4Q17 AND 2017 EARNINGS RELEASE. Food for the well-being of Society and the people s happiness. Earnings Release e 4Q17

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1 Earnings Release 2017 e 4Q17 4Q17 AND 2017 EARNINGS RELEASE Food for the well-being of Society and the people s happiness. 1

2 Eusébio (CE), March 05, 2018 M. Dias Branco S. A. Indústria e Comércio de Alimentos (B3: MDIA3), the leader in Brazil's cookie & cracker and pasta markets, announces today its results for the fourth quarter (4Q17) and full year of The consolidated financial statements were prepared in accordance with International Financial Reporting Standards (IFRS) and the accounting practices adopted in Brazil (BR GAAP). RESULTS CONFERENCE CALL March 06, 2018 Stock Price: Closing on 03/02/2018 MDIA3: R$57.40 per share Market cap: R$19.5 billion Time: > Portuguese (BR GAAP) 10:00 a.m. (Brasília) 8:00 a.m. (New York) Phone: +55 (11) or (11) Password: M. Dias Replay: +55 (11) Code: > English (BR GAAP) 10:00 a.m. (Brasília) 8:00 a.m. (New York) Phone: +1 (516) Password: M. Dias Replay.: Code: IR CONTACT Geraldo Luciano Mattos Júnior Vice-President of Investments and Controllership Phone: +55 (85) geraldo@mdiasbranco.com.br Fabio Cefaly New Business and Investor Relations Director Phone: +55 (11) fabio.cefaly@mdiasbranco.com.br Fernanda Carvalho New Business and Investor Relations Manager Phone: +55 (85) ri@mdiasbranco.com.br Julianny Barreto New Business and Investor Relations Analyst Phone: +55 (85) ri@mdiasbranco.com.br Renata Lessa New Business and Investor Relations Analyst Phone: +55 (85) ri@mdiasbranco.com.br MANAGEMENT S COMMENT 2

3 MANAGEMENT S COMMENT Dear Shareholders, M. Dias Branco announces its results for the fourth quarter (4Q17) and full year of 2017 and reaffirms its commitment to best transparency and disclosure practices, providing shareholders and society with the broadest and most accurate interpretation of its operations and purposes. The 2017 year was marked by achievements in our growth strategy, geographic diversification and optimization of our product portfolio. In 2017, net revenue increased by 1.6% (volume +2.5% and average price -1%), we maintained our national leadership position in our two main product lines (cookies and pasta), expanding our market share, and EBITDA increased by 5.1% (Net Income +7.6%). We invested R$307.1 million in CAPEX and net cash generated by operating activities totaled R$870.8 million. Financial and Operating Results 4Q17 4Q16 Variation 3Q17 Variation Variation Net Revenue (R$ million) 1, , % 1, % 5, , % Total Sales Volume (thousand tonnes) % % 1, , % Cookies & Crackers Sales Volume (thousand tonnes) % % % Pasta Sales Volume (thousand tonnes) % % % Market share of Cookies & Crackers (volume)* 31.9% 31.6% 0.3 p.p 32.3% -0.4 p.p 32.5% 30.9% 1.6 p.p Market share of Pasta (volume)* 33.5% 32.0% 1.5 p.p 32.2% 1.3 p.p 32.4% 31.5% 0.9 p.p Net Profit (R$ million) % % % Ebitda (R$ million) % % % Ebitda Margin 14.2% 17.2% -3 p.p 19.8% -5.6 p.p 17.8% 17.3% 0.5 p.p Net Debt (R$ million) n/a % n/a Net Debt / EBITDA (last 12 months) n/a % n/a Capex (R$ million) % % % Net Cash generated from operating activities % % % *Note: The values presented on 4Q17 and 4Q16 are from the period of Nov/Dec 2017 and (*) The values presented on 4Q16 e 2016 w ere ajusted using the Cash & Carry data for comparison The values presented on 2017 and 2016 are from the period of Jan/Dec 2017 and The 3Q16 and 3Q17 refers to the period of Jul/Aug of 2016 e 2017 These results reinforce our understanding that we are adopting the necessary and appropriate measures for the continuity of sustainable and profitable growth. In 2016, we restructured the sales area, in which our teams are taking on a more regional approach and selling brands and products that are appropriate to each region, increasing growth potential and streamlining our cost structure. Additionally, as we focus on increasing sales and building strong brands, we also expanded and redefined our marketing investments In line with our strategy, during 2017, we continued the projects described above and carried out other important measures, not only for the year but also for years to come. We launched products with higher added value: Adria Plus Life wholemeal cookies (May/17), Vitarella Treloso Mega cookies (August/17), Triwafer coated wafers cookies under the Isabela brand (September/17) and additional cookies also under the Isabela brand (October/17), among others; We continued the geographic diversification of our sales. The offering of products and brands expanded to areas beyond the Northeast region (i.e.: availability of the Vitarella brand in the Southeast), we increased our sales team in the South and Southeast regions, increased marketing investments and began to implement supply chain improvements. From 2016 to 2017, Net Sales by Region(%) 27.8% 28.7% 30.2% 72.2% 71.3% 69.8% Northeast Others Regions 3

4 Revenue in regions outside of the Northeast grew by approximately 7%; Logistic service levels 1 increased during the year (85% in Dec/2017 vs. 73% in Dec/2016), resulting from the supply chain review initiated in 2017, which included changes in demand planning, inventory and production, as well as improvements in infrastructure distribution and upgrading of technology used in transportation and management and control; We increased marketing investments to strengthen our brands and increase our sales, in which we highlight the 360º campaigns, the extra slots in retail establishments and advertisements in traditional and digital media. Additionally, we updated and modernized the packaging of the Vitarella, Pilar, Adria, Estrela, Richester, Salsitos and Delicitos brands; Strong increase in exports. We exported to 25 countries in 2017 (19 countries in 2016), with gross revenue of R$35 million (+22.0% vs. 2016), with highlights to cookies & crackers; Infrastructure investments of R$307.1 million (+16.4% vs. 2016), with highlights to the expansion of the margarine & vegetable shortening plant in Fortaleza (CE) and the ongoing construction of a new mill in Bento Gonçalves (RS); We began to implement a Succession Plan for the Executive Board, with the objective of maintaining an adequate number of professional staff to execute the Company's strategy. For the first cycle, we focused on the executive levels and mapped potential successors to assume positions with the highest complexity levels; We developed and implemented the imdb (M. Dias Branco Corporate Governance Index), which offers relevant market references 2 for the progress of our Corporate Governance and internal control environment. Even with the growth in sales and EBITDA in 2017, when compared to the results of the previous year, we faced a year with unfavorable impacts due to the macroeconomic scenario and deflation in food prices, especially in wheat flour and bran and pasta segment. On the other hand, the cookies & cracker segment, which have higher added value products and are less sensible to changes in input prices, reported growth in volumes and increase in average price. The charts below illustrate our net revenue distribution and the annual evolution of the average price throughout the year per category. Average Price Variation by Product Line 15% 10% 5% 0% -5% -10% -15% Cookies and Crackers Pasta Wheat Flour and Bran Margarine and Vegetables Shortening Others Products 1Q17 vs. 1Q16 2Q17 vs. 2Q16 3Q17 vs. 3Q16 4Q17 vs. 4Q vs Total We also faced strong competition in the regular 3 pasta segment, especially in the Northeast and during 4Q17, with prices dropping to very low levels. Thus, it was necessary to adapt to this new scenario by repositioning our prices. We believe that, in addition drops in wheat prices, the fall in rice prices also contributed to lower pasta prices. Additionally, the reduction in average wheat prices caused lower wheat flour and bran prices, with the latter, which is also used as input for animal feed, being influenced by the drop of corn prices. The margarine & vegetable shortening segment reported a strong increase in net revenue when compared to 2016 (+25.5%), due to the expansion of the margarine production capacity and the successful sales and marketing initiatives. 1 Logistic service level is the quality with which the flow of goods and services is managed and customer requests are met. It is the result of all the company's logistical efforts. 2 Novo Mercado Regulation, Brazilian Corporate Governance Code - Publicly-Traded Companies, Dow Jones Sustainability Index and Business Sustainability Index. 3 Regular pasta is a traditional pasta category without semolina, consisting of wheat flour and water, which has lower prices than the other categories. 4

