Divulgação de Resultados 2010
25 de março de 2011 Pág. 1 de 1
E-
Complete Annual Financial Statements
Management Report and Statements - Article 25 (ICVM 480)
Independent Auditor’s Report
Financial Statements for the years ended
December 31, 2015 and December 31, 2014
Fiscal Council’s Report
Capital Budget Proposal
Arteris S.A.
Message from the CEO – Management Report
For Arteris, 2015 was a year marked by important initiatives that have increased the company’s efficiency and prepared it for the long-term challenges of the highway concession market. Investing has continued to be one of our main priorities, repeating what we have done in recent years thanks to the commitment of our employees. We ended the period with R$1.8 billion allocated to strategic works in the nine concessions managed by the company.
The 3,250-kilometer highway network managed by Arteris was further modernized with the investments made by the company, both in federal and state highways. Autopista Fluminense delivered Avenida do Contorno, in Niterói, offering an important contribution to the traffic flow in the metropolitan region of Rio de Janeiro. The duplication of Serra do Cafezal, in Autopista Régis Bittencourt, also received important advances with the beginning of the works to open the tunnels. In São Paulo highways, the emphasis was on delivering the revitalization of Contorno de Jaú by Centrovias.
All these results are being obtained with cost efficiency and quality assurance. The modern hiring system, especially due to the electronic auctions, have enabled the company to save R$170 million in the hiring of services and products, which represents a discount of around 10% on the amounts originally estimated in the bids. Our group also acted to renegotiate agreements, streamline processes and improve information quality. After all these efforts, we managed to maintain the growth of the company's costs below inflation.
Our goal is to continue working to develop Brazil’s highway infrastructure by assessing opportunities through transparent and productive dialogue with the regulating agencies. Upon request of the National Road Transportation Agency (ANTT), we began studies of our federal concessions related to investments estimated at R$5.2 billion provided for in the Logistics Investment Program (PIL).
Our annual results underline the company’s ability to deal with the current challenges of the Brazilian economy. Adjusted EBITDA totaled R$1.5 billion, with a margin of 64.0%. Gross toll revenue amounted to R$2.4 billion, while net income stood at R$149.3 million. Highlighting the market’s recognition of the solidity of our businesses, we raised R$750 million through a Holding Company debenture issue.
The respect for life, the main value of our company, was also a priority this year. We have improved our labor safety standards and guidelines, adopting stricter parameters than those established in the Brazilian legislation. We are fully committed to eliminating fatal accidents involving our direct and indirect employees. We have not attained that goal yet, but we are highly committed and working hard to achieve that milestone. This is an effort that transcends the Human Resources area; it requires the involvement of professionals from all areas. With road safety in mind, we developed specific action plans for each of the concessionaires. In the end, we achieved a 21% reduction in fatal accidents during the period, taking a decisive step towards the 50% reduction goal for the end of this decade.
In 2016, Arteris plans to continue investing heavily, with estimated investments of R$2.2 billion to be allocated to the company's works. The efforts to achieve cost efficiency and create synergies between the concessionaires are another priority, thus making us believe this year is crucial to our long-term strategy. The current scenario is challenging, but we know the importance of infrastructure to help the country enter a new cycle of economic growth.
David Díaz
Arteris’ CEO
MANAGEMENT REPORT
In compliance with the prevailing legislation and its Bylaws, the Management of Arteris S.A.
(“Arteris” or “Company”) hereby submits its report for the fiscal year ended December 31, 2015
for the appreciation of its investors and the market in general.
Profile
Arteris plays an important role in Brazil’s highway infrastructure sector, being responsible for
improving, extending, maintaining and managing toll roads under the concession programs of
the federal and São Paulo state governments.
Through its concessionaires, Arteris operates and manages 3,250 km of highways within the
country’s main economic centers, comprising the states of São Paulo, Minas Gerais, Paraná,
Rio de Janeiro and Santa Catarina, which are also characterized by their high population
density.
The group has nine concessionaires (four state and five federal), all of which are publicly-held
companies and wholly-owned subsidiaries of Arteris – Autovias S.A. (Autovias), Centrovias
Sistemas Rodoviários S.A. (Centrovias), Concessionária de Rodovias do Interior Paulista S.A.
(Intervias), Vianorte S.A. (Vianorte), Autopista Fernão Dias S.A. (Fernão Dias), Autopista
Fluminense S.A. (Fluminense), Autopista Litoral Sul S.A. (Litoral Sul), Autopista Planalto Sul
S.A. (Planalto Sul) and Autopista Régis Bittencourt S.A. (Régis Bittencourt).
The Company also owns 100% of Latina Manutenção de Rodovias Ltda. (Latina Manutenção)
and Latina Sinalização de Rodovias Ltda. (Latina Sinalização), which are responsible for
highway inspections, works management and maintenance, and retains a 4.68% interest in STP
– Serviços e Tecnologia de Pagamentos S.A., which pursues activities related to the electronic
toll collection system.
Economic Scenario
In 2015, Brazil’s economic performance was well below market expectations. GDP shrank by
3.8%, substantially more than the 0.2% estimated at the beginning of the year.
Arteris and the results of its business were directly affected by the overall state of Brazil’s
economy, especially in regard to inflation, interest and exchange rates, government policies, tax
policies and GDP growth.
In 2015, as the result of the domestic and international economic scenario, the Central Bank’s
Monetary Policy Committee (Copom) increased the Selic base rate from 11.75% to 14.25%, as
part of the government’s efforts to contain inflation, as detailed below.
Inflation measured by the IGP-M general market price index increased from 3.7% in 2014 to
10.5% in 2015, while the extended consumer price index (IPCA) moved up from 6.4% to 10.7%
in the same period. These indices influence the inflationary-economic environment and the
IPCA is used to calculate the adjustment of group concessionaires’ toll tariffs, thus directly
affecting the Company’s toll revenue.
Material Events
Public Tender Offer:
On April 30, 2015, the Company informed the market of its controlling shareholders’ intention to
hold a Public Tender Offer for the Acquisition of Arteris Shares for purpose of cancellation of the
Company’s registration as category A publicly held company and delisting from the Novo
Mercado segment. The process is currently under analysis of the CVM. Shareholders are
awaiting CVM’s confirmation to publish the notice and hold the offer.
Tender Offer summarized schedule:
August 25, 2015: ASM – BNP Paribas was elected to prepare the Valuation Report
September 22, 2015: Availability of the Valuation Report (range of value: R$8.74 to
R$9.55 per share)
September 23, 2015: Participes en Brasil S.L. informed it would follow the Tender Offer
procedure
March 21, 2016: Availability of the new Valuation Report comprising CVM’s
requirements related to several official letters (new range of value: R$8.86 to R$9.58
per share)
March 23, 2016: Participes en Brasil S.L. informed it would follow the Tender Offer
procedure
Suspended Axles:
In April 2015, the Truck Drivers’ Law became effective, eliminating the charge on the
suspended axles of empty heavy vehicles on the federal highways. This impact was e impact
was rebalanced by tariff adjustments in the latest contractual tariff revisions in December 2015
and February 2016. This prohibition has not been applied in state concessions from the state of
São Paulo.
Change in accounting practices:
In 2015, the Company changed the criterion for amortizing its intangible assets from the traffic
curve method to the straight line method.
Supported by the guidelines issued by the Accounting Committee Pronouncement no. 5 (CPC
5), the Company believes that the change (adoption of a straight-line amortization method),
reflects the effects of the wear and tear of its intangible assets in a more realistic manner.
Economic and Financial Performance
Gross Service Revenue
The following table shows revenue breakdown:
Arteris recorded gross revenue of R$4.0 billion in 2015, 4.5% less than in 2014, due to virtually
flat toll revenue (+0.3%), an 11.5% decline in construction revenue and a 15.2% increase in the
other revenue line.
Breakdown of Gross Service Revenue
2015 2014
Gross Revenue 2015 2014 Var%
GROSS SERVICE REVENUE 4.047.449 4.236.358 -4,5%
Toll plazas revenue 2.438.765 2.431.851 0,3%
State 1.423.392 1.419.962 0,2%
Autovias 343.262 342.833 0,1%
Centrovias 369.932 370.838 -0,2%
Intervias 388.621 385.596 0,8%
Vianorte 321.577 320.695 0,3%
Federal 1.015.373 1.011.889 0,3%
Planalto Sul 109.116 115.028 -5,1%
Fluminense 172.822 165.003 4,7%
Fernão Dias 242.129 247.026 -2,0%
Régis Bittencourt 267.866 267.148 0,3%
Litoral Sul 223.440 217.684 2,6%
Others 54.198 47.060 15,2%
Construction services 1.554.486 1.757.447 -11,5%
Toll Plaza Revenue
Toll plaza revenue remained virtually flat (+0.3%) in 2015, totaling R$2.4 billion, despite the
annual reduction in traffic, thanks to the tariff adjustments in all concessions. Some of the
federal highway adjustments were above inflation due to the rebalancing of the contracts.
The state concessions accounted for 58% of the total, moving up by 0.2% over 2014, to R$1.4
billion, while the federal highways recorded a 0.1% improvement to R$1 billion.
Breakdown of Toll Revenue
2015 2014
Tolled Traffic: The Company’s tolled traffic volume came to 680,623 thousand vehicle
equivalents in 2015, 6.3% up on 2014.
The deterioration in Brazil’s economic environment and the consequent shrinkage of GDP, especially in
regard to industrial production, led to a substantial reduction in the volume of tolled vehicles in recent
quarters. The impact of the slowdown led to a hefty decline in heavy traffic, mainly on our federal
highways, an average 70% of whose traffic consists of heavy vehicle equivalents, versus 60%
on the state highways.
Another factor contributing to the traffic downturn was the application, since April 2015, of the
Truck Drivers’ Law, which eliminated the charge on the suspended axles of empty heavy
vehicles on the federal highways and whose impact was rebalanced by tariff adjustments in the
contractual tariff revision. If this law had not been in effect, federal highway and consolidated
tolled traffic would have fallen by 4.0%.
Vehicle-Equivalents (Thousand) 2015 2014 Var%
State Concessions 204,458 213,097 -4.1%
Autovias 46,774 48,939 -4.4%
Centrovias 55,330 58,336 -5.2%
Intervias 64,967 66,937 -2.9%
Vianorte 37,387 38,885 -3.9%
Federal Concessions 476,165 513,198 -7.2%
Planalto Sul 26,462 30,185 -12.3%
Fluminense 45,934 48,653 -5.6%
Fernão Dias 150,652 164,275 -8.3%
Régis Bittencourt 133,668 148,263 -9.8%
Litoral Sul 119,449 121,823 -1.9%
Total 680,623 726,295 -6.3%
In terms of composition, 61.4% of 2015 tolled traffic in the state concessions (measured in
vehicle equivalents) consisted of heavy vehicles and 38.6% of light vehicles, with respective
ratios of 69.8% and 30.2% in the federal concessions.
Average Tariff: The following table shows average tariff trends in each of the concessionaires
and on a consolidated and same-comparison basis:
In 2015, the average consolidated tariff of Arteris’ concessionaires was R$3.58, 7.0% up on
2014.
In July 2015, the São Paulo state government authorized the annual adjustment of state
concessionaires’ tariffs for 2015, in line with the accrued period variation in the IGP-M general
market price index of 4.11%, as determined by the concession agreement. The average state
concessionaire tariff stood at R$6.96 in 2015, up by 4.5%.
In both 2014 and 2015, the federal concessionaires were granted the tariff adjustments provided
for in their corresponding concession agreements, i.e. taking into account the accrued variation
in the IPCA inflation index, any economic-financial rebalancing of the contracts, and rounding
criteria. Adjustments are made in February of each year for Autopista Fluminense and Litoral
Sul, and in December for Autopista Fernão Dias, Régis Bittencourt and Planalto Sul. The
federal concessions’ average consolidated tariff stood at R$2.13, 8.2% up on 2014.
At the close of 2015 and beginning of 2016, the ANTT authorized the Company to include in the
calculation of the tariffs that are in effect in the closing days of 2015 and will remain in effect
throughout 2016 additional increases to the full pass-through of inflation in order to remunerate
new investments (contractual amendments) for improvements/adjustments to federal highway
infrastructure to be implemented in the coming years. The new tariffs are shown in the following
table:
Average Toll Tariff (R$ / Vehicle-Equiv.) 2015 2014 Var%
State Concessions 6.96 6.66 4.5%
Autovias 7.34 7.01 4.7%
Centrovias 6.69 6.36 5.1%
Intervias 5.98 5.76 3.9%
Vianorte 8.60 8.25 4.3%
Federal Concessions 2.13 1.97 8.2%
Planalto Sul 4.12 3.81 8.2%
Fluminense 3.76 3.39 11.0%
Fernão Dias 1.61 1.50 7.1%
Régis Bittencourt 2.00 1.80 11.3%
Litoral Sul 1.87 1.79 4.5%
Total 3.58 3.35 7.0%
Concessionaries Old Tariff Nrew Tariff Var% Valid from
Autopista Fernão Dias 1.60 1.80 12.5% 12/19/2015
Autopista Planalto Sul 4.10 4.80 17.1% 12/19/2015
Autopista Régis Bittencourt 2.00 2.50 25.0% 12/29/2015
Autopista Fluminense 3.80 4.50 18.4% 2/2/2016
Autopista Litoral Sul 1.90 2.30 21.1% 2/19/2016
Electronic Collection: Revenue from toll plaza electronic payments (AVI System) in the state
concessionaires accounted for 66.8% of total revenue in 2015, versus 66.4% in 2014, while the
average ratio in the federal concessionaires was 53.2% in 2015, compared to 52.5% in 2014.
Construction Revenue
Construction revenue — an accounting representation of the Company’s investments in
intangible assets and therefore with no cash effect — declined by 11.5% over 2014 to R$1.6
billion, due to the fact that a portion of the increase in investments was related to maintenance
works that are not recorded in this line.
Other Revenue
The “other revenue” line is composed exclusively of ancillary revenue from the exploration/sale
of highway right-of-way services. In 2015, this item came to R$54.2 million, 15.2% up on 2014.
Net Service Revenue and Deductions from Revenue
Net revenue came to R$3.8 billion in 2015, 4.7% down on 2014.
Revenue deductions, composed of PIS, COFINS and ISS taxes, totaled R$219.5 million in
2015.
Operating Costs and Expenses
Total costs and expenses came to R$3.1 billion in 2015, 3.0% more than in 2014. Part of this
variation came from non-cash items, such as depreciation and amortization, which moved up by
52.2% over 2014, as a result of changes in the accounting criteria.
Cash costs totaled R$818.4 million, 8.0% up on 2014, chiefly due to period inflation, which
impacted personnel costs through the respective collective bargaining agreements for all Group
employees as well as contract terminations, and adjustments to outsourced service
agreements.
The following table gives a breakdown of operating costs and expenses:
Costs and Services Expenses (R$ Thousand) 2015 2014 Var%
Third Party Services (194,453) (213,728) -9.0%
Personnel (249,637) (219,012) 14.0%
Conservation (115,418) (104,936) 10.0%
Inspection fee (41,401) (38,773) 6.8%
Costs w ith granting authority (22,830) (22,660) 0.8%
Insurance and guarantees (24,046) (25,028) -3.9%
Directors' compensation (20,616) (19,259) 7.0%
Consumption (51,514) (49,406) 4.3%
Civil, labor and tax risks (5,286) (9,576) -44.8%
Tax expenses (2,369) (3,755) -36.9%
Transportation (42,031) (37,257) 12.8%
Other operating expenses, net (48,767) (14,613) 233.7%
Subtotal (Cash Costs) (818,368) (758,003) 8.0%
% Cash Costs / Net Revenue (excl. construction) 36.0% 33.5% 2.5 p.p.
Cost of construction services (1,554,486) (1,757,447) -11.5%
Provision for maintenance in highw ays (196,823) (145,463) 35.3%
Depreciation and amortization (524,606) (344,689) 52.2%
Total (3,094,283) (3,005,602) 3.0%
EBITDA and Adjusted EBITDA
Arteris recorded an annual operating result, as measured by EBITDA, of R$1.3 billion, 7.3%
down on 2014, while EBITDA adjusted for provisions for highway maintenance, which have no
cash effect, dipped by 3.2% to R$1.5 billion, with a margin* of 64.0% (-2.5. p.p.).
The decline in adjusted EBITDA was due to lower toll revenue, as a result of the economic
crisis, the Truck Drivers’ Law and the R$60.4 million, or 8.0%, increase in the period cash cost.
* The EBITDA Margin is based on Net Operating Revenue excluding Construction Revenue.
¹ EBITDA is Earnings before Interest, Taxes, Depreciation and Amortization, an operating performance indicator also known by its Portuguese acronym
LAJIDA. EBITDA is not a measure adopted in accounting standards and does not represent cash flow for the periods presented and therefore should not be
considered an alternative to cash flow as an indicator of liquidity. EBITDA does not have a standardized meaning and therefore cannot be compared to the
EBITDA of other companies.
² Includes adjustments related to reversals of the provision for highway maintenance (accounting pronouncement ICPC 01).
The following table shows the calculation of EBITDA and Adjusted EBITDA for the Group’s
companies in 2015:
*Excludes depreciation and amortization.
2015 2014 Var%
NET REVENUE 3,827,963 4,018,133 -4.7%
Cost and expenses (excl. depreciation and amortization) (2,569,677) (2,660,913) -3.4%
EBITDA ¹ 1,258,286 1,357,220 -7.3%
EBITDA Margin* 55.3% 60.0% -4.7 p.p.
(+) Provision for maintenance in highw ays 196,823 145,463 35.3%
Adjusted EBITDA ² 1,455,109 1,502,683 -3.2%
Adjusted EBITDA Margin 64.0% 66.5% -2.5 p.p.
EBITDA
(In thousands of Brazilian reais)
Group Companies
(R$ Thousand)
Services
Revenue
(A)
Construct
Revenue
(B)
Total (A + B)
Cost of
Services
(A)
Cost of
Construction
Service (B)
Total (A + B) EBITDA
Provision for
highways's
maintenance
Ajusted
EBITDA
Adjusted
EBITDA
M argin*
Autovias 315,661 26,200 341,861 (103,673) (26,200) (129,873) 211,988 (36,020) 248,008 78.6%
Centrovias 340,292 42,651 382,943 (117,897) (42,651) (160,548) 222,395 (51,468) 273,863 80.5%
Intervias 359,772 96,271 456,043 (110,579) (96,271) (206,850) 249,193 (32,078) 281,271 78.2%
Vianorte 295,439 13,332 308,771 (88,771) (13,332) (102,103) 206,668 (24,992) 231,660 78.4%
State Concessions 1,311,164 178,454 1,489,618 (420,920) (178,454) (599,374) 890,244 (144,558) 1,034,802 78.9%
Planalto Sul 99,973 179,400 279,373 (70,841) (179,400) (250,241) 29,132 (4,908) 34,040 34.0%
Fluminense 158,607 304,009 462,616 (92,244) (304,009) (396,253) 66,363 (6,565) 72,928 46.0%
Fernão Dias 241,624 204,206 445,830 (160,517) (204,206) (364,723) 81,107 (16,756) 97,863 40.5%
Régis Bittencourt 254,949 414,691 669,640 (131,293) (414,691) (545,984) 123,656 (10,588) 134,244 52.7%
Litoral Sul 207,160 273,726 480,886 (137,576) (273,726) (411,302) 69,584 (13,448) 83,032 40.1%
Federal Concessions 962,313 1,376,032 2,338,345 (592,471) (1,376,032) (1,968,503) 369,842 (52,265) 422,107 43.9%
Total Concessionaires 2,273,477 1,554,486 3,827,963 (1,013,391) (1,554,486) (2,567,877) 1,260,086 (196,823) 1,456,909 64.1%
Arteris Holding 0 0 0 (630) 0 (630) (630) 0 (630)
Constructors 0 304,799 304,799 0 (305,969) (305,969) (1,170) 0 (1,170)
Other companies and eliminations for consolidation 0 (304,799) (304,799) (1,170) 305,969 304,799 0 0 0
Total 2,273,477 1,554,486 3,827,963 (1,015,191) (1,554,486) (2,569,677) 1,258,286 (196,823) 1,455,109 64.0%
Net Revenue Costs and Expenses*
Financial Result
The 2015 financial result was a net financial expense of R$495.1 million, 53.6% higher than the
net expense of R$322.4 million posted in 2014.
This result was basically due to the following factors:
Financial income totaled R$37.4 million in 2015, a 29.3% improvement, chiefly due to
the higher average amount invested and the increase in interest on financial
investments tied to the CDI interbank deposit rate.
The 46.6% (R$209.8 million) increase in financial expenses, chiefly due to higher
financial charges (+41.6% or R$159.5 million) resulting from the increase in the
Company’s leverage in 2015 and the upturn in the gross debt indexing rates (TJLP, CDI
and IPCA).
Net Income
In 2015, the Company’s net income came to R$149.3 million, 67.3% down on the previous year,
mainly due to the economic slowdown that negatively impacted toll revenue, higher interest
rates and the levying of PIS and Cofins taxes as of July, which jeopardized the financial result
and, especially, the alteration to the accounting criterion that changed the way the Company
amortizes its intangible assets. It is also worth noting the increase in provisions for maintenance
related to the last maintenance cycle of the state concessions before the end of the agreements
and were also impacted by the revision of the accounting criterion of depreciation to linear. If the
review of the accounting criterion of depreciation had not been consolidated net income would
have recorded R $ 278.3 million.
The Company’s consolidated income differs from the income booked by Arteris (as the Group’s
parent company) which recorded R$ 140.1 million in 2015, the latter being the basis for
calculating the dividends to be distributed to shareholders. As described in Note 3 to the
financial statements, this difference arises from the fact that the individual statements were
prepared in accordance with accounting practices adopted in Brazil, which, in the case of Arteris
S.A., differ from IFRS, which applies to the individual financial statements only in regard to the
option to maintain the balance of deferred assets on December 31, 2008, which is being
amortized.
Financial Result (R$ Thousand) 2015 2014 Var%
Financial Income 164,738 127,375 29.3%
Interest Receivable 1,434 4,256 -66.3%
Financial Investments 151,112 122,514 23.3%
Financial Charges - Reversal of Present Value Adjustments 6,276 - 0.0%
Other Revenues 5,916 605 877.9%
Financial Expenses (659,858) (450,073) 46.6%
Financial Charges (542,529) (383,045) 41.6%
Monetary Adjustment of Concession Charges (26,961) (22,093) 22.0%
Financial Charges - Reversal of Present Value Adjustments (49,443) (26,958) 83.4%
Other Expenses (40,925) (17,977) 127.7%
Net Exchange Variation (25) 324 -107.7%
Financial Result (495,145) (322,374) 53.6%
Indebtedness
On December 31, 2015, net debt totaled R$5.7 billion, 29.1%, or R$1.3 billion, more than in
2014.
At year-end, net debt represented 4.10 times Adjusted EBITDA less payment of the fixed
concession fee in the last 12 months.
This R$1.3 billion upturn was mainly due to disbursements of BNDES credit facilities and new
debenture issues, in addition to prepayments of older operations, as detailed below:
BNDES financing: Arteris receives long-term loans from the Brazilian Development Bank
(BNDES) to finance federal concession investment programs. All five federal concessionaires
have already received approval for long-term financing lines, guaranteeing the funds needed to
implement the main contractual projects before the end of the concession.
Up to December 31, 2015, approximately R$3.5 billion in BNDES funding had been disbursed,
out of the contracted total of R$3.8 billion, leaving R$222.8 million still available.
Issue of Debentures (Holding Company): In July 2015, Arteris concluded its 3rd issue of debentures
totaling R$750 million, at an issue cost of the CDI + 2.0%, payment of semi-annual interest, and
amortization in a single installment on December 19, 2016.
Gross Debt:
Gross Debt Profile (%)
Debt
(In thousands of Brazilian reais)12/31/2015 12/31/2014 Var%
Gross Debt 6,386,403 6,052,505 5.5%
Short Term 1,961,411 1,078,249 81.9%
Long Term 4,424,992 4,974,256 -11.0%
Cash Position 728,572 1,669,688 -56.4%
Cash and equivalents 488,529 1,410,451 -65.4%
Restricted investments ¹ 240,043 259,237 -7.4%
Net Debt 5,657,831 4,382,817 29.1%
¹ Short and Long Term
On December 31, 2015, the Company’s consolidated gross debt (loans and financing plus
debentures) totaled R$6.4 billion, 48.4% of which corresponding to contracts indexed to the
TJLP (long-term interest rate), 40.1% indexed to the CDI interbank rate and 11.5% indexed to
the IPCA inflation rate.
The Company’s debt amortization schedule is shown below:
Amortization Schedule – (R$ million)
Fixed Concession Fee paid to the Concession Authority
In accordance with our concession contracts, the state concessionaires must pay the
concession authority a fixed fee in exchange for the granting of the concession. In 2015, the
total amount paid was R$75.8 million.
Highway Maintenance
In 2015, the state concessionaires disbursed R$144.1 million as payment for maintenance
carried out on their highways.
Investments
2015 was yet another year of substantial road works, which absorbed investments of R$1.8
billion, 3% down on 2014, 83% of which allocated to the federal concessionaires.
The most important construction projects receiving investments in the period are described below:
Autopista Fluminense: In 2015, the concessionaire maintained the accelerated pace of the
duplication works of Highway BR 101/RJ between the cities of Rio Bonito and Campos dos
Goytacazes, a project that began in 3Q11 after it obtained the construction permit from IBAMA,
Brazil’s environmental protection agency. The project involves 176.6 km of highway, 45.1 km of
which concluded by the end of 2015. Of the remaining 131.5 km, 78.9 km are currently
undergoing works.
In August 2015, the Company concluded the duplication works of Avenida do Contorno, in the
city of Niterói, including an extension of 2.2 km. The project increased the safety of highway
users, due to the expansion of the road’s capacity.
Autopista Fernão Dias: After having completed the implantation of the 8.1 kilometer Betim
Beltway (MG) in 2013, creating an alternative for long-distance highway traffic, which used to
pass through the city, the concessionaire concluded its main contractual works.
However, other improvements have been implemented on the highway, including the
construction of 22 km of side roads in Atibaia (SP), Extrema (MG) and Camanducaia (MG), 2.6
km of side roads in the city of Betim (MG) and the improvement of three access ways at km
887+450, km 902+000 and km 947+880.
