Em 31 de dezembro de 2008 e 2007 (em milhares de reais) MANAGERIAL REPORT. Rio de Janeiro, April 12th, 2010.

Transcription

1 QUEIROZ GALVÃO S.A.

2 2 B A L A N Ç O S PAT R I M O N I A I S C O N S O L I D A D O S Em 31 de dezembro de 2008 e 2007 (em milhares de reais) MANAGERIAL REPORT To the Stockholders, In accordance with the by-laws, we are submitting for your consideration the annual report of the management, and the related financial statements for the year ended December 31, 2009, of Queiroz Galvão S.A. The Management is grateful to all those who contributed toward the results achieved, especially our team of collaborators for their hard work and dedication, to suppliers and service providers for their good quality and punctuality and to clients for their faith in our work. Rio de Janeiro, April 12th, ADVISORY COUNCIL Antônio de Queiroz Galvão President João Antônio de Queiroz Galvão Vice President BOARD OF DIRECTORS Antônio Augusto de Queiroz Galvão President Ricardo de Queiroz Galvão Vice President Carlos de Queiroz Galvão Fernando de Queiroz Galvão Marcos de Queiroz Galvão Maurício José de Queiroz Galvão Roberto de Queiroz Galvão Counselor EXECUTIVE BOARD Antônio Augusto de Queiroz Galvão Fernando de Queiroz Galvão Marcos de Queiroz Galvão Mauricio José de Queiroz Galvão Ricardo de Queiroz Galvão Roberto de Queiroz Galvão Director ACCOUNTANT Flávio de Castro e Souza CRC-RJ

3 3 C O N S O L I D AT E D B A L A N C E S H E E T S At December 31, 2009 and 2008 (in thousand of US dollars) CONSOLIDATED HOLDING COMPANY ASSETS Current assets: Cash 129,220 83, Marketable securities 755, , Trade accounts receivable 696, , Inventories 287, , Taxes recoverable 100,426 54,941 8,098 5,533 Prepaid expenses 21,104 12, Other receivables 51,537 40, Total current assets 2,041,606 1,273,730 8,164 5,623 Non current assets: Long-term assets: Marketable securities 26,030 16, Judicial deposits 8,468 6, Deferred income tax and social contribution 16,277 2, Other receivables 135, , Investments in subsidiaries (note 5) - 1,860,637 1,239,800 Other investments (note 5) 30,227 15, Fixed assets (note 6) 1,737,663 1,076, Intangible assets 27,735 17, Deferred assets 22,337 15, Total non current assets 2,004,392 1,273,169 1,860,637 1,239,800 See notes to financial statements. 4,045,998 2,546,899 1,868,801 1,245,423 (continued)

4 4 C O N S O L I D AT E D B A L A N C E S H E E T S At December 31, 2009 and 2008 (in thousand of US dollars) CONSOLIDATED HOLDING COMPANY LIABILITIES Current liabilities: Trade accounts payable 276, , Loans 542, , Income tax and social contribution and payroll and social security 159,070 87,571 13,090 8,943 Concession creditors Dividends payable 108,549 86,401 83,551 73,122 Others accounts payable 45,238 31, Total current liabilities 1,131, ,767 96,641 82,065 Non current liabilities: Loans 813, , Concession creditors 1,443 1, Taxes and social contributions payable 17,414 17, Related parties 11,326 76,568 (45,467) 4,522 Deferred income tax and social contribution 30,905 21, Others accounts payable 159,518 74, Discount of price 24,831 18, Deferred income 116,582 40, Total non current liabilities 1,175, ,855 (45,467) 4,522 Minority interest (78,607) 3, Shareholders equity: (note 7) Capital stock 709, , , ,455 Capital reserve Revaluation reserve 8,684 6,470 8,684 6,470 Earning reserve 1,098, ,346 1,098, ,346 1,817,627 1,158,837 1,817,627 1,158,837 4,045,998 2,546,899 1,868,801 1,245,423 See notes to financial statements.

5 5 C O N S O L I D AT E D S TAT E M E N T S O F I N C O M E CONSOLIDATED HOLDING COMPANY Service income 3,706,995 2,364, Equity in earnings of subsidiaries and affiliates (note 5) , ,209 Cost of services (2,889,730) (1,851,279) - - Gross profit 817, , , ,209 Operating income (expenses): Administrative (392,575) (201,520) (16) (82) Depreciation (36,559) (25,347) - - Tax expenses (23,724) (13,093) (5,830) (4,004) Other (17,934) (26,065) - - (470,791) (266,026) (5,846) (4,086) Financial income 226, , Financial expenses (176,652) (113,276) (2) - Financial expenses- interest on shareholders equity (53,986) (36,885) (53,986) (36,885) Reversion - interest on shareholders equity 53,986 36,885 53,986 36,885 49,497 55,416 (2) 0 Profit before social contribution and income tax 395, , , ,123 Social contribution (28,602) (19,194) - - Income tax (56,868) (39,433) - - Reversal of deferred social contribution and income tax 10,762 4, Income before minority interest 321, , , ,123 Minority interest (5,015) (199) - - Net income for the year 316, , , ,123 Earning per share Number of shares of capital stock 1,060,285,439 1,056,483,784 See notes to financial statements.

