COSAN S/A 3rd Quarter of the Fiscal Year of 2017

Transcription

1 COSAN S/A 3Q17 Earnings Release São Paulo, November 10, 2017 COSAN S/A INDÚSTRIA E COMÉRCIO (B3: CSAN3) announces today its results for the second quarter (July, August, and September) of 2017 (3Q17). The results are presented on a consolidated basis, in accordance with the accounting practices adopted in Brazil and with International Financial Reporting Standards (IFRS). Comparisons in this report take into consideration 3Q17 and 3Q16, except where indicated differently. 3Q17 Highlights Cosan posted pro forma adjusted EBITDA of R$1.6 billion (+28%) and net income of R$500 million. Cosan s Operational Cash Flow (OCF), considering 50% of Raízen s results, reached R$817 million in the period. Leverage (net debt/pro forma EBITDA) was stable at 2.1x. Raízen Combustíveis posted adjusted EBITDA of R$894 million (+21%) with 4% growth of total sales volume. Raízen Energia accelerated pace of cane crushing during the second quarter of the crop, with 28 million tons of crushed cane. Adjusted EBITDA came to R$1.4 billion (+50%) in 3Q17. Comgás posted normalized EBITDA of R$477 million (+6%) with higher volume sold in all segments. Executive Summary - Cosan Pro forma¹ 3Q17 3Q16 Chg. % 2Q17 Chg. % BRL mln (Jul-Sep) (Jul-Sep) 3Q17/3Q16 (Apr-Jun) 3Q17/2Q17 Net Revenue 12, , % 11, % Gross profit 1, , % 1, % EBITDA 1, , % % Adjusted EBITDA² 1, , % 1, % Net Income (Loss) % (76.0) n/a Adjusted Net Income n/a 24.5 n/a CAPEX % % Cash Generated (Used) 3 (518.6) n/a n/a Net Debt 4 9, , % 9, % Leverage (Net Debt/EBITDA LTM) 5 2.1x 2.2x -0.1x 2.1x 0.0x Dividend Announced - - n/a % Note 1: Considering 50% of the results of Raízen Combustíveis and Raízen Energia Note 2: Adjusted Net Income (Loss) and EBITDA excludes non-recurring effects in the quarters, as detailed on page 5 herein. Note 3: Cash Flow to shareholders, before Dividends paid (Free Cash Flow to Equity). Note 4: Includes obligations with preferred shareholders on subsidiaries. Note 5: Considering Net Debt and EBITDA LTM normalized by Comgás' current account effects. Earnings Conference Call on November 13, 2017 (Monday) English 12:00 p.m. (Brasília time) Dial-in (BR): Dial-in (USA): Code: COSAN Portuguese 11:00 a.m (Brasília time) Dial-in: Code: COSAN Investor Relations ri@cosan.com.br Tel: Website: ri.cosan.com.br 1 de 23

2 A.Cosan - Consolidated Results Business Units Aiming at enabling the comparison of results in relation to previous period, we present consolidated financial information on a pro forma basis, i.e., 100% consolidation of direct subsidiaries results and 50% of jointly-owned subsidiaries results, Raízen Energia and Raízen Combustíveis. The pro forma data are reported merely as illustration and shall not be interpreted as a representation of the accounting results. Cosan's business units and interest in each reportable segment are shown below: Raízen Combustíveis (50%) Raízen Energia (50%) Comgás (63.1%) Moove (100%) Cosan Corporate (100%) Fuel Distribution Sugar, Ethanol & Cogeneration Natural Gas Distribution Lubricants, Basic Oils and Specialties Corporate Structure and Other Investments Comparisons in this report take into consideration 3Q17 and 3Q16, except where indicated differently. Executive Summary 3Q17 Brazilian economic activity continues to show indicators of recovery, with higher industrial production and slightly lower unemployment rates. Inflation is evolving according to government expectations, enabling reduction of interest rates, which should continue to stimulate economy. Important sectors where the Company operates also registered signs of improvements in activity. Total registrations of light and heavy vehicles in the quarter grew 15% and 3%, respectively (versus 3Q16, ANFAVEA data), and there was an increase on fuel, lubricants, and natural gas consumption in the same period. Cosan S/A Proforma: Adjusted EBITDA reached R$1.6 billion (+28%) in the quarter, due to better operational performance across all businesses. Raízen Combustíveis volume sold grew once again above market. Raízen Energia second quarter of 2017/18 crop increased crushing and sales of own products, according to commercialization strategy for the year. Natural gas sales continue to increase in all segments of Comgás operations reflecting higher economic activity and new connections. Moove keeps focusing on sales volume growth in Brazil, adding new clients and contracts with car makers, as well as international markets. Net income totaled R$500 million in 3Q17 and Cosan s free cash flow to equity (FCFE) consumption was R$519 million, affected by cash outflow related to Raízen s acquisition of Tonon mills and seasonal working capital impact. Leverage (net debt/proforma EBITDA) stood at 2.1x at the end of the period. Raízen Combustíveis: Adjusted EBITDA grew 21% to R$894 million in 3Q17. Sales volume grew 4% when compared to same period last year (5% from 2Q17), while market went up only 1% (based on ANP data) in 3Q17. Otto cycle sales volume grew 2% (3% in gasoline equivalent) while diesel sold by Raízen was up 8% from 3Q16 (10% from 2Q17). Fuel prices dynamics throughout the quarter provided inventory gains, reverting the losses registered in the previous quarter. This effect coupled with an effective supply and commercialization strategy sustained a better performance in the period. Raízen Energia: Adjusted EBITDA (excluding biological asset variation, debt hedge accounting and forex effect on sugar exports) totaled R$1.4 billion (+50%), reflecting the higher crushing and own volume sold of all products in the quarter. Additionally, better sugar and energy prices in Brazilian Reais contributed to results growth. Crushing reached 28 million tons (+10%) due to drier weather in the period and sugarcane productivity (TRS/TCH) reached 10.3 Kg de TRS/hectare (-3%). Raízen s production mix reached 57% of sugar in 3Q17 (versus 59% in 3Q16), in view of increasing profitability of ethanol over sugar. Comgás: EBITDA, normalized by regulatory current account effect, was R$477 million (+6%) in 3Q17, impacted by higher volume sold and inflation-related tariff adjustment in May Natural gas sales volume grew in all segments in 3Q17. In the industrial segment, the 5% year-on-year increase is due to the gradual improvement of activity in major sectors using natural gas. The residential and commercial volumes also grew 5%, mainly boosted by increased customer base in the last 12 months. Moove: EBITDA in 3Q17 was up 23% to R$44 million, as a result of higher volume sold (+11% versus 3Q16) in all markets, especially in Brazil. The following tables present the key operating and financial metrics of our businesses. Historical data for the information presented can be found on our Investor Relations website (ir.cosan.com.br) in the Results Center. Statements with all financial and operational data are presented starting on page 16 of this report. 2 de 23