Autopista Régis Bittencourt: The Serra do Cafezal (BR-116/SP) project, the concessionaire’s
main construction work, continues to move ahead. The Company has already concluded and
delivered 17.9 km of the duplication of a total of 30.5 km, including two interchanges. In
December 2014, the ANTT approved the necessary contractual rebalancing for the continuation
of the works, which include the construction of four tunnels, all of which in progress, and 42
bridges and overpasses (11 concluded, 22 in progress and 9 not yet started).
Other improvements are being implemented on the highway, including the conclusion of the
construction of 10.6 km of side roads.
Autopista Planalto Sul: The concessionaire’s main project is the duplication of 25.4 km of the
BR-116/PR between Curitiba (PR) and Mandirituba (PR), whose construction permit has
already been obtained from IBAMA. Of this total, 9.8 km between Curitiba and Fazenda Rio
Grande (PR) have already been concluded and freed for traffic, and the remainder, up to
Mandirituba (PR), is under construction.
In 2015, an underpass was constructed at km 128.6, in the city of Fazenda Rio Grande/PR, as
well as two raised interchanges at km 127.5 and km 131.8, in Fazenda Rio Grande (PR).
Additionally, the Vila Pompéia Interchange was concluded at km 117.7, in Curitiba/PR.
Autopista Litoral Sul: The Florianópolis Beltway project, one of the most important works in
the region, began in May 2014, immediately after IBAMA had granted the installation license for
a 14 km stretch. In May 2015, the Company obtained a rectifying Environmental License
covering a total extension of 47 km. The northern and intermediate stretches are currently
undergoing works, including one raised interchange at km 215+380 and four underpasses.
In 2015, the Concessionaire also concluded the construction of 5 km of side roads, five
overpasses and one underpass at km 169+650, in Tijucas (SC).
Autovias: In September 2014 Autovias began duplicating 13.6 km of the SP 318 between km
235 and 249, in the São Carlos region. This is a new project which will be added to the
concession agreement, resulting in a six-month extension of the concession term until May
2019, in accordance with the marginal cash flow method for the economic and financial
rebalancing of the agreement.
Intervias: In February 2016, the implementation of the second 5 km stage of the Mogi Mirim
Beltway was concluded.
The concessionaire is also duplicating the SP 147 between Mogi Mirim and Engenheiro Coelho,
a project that began in September 2014.
Added Value
In 2015, Arteris generated consolidated added value of R$1.6 billion, 5.7% down on 2014,
resulting from service revenue (R$4.0 billion) less costs related to the concessions and
construction, materials and consumer goods, third-party services, and depreciation and
amortization (R$2.3 billion), plus dividends, capitalized interest and other financial income
(R$350.8 million).
Distribution of Added Value (R$1.6 billion)
Capital Market
Arteris closed 2015 with a market capitalization of R$3.3 billion, based on the closing price of
R$9.65 per share on December 30, 2015, representing depreciation of 20.2% since the
beginning of the year. In the same period, the Bovespa Index fell by 10.6%. Under the ticker
ARTR3, the Company’s stock was traded in 100% of BM&FBOVESPA trading sessions, with
annual financial trading volume of approximately R$1.2 billion.
Shareholding Structure
The Company’s subscribed and paid-in capital was approximately R$1,033.2 million on
December 31, 2015, represented by a single class of 344,444,440 common shares.
Dividends
Shareholders are entitled to receive minimum mandatory dividends of 25% of annual net
income, adjusted in accordance with Article 202 of Brazilian Corporation Law.
The Company paid dividends of R$106.2 million on 2014 net income, corresponding to R$0.31
per share and representing a payout of 25%.
The Company did not pay interim dividends on net income for the fiscal year ended December
31, 2015. The payment of dividends for 2015 will be resolved at the Annual Shareholders’
Meeting, to be held on April 29, 2016.
Personnel
Arteris closed 2015 with 5,974 employees, 46.9% of whom in the federal concessionaires,
21.2% in the state concessionaires, 26.5% in the group’s construction companies and the
remaining 2.7% in the group’s holding company, as shown below:
Social and Environmental Responsibility - Sustainability
Arteris prioritizes developing its business in a sustainable manner, ensuring that its activities
permit the development of its employees, its neighboring communities, and society as a whole.
The Company maintains several programs focusing on promoting safety on its highways, as
well as projects geared towards traffic education, environmental preservation and the social and
cultural development of its adjacent communities.
Arteris maintains initiatives in six areas:
Safety
The Company’s goal is to reduce the total number of accidents on the Group’s highways by
50% between 2011 and 2020, in line with the UN’s own target determined in its Decade of
Action for Road Safety. In order to comply with this goal, the Company created the Strategic
Accident Reduction Group (GERAR), which is responsible for implementing studies and action
Personnel 2015 2014 Var. %
Arteris (Holding) 162 149 8.7%
State Concessions 1,264 1,356 -6.8%
Autovias 306 302 1.3%
Centrovias 271 283 -4.2%
Intervias 421 519 -18.9%
Vianorte 266 252 5.6%
Federal Concessions 2,963 2,804 5.7%
Litoral Sul 690 595 16.0%
Planalto Sul 352 264 33.3%
Fluminense 480 438 9.6%
Fernão Dias 827 874 -5.4%
Régis Bittencourt 614 633 -3.0%
Latina Manutenção 1,428 2,017 -29.2%
Latina Sinalização 157 173 -9.2%
Total 5,974 6,499 -8.1%
Turnover 4.51% 5.38% 0
plans to preserve life in traffic. Since September 2014, the Company has been holding the
Arteris Safety Month, a pioneer initiative in the highway concession sector to raise the
awareness of drivers, employees and society in general of the importance of remaining
conscientious in traffic. In 2015, the initiative raised the awareness of nearly one million people
and began with the 2nd
Arteris Safety Forum, with the presence of representatives from
transport regulation agencies, the Ministry of Health, highway police authorities, research
institutions and NGOs.
Education
Traffic humanization is the Company’s priority in the education area, exemplified by the School
Project (Projeto Escola), a 15-year initiative that prepares teachers for the adoption of traffic
safety activities with public school students. The initiative is recognized as good practice by
UNICEF (United Nations Children’s Fund). The same strategy is used to prepare these teachers
in relation to environmental issues through the Long Live Environment program (Viva Meio
Ambiente).
The Company also develops specific initiatives through the Passarela Viva (for pedestrians in
the adjacent communities), Viva Ciclista and Viva Motociclista programs in order to raise the
awareness of these users on the importance of adopting a responsible attitude in traffic.
Health
The Saúde na Boleia program has already benefited more than 100,000 truck drivers through
provision of advice on health and safety, as well as free medical exams and vaccination
programs. The objective of this initiative is to raise professional drivers’ awareness of the need
to preserve their quality of life, since they frequently lack appropriate conditions to take care of
their health. The program has a preventive approach, which encourages them to undergo
medical exams.
The Environment
Business sustainability is a priority for Arteris, influencing the way the Company carries out the
infrastructure works estimated in the concession agreements. Arteris develops projects related
to reforestation and the recovery of degraded areas, the planting of native tree seedlings and
environmental education initiatives in the surrounding communities. The Environmental
Management System is the mechanism through which Arteris and its concessionaires monitor
the execution of initiatives in this area. It also controls and recycles garbage, and maintains
agreements with several state and federal universities to control wildlife.
Cultural, social and sporting projects
The Company prioritizes the sponsorship of important sporting, cultural, social and health
projects in the regions where its concessionaires operate, and promotes partnerships with
leading cultural institutions to sponsor exhibitions by internationally renowned artists in Brazil. In
2014, it sponsored a Salvador Dalí exhibition, the most complete exhibition of his work ever to
come to Brazil. Shown in Rio de Janeiro and São Paulo, it attracted more than 1.5 million
visitors. In 2015, an exhibition of the work of Joan Miró was shown in São Paulo and
Florianópolis. The Company also formed partnerships with institutions that care for children with
special needs as well as other organizations, so that people who normally would not have
access to this type of cultural event, could attend the exhibition.
Volunteer Program
The Company’s employees are encouraged to maintain close relations with their surrounding
communities by developing a transformational approach in order to help build a more just
society. At the same time as it helps develop employees’ personal skills, the initiative also adds
value to the business and strengthens the Company’s image.
Arbitration Clause
The Company is subject to arbitration under the Market Arbitration Chamber, pursuant to the
arbitration clause in its Bylaws.
Final Considerations Relations with the Independent Auditors
In accordance with CVM Instruction 381/03, the Company hereby declares that, during the fiscal
year ended December 31, 2015, it did not hire Deloitte Touche Tohmatsu Auditores
Independentes for any services beyond those related to the external audit. In its relations with
the independent auditors, the Company seeks to evaluate conflicts of interest in regard to non-
audit-related services based on the following precepts: the auditors must not (a) audit their own
work, (b) exercise managerial functions in the Company or (c) promote the Company’s interests.
Declaration by the Board of Executive Officers Pursuant to Article 25 of CVM Instruction 480/09 of December 7, 2009, the Company’s
executive officers hereby declare that they have discussed, reviewed and are in full agreement
with (i) the opinions expressed in the report drawn up by Deloitte Touche Tohmatsu Auditores
Independentes; and (ii) the financial statements for the fiscal year ended December 31, 2015.
São Paulo, March 29, 2016.
Board of Executive Officers David Antonio Díaz Almazán Chief Executive Officer Felipe Ezquerra Plasencia Vice Chief Executive Officer and Administrative and Finance Officer Alessandro Scotoni Levy Investor Relations Officer Maria de Castro Michielin Legal Officer Angelo Luiz Lodi Executive Officer Paulo Pacheco Fernandes Executive Officer Board of Directors
Luiz Ildefonso Simões Lopes Chairman Benjamin Michael Vaughan Member David Antonio Díaz Almazan Member Eduardo de Salles Bartolomeo Independent Member Fernando Martinez Caro Member Francisco José Aljaro Navarro Member Francisco Miguel Reynés Massanet Member Josep Lluis Giménez Sevilla Member Marta Casas Caba Member Marcos Pinto Almeida Member Sérgio Silva de Freitas Independent Member
Deloitte Touche Tohmatsu
Av. Dr. José Bonifácio Coutinho Nogueira, 150 - 5º andar
Campinas - SP - 13091-611 Brasil
Tel: + 55 (19) 3707-3000
Fax:+ 55 (19) 3707-3001
www.deloitte.com.br
INDEPENDENT AUDITOR’S REPORT
To the Board of Directors and Shareholders of
Arteris S.A. São Paulo - SP
We have audited the parent company and consolidated financial statements of Arteris S.A. and
subsidiaries (“Company”), which comprise the balance sheet as of December 31, 2015, and the
statements of income, comprehensive income, changes in equity and cash flows for the year then
ended, and a summary of significant accounting policies and other explanatory information.
Management is responsible for the preparation and fair presentation of the parent company financial statements in accordance with the accounting practices adopted in Brazil, and for the consolidated financial statements in accordance with International Financial Reporting Standards (“IFRS”), issued by the International Accounting Standards Board (IASB), pursuant to the accounting practices adopted in Brazil, and for such internal controls as Management determines is necessary to enable the preparation of financial statements that are free from material misstatements, whether due to fraud or error.
Auditor’s responsibility
Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with Brazilian and international standards on auditing. These standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement.
An audit involves performance procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error.
In making those risk assessments, the auditor considers internal controls relevant to the Company’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal controls. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by Management, as well as evaluating the presentation of the financial statements taken as a whole.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Opinion on the parent company financial statements
In our opinion, the parent company financial statements referred to above present fairly, in all material respects, the financial position of Arteris S.A. on December 31, 2015, and its financial performance and cash flows for the year then ended, in accordance with the accounting practices adopted in Brazil.
© 2016 Deloitte Touche Tohmatsu. All rights reserved. 3
Opinion on the consolidated financial statements
In our opinion, the consolidated financial statements referred to above present fairly, in all material
respects, the consolidated financial position of Arteris S.A. on December 31, 2015, and its
consolidated financial performance and its consolidated cash flows for the year then ended, in
accordance with International Financial Reporting Standards (“IFRS”), issued by the International
Accounting Standards Board (IASB) and the accounting practices adopted in Brazil.
Emphasis of matter
As described in Note 3, the parent company financial statements were prepared in accordance with
accounting practices adopted in Brazil, which, in the case of Arteris S.A., differ from IFRS, which
applies to the parent company financial statements, only with respect to the option to maintain the
balance of deferred assets on December 31, 2008, which is being amortized. Our opinion on this
matter is unqualified.
Other matters
Statements of value added
We have also audited the parent company and consolidated statements of value added (DVA) for
the year ended December 31, 2015, prepared under the responsibility of the Company’s
Management, the disclosure of which is required by Brazilian Corporation Law for publicly-held
companies, and considered as additional information under the IFRS, which do not require this
disclosure. These statements were submitted to the same audit procedures previously described
and, based on our opinion, they are fairly presented, in all material respects, in line with the
financial statements taken as a whole.
Audit of figures corresponding to the prior year
The figures corresponding to the parent company and consolidated financial statement for the year
ended December 31, 2014, originally prepared prior to the reclassifications carried out in the
statements of consolidated cash flows described in Note 5, were audited by other auditors, who
issued an audit report containing an emphasis of matter paragraph regarding the fact that the parent
company financial statements were prepared in accordance with the accounting practices adopted in
Brazil which, in the case of Arteris S.A., differ from the IFRS only with respect to the option to
maintain the balance of deferred assets, which has been amortized, existing on December 31, 2009,
dated February 25, 2015. As part of our audit of the parent company and consolidated financial
statements for 2015, we have also audited the reclassifications described in Note 5, carried out to
change the consolidated financial statements of December 31, 2014. We have not been engaged to
audit, review or apply any other procedures to the parent company and consolidated financial
statements for 2014 and, therefore, we do not expresses an opinion or any other form of assurance
on the 2014 parent company and consolidated financial statements taken as a whole.
Campinas, March 29, 2016
DELOITTE TOUCHE TOHMATSU Edgar Jabbour
Auditores Independentes Engagement Partner
CRC n. 2 SP 011609/O-8 CRC n. 1 SP 156465/O-9
2
ARTERIS S.A.
(In thousands of Brazilian reais - R$)
ASSETS Note 12/31/2015 12/31/2014 12/31/2015 12/31/2014 LIABILITIES AND SHAREHOLDERS' EQUITY Note 12/31/2015 12/31/2014 12/31/2015 12/31/2014
CURRENT ASSETS CURRENT LIABILITIESCash and cash equivalents 6 127,362 109,516 488,529 1,410,451 Borrowings and financing 13 - - 234,496 198,865 Trade receivables 7 - - 153,130 154,062 Borrowings and financing - related parties 15 132,218 107,042 - - Amounts due from related parties 15 190,629 227,103 - - Debentures 14 859,166 230,372 1,726,915 879,384 Inventories - - 8,866 9,950 Trade payables 6,246 2,809 139,391 142,868 Prepaid expenses 302 3,085 18,622 15,358 Payroll and related taxes 14,776 12,164 78,487 76,815 Taxes recoverable 17,563 14,082 83,846 47,482 Taxes payable 5,975 3,886 63,663 72,748 Advances for new projects - - - - Amounts due to related parties 15 100 152 - 152 Dividends receivable 15 6,223 6,929 6,223 - Contractual guarantees - - 78,189 61,764 Restricted investments 9 - - 154,171 174,377 Inspection fee - - 3,519 2,289 Other receivables 1,543 1,267 4,977 6,806 Dividends proposed 18 33,270 27,028 33,270 27,028 Total current assets 343,622 361,982 918,364 1,818,486 Concession fees 16 - - 79,765 74,452
Provision for contingencies 17 - - - - Provision for maintenance in highways 17 - - 173,524 95,258
NON-CURRENT ASSETS Provision for investments in highways 17 - - 56,711 98,280 Restricted investments 9 - - 85,872 84,860 Interest on capital - - - - Taxes recoverable 7,506 - 10,449 - Claims received - - 3,942 18,347 Amounts due from related parties 15 1,941,910 1,143,779 - - Other payables 4,328 2,756 15,249 9,566 Prepaid expenses - - 150 3 Total current liabilities 1,056,079 386,209 2,687,121 1,757,816Contractual guarantees - 47 24 68 Deferred income tax and social contribution 8 - - 256,591 183,906 NON-CURRENT LIABILITIESEscrow deposits 17 6,266 5,113 111,437 54,103 Borrowings and financing 13 - - 2,885,688 2,716,797 Other receivables 7 - - 8,164 235 Borrowings and financing - related parties 15 1,391,395 1,124,251 - - Investments in subsidiaries and associates 10 2,593,198 2,458,045 1,053 1,052 Debentures 14 198,418 309,154 1,539,304 2,257,459 Property and equipment 11 9,621 9,173 62,414 61,486 Trade payables - - 2,824 15 Intangible assets 12 21,112 9,391 8,627,052 7,395,629 Trade payables - related parties 15 - - - - Diferido - - - - Concession fees 16 - - 108,926 163,048 Total non-current assets 4,579,613 3,625,548 9,163,206 7,781,342 Civil, labor and tax risks 17 222 - 17,517 15,198
Deferred revenue - - - 461 Deferred income tax and social contribution 8 - - 62,870 90,294 Provision for maintenance in highways 17 - - 457,361 443,244 Provision for investments in highways 17 - - 63,604 26,120 Other payables 2,390 - 11,506 599 Total non-current liabilities 1,592,425 1,433,405 5,149,600 5,713,235
EQUITYShare capital 18 1,033,198 873,822 1,033,198 873,822 Profit reserves 1,263,804 1,316,365 1,233,922 1,277,226 Valuation adjustment to equity - foreign exchange differences on capital (22,271) (22,271) (22,271) (22,271) Total equity 2,274,731 2,167,916 2,244,849 2,128,777
TOTAL ASSETS 4,923,235 3,987,530 10,081,570 9,599,828 TOTAL LIABILITIES AND EQUITY 4,923,235 3,987,530 10,081,570 9,599,828
Parent Company Parent Company
BALANCE SHEET AS AT DECEMBER 31, 2015 AND AS AT DECEMBER 31, 2014
Consolidated Consolidated
3
ARTERIS S.A.
INCOME STATEMENT FOR THE PERIOD ENDED DECEMBER 31, 2015 AND DECEMBER 31,2014
(In thousands of Brazilian reais - R$, except basic and diluted earnings per share)
Note12/31/2015 12/31/2014 12/31/2015 12/31/2014
NET OPERATING REVENUE 19 - - 3,827,963 4,018,133
COST OF SERVICES 20 - - (2,888,230) (2,812,470)
OTHER REVENUESEquity in the arnings (losseS) of subsidiaries 10 196,107 467,218 - -
GROSS PROFIT 196,107 467,218 939,733 1,205,663
OPERATING (EXPENSES) INCOME
General and administrative 20 (7,275) (3,824) (192,907) (182,086) Management compensation 15 (5,112) (6,111) (20,616) (19,259) Tax expenses (811) (2,759) (2,369) (3,755) Amortization of goodwill on investments - - - - Other operating income, net 10,489 13,089 9,839 11,968
OPERATING PROFIT BEFORE FINANCE INCOME 193,398 467,613 733,680 1,012,531
FINANCE INCOME (COSTS)
Finance income 21 274,026 143,462 164,738 127,375
Finance costs 21 (327,315) (162,525) (659,858) (450,073) Foreign exchange gain (loss), net (24) (39) (25) 324
(53,313) (19,102) (495,145) (322,374)
OPERATING PROFIT BEFORE INCOME TAX ANDO SOCIAL CONTRIBUTION 140,085 448,511 238,535 690,157
INCOME TAX AND SOCIAL CONTRIBUTIONCurrent 23 - (1,141) (189,306) (231,128) Deferred 23 - - 100,113 (2,169)
NET PROFIT FOR THE PERIOD 140,085 447,370 149,342 456,860
PROFIT ATTRIBUTABLE TOOwners of the Company 140,085 447,370 149,342 456,860
BASIC AND DILUTED EARNINGS PER SHARE - R$ 24 0.4067 1.2988 0.4336 1.3264
The accompanying notes are an integral part of these financial statements.
Parent Company Consolidated
4
ARTERIS S.A.
Individual statement of comprehensive income for theperiod ended DECEMBER 31, 2015 AND DECEMBER 31,2014(In thousands of Brazilian reais - R$)
12/31/2015 12/31/2014
Net income for the year from continuing operations 140,085 447,370 Other comprehensive income
Total comprehensive income for the period 140,085 447,370
Profit attributable ofShareholders controlling participation 140,085 447,370
The accompanying notes are an integral part of these financial statements.
5
ARTERIS S.A.
Consolidated statement of comprehensive income for theperiod ended DECEMBER 31, 2015 AND DECEMBER 31,2014(In thousands of Brazilian reais - R$)
12/31/2015 12/31/2014
Net income for the year from continuing operations 149,342 456,860 Other comprehensive income
Total comprehensive income for the period 149,342 456,860
Profit attributable ofShareholders controlling participation 149,342 456,860
The accompanying notes are an integral part of these financial statements.
6
ARTERIS S.A.
(In thousands of Brazilian reais) Valuation adjustments
to capital - PatrimônioShare Earnings foreign exchange Retained Consolidatedcapital Legal retention differences on capital earnings equity
BALANCES AT DECEMBER 31, 2013 772,417 101,425 975,225 101,405 (22,271) - 1,928,201 Capital increase 101,405 (101,405) - Distribution of additional dividends proposed (101,405) (101,405) Net income for the year - - - - 447,370 447,370 Allocation of net income Legal Reserve - 22,369 - - (22,369) - Dividends Paid - - - - (79,222) (79,222) Proposed dividends - - - - (27,028) (27,028) Retained earnings - - 318,751 - (318,751) -
- BALANCES AT DECEMBER 31, 2014 873,822 123,794 1,192,571 - (22,271) - 2,167,916
Capital increase 159,376 (159,376) - Distribution of additional dividends proposed - - Net income for the year - - - - 140,085 140,085 Allocation of net income Legal Reserve - 7,004 - - - (7,004) - Proposed dividends - - - - - (33,270) (33,270) Retained earnings - - 99,811 - - (99,811) -
- BALANCES AT DECEMBER 31, 2015 1,033,198 130,798 1,133,006 - (22,271) - 2,274,731
Additional dividend proposed
Profit reserves
INDIVIDUAL STATEMENT OF CHANGES IN EQUITY FOR THE PERIOD ENDED DECEMBER 31, 2015
7
ARTERIS S.A.
(In thousands of Brazilian reais) Valuation adjustments
to capital - PatrimônioShare Earnings foreign exchange Retained Consolidatedcapital Legal retention differences on capital earnings equity
BALANCES AT DECEMBER 31, 2013 772,417 101,425 926,596 - 101,405 (22,271) - 1,879,572
Capital increase 101,405 (101,405) - Distribution of additional dividends proposed (101,405) (101,405) Net income for the year - - - - - 456,860 456,860 Allocation of net income Legal Reserve - 22,843 - - - (22,843) - Dividends Paid - - - - - (79,222) (79,222) Proposed dividends - - - - - (27,028) (27,028) Retained earnings - - 327,767 - - (327,767) -
- BALANCES AT DECEMBER 31, 2014 873,822 124,268 1,152,958 - - (22,271) - 2,128,777
Capital increase 159,376 (159,376) - Distribution of additional dividends proposed - - Net income for the year - - - - - 149,342 149,342 Allocation of net income Legal Reserve - 6,861 - - - (6,861) - Transferencia de Reservas - (474) 474 - - - - Proposed dividends - - - - - (33,270) (33,270) Retained earnings - - 109,211 - - (109,211) -
- BALANCES AT DECEMBER 31, 2015 1,033,198 130,655 1,103,267 - - (22,271) - 2,244,849
Dividendo adicional proposto
Additional dividend proposed
Profit reserves
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE PERIOD ENDED DECEMBER 31, 2015
8
ARTERIS S.A.
STATEMENT OF CASH FLOWS FOR THE PERIOD ENDED DECEMBER 31, 2015(In thousands of Brazilian reais - R$)
RESUBMITTED
12/31/2015 12/31/2014 12/31/2015 12/31/2014CASH FLOWS FROM OPERATING ACTIVITIESProfit for the year 140,085 447,370 149,342 456,860 Adjustments to reconcile profit for the year to net cash (used in) generated by operating activities:
Depreciation and amortization 2,124 1,802 524,606 344,689 Write-off of permanent assets 1 96 15,411 27,774 Deferred income tax and social contribution - - (100,113) 2,169 Inflation adjustment and interest on concession fees - - 26,961 22,105 Income from restricted investments - - (22,931) (18,236) Interest and inflation adjustment on borrowings (46,760) (6,603) 97,099 107,214 Interest and inflation adjustment on debentures 117,347 38,321 443,605 277,108 Finance costs / (income) from discount to present value - - 43,167 26,754 Recognition (reversal) of provision for civil, labor and tax risks 222 - 6,199 10,343 Recognition (reversal) of provision for maintenance in highways - - 172,802 103,071 Equity in the earnings (losses) of subsidiaries (196,107) (467,218) - -
Decrease (increase) in operating assets: Trade receivables - - (6,997) (27,353) Amounts due from related parties (8,312) (4,360) - - Inventories - - 1,084 (2,288) Prepaid expenses 2,783 (3,026) (3,411) (6,862) Taxes recoverable 23,455 (1,151) (42,911) (11,472) Other receivables (317) 1,559 1,829 (1,115) Contractual guarantees 47 255 44 263 Escrow deposits (1,153) (307) (4,590) (33,731) Other receivables - 228 - (18)
Increase (decrease) in operating liabilities: Trade payables 2,235 7,202 49,937 (85,979) Amounts due to related parties 205 - - (2) Contractual guarantees of suppliers - (13) (15,893) 10,107 Payroll and related taxes 428 634 1,672 (3,084) Taxes payable 2,089 1,177 162,409 142,609 Income tax and social contribution paid - - (178,415) (152,365) Deferred revenue - - (461) 34 Amounts due to related parties - (49) - - Claims received - - (13,136) (21,250) Other payables (3,326) (1,591) 17,136 53 Concession fees - - (2,801) 126 Civil, labor and tax risks - - (3,880) (6,932) Payment of interest - federal - - (722,553) (349,167) Net cash (used in) generated by operating activities 35,046 14,326 595,211 811,425
CASH FLOWS FROM INVESTING ACTIVITIESPurchase of property and equipment (2,321) (5,747) (15,499) (19,515) Increase in intangible assets (10,735) (8,962) (1,773,117) (1,721,640) Restricted investments - - (189,854) (219,135) Amount redeemed from restricted investments - - 228,077 86,802 Additions to investments (386,998) (444,000) (1) - Interest on capital received 31,155 10,287 - - Dividends received 427,506 424,797 - - Net cash generated by (used in) investing activities 58,607 (23,625) (1,750,394) (1,873,488)
CASH FLOWS FROM FINANCING ACTIVITIESBorrowings and financing: Funding - - 380,709 773,255 Payments - - (183,760) (147,148) Payment of interest - - - - Debentures: Issue of debentures 754,408 300,000 861,955 1,321,138 Payment of - principal (200,000) - (719,423) (130,262) Payment of debentures - interest (147,425) (3,817) - - Payment of concession fees - - (72,969) (71,570) Payment of dividends (27,028) (202,810) (33,251) (202,810) Loans - related parties (455,762) (160,000) - - Net cash (used in) generated by financing activities (75,807) (66,627) 233,261 1,542,603
(DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS 17,846 (75,926) (921,922) 480,540
CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE YEAR 109,516 185,442 1,410,451 929,911
CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR 127,362 109,516 488,529 1,410,451
The accompanying notes are an integral part of these financial statements.
