COSAN S/A 1st Quarter of the Fiscal Year of 2017

Transcription

1 1Q17 Earnings Release COSAN S/A São Paulo, May 10, 2017 COSAN S/A INDÚSTRIA E COMÉRCIO (BM&FBovespa: CSAN3) announces today its results for the first quarter (January, February and March) of 2017 (1Q17). 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 1Q17 and 1Q16, except where indicated differently. 1Q17 Highlights Cosan posted pro forma adjusted EBITDA of R$1.1 billion and net income of R$205 million. Cosan s proforma free cash flow to equity (FCFE), considering 50% of Raízen s results, was R$139 million in the period. Proforma net debt/ebitda (considering Comgás normalized results) dropped to 2.0x. Raízen Combustíveis posted adjusted EBITDA of R$682 million outperforming the market on sales volume. Raízen Energia ended 2016/17 crop year crushing 59.4 million tons of sugarcane. Adjusted EBITDA came to R$751 million in 1Q17, totaling R$3.1 billion in 2016/17 crop year. Comgás posted normalized EBITDA of R$384 million with higher volume sold in all segments. Executive Summary - Cosan Pro forma¹ 1Q17 1Q16 Chg. % 4Q16 Chg. % Net Revenue 11, , % 12, % Gross profit 1, , % 1, % EBITDA , % 1, % Adjusted EBITDA 2 1, , % 1, % Net Income % % Adjusted Net Income n/a % CAPEX % % Free Cash Flow to Equity % 1, % Net Debt 4 9, , % 10, % Leverage (Net Debt/EBITDA LTM) 5 2.0x 2.5x -0.5x 2.1x -0.1x Dividend Announced % % Note 1: Considering 50% of the results of Raízen Combustíveis and Raízen Energia Note 2: Adjusted and EBITDA and Net Income 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 May 11, 2017 (Thursday) Portuguese 10:00 a.m (Brasília time) Dial-in: Code: COSAN English 11:00 a.m. (Brasília time) Dial-in (BR): Dial-in (USA): Code: COSAN Investor Relations ri@cosan.com.br Tel: Website: ri.cosan.com.br 1 de 24

2 A. Cosan - Consolidated Results Business Units Cosan's business units and interest in each reportable segment are shown below: Raízen Combustíveis (50%) Raízen Energia (50%) Comgás (62.6%) 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 1Q17 and 1Q16, except where indicated differently. Executive Summary 1Q started with first signs of economic upswing, yet there is still not enough evidence of a structural improvement. The challenge of approving reforms required to ensure sustainable recovery of Brazillian economy remains and unemployment index is still high. Inflation and interest rates, however, keep falling, while a few economic segments, such as automotive production, showed first signs of improvement (light and heavy vehicles production jumped 21% and 5%, respectively, y/y in march/17 ANFAVEA data). Cosan S/A Proforma: Adjusted EBITDA was R$1.1 billion in 1Q17 (-4%), since favorable results of Raízen Combustíveis and Comgás were partially offset by lower accounting profit of Raízen Energia, which was affected by foreign exchange (non-cash effect). Including the effect of currency hedge on sugar exports, adjusted EBITDA would have been R$1.2 billion (+8%). We ended the 2016/17 sugarcane crop evidencing our capacity to capture production efficiencies, which coupled with the favorable price scenario, enabled a substantial increase of cash generation, with the currency hedge accounted as financial gain. At Raízen Combustíveis, we continued to focus on service stations network expansion and maintenance, privileging long-term relationship with our dealers and optimizing our supply and commercialization strategy. At Comgás, the beginning of 2017 recorded a small recovery in the industrial consumption, while residential and commercial segments continue growing through new connections. At Moove, we outperformed the industry average in Brazil again and increased sales volumes at international operations. With better operating results, the pro forma Cash Flow from Operating Activities (CFO) came to R$2.2 billion (+4%), while Free Cash Flow to Equity (FCFE) totaled R$139 million. Leverage (proforma