5 Our other product lines - cakes, snacks, cake mix and packaged toast - grew by 21.2% vs. 2016, particularly the toast line. In terms of profitability, even with a strong impact due to lower prices in pasta, wheat flour and bran, especially during the second half of the year, we ended 2017 with higher EBITDA and Net Income (nominal values and margins) when compared to the previous year. 17.3% 17.8% Ebitda Margin 2016 Evolution EBITDA Margin (%Net Revenue) 2017 vs % 2.0% Gross Margin* Selling Expenses Ebitda Margin 2017 EBITDA margin stood at 17.8% in 2017 (versus 17.3% in 2016), as a result of the increase in gross margin since the reduction in COGS was higher than the reduction in the average selling prices of products. On the other hand, selling expenses grew due to increased marketing investments, higher freight costs and external storage expenses needed to support growth outside the Northeast region, as well as expenses associated with ongoing improvements of our supply chain, which were important for the annual results and for our long-term strategy. * Note: % Gross margin excluding COGS depreciation on net revenue. In 4Q17, EBITDA margin was 14.2%, lower than the margin recorded in 4Q16 (17.2%), due to the decrease in gross margin and increase in selling expenses, as shown on the graph on the right. The reduction in gross margin was due to the fall in in prices of products, mainly pasta and wheat flour and bran, as well as the lower dilution of fixed costs due to collective vacations granted in the period. As sales expenses, as planned, we had higher investments in marketing, increase of our sales team in the South and Southeast regions, as well as adjustments in the expenses for the implementation of improvements in our supply chain. As for other operating expenses, they were * Note: % Gross margin excluding COGS depreciation on net revenue. ** Note: Refers to administrative expenses, administration fees, tax expenses and other operating expenses. impacted by legal and consultant fees, in the amount of R$3.5 million, related to the acquisition of Piraquê, which is under analysis by CADE. In 2017, our net income increased by 7.6%, generating net operating cash and cash equivalents of R$870.8 million (- 9.7% vs. 2016), with a 46.9% contraction of our debt and net cash of R$596.6 million (R$212.8 million in 2016) for the year. Thus, we remain confident of M. Dias Branco's growth potential, certain that we are making the necessary investments to expand our sales throughout the country, seeking customer satisfaction and value creation for shareholders, and convinced that the success achieved so far is essentially due to the dedication of our team of employees and partners, to which we offer our most sincere thanks. This team, even faced with a challenging scenario, they continue to work firmly to produce excellent quality food so that M. Dias Branco and all its brands are increasingly remembered and desired by our customers and consumers. 17.2% Ebitda Margin 4Q16 Evolution EBITDA Margin (%Net Revenue) 4Q17 vs. 4Q16 1.0% 1.5% 0.5% Gross Margin* Selling Expenses Others exp/ (net)operation 14.2% Ebitda Margin 4Q17 5

6 MARKET HIGHLIGHTS MARKET SHARE Until 2016, AC Nielsen market share data considered retailers only and, as of 2017, they have also included cash & carry outlets 4. The graph below shows the Brazilian market share (in % of sales volume) of M. Dias Branco, the national leader in the cookie & cracker and pasta markets, and its main competitors between January and December Market Share Cookies and Crakers* - Brazil (in % of volume sold) Market Share Pasta* - Brazil (in % of volume sold) Others 35.0% M Dias Branco 32.5% Others 30.2% M Dias Branco 32.4% Company E 5.0% Company D 5.7% Company B Company C 7.1% 6.6% * AC NIELSEN data from January to December of 2017 Company A 8.1% Company J 3.4% Company I 5.0% Company H 6.9% Company G 9.6% * AC NIELSEN data from January to December of 2017 Company F 12.5% SALES CHANNELS The table below shows the increased share of the cash & carry channel, which has been recording high growth rates in recent years with the opening of new stores in all the Brazilian regions It is also worth noting the upturn in the key account/regional network channels, following growth in direct service using our in-house sales force and the expansion of the space we occupy in these channels stores. Meanwhile, the reduction in the distributors channel was due to the termination of agreements with a few distributors, whose clients are now being served directly by the Company. Client Mix 4Q17 4Q16 Variation Variation Small Retail 23.8% 25.5% -1.7 p.p 24.8% 25.4% -0.6 p.p Wholesale 28.1% 29.3% -1.2 p.p 28.2% 28.7% -0.5 p.p Key Accounts / Regional Chains 19.7% 20.0% -0.3 p.p 20.5% 19.8% 0.7 p.p Cash and Carry 19.7% 16.0% 3.7 p.p 17.9% 16.2% 1.7 p.p Distributors 6.9% 7.3% -0.4 p.p 6.9% 7.9% -1 p.p Industry 0.9% 1.2% -0.3 p.p 1.0% 1.4% -0.4 p.p Other 0.9% 0.7% 0.2 p.p 0.7% 0.6% 0.1 p.p TOTAL 100.0% 100.0% 100.0% 100.0% Note: Client mix, considering gross revenue after discounts. It is important to mention that we revised the sales channels per client indicator in 1Q17 and, for comparison purposes, we adjusted 4Q16 and Cash & Carry: a sales channel that offers a hybrid business model, aimed at both the retailer (merchants, grocers) and individual consumers. 6