Parent Company Consolidated
9
ARTERIS S.A.
STATEMENTS OF VALUE ADDED FOR THE PERIOD ENDEDDECEMBER 31, 2014(In thousands of Brazilian reais - R$)
12/31/2015 12/31/2014 12/31/2015 12/31/2014
REVENUESServices provided - - 2,438,765 2,431,851 Revenue from construction services - - 1,554,486 1,757,447 Other revenues - - 54,198 47,060
- - 4,047,449 4,236,358
INPUTS PURCHASED FROM THIRD PARTIESCost of services provided - - (317,550) (259,792) Cost of construction services - - (1,554,486) (1,757,447) Materials, energy, outside services and other - - (69,626) (164,172) Cost of concession - - (115,290) (110,514) Cost of provision for maintenance in highways - - (196,823) (145,463) Other - - (54,997) (14,490)
- - (2,308,772) (2,451,878)
GROSS VALUE ADDED - - 1,738,677 1,784,480
DEPRECIATION AND AMORTIZATION (2,124) (1,802) (524,606) (344,689)
NET VALUE ADDED GENERATED (RETAINED) (2,124) (1,802) 1,214,071 1,439,791
VALUE ADDED RECEIVED THROUGH TRANSFEREquity in the earnings (losses) of subsidiaries 196,107 467,218 - - Finance income 274,026 143,462 164,738 127,375 Dividends received 8,034 6,830 8,034 78,426 Capitalized interest - - 174,759 6,830 Other 2,448 6,323 3,229 7,093
480,615 623,833 350,760 219,724
TOTAL VALUE ADDED TO BE DISTRIBUTED 478,491 622,031 1,564,831 1,659,515
DISTRIBUTION OF VALUE ADDEDPersonnel and payroll charges: Salaries 5,365 2,274 184,626 149,929 Benefits 129 248 51,121 42,157 Severance Pay Fund (FGTS) 150 200 15,045 12,291 Taxes and contributions: Federal (including tax on financial transactions - IOF) 1,762 8,188 222,254 359,081 State 3 25 135 356 Municipal - - 124,062 123,541
Others 11,932 - Lenders: Interest 82,387 32,037 550,817 386,964 Capitalized interest BNDES - - 109,532 78,426 Capitalized interest Debentures - - 20,970 - Aluguéis 24 (2) 24,977 11,506
Others 53,770 5,760 100,018 38,404 Rentals Other 194,816 125,931 (44,257) - Shareholders: - - 44,257 - Interest Capitalized interest 33,270 106,251 33,270 106,251 Dividends 106,815 341,119 116,072 350,609 Profit for the year
478,491 622,031 1,564,831 1,659,515
The accompanying notes are an integral part of these financial statements.
Parent Company Consolidated
Arteris S.A. and
Subsidiaries
Parent Company and Consolidated
Financia Statements for the Year
Ended December 31, 2015
Deloitte Touche Tohmatsu Auditores Independentes
ARTERIS S.A. AND SUBSIDIARIES
FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2015 AND
INDEPENDENT AUDITOR’S REPORT ON THE FINANCIAL STATEMENTS
TABLE OF CONTENTS
1. OPERATIONS ........................................................................................................................... 10
2. CONCESSIONS ......................................................................................................................... 11
3. BASIS OF PREPARATION ...................................................................................................... 22
4. SIGNIFICANT ACCOUNTING POLICES .............................................................................. 24
5. RESTATEMENT OF THE STATEMENTS OF CASH FLOWS ............................................. 35
6. CASH AND CASH EQUIVALENTS ....................................................................................... 38
7. TRADE RECEIVABLES ........................................................................................................... 38
8. DEFERRED INCOME TAX AND SOCIAL CONTRIBUTION ............................................. 39
9. RESTRICTED INVESTMENTS ............................................................................................... 41
10. INVESTMENTS IN SUBSIDIARIES AND ASSOCIATES .................................................... 41
11. PROPERTY AND EQUIPAMENT ........................................................................................... 44
12. INTANGIBLE ASSETS ............................................................................................................ 46
13. BORROWINGS AND FINANCING......................................................................................... 49
14. DEBENTURES .......................................................................................................................... 52
15. RELATED-PARTY TRANSACTIONS .................................................................................... 58
16. CONCESSION FEES ................................................................................................................. 63
17. PROVISIONS............................................................................................................................. 66
18. EQUITY ..................................................................................................................................... 68
19. REVENUES ............................................................................................................................... 68
20. COSTS AND EXPENSES BY NATURE ................................................................................. 70
21. FINANCE INCOME (COSTS) .................................................................................................. 71
22. STATEMENTS OF CASH FLOWS .......................................................................................... 72
23. RECONCILITION OF INCOME TAX AND SOCIAL CONTRIBUTION ............................. 73
24. EARNINGS PER SHARE ......................................................................................................... 74
25. FINANCIAL INSTRUMENTS.................................................................................................. 74
25. SEGMENT REPORTING .......................................................................................................... 77
26. GUARANTEES AND INSURANCES ...................................................................................... 80
27. EVENTS AFTER THE REPORTING PERIOD ....................................................................... 81
28. MATERIAL FACTS .................................................................................................................. 83
Arteris S.A. and Subsidiaries
10
ARTERIS S.A. AND SUBSIDIARIES
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2015
(Amounts in thousands of Brazilian reais - R$, unless otherwise stated)
1. OPERATIONS
Arteris S.A. (“Company”) has its registered office and principal place of business at Avenida
Presidente Juscelino Kubitschek, 1.455 - 9º andar, in the city of São Paulo, state of São Paulo,
Brazil. The Company’s parent company and consolidated financial statements for the year
ended December 31, 2015 include the Company and its subsidiaries (collectively referred to as
“Arteris Group” and individually as “Group entity”). The Company was established on
November 9, 1998 and is primarily engaged in:
• Execution by means of management, contracting or subcontracting of construction works,
including ancillary or complementary services, except the supply by the Company of
merchandise outside the location where the services are provided.
• Conducting of studies, calculations, projects, tests and supervision related to engineering and
civil construction activities.
• Performance of infrastructure works in general, including, without restriction, construction
services, earthworks in general, signaling, reinforcement, improvement, recovery, maintenance
and conservation of highways, and engineering consultancy in general.
• Direct operation and/or operation in consortiums of businesses relating to public construction
works and/or services in the infrastructure sector in general, by means of any agreement mode,
including, but not limited to, public-private partnerships, authorizations, permissions and
concessions.
• Operation and maintenance of transportation infrastructure in general.
• Holding of equity interests in other companies that develop the activities previously mentioned.
Arteris, through its subsidiaries, mainly state concessionaires, has a solid cash position, robust
capital structure and special funding sources to implement its business plan.
The Company allocates the resources generated by operating activities to meet its working
capital needs. Additionally, it accesses the capital markets and raises loans and financing with
Brazil’s major financial institutions and development agencies to complete its cash needs.
Cash generation, added to the Company’s creditworthiness, besides the funds raised through
long-term financing lines is appropriate to comply with its short-term liabilities recorded under
current liabilities, which includes the financing amortization and to maintain an appropriate
leverage level for long-term liabilities.
Once its subsidiaries’ revenue projections in the medium and long terms indicate upward and
sustainable levels through the toll traffic involvement and annual tariff increases, at the same
time the work plan is supported by the loan with the Brazilian Development Bank (BNDES)
and funds raised in the capital markets by means of the issue of infrastructure debentures or
other securities in its concessionaires and through the Company itself, Management believes
Arteris S.A. and Subsidiaries
11
that the Company and its subsidiaries have conditions to honor their current short and medium
term commitments.
On April 30, 2015, the controlling shareholder Participes em Brasil S.L. informed its intention
to hold a Public Tender Offer for the Acquisition of Arteris S.A. Shares with a view to
cancelling the Company’s registration as a category A publicly-held company and delisting it
from the Novo Mercado. The launch of the offer is contingent upon registration with the
competent regulatory agencies.
On December 31, 2015, the Company was continuing to comply with all the requirements
before the competent regulatory agencies, as described in Note 28.
The parent company and consolidated financial statements were approved by the Board of
Directors on March 29, 2016.
2. CONCESSIONS
In conformity with its corporate purposes, as at December 31, 2015, the Company holds
interests in highway concessionaires in the State of São Paulo and in federal highway
concessionaires.
State concessionaires
Autovias S.A. (“Autovias”)
Autovias is a corporation with its registered office in the city of Ribeirão Preto, State of São
Paulo, Brazil, at Anhanguera Highway, km 312.2, and started its operations on September 1,
1998 to operate, under a concession through August 31, 2018, the highway network connecting
the cities of Franca, Batatais, Ribeirão Preto, Araraquara, São Carlos and Santa Rita do Passa
Quatro and respective access routes, under the terms of the concession agreement entered into
with the São Paulo State Highway Department (DER/SP) No. 18/CIC/97/Lot 10.
By means of Addendum 19/14 of January 16, 2015, the São Paulo State Transportation
Regulatory Agency (“ARTESP” or “Granting Authority”) authorized the rebalance of the
economic and financial adequacy of the concession agreement, which was granted by
extending the concession term for another 3 months and 19 days without changing the
concession fee. Therefore, the concession operation period was extended to December 18,
2018. This term can be extended or reduced by means of an internal administrative process,
which must be concluded before the aforementioned effectiveness period starts, pursuant to
Resolution ARTESP/1 of March 25, 2013.
Autovias S.A. entered into an agreement with the São Paulo State Transportation Regulatory
Agency (“ARTESP” or “Granting Authority”) to include a new project in the concession
agreement - the duplication of 14 kilometers of the SP-318, between km 253 and 249,
involving estimated investments of R$91 million. The inclusion of the works in the agreement
and the latter’s economic and financial rebalancing will be executed through the Marginal Cash
Flow methodology, by extending the concession term of Autovias S.A. by six months, which
should end in May 2019.
Autovias assumed commitments to implement the works resulting from the concession, with
the main projects of such works already completed, as follows:
Arteris S.A. and Subsidiaries
12
SP 255 - Antônio Machado Sant’anna Highway:
• Implementation of the second lane in the stretch between kilometers 2.8 and 48.35;
• Implementation of additional lanes along the entire stretch between kilometers 48.35 and
77.
SP 318 - Engenheiro Thales de Lorena Peixoto Júnior Highway:
• Implementation of additional lanes between kilometers 257.8 and 280.
SP 330 - Anhanguera Highway:
• Implementation of side lanes in Ribeirão Preto (17.2 kilometers).
SP 334 - Cândido Portinari Highway:
• Complementation of the duplication of the stretch between kilometers 322 and 337;
• Implementation of the second lane in the stretch between kilometers 337 and 348;
• Implantation of the second lane in the stretch between kilometers 358 and 395.5.
SP 345 - Engenheiro Ronan Rocha Highway:
• Implementation of the second lane and repaving of the stretch between kilometers 10 and
36;
• Implementation of side lanes between kilometers 30 and 35, on the right side, and between
kilometers 33 and 35, on the left side.
Centrovias Sistemas Rodoviários S.A. (“Centrovias”)
Centrovias is a corporation with its registered office in the city of Itirapina, State of São Paulo,
Brazil, located at Washington Luis Highway, km 216.8, South Lane. It began operations on
June 9, 1998 under a Highway Concession Agreement signed with the Highway Department
(DER), regulated by State Decree No. 42,411 of October 30, 1997, and its exclusive objective
is to operate, under a concession, the highway system that connects the cities of São Carlos to
Cordeirópolis, Itirapina to Jaú, and Jaú to Bauru.
By means of Addendum 11 of December 21, 2006, ARTESP authorized the rebalance of the
economic and financial adequacy of the concession agreement, which was granted by
extending the concession term in another 12 months without changing the concession fee.
Therefore, the concession operation period was extended to June 19, 2019.
Centrovias assumed commitments to implement the works resulting from the concession, with
the main projects of such works already completed, as follows:
SP 225 - Engenheiro Paulo Nilo Romano and Comandante João Ribeiro de Barros Highways:
• Implementation of the second lane in the stretch between kilometers 91 + 429 and 177 +
400;
Arteris S.A. and Subsidiaries
13
• Implementation of the second lane in the stretch between kilometers 183 + 850 and 235 +
040.
Concessionária de Rodovias do Interior Paulista S.A. (“Intervias”)
Intervias is a corporation with its registered office in the city of Araras, State of São Paulo,
Brazil, located at Anhanguera Highway, km 168, South Lane. It was founded on May 28, 1999
and began operating on February 18, 2000 under a Highway Concession Agreement signed
with the State Highway Department (DER/SP 19/CIC/98), regulated by State Decree No.
42,411 of October 30, 1997. The purpose of the agreement is to operate, under a concession,
the highway system that connects the cities of Itapira, Mogi-Mirim, Limeira, Piracicaba,
Conchal, Araras, Rio Claro, Casa Branca, Porto Ferreira and São Carlos - Lot 6. The work
under the concession encompasses performance, management and inspection of the delegated
services, including operating services, conservation and expansion of the system,
complementary and non-delegated services, besides the acts required for compliance with the
object, in the manner provided by the concession agreement signed.
Under Addendum 14/06, of December 21, 2006, ARTESP authorized the revision of the
concession agreement of Intervias to ensure its financial and economic balance. As a result of
such revision, the concession period was extended for an additional 95 months without
changing current fixed concession fees. Therefore, the concession operation period was
extended to January 16, 2028.
A resolution taken by ARTESP’s Managing Board, in the exercise of the powers conferred
upon it by law, approved the inclusion in the physical and financial schedule of the concession
agreement, of work item 02 06.01.50 - SP 147 – implementation of side roads and return
connections in the industrial district of Itapira – KM 46+250 – East/West. The economic and
financial imbalance arising from the inclusion referred to above, calculated in line with the
marginal cash flow methodology, totaled R$1,053 thousand in favor of the Company, in net
present value - reference date July 1997. The estimated contractual extension for the
rebalancing of the agreements is two months and fifteen days. The concession operation was
extended to April 1, 2028.
Intervias originally assumed commitments to implement the works resulting from the
concession, with the main projects of such works already completed, as follows:
SP 147 - Engenheiro João Tosello Highway:
• Duplication of the highway in the stretch between kilometers 41.36 and 54 and between
kilometers 62.45 and 106.32.
SP 191 – Wilson Finardi Highway:
• Duplication of the highway in the stretch between kilometers 43.8 and 44.9, 45.6 and 46.9
and 49.7 and 74.72.
SP 352 - Comendador Virgolino de Oliveira Highway:
• Duplication of the highway in the stretch between kilometers 162.45 and 185.17.
SP 165/330 - Anhanguera Highway - Araras Beltway
Arteris S.A. and Subsidiaries
14
• In accordance with Addendum 06/02 and third readequacy of the work schedule of
10/08/2002, a stretch comprising 4.67 kilometers of highway, known as Araras Beltway, was
built at SP 165/330, from Km 165,225 of SP 330 - Anhanguera Highway - to Km 42,300 of SP
191 - Wilson Finardi Highway.
Vianorte S.A. (“Vianorte”)
Vianorte is a corporation with its registered office in the city of Sertãozinho, State of São
Paulo, Brazil, located at Attílio Balbo Highway, km 327.5. It started operations on March 6,
1998 under a Highway Concession Agreement signed with the São Paulo State Highway
Department (DER/SP 009/CIC/97/Lot 05), with the purpose of operating, under a concession
until March 2018, the highway system made up of the following state highways: SP-330
Anhanguera Highway, SP-322 Attílio Balbo Highway/Armando Salles de Oliveira Highway,
SP-328 Alexandre Balbo Highway/northern periphery of Ribeirão Preto and SP-325/322
Avenida dos Bandeirantes.
By means of Addendum 15/14 of January 16, 2015, ARTESP authorized the rebalance of the
economic and financial adequacy of the concession agreement, which was granted by
extending the concession term estimated in another 17 days without changing the concession
fee. Therefore, the concession operation period was extended to March 23, 2018. This term can
be extended or reduced by means of an internal administrative process, which must be
concluded before the aforementioned effectiveness period starts, pursuant to Resolution
ARTESP/1 of March 25, 2013.
Vianorte assumed commitments to implement the works resulting from the concession, with
the main projects of such works already completed, as follows:
SP 322 Attílio Balbo Highway/Armando Salles de Oliveira Highway
• Duplication of the stretch between kilometers 343 + 500 and kilometers 390 + 500 -
Sertãozinho/ Bebedouro;
• Duplication of the stretch between kilometers 307 + 500 and kilometers 325 + 910 -
Contorno Viário Sul (Southern Beltway);
• Construction of access/return connections;
• Construction of pedestrian overpasses between kilometers 334 + 860 and 337 + 790 –
Sertãozinho;
• Construction of service roads between kilometers 333 + 160 and 343 + 480;
• Expansion of the connection with the state highway SP 325/322 kilometer 325 + 910
(junction);
• Construction of the transposition works over the local stream Córrego Santa Elisa at
kilometer 345 + 100.
SP 328 - Alexandre Balbo Highway
• Duplication of the stretch between kilometers 323+130 and 337+010;
Arteris S.A. and Subsidiaries
15
• Construction of connections in kilometers 326+220 / 330+720 / 334+710 / 335+160 –
superior overpass (PSU).
SP 330 - Anhanguera Highway
• Construction of a pedestrian overpass at kilometer 380 - São Joaquim da Barra;
• Construction of a user support base in Orlândia at kilometer 366 + 150;
• Construction of a connection with Avenida Lara Nilza Raffaini Cação at kilometer 319 +
650.
SP 325/322 - Avenida dos Bandeirantes – Ribeirão Preto
• Construction of a pedestrian overpass at kilometer 8 + 550;
• Construction of steel gallery at kilometer 6 + 400;
• Construction of connection at kilometer 8 + 300.
As a result of these concession agreements, the state concessionaires have recognized the rights
to use and operate, accounted for in intangible assets as concession rights, against “concession
fees”, in liabilities, as mentioned in notes 11 and 15, respectively.
As set out in the concession agreements of these concessionaires, tolls are adjusted in July,
based on the variation of the General Market Price Index (IGP-M) through May 31.
As a result from ARTESP’s Managing Board of July 27, 2011, the Concession Authority
prepared and the Company agreed, in December 2011, with the Modifying Amendment -
TAM, which establishes the change of the toll adjustment index from the General Market Price
Index - IGP-M to the Extended National Consumer Price Index - IPCA, in order to standardize
the toll adjustment system, maintaining the annual periodicity and the adjustment reference
month. The change of the adjustment index will entail an annual contractual revision with the
Concession Authority for verification of the existence of economic imbalance arising from the
use of the new index, which may determine the imbalance in favor of the Company or of the
Concession Authority, through the change of the concession period or another form mutually
defined between the parties. The TAM clauses became effective on January 1, 2012 and were
subject to the authorization of the State Secretary of Logistics and Transportation. This
amendment was approved on June 28, 2012 and became effective as of July 1, 2013.
On June 27, 2013, the extraordinary resolution of ARTESP’s Managing Board regarding the
toll tariff adjustment was published in the Diário Oficial do Estado. To sum up, the resolution
authorizes adjusting the concessionaires’ toll tariffs as of July 1, 2013 by the General market
Price Index (IGP-M), but with no pass-through of inflation to users. The Managing Board
authorized the charging of tariffs for air lift axles of heavy vehicles and the reduction of
variable concession fee percentages since July 2013, except for the payments made in
November 2013 and suggests measures for rebalancing the concession contracts. Such
measures shall be evaluated on an individual basis, and resolved on by the Secretary of
Transport, and approved by the granting authority.
Exceptionally, between July and September, November and December 2013, the variable
concession fee was calculated based on 1.5% of gross revenue to offset the non-pass-through
Arteris S.A. and Subsidiaries
16
of inflation to tariffs as of July 1, 2013, as published on July 27, 2013 in the Diário Oficial do
Estado, proceedings No. 015.147/2013 and registration No. 234.316/13.
On December 14, 2013, ARTESP’s Managing Board extended, for indefinite term, the
previously granted authorization to withhold and discount 50% of the amount due as variable
concession fee (which corresponds to 1.5% of the concessionaire’s revenue). This extension
does not include the payments made in November 2013 related to the variable concession fee
of October 2013.
On June 28, 2014, the extraordinary resolution of ARTESP’s Managing Board regarding the
toll tariff adjustment was published in the Diário Oficial do Estado. To sum up, the resolution
authorized adjusting the concessionaires’ toll tariffs as of July 1, 2014 by the IPCA Index, with
an adjustment of 5.17% for Autovias, 5.04% for Centrovias, 4.67% for Intervias and 5.58% for
Vianorte, which did not correspond to the IPCA rate variation in the period. The Company
does not agree with the São Paulo state government’s unilateral decision, announced by
ARTESP, and it is taking the measures to guarantee its rights.
On September 19, 2014, the subsidiary Centrovias was granted an injunction from the Court of
Appeals of São Paulo to fully adjust its toll tariffs. The adjustment index to be applied is 6.37%
and is in compliance with the IPCA rate variation between June 2013 and May 2014. Tariffs
were adjusted as of that date, at 12:00 a.m.
At the end of the concession periods, all reversible assets, rights and privileges related to the
operation of the highway systems transferred to the concessionaires or implemented by them
will be handed over to the Concession Authority. The handover will be free of charge and
automatic, with the assets in perfect conditions of operation, use and maintenance, and free
from any encumbrances or charges. The concessionaires will be entitled to compensation for
the unamortized or undepreciated balance of works or assets whose construction or purchase,
duly authorized by the Concession Authority, have occurred in the last five years of the
concession periods, as long as carried out to ensure the continuity and upgrading of the services
included in the concession.
The state concessionaires estimate the amounts shown below, as at December 31, 2015 and
2014, to meet the requirements to make investments and carry out recovery and maintenance
works through the end of the concession agreements. These amounts are subject to changes due
to contract adaptations and periodic revisions of cost estimates over the concession period, and
are verified at least once a year:
Autovias Centrovias Intervias Vianorte
Forecast
from
Forecast
from
Forecast
from
Forecast
from
2016 - 2019 2016 - 2019 2016 - 2028 2016 - 2018
Infrastructure improvements 101,927 2,059 388,864 3,959 496,808
Special upkeep work 169,238 82,712 194,890 54,339 501,179
271,165 84,771 583,754 58,298 997,988
Nature of costs
12.31.2015
Total
Arteris S.A. and Subsidiaries
17
Investment estimates were broken down as mentioned in Note 3 “Recognition of intangible
assets.”
Regardless of the maintenance and conservation necessary to maintain the appropriate service
level throughout the concession period, the state concessionaires are required to hand over the
highway systems in good conditions, properly adjusted at the time of the handover, and
guaranteed additional useful life of six years of the structures in general, especially the
pavement. During this period, subsequent to the handover, no structure recovery and/or repair
services should be required due to the maintenance carried out designed to preserve the
structure of the highways.
Federal concessionaires
Autopista Planalto Sul S.A. (“Planalto Sul”)
Planalto Sul is a corporation with its registered office in the city of Rio Negro, State of Paraná,
located at Avenida Afonso Petschow, 4040 - Industrial District. It was founded on December
19, 2007 and its sole purpose is to engage in public concession services for the highway lot
BR-116/PR/SC, along the stretch between Curitiba and the border between the States of Santa
Catarina and Rio Grande do Sul, object of the bidding process corresponding to lot 02, in
conformity with Bid Notice No. 006/2007, published by the National Ground Transportation
Agency (ANTT), including public works such as recovery, maintenance, monitoring,
conservation, operation, expansion and improvements.
Planalto Sul is fully operational since February 22, 2009, date of the beginning of operation of
its last toll plaza on BR-116/km 134 - PR. The concessionaire assumed the following
commitments to implement the works resulting from the concession:
• 25.4 kilometers of highway duplication;
• 48.3 kilometers of third lane;
• 10.2 kilometers of side routes;
• Construction of nine pedestrian overpasses;
• Construction of five toll plazas;
• Construction of nine operational service bases (BSOs);
• Implantation and overhaul of truck weighting stations;
• Recovery and maintenance of the entire extension of the highway.
Autopista Fluminense S.A. (“Fluminense”)
Nature of costs
Autovias
Forecast from
2015 - 2018
Centrovias
Forecast
from 2015 -
2019
Intervias
Forecast
from 2015 -
2028
Vianorte
Forecast
from 2015 -
2018 Total
Infrastructure improvements 121,544 42,152 454,661 5,694 624,051
Special upkeep work 178,278 97,309 187,983 86,061 549,631
299,822 139,462 642,644 91,755 1,173,682
Arteris S.A. and Subsidiaries
18
Fluminense is a corporation with its registered office in the city of São Gonçalo, State of Rio
de Janeiro, Brazil, located at Avenida São Gonçalo, 100 - Unit 101. It was founded on
December 19, 2007 and its sole purpose is to engage in public concession services for highway
lot BR-101/RJ, encompassing the stretch between the border of the states of Rio de Janeiro and
Espírito Santo - Presidente Costa e Silva Bridge, object of the bidding process corresponding to
lot 04, in conformity with Bid Notice No. 004/2007, published by the ANTT, including public
works such as recovery, maintenance, monitoring, conservation, operation, expansion and
improvements.