Net Debt/EBITDA) reached 2.0 times at the end of the period, excluding Comgás regulatory current account effects. Raízen Combustíveis: Adjusted EBITDA grew 16% to R$682 million in 1Q17. The expansion reflects higher volume sold with a better sales mix, coupled with continued gains from the supply and commercialization strategy and cost reductions. The fuel distribution market in Brazil started 2017 with lower drop of consumption when compared to last quarters. Total volume sold fell 1% in 1Q17 (ANP data). Sales of gasoline equivalent showed signs of recovery, growing 1% in the country (ANP base). Raízen s sales outperformed the industry average, going up 1% in total, while Otto cycle sales increased 3% year-on-year (4% in gasoline equivalent). Diesel sold by Raízen was up 3% in the quarter driven by new agreements with industrial clients. Raízen Energia: Adjusted EBITDA (excluding biological asset variation, debt hedge accounting and non-recurring effects) came to R$751 million (-36%) in 1Q17, mainly affected by (i) lower concentration of sales in the period, (ii) higher CONSECANA and (iii) lower foreign exchange rate in the period, despite improved sugar sales average price. The 2016/17 crop year ended with total crushing of 59.4 million tons of sugarcane (-5%), affected by lower productivity compared with previous crop (TCH reduction due to lower rainfall volume, partially offset by slightly improved TRS). Sales volume in sugar equivalent dropped 4%, offset by higher sugar and ethanol sales average prices. The unit average cash cost, excluding the effects from CONSECANA, was 2% lower in the 2016/17 crop, absorbing inflation and evidencing efficiency gains in the productive and industrial processes. Adjusted EBITDA of the crop year was R$3.1 billion (-11%). Including the effect of currency hedge on sugar exports, adjusted EBITDA would have been R$3.7 billion versus R$3.0 billion in previous crop year. 2016/17 CAPEX was up 18% to R$2.1 billion, in line with guidance. Comgás: EBITDA, normalized by regulatory current account effect, was R$384 million (+19%) in 1Q17, reflecting volume growth (3% ex thermal) and margins correction by inflation (9.8%) in May Sales volume in the industrial segment was up 3% year-on-year, due to higher consumption of few industries and weak basis of comparison. Commercial sales volume was up 5% year-on-year, chiefly due to the addition of new clients in the last 12 months. The residential segment ended the quarter with modest 1% growth, since results from client base expansion were offset by lower unit consumption due to higher average temperature in the period. The regulatory current account recorded a R$60 million reduction during the quarter and ended the period with a balance of R$354 million in favor of clients. 2 de 24

3 Moove: EBITDA in 1Q17 was up 67% to R$43 million, as a result of higher volume sold (+6%) and better sales mix. Moove outperformed Brazilian lubricant market (-1%) reporting a 1% increase compared to the same period last year (SINDICOM data). 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 17 of this report. Operating and Financial Metrics Raízen Combustíveis 1Q17 1Q16 Chg.% 4Q16 Chg.% (Jan-Mar) (Jan-Mar) 1Q17/1Q16 (Oct-Dec) 1Q17/4Q16 Otto Cycle Volume (Gasoline+ Ethanol) ('000 cbm) 2,900 2,822 3% 3,060-5% Gasoline Equivalent 6 Volume ('000 cbm) 2,755 2,636 4% 2,883-4% Diesel Volume ('000 cbm) 2,625 2,538 3% 2,638 0% Adjusted EBITDA Margin 7 (BRL/cbm) % % Adjusted EBIT 7 (BRL/cbm) % % Note 6: Sum of gasoline and ethanol volumers, adjusted by the energy coefficient of 0,7221. Note 7: Excludes non-recurring items, as detailed on page 5 herein. Raízen Energia 1Q17 1Q16 Chg.% 2016/ /16 Chg.% (Jan-Mar) (Jan-Mar) 1Q17/1Q16 (Apr-Mar) (Apr-Mar) 16/17x15/16 Sugarcane Crushed (mln mt) % % Average TRS (kg/ton) n/a n/a % TRS/ha n/a 10.3 n/a % Sugar/Ethanol Production Mix n/a 51% x 49% n/a 57% x 43% 55% x 45% n/a Adjusted EBITDA 8 (BRL mln) 751 1,168-36% 3,092 3,459-11% Adjusted EBIT 8 /TRS sold (BRL/ton) % % Note 8: Excludes non-recurring effects, as detailed on page 5 herein. Comgás 1Q17 1Q16 Chg.% 4Q16 Chg.% (Jan-Mar) (Jan-Mar) 1Q17/1Q16 (Oct-Dec) 1Q17/4Q16 Total Sales Volume (mln cbm) Ex-Thermal 1, % 1,047-4% Normalized EBITDA 9 (BRL mln) % 359 7% IFRS EBITDA (BRL mln) % 308 2% Note 9: Includes the effect from the regulatory Current Account. Moove 1Q17 1Q16 Chg.% 4Q16 Chg.% (Jan-Mar) (Jan-Mar) 1Q17/1Q16 (Oct-Dec) 1Q17/4Q16 Total Sales Volume ('000 cbm) % 81 0% EBITDA (BRL mln) % 46-6% 3 de 24