7 Major Clients Sequence Accumulated Individual Accumulated Individual Accumulated Major Client % 11.9% % 10.4% 49 Subsequent % 38.4% 1, % 37.4% 50 Subsequent % 45.9% % 44.9% 900 Subsequent 1, % 73.9% 1, % 72.9% Other Clients All clients % 100.0% % 100.0% TOTAL 1, ,582.0 * Gross Revenue excluding Discount Sales Sales 4Q17 (R$ million) * Participation in Gross Revenue excluding Discount Sales Sales 2017 (R$ million) * Participation in Gross Revenue excluding Discount Sales SALES VOLUME Sales ('000 tonnes) - Cookies and Crackers CQGR* 1.1% CQGR* 0.6% 88.2 Sales ('000 tonnes) - Pasta Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 *Compounded Quarterly Growth Rate Sales ('000 tonnes) - Wheat Flour and Bran Sales ('000 tonnes) - Margarine and Vegetable Shortening CQGR* 1.3% CQGR* 2.0% Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 *Compounded Quarterly Growth Rate 7

8 OPERATING HIGHLIGHTS 4Q17 AND 2017 EARNINGS RELEASE PRODUCTION CAPACITY UTILIZATION Effective Production / Production Capacity * Cookies and Crackers Pasta Wheat Flour and Bran Margarine and Vegetable Shortening Other products ** Total 4Q17 4Q16 4Q17 4Q16 4Q17 4Q16 4Q17 4Q16 4Q17 4Q16 4Q17 4Q16 Total Production Total Production Capacity Capacity Utilization 75.7% 80.5% 73.5% 84.2% 81.3% 85.5% 47.2% 85.1% 42.0% 51.1% 75.1% 83.9% * Thousand tonnes * * Cakes, snacks, cake mix and packaged toast Effective Production / Production Capacity * Cookies and Crackers Pasta Wheat Flour and Bran Margarine and Vegetable Shortening Other products ** 4Q17 3Q17 4Q17 3Q17 4Q17 3Q17 4Q17 3Q17 4Q17 3Q17 4Q17 3Q17 Total Total Production Total Production Capacity Capacity Utilization 75.7% 81.2% 73.5% 81.4% 81.3% 88.2% 47.2% 87.7% 42.0% 44.8% 75.1% 85.1% * Thousand tonnes * * Cakes, snacks, cake mix and packaged toast Effective Production / Production Capacity * Cookies and Crackers Pasta Wheat Flour and Bran Margarine and Vegetable Shortening Other products ** Total Total Production , , , ,626.8 Total Production Capacity , , , ,269.9 Capacity Utilization 76.5% 76.4% 77.5% 84.2% 82.9% 81.4% 70.4% 82.6% 43.5% 38.8% 79.4% 80.3% * Thousand tonnes * * Cakes, snacks, cake mix and packaged toast Note: Total production capacity refers to the maximum yield that can be extracted from the equipment, considering the losses caused by maintenance stoppages, setup time, line clean-up, restrictions on the maximum number of shifts in each plant, etc. The reduction in production capacity utilization in 4Q17 versus 4Q16 is due to lower production levels during the collective vacation period in several of the Company s operating units as inventory of finished products were sufficient to meet demand during the quarter. In addition, the increase in production capacity of margarines & vegetable shortening is due to the conclusion of the installation of the new deodorizer at the plant in Fortaleza (CE). Production Capacity ('000 tonnes) and Utilization Rate - Cookies and Crackers Production Capacity ('000 tonnes) and Utilization Rate - Pasta % 80.5% 72.1% 76.7% 81.2% 75.7% 83.9% 84.2% 78.8% 76.3% 81.4% 73.5% 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 Capacity Utilization Rate Capacity Utilization Rate Production Capacity ('000 tonnes) and Utilization Rate - Wheat Flour and Bran Production Capacity ('000 tonnes) and Utilization Rate - Margarine and Vegetable % 85.5% 79.5% 82.4% 88.2% 81.3% % 85.1% 82.9% 85.3% 87.7% 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 Capacity Utilization Rate 47.2% 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 Capacity Utilization Rate 8

9 VERTICAL INTEGRATION WHEAT FLOUR In 2017, the wheat flour vertical integration level stood at 92.1% (93.0% in 2016). This slight reduction was due to higher wheat flour needs at the Bento Gonçalves (RS) mill and in São Caetano do Sul (SP), both of which were also served by third-party wheat flour. Company's consumption Production allocation 8.3% 7.9% 7.8% 7.3% 8.7% 61.8% 59.6% 58.9% 60.3% 56.2% 91.7% 92.1% 92.2% 92.7% 91.3% 38.2% 40.4% 41.1% 39.7% 43.8% 4Q16 1Q17 2Q17 3Q17 4Q17 4Q16 1Q17 2Q17 3Q17 4Q17 OWN PRODUCTION EXTERNAL SOURCE SALE INTERNAL CONSUMPTION VEGETABLE SHORTENING The installation of a new deodorizer at the margarine & vegetable shortening unit in Fortaleza (CE) increased the production of these items and, consequently, increased the vertical integration of margarine & vegetable shortening. Company's consumption Production allocation 13.5% 15.6% 25.2% 22.2% 5.9% 53.4% 48.1% 43.8% 47.8% 49.7% Venda 86.5% 84.4% Consumo Interno 74.8% 77.8% 94.1% 46.6% 51.9% 56.2% 52.2% 50.3% 4Q16 1Q17 2Q17 3Q17 4Q17 4Q16 1Q17 2Q17 3Q17 4Q17 OWN PRODUCTION EXTERNAL SOURCE SALE INTERNAL CONSUMPTION Note: In the Company s consumption graphs, we show the origin of the wheat flour and vegetable shortening consumed in the period, with a breakdown of own output and purchases from third parties (external source). In the production destination graphs, we show the percentage of wheat flour and vegetable shortening that was allocated to sales and to the production of cookies & crackers and pasta, etc. (internal consumption) FINANCIAL AND ECONOMIC HIGHLIGHT NET REVENUE In 2017, our net revenue reached R$5,415.4 million, up by 1.6% when compared to 2016, with increase in sales volume by 2.5% and decreases in average prices by 1.0%. 9

