Voting

28.1% Total

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Investments Structure – 06.30.2016

Formed in March 2000 – from the partial spin-off of Banco Bradesco S.A. – BRADESPAR currently has concentrated its

investments in VALE and CPFL Energia. At the end of the period, the value of its assets, minus the net debt, was

around R$ 5.0 billion.

100% V/T

BRADESPAR

Antares

Brumado Millennium Valepar

100% V/T

100% V/T

3.6 % V/T 1.7 % V/T

21.2 % V 17.4 % T

53.9% V

33.7% T

%V = % Voting Capital %T = % Total Capital

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BALANCE SHEET

ASSETS (R$ thousand)

6/30/2016 6/30/2015

CURRENT 395,855 901,377

Cash and Cash Equivalents 384,945 302,429

Dividends Receivable - Redeemable Shares - 3,759

Interest on Equity Receivable 10,790 444,859

Preferred Shares Redeemable - 150,071

Others 120 259

NON-CURRENT ASSETS 9,359,064 10,046,633

Long Term 1,286,168 1,201,608

Financial Assets Available for Sale 1,100,829 1,004,010

Recoverable Taxes 179,012 191,943

Judicial Deposits 6,327 5,655

Investments 8,072,883 8,844,999

Fixed Assets 13 26

TOTAL 9,754,919 10,948,010

LIABILITIES (R$ thousand)

6/30/2016 6/30/2015

CURRENT 35,881 1,287,811

Provision for Dividends and Interest on Equity 3,164 4,321

Debentures Payable - 1,237,863

Tax and Contributions Payable 6,262 19,218

Other Obligations 26,455 26,409

NON-CURRENT LIABILITIES 1,945,143 466,405

Provision for Income Tax and Social Contribution 463,968 431,049

Debentures Payable 1,443,745 -

Provision and Legal Obligations 37,430 35,356

SHAREHOLDERS’ EQUITY 7,773,895 9,193,794

Capital Stock 4,100,000 4,100,000

Treasury Shares (20,310) (20,310)

Profit Reserve 20,200 2,958,737

Adjustment to Equity Evaluation 3,158,195 2,693,807

Result of the Period 515,810 (327,852)

Interest on Equity and Interim Dividends - (210,588)

TOTAL 9,754,919 10,948,010

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COMMENTS ON THE COMPANY´S PERFORMANCE

The table below shows the consolidated results, in accordance with accounting practices adopted in Brazil.

Income Statement (R$ thousand)

2Q16 2Q15 Chg % 1H16 1H15 Chg %

Equity Income 212,190 273,821 -22.5% 584,537 (280,832) -

Redeemable Shares - Interest - 7,349 - - 18,610 -

Dividends from Investments 10,790 - - 10,790 - -

Operating Revenue 222,980 281,170 -20.7% 595,327 (262,222) -

Payroll Expenses (1,143) (618) 85.0% (1,903) (1,033) 84.2%

General and Administrative Expenses (1,851) (1,079) 71.5% (2,761) (2,599) 6.2%

Tax Expenses (1,062) (15,531) -93.2% (2,025) (15,531) -87.0%

Financial Revenues (Expenses) (32,366) (19,654) 64.7% (62,851) (41,318) 52.1%

Operational Result before Income Tax/Social Contribution

186,558 244,288 -23.6% 525,787 (322,703) -

Income Tax / Social Contribution (5,036) (2,899) 73.7% (9,977) (5,149) 93.8%

Results for the Period 181,522 241,389 -24.8% 515,810 (327,852) -

Operating Revenue

As an investment company, BRADESPAR’s operating revenue originates from the equity income and interest on equity

of Valepar/VALE and dividends and interest on equity from CPFL Energia S.A.

BRADESPAR recorded an operating revenue of R$223.0 million in the 2Q16, comprising R$212.2 million in equity

income from Valepar/VALE and R$10.8 million in dividends from CPFL Energia. In the first half of 2016, operating

revenue came to R$595.3 million, reflecting VALE’s performance.

Is worth to mention that, in this period, VALE achieved solid operating performance, reaching several production records

for a second quarter, including: production of 36,5 million tonnes of iron ore in Carajás; production of 78,500 tonnes of

nickel; production of 105,600 tonnes of copper; and production of 109,000 oz of gold

Financial Results

BRADESPAR’s financial expenses came to R$32.4 million in the second quarter of 2016, mainly due to interest rates of

debentures, calculated based on interbank deposit rate (CDI), which raised from 3.03% in 2Q15 to 3.37% in 2Q16,

impacted by the increase of benchmark interest rate (SELIC) in the period.

Payroll, General and Administrative Expenses

BRADESPAR’s payroll, general and administrative expenses totaled R$3.0 million in the second quarter of 2016 and

R$4.7 million in the first half of the same year, mainly due to expenses with legal and consulting services.