Planalto Sul is fully operational since August 31, 2009, date of the beginning of operation of its
last toll plaza on BR-101/km 252 - PR. The concessionaire assumed the following
commitments to implement the works resulting from the concession:
• 176.6 kilometers of highway duplication;
• 3.8 kilometers of side routes;
• 28.3 kilometers of branch and peripheral roads;
• Construction of 17 pedestrian overpasses;
• Construction of five toll plazas;
• Construction of seven operational service bases (BSOs);
• Implantation and overhaul of truck weighting stations;
• Recovery of the entire extension of the highway.
Autopista Fernão Dias S.A. (“Fernão Dias”)
Fernão Dias is a corporation with its registered office in the city of Pouso Alegre, State of
Minas Gerais, Brazil, located on BR-381 Highway, km 850.5 – North Lane. It was founded on
December 19, 2007 and its sole purpose is to engage in public concession services for highway
lot BR 381-MG/SP, encompassing the stretch between Belo Horizonte and São Paulo, object of
the bidding process corresponding to lot 05, in conformity with Bid Notice No. 002/2007,
published by the ANTT for a term of 25 years counted from February 15, 2008, including
public works such as recovery, maintenance, monitoring, conservation, operation, expansion
and improvements.
Fernão Dias is fully operational since September 9, 2010, date of beginning of operation of its
last toll plaza area on BR-381/km 65, SP. The concessionaire assumed the following
commitments to implement the works resulting from the concession:
• 88.8 kilometers of third lane;
• 94.26 kilometers of side routes;
• 8.3 kilometers of branch and peripheral roads;
• Construction of 50 pedestrian overpasses;
• Construction of eight toll plazas;
• Construction of 12 operational service bases (BSOs);
• Implementation and overhaul of truck weighting stations;
• Recovery of the entire extension of the highway.
Autopista Régis Bittencourt S.A. (“Régis Bittencourt”)
Arteris S.A. and Subsidiaries
19
Régis Bittencourt is a corporation with its registered office in the city of Registro, State of São
Paulo, Brazil, located at SP 139 Highway, 216. It was founded on December 19, 2007 and its
sole purpose is to operate highway lot BR-116 – SP/PR, encompassing the stretch between São
Paulo and Curitiba, object of the bidding process corresponding to lot 06, in conformity with
Bid Notice No. 001/007, published by the ANTT, in the form of a 25-year public service
concession that began on February 14, 2008, with no extension of the concession period being
permitted, including public works such as recovery, maintenance, monitoring, conservation,
operation, expansion and improvements.
Régis Bittencourt is fully operational since May 18, 2009, date of the beginning of operation of
its last toll plaza on BR-116/km 542 - SP. The concessionaire assumed the following
commitments to implement the works resulting from the concession:
• 30.5 kilometers of highway duplication;
• 30 kilometers of third lane;
• 55 kilometers of side routes;
• 26.4 kilometers of branch and peripheral roads;
• Construction of 51 pedestrian overpasses;
• Construction of six toll plazas;
• Construction of nine operational service bases (BSOs);
• Implementation and overhaul of truck weighting stations;
• Recovery of the entire extension of the highway.
Autopista Litoral Sul S.A. (“Litoral Sul”)
Litoral Sul is a corporation with its registered office in the city of Joinville, State of Santa
Catarina, Brazil, located at Rua Ministro Calógenas, 343. It was founded on December 19,
2007, and its sole purpose is to engage in public concession services for highway lot BR-
116/BR-376/PR and BR-101/SC, encompassing the stretch between Curitiba and Florianópolis,
object of the bidding process corresponding to lot 07, in conformity with Bid Notice No.
003/2007, published by the ANTT, for a 25-year period, including public works such as
recovery, maintenance, monitoring, conservation, operation, expansion and improvements.
Litoral Sul is fully operational since June 17, 2009, date of the beginning of operation of its last
toll plaza on BR-101/km 221 - SC. The concessionaire assumed the following commitments to
implement the works resulting from the concession:
• 30 kilometers of third lane;
• 79.7 kilometers of side routes;
• 94.7 kilometers of branch and peripheral roads;
• Construction of 39 pedestrian overpasses;
• Construction of five toll plazas;
• Construction of nine operational service bases (BSOs);
• Implementation and overhaul of truck weighting stations;
• Recovery of the entire extension of the highway.
Arteris S.A. and Subsidiaries
20
As set out in the concession agreements of these concessionaires, tolls are adjusted in February
for Fluminense and Litoral Sul and in December for Planalto Sul, Fernão Dias and Régis
Bittencourt, based on the variation in IPCA [Extended National Consumer Price Index].
At the end of the concession periods, all reversible assets, rights and privileges related to the
operation of the highway systems transferred to the concessionaires or implemented by them
will be handed over to the Concession Authority. The handover will be free of charge and
automatic, with the assets in perfect conditions of operation, use and maintenance, and free
from any encumbrances or charges. The concessionaires will be entitled to compensation for
the unamortized or undepreciated balance of works or assets whose construction or purchase,
duly authorized by the Concession Authority, have occurred in the last five years of the
concession periods, as long as carried out to ensure the continuity and upgrading of the services
included in the concession.
As the federal models for concession agreements are non-onerous and consider the lowest toll,
the federal concessionaires will not pay to the Concession Authority any fixed and/or variable
concession fee for the right to operate such lots.
The main commitment made by the federal concessionaires as a result of the concession
agreements is the payment to the ANTT of the inspection fees intended to cover expenses on
inspecting the concession over the entire period. The nominal amounts of the inspection fees
are as follows:
The annual inspection fees are adjusted based on the same index and at the same date as the
basic toll.
In addition to the inspection fee paid to ANTT, the commitments made by the federal
concessionaires as a result of the concession agreement are:
• The federal concessionaires must fully assume the risk arising from errors in the
determination of quantitative amounts for performance of projects and services set out in the
Highway Concession Program – PER.
• The federal concessionaires fully assume the risk arising from damages to the highway
derived from causes that should be covered by insurance, pursuant to Chapter III, Title V, of
the auction notice.
• The federal concessionaires fully assume the risk arising from variations in the costs of
their raw materials, labor and financing.
ConcessionaireAnnual
amount
Amount in the
concession period
Planalto Sul 1,846 31,690
Fluminense 2,665 45,749
Fernão Dias 7,916 135,891
Régis Bittencourt 8,436 144,818
Litoral Sul 6,424 110,279
27,287 468,427
Arteris S.A. and Subsidiaries
21
• The federal concessionaires fully assume the risk arising from the settlement of any
environmental liabilities within the highway’s domain area, the triggering event of which
occurs after the date the concession agreement is signed.
• The bylaws of the federal concessionaires provided for the requirement to go public within
two years after the concession agreement beginning date, set for February 15, 2010. The
petition to register the publicly-traded corporation with the Brazilian Securities and Exchange
Commission (CVM) was granted on March 29, 2010.
• The federal concessionaires must annually submit their financial statements to the ANTT
and publish them.
The federal concessionaires estimate the amounts shown below, as at December 31, 2015 and
2014, to meet the requirements to make investments and carry out recovery and maintenance
works through the end of the concession agreements. These amounts are subject to changes due
to contract adaptations and periodic revisions of cost estimates over the concession period, and
are verified at least once a year:
Investment estimates were broken down as mentioned in Note 3 “Recognition of intangible
assets.”
The subsidiary concessionaires Regis Bittencourt, Litoral Sul, Fernão Dias and Fluminense,
jointly “Concessionaires”, entered into “Terms of Adjustment of Conduct (TACs)” with the
National Ground Transportation Agency (ANTT), as a result of administrative proceedings
sanctioning possible non-compliances institutes by the ANTT between the beginning of
concessions and September 22, 2014.
As a result of these terms, the concessionaires will invest the equivalent of R$139.9 million in
new works not provided for in the concession agreement, involving improvements, ensuring
greater safety and comfort for users, this amount to be distributed as follows: Fernão Dias -
R$28.2 million, Fluminense - R$31.2 million, Régis Bitencourt - R$29 million and Litoral Sul
- R$51.5 million.
Planalto Sul Fluminense Fernão DiasRégis
BittencourtLitoral Sul Total
Infrastructure improvements 282,911 934,119 290,519 1,066,223 526,998 3,100,770
Recoveries/Maintenances 267,868 399,762 817,814 645,959 580,983 2,712,386
Total 550,780 1,333,881 1,108,333 1,712,182 1,107,981 5,813,156
Nature of costs
Forecast from 2016 to 2033
12.31.2015
Nature of costs Planalto Sul Fluminense
Fernão
Dias
Régis
Bittencourt Litoral Sul Total
Infrastructure improvements 438,435 1,165,844 469,491 1,399,384 769,578 4,242,732
Recoveries/Maintenances 249,832 372,845 762,749 602,465 541,865 2,529,755
Total 688,267 1,538,689 1,232,240 2,001,849 1,311,442 6,772,487
12.31.2014
Forecast from 2015 to 2033
Arteris S.A. and Subsidiaries
22
The Company is defining with the ANTT the works that will be part of this adjustment
agreement and, after this definition, these investments will be assessed based on independent
experts’ report to determine when to recognize the intangible asset between two groups: (a)
investments that generate potential additional revenue; and (b) investments that do not generate
potential additional revenue.
With regard to the subsidiary Planalto Sul, the Company announces that it is still negotiating to
enter into a TAC with ANTT under similar conditions in the coming months, but it is still
presenting justifications and administrative defenses in non-compliance procedures.
3. BASIS OF PREPARATION
Statement of compliance (in regard to IFRS and CPC standards)
The parent company financial statements have been prepared in accordance with the
accounting practices adopted in Brazil, and are identified as Parent Company.
The consolidated financial statements have been prepared in accordance with International
Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board
(IASB) and accounting practices adopted in Brazil.
The accounting practices adopted in Brazil comprise those included in the Brazilian
Corporation Law and the technical pronouncements, guidance and interpretations issued by the
Accounting Pronouncements Committee (CPC) and approved by the Brazilian Securities and
Exchange Commission (CVM).
The parent company financial statements present the maintenance of the effects of the
amortization of deferred charges existing at the date of transition to IFRSs, in accordance with
accounting practices adopted in Brazil. Therefore, this parent company information is not
considered as being in conformity with IFRS, which require the recognition of deferred charges
in profit or loss, as incurred.
The Company’s Management presents all the material information of the parent company and
consolidated financial statements, which corresponds to the information used by the Company
in its management.
Measurement basis
The parent company and consolidated financial statements have been prepared on the historical
cost basis, unless otherwise indicated.
Functional and presentation currency
The parent company and consolidated financial statements are presented in reais (R$), which is
the Company’s functional currency. All financial statements presented have been rounded to
thousands of reais, unless otherwise indicated.
Use of estimates and judgments
The preparation of financial statements requires Management to make judgments, estimates
and assumptions that affect the application of accounting policies and the reported amounts of
assets, liabilities, revenues and expenses. Actual results may differ from these estimates.
Arteris S.A. and Subsidiaries
23
The information on uncertainties as to assumptions and estimates that have a significant risk of
resulting in a material adjustment within the next year is related to the following aspects:
determination of rates for discount to present value used in measuring certain short- and long-
term assets and liabilities, determination of provisions for maintenance, determination of
provisions for investments arising from concession agreements whose economic benefits are
diluted in toll rates, provisions for tax, civil and labor risks, losses on accounts receivable, and
preparation of projections for test of realization of deferred income tax and social contribution
that, although reflecting the best estimate of the management of the Company and its
subsidiaries, related to the likelihood of future events, may present variations in relation to
actual data and amounts.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to
accounting estimates are recognized in the year in which the estimate is revised and in any
future years affected.
The information on critical judgments and estimates related to accounting policies adopted that
have effects on the amounts recognized in the individual and consolidated financial statements
is described below:
Accounting for concession agreements
In accounting for concession agreements, as required by the Accounting Pronouncements
Committee’s Technical Interpretation ICPC 01, the Company performs analyses that involve
Management’s judgment, mainly in regard to the application of the interpretation of concession
agreements, determination and classification of improvement and construction expenditures as
intangible assets, and assessment of future economic benefits for purpose of determining the
timing of recognition of intangible assets generated in concession agreements.
Timing of recognition of intangible assets
The Company’s management assesses the timing of recognition of intangible assets based on
the economic features of the concession agreements, mainly segregating investments into two
groups: (a) investments that generate potential for additional revenue; and (b) investments that
do not generate potential for additional revenue:
(a) Investments that generate potential for additional revenue: are recognized only when the
costs of provision of construction services related to the infrastructure expansion/improvement
are incurred.
(b) Investments that do not generate potential for additional revenue: are estimated
considering the total amounts of concession agreements and carried at present value at the
transition date, as mentioned in Note 16.
Determination of annual amortization of intangible assets arising from concession agreements
The Company recognizes the effect of the amortization of intangible assets arising from
concession agreements limited to the related concession period. Until December 31, 2014, the
calculation was made based on the pattern in which economic benefits are consumed, which
normally occurred according to the traffic demand curve. Therefore, the amortization rate was
determined by means of periodic technical and economic studies that sought to reflect the
projected highway traffic growth and the generation of future economic benefits arising from
the concession agreement. As of January 1, 2015, the Company started to recognize the
Arteris S.A. and Subsidiaries
24
amortization in profit or loss on a straight-line basis, prospectively, based on the concession’s
remaining term, since this method best reflects the consumer’s pattern of future economic
benefits incorporated into the asset.
Determination of construction revenues
In accordance with CPC 17 - Construction contracts, when the Company contracts construction
services, it must recognize construction revenue realized at fair value and the related costs
changed into expenses related to the construction service contracted. The Company’s
management assesses issues related to the primary responsibility for contracting these services,
even in the cases when services are outsourced and costs are incurred in managing and
monitoring the construction works of Arteris’ subsidiaries. All assumptions described are used
for purposes of determining the fair value of the construction activities.
Provision for maintenance related to concession agreements
The provision for maintenance, repair and replacements in highways is calculated based on the
best estimate of the expenditure required to settle the obligation at present value at the end of
the reporting year, against the expense for maintenance or restoration of the infrastructure to a
specified level of operation. The present value liability should be progressively recognized and
accrued to cover payments to be made during the execution of the works.
4. SIGNIFICANT ACCOUNTING POLICES
The accounting policies described below have been consistently applied in these individual and
consolidated financial statements for the year ended December 31, 2015.
The main accounting policies adopted by the Company and its subsidiaries in the preparation
of the financial statements are set out below:
Basis of consolidation
Business combinations
Acquisitions as of January 1, 2009
For the year ended December 31, 2015, there were no transactions qualifying as business
combination.
Acquisitions prior to January 1, 2009
As part of the transition to IFRSs and CPCs, the Company elected not to restate business
combinations prior to January 1, 2009. In regard to acquisitions prior to January 1, 2009,
merged concession represents the amount recognized under previous accounting policies. This
merged concession was allocated as part of the concession intangible assets and is amortized
under the criteria described in Note 4.4.
Consolidation principles
The consolidated financial statements include the balances of the Company and its subsidiaries
in which the Company directly or indirectly controls 100% of the voting shares, described
below. Investments in subsidiaries, intercompany balances and transactions have been
eliminated on consolidation.
Arteris S.A. and Subsidiaries
25
The list below presents the interests in the subsidiaries included in the consolidation:
(a) Latina Manutenção, established in 2005, has its registered office in the city of Ribeirão
Preto, State of São Paulo, Brazil, located at Anhanguera Highway, km 312.2, and is engaged in
the conservation and operation of construction, management and maintenance activities in the
highways managed by the Company’s subsidiaries.
(b) Latina Sinalização, established in 2008, has its registered office in the city of Ribeirão
Preto, State of São Paulo, Brazil, located at Anhanguera Highway, km 312.2, and is engaged in
the provision of traffic signaling installation and maintenance, and related services. Latina
Sinalização started its operations in the first quarter of 2009.
(c) Arteris Participações S.A., established in 2015, has its registered office at Avenida
Presidente Juscelino Kubitschek, 1.455 - 9º andar, Vila Nova Conceição, in the city and state
of São Paulo, and is engaged in holding equity interests in other general partnerships or
businesses as partner, shareholder or quotaholder, and may represent domestic or foreign
companies. Arteris S.A transferred 49% of its interest in Intervias to Arteris Participações.
The Company also holds 4.68% of the capital of STP - Serviços e Tecnologia de Pagamentos
S.A., engaged in the development of business related to the electronic toll collection system at
national level, which is carried at cost, as mentioned in Note 9.
The operations of each of the highway concessionaires, main commitments and other
information are disclosed in Note 2.
4.1 Financial assets
Financial assets are classified into the following specified categories: assets at fair value
through profit or loss, held-to-maturity investments, available-for- sale financial assets, and
loans and receivables. The classification depends on the nature and purpose of the financial
assets and is determined at the time of initial recognition.
12.31.2015 12.31.2015 12.31.2014
Autovias - 100% 100%
Centrovias - 100% 100%
Intervias 49% 51% 100%
Vianorte - 100% 100%
Planalto Sul - 100% 100%
Fluminense - 100% 100%
Fernão Dias - 100% 100%
Régis Bittencourt - 100% 100%
Litoral Sul - 100% 100%
Latina Manutenção (a) - 100% 100%
Latina Sinalização (b) - 100% 100%
Arteris Participações (c) - 100% -
Total/voting capital
Indirect Interest Direct Interest Direct Interest
Subsidiary
Arteris S.A. and Subsidiaries
26
The Company recognizes financial assets classified in the category “loans and receivables”, as
described below:
Loans and receivables
This classification includes non-derivative financial assets with fixed or determinable payments
that are not quoted in an active market. They are recognized in current assets, except for
maturities greater than 12 months after the end of the reporting period, which are classified as
non-current assets.
The financial assets of the Company and its subsidiaries comprise cash and cash equivalents
(Note 6), trade receivables (Note 7), escrow deposits and other receivables, and the main
criteria adopted are as follows:
a) Cash and cash equivalents
Comprise basically cash on hand and in banks and other highly liquid short-term investments,
readily convertible to a known amount of cash and subject to an insignificant risk of changes in
value, and expected to be used in a period shorter than 90 days.
b) Short-term investments
Basically represented by Bank Certificate of Deposit, debentures and quotas from investment
funds, with maturity greater than 90 days, and are classified as restricted to financing with
future maturity or Management's intention of making investments. Financial assets are
classified into a specific category as financial assets at amortized cost. The classification
depends on the nature and purpose of the financial assets and is determined at the time of initial
recognition. All regular way purchases or sales of financial assets are recognized and
derecognized on a trade date basis.
c) Trade receivables
Stated at their realizable amounts at the end of the reporting period, recognized based on their
original invoice amounts and not discounted to present value due to their short-term maturities
and immaterial effect on the financial statements. The allowance for doubtful debts is
recognized, when necessary, based on estimated losses.
4.2 Property and equipment
Stated at cost of acquisition and/or construction, plus interest capitalized during the
construction period, when applicable, for qualifying assets. Depreciation is calculated using
the straight-line method, at the rates stated in note 11, limited, when applicable, to the
concession period.
4.3 Deferred charges
Technical Pronouncement CPC 43 (R1) – First-time adoption of technical pronouncements
CPC 15 to CPC 41, determines that the maintenance of the balance of deferred charges applies
only to individual financial statements prepared in accordance with accounting practices
adopted in Brazil. Therefore, these balances were eliminated in the consolidated financial
statements to align them to the international standards (IFRS).
4.4 Intangible assets
Arteris S.A. and Subsidiaries
27
Intangible asset arising from concession agreements
The Company recognized an intangible asset related to the right to charge for the use of the
state concession infrastructure, measured at fair value on initial recognition. Subsequent to
initial recognition, the intangible asset is measured at cost, which includes borrowing costs
capitalized, less accumulated amortization and impairment losses.
Until December 31, 2014, the amortization of intangible assets was recognized in profit or loss
by projecting the traffic demand curve to the end of the concession period. As of January 1,
2015, the amortization is now recognized in profit or loss on a straight-line basis, based on the
concession’s remaining term, as of these date these assets are available for use, since this
method now reflects the consumer’s pattern of future economic benefits incorporated into the
asset.
Goodwill that has been allocated to concession rights, as well as those that have not been
directly allocated to the concession, or other assets and liabilities that have the economic
benefit limited in time (defined term), in view of concession right with finite useful life, is
included in intangible assets in the consolidated financial statements and is amortized under the
same criteria described in the previous paragraph.
4.5 Impairment of tangible and intangible assets with finite useful lives
At the end of each reporting period, the Company and its subsidiaries review the carrying
amount of their tangible and intangible assets to determine whether there is any indication that
those assets have suffered an impairment loss. If any such indication exists, the recoverable
amount of the asset is estimated in order to determine the extent of the impairment loss, if any.
As these assets refer basically to concessions, the Company does not estimate the recoverable
amount of an asset individually, but the recoverable amount of its assets as a whole based on
their value in use.
In assessing value in use, the estimated future cash flows are discounted to their present value
using a pre-tax discount rate that reflects current market assessments of the time value of
money and the risks specific to the asset for which the estimates of future cash flow estimates
have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its
carrying amount, the carrying amount of the asset is reduced to its recoverable amount. An
impairment loss is recognized immediately in profit or loss.
4.6 Borrowing costs
Borrowing costs directly attributable to the acquisition, construction or production of
qualifying assets, which are assets that necessarily take a substantial period of time to get ready
for their intended use, are added to the cost of those assets, until such time as the assets are
substantially ready for their intended use.
Investment income earned on the temporary investment of specific borrowings pending their
expenditure on qualifying assets is deducted from the borrowing costs eligible for
capitalization.
All other borrowing costs are recognized as a reduction and amortized for the term of the
agreements.
Arteris S.A. and Subsidiaries
28
4.7 Financial liabilities
a) Classified as debt or equity
Debt and equity instruments are classified as either financial liabilities or as equity in
accordance with the substance of the contractual arrangements.
b) Borrowings and financing
At the contracting date, they are carried at fair value, less transaction costs incurred, and are
subsequent measured at amortized cost using the effective interest method.
Arteris S.A. and Subsidiaries
29
c) Concession fees
Correspond to fixed installments to be paid to the Concession Authority, discounted to present
value at the rate of 5% per year, as described in Note 16.
Subsidiaries Autovias, Centrovias, Intervias and Vianorte discount to present value the balance
in line item “Concession fees”, recognized in current and non-current liabilities, based on the
average rates of finance charges contracted at the time the transactions were originated.
The balancing item of discount to present value is “Intangible assets”, where the concession
right is recognized. The discount to present value is reversed as a balancing item of line item
“Finance costs” over the concession period.
d) Obligation from the exploration rights
It corresponds to obligations arising from the right of use and exploration of the granite and
gneiss mine in accordance with the exploration agreement. These obligations primarily refer to
fixed installments in accordance with the original contractual value, adjusted to present value,
as from the beginning of the exploration agreement at the rate of 5% per year plus adjustment
to inflation and interests until the date of the balance sheets. The rate used for calculation of
the discount to present value was defined by the Management based on the average interest
rates from third-party funding on that date. The counterparty of discount to present value was
recorded under “Exploration rights” (intangible). The discount to present value is reversed as a
balancing item of line item “Finance costs” over the concession period.
4.8 Income tax and social contribution - current and deferred
Income tax and social contribution are calculated in accordance with the criteria established by
prevailing tax legislation.
Current taxes
The provision for income tax and social contribution is calculated on taxable profit for the year.
Taxable profit differs from profit as reported in the income statement because of items of
income or expense that are taxable or deductible in other years and items that are never taxable
or deductible. The provision for income tax and social contribution is calculated individually
for each company based on rates in effect at the end of the reporting period.
Deferred taxes
Deferred income tax and social contribution assets are recognized for tax loss carryforwards
and temporary differences between the carrying amounts of assets and liabilities and the
corresponding tax bases, when applicable, considering a 25% rate for income tax and a 9% rate
for social contribution.
Deferred income tax and social contribution liabilities are recognized based on discounts to
present value arising from concession fees, and from adjustments related to changes in
accounting policies, as mentioned in Note 8.
Arteris S.A. and Subsidiaries
30
4.9 Leases
Leases carried out by the Company as lessee, in which a significant part of the ownership risks
and rewards is retained by the lessor are classified as operating leases. Operating lease
payments (net of any incentive from the lessor) are recognized in the income statement on a
straight-line basis over the lease term.
Leases in which the Company and its subsidiaries retain substantially all risks and rewards of
ownership are classified as finance leases. Finance leases are capitalized in the balance sheet at
the inception of the lease at the lower of the fair value of the leased asset and the present value
of the minimum lease payments.
Each lease payment is allocated between the liability and finance charges so as to achieve a
constant rate of interest on the remaining balance of the liability. The related obligations, less
finance charges, are classified in current and non-current liabilities over the agreement terms.
Property and equipment items acquired under finance leases are depreciated over their
economic useful lives or over the lease agreement terms, when these are shorter.
4.10 Provisions
Provisions are recognized when the Company has a present obligation (legal or constructive) as
a result of a past event, it is probable that the Company will be required to settle the obligation,
and a reliable estimate can be made of the amount of the obligation.
The provisions for lawsuits are recognized when the Company has a present or constructive
obligation as a result of a past event, it is probable that an outflow of resources will be required
to settle the obligation, and a reliable estimate of the obligation can be made. They are
adjusted through the end of the reporting period for estimated probable losses, considering their
nature and supported by the opinion of the legal counsel of the Company and its subsidiaries.
The bases and nature of the provisions for civil, labor and tax risks are described in Note 17.
4.11 Liabilities discounted to present value
For certain liabilities, Management assesses and recognizes the effects of discount to present
value taking the time value of money and the uncertainties associated thereto into
consideration. The liabilities subject to discount to present value, as well as the main
assumptions used by Management for their measurement and recognition are as follows:
• Provision for investments in highways: arising from estimated expenditures to fulfill
contractual obligations of the concessions whose economic benefits are already being flown to
the Company and, therefore, recognized against the concession intangible asset. The
measurement of the related present values was made under the discounted cash flow method,
considering the dates of the estimated outflow of resources to settle the obligations (estimated
for the whole concession period) and discounted using the rate of 6.35% p.a. at December 31,
2015 and 2014. Management reviews the discount rate periodically. The determination of the
discount rate used by Management is based on the free-risk interest rate since the projected
flows of obligations were based on their nominal amounts at December 31, 2015 and 2014 and
do not consider additional cash flow risks.