10 Segment Net Revenue Weight Average Price Net Revenue Weight Average Price Variation Net Average Weight Revenue Price Cookies and Crackers 2, , % 1.3% 3.2% Pasta 1, , % -0.4% -3.3% Wheat Flour and Bran , % 2.8% -10.7% Margarine and Vegetable Shortening % 19.4% 5.1% Other products ** % 25.6% -3.5% TOTAL 5, , , , % 2.5% -1.0% * Net Revenue in R$ million, Weight excluding sales returns in thousand tonnes and Net Average Price in R$/Kg. ** Cakes, snacks, cake mix and packaged toast The reported sales growth in 2017 demonstrates our capacity to adapted to the still challenging macroeconomic scenario in Brazil. The chart illustrates that our greatest challenge was in the pasta, wheat flour and bran segments, due to several factors, such as deflation of food prices and lower prices of substitute items for pasta and bran, which are rice and corn, respectively. It is important to note that our base of comparison in 2017 was difficult as 2016 was a year of high growth in sales volume accompanied by higher readjustments in prices. Net Revenue Variation(R$ million) , , ,622.2 Net Revenue of 2015 Cookies and Crackers Pasta Wheat Flour and Bran Margarine and Vegetables Shortening Others Products Net Revenue of 2016 Cookies and Crackers Pasta Wheat Flour and Bran Margarine and Vegetables Shortening Others Products Net Revenue of 2017 The net revenue growth in 2017 was mainly due to the following initiatives: Launching of new products: we launched the Adria Plus Life wholemeal cookie line, new flavors of cake mixes (coconut and festa), Treloso mega wafers under the Vitarella brand, Triwafer coated wafers under the Isabela brand, new vanilla a chocolate flavored cookies under the Isabela brand and new cuts/types of pasta under the Vitarella brand; Higher marketing investments: we executed several 360º marketing campaigns (traditional media, social networks and personal interactions at retail establishments), offered incentives to over 2,400 sales promotors with a focus on earning extra slots with our largest clients, increased the number of fixed tasting stations at retail establishments, and updated our packaging to reinforce the positioning of our brands; Price policy: we reduced the prices for pasta, wheat flour and bran given the deflation scenario of food prices and competition by substitute products, being rice for pasta and corn for bran. For the cookies & crackers and margarines & vegetable shortening lines, we increased volume with increases in average prices; Reinforcement of our sales team: we terminated contracts with some of our representatives and reinforced the sales teams in the South and Southeast regions. During 2017, we also had greater synergy within the sales teams, as they offered the Company's complete product portfolio, including wheat flour, margarines and vegetable shortening. Segment Net Revenue Weight Average Price Net Revenue Weight Average Price Net Average Weight Revenue Price Cookies and Crackers % -1.0% 2.7% Pasta % -4.7% -7.2% Wheat Flour and Bran % 2.2% -11.0% Margarine and Vegetable Shortening % 20.7% -2.3% Other products ** % -2.2% 2.3% TOTAL 1, , % 0.5% -3.0% * Net Revenue in R$ million, Weight excluding sales returns in thousand tonnes and Net Average Price in R$/Kg. ** Cakes, snacks, cake mix and packaged toast 4Q17 4Q16 Variation 10

11 As for 4Q17, when compared to the same period of the previous year, net revenue fell by 2.6% in 4Q17, with a 0.5% growth in volume and 3.0% reduction in average price. Even with a more challenging comparison base (4Q16), due to the strong performance we had last year, we maintained growth in volumes for the wheat flour and bran, and the margarine & vegetable shortening lines, resulting from price readjustments, integrated sales force and marketing investments. Net Revenue Variation(R$ million) 111 1, ,2 19,4 9,1 15,5 12,7 37,7 24,5 12,6-1, ,199.6 Net Revenue 4Q15 Cookies and Crackers Pasta Wheat Flour and Bran Margarine and Vegetables Shortening Others Products Net Revenue 4Q16 Cookies and Crackers Pasta Wheat Flour and Bran Margarine and Vegetables Shortening Others Products Net Revenue 4Q17 When comparing 4Q17 vs. 3Q17, net revenue fell by 7.2%, with a reduction of 5.2% in volume and 2.0% in total average price. 4Q17 3Q17 Variation Net Average Net Average Net Average Segment Weight Weight Weight Revenue Price Revenue Price Revenue Price Cookies and Crackers % -7.4% -2.4% Pasta % -6.4% -2.2% Wheat Flour and Bran % -3.7% 5.0% Margarine and Vegetable Shortening % -4.0% -1.8% Other products ** % 4.8% -7.1% TOTAL 1, , % -5.2% -2.0% * Net Revenue in R$ million, Weight excluding sales returns in thousand tonnes and Net Average Price in R$/Kg. ** Cakes, snacks, cake mix and packaged toast Net Revenue (R$ million) and Net Volume ('000 tonnes) 1, , , , , , , , , Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 Net Revenue Volume As illustrated in the charts below, the initiatives taken towards accelerating growth outside of the Northeast region have brought us good results. These regions represented 31.8% of total sales in 4Q17 (30.0% in 4Q16) and 30.2% in 2017 (28.7% in 2016). 11

12 When comparing 2017 with 2016, we reported a growth in export revenues, selling to 25 countries (19 countries in 2016), reaching a gross revenue of R$35.0 million (+22.0% vs. 2016), especially for the cookies & crackers line. Sales by Region (% Gross Revenue excluding Discounts and sales returns) 0.5% 0.4% 0.5% 0.4% 3.1% 3.0% 3.0% 2.8% 4.3% 4.4% 3.9% 4.1% 6.5% 6.4% 6.4% 6.1% 17.4% 15.8% 16.4% 15.3% 68.2% 70.0% 69.8% 71.3% Export Midwest North South Southeast Northeast Net Revenue Breakdown 2.6% 2.5% 2.6% 2.2% 6.1% 5.0% 6.0% 4.9% Other products 17.0% 18.3% 17.0% 18.8% Margarine and Vegetable Shortening 20.9% 23.0% 21.4% 22.6% Wheat Flour and Bran Pasta Cookies and Crackers 53.4% 51.2% 53.0% 51.5% 4Q17 4Q Q17 4Q HIGHLIGHTS - COOKIES & CRACKERS The cookies & crackers line reported a net revenue growth of 4.5% in 2017 when compared to 2016 (volume +1.3% and average price +3.2%), with highlights to the 9.6% growth outside the Northeast region and the good results of new product launches. As for the launching of new products, in 2017 we recorded R$125.6 million in gross revenue in launches made over the past 24 months, 76.7% higher than the amounts recorded in In 4Q17, our gross revenues with 65 new products/flavors of cookies & crackers launched over the last 24 months, totaled R$34.3 million (66 new products/flavors and gross revenue of R$28.8 million in 4Q16). Cookies and Crakers - Net Revenue (R$ million) and Net Volume ('000 tonnes) Net Revenue Volume Highlights for he Adria Plus Life line of cookies, which was launched in May 2017 and which in December of that year already held the fourth national position in the functional biscuit segment and the third position in the Northeast region. We also launched Vitarella Treloso Mega cookies (August/17), Triwafer coated wafers cookies under the Isabela brand (September/17) and additional cookies also under the Isabela brand (October/17), all with high added value. As for the 4Q17 vs. 4Q16 comparison, net revenue grew by 1.8%, with a volume reduction of 1.0%, mainly in the salt & water/cream cracker and wafer products. We recorded an average price increase of 2.7% in 4Q17 vs. 4Q16 due to the price readjustment that took place during 2016 and It is also important to highlight the growth in volume in higher value added cookies, such as coated cookies, which had double-digit growth Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 12