4 Cosan Consolidated Results The following table provides a breakdown of the 1Q17 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 1Q17 Comgás Moove Cosan Corporate Adjustments and Eliminations Cosan S/A Accounting Raízen Combustíveis Raízen Energia 50% Raízen Adjustments and Eliminations Consolidated Pro forma Net Revenue 1, , , ,913.2 (10,305.7) (295.7) 11,603.2 Cost of Goods and Services Sold (720.1) (314.0) (1.1) - (1,035.2) (16,746.9) (2,232.1) 9, (10,229.0) Gross Profit (0.9) (816.2) - 1,374.1 Gross Margin (%) 37.2% 29.7% n/a n/a 35.0% 5.4% 23.4% % Selling Expenses (167.8) (87.4) (0.1) - (255.2) (314.1) (144.3) (484.4) General and Administrative Expenses (77.1) (20.2) (39.6) - (136.9) (116.2) (158.8) (274.4) Other Operating Income (Expenses) (0.6) 0.1 (13.4) - (13.8) (45.8) (85.3) (79.4) Equity Pick-up - (1.6) (53.5) (37.3) 18.6 (256.4) (18.2) Depreciation and Amortization (299.5) EBITDA (53.5) (664.7) (256.4) EBITDA Margin (%) 27.3% 9.7% n/a n/a 35.5% 3.5% 24.2% % Financial result (41.4) (19.8) (73.8) - (135.0) (172.1) (153.6) Income and Social Contribution Taxes (55.7) (2.7) (37.3) (89.4) (77.6) (120.8) Non-controlling Interest (31.2) (31.2) (13.7) (38.0) Net Income (Loss) (84.7) (256.4) (256.4) de 24

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) effects from asset divestments, and (ii) nonrecurring gains/losses, if applicable. o Nonrecurring effects in the periods: 1Q17: (i) Provision for tax credits recover and (ii) eliminations between Raízen Energia and Combustíveis. 4Q16: Provision for tax credits recover. 1Q16: Internal restructuring expenses. Raízen Energia: (i) variation in biological assets, (ii) hedge accounting impacts related to debt and (iii) non-recurring gains/losses where applicable. o Nonrecurring effects in the period: 1Q17: Provision for losses on logistics investments and reversion of unrealized result between Raízen Energia and Raízen Combustíveis. Comgás: effect from the regulatory current account. Cosan Corporate: o Nonrecurring effects on net income in the period: 4Q16: (i) credits from severance claims and (ii) income from Radar divestment. Adjusted EBITDA 1Q17 1Q16 Chg.% 4Q16 Chg.% Pro forma EBITDA , % 1, % Raízen Combustíveis (50%) n/a (90.7) n/a Asset Divestments 12.9 (5.2) n/a (2.7) n/a Non-recurring Effects % (88.0) n/a Raízen Energia (50%) 23.6 (177.5) n/a (164.4) n/a Change in Biological Assets (44.1) (177.5) -75.1% (164.4) -73.2% Hedge Accounting - Debt n/a - n/a Non-recurring Effects n/a - n/a Comgás Regulatory Current Account (100%) 70.9 (197.2) n/a % Cosan Corporate - Non-recurring Effects (100%) - - n/a - n/a Adjusted Pro forma EBITDA 1, , % 1, % Adjusted Net Income 1Q17 1Q16 Chg.% 4Q16 Chg.% Net Income % % Raízen Combustíveis (50%) n/a (59.8) n/a Asset Divestment 8.5 (3.4) n/a (1.8) n/a Non-recurring Effects % (58.0) n/a Raízen Energia (50%) (7.1) (117.2) -93.9% (108.5) -93.5% Change in Biological Assets (29.1) (117.2) -75.1% (108.5) -73.2% Non-recurring Effects n/a - n/a Comgás Regulatory Current Account (100%) 29.3 (79.8) n/a % Cosan Corporate - Non-recurring Effects (100%) - - n/a n/a Adjusted Net Income (Loss) n/a % 5 de 24