3 Operating and Financial Metrics Raízen Combustíveis 3Q17 3Q16 Chg.% 2Q17 Chg.% (Jul-Sep) (Jul-Sep) 3Q17/3Q16 (Apr-Jun) 3Q17/2Q17 Otto Cycle 6 Volume ('000 cbm) 2,958 2,903 2% 2,941 1% Gasoline Equivalent 7 Volume ('000 cbm) 2,760 2,688 3% 2,775-1% Diesel Volume ('000 cbm) 3,028 2,793 8% 2,756 10% Adjusted EBITDA Margin 8 (BRL/cbm) % 89 53% Adjusted EBIT 8 (BRL/cbm) % 63 75% Note 6: Sum of gasoline and ethanol volumes. Note 7: Sum of gasoline and ethanol volumes, adjusted by the energy coefficient of 0,7221. Note 8: Excludes non-recurring items, as detailed on page 5 herein. Raízen Energia Indicators 3Q17 3Q16 Chg.% (Jul-Sep) (Jul-Sep) 3Q17/3Q16 Sugarcane Crushed (mln mt) % TRS/ha % Sugar/Ethanol Production Mix 57% x 43% 59% x 41% n/a Adjusted EBITDA 9 (BRL mln) 1, % Adjusted EBIT 9 /TRS sold (BRL/ton) % Note 9: Excludes non-recurring effects, as detailed on page 5 herein. Comgás 3Q17 3Q16 Chg.% 2Q17 Chg.% (Jul-Sep) (Jul-Sep) 3Q17/3Q16 (Apr-Jun) 3Q17/2Q17 Total Sales Volume (mln cbm) Ex-Thermal 1,114 1,066 5% 1,080 3% Normalized EBITDA 10 (BRL mln) % 460 4% IFRS EBITDA (BRL mln) % % Note 10: Includes the effect from the regulatory Current Account. Moove 3Q17 3Q16 Chg.% 2Q17 Chg.% (Jul-Sep) (Jul-Sep) 3Q17/3Q16 (Apr- 3Q17/2Q17 Total Sales Volume ('000 cbm) % Jun) 93 1% EBITDA (BRL mln) % 53-16% 3 de 23

4 Cosan Consolidated Results The following table provides a breakdown of the 3Q17 results by business unit for all segments detailed previously. All information reflects 100% of their financial performance, regardless of the interest held by Cosan. For the purpose of reconciling EBITDA in the column Cosan S/A, the Adjustments & Eliminations column reflects the eliminations from operations among all Cosan subsidiaries for consolidation purposes. Earnings by Business Unit Comgás Moove Cosan Corporate Adjustments and Eliminations Cosan S/A Accounting Raízen Combustíveis Raízen Energia 50% Raízen Adjustments and Eliminations Consolidated Pro forma 3Q17 Net Revenue 1, , , ,839.9 (11,146.4) (297.3) 12,920.4 Cost of Goods and Services Sold (936.0) (384.2) (4.4) (0.0) (1,324.5) (17,325.0) (2,933.8) 10, (11,156.6) Gross Profit (2.4) , (1,017.0) - 1,763.8 Gross Margin (%) 39.0% 28.1% n/a n/a 36.1% 6.1% 23.6% n/a n/a 13.7% Selling Expenses (154.5) (96.6) (0.1) - (251.3) (353.9) (274.9) (565.7) General and Administrative Expenses (88.3) (23.4) (39.9) - (151.5) (113.8) (165.0) (290.9) Other Operating Income (Expenses) (11.6) (3.7) (13.0) - (28.4) (36.4) Equity Pick-up - (1.5) (126.0) (0.4) 0.2 (410.6) 1.0 Depreciation and Amortization (376.4) EBITDA (126.0) ,050.4 (975.8) (410.6) 1,434.5 EBITDA Margin (%) 30.2% 8.3% n/a n/a 42.0% 4.9% 27.4% n/a n/a 11.1% Financial result (57.3) (12.5) (10.7) (72.1) 75.5 (1.7) - (9.0) Income and Social Contribution Taxes (99.6) (5.0) (43.0) - (147.7) (213.7) (150.3) (329.7) Non-controlling Interest (69.3) (69.3) (16.8) (0.0) (77.7) Net Income (195.3) (410.6) (410.6) Earnings by Business Unit Comgás Moove Cosan Corporate Adjustments and Eliminations Cosan S/A Accounting Raízen Combustíveis Raízen Energia 50% Raízen Adjustments and Eliminations Consolidated Pro forma 9M17 Net Revenues 4, , (0.0) 5, , ,859.1 (31,637.0) (1,013.2) 36,159.7 Cost of Goods and Services Sold (2,522.9) (1,052.6) (6.0) 0.0 (3,581.5) (50,571.2) (8,261.8) 29, ,013.2 (31,984.8) Gross Profit 1, (3.7) - 1, , ,597.2 (2,220.5) - 4,174.9 Gross Margin (%) 37.6% 29.5% n/a n/a 35.3% 5.3% 16.2% n/a n/a 11.5% Selling Expenses (486.5) (283.9) (0.2) - (770.7) (996.0) (605.6) (1,571.4) General and Administrative Expenses (246.5) (64.8) (114.4) - (425.7) (332.5) (452.2) (818.0) Other Operating Income (Expenses) (21.5) (3.9) (62.3) - (87.8) (91.1) (79.5) - (8.3) Equity Pick-up - (5.6) (276.7) (48.2) 24.1 (707.1) (25.1) Depreciation and Amortization ,536.8 (1,009.8) - 1,460.5 EBITDA 1, (276.7) 1, , ,937.0 (2,092.6) (707.1) 3,212.5 EBITDA Margin (%) 28.3% 9.4% n/a n/a 33.0% 4.2% 19.6% n/a n/a 8.9% Financial results (139.9) (36.6) (226.2) - (402.7) (315.3) (504.2) Income and Social Contribution Taxes (226.1) (18.5) (197.2) (446.9) (56.6) (449.0) Non-controlling Interest (147.4) (147.4) (45.1) (0.0) (169.9) Net Income (424.1) (707.1) (707.1) de 23