13 HIGHLIGHTS - PASTA In 2017, net revenue from pasta decreased by 3.7% (volume -0.4% and average price -3.3%). In this segment, we highlight the positive sales growth in the South and Southeast regions and, on a national level, for higher value added products such as egg based pasta, instant noodles and grano duro pasta. Instant noodles presented a double-digit sale growth, mainly in Bahia and Pernambuco, due to a series of commercial and marketing initiatives carried out in recent months, such as: "buy and win", cookbooks, displays, and hotsites, among others. Pasta - Net Revenue (R$ million) and Net Volume ('000 tonnes) Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 Net Revenue Volume On the other hand, the regular pasta segment which is traditionally more sensitive to commodity price swings, became more competitive in 2017 causing a decline in our average price due to necessary price adjustments in order to expand sales volume. In addition, the pasta category, in general, may have been impacted by falling prices in rice. When comparing 4Q17 vs. 4Q16, we had a decrease of 11.7% in net revenue for pasta due to the drop of average price by 7.2% and by 4.7% in volumes. These drops were mainly for regular pasta and semolina pasta. HIGHLIGHTS - WHEAT FLOUR AND BRAN In 2017 vs. 2016, net revenue from wheat flour and bran fell by 8.4% (volume +2.8% and average price -10.7%). The growth in sales volume was observed in industrial flour and, even more sharply, in domestic flour due to our marketing and sales efforts since 2016, such as the "with Finna gets right" campaign which took place during 2Q17 and 3Q17 in the Northeast region. Wheat Flour and Bran - Net Revenue (R$ million) and Net Volume ('000 tonnes) Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 Net Revenue Volume The average price of wheat flour & bran suffered with the price drop of wheat grain, and bran was particularly impacted by the fall in corn prices, which competes directly with bran as animal feed. When comparing 4Q17 vs. 4Q16, net revenue from wheat flour & bran decreased by 9.6% (volume +2.2% and average price -11.0%). Comparing 4Q17 vs. 3Q17, net revenue from wheat flour & bran increased by 0.9%, due to an increase of 5.0% in average price, which offset the 3.7% decrease in volumes. The evolution in average price reflects the increase in bran prices during the period. 13

14 HIGHLIGHTS - MARGARINE AND VEGETABLE SHORTENING In 2017, net revenue from margarine & vegetable shortening increased by 25.5% when compared to 2016 (+18.0% 4Q17 vs. 4Q16), with a 19.4% increase in sales volume (+20.7% 4Q17 vs. 4Q16) and a 5.1% increase in average price (contraction of 2.3% 4Q17 vs. 4Q16). Margarine and Vegetable Shortening - Net Revenue (R$ million) and Net Volume ('000 tonnes) The accelerated growth in the margarine & vegetable 16.9 shortening category is mainly due to the higher sales efficiency that resulted from the restructuring carried Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 out in 2016, and which intensified in 2017, when Net Revenue Volume margarine & vegetable shortening products began to be distributed by the sales teams responsible for the pasta and cookies segments, creating a more capillary distribution. In addition, we expanded our vegetable shortening production capacity in 4Q17 by installing the new deodorizer at the margarine & vegetable shortening unit in Fortaleza (CE), thus ensuring greater vertical integration destined for sales of our Puro Sabor, Medalha de Ouro, Amorela and Adorita brands. COSTS Operating Costs (R$ million) 4Q17 % Net Rev. 4Q16 % Net Rev. Variation 3Q17 % Net Rev. Variation 2017 % Net Rev % Net Rev. Variation Raw material % % -4.3% % -5.5% 2, % 2, % -5.7% Wheat % % -1.5% % -2.7% 1, % 1, % -10.7% Vegetable Oil % % -2.6% % 3.3% % % 1.2% Sugar % % -28.6% % -17.8% % % -7.5% Third Party Flour % % -4.2% % -4.2% % % -16.7% Third Party Vegetable Shortening % % -41.5% % -69.4% % % 133.0% Other % % 3.3% % -6.1% % % 6.7% Packages % % 2.4% % -4.0% % % 5.7% Labor % % 8.2% % 4.6% % % 3.5% Indirect costs % % 9.4% % -1.1% % % 2.3% Depreciation and amortization % % 14.3% % 3.8% % % 8.4% Total % % -0.3% % -3.3% 3, % 3, % -2.2% In the comparison between 2017 and 2016, cost of goods sold (COGS) reduced by 2.2% in absolute terms (-2.5 p.p. of net revenue). This result is due to a set of favorable and unfavorable factors, as described below: Reduction of the average cost of consumed wheat in reais (-11.1%), mainly due to exchange rate. In addition, in 2017, we used a greater proportion of Argentine and national wheat instead of US wheat, which has a higher cost; Lower average cost of consumed vegetable oil in reais (-1.9%), due to the increased use of crude oil in substitute of refined oil, which has a higher cost; Decrease in the average cost of sugar (-11.5%), driven by the expectation of a surplus in world sugar production in the 2017/2018 harvest season, after two consecutive deficit cycles; Increase in labor costs resulting from salary readjustments, in line with inflation, by collective agreements; Increase in depreciation expenses, as a result of the start of a new cereal bit production line at the Maracanaú (CE) plant in Apr/17, a cookies & crackers line in Bento Gonçalves (RS) in June/17, a pasta line in São Caetano do Sul (SP) in May/17, and a margarine & vegetable shortening line at the Fortaleza (CE) plant in Sep/17. 14