6 B. Results by Business Unit B.1 Raízen Combustíveis The fuel distribution market in Brazil started 2017 with weaker drop of consumption when compared to previous quarters. Total volume sold fell 1% in 1Q17 (ANP data) year-on-year, while the drop seen in 4Q16 was 6% versus 4Q15. Aviation fuel sales recorded highest drop (-7%). Sales of Otto-cycle (gasoline + ethanol) came in line with same period last year. On a gasolineequivalent basis, i.e., adjusting ethanol for its energy efficiency (72.2%), the market recorded growth (+1%) compared to 1Q16 after several quarters of shrinkage. Raízen Combustíveis outperformed the industry average again and remains focused on long-term relationship with service stations network. Otto cycle sales grew 3% in 1Q17 year-on-year (-5% versus 4Q16 due to seasonality). On a gasolineequivalent basis, sales volume grew 5% (-4% versus 4Q16), reflecting the higher sales volume of gasoline (+3%) compared to ethanol (-21%). Gasoline prices were adjusted by Petrobras, increasing competitiveness and demand for such product accordingly. Raízen s diesel sales volume was up 3% in 1Q17 (-1% versus 4Q16) reflecting new agreements with industrial clients, partially offset by weaker demand of agriculture sector due to longer intercrop period when compared to 1Q16. The aviation segment was again affected by weaker air traffic in the quarter, with 12% drop (-3% versus 4Q16), translating into 7% reduction in the number of departures, according to ANAC data. Raízen s total volume sold in 1Q17 was up 1% year-on-year (-3% versus 4Q16). Sales Volume 1Q17 1Q16 Chg.% 4Q16 Chg.% 000 cbm (Jan-Mar) (Jan-Mar) 1Q17/1Q16 (Oct-Dec) 1Q17/4Q16 Total Volume 10 6,115 6, % 6, % Ethanol % % Gasoline 2,376 2, % 2, % Diesel 2,625 2, % 2, % Aviation % % Other Products % % Note 10: Excludes sales to other distributors, in accordance with SINDICOM methodology. Raízen Combustíveis net revenue grew 8% compared to 1Q16 to R$17.7 billion, due to higher volume sold and better gasoline and diesel average prices. In the quarter, net revenue was impacted by R$44 million rebate (R$40 million in 1Q16), referring to discounts on fuel sales for achieving certain targets. Cost of goods sold in 1Q17 increased 7% to R$16.7 billion, due to (i) higher volumes sold, (ii) fuel cost adjustments and (iii) higher logistics expenses in view of Raízen s supply strategy. Selling, general and administrative expenses were R$430 million (-6%) in 1Q17, reflecting gains in cost efficiency once network keeps growing. In addition, lower marketing expenses campaigns in the quarter compared to the same period last year were partially offset by inflation effects on general expenses and higher logistics expenses in view of the supply strategy. Other revenue came to R$52 million, adjusted for non-recurring effects of: (i) tax recovery/expense related to costs incurred in previous years and (ii) assets divestment in 1Q17. Adjusted EBITDA grew 16% to R$682 million in 1Q17, reflecting higher volume sold with a better sales mix, coupled with continued gains from the supply and commercialization strategy and cost reductions. Adjusted EBIT, which includes the depreciation and amortization of investments in infrastructure, renovation and expansion of the service stations network, increased 27% to R$573 million. Compared to 4Q16, adjusted EBITDA and EBIT went down 24% and 27%, respectively. EBITDA 1Q17 1Q16 Chg.% 4Q16 Chg.% EBITDA % 1, % Asset Divestments 25.9 (10.4) n/a (5.4) n/a Other extraordinary effects % (175.9) n/a Adjusted EBITDA % % EBIT % % Adjusted EBIT % % Raízen Combustíveis CAPEX climbed 27% to R$227 million, impacted by higher focus on expansion and renovation of the service stations network in line with current Capex plan. The pace of expansion and renovation of network follows the trend seen in previous quarters. Some negotiations that were originally estimated to be concluded at the end of last year, however, slipped through to this quarter. Raízen ended 1Q17 with 6,043 Shell branded service stations. 6 de 24