5 Adjusted EBITDA and Net Income A description of the adjustments made by business line, based on the following criteria, is presented below: Raízen Combustíveis: (i) (ii) effects from asset divestments, and non-recurring effects: Raízen Energia: 2Q17: (a) Tax recovery and (b) eliminations between Raízen Combustíveis and Raízen Energia. 3Q16: (a) Tax recovery and (b) proceeds from STP divestment. (i) (ii) (iii) (iv) biological assets variation; debt hedge accounting effects; foreign exchange effect adjustment on sugar exports; non-recurring effects: 3Q17: Unrealized gain between Raízen Energia and Raízen Combustíveis. Comgás: (i) regulatory current account effect. Adjusted EBITDA 3Q17 3Q16 Chg.% 2Q17 Chg.% BRL mln (Jul-Sep) (Jul-Sep) 3Q17/3Q16 (Apr-Jun) 3Q17/2Q17 Pro forma EBITDA 1, , % % Raízen Combustíveis (50%) (3.7) (181.1) -98.0% (82.5) -95.5% Asset Divestments (3.7) (0.7) n/a (8.4) -56.3% Non-recurring effects - (180.4) n/a (74.1) n/a Raízen Energia (50%) n/a % Change in Biological Assets n/a % Hedge Accounting - Debt (0.7) - n/a 45.9 n/a Foreign exchange effect in sugar n/a % Non-recurring effects (13.4) - n/a 9.9 n/a Comgás Regulatory Current Account (100%) 13.7 (46.6) n/a % Adjusted Pro forma EBITDA 1, , % 1, % Adjusted Net Income 3Q17 3Q16 Chg.% 2Q17 Chg.% BRL mln (Jul-Sep) (Jul-Sep) 3Q17/3Q16 (Apr-Jun) 3Q17/2Q17 Net Income (Loss) % (76.0) n/a Raízen Combustíveis (50%) (2.4) (119.5) -98.0% (54.4) -95.5% Asset Divestment (2.4) (0.5) n/a (5.6) -56.3% Non-recurring effects - (119.1) n/a (48.9) n/a Raízen Energia (50%) n/a % Change in Biological Assets n/a % Non-recurring effects (8.9) - n/a 6.6 n/a Comgás Regulatory Current Account (63%) 5.7 (19.3) n/a % Adjusted Net Income n/a 24.5 n/a 5 de 23

6 B. Results by Business Unit B.1 Raízen Combustíveis The fuel distribution market went through relevant changes in 3Q17, such as adjustment in federal taxes (PIS/COFINS) levied on gross revenue over main products and higher frequency of price adjustments by Petrobrás, besides the meteorological events in the U.S. affecting global market s oil prices. Brazilian market performance reflected signs of improvement in the economy fundamentals, such as favorable industrial production data, light and heavy vehicles higher sales, and the lower interest rates. After 8 quarters of lower fuel consumption in the country (ANP basis), total volume was up 1% year-on-year in 3Q17, highlighting diesel sales which increased 2% in the period. The Otto-cycle sales (gasoline + ethanol) shrank 1% in 3Q17, but it remained stable when measured in gasoline-equivalent (ANP basis). Aviation fuel sales maintained the same volume sold quarter-on-quarter (ANP basis), as well as the number of departures in the period (ANAC basis), reverting the trend of successive drops. Raízen Combustíveis again outperformed the industry average, reflecting the consistency in its expansion strategy focused on long-term relationships with the service stations network. Otto-cycle sales grew 2% in 3Q17 year-on-year (+1% versus 2Q17). On a gasoline-equivalent basis, sales volume grew 3% (-1% versus 2Q17), reflecting higher sales volume of gasoline (+5%) compared to ethanol (-8%). Diesel sales grew 8% in 3Q17 (10% versus 2Q17) influenced by a booming in agribusiness industry and new B2B clients. The aviation segment s volume dropped 3%, impacted by a reduction in the number of departures from major clients, but increased 7% quarter-on-quarter, in line with market recovery (ANAC basis). Total volume sold by Raízen in 3Q17 was up 4% year-on-year (+5% versus 2Q17). Sales Volume 3Q17 3Q16 Chg.% 2Q17 Chg.% 000 cbm (Jul-Sep) (Jul-Sep) 3Q17/3Q16 (Apr-Jun) 3Q17/2Q17 Total Volume 11 6,594 6, % 6, % Ethanol % % Gasoline 2,244 2, % 2, % Diesel 3,028 2, % 2, % Aviation % % Other Products % % Note 11: Excludes sales to other distributors, in accordance with SINDICOM methodology. Raízen Combustíveis net revenue came to R$18.5 billion in 3Q17 (+7%) due to higher sales volume, especially gasoline and diesel. In 3Q17, net revenue was impacted by a R$46 million rebate (R$43 million in 3Q16), referring to discounts on fuel sales for achieving certain targets. Cost of goods sold in 3Q17 increased 6% to R$17.3 billion, due to higher sales volumes, higher unit cost of products, and higher logistics expenses deriving from Raízen s supply strategy. Selling, general and administrative expenses were up 13% to R$468 million in 3Q17, impacted by higher volume sold and higher concentration of selling expenses in the period. Other operating revenue (expenses), adjusted by nonrecurring gains from assets sales (R$7 million), came to R$63 million in 3Q17, in line with the same period last year when adjusted by non-recurring effects. Adjusted EBITDA climbed 21% to R$894 million in 3Q17, in view of (i) higher sales volume, (ii) inventory gains due to ethanol, gasoline and diesel price dynamics, and (iii) continued gains deriving from supply and commercialization strategy. Adjusted EBIT, which includes depreciation and amortization of investments in infrastructure, renovation and expansion of service stations network increased 22% to R$724 million. Compared to 2Q17, adjusted EBITDA and EBIT climbed 61% and 83%, respectively, due to the negative impacts explained in 2Q17 results. EBITDA 3Q17 3Q16 Chg.% 2Q17 Chg.% BRL mln (Jul-Sep) (Jul-Sep) 3Q17/3Q16 (Apr-Jun) 3Q17/2Q17 EBITDA , % % Asset Divestments (7.4) (1.5) n/a (16.8) -56.3% Other extraordinary effects - (360.8) % (148.2) % Adjusted EBITDA % % EBIT % % Adjusted EBIT % % Raízen Combustíveis CAPEX went down 3% to R$185 million in 3Q17, impacted by lower concentration of investments in expansion and renovation of services stations network, but in line with annual plan. Raízen ended with 6,138 Shell branded services stations. 6 de 23