15 In 4Q17, COGS were 0.3% lower than those recorded in 4Q16, in absolute terms, and accounted for 64.8% of net revenue for the period (63.3% in 4Q16). The variation in the representativeness over net revenue is due to lower average prices of 3.0% in the period and to the following other factors: A slight increase in average cost of consumed wheat (+0.1%), due to the increase in the tax rates of this item, which was mitigated by the fall in wheat prices in US dollar and the appreciation of the real in the period; Reduction in the average cost of vegetable oil in reais (-8.2%) and a 32.7% drop in sugar costs; Lower dilution of fixed costs (labor, general expenses and depreciation) due to the reduction in volumes produced mainly in the cookies and pasta. When comparing COGS in 4Q17 vs. 3Q17, we see an increase of 2.6 p.p. in its representativeness over net revenue, basically due to the reduction of average prices by 2.0%, a decrease in production volumes causing lower fixed cost dilution, mainly for cookies and pasta, and an evolution of the average cost of consumed wheat, in reais of 2.2% US$ WHEAT Average purchase price M. Dias Branco X Market price US$ / TON 2016 and Jan-16 Mar-16 May-16 Jul-16 Sep-16 Nov-16 Jan-17 Mar-17 May-17 Jul-17 Sep-17 Nov-17 Dec-17 * Source: Market* SOYBEAN OIL Average purchase price M. Dias Branco X Market price PALMA OIL R$ / TON Average purchase price M. Dias Branco X Market price 2016 and 2017 US$ US$ / TON R$ 2016 and ,500 3,395 3,320 3, ,268 3,275 3,300 3,222 3,199 3,153 3,160 3,187 3,118 3,219 3,053 3,100 3,022 3, ,109 2,950 2,963 2, ,110 3,088 2,910 2, ,921 2,908 3, ,900 3,011 2,995 2, , ,919 2, ,762 2,792 2,792 2,799 2,812 2,822 2, ,740 2,726 2,758 2,775 2,7912, ,706 2, ,663 2, , Jan-16 Mar-16 May-16 Jul-16 Sep-16 Nov-16 Jan-17 Mar-17 May-17 Jul-17 Sep-17 Nov-17 Dec-17 Jan-16 Mar-16 May-16 Jul-16 Sep-16 Nov-16 Jan-17 Mar-17 May-17 Jul-17 Sep-17 Nov-17 Dec-17 M. Dias MONTH * Source: Market* M. Dias MONTH * Source: Braincorp Market* M. Dias MONTH GROSS PROFIT In 2017 vs. 2016, due to volume growth and the reduction in COGS having been higher than the reduction of average prices, we reported a 7.8% increase in gross profit, in nominal terms, and a 2.4 p.p. growth as a percentage of net revenue (gross margin). 15

16 When comparing 4Q17 vs. 4Q16, as well as 4Q17 vs. 3Q17, we report a reduction in gross profit, in nominal terms, and a reduction as a % of net revenue (gross margin), influenced by lower average prices, a decrease in production volumes causing lower fixed cost dilution, mainly for the cookies and pasta lines, and an increase in tax rate for wheat % 33.4% Gross Profit (R$ millions) and Gross Margin (%) Gross profit for 2017 includes the effects of the ICMS 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 Protocol 80/2016, which amended Protocol 46/2000, increasing ICMS tax on the purchase of gain wheat, 33% GROSS PROFIT GROSS MARGIN to 40%, as of April 1, Thus, an increase in the cost of wheat consumed by the Company's industrial units, located in the Northeast region, was reported. This effect was partially offset by the increase in the calculation basis of subsidies for state investments Additionally, it should be noted that gross profit includes subsidies for state investments, in the amount of R$213.5 million in 2017 (R$214.8 million in 2016) and R$56.6 million in 4Q17 (R$54.0 million in 4Q16; R$61.3 million in 3Q17), which passed through the result in compliance with CPC 07 - Government Grants. The behavior of state government subsidies in the periods was influenced by the variation in wheat consumption and its average cost % 42.3% 40.6% 42.6% 42.3% 42.0% % OPERATING EXPENSES To provide a better understanding of the variations in operating expenses, we report depreciation and amortization expenses and tax expenses separately, as illustrated below: Operating Expenses (R$ million) 4Q17 % Net Rev. 4Q16 % Net Rev. Variation 3Q17 % Net Rev. Variation 2017 % Net Rev % Net Rev. Variation Selling % % 4.7% % 2.5% 1, % % 12.4% 2 p.p Administrative % % 10.4% % 15.7% % % 6.2% 0.2 p.p Management fees % % 12.1% % 19.4% % % 6.8% 0 p.p Taxes % % 39.7% % 44.6% % % 13.6% 0 p.p Depreciation and amortization % % 8.3% % 3.2% % % 3.3% 0 p.p Other operating expenses/(revenue) % % -14.1% % 1.7% % % -12.5% -0.2 p.p TOTAL % % 5.0% % 4.9% 1, % 1, % 9.7% 1.9 p.p *Salaries and benefits, freight and other expenses with marketing, sales force and logistics. % Net Rev. Operating expenses totaled R$1,409.7 million in 2017 (+9.7% vs and +1.9 p.p. over net revenue) with the increase being a result of the following: (i) higher marketing investments; (ii) sales team expansion for the South, Southeast and Export regions; (iii) higher logistics expenses due to higher freight rates and because we increased deliveries to more distant regions; (iv) supply chain advisory services, (v) increased inventory transfers between industrial and distribution units and outsourcing of warehouses to store products; and (vi) salary and health plan readjustments. Other operating revenue and expenses reached a total expense amount of R$75.5 million in 2017 (R$86.3 million in 2016). Among the events for the period, we highlight provisions/reversals for civil, labor, and tax claims, as well as success fees and estimated losses of tax credits: R$50.7 million (R$39.4 million in 2016); and Contribution to the State Fiscal Balance Fund (FEEF - Fundo Estadual de Equilíbrio Fiscal): R$17.4 million (R$7.5 million in 2016, initiated in August). On the other hand, we had recognition of extemporaneous tax credits of R$17.3 million (R$11.5 million in 2016). 16

17 In 4Q17, operating expenses totaled R$375.4 million (+5.0% vs. 4Q16 and +2,0 p.p. over net revenue). The ratio over net revenue increase was influenced by the Company s lower average prices in 3.0% during the period, the increase of expenses already mentioned in the annual analysis and by expenses related to legal services in the amount of R$3.5 million as a result of the acquisition of Piraquê, which is currently under analysis by CADE. 25.5% Operating Other expenses Expenses 4Q16 with marketing, sales and Logistic Evolution Operating Expenses (% Net Revenue) 4Q17 vs. 4Q16 0.8% 0.4% 0.6% 0.2% Freights Expensives Salaries and Employee Benefits Expenses Others expenses/(net) operating 27.5% Operating Expenses 4Q % Operating Expenses 3Q17 Evolution Operating Expenses (% Net Revenue) 4Q17 vs. 3Q17 1.2% 0.3% Other expenses with marketing, sales and Logistic Freights Expensives 0.8% 0.9% Salaries and Employee Benefits Expenses Others expenses/(net) operating 27.5% Operating Expenses 4Q17 When compared to 3Q17, we reported an increase on the operating expense ratio over net revenue, which went from 24.3% in 3Q17 to 27.5% in 4Q17, reflected by the reasons already mentioned, mainly the reduction in average price, higher marketing investments, outsourcing of warehouses to store products and expenses related to the acquisition of Piraquê. FINANCIAL RESULTS To provide a better understanding of the variations in the financial result, we report and analyze exchange variations and swap operations in the period separately from financial income and expenses, as shown below: Financial Income (R$ million) 4Q17 4Q16 Variation 3Q17 Variation Variation Financial Revenue % % % Financial Expenses % % % Exchange Variation % % % Losses/Gains on swaps % % % TOTAL % % % Financial result went from a financial revenue of R$31.6 million in 2016 to a financial revenue of R$76.7 million in 2017, mainly due to income from a higher volume of financial investments during the period due to the start of the readjustments to the balances of judicial deposits and the contingencies guaranteed by such deposits, which had a positive effect of R$12.1 million in 4Q17, and the decrease in debt based on the decision to not finance imports of inputs (in particular wheat and oil) during 2017, given the high contractual costs of hedge operations for protection against foreign risk currency for such financings. In 4Q17, we reported a financial revenue of R$23.9 million (R$15.6 million in 4Q16 and R$13.6 million in 3Q17), for the reasons already mentioned. It is worth mentioning that M. Dias Branco is reiterating its commitment to a conservative policy by maintaining swap contracts, through which the foreign exchange risk plus a pre-fixed rate is swapped for a percentage of the CDI rate to hedge input imports and fixed assets, which are recognized at fair value and whose results are booked under the financial result. 17