7 B.2 Raízen Energia The 2016/17 Brazilian sugarcane crop ended in March 2017, totaling 607 million tons (-2%) in the south-central region, which concentrates most of sugar and ethanol mills in Brazil. According to UNICA Union of Sugarcane Mills, reduced crushing in Brazilian crop was offset by 2% improvement in the quality of raw material, which reached 133 kg total recoverable sugar (TRS) per ton of cane, compared to 131 kg/ton in previous crop year. The sugar production mix in the center-south region reached 46% at the end of crop versus 41% in the 2015/16 crop year, driven by higher commodity prices (NY#11) and lower ethanol competitiveness against gasoline in main consumer regions. The 1Q17, Raízen Energia s 2016/17 crop fourth quarter and intercrop period, concentrates maintenance activities. Different from 1Q16 when the intercrop period was shortened due to anticipated crushing initiated in March, there was no crushing this quarter. Final crushing of the 2016/17 crop year came to 59.4 million tons, 5% lower volume, reflecting (i) reduced yield (TCH - 80 tons/hectare versus 89 in previous crop) affected by lower rainfall volume and (ii) crushing of 2.8 million tons in March, included in previous crop. Average TRS of the 2016/17 crop was 129 kg/tons, above 128 kg/tons of previous crop. The final production mix was 57% sugar (versus 55% in the 2015/16 crop), in line with commercialization strategy focused on sugar maximization. Adjusted net revenue in 1Q17 was R$3.0 billion (-22%), reflecting a lower concentration of sales volumes and lower ethanol average sales price, offsetting better sugar average sales price. In the 2016/17 crop, adjusted net revenue totaled R$12.3 billion (+0.5%), due to lower sales volumes in all products, offset by better sugar and ethanol average sales prices. Below the effects on volume and net revenue from main products: Sugar: Adjusted net revenue dropped 24% to R$1.4 billion, due to 28% reduction in volumes sold in 1Q17, compared to the same period last year. Such reduction was partially offset by better average price in Reais R$1,303/ton in current quarter (+6%). Adjusted net revenue totaled R$5.4 billion (-2%) in the crop year, affected by 9% reduction in volume sold, partially offset by better sales price in Reais R$1,252/ton (+7%). Ethanol: Net revenue in the quarter was R$1.5 billion (-21%) due to lower volumes sold (-19%) and average price realized in the period - R$1,859/m³ (-2%) in 1Q17, in line with market prices (ESALQ). In the crop year, net revenue from ethanol totaled R$6.1 billion (+4%), reflecting better average price - R$1,778/m³ (+4%) and volume sold in line with previous crop (-1%). Cogeneration: In 1Q17, net revenue came to R$41million (-6%) reflecting 222,000 MWh (-24%) of energy sold. At the end of the 2016/17 crop year, lower biomass availability resulted in reduced sales volume (-2%), totaling 2.8 million MWh and affecting net revenue which came to R$518 million (-12%). The average price of energy sold in the crop was R$185/MWh (-10%) due to lower spot price, which affects nearly 20% of total energy sold. Sales Breakdown 1Q17 1Q16 Chg.% 2016/ /16 Chg.% BRL mln (Jan-Mar) (Jan-Mar) 1Q17/1Q16 (Apr-Mar) (Apr-Mar) 16/17 / 15/16 Adjusted Net Revenue 3, , % 12, , % Sugar Sales 1, , % 5, , % Domestic Market % 1, , % Export Market 11 1, , % 3, , % Ethanol Sales 1, , % 6, , % Domestic Market 1, , % 3, , % Export Market % 2, , % Energy Cogeneration % % Other Products and Services % % Hedge Accounting - Debt (110.1) - n/a (110.1) (360.6) -69.5% Net Revenue 2, , % 12, , % Note11: Net revenue from sugar exports includes the effect from hedge accounting - debt. Sugar ( 000 tons) Sales Volume 1Q17 vs. 1Q16 Ethanol ( 000 cbm) 7 de 24