7 B.2 Raízen Energia Sugarcane harvest in Brazil s Center-South region advanced during 3Q17, stimulated by a drier climate in the period. Crushing in the region reached 268 million tons in the second quarter of 2017/18 crop year, 3% higher than same period last crop year (UNICA figures), offsetting the delayed start of harvest. Production mix came in line at 49% of sugar produced due to higher volume of export contracts driven by higher commodity prices (NY#11). In 9M17, the Center-South region crushed 467 million tons and produced 29 million tons of sugar, volumes 2% lower and 5% higher, respectively, than same period of 2016/17 crop. Raízen Energia crushing was up 10% to 28.3 million tons in 3Q17, in line with the market, stimulated by drier weather in the period. Sugarcane productivity, measured by the combination of TRS index (Total Recoverable Sugar per ton of crushed cane, in kilos) and TCH (Tons of Cane Harvested per Hectare), reached 10.3 Kg of TRS/hectare (-3%), versus 10.6 in 3Q16, also effect of lower concentration of rainfall in the period. Raízen s production mix reflects a continued profitability analysis per product, and this quarter reached 57% of sugar (versus 59% in 3Q16). Adjusted net revenue (Note 12 of table below) was up 26% to R$4.1 billion in 3Q17, reflecting higher sales volume and better average prices of sugar and electricity. Accelerated production in 3Q17 resulted in higher availability of our own product, which coupled with the commercial strategy in the period, enabled higher sales, highlighting sugar in the foreign market and ethanol in the domestic market. Below, the effects on volume and net revenue from main products in the quarter: Sugar: Adjusted net revenue was up 22% to R$1.9 billion in 3Q17 due to higher volumes sold (+17%), mainly in the foreign market (+21%), and better average prices adjusted in Reais (R$1,414/ton, +5% versus 3Q16). This quarter concentrated sales of own products (+21%). Ethanol: Net revenue totaled R$1.7 billion (+23%) due to higher volumes sold (+27%) in the domestic market (+75%). Average price in the period was R$1,604/m³ (-3%), in line with market prices (ESALQ base). Like sugar, own ethanol sales volume increased 44%, as a result of crop higher production and commercialization strategy. Cogeneration: Net revenue from energy sold climbed 77% to R$365 million due to higher volumes sold (+28%), in view of higher availability of bagasse, and better average prices - R$ 261/MWh (+38%). Sales Breakdown 3Q17 3Q16 Chg.% BRL mln (Jul-Sep) (Jul-Sep) 3Q17/3Q16 Adjusted Net Revenue 4, , % Sugar Sales 1, , % Domestic Market % Export Market 12 1, , % Ethanol Sales 1, , % Domestic Market 1, % Export Market % Energy Cogeneration % Other Products and Services % Hedge Accounting - Debt n/a Foreign Exchange Effect in Sugar (296.1) (139.8) n/a Net Revenue 3, , % Note12: Net revenue from sugar exports includes the effects from hedge accounting debt and from FX effect in sugar. Sugar ( 000 tons) Sales Volume 3Q17 vs. 3Q16 Ethanol ( 000 cbm) Sugar Inventories Ethanol Inventories 09/30/ /30/2016 Chg.% 06/30/2017 Chg.% 09/30/ /30/2016 Chg.% 06/30/2017 Chg.% '000 ton 1,374 1, % 514 n/a '000 m³ % 432 n/a BRL mln 1,155 1, % 487 n/a BRL mln 1,177 1, % % BRL/ton % % BRL/cbm 1,315 1, % 1, % 7 de 23

8 Cost of goods sold totaled R$2.9 billion in 3Q17, up 18% year-on-year, due to higher sales volume of all products in the period. Unit cash cost of own product (in sugar-equivalent) decreased 8% to R$582/ton, impacted by lower average CONSECANA price index in the quarter (-8%), which directly affects land lease agreements and the acquisition of third-party sugarcane. This effect is explained by higher dilution of fixed costs due to higher sales volume and a continued focus on effective agricultural and industrial operation. Excluding the effect from CONSECANA price, unit cash cost would be R$616/ton (-3%). Cost of Goods Sold 3Q17 3Q16 Chg.% BRL mln (Jul-Sep) (Jul-Sep) 3Q17/3Q16 Cost of goods sold (2,933.8) (2,480.3) 18.3% Average Unit (Cash) Costs 13 - sugar equivalent (R$/ton) (582) (634) -8.2% Average Unit (Cash) Costs 13 - Excluding CONSECANA (R$/ton) (616) (634) -2.9% Note 13: Cash cost of own sales volumes excludes depreciation and amortization of planting and tilling, agricultural, industrial and off-season maintenance. Selling, general and administrative expenses went up 35% to R$440 million in 3Q17. This increase is due to higher sales expenses, as a result of higher sales volume and concentration of general and administrative expenses in the quarter. It is worth mentioning that due to the integration of Tonon Group s mills (Santa Cândida and Paraíso) into portfolio in September/2017, nonrecurring expenses were recorded in 3Q17. Adjusted EBITDA in 3Q17 totaled R$1.4 billion (+50%), boosted by: (i) better sales mix with higher sugar (+44%) and ethanol (+74%) own sales volumes in the quarter, (ii) higher sugar average sales price in Reais, (iii) higher electricity sales volume with better prices, and (iv) lower unit cost. As of 2Q17, we have been including a line of adjustment to EBITDA referred to as Foreign exchange impacts on Sugar aiming at including the impact of foreign exchange effectively applied to protect sugar exports in the operating results. It is worth mentioning that sugar pricing at Raízen is denominated in Brazilian Reais, i.e., commodity and currency hedge. The Brazilian Real appreciation against the U.S. dollar negatively affected EBITDA in the period, since revenue recognized in sugar exports reflects the exchange rate of the shipment date. Thus, we had a positive effect of R$296 million recognized in financial result year to date (including previous quarters) relating to currency hedge instruments contracted to determine revenues in Reais, highlighted in the EBITDA table below. The average of currency hedges for shipments was R$3.86/USD, compared to the actual average exchange rate (average PTAX) of R$3.14/USD. As shown in the table below, reported EBITDA in 3Q17 was impacted by: (i) the negative effect of R$75 million from biological assets negative variation due to lower CONSECANA reference price, (ii) the positive effect of R$1 million referring to the debt hedge accounting, (iii) the negative effect of R$296 million referring to foreign exchange designated to hedge sugar exports, and (iv) the positive effect of R$27 million of unrealized operating result between Raízen Energia and Raízen Combustíveis. EBITDA and EBIT 3Q17 3Q16 Chg.% BRL mln (Jul-Sep) (Jul-Sep) 3Q17/3Q16 EBITDA 1, % Change in biological assets n/a Hedge Accounting - Debt (1.3) - n/a Foreign Exchange Effect in Sugar n/a Non-Recurring Effects from unrealized profits (26.9) - n/a Adjusted EBITDA 1, % Adjusted EBITDA Margin (%) 36.3% 29.6% 0.2 p.p. EBIT % Adjusted EBIT % The position of volumes and sugar prices defined with trading companies or via derivative financial instruments in US dollars and converted into Reais, until September 30, 2017, respectively, are summarized as follows: Summary of Hedge Operations at 09/30/ Sugar 2017/ /2019 Volume ('000 ton) 2, Average Price 15 (BRL centavos/lb) Average Price ( /lb) Note 14: Hedge coverage is based on the crop years ending in 3/31/2017 and 3/31/2018. Note 15: The average price in /lb considers exchange rate hedged through financial instruments. Net revenue is recorded at exchange rate realized in the period. Raízen Energia s investments came to R$423 million (+12%), excluding the disbursement for the acquisition of Tonon s Group mills, chiefly due to higher biological assets CAPEX (+9%), effect of increased harvest and accordingly, higher tilling expenses, and acceleration of mandatory investments in health, safety and environment (HSE) and Sustainability projects, as per crop year guidance. 8 de 23