• Provision for maintenance in highways: arising from estimated expenditures to fulfill
contractual obligations of the concession related to the use and maintenance of highways at
pre-established levels of utilization. The measurement of the related present values was made
Arteris S.A. and Subsidiaries
31
under the discounted cash flow method, considering the dates of the estimated outflow of
resources to settle the obligations and discounted using the rate of 6.35% p.a. at December 31,
2015 and 2014. Management reviews the discount rate periodically. The determination of the
discount rate used by Management is based on the free-risk interest rate since the projected
flows of obligations were based on their nominal amounts at December 31, 2015 and 2014 and
do not consider additional cash flow risks.
• Concession fees: arising from obligations incurred by the Company related to concession
rights. The measurement of the related present values was made under the discounted cash
flow method, considering the dates of the estimated outflow of resources to settle the
obligations and discounted using the rate of 5% p.a. The determination of the discount rate
used by Management is based on the free-risk interest rate, and should be consistently adopted
from the initial recognition through the realization of the obligations.
The nominal balances and the present value of current and non-current liabilities, at the end of
the reporting period, are as follows:
(*) Includes the variable portion, as mentioned in Note 16.
Current
Provision for investments in highways – nominal 61,333 100,002
Provision for investments in highways at present value 56,711 98,280
Effect of discount to present value (4,622) (1,722)
Provision for maintenance in highways - nominal 178,476 99,089
Provision for maintenance in highways at present value 173,524 95,258
Effect of discount to present value (4,952) (3,831)
Concession fees - nominal (*) 81,872 76,389
Concession fees at present value (*) 79,765 74,452
Effect of discount to present value (2,107) (1,937)
Non-current
Provision for investments in highways – nominal 66,151 30,220
Provision for investments in highways at present value 63,604 26,120
Effect of discount to present value (2,547) (4,100)
Provision for maintenance in highways - nominal 530,536 526,111
Provision for maintenance in highways at present value 457,361 443,244
Effect of discount to present value (73,175) (82,867)
Concession fees - nominal (*) 119,300 182,525
Concession fees at present value (*) 108,926 163,048
Effect of discount to present value (10,374) (19,477)
12.31.2015 12.31.2014
Arteris S.A. and Subsidiaries
32
The recompilation of balances to their nominal amounts at the reporting date due to passage of
time is recognized as finance costs in the income statement.
4.12 Revenue recognition
Construction contracts qualified and classified as construction services
Revenue related to construction or improvement services established in the concession
contracts is recognized in accordance with the stage of conclusion of the works performed.
Revenue from operations or services is recognized in the fiscal year in which the services are
rendered.
Arteris S.A. and Subsidiaries
33
Revenues from collection of tolls or tariffs resulting from concession rights
These revenues are measured by fair value of the consideration received or to be received,
discounted of any estimated deductions. The revenue is recognized in the fiscal year when the
public assets, which are object of the concession, are utilized by users.
4.13 Finance revenues and expenses
They are substantially represented by interest and inflation adjustment resulting from financial
investments, escrow deposits, borrowings and financing, debentures and liabilities with
creditors due to the concession and effect of discount to present value.
4.14 Dividends and interest on equity
The proposal for payment of dividends made by the Company’s Management, which is
included in the installment equivalent to the minimum mandatory dividends, is recorded as
liabilities under the “Proposed dividends” line because it is considered a legal obligation
envisaged in the Company’s Bylaws, as disclosed in Note 18.
4.15 Statements of Value Added
Its aim is to show all wealth created and distributed by the Company in a given fiscal year,
being presented in compliance with the Brazilian Corporation Law, as part of its financial
statements, not being mandatory in accordance with IFRS.
The Statement of Value Added was prepared based on the accounting information that serves
as basis to the preparation of the financial statements, observing the provisions set forth in
Technical Pronouncement CPC 09 – Statement of Value Added. In its first part, the statement
shows the wealth created by the Company, represented by revenues (gross revenue from sales,
including taxes, other revenues and the effects of provision for doubtful accounts), raw
materials acquired from third parties (costs from sales and acquisitions of materials, energy and
services from third parties, including taxes levied at the moment of acquisition, the effects of
loss and recovery of assets, and depreciation and amortization) and by the value added received
from third parties (equity accounting, financial revenues, and other revenues). The second part
of the statement shows the distribution of this wealth among personnel, taxes and
contributions, third-party capital remuneration and own capital remuneration.
4.16 New and revised standards and interpretations of standards issued
The following accounting pronouncements and interpretations issued by the International
Accounting Standards Board (IASB) and International Financial Reporting Standards
Interpretations Committee (IFRIC) have been published or revised, but their adoption is not yet
mandatory and they have not been subject to regulation by the Accounting Pronouncements
Committee (CPC) and, accordingly, they have not been early adopted by the Company and its
investees in their financial statements for the year ended December 31, 2015. They will be
adopted as their adoption becomes mandatory. The Company has not yet estimated the
extension of possible impacts from these new pronouncements and interpretations on its
financial statements.
Arteris S.A. and Subsidiaries
34
Pronouncement Description Effective
ness
Amendments to IFRS 11 –
Accounting for acquisitions
of interest in a joint venture
It provides guidelines on how to account for the
acquisition of interest in a joint venture whose
activities represent a business under IFRS 3 – Business
Combinations.
(1)
Amendments to IAS 16 and
IAS 38 – Clarification on the
acceptable depreciation and
amortization methods
The amendments to IAS 16 forbid entities to adopt a
depreciation method based on revenue for property and
equipment items. The amendments to IAS 38
introduce a refutable assumption that revenues do not
establish an appropriate basis for the purposes of
amortization of an intangible asset.
(1)
Amendments to IFRS 10 and
IAS 28 - Sales or
contributions of assets
between an investor and its
associate or joint venture
The changes address situations of sale or contribution
of assets between an investor and its associate or joint
venture.
(1)
Amendments to IFRS 10,
IFRS 12 and IAS 28 -
Investment entities: applying
exception consolidation
The changes clarify that the exemption to prepare
consolidated financial statements is valid for a
controlling entity that is the subsidiary of an
investment entity, even if the investment entity
accounts for all of its subsidiaries at fair value, in
accordance with IFRS 10.
(1)
Amendments to IAS 7 –
Statement of cash flows
These changes provide clarification on the
improvement of the information presented to the users
of financial statements about financing activities.
(2)
Amendments to IAS 12 –
Income taxes
These changes clarify how to account for and measure
deferred tax assets on tax losses. (2)
IFRS 15 – Revenue from
contracts with customers
It establishes a single comprehensive model to be
adopted by entities when accounting for revenues from
contracts with customers.
(3)
IFRS 9 – Financial
instruments
Revision in 2014 contains requirements to: a) classify
and measure financial assets and liabilities; b)
impairment methodology; c) general hedge accounting.
(3)
IFRS 16 – Leases IFRS 16 establishes the principles for identifying,
recognizing, measuring, presenting and disclosing the
leases, both for lessees and lessors, and will replace
IAS 17 – Leases, as well as related interpretations.
(4)
(1) Annual periods beginning on or after January 1, 2016;
(2) Annual periods beginning on or after January 1, 2017;
(3) Annual periods beginning on or after January 1, 2018;
(4) Annual periods beginning on or after January 1, 2019;
The amendments to the IFRS mentioned above have not been issued by the CPC yet.
However, due to CPC’s and the Federal Accounting Council (“CFC”)’s commitment to update
the set of standards issued based on the updates and amendments by the IASB, these
amendments and changes are expected to be issued by the CPC and approved by CFC until the
date of their mandatory adoption. The Company’s Management does not expect these
Arteris S.A. and Subsidiaries
35
amendments to affect the financial statements. There are no other standards or interpretations
issued and not yet adopted that may, in the Management’s opinion, have a significant impact
on the profit or equity reported by the Company.
Additionally, the pronouncement and the interpretation below, issued by IASB, became
effective in the current year. There are no impacts from this amendment since it is not
applicable to the Company.
Pronouncement Description
Amendments to IAS 19 -
Defined benefit plans -
employee contributions
These changes clarify how an entity should recognize employee or
third-party contributions related to services provided to defined
benefit plans, taking into consideration whether these contributions
depend on the number of years worked by the employee.
Amendments to IFRSs –
Annual Improvements to the
IFRS - 2010-2012 cycle and
Annual Improvements to the
IFRS - 2011-2013 cycle
(applicable as of July 1, 2014)
The changes introduced by Annual Improvements to the IFRS -
2010-2012 and 2011-2013 cycles did not have any material impact
on the disclosures or on the amounts recognized in the Company’s
financial statements for the fiscal year ended December 31, 2015.
5. RESTATEMENT OF THE STATEMENTS OF CASH FLOWS
The Company’s Management identified a reclassification in the interest amounts disclosed in
the statements of cash flows for the year ended December 31, 2014, as shown below.
Accordingly, the Company is restating these statements of cash flows for December 31, 2014.
Previously issued Adjustment Notes Restated
12.31.2014 12.31.2014
CASH FLOWS FROM OPERATING ACTIVITIES
Profit for the year 456,860 - 456,860
-
Depreciation and amortization 344,689 - 344,689
Goodwill amortization in investments - - -
Write-off of permanent assets 27,774 - 27,774
Deferred income tax and social contribution 2,169 - 2,169
Inflation adjustment and interest on concession fees 22,105 - 22,105
Income from restricted investments (18,236) - (18,236)
Interest and inflation adjustment on borrowings 107,214 - 107,214
Interest and inflation adjustment on debentures 277,108 - 277,108
Deferred income tax and social contribution - -
Finance cost / (income) from discount to present value 26,754 - 26,754
Recognition (reversal) of provision for civil, labor and tax risks 10,343 - 10,343
Recognition (reversal) of provision for maintenance 103,071 - 103,071
Equity in the earnings (losses) of subsidiaries - - -
Non-controlling interest - -
Consolidated
Adjustments to reconcile profit for the year to net cash (used in) generated by operating
activities:
Arteris S.A. and Subsidiaries
36
(a) Reclassification of interest previously recorded under other liabilities, to the payment of
interest line.
Decrease (increase) in operating assets:
Trade receivables (27,353) - (27,353)
Amounts due from related parties - - -
Inventories (2,288) - (2,288)
Prepaid expenses (6,862) - (6,862)
Taxes recoverable (11,472) - (11,472)
Advances for new projects - -
Other receivables (1,115) - (1,115)
Contractual guarantees 263 - 263
Escrow deposits (33,731) - (33,731)
Other receivables (18) - (18)
Increase (decrease) in operating liabilities:
Trade payables (85,979) - (85,979)
Amounts due to related parties (2) - (2)
Contractual guarantees of suppliers 10,107 - 10,107
Payroll and related taxes (3,084) - (3,084)
Taxes payable 142,609 - 142,609
Income tax and social contribution paid (152,365) - (152,365)
Deferred revenue 34 - 34
Amounts due to related parties - - -
Claims received (21,250) - (21,250)
Other payables 53 - 53
Concession fees 126 - 126
Civil, labor and tax risks (6,932) - (6,932)
Other liabilities (176,788) 176,788 (a) -
Payment of interest - (349,167) (b) (349,167)
Net cash (used in) generated by operating activities 983,804 (172,379) 811,425
CASH FLOWS FROM INVESTING ACTIVITIES
Purchase of property and equipment (19,515) - (19,515)
Acquisition of intangible assets (1,721,640) - (1,721,640)
Advances for new projects - - -
Restricted investment (219,135) - (219,135)
Amount redeemed from restricted investments 86,802 - 86,802
Additions to investments - - -
Capital decrease of subsidiary - - -
Dividends received - prior years - - -
Dividends received on equity - - -
Dividends received - - -
Net cash used in investing activities (1,873,488) - (1,873,488)
CASH FLOWS FROM FINANCING ACTIVITIES
Borrowings and financing:
Funding 773,255 - 773,255
Payments (147,148) - (147,148)
Payment of interest (912) 912 (b) -
Debentures: -
Issue of debentures 1,321,138 - 1,321,138
Payment of debentures - principal (130,262) - (130,262)
Payment of debentures - interest (171,467) 171,467 (b) -
Payment of concession fees (71,570) - (71,570)
Payment of dividends (202,810) - (202,810)
Loans - related parties - - -
Other payment of interest - - -
Net cash (used in) generated by financing activities 1,370,224 172,379 1,542,603
(DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS 480,540 - 480,540
CASH AND CASH EQUIVALENTS AT THE BEGINNING OF THE YEAR 929,911 - 929,911
CASH AND CASH EQUIVALENTS AT THE END OF THE YEAR 1,410,451 - 1,410,451
Arteris S.A. and Subsidiaries
37
(b) According to the recommendation of CPC 03, the Company reclassified interest paid from
financing activity to operating activity.
Arteris S.A. and Subsidiaries
38
6. CASH AND CASH EQUIVALENTS
Broken down as follows:
(*) Represented by highly liquid short-term investments, with insignificant risk of change in
value and maturity of less than 90 days from the acquisition date, as follows:
The financial investments represent the amounts invested in exclusive funds, with daily
liquidity and bearing 100.30% of CDI interest rate on average, with characteristics of floating
investments in federal government bonds, CDBs, financial bills and repo operations backed by
debentures of large-sized financial institutions with low credit risk.
7. TRADE RECEIVABLES
Broken down as follows:
(*) According to Note 25 c.
The Management of the Company and its subsidiaries did not identify the need to recognize a
provision for loss on receivables as at December 31, 2015. The average maturity is 30 days,
except for ancillary revenues, which have a receivables longer period, according to the
negotiation of each agreement referring to the use of concessionaires’ right of way.
12.31.2015 12.31.2014 12.31.2015 12.31.2014
Cash and banks 140 83 16,105 17,928
Short-term investments (*) 127,222 109,433 472,424 1,392,523
Total 127,362 109,516 488,529 1,410,451
Parent Company Consolidated
12.31.2015 12.31.2014 12.31.2015 12.31.2014
Bank Certificates of Deposit (CDB) - - 7,202 12,890
Debentures under repurchase agreements - - 12,614 129,714
Investment funds 127,222 109,433 452,608 1,249,919
Total 127,222 109,433 472,424 1,392,523
Parent Company Consolidated
Current Current
Electronic toll(*) 133,938 137,923
Toll tickets 1,775 4,302
Toll cards 3,882 937
Supplementary revenues 13,535 10,900
Other revenues receivable - -
153,130 154,062
Non-current
12.31.2015
Non-current
12.31.2014
Consolidated
- -
-
-
7,929
235
8,164
-
-
-
235
235
Arteris S.A. and Subsidiaries
39
8. DEFERRED INCOME TAX AND SOCIAL CONTRIBUTION
Broken down as follows:
(a) Refers to tax losses and social contribution tax loss carryforwards, whose possibility of
offsetting tax credit is supported by future taxable income projections of concessionaires
Planalto Sul, Fluminense, Fernão Dias, Régis Bittencourt, Litoral Sul and Latina
Manutenção.
Noncurrent assets 12.31.2015 12.31.2014
Bases of deferred asset:
Tax loss(a) 310,886 91,692
Accrued profit sharing 14,880 13,632
Civil, labor and tax risks (b) 13,485 11,167
Merged concession (c) (17,387) (19,152)
Goodwill from SPR (d) - 5,078
Other provisions 1,759 -
Provision for highway maintenance 531,755 414,049
Adjustments to financial charges 28,396 18,204
Deferred pre-operating expenses (Federal) 45,272 59,382
Adjustments related to changes in accounting practices - adoption of Law 12,973/14
(e)
Differences in intangible assets, deferred charges and property and equipment, net -
assets 85,381 85,381
Amortization of adjustments - changes in accounting practices - assets (34,636) (14,817)
Differences of intangible assets, deferred charges and property and equipment, net -
liabilities (239,416) (124,367)
Amortization of adjustments - changes in accounting practices - liabilities 13,542 -
Reversal of interest capitalization 761 652
Taxable base 754,678 540,901
Combined statutory rate 34% 34%
Total deferred income tax and social contribution 256,591 183,906
Consolidated
Non-current liabilities 12.31.2015 12.31.2014
Bases of deferred liability:
Tax loss (a) (51,544) (83,773)
Accrued profit sharing (5,028) (4,839)
Civil, tax and labor risks (b) (3,565) (3,965)
Other provisions (1,599) -
Provision for highway maintenance (99,130) (118,302)
Adjustments in financial charges (10,688) (14,077)
Adjustments related to changes in accounting practices - adoption of Law 12,973/14
(e)
Differences in intangible assets, deferred charges and property and equipment, net 377,843 491,245
Amortization of adjustments - changes in accounting practices (20,764) -
Reversal of interest capitalization (612) (719)
Taxable base 184,913 265,570
Combined statutory rate 34% 34%
Total deferred income tax and social contribution 62,870 90,294
Consolidated
Arteris S.A. and Subsidiaries
40
(b) Refer to provisions for civil, labor and tax risks related to unsettled claims.
(c) Credit arising from the amortization of the merged concession, recorded up to the base
date of the spin-off of OHL do Brasil Participações em Infraestrutura Ltda. in June 2006
and, until then, controlled in “part B” of that company's taxable income book (LALUR).
With the merger of the interest of OHL do Brasil Participações em Infraestrutura Ltda.;
the Company recognized this credit that, pursuant to tax legislation, is amortized at the
rate of 20% per annum, for tax purposes, and for the term of the concession, for
accounting purposes.
(d) Credit arising from the merger of SPR - Sociedade para Participações em Rodovias S.A.,
former parent company of Vianorte, recognized on the amount of goodwill amortized by
SPR from December 2006 to September 2010. The Company recognized this credit that,
according to the tax law, was amortized at the rate of 20% per annum, for tax purposes,
and for the term of the concession, for accounting purposes.
(e) On December 31, 2014, the Company’s Management opted for the early adoption of Law
12,973/14 as expected for the fiscal year of 2014, in the following subsidiaries: Autovias
and Centrovias. Other subsidiaries applied said law when it took effect as of January 1,
2015. Therefore, the Company’s subsidiaries froze the balances related to changes in
accounting practices and started amortizing the residual balance of adjustments referring
to the changes in the accounting practices until the end of the concession period.
The Company has tax credits that are not being recognized given that it is a holding company
that does not record taxable result.
The future business forecasts of the Company and its subsidiaries and their income projections
are prepared by their Management.
The expectation of recovery of all credits and the actual payment of deferred tax debits,
indicated by taxable income projections, are as follows:
Period ended on:
Non-current asset
2017 81,741
2018 52,269
2019 16,152
2020 24,607
After 2021 81,822
256,591
Non-current liability
2017 8,437
2018 3,612
2019 3,612
2020 3,612
After 2021 43,597
62,870
Arteris S.A. and Subsidiaries
41
9. RESTRICTED INVESTMENTS
The Company and its subsidiaries hold restricted investments in order to fulfill contractual
obligations related to loans and borrowings and debentures. A brief description of these
obligations is provided below:
Debentures - Sinking Fund
As guarantee of the strict and full compliance with the obligations assumed, the state
concessionaires have been withholding and depositing on a daily basis part of their receivables
to repay the principal and pay the annual interest of series 2 debentures, so that at the end of
each interest and principal amortization period the payment amount is already available. These
funds are kept in an investment fund specifically established for this purpose. In the year ended
December 31, 2015, these investments yielded on average 98.10% of the CDI variation.
BNDES
The federal concessionaires must deposit, in a payment account with a financial institution,
part of the operating revenues (between 43% and 58% of the collection of tool plazas).
These funds are used for payment of the debt service and maintenance of the mandatory
minimum amount of the reserve account. After the legal fulfillment of the contractual
obligations, the excess funds are transferred to a free current account.
The Company’s federal subsidiaries must maintain deposited in a reserve account with a
financial institution, until the final settlement of all obligations assumed in the financing
agreement with the BNDES, a minimum amount equivalent to three times the amount of the
last overdue debt service installment, including the payments of principal, interest and other
debt charges arising from the financing agreement. This amount is always recalculated on the
day subsequent to each payment of the monthly installments. In the year ended December 31,
2015, these investments yielded on average 98.96% of the CDI variation.
The amounts of these investments are as follow:
10. INVESTMENTS IN SUBSIDIARIES AND ASSOCIATES
Investments in subsidiaries are as follows:
Current Non-current Current Non-current
Debentures 154,171 - 174,377 55
BNDES - 85,872 - 84,805
154,171 85,872 174,377 84,860
Consolidated
12.31.2015 12.31.2014
Arteris S.A. and Subsidiaries
42
Autovias 125,040,451 100% 183,343 701,745 518,402 341,861 83,308
Centrovias 101,483,834 100% 129,334 659,543 530,209 382,943 96,851
Intervias 2,219,666 51% 161,024 1,367,471 1,206,447 456,043 125,132
Vianorte 1,132,038 100% 155,950 541,197 385,247 308,771 69,992
Planalto Sul 284,614,544 100% 221,924 989,287 767,363 279,373 (41,462)
Fluminense 209,187,870 100% 363,007 1,491,065 1,128,058 462,616 (9,487)
Fernão Dias 505,442,685 100% 383,922 1,696,402 1,312,480 445,830 (66,371)
Régis Bittencourt 231,912,406 100% 562,635 2,131,079 1,568,444 669,640 (11,543)
Litoral Sul 326,892,720 100% 384,465 1,758,242 1,373,777 480,886 (42,292)
Latina Manutenção (*) 2,133,205 100% 30,878 90,613 59,735 269,420 (12,624)
Latina Sinalização (*) 250,000 100% 15,072 23,099 8,027 35,379 4,988
Arteris Participações 104,557 100% 79,492 79,881 389 - (25,065)
(*) Quotas.
Autovias 125,040,451 100% 190,949 842,537 651,588 373,161 99,861
Centrovias 101,483,834 100% 147,612 855,392 707,780 347,702 120,223
Intervias 4,352,285 100% 198,975 1,353,720 1,154,745 401,525 142,876
Vianorte 1,132,038 100% 170,760 684,850 514,090 319,473 96,075
Planalto Sul 242,629,494 100% 228,386 812,520 584,134 302,810 (8,150)
Fluminense 160,011,942 100% 285,494 1,250,036 964,542 483,753 11,221
Fernão Dias 340,732,128 100% 315,293 1,617,465 1,302,172 486,973 (15,472)
Régis Bittencourt 209,396,514 100% 519,179 1,774,947 1,255,768 681,165 17,953
Litoral Sul 252,630,712 100% 341,759 1,452,849 1,111,090 621,570 (216)
Paulista (*) 500,000 100% - - - - (42)
Latina Manutenção (*) 2,133,205 100% 43,501 115,603 72,102 453,444 (801)
Latina Sinalização (*) 250,000 100% 15,084 18,529 3,445 34,918 3,690
(*) Quotas.
12.31.2015
Common
sharesEquity interest (%) Equity Total assets Total liabilities Net revenue Profit / (Loss)
12.31.2014
Common
sharesEquity interest (%) Equity Total assets Total liabilities Net revenue Profit / (Loss)
Arteris S.A. and Subsidiaries
43
Changes in investments in the parent company for the year ended December 31, 2015 are as
follows:
Changes in investments in the parent company for the year ended December 31, 2014 are as
follows:
On April 14, 2014 the merger of Paulista Gerenciamento de Rodovias Ltda. (“Paulista”) into
Latina Manutenção de Rodovias Ltda. (“Latina Manutenção”), both of them controlled by
Arteris, was approved. The merger of Paulista into Latina Manutenção is part of the Group’s
corporate restructuring, which aims at improving the organization of activities, increasing
economic efficiency and synergy gain, reducing operating and financial costs and simplifying
the corporate structure.