8 Sugar ( 000 tons) Sales Volume 2016/17 vs. 2015/16 Ethanol ( 000 cbm) Sugar Inventories Ethanol Inventories 03/31/ /31/2016 Chg.% 12/31/2016 Chg.% 03/31/ /31/2016 Chg.% 12/31/2016 Chg.% '000 ton n/a 1, % '000 m³ % % BRL mln n/a 1, % BRL mln % 1, % BRL/ton % % BRL/cbm 1,694 1, % 1, % Cost of goods sold totaled R$2.2 billion in 1Q17, down 16% year-on-year, due to lower concentration of sales in the quarter. Unit cash cost of production in sugar-equivalent followed the trend of crop year and grew 9% (R$719/ton), impacted by higher CONSECANA reference price (+23%), which directly affects land lease agreements and the acquisition of third-party sugarcane. Excluding this effect, unit cash cost dropped 5% in the quarter. At the end of the 2016/17 crop year, the cost of goods sold was up 3% to R$9.5 billion, despite lower sales volume. Unit cash cost was R$669 million (+13%). Excluding the effect from the higher CONSECANA price, unit cash cost would be 2% lower, absorbing inflation in crop year and reflecting continued focus on efficiency in agricultural and industrial operations. Cost of Goods Sold 1Q17 1Q16 Chg.% 2016/ /16 Chg.% BRL mln (Jan-Mar) (Jan-Mar) 1Q17/1Q16 (Apr-Mar) (Apr-Mar) 16/17 / 15/16 Cost of goods sold (2,232.1) (2,667.1) -16.3% (9,532.6) (9,231.0) 3.3% Unit (Cash) Costs 12 - Sugar Equivalent (R$/ton) (718.8) (660.7) 8.8% (665.9) (591.8) 12.5% Sugar (BRL/ton) (698.6) (663.6) 5.3% (669.1) (591.9) 13.0% Ethanol (BRL/cbm) (1,204.8) (1,051.3) 14.6% (1,058.9) (946.9) 11.8% Unit (Cash) Costs 12 - Ex CONSECANA (R$/ton) (630.7) (660.7) -4.5% (577.8) (591.8) -2.4% Note 12: Average 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 down 14% to R$303 million in 1Q17, chiefly due to reduced selling expenses as a result of lower sales volume in the quarter. In crop year, selling, general and administrative expenses increased 4% to R$1.3 billion, in line with inflation in the period and mainly influenced by higher freight costs. Adjusted EBITDA in 1Q17 totaled R$751 million (-36%) and was affected by lower volume sold in the period due to commercialization strategy for the crop, partially offset by higher sugar average sales price in Brazilian Reais. The adjustments were: (i) R$88 million biological assets positive variation; (ii) R$110 million negative impact from debt hedge accounting, (iii) R$132 million provision for losses related to Raízen s logistics investments and (iv) reversion of unrealized gain between Raízen Energia and Raízen Combustíveis on previous quarter. As pointed out in previous releases, sugar pricing at Raízen is set in Reais (commodity and currency hedge). Brazilian Real appreciation against the US dollar is still affecting EBITDA in the period, since revenue recognized in sugar exports reflects the exchange rate of the shipment date. On the other hand, a gain of R$174 million was recorded in 1Q17 financial result, via currency hedge instruments contracted to determine revenues in Reais, which would grow adjusted EBITDA to R$925 million. The average of currency hedges for shipments was R$3.73/USD, compared to the actual average exchange rate (average PTAX) of R$3.12/USD. The same effect generated a negative impact of R$602 million over EBITDA of the 2016/17 crop year. In the 2016/17 crop year, lower sales volume affected adjusted EBITDA which went down 11% to R$3.1 billion, in line with the guidance for the period. Including the currency hedge effect, adjusted EBITDA 16/17 reached R$3.7 billion growing 25% over 15/16 crop year. EBITDA and EBIT 1Q17 1Q16 Chg.% 2016/ /16 Chg.% BRL mln (Jan-Mar) (Jan-Mar) 1Q17/1Q16 (Apr-Mar) (Apr-Mar) 16/17 / 15/16 EBITDA , % 3, , % (-) Change in biological assets (88.3) (355.0) -75.1% (319.1) (350.3) -8.9% (-) Hedge Accounting - Debt n/a % (-) Non-Recurring Effects from unrealized n/a n/a Adjusted profits EBITDA , % 3, , % Adjusted EBITDA Margin (%) 25.8% 30.2% -4.4 p.p. 25.4% 29.1% -3.8 p.p. EBIT % 1, , % Adjusted EBIT % 1, , % 8 de 24