9 CAPEX 3Q17 3Q16 Chg.% BRL mln (Jul-Sep) (Jul-Sep) 3Q17/3Q16 Total CAPEX % Maintenance CAPEX % Biological Assets % Off-season Maintenance % Operating CAPEX n/a HSE & Sustaining n/a Mechanization n/a Industrial n/a Projects CAPEX % Cogeneration and Expansion % Other Projects % 9 de 23

10 B.3 Comgás Comgás ended the third quarter of 2017 with higher natural gas sales volume, recording growth across all segments. In the industrial segment, the 5% growth compared to 3Q16 is explained by a gradual improvement of activity in major sectors using natural gas and higher consumption from some clients. The commercial and residential volumes also grew 5%, stimulated by increased customer base (+101,000 and +810 new clients, respectively, in the last 12 months). Sales Volumes 3Q17 3Q16 Chg.% 2Q17 Chg.% Mln cbm (Jul-Sep) (Jul-Sep) 3Q17/3Q16 (Apr-Jun) 3Q17/2Q17 Natural Gas Sales, ex-thermal power 1,114 1, % 1, % Residential % % Commercial % % Industrial % % Cogeneration % % Automotive % % Comgás posted net revenue of R$1.5 billion (+11%) in 3Q17, reflecting higher tariffs defined by ARSESP s ordinances, as well as higher volume distributed in the period. Total cost of products sold were up 23% to R$936 million due to higher unit cost of natural gas added to higher sales volume. Selling, general and administrative expenses came to R$243 million (+5%) in the quarter, in line with 3Q16. EBITDA, normalized by regulatory current account, was R$477 million (+6%) in the period, reflecting higher sales volume and margin adjustment by inflation (2.6%) in May IFRS EBITDA was R$463 million (-6%) in 3Q17 due to return of regulatory current account (R$8.9 million in the period), which ended the quarter with a balance of R$259 million in favor of clients. EBITDA 3Q17 3Q16 Chg.% 2Q17 Chg.% BRL mln (Jul-Sep) (Jul-Sep) 3Q17/3Q16 (Apr-Jun) 3Q17/2Q17 Normalized EBITDA % % Normalized EBITDA Margin (%) 31.1% 32.5% -1.4 p.p. 33.8% -2.8 p.p. IFRS EBITDA % % IFRS EBITDA Margin (%) 30.2% 35.9% -5.7 p.p. 26.9% 3.2 p.p Comgás invested R$126 million (+23%) in 3Q17, a seasonal increase and in line with year s guidance. The complete earnings release of Comgás is available at the website: ir.comgás.com.br. Page 23 of this report presents a reconciliation of Comgás' Net Income based on Cosan s accounting perspective. 10 de 23

11 B.4 Moove (Lubricants) The Brazilian lubricant market slightly recovered total sales volume (+0.5% in 3Q17, +1% in 2Q17) for the second consecutive quarter, as a reflection of the improvements observed in some indicators such as production, sales of vehicles, and economic activity. At Moove, sales in Brazil again outperformed the market average and reached 11% growth in volume sold, reflecting the business strategy focused on increasing automotive and industrial customer base, including strengthening share in Brazil s carmaker market. In addition, Moove also recorded good sales performance in other international performance markets (+8% versus 3Q16). Total sales volume reached 93,000 m³ in 3Q17, up 11% year-on-year. Lubricants net revenue grew 15% to R$534 million in 3Q17 due to higher sales volume and better sales mix. These same impacts boosted EBITDA 23% increase to R$44 million in 3Q17. EBITDA 3Q17 3Q16 Chg.% 2Q17 Chg.% BRL mln (Jul-Sep) (Jul-Sep) 3Q17/3Q16 (Apr-Jun) 3Q17/2Q17 EBITDA % % EBITDA Margin (%) 8.3% 7.8% 0.5 p.p 10.4% -2.0 p.p. B.5 Cosan Corporate The Cosan Corporate segment comprises Cosan s corporate structure, i.e. expenses with sundry consulting services and personnel (payroll, charges and severance), as well as the effects arising from the contingencies of the businesses contributed to Raízen prior to its incorporation, and other investments. Total Expenses and EBITDA 3Q17 3Q16 Chg.% 2Q17 Chg.% BRL mln (Jul-Sep) (Jul-Sep) 3Q17/3Q16 (Apr-Jun) 3Q17/2Q17 General and Administrative Expenses (40.0) (38.7) 3.3% (35.0) 14.5% Other Operating Income (Expenses) (13.0) (22.6) -42.2% (35.9) -63.6% EBITDA ex- Equity Pick-up (51.6) (59.0) -12.5% (67.1) -23.1% (+) Equity Pick-up % n/a EBITDA % 70.1 n/a General and administrative expenses totaled R$40 million (+3%) in 3Q17, in line with expectations. Other operating expenses, composed of legal and consulting expenses, came to R$13 million (-42%) in 3Q17 due to lower concentration of expenses in the period. 11 de 23