18 TAXES ON INCOME Income and Social Contribution Taxes (R$ million) In 2017, total income and social contribution taxes increased 22.5% compared to 2016, due to the growth of results in the year, mainly related to the financial result, impacting on a higher taxable income in The value of the tax incentive presented a lower growth of 9.5%, since part of the increase in taxable income was due to the increase in the financial result, which does not constitute the basis for calculating this incentive. Thus, in 2017, the net amount of income and social contribution taxes increased 49.2% compared to In the quarter, total income and social contribution taxes changed from a reversal of R$9.5 million in 4Q16 to a reversal of R$17.4 million in 4Q17. This variation was due to a lower result in 4Q17, when compared to 4Q16. Another factor that contributed to the reduction in the calculation base in the quarter was the increase in interest on shareholders equity in 4Q17 compared to the same period of the previous year. As for the incentive to reduce income tax, there was a 33.3% decrease compared to 4Q16, due to the increase in the state subsidies in 4Q17 and also due to the increase in the financial result, which does not make up the calculation basis of the incentive. Goodwill amortization has been prohibited since January However, this procedure has not modified the tax effects of the amortization of goodwill, which has since been made in accordance with the tax legislation that regulates the matter. In this context, as required by CPC 32 Income Taxes (CVM Resolution 599/2009), M. Dias Branco constitutes deferred tax obligations from this amortization under income and social contribution tax expenses, even though it does not believe in the possibility of future realization of this obligation. In 4Q17, M. Dias Branco reported income and social contribution taxes, of R$4.0 million (R$5.7 million in 4Q16). EBITDA AND NET INCOME 4Q17 4Q16 Variation Variation Income and Social Contribution Taxes % % Income Tax Incentive % % TOTAL % % Period Schedule of realization of tax credits arising from the amortization of goodwill (R$ million) TOTAL 26.1 EBITDA NET INCOME EBITDA CONCILIATION (R$ million) 4Q17 4Q16 Variation 3Q17 Variation Variation Net Profit % % % Income Tax and Social Contribution % % % Income Tax Incentive % % % Financial Revenue % % % Financial Expenses % % % Depreciation and Amortization of cost of goods % % % Depreciation and Amortization Adm/Com Expenses % % % EBITDA % % % EBITDA Margin 14.2% 17.2% -3 p.p 19.8% -5.6 p.p 17.8% 17.3% 0.5 p.p 18

19 EBITDA NET REVENUE EBITDA CONCILIATION (R$ million) 4Q17 4Q16 Variation 3Q17 Variation Variation Net Revenue 1, , % 1, % 5, , % Cost of goods sold % % -3, , % Depreciation and Amortization of cost of goods % % % Operating Expenses % % -1, , % Depreciation and Amortization Adm/Com Expenses % % % EBITDA % % % EBITDA Margin 14.2% 17.2% -3 p.p 19.8% -5.6 p.p 17.8% 17.3% 0.5 p.p Net Profit (R$ millions) and Net Margin (%) EBITDA (R$ millions) and EBITDA Margin (%) % % % 15.7% 14.5% 14.8% 13.9% 10.2% 8.2% 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q % 17.2% 19.3% 18.0% 19.8% 17.4% 14.2% 11.1% 11.6% 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17 4Q17 Net Income Net Margin EBITDA EBITDA Margin DEBT, CAPITALIZATION AND CASH Capitalization (R$ million) 12/31/ /31/2016 Variation Short Term % Long Term % Total Indebtedness % (-) Cash % (-) Financial Investments Short Term % (-) Derivatives Financial Instruments % (-) Financial Investments Long Term % (=) Net Debt % Shareholder's Equity 4, , % Capitalization 5, , % Financial Indicator 12/31/ /31/2016 Variation Net Debt/EBITDA (last 12 months) Net Debt/Shareholder's Equity -12.0% -4.9% -7.1 p.p Indebtedness/Total Assets 5.6% 11.3% -5.7 p.p M. Dias Branco did not have liabilities pegged to foreign currencies at the end of 4Q17 (R$244.4 million in 4Q16). The amounts reported in 4Q16 were related to input imports, which are hedged by swap contracts, which the foreign exchange risk plus a prefixed rate is swapped for a percentage of the CDI rate (100.85% of the CDI on 12/31/2016). The Company uses swap contracts to hedge foreign exchange risk for transaction involving import of inputs. These contracts are recorded at fair value through profit or loss and consist of exchange rate risk plus pre-fixed rate per CDI percentage. In 2017, we settled existing swap contracts with no new hires, given the wheat and oil spot purchase strategy, as previous mentioned. 19

20 Consolidated Debt (R$ million) Index Interest (year) 12/31/2017 % Debt 12/31/2016 % Debt Variation Domestic Currency: % % -14.4% BNDES - FINAME TJLP 3.15% (3.53% in 12/31/16) % % n/a BNDES - PSI R$ 4.86% (4.80% in 12/31/16) % % -14.8% BNDES - PSI URTJLP 6.42% (6.47% in 12/31/16) % % -33.3% (PROADI) Financing of state taxes TR - 0.0% % % (PROVIN) Financing of state taxes TJLP % % 75.6% (DESENVOLVE) Financing of state taxes TJLP % % -93.6% BNB-FNE - Financing Flat rate 8.2% % % -16.1% Investment of assigment of Pilar's shares 100% CDI % % -28.4% Investment of assigment of Estrela's shares 100% CDI % % -46.4% Investment of assigment of Moinho Santa Lúcia's shares 100% CDI % % -16.1% Financial Lease 2.7% % % -63.6% Foreign Currency: - 0.0% % % (FINIMP) Imports financing USD (2.68% in 12/31/16) - 0.0% % % TOTAL % % -46.9% We ended 2017 with cash and cash equivalents of R$925.9 million (R$860.1 million in 2016). Net cash generated by operating activities totaled R$870.8 million in 2017 (R$964.2 million in 2016), as illustrated on the following chart. R$ Millions 16,1% da Receita Líquida Net Cash on Dec-16 Net Cash from Payment of operating activities property and software licenses Financing activities Dividends (interest on own capital) Payment /Acquisition of Equity Interest Redeem long-term financial investment Net Cash on Dec-17 INVESTMENTS Investments (R$ Million) 4Q17 4Q16 Variation Variation Investments 4Q17 - R$ 74.7 million Buildings % % Machinery and equipment % % Construction in progress % % Vehicles % % IT Equipment % % Furniture and Fixtures % % Land % % Others % % Total % % Capacity Expansion 47.9% Maintenance 52.1% 20