9 The position of sugar volumes and prices (including polarization premium) defined with trading or via derivative financial instruments in US dollars and converted into Reais, including polarization premium, until March 31, 2017, respectively, are summarized as follows: Summary of Hedge Operations at 03/31/ Sugar 2017/ /2019 Volume ('000 ton) 1, Average Price 14 (centavos/lb) Average Price ( /lb) Note 13: Hedge coverage is based on the crop years ending in 3/31/2017 and 3/31/2018. Note 14: The average price in /lb considers the exchange rate hedged through financial instruments. Net revenue is recorded at the exchange rate realized during the period. Raízen Energia s investments came to R$897 million (+11%) in 1Q17, reflecting (i) higher investment in plantation areas and (ii) anticipation of projects related to Health, Safety and Environment (SSMA) and Sustaining. In the 2016/17 crop year, Raízen Energia s Capex was up 18% to R$2.1 billion, in line with the guidance for the period. Such increase when compared to the previous crop year is chiefly due to higher investment in (i) planting and tilling to adjust cane plantation renovation level to 15%; (ii) mandatory investments connected with SSMA and Sustaining and (iii) investments in other projects. CAPEX 1Q17 1Q16 Chg.% 2016/ /16 Chg.% BRL mln (Jan-Mar) (Jan-Mar) 1Q17/1Q16 (Apr-Mar) (Apr-Mar) 16/17 / 15/16 Total CAPEX % 2, , % Maintenance CAPEX % 1, , % Biological Assets % % Off-season Maintenance % % Operating CAPEX % % HES & Sustaining n/a n/a Mechanization % % Industrial % % Projects CAPEX % % Cogeneration and Expansion % % Other Projects % % 9 de 24

10 B.3 Comgás Comgás ended the first quarter of 2017 with 3% higher natural gas sales volume (ex-thermogeneration), recording growth across all segments. In the industrial segment, the 3% increase in volumes is explained by higher consumption from clients of few specific sectors, besides low basis of comparison of 1Q16. The commercial segment grew 5% in 1Q17, sustained by new clients added over the last 12 months, offsetting slower economic activity in the period whereas the residential segment was 1% higher, reflecting the addition of 109,000 new clients in the last 12 months, but partially offset by lower unit consumption due to higher average temperature in the quarter. Sales Volumes 1Q17 1Q16 Chg.% 4Q16 Chg.% 000 cbm (Jan-Mar) (Jan-Mar) 1Q17/1Q16 (Oct-Dec) 1Q17/4Q16 Total Natural Gas Sales 1,008,246 1,058, % 1,135, % Natural Gas Sales, ex-thermal power 1,008, , % 1,046, % Residential 47,440 47, % 64, % Commercial 32,530 30, % 35, % Industrial 812, , % 821, % Cogeneration 67,886 61, % 73, % Automotive 48,136 45, % 51, % Thermal Power 0 84, % 88, % Comgás posted net revenue of R$1.1 billion (-22%) in 1Q17, reflecting the reduction in tariffs defined by ARSESP s ordinances on May and September It is worth mentioning that these reductions occurred due to lower gas cost and did not affect Company s margins. These effects were partially offset by higher sales with a greater share of residential and commercial segments. Costs with gas and transportation, excluding construction and others, stood at R$664 million (-13%) in the quarter, explained by lower average unit cost of gas following US dollar depreciation against the Real when compared to 1Q16. Selling, general and administrative expenses were R$245 million (+8%) in 1Q17, reflecting higher sales volume and inflation over expenses in the period. EBITDA, normalized by regulatory current account, was R$384 million (+19%) in the period, positively affected by inflation adjustment of margins (+9.8%) in May and higher volumes sold. IFRS EBITDA was R$313 million (-40%) due to changes in gas cost compared to 1Q16 and resulting impacts on the regulatory current account. Regulatory current account ended 1Q17 with a balance of R$354 million in favor of clients, following R$60 million reduction during the quarter. EBITDA 1Q17 1Q16 Chg.% 4Q16 Chg.% Normalized EBITDA % % Normalized EBITDA Margin (%) 33.5% 22.1% 11.4 p.p 27.1% 6.4 p.p IFRS EBITDA % % IFRS EBITDA Margin (%) 27.3% 35.6% -8.3 p.p. 23.3% 4.1 p.p Comgás invested R$75 million (-21%) in the quarter, reflecting the planning of lower Capex in early Out of total amount invested in the quarter, 63% was allocated to expanding the gas distribution network. The complete earnings release of Comgás is available at ri.comgas.com.br. Page 24 of this report presents a reconciliation of Comgás' EBITDA and Net Income based on Cosan s accounting perspective. 10 de 24