6 6 S TAT E M E N T S O F C H A N G E S I N S H A R E H O L D E R S E Q U I T Y EARNING RESERVE CAPITAL STOCK CAPITAL RESERVE REVALUATION RESERVE LEGAL RESERVE REALIZABLE PROFITS RETAINED EARNINGS TOTAL Balances at December 31, , ,050 48,542 51, ,516 1,344,256 Gain on translation (168,773) (181) (6,306) (11,750) (12,387) (125,997) (325,395) Dividends payable (64,185) (64,185) Realization of the revaluation reserve - - (13,274) - - 6,195 (7,079) Net income for the year , ,123 Appropriation of net income: Legal reserve ,406 - (12,406) - Constituition of Realizable Profits reserve (535,361) (535,361) Financial expenses-interest on shareholders equity ,361 (36,885) 498,476 Balances at December 31, , ,470 49, ,148-1,158,837 Gain on translation 180, ,214 16, , ,528 Net income for the year , ,248 Appropriation of net income: Legal reserve ,812 - (15,812) - Constituition of Realizable Profits reserve ,450 (246,450) - Financial expenses-interest on shareholders equity (53,986) (53,986) Balances at December 31, , ,684 81,845 1,017,058-1,817,627 See notes to financial statements.

7 7 S TAT E M E N T O F C A S H F L O W CONSOLIDATED HOLDING COMPANY Cash flows from operating activities: Loss for the year 316, , , ,123 Adjustments for: Depreciation 155, , Equity in earnings of subsidiaries and affiliates - - (322,097) (252,209) Minority interest (82,046) (1,914) - - Net value of fixed assets written off 33,966 12, Interest expenses (income) - net (49,497) (55,416) 2-374, ,509 (5,846) (4,086) Decrease (increase) in accounts receivable (297,345) 8, Decrease (increase) in inventories (129,388) (48,703) - - Decrease (increase) in recoverable taxes (45,485) 8,476 (2,565) (4,625) Decrease (increase) in other accounts receivable (57,348) (91,172) - - Increase (decrease) in related parties (65,242) 76,568 (49,989) (12,635) Increase (decrease) in suppliers 95,291 (12,443) - - Increase (decrease) in salaries, charges and tax obligations to pay 71, ,272 4,147 74,574 Increase (decrease) in other trade accounts payable 211,683 12,742 10,429 - Cash flows from operating activities 157, ,769 (43,824) 53,229 ( - ) Interests paid (176,652) (113,276) (2) - Net cash used in operating activities (18,889) 256,493 (43,826) 53,229 Cash flows used in investing activities ( - ) Additions in Fixed assets (868,424) (372,419) - - ( - ) Additions in Invest.in affiliates and subsidiaries (14,851) - (298,741) 54,947 Interest on shareholders equity (53,986) (101,070) (53,986) (101,070) Realization of the revaluation reserve (7,079) Interests received 226, , Net cash used in investing activities (711,112) (305,729) (352,727) (53,202) Cash flows from financing activities Financing 609, , Net cash used in financing activities 609, , Increase in cash and cash equivalents (120,877) 73,449 (396,553) 26 Cash and cash equivalents, beginning of the year 609, , Cash and cash equivalents, end of the year 884, , Gain on translation (396,528) 171,130 (396,528) 21 Increase in cash and cash equivalents (120,877) 73,449 (396,553) 26 See notes to financial statements.