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-54 -4 -595 -119 27

186

282

369 307

489 463 470

220

13 133

241 182

-50 -76

-677

-237

5

308

402

632

421

637 619

1,093

603

371

466

-328

516

Results Performance (R$ million)

Second Quarter First 6 months

Results Performance

In 2Q16, BRADESPAR reported a net income of R$181.5 million. In the 1H16, net income was R$515.8 million,

reflecting, as previously mentioned, the performance shown by VALE.

*Corresponds to four months of operations.

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COMMENTS ON INVESTEES

VALE

The world's largest producer of iron ore and pellets, key raw materials for the steel industry, VALE is also the world's

largest nickel producer, with applications in the stainless steel and metal alloys industry used in the production of

aircraft, automobiles, mining and energy equipment, cell phones, batteries, special batteries for hybrid electric vehicles,

among many others. It also produces manganese, iron alloys, thermal and metallurgical coal, copper, platinum's group

metals, gold, silver, cobalt, potassium, phosphate and other fertilizer nutrients, important raw materials for the industry

and the global agriculture. To support its growth strategy, the Company also operates large logistics systems in Brazil

and in other regions of the world, including railroads, maritime terminals and ports, integrated with its mining operations.

In this context, we must highlight the S11D project, located in the southeast of Pará, which is the expansion of the iron

ore mining activity in the Complexo Minerador de Carajás. Considered a landmark among all the projects carried out by

Vale, when it begins its operation, at the end of 2016, the Company will have strengthened its leading global position in

the mining market. The project predicts the lowest cost of ore production in the world, which, combined with high-quality

product and transport strategy through exclusive ships (VALEMAX), makes VALE become a reference in this market

and it strengthens its commitment to create value for its shareholders.

VALE trades on the BM&FBOVESPA (VALE3 and VALE5), the New York Stock Exchange (NYSE) (VALE and VALE.P),

the NYSE Euronext Paris (VALE3 and VALE5), the Latibex (XVALO and XVALP).

The main highlights of VALE's performance in 2Q16 were:

Adjusted EBITDA of R$8.3 billion, 22.4% higher than the same period last year;

Net income of R$3.6 billion, 30.3% lower than 2Q15;

Investments in the execution of projects totaled US$905.0 million, US$540.0 million of which related to the

S11D project; and

Investments in maintenance of the existing operations totaled US$463.0 million.

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CPFL Energia

CPFL Energia, the largest private company in the Brazilian electric sector, is a holding which operates through its

subsidiaries dedicated to the distribution, generation and sale of electricity in the free and regulated markets.

Its shares are traded on the BM&FBOVESPA - within the Novo Mercado segment - and on the New York Stock

Exchange (NYSE), through ADRs Level III, which shows its adherence to the highest standards of Corporate

Governance, aligned with the best practices existing in Brazil and abroad.

In addition to the Novo Mercado, the shares of CPFL Energia are part of the Corporate Sustainability Index (ISE), which

brings together committed companies with the principles of transparency, accountability, sustainability and corporate

responsibility, considering the performance of economic, social and environmental aspects in medium and long term.

The company's controlling group is formed by the Investment Fund in BB Carteira Livre (Previ)'s shares, by Camargo

Corrêa and the Investment Fund in Participações Energia São Paulo (Funcesp, Petros, Sistel e Sabesprev). Of the

outstanding shares in the market (free float), 5.3% are held by BRADESPAR.

In July 2016, Camargo Corrêa accepted the proposal of State Grid International Development Limited (State Grid)

related to the acquisition of all its stake in the controlling block of CPFL Energia S.A., represented by 234,086,204

shares, for twenty-five reais (R$25.00) per share, subject to adjustments provided for in the transaction’s documents.

The signature of the Share Purchase Agreement will take place after the conclusion of a confirming due diligence and

the obtaining of applicable approvals by the competent public authorities, including Brazil's Antitrust Authority (CADE)

and the Brazilian Electricity Regulatory Agency (ANEEL).

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Capital Market

In the capital market context, BRADESPAR’s shares are listed on BM&FBOVESPA under the codes BRAP3 (ON) and

BRAP4 (PN) since its establishment. BRADESPAR’s shares are also listed on the Latibex, the Madrid Stock

Exchange’s Latin American Companies Market, in Spain, in Euros, through the Depositary Receipt Program (GDR).

BRADESPAR’s shares participates in two leading indexes: Ibovespa, which includes the most liquid companies in the

Brazilian market; and the Corporate Governance Index (IGC), composed of the companies that have committed to high

standards of corporate governance. Part of the group since 2001, when adhered to Level I of Corporate Governance of

São Paulo Stock Exchange.