12.31.2014 12.31.2015
Autovias 190,949 - (90,914) 83,308 183,343
Centrovias 147,612 - (115,129) 96,851 129,334
Intervias 198,975 (104,557) (162,106) 149,811 82,123
Vianorte 170,760 - (84,802) 69,992 155,950
Planalto Sul 228,386 35,000 - (41,462) 221,924
Fluminense 285,494 87,000 - (9,487) 363,007
Fernão Dias 315,293 135,000 - (66,371) 383,922
Régis Bittencourt 519,179 54,999 - (11,543) 562,635
Litoral Sul 341,759 84,998 - (42,292) 384,465
Latina Manutenção 43,501 - - (12,623) 30,878
Latina Sinalização 15,084 - (5,000) 4,988 15,072
Arteris Participações - 104,557 - (25,065) 79,492
Serviço e Tecnologia de Pagamentos S.A. 1,034 - - - 1,034
Other investments 19 - - - 19
Total 2,458,045 396,997 (457,951) 196,107 2,593,198
Capital
contribution
Interest on
capital/dividends
Equity in the
earnings (losses)
of subsidiaries in
Balance at Balance at
Parent Company
Balance at Balance at
12.31.2013 12.31.2014
Autovias 188,769 - - (97,681) 99,861 190,949
Centrovias 147,038 - 4,980 (124,629) 120,223 147,612
Intervias 200,863 - - (144,764) 142,876 198,975
Vianorte 155,386 - - (80,701) 96,075 170,760
Planalto Sul 156,536 - 80,000 - (8,150) 228,386
Fluminense 182,723 - 94,215 (2,665) 11,221 285,494
Fernão Dias 290,765 - 40,000 - (15,472) 315,293
Régis Bittencourt 343,814 - 161,676 (4,264) 17,953 519,179
Litoral Sul 259,232 - 82,743 - (216) 341,759
Paulista 1,905 (1,863) - - (42) -
Latina Manutenção 42,440 1,863 - - (801) 43,501
Latina Sinalização 18,394 - - (7,000) 3,690 15,084
Serviço e Tecnologia de Pagamentos S.A. 1,034 - - - - 1,034
Other investments 19 - - - - 19
Total 1,988,918 - 463,614 (461,704) 467,218 2,458,045
Equity in the
earnings (losses)
of subsidiaries in
Capital
contribution
Merger of Paulista
by Latina
Manutenção
Interest on
capital/dividends
Arteris S.A. and Subsidiaries
44
11. PROPERTY AND EQUIPAMENT
Changes in property and equipment are as follows:
Arteris S.A. and Subsidiaries
45
Balance at 12.31.2013 2,650 2,782 2,711 2,309 586 11,038
Additions 725 - 4,086 935 - 5,746
Disposals/write-offs - - (2,223) (196) - (2,419)
Balance at 12.31.2014 3,375 2,782 4,574 3,048 586 14,365
Additions 43 43 13 2,222 - 2,321
Balance at 12.31.2015 3,418 2,825 4,587 5,270 586 16,686
Accumulated depreciation
Balance at 12.31.2013 (2,132) (1,064) (2,178) (569) - (5,943)
Depreciation (289) (111) (752) (420) - (1,572)
Transfers/Reclassifications 793 - - (793) - -
Disposals/write-offs - - 2,139 184 - 2,323
Balance at 12.31.2014 (1,628) (1,175) (791) (1,598) - (5,192)
Depreciation (277) (145) (1,110) (341) - (1,873)
Valance at 12.31.2015 (1,905) (1,320) (1,901) (1,939) - (7,065)
Property and equipment, net
Balance at 12.31.2014 1,747 1,607 3,783 1,450 586 9,173
Balance at 12.31.2015 1,513 1,505 2,686 3,331 586 9,621
Depreciation rates - % 10 4 55.5 10
Parent Company
Cost of property and equipmentFurniture, fixtures
and facilities
Facilities, buildings and
premises
Leasehold
improvements
Other property and
equipmentLand Total
45
(a) Refers to the transfer of property and equipment to intangible assets
Furniture, fixtures
and facilities
Computers and
peripheralsVehicles
Facilities, buildings
and premisesLand
Machinery and
equipment
Other property
and equipment
Property and
equipment in
progress
Total
Balance at 12.31.2013 16,785 7,019 16,335 19,373 586 26,365 2,415 299 89,177
Additions 2,662 1,722 4,772 4,965 - 5,231 973 15,855 36,180
Transfers/Reclassifications (a) 443 (118) 1,403 (8,135) - 3,255 - (4,921) (8,073)
Disposals/write-offs (310) (449) (74) (2,235) - (3,320) (223) (8) (6,619)
Balance at 12.31.2014 19,580 8,174 22,436 13,968 586 31,531 3,165 11,225 110,665
Additions 1,354 1,309 576 1,007 - 1,747 2,222 7,284 15,499
Transfers/Reclassifications (a) (784) 22 (1,212) 8,972 - 7,607 - (17,402) (2,797)
Disposals/write-offs (306) (75) (886) (4) - (399) (20) - (1,690)
Balance at 12.31.2015 19,844 9,430 20,914 23,943 586 40,486 5,367 1,107 121,677
Accumulated depreciation
Balance at 12.31.2013 (9,658) (5,102) (10,256) (5,508) - (11,671) (605) - (42,800)
Depreciation (1,750) (1,364) (2,720) (1,462) - (3,069) (432) - (10,797)
Transfers/Reclassifications (a) 555 562 (13) 727 - 328 (793) - 1,366
Disposals/write-offs 106 71 27 2,139 - 523 186 - 3,052
Balance at 12.31.2014 (10,747) (5,833) (12,962) (4,104) - (13,889) (1,644) - (49,179)
Depreciation (1,879) (797) (2,380) (2,216) - (3,774) (380) - (11,426)
Transfers/Reclassifications (a) 508 7 66 53 - (399) - - 235
Disposals/write-offs 217 67 518 2 - 293 10 - 1,107
Balance at 12.31.2015 (11,901) (6,556) (14,758) (6,265) - (17,769) (2,014) - (59,263)
Property and equipment, net
Balance at 12.31.2014 8,833 2,341 9,474 9,864 586 17,642 1,521 11,225 61,486
Balance at 12.31.2015 7,943 2,874 6,156 17,678 586 22,717 3,353 1,107 62,414
Depreciation rates - % 9 20 20 13 - 12 16.67
Cost of property and equipment
Consolidated
Arteris S.A. and Subsidiaries
46
12. INTANGIBLE ASSETS
Changes in intangible assets are as follows:
(a) Refers to expenses with the implementation of the SAP System, which is expected to be
concluded in 2016.
Balance at 12.31.2013 1,465 - 1,465
Additions 287 8,675 8,962
Balance at 12.31.2014 1,752 8,675 10,427
Additions 100 11,873 11,973
Disposals/write-offs - (1) (1)
Balance at 12.31.2015 1,852 20,547 22,399
Accumulated amortization:
Balance at 12.31.2013 (806) - (806)
Amortization (230) - (230)
Balance at 12.31.2014 (1,036) - (1,036)
Amortization (251) - (251)
Balance at 12.31.2015 (1,287) - (1,287)
Intangible assets, net:
Balance at 12.31.2014 716 8,675 9,391
Balance at 12.31.2015 565 20,547 21,112
Amortization rate - % 20% 20% 20%
Cost of intangible assets Software
Property and
equipment in
progress (a)
Total
Parent Company
Arteris S.A. and Subsidiaries
47
Balance at 12.31.2013 6,224,431 351,939 144,380 20,275 9,997 1,173,983 3,452 7,928,457
Additions 506,527 - - 12,252 - 1,312,593 12,180 1,843,552
Transfers/Reclassifications 664,225 - - 40 - (642,539) (13,653) 8,073
Disposals/write-offs (974) - - (248) - (23,157) (312) (24,691)
Balance at 12.31.2014 7,394,209 351,939 144,380 32,319 9,997 1,820,880 1,667 9,755,391
Additions 401,454 - - 14,645 2,944 1,338,327 (502) 1,756,868
Transfers/Reclassifications 469,090 - - 485 - (466,795) (39) 2,741
Disposals/write-offs (12,927) - - (131) - (3,969) (656) (17,683)
Balance at 12.31.2015 8,251,826 351,939 144,380 47,318 12,941 2,688,443 470 11,497,317
Accumulated amortization
Balance at 12.31.2013 (1,714,222) (219,649) (76,388) (11,670) (3,059) - - (2,024,988)
Amortization (292,225) (28,034) (9,918) (2,141) (1,574) - - (333,892)
Transfers/Reclassifications (1,378) - - 12 - - - (1,366)
Disposals/write-offs 491 - - (7) - - - 484
Balance at 12.31.2014 (2,007,334) (247,683) (86,306) (13,806) (4,633) - - (2,359,762)
Amortization (463,324) (33,907) (11,489) (2,706) (1,754) - - (513,180)
Transfers/Reclassifications - - - (178) - - - (178)
Disposals/write-offs 2,543 309 - 3 - - - 2,855
Balance at 12.31.2015 (2,468,115) (281,281) (97,795) (16,687) (6,387) - - (2,870,265)
Intangible assets, net:
Balance at 12.31.2014 5,386,875 104,256 58,074 18,513 5,364 1,820,880 1,667 7,395,629
Balance at 12.31.2015 5,783,711 70,658 46,585 30,631 6,554 2,688,443 470 8,627,052
Intangible asset in
progress (e)
Advances to
suppliersTotal
Consolidated
Cost of intangible assetsIntangible assets in
highways – works
and services (a)
Concession (b)Merged concession
(c)Software Operation right (d)
Arteris S.A. and Subsidiaries
48
(a) Refer to projects and services carried out on the highway, such as paving, duplication, side roads, shoulders, work yards, special structure works, ground leveling,
implementing a system for collecting tolls and monitoring traffic, signaling and other such services, amortized on a straight line basis, prospectively as of January
1, 2015 until the final term of the concession. Until December 31, 2014, amortization was carried out based on the traffic curve until the final term of the
concession.
(b) Refers to the amount assumed for the operation of the highway system adjusted to present value. See Note 16.
(c) Refers to the right of grant deriving from merging the spun-off portion, in June 2006, of OHL Participações, former parent company of Autovias and Centrovias.
This amount is being amortized on a straight line prospectively as of January 1, 2015 until the final term of the concession. Until December 31, 2014, amortization
was carried out based on the traffic curve until the final term of the concession.
(d) Refers to the amount assumed for using granite and gneiss rocks in infrastructure work in projects for the companies pertaining to the Arteris Group and
installation and safeguarding of equipment to perform the work.
(e) Refer to undergoing projects and services on the highway, such as paving, duplication, side roads, shoulders, work yards, special structure works, ground leveling,
implementing a system for collecting tolls and monitoring traffic, signaling and other such services.
Arteris S.A. and Subsidiaries
49
13. BORROWINGS AND FINANCING
Broken down as follows:
TJLP - Long-Term Interest Rate.
(a) Credit facility opening agreement entered into with the Brazilian Development Bank
(BNDES) to finance the recovery, improvement, maintenance, conservation, expansion,
and operation works and services in the highways.
(b) Financing of equipment, guaranteed by the financed assets, collateral signature of
shareholders or promissory notes.
Consolidated
12.31.2015 12.31.2014
Series Annual charges Maturity Current Non-current Current Non-current
Autovias:
Vehicle financing (b) 6.0% p.a. Oct-17 428 355 286 782
428 355 286 782
Centrovias:
Vehicle financing (b) 6.0% p.a. Oct-17 428 355 286 782
428 355 286 782
Vianorte:
Vehicle financing (b) 6.0% p.a. Nov-17 428 327 317 754
428 327 317 754
Planalto Sul:
Investment financing (BNDES) (a) TJLP + 2.58% p.a. Dec-25 22,735 268,378 18,030 285,878
Investment financing (BNDES) (a) TJLP + 2.62% p.a. Mar-27 - 34,834 - -
Investment financing (BNDES) (a) IPCA + 8.99% p.a. Jan-27 - 16,174 - -
22,735 319,386 18,030 285,878
Fluminense:
Investment financing (BNDES) (a) TJLP + 2.45 p.a. Nov-26 36,357 662,578 25,518 586,940
36,357 662,578 25,518 586,940
Fernão Dias
Equipment financing – (FINAME) (b) 6% p.a. Jun-19 236 584 287 818
Investment financing (BNDES) (a) TJLP + 2.21% Mar-26 48,991 542,041 43,989 584,896
49,227 542,625 44,276 585,714
Régis Bittencourt
Investment financing (BNDES) (a) TJLP + 2.21% p.a. Dec-24 80,761 838,719 66,937 781,636
80,761 838,719 66,937 781,636
Litoral Sul:
Investment financing (BNDES) (a) TJLP + 2.32% p.a. Jun-26 37,898 516,416 32,706 464,147
37,898 516,416 32,706 464,147
Latina Manutenção:
Equipment financing – (FINAME) (b) TJLP + 4.5% p.a. Mar-16 141 - 3,119 139
Working capital (d) 112.5% CDI May-17 5,919 4,927 6,007 9,855
Leasing (c )
2.10% to 3.7% +
CDI and 15.8% Feb-16 174 - 1,383 170
6,234 4,927 10,509 10,164
Total 234,496 2,885,688 198,865 2,716,797
Arteris S.A. and Subsidiaries
50
(c) Finance lease agreements signed with financial institutions for acquisition of vehicles,
information technology equipment and other equipment. The guarantees are the financed
assets.
(d) Bank credit notes contracted from the financial institution for purchase of property and
equipment for the São José Mill facility, with repayment term of 36 months as from the
transaction formalization date, guaranteed by Arteris.
As at December 31, 2015, the maturities of the borrowings and financing are as follows:
The long-term financing agreements with the BNDES have covenants that, if not complied
with, can accelerate their maturity. The main covenants are:
a) Comply with environmental regulations during the effective period of the financing
agreements.
b) Not suffer any penalty for nonperformance of the concession agreements, with final
administrative decision, corresponding to infringements related to insurance or provision of
guarantees determined by the National Ground Transportation Agency (ANTT).
c) Present semiannually, to the BNDES, until the final settlement of the agreements, balance
sheets audited by an independent audit firm registered with the Brazilian Securities
Commission.
d) Except upon the express consent of the BNDES, not distribute dividends above the
mandatory minimum dividend nor pay interest on capital that is not attributable to the
mandatory minimum dividend until the completion of the financed projects.
e) Not distribute dividends above the minimum mandatory amount, payment of interest on
equity not imputed to the minimum mandatory dividend, payment of interest on loans or
amortization of the principal of these loans when the shareholders’ equity/total liabilities ratio
is lower than 20%.
f) Not grant loans to any shareholder, without the previous and express authorization from
the BNDES.
g) Not present, without previous and express authorization from the BNDES, a debt balance
representing more than 15% of the gross revenue, adopting the following definitions and
conditions solely for the purpose of verifying the non-compliance with this condition:
1) Gross revenue: gross revenue calculated in accordance with applicable accounting
legislation, earned in the prior year, verified by the stipulated documentation, amount that will
be used as a basis until the disclosure of the balance sheet for the next year.
Maturity year
2017 253,407
2018 284,852
2019 305,275
2020 959,960
After 2021 1,082,194
2,885,688
Arteris S.A. and Subsidiaries
51
2) Debt balance: balance of debts contracted and actually taken from third parties, including
principal, interest and all other charges.
3) The computation excludes the amounts related to:
3.1 The contracting of financing solely for purchase of equipment for the concessionaires’
operation.
3.2 The loans granted to concessionaires by any shareholders, as long as the interest rate does
not exceed two percent (2%) of the interbank deposit certificate (CDI) rate or eight percent
(8%) of the Extended National Consumer Price Index (IPCA), according to the interest rate
index for the loan agreements.
3.3 The debt balances related to the credit under the Agreements.
h) Not distribute dividends above the minimum mandatory amount, pay interest on capital,
pay interest on loans or repay the principal of these loans when the Debt Service Coverage
Ratio (ICSD) is lower than 1.3, calculated under the following formula:
ICSD = Cash Generation from the Activity
Debt Service
Where:
Cash Generation from the
Activity Debt Service EBITDA
(+) EBITDA (+) Repayment of principal (+) Profit for the year
(-) Income tax (+) Payment of interest (+) Finance cost/income, net
(-) Social contribution (+) Depreciation and amortization
(+) Provision for income tax and social
contribution
(+) Other non-operating expenses/income, net
i) Not assign, dispose of, transfer, sell, pledge, encumber or, in any other form, negotiate or
burden the rights assigned or its related financial investment without previous and express
consent from the BNDES.
j) Maintain deposited in a reserve account, until the final settlement of all obligations
assumed by the Company in the financing agreement, a minimum amount equivalent to three
times the amount of the last overdue debt service installment, including the payments of
principal, interest and other debt charges arising from the financing agreements.
k) In addition to the events indicated above, the BNDES may accelerate the maturity of the
agreement and require the immediate repayment of the debt, in the following events:
(a) Non-fulfillment of any obligation assumed with the BNDES and its subsidiaries, by a
company or entity of the economic group to which the Company belongs.
(b) A downsizing in the Company, in disagreement with the training program approved
by the BNDES.
(c) The existence of a sentence to condemn, final and unappealable, due to the practice of
acts involving child labor, slave labor or crime against the environment.
Arteris S.A. and Subsidiaries
52
(d) The amendment to or extinction of the concession agreements without the previous
knowledge of the BNDES.
(e) The non-fulfillment of the obligation established in the calculation of the ICSD index
previously mentioned.
The Debt Service Coverage Ratio (ICSD) of the federal concessionaires stood below 1.3. As
mentioned in item “h” above, the federal concessionaires complied with this restrictive clause.
The shareholders agree
a) Submit for the approval of the BNDES any proposals of matters regarding encumbrance
of any type, of shares owned by it, issued by the concessionaires, sale, acquisition, merger,
spin-off of assets or any other act that entails or may entail changes in the concessionaires’
current structure or transfer of the concessionaires’ control, or change in its capacity as
concessionaires’ controlling shareholder.
b) Not include in the concessionaires’ corporate agreements, bylaws or articles of
organization provisions that result in restrictions to the concessionaires’ growth capacity or to
their technological development or that result in restrictions to their ability to pay the financial
obligations of the transactions with the BNDES.
c) Cover, on a joint liability basis, through increases in the concessionaires’ capital, in cash,
the insufficiencies of funds required for executing the project.
d) Maintain, during the effective period of the agreements, its current interests in the
concessionaires’ capital, as well as not dispose of, pledge, encumber or burden its shares
representing the concessionaires’ capital, without previous and express consent of the BNDES.
e) Maintain pledged to the BNDES, during the effective period of the agreements, all shares
issued by the concessionaires.
f) In the event of the extinction of the concession agreements due to nonperformance
resulting from the concessionaires’ acts or omissions or also due to their bankruptcy or judicial
recovery, pay, on a joint liability basis, the equivalent to 25% of the debt balance with the
BNDES, in up to ninety (90) days counted from the end of the concession agreements,
regardless of the receipt of any indemnity by the Concession Authority. After the payment of
such indemnity to the BNDES, the intervening parties shall pay to the BNDES, on a joint
liability basis, within a maximum period of sixty (60) days from this payment, any difference
existing between the remaining debt balances and the indemnity amount.
g) If the indemnity does not occur within 12 months counted from the end of the concession
agreement, the intervening parties shall pay the remaining debt balance within 60 days after
such term expires.
The Company is compliant with all restrictive covenants at the end of the reporting period. The
fair value of borrowings recognized in current and non-current liabilities approximates their
carrying amount, since the impact of the discount is not significant, considering that the
discount rates are substantially similar to the contracted rates.
14. DEBENTURES
Broken down as follows:
Arteris S.A. and Subsidiaries
53
Contractual
yield rates (%)
1st issue (d) 20,000 CDI + 1.4% p.a. Jul-15 - - 230,372 -
2nd issue (i) 30,000 CDI + 2.00% p.a. Oct-17 - 198,418 - 309,154
3rd issue (k) 75,000 CDI + 2.00% p.a. Dec-16 864,146 - - 309,154
125,000 864,146 198,418 230,372 309,154
Transaction cost (4,980) - - -
859,166 198,418 230,372 309,154
Parent Company
12.31.2015 12.31.2014
Series Number issued Maturities Current Non-current Current Non-current
Contractual
yield rates (%)
Arteris:
1st issue (d) 20,000 CDI + 1.4% p.a. Jul-15 - - 230,372 -
2nd issue (i) 30,000 CDI + 2% p.a. Oct-17 - 198,418 - 309,154
3rd issue (k) 75,000 CDI + 2.00% p.a. Dec-16 864,146 - - -
125,000 864,146 198,418 230,372 309,154
Transaction cost (4,980) - - -
859,166 198,418 230,372 309,154
Autovias:
1st issue - series 2 (a) 120,000 IPCA + 8% p.a. Mar-17 74,662 49,518 63,524 104,984
3rd issue (c) 30,000 CDI + 0.83% p.a. Aug-17 106,616 108,000 108,912 204,000
150,000 181,278 157,518 172,436 308,984
Transaction cost (371) (106) (619) (477)
180,907 157,412 171,817 308,507
Centrovias:
1st issue - series 2 (a) 120,000 IPCA + 8% p.a. Mar-17 77,438 46,742 62,890 105,618
2nd issue (f) 40,000 CDI+0.99% p.a Jun-18 115,370 171,520 115,379 285,760
160,000 192,808 218,262 178,269 391,378
Transaction cost (574) (325) (896) (899)
192,234 217,937 177,373 390,479
Intervias:
3rd issue (c ) 60,000 CDI + 1.09% p.a. Sep-18 220,909 402,000 19,128 600,000
4th issue - series 1 (g) 15,000 CDI+1.10% p.a. Oct-19 4,586 150,000 3,811 150,000
4th issue - series 2 (g) 22,500 IPCA+5.96% p.a. Oct-19 30,301 225,000 5,546 225,000
97,500 255,796 777,000 28,485 975,000
Transaction cost (1,384) (2,313) (1,424) (3,698)
254,412 774,687 27,061 971,302
12.31.201412.31.2015
Consolidated
Series Number issued Maturities Current Non-currentCurrent Non-current
Arteris S.A. and Subsidiaries
54
(a) 1st issue of debentures, series 2 of state concessionaires, on March 15, 2010 with nominal
unit amount of R$1,000 each.
(b) 2nd issue of debentures, in a single series, of Vianorte on March 20, 2014 with unit face
value of R$10,000 each.
(c) 3rd
issue of debentures, in a single series, of Intervias, on September 25, 2013 with unit face
value of R$10,000 each, and 3rd
issue of debentures, in a single series, of Autovias, on
December 18, 2013 with unit face value of R$10,000 each.
(d) 1st issue of debentures, in a single series, of the Parent Company on October 4, 2013 with
unit face value of R$10,000 each.
Vianorte:
1st issue - series 2 (a) 100,000 IPCA + 8% p.a. Mar-17 61,935 41,509 52,408 88,015
2nd issue (b) 15,000 CDI + 0.86% p.a. Mar-17 63,590 30,000 64,892 90,000
115,000 125,525 71,509 117,300 178,015
Transaction cost (219) (33) (426) (252)
125,306 71,476 116,874 177,763
Planalto Sul:
1st issue (e) 1,390 CDI + 1.4% p.a. Jul-15 - - 16,011 -
2nd issue (j) 10,000 IPCA+8.17% p.a. Dec-25 - 120,472 - -
11,390 - 120,472 16,011 -
Transaction cost - (1,098) (12) (167)
- 119,374 15,999 (167)
Fluminense:
1st issue (e) 2,250 CDI + 1.4% p.a. Jul-15 - - 25,917 -
2,250 - - 25,917 -
Transaction cost - - (17) -
- - 25,900 -
Fernão Dias
1st issue (e) 3,370 CDI + 1.4% p.a. Jul-15 - - 38,818 -
2nd issue (h) 10,000 CDI + 1.15% p.a. Jun-16 115,127 - - 100,530
13,370 115,127 - 38,818 100,530
Transaction cost (237) - (251) (109)
114,890 - 38,567 100,421
Régis Bittencourt
1st issue (e) 3,940 CDI + 1.4% p.a. Jul-15 - - 45,383 -
3,940 - - 45,383 -
Transaction cost - - - -
- - 45,383 -
Litoral Sul:
1st issue (e) 2,610 CDI + 1.4% p.a. Jul-15 - - 30,064 -
2,610 - - 30,064 -
Transaction cost - - (25) -
- - 30,039 -
Total 1,726,915 1,539,304 879,384 2,257,459
Arteris S.A. and Subsidiaries
55
(e) 1st issue of debentures of federal concessionaires, in a single series, on October 4, 2013
with unit face value of R$10,000 each.
(f) 2nd
issue of Centrovias’ debentures, in a single series, on March 20, 2014, with unit face
value of R$10,000 each.
(g) 4th issue of Intervias’ debentures, in two series, the agreement was issued on October 15,
2014, with unit face value of R$10,000.
(h) 2nd issue of Fernão Dias’ debentures, in a single series, on December 15, 2014, with unit
face value of R$10,000 each.
(i) 2nd
issue of the Parent Company’s debentures on October 1, 2014, with unit face value of
R$10,000 each.
(j) 2nd
issue of Planalto Sul's debentures, on December 15, 2014, with unit face value of
R$10,000 each. The payment of this issue was on April 2015.
(k) 3rd issue of the Parent Company’s debentures on June 19, 2015, with unit face value of
R$10,000 each.
The Company classified interest paid on debentures as cash flow from financing activities in
the parent company, since these debentures were raised and transferred through inter-company
loan agreements to meet the working capital needs of its federal subsidiaries.
Debentures were subscribed by their unit face value plus, for second series debentures, the
corresponding adjustment for inflation and, for all debentures, the interest charged from the
issue date through their actual payment date, as described below:
The yield on series 2 series debentures of 1st issue of concessionaires Autovias, Centrovias and
Vianorte is paid yearly, every March 15, as of 2011, and amortized yearly, as of March 15,
2015.
The yield on 3rd
issue debentures of Intervias is paid on a semi-annual basis, every 25 of March
and September, as of 2014, and amortized in three annual installments, as of September 25,
2016.
Issue Date Nominal value Payment date Amount subscribed
1st issue - State
Series 2 03.15.10 340,000 04.27.10 345,382
2nd issue - Centrovias and Vianorte 03.20.14 550,000 03.25.14 550,722
3rd issue - Autovias and Intervias 09.25.13 and 12.18.13 900,000 10.07.13 and 12.26.13 902,168
4th issue - Intervias 10.15.14 375,000 11.05.14 377,640
1st issue - Federal 10.04.13 135,600 10.03.13 to 10.09.13 141,338
2nd issue - Federal 12.15.14 100,000 12.23.14 100,530
2nd issue - Federal 12.15.14 100,000 04.08.15 100,000
1st issue - Arteris 10.04.13 200,000 10.08.13 200,156
2nd issue - Arteris 10.01.14 300,000 10.01.14 302,486
3rd issue - Arteris 06.19.15 750,000 07.03.15 754,408
3,750,600 3,774,830
Consolidated
Arteris S.A. and Subsidiaries
56
The yield on 3rd
issue debentures of Autovias is paid on a semi-annual basis, every 20 of
February and August, as of 2014, and amortized in six semi-annual installments, as of February
2015.
The yield on 2nd
issue debentures of Centrovias is paid on a semi-annual basis, every 20 of July
and December, as of December 20, and amortized in seven semi-annual installments, as of
June 20, 2015.
The yield on series 1 debentures of 4th
issue of Intervias is paid on a semi-annual basis, every
15 of April and October, as of 2015, and amortized in three annual installments, as of October
15, 2017.
The yield on series 2 debentures of 4th
issue of Intervias is paid yearly, every October 15, as of
2015, and amortized in a lump sum on October 15, 2019.
The yield on 2nd
issue debentures of Vianorte is paid on a semi-annual basis, every 20 of March
and September, as of 2014, and amortized in three semi-annual installments, as of March 20,
2015.
The yield on 2nd
issue debentures of concessionaire Planalto Sul is paid yearly, every
December 15, as of 2016, and amortized in seven annual installments, as of December 15,
2019.
The yield on 2nd
issue debentures of Fernão Dias will be paid and amortized in a lump sum on
June 15, 2016.
The yield on 1st issue debentures of the federal concessionaires was paid and amortized in a
lump sum on July 4, 2015.
The yield on 2nd
issue debentures of the Parent Company is paid on a semi-annual basis, every
1 of April and October, as of 2015, and amortized in three semi-annual installments, as of
October 1, 2016.
The yield on 3rd
issue debentures of the Parent Company is paid on a semi-annual basis, every
19 of June and December, as of 2015, and will be amortized in a lump sum on December 19,
2016.
The yield on 1st issue debentures of the Parent Company was paid and amortized in a lump sum
on July 4, 2015.
As at December 31, 2015, long-term installments of both issues are broken down as follows:
Maturity year
2017 198,418
198,418
Arteris S.A. and Subsidiaries
57
1st, 2
nd, 3
rd and 4
th issue debentures of state concessionaires contain restrictive covenants that
could accelerate their maturity and require the fulfillment of certain financial ratios, as
specified in the early maturity clauses included in the indenture of each issue, filed with the
CVM. As at December 31, 2015, the Company and its subsidiaries were compliant with the
contractual terms and conditions agreed for the debentures.