8 8 N O T E S T O C O N S O L I D AT E D F I N A N C I A L S TAT E M E N T S (A translation of the original report in Portuguese containing financial statements prepared in accordance with accounting practices generally accepted in Brazil) 1 > OPERATIONS Queiroz Galvão S.A. is a closely-held holding company, incorporated at February 01, 1998 as part of an ample restructuration process of the Queiroz Galvão group, including new strategic plans and the realignment of operations by business areas. In this context the company has as its main activity investment in the capital of other companies and consulting and management as well. A shareholders extraordinary general meeting held as of August 31, 1998, approved the conversion of the following existing group companies into whole owned subsidiaries of the holding company: Construtora Queiroz Galvão S.A. Operations: Performs general civil engenering work, taking responsibility for the full or piecework construction, for the administration work only, or for execution work. Also participates in the capital of other companies with correlates activities. Queiroz Galvão Participações-Indústria e Agropecuária S.A. Operations: Participation in the capital of companies mainly in the industry and farming fields. Queiroz Galvão Participações-Concessões S.A. Operations: To increment the participation of the Queiroz Galvão group in the capital of companies mainly in the field of public concessions, sanitation, energy and highway. Queiroz Galvão Óleo e Gás S.A. Operations: Performance of services of extraction and production of oil and gas, as well as purchase, import, export, leasing and sale of equipments to the oil industry. Vital Engenharia Ambiental S.A. Operations: Increase the Queiroz Galvão group activities in the areas of services rendering, commerce and transport, through participation in the capital of companies in these line of business. Changed the activities to Develop and rendering services related to Environmental. To stimulate the participation of Queiroz Galvão group in the services areas or concessions of public services of urban cleaning, construction of sanitary terrains, and other similar services. Queiroz Galvão Desenvolvimento Imobiliário S.A. Operations: Increase the Queiroz Galvão group activities in the areas of purchase, sale and construction for sale of buildings.

9 9 N O T E S T O C O N S O L I D AT E D F I N A N C I A L S TAT E M E N T S 2 > PRESENTATION OF FINANCIAL STATEMENTS The financial statements have been prepared in accordance with accounting practices adopted in Brazil, which include the criteria established by Law nº 6404/76 with changes introduced by Law nº 11,638/07 additional rules of the Brazilian Securities and Exchange Commission CVM, and the Brazilian Independent Accountants Institute (IBRACON). 3 > SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES a. Income and expenses Service income, the related costs and other income and expenses are recorded for in accordance to the accrual basis method of accounting. The income tax expense is calculated at the rate of 15% over the taxable income plus a 10% surcharge, which includes fiscal incentives. Social contribution expense was calculated at the rate of 9% applied on adjusted profit before income tax as per the legislation in force. Deferred income tax and social contribution relate to temporally differences in income and expenses accounted which are taxable, for income tax purposes, in the future (mostly in the cash basis of accounting). b. Marketable securities Marketable securities are represented by investments in fixed income securities, banking certificate of deposits, which and debentures are stated at cost, plus accrued income to balance sheet date and do not exceed the market values. c. Inventories Inventories are stated at the lower of the average cost or market. d. Permanent assets Permanent assets are stated at cost (monetarily corrected cost up to December 31, 1995), including the following: Investments in subsidiaries and affiliates are accounted for by the equity method based on the investor financial statements. Other investments are stated at cost. Depreciation of fixed assets is calculated using the straight-line method over the useful lives of the assets. Deferred assets are represented by actual disbursements, net of accrued income. The amortization is calculated using the straight-line method at annual rates of 10% and 20%.

10 10 N O T E S T O C O N S O L I D AT E D F I N A N C I A L S TAT E M E N T S e. Deferred income Income and cost of short-term constructions are recognized as Deferred Income being credited and charged to income at the conclusion of the construction. The result of the sales of the units, concluded on under construction, is accounted for as Deferred Income at the time of the formalization of any document representing the sales commitment. The appropriation as income is made at the moment of the receipt of the installments. f. Translation into United States dollars The United States dollar amounts result from translation of the financial statements at the year-end rate of exchange as follows: R$ to US$ 1.00 R$ to US$ 1.00 The translation should not be construed as representation that the real (R$) amounts actually represent or have been, or could be converted into United States dollars. 4 > SUMMARY OF THE MAIN PROCEDURES USED IN THE CONSOLIDATED OF THE FINANCIAL STATEMENTS The following procedures were adopted in the consolidation of the financial statements: a. Elimination of assets and liability balances among consolidated companies; b. Elimination of the income and expense balances as well as non realized profits among the consolidated companies; c. Reclassification of minority shareholders interest in the consolidated financial statements. d. The consolidated financial statements include the companies mentioned in note 5.