21 Investments totaled R$307.1 million in 2017 (R$263.9 million in 2016), distributed between expansion and maintenance. Among the items that were part of the investments in 2017, we highlight: (i) installation of equipment and construction in progress at the new milling unit in the city of Bento Gonçalves (RS); (ii) expansion of the warehousing capacity of the distribution center in Maracanaú (CE); (iii) acquisition and installation of a deodorizer and oil bleaching equipment at the margarine & vegetable shortening unit in Fortaleza (CE); (iv) technological update of the data centers for increased information security and unlimited Oracle EBS system license acquisition; (v) grain reception remodeling, capacity increase and modernization of the Paraná mill; and (vi) implementation of the OTM (Oracle Transportation Management) module. CAPITAL MARKET The Company s shares are traded on the B3 (Brasil, Bolsa e Balcão) under the ticker MDIA3 and are listed in the Novo Mercado segment. On March 2, 2017, there were 85,093,565 outstanding shares, representing 25.10% of the Company s capital stock, priced at R$57.40 each, totaling R$4,884.4 million. The average number of trades in 2017 was 2,375 (919 in 2016) and the average daily trading volume came to R$25.6 million in 2017 (R$15.1 million in 2016). Focused on increasing our liquidity, we hired a market maker service in early 2017 and the Company s shares had a stock split in Apr/17, with one (1) existing common share corresponding to three (3) common shares. Average Daly Volume : MDIA3 (R$ Millions) MDIA x IBOV x IGC 01/02/2017 a 03/02/2018 Profitability% 60% 50% 40% 30% 20% 10% 0 jan-17 feb-17 mar-17 apr-17 may-17 jun-17 jul-17 aug-17 sep-17 out-17 nov-17 dez-17 jan-18 feb-18 mar-18 0% Volume (Millions) MDIA3 IBOV IGC SOCIAL AND ENVIRONMENTAL HIGHLIGHTS M. Dias Branco has been reinforcing its commitment to Sustainability through Working Groups focused on strengthening sustainable practices in several areas of the business. We would like to point out some of the initiatives undertaken in the fourth quarter of 2017, such as: (i) establishing actions aiming to expand our water reuse system; (ii) establishing specific actions to reduce waste sent to landfill; (iii) prospecting of suppliers for 100% recycled baling films; (iv) donations to institutions throughout Brazil; and (v) internal and external actions on the nutrition and health themes at schools near the manufacturing units of the state of Ceará. 21

22 Analysis of Indicators Indicators 4Q17 4Q16 Variation Variation Energy intensity (Kwt/ton) % % Water consumption (m 3 /ton) * % % Occupational accident frequency rate (%) % % * With the inclusion of the w heat flour and bran Energy intensity The variations reported in relation to 2016 are related to the the production mix and the tests carried out as part the installation process of the new deodorizer in the margarine & vegetable shortening unit in Fortaleza (CE). Water consumption The reduction in water consumption (m 3 /ton) was the result of several awareness-raising actions promoted by the Company, including lectures and internal campaigns for the rational use of water, in addition to other initiatives, including the reuse of water to supply factory restrooms, wash the external area and water gardens, and the reuse of water from cooling towers to wash silos and employee training on conscious consumption. Other factors that contributed to this reduction include the installation of flow restrictors in showerheads and faucets, and the replacement of underground water piping with overhead piping in the Cabedelo unit, minimizing water waste and facilitating preventive maintenance. Frequency rate of occupational accidents When comparing 2017 to 2016, this rate reduced by 25.8%, and improvement was due to campaigns focused on raising employee awareness about existing risks and strong management involvement in the development of an occupational safety culture in the Company through the implementation of the Positive Program. Other initiatives and achievements Approval of projects in gastronomy, music, dance, sport, health and art for communities closely located to the production units; Execution of volunteer programs in all production units; Execution training for employees through the Sustainability partners; Implementation of thermal comfort plans at the Jaboatão dos Guararapes/PE unit. We emphasize that the 2017 Annual Report provides full disclosure of all socio-environmental actions carried out by the Company during the year. Please refer to the report for more detailed information. We believe that, through these actions, we will build a culture of sustainability that, over time, will make social and environmental aspects increasingly integrated into the decision-making process and focused on value generation. 22

23 ADMINISTRATIVE HIGHLIGHTS In November 2017, we began the online commercialization of Richester Animados Zoo cookies. Our e-commerce contains a portfolio of 20 items, among them sweet cookies, stuffed cookies, covered cookies, wafers, mini cakes and wafers covered in milk chocolate, all in varied sizes and flavors, and this will be the new channel to contribute with further enhancement and direct relationship with the public. The brand, which had only regional distribution, will now be offered Nationwide through the website M. Dias Branco presented itself to the global market during PLMA's - Private Label Trade Show PLMA is a non-profit organization founded in 1979 and promotes own-brand sales, with over 4,000 member companies throughout the world. Aiming to help member companies become more competitive globally, PLMA sponsors a "World of Private Label" International Fair, with the last one being from November 12-14, 2017 in Chicago, USA. Also in November, 16 young individuals were hired for the M. Dias Branco Trainee Program. The 12-month program seeks to develop the technical and behavioral aspects, through job rotations with these two aspects in mind, focusing on the business and addressing its challenges. After this period, the trainees are expected to be able to take on strategic positions, with an integrated view of the Company, starting from a knowledge of the business to each trainee s individual development. At the Board of Directors' Meeting held on December 18, 2017, the amount of R$132,370, (one hundred thirtytwo million, three hundred and seventy thousand reais) was approved to be distributed as interest on equity ("JSCP"), proportional to shareholders stake in the Company s capital stock. JSCP per share came to R$ and the credit date was 12/29/2017 based on the stakes held at the closing of B3 s trading session on December 21, Payment to shareholders will be on 04/27/