The debentures of the 1st issue of series 2 are guaranteed by:
1. Pledge of 51% of the shares of the issuers Autovias, Centrovias, and Vianorte. The pledge
percentage will be periodically decreased as the debentures are amortized.
2. Collateralization of 80% of toll plaza receivables. The collateralized percentage will be
periodically decreased as the debentures are amortized.
3. Collateralization of 100% of the concession compensation receivables.
4. All units of the Sinking Fund, as described in Note 9.
The debentures issued by the Parent Company, as well as the debentures issued by state and
federal concessionaires have restrictive clauses that entail early redemption and require
compliance with certain financial indices, as disclosed in the section “Indentures and advances
from debentures”, filed at CVM.
In order to not fail to comply with any clause of the BNDES agreement, the subsidiary Fernão
Dias was granted referred agency’s approval for the 2nd
issue of debentures on October 16,
2014.
The debentures of the 2nd
issue of the Parent Company are guaranteed by:
1. Assignment of 49% of dividends and interest on equity paid to the parent company by
concessionaires Autovias, Centrovias and Vianorte.
2. Assignment of 100% of the funds deposited in a restricted account in which dividends paid
to the parent company by the concessionaires Autovias, Centrovias and Vianorte are
deposited.
The debentures of the 3rd
issue of the Parent Company are guaranteed by:
1. Assignment of all of the dividends and interest on equity paid to the parent company by
concessionaire Intervias.
2. Assignment of 100% of the funds deposited in a restricted account in which dividends paid
to the parent company by the concessionaire Intervias are deposited.
Maturity year
2017 834,872
2018 310,465
2019 276,629
After 2020 117,338
1,539,304
Arteris S.A. and Subsidiaries
58
3. Fiduciary sale of all of the shares issued by a wholly owned subsidiary of the parent
company which, in turn, will directly hold 49% of Intervias shares.
The 2nd
issue debentures of concessionaire Fernão Dias are guaranteed by “aval” guarantee by
Arteris S.A., in favor of the debenture holders.
The 1st issue debentures of the federal concessionaires and the and 2
nd issue debentures of
concessionaire Fernão Dias are guaranteed by “aval” guarantee by Arteris S.A., in favor of the
debenture holders.
The 2nd
issue debentures of concessionaire Planalto Sul are guaranteed by:
1. Fiduciary assignment of receivables held by the Company.
2. Pledge of all the shares held by the Company.
3. Fiduciary assignment of concession’s rights.
As at December 31, 2015, the Company and its subsidiaries were compliant with the
contractual terms and conditions agreed for the debentures.
15. RELATED-PARTY TRANSACTIONS
Related-party transactions refer to administrative expenses, inter-company working capital
loans and execution of the group’s investment plan.
The balances as at December 31, 2015 and 2014 and related-party transactions in the years
ended December 31, 2015 and 2014, are stated below:
Arteris S.A. and Subsidiaries
59
Current assets 12.31.2015 12.31.2014
Amounts due from related parties:
Subsidiaries:
Autovias (a) 1,568 1,024
Centrovias (a) 1,518 1,101
Intervias (a) 1,588 1,114
Vianorte (a) 1,314 964
Planalto Sul (a) 473 332
Fluminense (a) 1,186 517
Fernão Dias (a) 1,722 727
Régis Bittencourt (a) 1,731 881
Litoral Sul (a) 930 634
Latina Manutenção (a) 3,234 1,505
Latina Sinalização (a) 151 141
Autovias (d) 4,324 4,913
Centrovias (d) 2,982 3,386
Intervias (d) 4,679 4,783
Vianorte (d) 5,508 2,572
Planalto Sul (b) 22,229 16,823
Fluminense (b) 22,607 56,804
Fernão Dias (b) 44,678 32,730
Régis Bittencourt (b) 19,692 14,393
Litoral Sul (b) 48,515 81,758
Related parties:
SPI - 1
Total 190,629 227,103
Parent Company (*)
12.31.2015 12.31.2014
Dividends receivable from subsidiaries:
Fluminense (k) - 2,665
Régis Bittencourt (k) - 4,264
Serviço e Tecnologia de Pagamentos S.A. 6,223 -
Total 6,223 6,929
Parent Company (*)
Non-current assets
12.31.2015 12.31.2014
Amounts due from related parties - borrowings from subsidiaries:
Planalto Sul (b) 176,898 160,075
Fluminense (b) 181,961 165,833
Fernão Dias (b) 360,455 337,639
Régis Bittencourt (b) 161,772 147,379
Litoral Sul (b) 393,767 332,853
Total 1,274,853 1,143,779
Parent Company (*)
Arteris S.A. and Subsidiaries
60
12.31.2015 12.31.2014
Amounts due from related parties - Deb3ntures subsidiaries:
Planalto Sul (e) 29,710 -
Fluminense (f) 127,151 -
Fernão Dias (i) 20,938 -
Régis Bittencourt (g) 270,998 -
Litoral Sul (h) 218,260 -
Total 667,057 -
Total non-current 1,941,910 1,143,779
Parent Company (*)
Current liabilities
12.31.2015 12.31.2014
Borrowings and financing - subsidiaries:
Autovias (c) 28,669 33,225
Centrovias (c) 32,062 24,702
Intervias (c) 48,256 31,493
Vianorte (c) 23,231 17,622
Total 132,218 107,042
Parent Company (*)
12.31.2015 12.31.2014 12.31.2015 12.31.2014
Trade payables:
Related parties:
Fluminense (a) 44 - - -
Fernão Dias (a) 13 - - -
Régis Bittencourt (a) 43 - - -
Participes en Brasil S.L. - 152 - 152
Total 100 152 - 152
Parent Company Consolidated
Non-current liabilities
12.31.2015 12.31.2014
Borrowings and financing from subsidiaries - Loans:
Autovias (c) 253,201 354,230
Centrovias (c) 296,580 294,201
Intervias (c) 403,239 311,745
Vianorte (c) 181,696 164,075
Total 1,134,716 1,124,251
Amounts due from related parties - Debentures subsidiaries:
Intervias (j) 256,679 -
Total 256,679 -
Total 1,391,395 1,124,251
Parent Company (*)
Arteris S.A. and Subsidiaries
61
(a) Refer to the apportionment of administrative costs and expenses among Arteris Group
companies. In order to increase the efficiency of the current criterion for cost
apportionment, expedite the administrative process and ensure that all the benefited parties
pay for a share of the expenses related to the Group’s administrative and support areas, in
2014, the Company adopted a new criterion for apportioning costs applicable to all Group
companies. This criterion adjusts the apportioned percentages of costs based on the
companies’ revenue. This change does not affect the consolidated operating result.
(b) Intercompany loan agreements with an interest rate equivalent to 100% of the CDI variation
plus 1.037% to 1.4% per year with interest rates maturing as of December 2015 and
principal as of December 2017.
(c) Intercompany loan agreements with an interest rate equivalent to 100% of the CDI variation
plus 1.037% to 1.4% per year with interest rates maturing as of December 2015 and
principal as of December 2017.
(d) Refers to interest on equity receivable.
(e) Refers to the indenture of the 3rd
issue of non-convertible, subordinated debentures, in a
single series, entered into between Autopista Planalto Sul S.A (Issuer) and Arteris S.A
(Debenture Holder), whose proceeds will be allocated to the Issuer’s Capex plan. Referred
debentures will bear interest rates corresponding to 100% of CDI variation plus spread of
1.4% per year, with principal amount and interest rates expected to mature on March 29,
2017.
(f) Refers to the indenture of the 2nd
issue of non-convertible, subordinated debentures, in a
single series, entered into between Autopista Fluminense S.A. (Issuer) and Arteris S.A
(Debenture Holder), whose proceeds will be allocated to the Issuer’s Capex plan. Referred
debentures will bear interest rates corresponding to 100% of CDI variation plus spread of
1.5% per year, with principal amount and interest rates expected to mature on April 10,
2017.
(g) Refers to the indenture of the 2nd
and 3rd
issues of non-convertible, subordinated
debentures, in a single series, entered into between Autopista Régis Bittencourt S.A (Issuer)
and Arteris S.A (Debenture Holder), whose proceeds will be allocated to the Issuer’s Capex
plan. Referred debentures will bear interest rates corresponding to 100% of CDI variation
plus spread of 1.5% per year, with principal amount and interest rates of the 2nd
issue
expected to mature on April 27, 2017, and of the 3rd issue expect to mature on June 25,
2017.
(h) Refers to the indenture of the 3rd
issue of non-convertible, subordinated debentures, in a
single series, entered into between Autopista Litoral Sul S.A (Issuer) and Arteris S.A
(Debenture Holder), whose proceeds will be allocated to the Issuer’s Capex plan. Referred
debentures will bear interest rates corresponding to 100% of CDI variation plus spread of
1.5% per year, with principal amount and interest rates expected to mature on April 28,
2017.
(i) Refers to the indenture of the 3rd
issue of non-convertible, subordinated debentures, in a
single series, entered into between Autopista Fernão Dias S.A (Issuer) and Arteris S.A
(Debenture Holder), whose proceeds will be allocated to the Issuer’s Capex plan. Referred
debentures will bear interest rates corresponding to 100% of CDI variation plus spread of
1.5% per year, with principal amount and interest rates expected to mature on August 19,
2017.
Arteris S.A. and Subsidiaries
62
(j) Refers to the indenture of the 4th
issue of non-convertible, subordinated debentures, in a
single series, entered into between Concessionária de Rodovias do Interior Paulista S.A
(Issuer) and Arteris S.A (Debenture Holder), whose proceeds will be allocated to the
Issuer’s Capex plan. Referred debentures will bear interest rates corresponding to 100% of
CDI variation plus spread of 2.0% per year, with principal amount and interest rates
expected to mature on June 25, 2017.
(k) Dividends received on April 10, 2015.
During the year ended December 31, 2015, the Company recognized R$5,112 (R$6,111 as at
December 31, 2014), Parent Company, and R$20,616 (R$19,259 as at December 31, 2014),
Consolidated, as management compensation. Management neither received nor granted loans
to the Company and its subsidiaries, and are not entitled to significant fringe benefits.
The Company grants its employees’ profit sharing on an annual basis, which is calculated
based on the attainment of corporate targets and specific goals established, approved and
disclosed at the beginning of each fiscal year, and the payment is made in the following year,
in accordance with the attainment of targets and goals. During the current fiscal year, the
accounting provisions are calculated each month on bases that are estimated and appropriated
to profit or loss, having payroll obligations as consideration. The balances of the provision for
profit sharing (PLR) recorded on December 31, 2015, under the “Payroll obligations” line, are
R$5,783 on the parent company (R$7,647 as at December 31, 2014) and R$27,714 (R$28,595
as at December 31, 2014) on the consolidated.
All active employees and employees dismissed for the period, who worked during the fiscal
year, are entitled to profit sharing. In the case of employees dismissed, only those dismissed
without cause are entitled to profit sharing.
The calculation of the profit sharing is based on corporate targets and specific goals to which
weights are attributed in accordance with specific tables. The targets, goals and weights can be
mainly summarized as the achievement of the budget for expenses and revenues, consolidated
EBITDA and EBITDA by company, in addition to individual evaluations based on technical
expertise and commitment to quality.
12.31.2015 12.31.2014
Finance income (expenses), net:
Subsidiaries:
Autovias (44,340) (39,088)
Centrovias (46,751) (29,061)
Intervias (76,396) (37,051)
Vianorte (27,331) (20,731)
Planalto Sul 29,262 19,792
Fluminense 37,882 19,846
Fernão Dias 53,767 38,507
Régis Bittencourt 42,962 16,933
Litoral Sul 77,705 37,458
Total 46,760 6,605
Parent Company
Arteris S.A. and Subsidiaries
63
The Company and its subsidiaries offer their employees’ health care, reimbursement of dental
care expenses and life insurance during the employment period. Such benefits are partially
funded by the employees, based on their professional category and the usage of the respective
plans. These benefits are recognized as costs or expenses when incurred.
In regard to transactions carried out with related parties, whenever necessary, these transactions
are submitted to the Board of Directors for approval, pursuant to the Company’s Bylaws. The
transactions and business entered into by the Company and its subsidiaries with related parties
are subject to the finance charges previously described, which are compatible with the rates
usually practice in Brazil.
16. CONCESSION FEES
Refer to the fees payable for the concessions granted to subsidiaries Autovias, Centrovias,
Intervias and Vianorte to the São Paulo State Highway Department (DER/SP), discounted to
present value.
The concession fees will be paid in 240 monthly consecutive installments, the first of which
was paid in September 1998 by Autovias, in June 1998 by Centrovias, in February 2000 by
Intervias, and in March 1998 by Vianorte. The amounts are adjusted using the same formula
and at the same dates as the tool adjustment, and are due on the last business day of each
month.
Arteris S.A. and Subsidiaries
64
Therefore, the amount of the fees payable was determined as follows:
(*) Notional amounts adjusted for inflation through the end of the year, included solely as
additional information.
(a) The variable portion corresponds to 1.5% of the gross monthly toll revenue. On December
14, 2013, ARTESP’s Managing Board extended, for indefinite term, the previously
granted authorization to withhold and discount 50% of the amount due as variable
concession fee (which corresponds to 1.5% of the concessionaire’s revenue).
(b) The variable amount, corresponding to 1.5% of the monthly toll revenue and 25% of the
monthly supplementary revenues actually earned, is due by the last business day of the
subsequent month.
On June 27, 2015, the State Official Gazette published Artesp’s authorization for the toll tariff
increase as of July 1, 2015 based on the General Market Price Index (IGP-M).
12.31.2015 12.31.2014 12.31.2015 12.31.2014
Concession fee 8,191 7,634 8,413 7,838
Variable portion (a) 443 441 443 441
Concession fee 12,255 11,422 12,587 11,727
Variable portion (a) 490 490 490 490
Concession fee 7,626 7,108 7,833 7,298
Variable portion (a) 624 605 624 605
Concession fee 49,718 46,336 51,064 47,574
Variable portion (a) 418 416 418 416
79,765 74,452 81,872 76,389
Consolidated
Present value Notional amount (*)
12.31.2015 12.31.2014 12.31.2015 12.31.2014
Autovias Concession fee 13,211 18,669 14,472 20,948
Centrovias Concession fee 16,903 25,464 18,406 28,402
Intervias Concession fee 21,997 25,738 24,928 29,867
Vianorte Concession fee 56,815 93,177 61,494 103,308
Total 108,926 163,048 119,300 182,525
Consolidated
Present value Notional amount (*)
Non-current
Arteris S.A. and Subsidiaries
65
The number of installments payable as at December 31, 2015 is as follows:
The amounts paid by the Company’s subsidiaries to the Concession Authority during the year
ended December 31, 2015 are as follows:
As at December 31, 2015, the amounts related to the actual amount classified in non-current
liabilities are broken down as follows:
The concession model for federal highways does not include this type of payment of
concession fee to the granting authority. The type of payment adopted in this concession
operation model was offering the lowest basic toll tariff to be collected from users and the
obligation of an allowance to cover the concession’s inspection expenses.
Autovias 12 20 32
Centrovias 12 17 29
Intervias 12 37 49
Vianorte 12 14 26
Installments
CurrentNon-
currentTotal
Fixed VariableAmount
paid
Autovias 7,980 5,185 13,165
Centrovias 11,940 5,589 17,529
Intervias 7,430 7,181 14,611
Vianorte 48,443 4,852 53,295
Total 75,793 22,807 98,600
Concession Fee
74,268
2018 23,435
After 2019 11,223
108,926
2017
Maturity year
Arteris S.A. and Subsidiaries
66
17. PROVISIONS
Civil, labor and tax risks
The Company and its subsidiaries are parties to ongoing lawsuits basically involving civil
liability to highway users and labor claims.
Management recognized, based on the opinion of its legal counsel, a provision to cover
probable losses on said lawsuits and estimates that the final outcome will not affect
significantly the cash flows, financial position, and results of operations of the Company and
its subsidiaries.
Changes in the consolidated balance of civil, labor and tax risks during the period ended
December 31, 2015 are as follows:
31.12.2014 Adições Reversões Utilizações Encargos 31.12.2015
Cíveis 7.483 8.624 (4.434) (3.331) 38 8.380
Trabalhistas 7.715 5.537 (3.528) (549) (38) 9.137
Total 15.198 14.161 (7.962) (3.880) - 17.517
Additionally, the Company and its subsidiaries are parties to ongoing civil, labor, tax and other
lawsuits arising from the normal course of business, which were assessed as possible loss by
their legal counsel and for which no provision has been recognized. These lawsuits total
R$8,423, R$5,912, R$2,238 and R$859, respectively, in each nature of risk, as at December
31, 2015 (R$7,295, R$5,404, R$3,773 and R$49, as at December 31, 2014).
Escrow deposits totaling R$6,266 and R$111,437, in the parent company and consolidated,
respectively on December 31, 2015 (R$5,113 and R$54,103 on December 31, 2014), classified
in non-current assets refer to, in the subsidiaries, lawsuits to which no provision has been
recognized because the respective risk of loss was assessed as possible or remote. The increase
in the balance of escrow deposits in the consolidated, in relation to December 31, 2014 refers
to the indemnities for expropriation of works in the right-of-way provided for in the concession
agreements.
The balance of R$111,437 of escrow deposits in the consolidated is composed as follows: on
December 31, 2015, R$62,791 referring to indemnities for work expropriation in federal
concessionaires, R$32,547 referring to federal concessionaires’ lawsuits filed against ANTT, to
annul the deficiency notices imposed by the Agency, and R$16,099 referring to sundry
deposits from state concessionaires and the parent company.
12.31.2013 Additions Reversals Uses Charges 12.31.2014
Civil 5,858 13,740 (5,606) (6,509) - 7,483
Labor 5,929 9,093 (6,884) (423) - 7,715
Total 11,787 22,833 (12,490) (6,932) - 15,198
Arteris S.A. and Subsidiaries
67
Provision for maintenance and investments in highways
The provision for maintenance and investments in highways is calculated, respectively, based
on the best estimate of the expenditures to be incurred on repairs and replacements and
construction and improvement services. The provision for investments considers the amounts
through the end of the concession period, while the provision for maintenance considers the
amounts of the next intervention.
Changes in provisions for maintenance and investments in highways during the period ended
December 31, 2015 are as follows:
Payments made in the period ended December 31, 2015, related to maintenances performed,
totaled R$144,077.
ProvisionsMaintenance
in highways
Investments in
highways
Maintenance
in highways
Investments in
highways
Balances at 12.31.2014 95,258 98,280 443,244 26,120
Additions - - 172,802 1,007
Uses (122,592) (4,414) - -
Discount to present value - (2,644) 42,173 1,966
Transfers 200,858 (34,511) (200,858) 34,511
Balances at 12.31.2015 173,524 56,711 457,361 63,604
ProvisionsMaintenance
in highways
Investments in
highways
Maintenance
in highways
Investments in
highways
Balances at 12.31.2013 71,043 68,489 401,395 43,151
Additions - 9,892 103,071 -
Uses (59,849) (889) - -
Discount to present value - 1,003 22,842 2,754
Transfers 84,064 19,785 (84,064) (19,785)
Balances at 12.31.2014 95,258 98,280 443,244 26,120
Current Non-current
Arteris S.A. and Subsidiaries
68
18. EQUITY
a) As at December 31, 2015 share capital is R$1,033,198 (R$873,822 as at December 31,
2014) represented by 344,444,440 common shares without par value, held as follows:
At the Annual and Extraordinary Shareholders’ Meeting held on April 8, 2015, the Company
approved a capital increase with profit reserves in the amount of R$159,376, without issuing
new shares.
b) Profit reserves and distribution of dividends (Parent Company):
Legal and profit retention reserve
The Company’s bylaws prescribe that the profit for the year, after recognition of the legal
reserve, as provided for by law, can be allocated to the provision for civil, labor and tax
risks, the profit retention reserve set out in the capital budget to be approved at the
Shareholders’ Meeting, or the unrealized earnings reserve, pursuant to Article 198 of Law
6404/76.
Distribution of dividends
The Company’s bylaws provide for the distribution of a minimum mandatory dividend of
25% of the profit for the year, adjusted pursuant to Article 202 of Law 6404/76.
The calculation of statutory dividends as at December 31, 2015 and 2014 is as follows:
19. REVENUES
Broken down as follows:
Number of shares
subscribedEquity interest - %
Participes en Brasil S.A. 238,563,305 69.26
Board of Directors 5 -
Other 105,881,130 30.74
Total 344,444,440 100.00
12.31.2015 12.31.2014
Net income for the year 140,085 447,370
Legal reserve - 5% (7,004) (22,369)
Taxable base 133,081 425,001
Mandatory statutory dividends 25% 25%
Total 33,270 106,250
Early dividends - (79,222)
Proposed dividends 33,270 27,028
33,270 (52,194)
Arteris S.A. and Subsidiaries
69
The reconciliation between gross revenue and net revenue presented in the income statement
for the year is as follows:
12.31.2015 12.31.2014
Revenue from services provided 2,438,765 2,431,851
Revenue from construction services 1,554,486 1,757,447
Other revenue 54,198 47,060
4,047,449 4,236,358
Consolidated
12.31.2015 12.31.2014
Gross revenue 4,047,449 4,236,358
Service tax (ISSQN) (124,034) (123,318)
Tax on revenue (PIS) (16,780) (17,271)
Tax on revenue (COFINS) (77,451) (76,084)
Other deductions (1,221) (1,552)
Net revenue 3,827,963 4,018,133
Consolidated
Arteris S.A. and Subsidiaries
70
20. COSTS AND EXPENSES BY NATURE
Broken down as follows:
12.31.2015 12.31.2014
Expenses:
Personnel (530) (1,193)
Outsourced services (3,169) 921
Maintenance and upkeep (130) (26)
Depreciation / amortization (2,124) (1,802)
Insurance / guarantees (144) (1)
Consumption (98) (65)
Transportation (58) (140)
Other (1,022) (1,518)
Total (7,275) (3,824)
Parent Company
12.31.2015 12.31.2014
Expenses:
Personnel (92,833) (77,557)
Outsourced services (34,556) (39,433)
Maintenance and upkeep (2,556) (1,652)
Depreciation / amortization (7,795) (7,903)
Contingencies (5,286) (9,576)
Insurance / guarantees (242) (1,854)
Consumption (18,442) (18,137)
Transportation (5,617) (5,312)
Other (25,580) (20,662)
Total (192,907) (182,086)
Consolidated
Arteris S.A. and Subsidiaries
71
21. FINANCE INCOME (COSTS)
Represented by:
12.31.2015 12.31.2014
Costs:
Construction costs (1,554,486) (1,757,447)
Personnel (156,804) (141,455)
Outsourced services (159,897) (174,293)
Conservation (115,418) (104,936)
Maintenance/upkeep of furniture/properties (13,411) (12,182)
Consumption (33,072) (26,931)
Transportation (36,414) (33,184)
Inspection fee (Federal) (41,401) (38,773)
Funds for technological development (Federal) (3,552) (3,265)
Insurance / guarantee (23,804) (23,174)
Costs with concession authority (22,830) (22,660)
Provision for maintenance in highways (196,823) (145,463)
Depreciation / amortization (516,811) (336,786)
Other (13,507) 8,079
Total (2,888,230) (2,812,470)
Consolidated
12.31.2015 12.31.2014
Finance income:
Interest income 241,578 134,161
Short-term investments 31,560 9,228
Other income 888 73
Total 274,026 143,462
Finance costs:
Finance charges (312,165) (157,968)
Other costs (15,150) (4,557)
Total (327,315) (162,525)
Parent Company
Arteris S.A. and Subsidiaries
72
22. STATEMENTS OF CASH FLOWS
a) Cash and cash equivalents
The breakdown of cash and cash equivalents included in the statement of cash flows is
stated in Note 5.
b) Supplemental information
12.31.2015 12.31.2014
Finance income:
Interest income 1,434 4,256
Short-term investments 151,112 122,514
Finance charges - reversal of present value adjustment 6,276 -
Other income 5,916 605
Total 164,738 127,375
Finance costs:
Finance charges (542,529) (383,045)
Inflation adjustment of concession fees (26,961) (22,093)
Finance charges - discount to present value (49,443) (26,958)
Other costs (40,925) (17,977)
Total (659,858) (450,073)
Consolidated
Non-cash investing and financing transactions:
Paid-up capital – profit reserves
Paid- up capital – loan 10,000 -
159,376 101,405
12.31.2015 12.31.2014
Parent Company
Non-cash investing and financing transactions:
Purchases of intangible assets recognized under trade payables, related parties,
contractual guarantees and taxes payable
Paid-up capital – profit reserves
Capitalized interest
230,655 60,151
101,405
Consolidated
12.31.2015 12.31.2014
159,376
170,662 78,426
Cash transactions in investments involving additions in the year:
Payment of investments, which did not affect the additions in the property and equipment
and intangible assets lines in the year
Consolidated
12.31.2015 12.31.2014
(422,934) (119,994)
Arteris S.A. and Subsidiaries
73
23. RECONCILITION OF INCOME TAX AND SOCIAL CONTRIBUTION
The reconciliation of effective and statutory income tax and social contribution rates in the
income statements for the periods ended December 31, 2015 and 2014 is as follows:
The effects of certain items of such reconciliation, over which no deferred income tax and
social contribution were recognized, arise from specific tax situations of companies that did not
meet the conditions established in the accounting standard for recognition of deferred tax
assets.
12.31.2015 12.31.2014
Profit before income tax and social contribution 140,085 448,511
Combined effective rate 34% 34%
Adjustments to effective rate:
Equity in the earnings (losses) of subsidiaries: 66,676 158,853
Interest on capital received (10,593) (8,499)
Dividends received - STP (8,034)
Other adjustments (420) 998
Expenses recognized - (1,141)
Income tax and social contribution expense:
Current - (1,141)
Parent Company
Expectation of income tax and social contribution expense, according
to the combined effective rate (47,629) (152,493)
12.31.2015 12.31.2014
238,535 690,157
Profit before income tax and social contribution 34% 34%
Combined effective rate
Adjustments to effective rate:
Dividends received - STP (8,034)
Other adjustments (57) 1,356
Expenses recognized (89,193) (233,297)
Income tax and social contribution expense:
Current (189,306) (231,128)
Deferred 100,113 (2,169)
(89,193) (233,297)
(81,102) (234,653)
Consolidated
Expectation of income tax and social contribution expense, according
to the combined effective rate
Arteris S.A. and Subsidiaries
74
On November 11, 2013, the Provisional Measure 627, converted into Law No. 12,973, as of
May 13, 2014, was published, introducing changes in tax rules and revoking the Transitional
Tax Regime (RTT), adopted by the Company and its subsidiaries for calculation of income tax
and social contribution on net income.