12 C. Other Lines of the Consolidated P&L (ex-raízen) Financial Result Financial Result 3Q17 3Q16 Chg.% 2Q17 Chg.% BRL mln (Jul-Sep) (Jul-Sep) 3Q17/3Q16 (Apr-Jun) 3Q17/2Q17 Cost of Gross Debt (104.4) (320.6) -67.4% (293.4) -64.4% Perpetual Notes 45.7 (30.5) n/a (91.5) n/a Interest of Bank Debts (150.0) (290.1) -48.3% (202.0) -25.7% Interest Income % % (=) Subtotal: Interest on Net Debt (33.7) (249.3) -86.5% (192.3) -82.5% Other Charges and Monetary Variation 32.1 (46.1) n/a (56.5) n/a Banking Expenses, Fees and Other (9.2) (10.6) -13.7% (8.2) 12.1% Net Financial Result (10.7) (306.0) -96.5% (256.9) -95.8% Net financial expenses came to R$11 million in 3Q17, down 96% year-on-year. The mark-to-market of perpetual bonds resulted in a positive effect of R$46 million in 3Q17 due to Real appreciation against the US dollar, since only interest rates of next 2 years of this debt are hedged by derivatives. Bank debt interest expenses (including interest expenses, foreign exchange variation and derivatives results) went down 48% to R$150 million, mainly impacted by the CDI rate drop and lower bank debt balance. The weighted average cost of Cosan S/A s debts (ex-raízen) corresponds to 109% of CDI. Interest income came to R$71 million, in line with 3Q16, due to higher balance of cash and cash equivalents offset by interest rate drop. Other charges and monetary variations were positively impacted by appreciation of Rumo s shares held by Cosan S.A. (markto-market of equity instruments), contributing to generate non-cash revenue of R$32 million in the quarter. Income and Social Contribution Taxes The following table provides a breakdown of income and social contribution tax expenses of 3Q17 by business unit: Income and Social Contribution Taxes BRL mln Comgás Moove Cosan Corporate Adjustments & Eliminations Consolidated Operating Profit before Taxes (126.0) Income and Social Contribution Taxes, Nominal Rate (%) 34.0% 34.0% 34.0% 34.0% 34.0% Theoretical Expense with Income and Social Contribution (97.7) (4.2) (184.5) 42.8 (243.7) Non-taxable Permanent Differences/Equity Pick-up (5.3) (42.8) 95.2 Other 3.4 (1.9) (0.7) Effective Expense with Income and Social Contribution Taxes (99.6) (5.0) (43.0) - (147.7) Income and Social Contribution Taxes, Effective Rate (%) 34.7% 40.2% 7.9% % Expenses with Income and Social Contribution Taxes Current (73.3) (5.7) (1.2) - (80.2) Deferred (26.3) 0.7 (41.8) - (67.5) Net Income Cosan posted net income of R$500 million (+53%) in 3Q17, reflecting Raízen Energia s improved results and lower net financial expense in the period. In addition, it is worth mentioning that net results in 3Q17 were negatively impacted by nonrecurring effects on businesses, as mentioned in the EBITDA and Adjusted Net Income section of this report. The net income adjusted by these non-recurring effects would be R$519 million versus R$188 million in 3Q de 23

13 D. Loans and Financing At the close of 3Q17, Cosan s proforma consolidated gross debt (excluding PESA at Raízen Energia) stood at R$13.7 billion (-3%), reflecting the amortization of R$133 million of debts issued by BNDES and EIB (European Investment Bank) at Comgás and R$195 million of PPE (Export Pre-Payment) at Raízen Energia. Cosan S/A's proforma leverage ratio (including obligations with preferred shareholders) ended the quarter at 2.1x Net Debt /EBITDA (based on proforma LTM EBITDA). If we consider Comgás normalized results, adjusted by regulatory current account, leverage would remain at 2.1x. Proforma bank net debt, excluding obligations with preferred shareholders, totaled R$8.2 billion in 3Q17, a R$146 million increase from 2Q17. Loans and Financing 3Q17 BRL mln Comgás Moove Cosan Corporate Consolidated Raízen Energia Raízen Combustíveis Consolidated Pro forma Opening balance of pro forma net debt 1, , , , ,088.6 Cash, cash equivalents and marketable securities 2, , , , ,026.1 Gross Debt 3, , , , ,114.7 Cash items (167.1) 81.6 (203.5) (289.0) (239.1) (7.0) (535.1) Funding (0.3) Payment of principal on loans and borrowings (133.2) (0.0) (38.5) (171.7) (195.4) (2.0) (369.1) Payment of Interest on loans borrowings (58.4) (0.0) (125.3) (183.7) (45.3) (4.7) (233.7) Derivatives (14.7) - (86.0) (100.7) - - (100.7) Noncash items (3.2) Provision for interest (accrual) Monetary variation and MTM adjustment of debt 73.6 (0.6) Exchange variation, net of derivatives (47.6) 3.4 (229.7) (273.9) (95.3) 20.8 (348.4) Closing balance of gross debt 3, , , , ,703.5 Cash, cash equivalents and marketable securities 2, , , , ,469.4 Closing balance of pro forma net debt 1, , , , ,234.1 Obligations due to preferred shareholders of subsidiaries - - 1, , ,555.5 Total pro forma net debt and obligations due to preferred shareholders of subsidiaries 1, , , , ,789.6 E. Reconciliation of the Change in Net Debt Cash Flow Statement 3Q17 Comgás Moove Cosan Eliminations Cosan S/A Raízen Cosan S/A Eliminations BRL mln Corporate Combined Pro forma Balance of Net Debt at start of period (1,370.6) (251.6) (2,918.0) - (4,540.2) (3,548.4) - (8,088.6) Balance of Net Debt at end of period (1,009.9) (297.0) (2,602.6) - (3,909.6) (4,324.5) - (8,234.1) Change in Net Debt (45.4) (776.1) - (145.5) Non-cash items Interest Accrual Monetary variation and MTM adjustment of debt 73.6 (0.6) Exchange Variation, net of derivatives (47.6) 3.4 (229.7) - (273.9) (74.5) - (348.4) Cash change in Net Debt (38.6) (753.7) - (21.6) Reconciliation of Cash Generation EBITDA (126.0) (410.6) 1,434.5 Noncash impacts on EBITDA (522.8) (354.0) Changes in assets and liabilities (23.6) (47.2) (40.3) (643.8) - (684.2) Operating financial result (75.4) - (4.6) Operating cash flow Capex (73.1) (15.6) (3.7) - (92.4) (293.4) - (385.8) Other (378.3) - (378.3) Cash flow after investments (73.1) (15.6) (3.7) - (92.4) (671.7) - (764.1) Other Effects Ex Debt 0.0 (34.4) (2.6) - (37.0) (36.8) Dividends Received (325.6) 0.0 Cosan S/A Raízen (343.4) - (343.4) Dividends Payed (343.4) (17.8) Exchange variation impact on cash and cash equivalents (12.2) - (9.9) (10.4) - (20.3) Change in Net Debt (38.6) (753.7) - (21.6) 13 de 23