11 11 N O T E S T O C O N S O L I D AT E D F I N A N C I A L S TAT E M E N T S 5 > PARTICIPATION IN WHOLE OWNED SUBSIDIARIES 2009 QUANTITY OF ON SHARES % OF INTEREST CAPITAL STOCK US$ SHAREHOLDERS EQUITY US$ INVESTMENTS US$ EQUITY IN EARNING US$ Investors Construtora Queiroz Galvão S.A. 840, ,452 1,050,122 1,050, ,823 Queiroz Galvão Participações- Concessões S.A. 38, , , ,501 36,935 Queiroz Galvão Óleo e Gás S.A. 3,757, , , ,667 (1,423) Queiroz Galvão Desenv.Imobiliário S.A. 127, , , ,631 9,373 Queiroz Galvão Part.-Ind. e Agropecuária S.A. 79, , , ,812 (16,690) Vital Engenharia Ambiental S.A. 7, ,463 65,903 65,904 17,079 1,860, , QUANTITY OF ON SHARES % OF INTEREST CAPITAL STOCK US$ SHAREHOLDERS EQUITY US$ INVESTMENTS US$ EQUITY IN EARNING US$ Investors Construtora Queiroz Galvão S.A. 840, , , , ,362 Queiroz Galvão Óleo e Gás S.A. 3,757, , , ,407 49,837 Queiroz Galvão Part.-Ind. e Agropecuária S.A. 79, , , ,113 12,935 Vital Engenharia Ambiental S.A. 7, ,510 55,548 55,548 15,203 Queiroz Galvão Participações- Concessões S.A. 38, , , ,835 22,872 1,239, ,209

12 12 N O T E S T O C O N S O L I D AT E D F I N A N C I A L S TAT E M E N T S 6 > FIXED ASSETS 6.1. Fixed asset CONSOLIDATED YEARS TAXES DEPRECIATION Field equipments 20% 277, ,920 Civil construction 4% and 8% 480, ,058 Probes and drilling oil equipment 14% and 20% 27,355 15,463 Machines and equipments 10% and 20% 231, ,212 Vehicles 20% and 40% 213, ,076 Road improvement 10% 36,943 26,941 Permanent plantation and forests 6.6% and 10% 88,303 56,695 Work utensils and other 10% 36,024 21,619 Installations 10% 73,031 14,528 Buildings 4%, 4.26% and 4.33% 198,991 9,056 Airplanes 20% 18,515 3,911 Construction in progress - 9,458 9,141 Development - 481, ,421 Exploration - 92,217 59,817 Lands - 76,523 52,156 Other fixed assets many 68,196 47,474 2,410,205 1,491,489 Less: Accumulated depreciation 672, ,388 1,737,663 1,076, Intangible Software 6,284 3,284 Award rights of concession 2,042 - Trademarks and technology 19,232 13,712 Telephone lines ,735 17,134

13 13 N O T E S T O C O N S O L I D AT E D F I N A N C I A L S TAT E M E N T S 7 > SHAREHOLDERS EQUITY The paid-in capital is represented by 1,060,285,439 ordinary nominative shares, with no par value. At December 31, 2009 the Company s book value per thousand of shares was equivalent to US$ 1, (US$ 1, in 2008). The net income for the year deducted by the interest on shareholders equity is destined as follows: 5% is accounted for as legal reserve, up to the limit of 20% of the capital; 3% is paid to the shareholders as a compulsory minimum dividend. However the general shareholder general meeting has the power to approve the distribution of a different amount or to retain the whole profit. 8 > RELATED PARTIES The transactions were made at usual market rates, terms and values. 9 > FINANCIAL INSTRUMENTS The financial instruments are recorded for in the balance sheet accounts as of December 31, 2009 and 2008 at compatible market value. The management of these instruments is made in a strategic way with the objective of liquidity, profitability and security. The investment control consists of a permanent follow-up of the contracted rates compared to the daily market rates. The company does not operate with derivatives on any other risk assets. 10 > CONTINGENCIES The Company s management, based on the opinion of its legal advisors believes that the appropriate referrals and arrangements for any fiscal, tax, pension and labor liability purposes; have been taken in each situation and are sufficient to preserve the company s equity no indications, in December 31, 2009, of the need to recognize any provision for contingencies in the financial statements. The accounting records and operations are subject to examination of tax authorities in different mature dates according to the specific tax laws applicable.

14 14 I N D E P E N D E N T A U D I T O R S R E P O R T (A translation of the original report in Portuguese containing financial statements prepared in accordance with accounting practices generally accepted in Brazil) THE BOARD OF DIRECTORS AND SHAREHOLDERS QUEIROZ GALVÃO S.A. RIO DE JANEIRO RJ 1. We have audited the accompanying holding and consolidated balance sheets of Queiroz Galvão S.A. as of December 31, 2009, and the related statements of income, changes in shareholders equity and cash flows for the year then ended. These financial statements are the responsibility of the Company s management. Our responsibility is to express an opinion on these financial statements. 2. We conducted our audit in accordance with auditing standards generally accepted in Brazil. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatements. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. 3. In our opinion, the accompanying financial statements referred to above present fairly, in all material respects, the financial position of holding and consolidated Queiroz Galvão S.A. at December 31, 2009, the results of its operations, the changes in its shareholders equity and cashflows for the year then ended, in accordance with accounting practices adopted in Brazil. Rio de Janeiro, April 12, Mário Vieira Lopes Contador-CRC-RJ /O