Shares Performance on BM&FBOVESPA in 1H16

20

40

60

80

100

120

140

BRAP3 BRAP4 VALE3 VALE5 CPFE3 IBOV

2016 63% 77% 25% 27% 41% 19%

Prices adjusted for shareholder payments, including dividends and/or interest on equity. Source: Economatica.

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0.2 0.1 0.1 0.1 0.4 0.5 1.3 0.9 0.4 0.4 0.3 0.2 0.4 0.9 0.4 0.2 0.2

8.1 2.1 1.1 1.5 5.4

14.1

32.2

58.3

47.7

32.8 33.9 35.4 33.9 37.4

29.7 27.3

23.2

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 1H16

BRAP3 BRAP4

Liquidity

The average daily trading volume of BRADESPAR preferred shares (BRAP4), traded in 1H16 was R$ 23.2 million. The

average number of trades for BRAP4 on BM&FBOVESPA was 7,964 in the same period.

Financial Volume Average Daily Traded Shares (R$ million)

Source: Economatica.

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Premium / Discount

The market value of investments held by BRADESPAR, without considering any control's premium for the participation

in VALE, reached approximately R$ 6.0 billion on June 30, 2016. Of this amount, 81.7% corresponded to the investment

in VALE and 18.3% in CPFL Energia. The market value of BRADESPAR, in relation to the companies in which it

participates, deducting the net debt of R$ 1.1 billion, represented a discount of 41.6%.

BRADESPAR's Net Asset Value X BRADESPAR's Market Capitalization (closing prices on June 30, 2016)

BRADESPAR’s Stake

Companies Price

(R$/share)

Number of

Shares

% of

Total

Capital

Market

Value

(R$

thousand)

Market

Value

(US$

thousand)

Market

Value

(EURO

thousand)

VALE ON (1)

16.27 299,380,600 5.81% 4,870,922 1,517,516 1,375,423

VALE PNA (1)

13.03 3,547,702 0.07% 46,227 14,402 13,053

CPFL-E ON 20.59 53,464,240 5.25% 1,100,829 342,959 310,846

BRADESPAR's Total Assets Value ( A )

6,017,978

1,874,877

1,699,322

BRADESPAR's Net Debt ( B ) (2)

(1,061,824)

(330,807)

(299,832)

Cash and Cash Equivalents

382,264

119,093

107,941

Gross Debt

(1,444,088)

(449,900)

(407,773)

BRADESPAR's Net Asset Value ( C ) = ( A ) + ( B )

4,956,154

1,544,070

1,399,490

BRADESPAR's Market Capitalization ( D )

2,895,012

901,929

817,477

Common Shares (BRAP3)

7.23

122,523,049

885,842

275,980

250,139

Preferred Shares (BRAP4)

8.85

227,024,896

2,009,170

625,949

567,338

Difference between net asset value and market capitalization ( C ) - ( D )

2,061,142

642,141

582,013

DISCOUNT (3)

41.6%

(1) The number of VALE shares were calculated by considering the indirectly owned stakes in Valepar. (2) Net Debt on 06/30/16. (3) ((BRADESPAR's Market Cap)/(Asset Value + Net Debt)) - 1

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16.6% 15.1%

12.9%

9.4% 10.9%

21.9%

29.0%

41.5%

2008 2009 2010 2011 2012 2013 2014 2015

Historical Discount between BRADESPAR’s Net Asset Value and Market Capitalization

31.0% 32.5%

35.7%

42.1%

39.2% 36.8%

39.8% 41.0%

42.5%

48.3%

53.3% 55.4%

60.4% 60.5%

55.6%

52.4%

45.3%

41.6%

Note: Discount on last business day of the month.

Note: Average discount on the last business day of each month.

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DIVIDENDS AND INTEREST ON EQUITY

On April 18, 2016, the Board of Directors of BRADESPAR upheld proposal of the Board that, given the provisions of its

"Indicative Policy of Minimum Annual Remuneration", announced to its shareholders on February 26, 2016, minimum

remuneration equal to zero for the year 2016, due to market volatility, which has a direct impact on the outcome of its

investees.

285.9 240.2

293.4 255.4

318.6 285.0

333.0 308.0

266.6

99.2 143.5 99.3 88.9

256.8 342.1

127.8

272.5

81.6

2007 2008 2009 2010 2011 2012 2013 2014 2015

IOE (R$ Million) Dividends (R$ Million)

383.7 392.7 344.3

575.4 627.1

460.8 385.1 348.2

580.5

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IR CONTACT

For further information, please contact the Investor Relations Department:

Fernando Buso - CEO

Gustavo Bonetti

Daniel Picerni Sarmento

Phone: +55 11 2178-6300

Fax: +55 11 2178-6315

E-mail: bradespar@bradespar.com

Website: www.bradespar.com