14 F. Cash Flow Reconciliation Below, the information necessary to reconcile the free cash flow to equity (FCFE) on an accounting basis ("Cosan S/A") and on a pro forma basis ("Pro forma Consolidated"), considering 50% of Raízen's results, highlighting the cash disbursement of R$378 million related to th 50% investment for the acquisition of Tonon s mills (Other in Cash Flow from Investing Activities). Cash Flow Statement 3Q17 3Q16 Cosan Cosan S/A Raízen Cosan S/A Cosan S/A BRL mln Comgás Moove Eliminations Eliminations Corporate Accounting Combined Pro forma Pro forma EBITDA (126.0) (410.6) 1, , % Noncash impacts on EBITDA (522.8) (354.0) (112.3) n/a Changes in assets and liabilities (23.6) (47.2) (40.3) (643.8) - (684.2) (331.0) n/a Operating financial result (75.4) - (4.6) n/a Operating Cash Flow , % CAPEX (73.1) (15.6) (3.7) - (92.4) (293.4) - (385.8) (379.3) 1.7% Other (378.3) - (378.3) n/a Cash Flow from Investing Activities (73.1) (15.6) (3.7) - (92.4) (671.7) - (764.1) (225.8) n/a Funding % Payment of principal on loans and borrowings (133.2) (0.0) (38.5) - (171.7) (197.4) - (369.1) (347.6) 6.2% Payment of Interest on loans borrowings (58.4) (0.0) (125.3) - (183.7) (51.8) - (235.5) (173.6) 35.7% Derivatives (14.7) - (86.0) - (100.7) - - (100.7) (227.9) -55.8% Other 0.0 (34.4) (2.6) - (37.0) (35.0) 18.2 n/a Cash Flow from Financing Activities (167.1) 47.2 (206.1) - (326.0) (245.9) - (571.9) (130.2) n/a Dividends received (325.6) % Free Cash Flow to Equity (646.0) (325.6) (518.6) n/a Cosan S/A % Comgás n/a Raízen (343.4) - (343.4) (272.5) 26.0% Dividends paid (343.4) (17.8) (57.4) -69.0% Exchange variation impact on cash and cash equivalents Chg.% (12.2) - (9.9) (10.4) - (20.3) (6.1) n/a Cash Generation (Burn) in the Period (999.8) - (556.7) n/a Cash Flow Statement BRL mln Raízen Energia Raízen Combustíveis Operating Cash Flow Cash Flow from Investing Activities (595.0) (76.7) Cash Flow from Financing Activities (195.9) (49.9) Free Cash Flow to Equity (713.2) de 23

15 G. Guidance This section presents the 2017 guidance for each of the key parameters of Cosan s consolidated results, besides the guidance for Raízen Energia 2017/18 crop year. In 3Q17, we are updating some estimates on 2017 results of Comgás, Moove, and Raízen Energia, accordingly, Cosan Consolidated Proforma, according to the chart below. Other sections of this earnings release may also contain projections. These projections and guidance are merely estimates and indicative and do not represent any guarantee of future results. Cosan s consolidated EBITDA is presented on a pro forma basis, which includes 50% of the results of Raízen Combustíveis and of Raízen Energia. Note that Raízen s results are no longer consolidated proportionately into Cosan, with only its net income recognized under Equity Pick-Up. Actual Guidance Guidance Review Cosan S/A Consolidated Raízen Combustíveis Comgás (Jan-Dec) (Jan-Dec) (Jan-Dec) Pro forma Net Revenue (BRL mln) 47,008 45,000 48,000 45,000 48,000 Pro forma EBITDA 16 (BRL mln) 4,665 4,750 5,250 4,900 5,300 Adjusted EBITDA 16 (BRL mln) 2,812 2,700 3,000 2,700 3,000 CAPEX (BRL mln) , ,000 Total Volume Sold, ex Thermo ('000 cbm) 4,119 4,000 4,300 4,250 4,350 Normalized EBITDA (BRL mln) 1,465 1,550 1,650 1,670 1,730 CAPEX (BRL mln) Moove EBITDA (BRL mln) Raízen Energia Actual Guidance Guidance Review Crop year 2016/17 Crop Year 2017/18 Crop Year 2017/18 (Apr/16-Mar/17) (Apr/17-Mar/18) (Apr/17-Mar/18) Volume of Sugarcane Crushed ('000 tons) 59,391 59,000 63,000 59,000 63,000 Volume of Sugar Produced ('000 tons) 4,227 4,300 4,700 4,300 4,700 Volume of Ethanol Produced (million liters) 1,990 2,000 2,300 2,000 2,300 Volume of Energy Sold ('000 of MWh) 2,802 2,000 2,200 2,200 2,400 Adjusted EBITDA 16 (BRL mln) 3,078 3,900 4,300 3,900 4,300 CAPEX (BRL mln) 2,088 2,100 2,400 2,300 2,600 Note 16: Cosan S/A Consolidated Pro forma EBITDA considers in both results and guidance the adjustments that are highlighted in the Company s earnings releases each quarter, that is, reflecting the recurring results of operations, excluding any one-off effects. Raízen s Energia Adjusted EBITDA also includes the forex effect on sugar exports. Disclaimer This document contains forward-looking statements and estimates. These forward-looking statements and estimates are solely forecasts and do not represent any guarantee of prospective results. All stakeholders are cautioned that these forward-looking statements and information are and will be, depending on the case, subject to risks, uncertainties and factors related to the operations and business environment of Cosan and its subsidiaries, therefore the actual results of these companies may differ significantly from the future results expressed or implied by said forward-looking statements and information. Certain analyses presented herein refer to previous periods and may have been reclassified for comparison purposes. 15 de 23

16 I. Financial Statements I.1 Cosan S/A Consolidated Accounting Indicators 3Q17 3Q16 Chg.% 2Q17 Chg.% 9M17 9M16 Chg.% EBITDA % n/a 1, , % CAPEX % % % Income Statement for the Period 3Q17 3Q16 Chg.% 2Q17 Chg.% 9M17 9M16 Chg.% Net Revenue 2, , % 1, % 5, , % Cost of Goods and Services Sold (1,324.5) (1,104.7) 19.9% (1,221.8) 8.4% (3,581.4) (3,413.1) 4.9% Gross profit % % 1, , % Selling, general & administrative expenses (402.8) (403.8) -0.2% (401.4) 0.4% (1,196.3) (1,174.4) 1.9% Other net operating income (expenses) (28.4) (21.7) 31.2% (45.5) -37.5% (87.8) (80.2) 9.5% Financial results (10.7) (306.0) -96.5% (256.9) -95.8% (402.7) (1,018.3) -60.4% Equity Pick-up % 37.4 n/a , % Expenses with income and social contribution taxes (147.7) (24.2) n/a (12.2) n/a (197.2) (73.2) n/a Non-controlling interest (69.3) (85.3) -18.8% (46.9) 47.8% (147.4) (304.9) -51.7% Net income (loss) % (76.0) n/a % Balance Sheet 3Q17 2Q17 BRL mln 09/30/17 06/30/17 Cash and cash equivalents 3,720 3,415 Marketable Securities Trade accounts receivable Inventories Derivative financial instruments 1, Other current assets Other non-current assets 1,966 1,962 Investments 8,940 8,872 Property, plant and equipment Intangible assets 9,189 9,201 Total Assets 27,657 26,973 Loans and borrowings 8,920 9,059 Financial instruments and derivatives Trade accounts payable 1,700 1,584 Payroll Other current liabilities Other non-current liabilities 4,712 4,688 Shareholders' Equity 11,315 10,829 Total Liabilities 27,657 26, de 23