On December 31, 2014, the Company’s Management opted for its early adoption as provided
for by laws for the fiscal year of 2014, referring to subsidiaries Autovias and Centrovias. Other
subsidiaries applied said law when it took effect as of January 1, 2015.
The adjustments were not relevant for the parent company and consolidated results.
24. EARNINGS PER SHARE
The tables below reconcile the profit and the weighted average of the value per share applied to
calculate the basic and diluted earnings per share.
There is no difference between basic and diluted earnings per share, since during the year
ended December 31, 2015 there were no equity instruments with dilution effect.
25. FINANCIAL INSTRUMENTS
According to their nature, financial instruments may involve known or unknown risks and a
potential risk assessment is important. The main market risk factors that may affect the
business of the Company and its subsidiaries are as follows:
Capital risk management
The Company’s management manages its cash in order to be able to continue as a going
concern and maximize the funds for use in new investments, as well as to provide return to
shareholders.
The Company’s capital structure consists of financial liabilities, cash and cash equivalents,
marketable securities and equity, comprising share capital and profit reserves.
12.31.2015 12.31.2014
Net income for the year 140,085 447,370
Number of shares during the year 344,444 344,444
Earnings per share 0.4067 1.2988
12.31.2015 12.31.2014
Net income for the year 149,342 456,860
Number of shares for the year 344,444 344,444
Earnings per share 0.4336 1.3264
Parent Company
Consolidated
Arteris S.A. and Subsidiaries
75
Management periodically reviews the capital structure and its ability to settle its liabilities, and
timely monitors the average term of suppliers in relation to the average turnover of current
assets, taking the necessary actions when the ratio between these balances presents assets
higher than liabilities.
The Company’s objectives when managing capital are to safeguard its ability to continue as a
going concern in order to provide return to shareholders and benefits to other stakeholders and
to maintain an optimal capital structure to reduce the cost of capital and maximize the funds for
use in new investments and investments in existing businesses.
Fair value of financial instruments carried at amortized cost
The financial instruments held by the Company are carried at amortized cost and approximate
their fair value because:
Borrowings, financing and debentures: are substantially contracted at floating interest rates.
Trade receivables and payables: have average term of 30 days.
Cash and cash equivalents and restricted investments: are substantially indexed to the CDI.
As the nature, characteristics and contracted conditions are reflected in the carrying amounts,
the eligible balances are discounted to present value, when applicable. The Company and its
subsidiaries did not hold derivatives or other instruments with similar risks. Differences might
occur if these amounts were settled in advance.
(*) It refers to the hierarchy to calculate the fair value.
(*) It refers to the hierarchy to calculate the fair value.
12.31.2015 12.31.2014 12.31.2015 12.31.2014
AssetsLoans
receivable
Loans
receivable
Loans
receivable
Loans
receivable
Cash and cash equivalents 127,362 109,516 488,529 1,410,451
Related parties 2,132,539 1,370,882 - -
Trade receivables - - 161,294 154,297
Restricted investments - - 240,043 259,237
Other receivables 1,543 1,314 5,001 6,874
Parent Company Consolidated
12.31.2015 12.31.2014 12.31.2015 12.31.2014
LiabilitiesFinancial liability at
amortized cost
Financial liability at
amortized cost
Financial liability at
amortized cost
Financial liability at
amortized cost
Trade payables and contractual guarantees 6,246 2,809 220,404 204,647
Borrowings and financing - - 3,120,184 2,915,662
Debentures 1,057,584 539,526 3,266,219 3,136,843
Related parties 1,523,713 1,231,445 - 152
Concession fees - - 188,691 237,500
Other payables 6,718 2,756 26,755 10,165
Parent Company Consolidated
Arteris S.A. and Subsidiaries
76
There are no differences between the amortized cost and the fair value of the Company’s
financial instruments.
Market risks
a) Exposure to exchange rate risks
As at December 31, 2015, the Company and its subsidiaries did not have any material
assets or liabilities denominated in foreign currency.
b) Exposure to interest rate risks
The Company, through its subsidiaries, is exposed to normal market risks related to TJLP,
IPCA and CDI fluctuation in connection with real-denominated borrowings and
debentures. Interest on short-term investments is pegged to CDI fluctuation.
Pursuant to CVM Instruction 475, on December 31, 2015, Management carried out a
sensitivity analysis, taking into account 25% and 50% increases and a 25% decrease in
expected interest rates on the balances of borrowings and financing and debentures, net of
short- term investments.
Source of indexes: Focus Report - BACEN.
(*) Refers to the scenario of interest to be incurred in the shorter of the next 12 months or
up to the agreement termination date.
These presentations are additional to the disclosures required by IFRS, being in
conformity with the disclosures required by the CVM.
c) Credit risk
As at December 31, 2015, the subsidiaries have receivables totaling R$133,938
(R$137,923 at December 31, 2014) from CGMP - Centro de Gestão de Meios de
Pagamento S.A., Dbtrans, Conectar and Autoexpresso, arising from tolls collected by the
electronic toll payment system (“Sem Parar”), recognized in line item “Trade receivables”.
IndicatorsScenario I
(probable)
Scenario II
(+ 25%)
Scenario III
(+50%)
Scenario IV
(- 25%)
CDI 13.75% 17.19% 20.63% 10.31%
Interest to be incurred (*) (216,296) (267,690) (318,516) (172,363)
Income from short-term investments 77,630 99,243 116,430 58,667
Interest to be incurred from CDI, net (*) (138,666) (168,447) (202,086) (113,696)
TJLP 7.50% 9.38% 11.25% 5.63%
Interest to be incurred (*) (250,682) (306,043) (361,376) (195,288)
Interest to be incurred from TJLP, net (*) (250,682) (306,043) (361,376) (195,288)
IPCA 7.44% 9.30% 11.16% 5.58%
Interest to be incurred (*) (90,176) (101,048) (112,355) (78,250)
Interest to be incurred from IPCA, net (*) (90,176) (101,048) (112,355) (78,250)
Interest to be incurred, net (*) (479,524) (575,538) (675,817) (387,234)
Arteris S.A. and Subsidiaries
77
The subsidiaries have a letter of guarantee issued by a bank to secure the collection of
such receivables from CGMP.
d) Liquidity risk
Liquidity risk is managed by the parent company Arteris S.A., which has an appropriate
liquidity risk management model for the needs to obtain funding and manage liquidity on
a short-, medium- and long-term basis.
The parent company manages liquidity risks by maintaining adequate reserves, bank credit
lines and other credit lines for obtaining funding in the form of loans, as deemed
appropriate, through ongoing monitoring of forecast and actual cash flows, as well as
through the combination of maturity profiles for financial assets and liabilities.
The table below shows details of the remaining contractual maturity of the Company’s
non-derivative financial liabilities and the contractual amortization terms. This table was
prepared under the undiscounted cash flow method for financial liabilities based on the
most recent date on which the Company should settle the respective obligations. The table
includes interest and principal cash flows. To the extent that the interest flows are floating,
the undiscounted amount was obtained based on the interest curves at the end of the
reporting period. The contractual maturity is based on the most recent date on which the
Company should settle the respective obligations:
25. SEGMENT REPORTING
On January 1, 2009, the Company adopted CPC 22 and IFRS 8 – Segment Reporting, which
require that operating segments be identified based on internal reports regarding the
Company’s components that are regularly reviewed by the Company’s Management, in charge
of operational decisions, to allocate funds to the segment and assess its performance.
As a means of managing its business within the financial and operational scopes, the Company
has classified its businesses as construction and concession of highways. These two divisions
are considered the primary segments for reporting purposes. The main characteristics are
mentioned in Notes 2 and 4.
a) Income statement by segment
Debentures - CDI (State) 14.42 580,815 1,078,003 31,890 - - 1,690,708
Debentures - IPCA 13.36 270,880 889,378 60,866 18,849 414,443 1,654,416
Finame 5.69 1,198 1,592 584 119 - 3,493
Concession fees 10.60 34,287 115,187 64,885 - - 214,359
BNDES Automático 6.53 351,829 353,266 380,347 1,209,626 1,652,220 3,947,288
Working capital 9.85 - 12,165 - - - 12,165
Leasing 0.63 - 176 - - - 176
Total 1,239,009 2,449,767 538,572 1,228,594 2,066,663 7,522,605
2019 After 2020 TotalTypes
Effective interest rate
(weighted average) %
p.a.
2016 2017 2018
Arteris S.A. and Subsidiaries
78
Concession Construction TotalEliminations and
holding
Consolidated
balance
Net revenue of the segment 3,827,963 304,799 4,132,762 (304,799) 3,827,963
Costs (2,893,730) (279,252) (3,172,982) 284,752 (2,888,230)
Gross profit 934,233 25,547 959,780 (20,047) 939,733
General and administrative expenses (204,088) (35,329) (239,417) 23,525 (215,892)
Other operating (expenses) income 1,805 166 1,971 7,868 9,839
Finance income 324,911 2,196 327,107 (162,369) 164,738
Finance costs (763,754) (5,093) (768,847) 108,989 (659,858)
Foreign exchange gain (loss), net (1) - (1) (24) (25)
Operating profit before taxes 293,106 (12,513) 280,593 (42,058) 238,535
Income tax and social contribution:
Current (187,441) (1,567) (189,008) (298) (189,306)
Deferred 98,463 6,444 104,907 (4,794) 100,113
Profit for the year 204,128 (7,636) 196,492 (47,150) 149,342
12.31.2015
Concession Construction TotalEliminations
and holding
Consolidated
balance
Net revenue of the segment 4,018,133 488,362 4,506,495 (488,362) 4,018,133
Costs(2,839,340) (448,223) (3,287,563) 475,093 (2,812,470)
Gross profit 1,178,793 40,139 1,218,932 (13,269) 1,205,663
General and administrative expenses (193,289) (35,908) (229,197) 24,097 (205,100)
Other operating (expenses) income 807 120 927 11,041 11,968
Finance income 239,933 2,814 242,747 (115,372) 127,375
Finance costs (543,545) (2,474) (546,019) 95,946 (450,073)
Foreign exchange gain (loss), net 324 324
Operating profit before taxes 682,699 4,691 687,390 2,767 690,157
Income tax and social contribution:
Current (224,034) (5,953) (229,987) (1,141) (231,128)
Deferred (1,453) 4,151 2,698 (4,867) (2,169)
Profit for the year 457,212 2,889 460,101 (3,241) 456,860
12.31.2014
Arteris S.A. and Subsidiaries
79
b) Balance sheet by segment
Assets Concession Construction TotalEliminations and
holding
Consolidated
balance
CURRENT
Cash and cash equivalents 339,404 21,763 361,167 127,362 488,529
Trade receivables 153,096 34 153,130 - 153,130
Restricted investments 154,171 - 154,171 - 154,171
Amounts due from related parties 134,041 11,555 145,596 (145,596) -
Other current assets 78,082 18,674 96,756 25,778 122,534
Total current assets 858,794 52,026 910,820 7,544 918,364
NON-CURRENT ASSETS
Restricted investments 85,872 - 85,872 - 85,872
Amounts due from related parties 1,391,395 - 1,391,395 (1,391,395) -
Deferred income tax and social contribution 226,046 15,152 241,198 15,393 256,591
Other non-current assets 115,391 1,061 116,452 14,825 131,277
Property and equipment 14,342 38,451 52,793 9,621 62,414
Intangible assets 8,598,918 7,022 8,605,940 21,112 8,627,052
Deferred charges 45,273 - 45,273 (45,273) -
Total non-current assets 10,477,237 61,686 10,538,923 (1,375,717) 9,163,206
Total assets 11,336,031 113,712 11,449,743 (1,368,173) 10,081,570
12.31.2015
Liabilities Concession Construction TotalEliminations and
holding
Consolidated
balance
CURRENT
Borrowings and financing 228,262 6,234 234,496 - 234,496
Debentures 867,749 - 867,749 859,166 1,726,915
Trade payables 129,595 15,105 144,700 (5,309) 139,391
Payroll and related taxes 99,361 21,649 121,010 21,140 142,150
Concession fees 79,765 - 79,765 - 79,765
Dividends proposed - - - 33,270 33,270
Claims received 3,942 - 3,942 - 3,942
Provision for maintenance / Investments 230,235 - 230,235 - 230,235
Other current liabilities 273,616 12,196 285,812 (188,855) 96,957
Total current liabilities 1,912,525 55,184 1,967,709 719,412 2,687,121
NON-CURRENT LIABILITIES
Borrowings and financing 2,880,761 4,927 2,885,688 - 2,885,688
Debentures 1,340,886 - 1,340,886 198,418 1,539,304
Concession fees 108,926 - 108,926 - 108,926
Provision for maintenance / investments 520,965 - 520,965 - 520,965
Other non-current liabilities 2,026,364 7,651 2,034,015 (1,939,298) 94,717
Total non-current liabilities 6,877,902 12,578 6,890,480 (1,740,880) 5,149,600
Equity 2,545,604 45,950 2,591,554 (346,705) 2,244,849
Total liabilities 11,336,031 113,712 11,449,743 (1,368,173) 10,081,570
12.31.2015
Arteris S.A. and Subsidiaries
80
26. GUARANTEES AND INSURANCES
By force of contract, the concessionaires maintain regularized and updated the guarantees
covering expansion and special conservation functions, as well as operating functions, ordinary
upkeep of the highway network and payment of the fixed concession fees, when applicable. In
addition, as required by contract and the internal risk management policy, the concessions have
insurance policies in place for operating risks, engineering risks and civil liability, to ensure
coverage of damages arising from risks inherent to its activities, such as loss of revenue, total
Assets Concession Construction TotalEliminations
and holding
Consolidated
balance
CURRENT
Cash and cash equivalents 1,279,341 21,594 1,300,935 109,516 1,410,451
Trade receivables 152,835 1,227 154,062 - 154,062
Restricted investments 174,377 - 174,377 - 174,377
Amounts due from related parties 107,049 - 107,049 (107,049) -
Other current assets 54,099 60,279 114,378 (34,782) 79,596
Total current assets 1,767,701 83,100 1,850,801 (32,315) 1,818,486
NON-CURRENT ASSETS
Restricted investments 84,860 - 84,860 - 84,860
Amounts due from related parties 1,124,251 - 1,124,251 (1,124,251) -
Deferred income tax and social contribution 155,009 8,709 163,718 20,188 183,906
Other non-current assets 48,706 542 49,248 6,213 55,461
Property and equipment 16,436 35,877 52,313 9,173 61,486
Intangible assets 7,380,334 5,904 7,386,238 9,391 7,395,629
Deferred charges 59,373 - 59,373 (59,373) -
Total non-current assets 8,868,969 51,032 8,920,001 (1,138,659) 7,781,342
Total assets 10,636,670 134,132 10,770,802 (1,170,974) 9,599,828
12.31.2014
Liabilities Concession Construction TotalEliminations
and holding
Consolidated
balance
CURRENT
Borrowings and financing 188,356 10,509 198,865 - 198,865
Debentures 649,012 - 649,012 230,372 879,384
Trade payables 125,281 14,778 140,059 2,809 142,868
Payroll and related taxes 106,139 27,374 133,513 16,050 149,563
Concession fees 74,452 - 74,452 - 74,452
Dividends proposed 6,929 - 6,929 20,099 27,028
Claims received 39,266 - 39,266 (20,919) 18,347
Provision for maintenance / Investments 193,538 - 193,538 - 193,538
Other current liabilities 321,909 8,361 330,270 (256,499) 73,771
Total current liabilities 1,704,882 61,022 1,765,904 (8,088) 1,757,816
NON-CURRENT LIABILITIES
Borrowings and financing 2,804,569 10,164 2,814,733 (97,936) 2,716,797
Debentures 1,948,521 - 1,948,521 308,938 2,257,459
Concession fees 163,048 - 163,048 - 163,048
Provision for maintenance / investments 469,364 - 469,364 - 469,364
Other non-current liabilities 1,147,882 4,360 1,152,242 (1,045,675) 106,567
Total non-current liabilities 6,533,384 14,524 6,547,908 (834,673) 5,713,235
Equity 2,398,404 58,586 2,456,990 (328,213) 2,128,777
Total liabilities 10,636,670 134,132 10,770,802 (1,170,974) 9,599,828
12.31.2014
Arteris S.A. and Subsidiaries
81
or partial destruction of works and assets that are part of the concession, as well as property
damage and bodily injury to users. All of them are in accordance with international standards
for projects of this nature.
As at December 31, 2015, the subsidiaries’ insurance coverage is summarized as follows:
(*) By claim.
The Company has also civil liability insurance policies for board members, directors and
officers, with an indemnity limit of R$62,000.
The Company contracted Judicial Guarantee Insurance policies referring to lawsuits deriving
from ANTT’s tax deficiency notices to which no provision was recognized, since the related
risk was classified as possible or remote. These guarantees amount to R$54,828 for Litoral Sul
and R$1,160 for Planalto Sul.
27. EVENTS AFTER THE REPORTING PERIOD
Arteris
On February 1, 2016, Arteris obtained a foreign loan totaling fifty million dollars (US$50,000)
from The Bank of Nova Scotia. The loan matures in August 2016 and is subject to interest rates
of 2.2727% p.a. As a hedge against the foreign exchange variation, on the same date the
Company also entered into a swap agreement with Scotia Bank do Brasil in order to convert
the US dollar to the CDI+1.85% p.a. The proceeds will be allocated to the group’s investment
plan.
On March 14, 2016, Arteris entered into a share purchase agreement with DBTRANS
Administração de Meios de Pagamento Ltda., involving the sale of all the shares of Serviços e
Tecnologia de Pagamentos S.A. (“STP”) held by the Company, representing 4.68% of STP’s
capital stock, for R$191,224, for an estimated net income of approximately R$146,000. The
sale of the shares by the Company to the buyer was approved by the Company’s Board of
Directors at a meeting held on this date, and its financial conclusion is contingent upon
compliance with specific conditions precedent common to operations of such a nature.
Centrovias
Type Covered risks Autovias Centrovias Intervias Vianorte
All risks Property damage/loss of revenue (*) 180,000 180,000 180,000 180,000
Civil liability 18,000 25,000 21,000 25,000
Guarantee Concession agreement performance guarantee 98,611 135,767 163,021 127,786
Type Covered risksPlanalto
SulFluminense
Fernão
Dias
Régis
Bittencourt
Litoral
Sul
All risks Property damage/loss of revenue (*) 180,000 180,000 180,000 180,000 180,000
Civil liability 20,000 20,000 20,000 20,000 20,000
Guarantee Concession agreement performance guarantee 53,951 74,369 139,652 149,007 112,420
Indemnity limits – State
Indemnity limits – Federal
Arteris S.A. and Subsidiaries
82
Pursuant to the conclusions from the notes to the financial statements, on September 19, 2014,
Centrovias was granted an injunction from the Court of Appeals of São Paulo to fully adjust its
toll tariffs. The adjustment index applied was 6.37% and is in compliance with the variation in
the IPCA rate between June 2013 and May 2014. The tariffs were adjusted on September 19,
2014, at 12:00 a.m. On March 21, 2016, Centrovias was served with notice of a first-instance
court decision, which denied the claim, revoking the preliminary injunction granted. On March
22, 2016, at 12:00 a.m., Centrovias began charging toll fees without including the total
adjustment related to the period between June 2013 and May 2014. Centrovias will appeal this
decision
Fluminense
Fluminense approved the issue, by the Company, of three thousand and five hundred (3,500)
non-convertible registered, subordinated debentures, with aa unit face value of ten thousand
reais (R$10,000.00), totaling thirty-five million reais (R$35,000,000.00), yielding 100% of the
CDI variation and a spread of 1.5%, with maturity estimated for October 19, 2017.
Capital increases
The capital increases of the group concessionaires are as follows:
Date Approval Concessionaire Shares issued Amount
01.05.2016
Extraordinary
Shareholders’
Meeting
Planalto Sul 6,540,222 5,000
01.05.2016
Extraordinary
Shareholders’
Meeting
Litoral Sul 4,167,000 5,000
02.05.2016
Extraordinary
Shareholders’
Meeting
Planalto Sul 6,596,306 5,000
03.07.2016
Extraordinary
Shareholders’
Meeting
Planalto Sul 4,000,000 3,000
01.20.2016
Extraordinary
Shareholders’
Meeting
Planalto Sul 10,624,670 8,000
01.20.2016
Extraordinary
Shareholders’
Meeting
Regis Bittencourt 14,827,018 36,000
02.22.2016
Extraordinary
Shareholders’
Meeting
Planalto Sul 16,216,216 12,000
01.20.2016
Extraordinary
Shareholders’
Meeting
Fernão Dias 14,476,684 11,000
02.22.2016
Extraordinary
Shareholders’
Meeting
Fernão Dias 6,720,430 5,000
03.21.2016 Extraordinary Fernão Dias 16,000,000 12,000
Arteris S.A. and Subsidiaries
83
Shareholders’
Meeting
100,168,546 102,000
28. MATERIAL FACTS
As informed in Note 1, the Company is undergoing a public tender offer process. On March 7,
2016, the Company received a letter from the CVM, dated March 4, 2016, which resolved on
the need to prepare a valuation report of the Company1s shares by Banco BNP Paribas Brasil
S.A. (“BNP Paribas”), including the objective calculation of the amounts attributed to the
possibility of conession renewals and/or the inclusion of new concessions in the Company’s
business portfolio.
On March 21, the Company received a revised version of the valuation report of shares
assessed at their economic value, prepared by BNP Paribas, a specialized institution chosen by
shareholders representing the shares outstanding within the scope of the tender offer. The
revised version of the Valuation Report includes the necessary adjustments to comply with the
CVM Official Letter.
In accordance with the revised version of the Valuation Report, BNP Paribas assessed the
economic value of the Company’s shares at between R$8.86 and R$9.58 per share,
corresponding to a range higher than the one presented in the original version of the valuation
report, disclosed to the market by means of a Material Fact dated September 22, 2015.
On the same date, for purpose of cancellation of its registration as a category A publicly held
company and subsequent conversion into a category B, the Company announced to its
shareholders and the market in general that it had been informed that the offeror, Partícipes en
Brasil II S.L., declared its awareness of the revised version of the valuation report of the
Company’s shares prepared by BNP Paribas and will proceed with the public tender offer,
pursuant to the terms and conditions already disclosed to the market.
On March 23, 2016, the Company informed its shareholders and the market in general, by
means of a material fact that, considering the disclosure of a revised version of the valuation
report of the shares issued by the Company at their economic value, shareholders holding at
least 10% of the outstanding shares have at least 15 days to require the holding of a Special
Shareholders’ Meeting to resolve on a new valuation of the Company. This term is counted as
of March 22, 2016.
OPINION OF THE FISCAL COUNCIL
At a meeting held at 12:00 p.m. today, the members of the Fiscal Council of ARTERIS S.A.
(“Company”), pursuant to Article 163 of Law 6404/76, after examining the documents and Management
Proposals submitted for their analysis on this date, and considering the opinion without reservations
issued by the independent auditors Deloitte Touche Tohmatsu Auditores Independentes, unanimously
declared their favorable opinion in regard to the approval, by the Company’s Annual Shareholders’
Meeting, to be held on April 29, 2016, and based on the Management Report and Financial Statements for
the fiscal year ended December 31, 2016 (said documents having been authenticated by the presiding
board and filed with the company as Docs. 1, 2 and 3, respectively), of the allocation of annual net
income of one hundred and forty million, eighty-five thousand, two hundred and fifty-eight reais and
thirty-eight centavos (R$140,085,258.38), as follows (i) seven million, four thousand, two hundred and
sixty-two reais and ninety-one centavos (R$7,004,262.91), equivalent to 5% of annual net income, to the
legal reserve, pursuant to the law and the Company’s Bylaws; (ii) thirty-three million, two hundred and
seventy thousand, two hundred and forty-eight reais and eighty-seven centavos (R$33,270,248.87s),
equivalent to 25% of annual net income, to the distribution of mandatory dividends for 2015, pursuant to
Article 22 of the Company’s Bylaws; (iii) ninety-nine million, eight hundred and ten thousand, seven
hundred and forty-six reais and sixty centavos (R$ 99,810,746.60) to the profit reserve in order to cover
the capital budget prepared by the Board of Executive Officers, which was submitted to and approved by
this Fiscal Council and which will be submitted for approval to the Board of Directors, pursuant to Article
196 of Law 6404/76. However, if the allocations herein are approved without reservations, the amount of
the profit reserves will exceed the amount of the capital stock, thereby breaching the limit envisaged in
Article 199 of Law 6404/76. The members of the Fiscal Council therefore also recommend the
capitalization of that part of the reserves exceeding the Company’s capital stock in the estimated amount
of forty-nine million, nine hundred and five thousand, three hundred and seventy-three reais and thirty
centavos (R$49,905,373.30).
São Paulo, March 28, 2016.
Evelyn Joerg
Member
Luiz Fernando Parente
Member
Domingos Aparecido Maia
Member
Luiz Gustavo Rodrigues Pereira
Alternate member
Frederico Tardin Vita
Alternate member
Isacson Casiuch
Alternate member
2016 Capital Budget Proposal
In accordance with Article 196 of Law 6404/76, the Company’s Board of Directors submits to your analysis
and vote at the Annual Shareholders’ Meeting to be held on April 29, 2016, the 2016 capital budget proposal,
as outlined in the table below:
Additionally, in light of the investment commitments made to the Concession Authority with respect to its five
federal concessionaires, the Company expects to invest approximately R$6.8 billion during the entire
concession term. These investments in fixed and intangible assets include spending on the construction,
improvement and maintenance of the highway stretches managed by the Company, consistent with its long-
term investment plan and the legal requirements of its concession contracts.
Cash Flow Estimate for 2016 In thousands of Brazilian reais
Opening cash 489
Cash flow generated by operations after income tax 1.316
New financing and finance income minus financing amortization and
payment of f inance costs (356)
Other features: Ow n or/and third parties 1.609
Payment of dividends - Annual Shareholders' Meeting (33)
Cash available for investments 3.025
Investments expected - concessions (2.219)
Other investments in projects and equipment (11)
Closing cash 796
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