17 I.2 Raízen Combustiveis Sales Volumes 3Q17 3Q16 Chg.% 2Q17 Chg.% 9M17 9M16 Chg.% 000 cbm (Jul-Sep) (Jul-Sep) 3Q17/3Q16 (Apr-Jun) 3Q17/2Q17 (Jan-Sep) (Jan-Sep) 9M17/9M16 Total Volume 6,594 6, % 6, % 18,982 18, % Ethanol % % 1,838 2, % Gasoline 2,244 2, % 2, % 6,962 6, % Diesel 3,028 2, % 2, % 8,410 8, % Aviation % % 1,539 1, % Other % % % Otto cycle 2,958 2, % 2, % 8,800 8, % Gasoline Equivalent 2,760 2, % 2, % 8,289 7, % Indicators 3Q17 3Q16 Chg.% 2Q17 Chg.% 9M17 9M16 Chg.% EBITDA , % % 2, , % Adjusted EBITDA % % 2, , % Adjusted EBITDA Margin (BRL/cbm) % % % EBIT % % 1, , % Adjusted EBIT % % 1, , % Rebate % % % CAPEX % % % Income Statement for the Period 3Q17 3Q16 Chg.% 2Q17 Chg.% 9M17 9M16 Chg.% Net Operating Revenue 18, , % 17, % 53, , % Ethanol 1, , % 1, % 3, , % Gasoline 7, , % 7, % 23, , % Diesel 8, , % 7, % 23, , % Aviation % % 2, , % Other % % % Cost of Goods and Services Sold (17,325.0) (16,367.7) 5.8% (16,499.3) 5.0% (50,571.2) (47,633.4) 6.2% Gross profit 1, % % 2, , % Total Expences (467.7) (412.1) 13.5% (430.4) 8.7% (1,328.4) (1,289.5) 3.0% Selling expenses (353.9) (308.6) 14.7% (328.0) 7.9% (996.0) (965.2) 3.2% General and administrative expenses (113.8) (103.4) 10.0% (102.4) 11.1% (332.5) (324.2) 2.5% Other operating income (expenses) % % % Financial results (72.1) (146.5) -50.8% (71.2) 1.3% (315.3) (426.2) -26.0% Equity Pick-up - (2.8) % - n/a - (0.3) % Expenses with income and social contribution taxes taxes (213.7) (258.8) -17.4% (143.8) 48.7% (446.9) (443.0) 0.9% Non-controlling interest (16.8) (12.7) 32.3% (14.6) 15.3% (45.1) (35.0) 29.0% Net Income % % % Balance Sheet 3Q17 2Q17 BRL mln 09/30/17 06/30/17 Cash and cash equivalents Trade accounts receivable 1,849 1,510 Inventories 1,985 2,006 Derivative financial instruments Other current assets 1,620 1,394 Other non-current assets 1,641 1,423 Property, plant and equipment 2,337 2,345 Intangible assets 4,620 4,608 Total Assets 14,274 13,722 Loans and borrowings 1,013 1,058 Financial instruments and derivatives Trade accounts payable 1,486 1,162 Payroll Other current liabilities 1,890 1,959 Other non-current liabilities 4,229 4,076 Shareholders' Equity 5,309 5,120 Total Liabilities 14,274 13, de 23

18 I.3 Raízen Energia Indicators 3Q17 3Q16 Chg.% 2017/ /17 Chg.% (Jul-Sep) (Jul-Sep) 3Q17/3Q16 (Apr-Sep) (Apr-Sep) 17/18/16/17 Sugarcane Crushed 28,287 25, % 47,441 48, % Sugarcane Crushed, Own ('000 t) 12,250 11, % 22,341 22, % Sugarcane Crushed, Suppliers ('000 t) 16,037 14, % 25,099 25, % Sugarcane TRS (kg/t) % % TCH (tons of cane per hectare) % % TRS/ha (tons of TRS per hectare) % % Mechanization (%) 98,1% 97,7% 0.4 p.p. 98.2% 98.0% 0.2 p.p. Sugar ('000 ton) 2,212 1, % 3,455 3, % Ethanol ('000 cbm) 1, % 1,613 1, % Sugar ('000 ton) 1,371 1, % 2,413 2, % Ethanol ('000 cbm) 1, % 2,040 1, % Energy cogeneration ('000 MWh) 1,397 1, % 2,298 1, % EBITDA 1, % 1, , % Adjusted EBITDA 1, % 2, , % Adjusted EBITDA Margin (BRL/cbm) 36.3% 29.6% 6.7 p.p. 31.6% 30.5% 1.2 p.p. EBIT % % Adjusted EBIT % 1, % CAPEX % % Income Statement for the Period 3Q17 3Q16 Chg.% 2017/ /17 Var.% BRL mln (Jul-Sep) (Jul-Sep) 3Q17/3Q16 (Apr-Sep) (Apr-Sep) 17/18/16/17 Net Operating Revenue 3, , % 6, , % Sugar 1, , % 2, , % Ethanol 1, , % 3, , % Energy Cogeneration % % Other Products and Services % % Cost of goods sold (2,933.8) (2,480.3) 18.3% (6,029.7) (4,697.0) 28.4% Own Sugar (1,048.6) (940.9) 11.5% (1,979.7) (1,775.7) 11.5% Own Ethanol* (827.1) (608.9) 35.8% (1,451.9) (1,354.1) 7.2% Resale & Trading* (726.7) (752.8) -3.5% (1,714.7) (1,117.1) 53.5% Energy Cogeneration (176.4) (73.1) n/a (288.4) (140.1) n/a Other (154.9) (104.7) 47.9% (595.0) (310.0) 91.9% Gross profit % , % Total Expences (439.9) (326.8) 34.6% (754.8) (622.5) 21.3% Selling expenses (274.9) (199.5) 37.8% (461.3) (379.8) 21.5% General and administrative expenses (165.0) (127.3) 29.6% (293.5) (242.7) 20.9% Other operating income (expenses) 1.9 (20.4) n/a (5.8) (51.9) -88.8% Financial results % (22.6) n/a Equity Pick-up (0.4) (10.3) -96.2% (10.9) (22.8) -52.3% Expenses with income and social contribution taxes (150.3) (105.8) 42.0% 21.0 (185.1) n/a Non-controlling interest - (0,1) n/a - (0,1) n/a Net income % % Balance Sheet 3Q17 2Q17 BRL mln 09/30/17 06/30/17 Cash and cash equivalents 2,238 4,047 Marketable Securities Inventories 2,593 1,305 Derivative financial instruments Biological Assets Other current assets 2,776 2,489 Other non-current assets 3,743 3,809 Investments Property, plant and equipment 10,902 11,012 Intangible assets 3,682 3,219 Total Assets 28,069 28,117 Loans and borrowings 10,873 11,328 Financial instruments and derivatives Trade accounts payable 1,565 1,170 Payroll Other current liabilities 1,323 1,220 Other non-current liabilities 1,369 1,305 Shareholders' Equity 12,365 12,425 Total Liabilities 28,069 28,117 (*) There was a reclassification between own and resale & trading ethanol costs in 2Q1, with no impact to ethanol total costs of poducts sold in the period. 18 de 23