11 B.4 Moove Brazilian lubricant market remains affected by economy slowdown with sales volume dropping 1% in the country in 1Q17 (SINDICOM figures). Moove outperformed the industry average again by growing sales volumes by 1%, reflecting the strategy of growing market share among OEM automakers in Brazil. Base oil sales increased in Brazil, while the performance of operations in other countries in which it operates improved, boosting 6% growth in total volume sold. Net revenue in 1Q17 was R$447 million (-7%), chiefly due to a lower exchange rate in the period which impacts international operations. On the other hand, the Brazilian Real appreciation contributed to lower cost of products sold. EBITDA in the quarter climbed 67% to R$ 43 million, reflecting higher volume and better sales mix year-on-year. EBITDA 1Q17 1Q16 Chg.% 4Q16 Chg.% BRL mln (Jan-Mar) (Jan-Mar) 1Q17/1Q16 (Oct- 1Q17/4Q16 EBITDA % Dec) % EBITDA Margin (%) 9.7% 5.4% 4.3 p.p 10.2% -0.5 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 1Q17 1Q16 Chg.% 4Q16 Chg.% General and Administrative Expenses (39.6) (42.0) -5.5% (43.3) -8.4% Other Operating Income (Expenses) (13.4) (39.3) -65.9% (16.6) -19.0% EBITDA ex- Equity Pick-up (49.7) (78.8) -36.9% (57.7) -13.8% (+) Equity Pick-up % % EBITDA % % General and administrative expenses totaled R$40 million (-6%) in 1Q17, in line with expectations. Other expenses, composed of legal and consulting expenses in the quarter came to R$13 million (-66%) due to lower concentration of expenses in the period. 11 de 24

12 C. Other Lines of the Consolidated P&L (ex-raízen) Financial Result Financial Result 1Q17 1Q16 Chg.% 4Q16 Chg.% Cost of Gross Debt (169.6) (336.1) -49.5% (252.7) -32.9% Perpetual Notes 11.9 (114.6) n/a (58.5) n/a Interest of Debts (181.5) (221.5) -18.0% (194.2) -6.5% Interest Income % % (=) Subtotal: Interest on Net Debt (53.2) (243.6) -78.1% (158.1) -66.3% Other Charges and Monetary Variation (69.7) (203.3) -65.7% (44.9) 55.2% Banking Expenses, Fees and Other (12.1) (8.8) 37.9% (86.6) -86.0% Net Financial Result (135.0) (455.7) -70.4% (289.6) -53.4% Net financial expenses amounted to R$135 million, decreasing 70%. Total cost of gross debt (which includes interest expenses, exchange variation and derivative gain/loss) decreased R$166 million (-49%), mainly due to i) the absence of derivatives hedging the Perpetual Bond principal, and ii) drop in the interest rate and forex forward curves in the period. Note that as of August 2016, we do not designate instruments to hedge the principal of the perpetual bond, with only the interest hedged for a certain period. The average weighted cost of Cosan s debt (ex Raízen) corresponds to 102% of CDI. Interest income grew R$24 million, due to the higher average cash balance year-on-year. Other charges went down 66% to R$70 million in 1Q17, chiefly due to fair value variation (non-cash effect) of put options held by funds controlled by Gávea and TPG for conversion of Rumo shares into Cosan S.A. shares, which negatively affected the 1Q16. 1Q17 was only affected by such effect up to TPG s exercise in February, partially offset by appreciation of Rumo shares held by Cosan. Income and Social Contribution Taxes The following table provides a breakdown of income and social contribution tax expenses of 1Q17 by business unit Income and Social Contribution Taxes BRL mln Comgás Moove Cosan Corporate Adjustments & Elimination Consolidated Operating Profit before Taxes (53.5) Income and Social Contribution Taxes, Nominal Rate (%) -34.0% -34.0% -34.0% -34.0% -34.0% Theoretical Expense with Income and Social Contribution (47.3) (1.3) (62.6) 18.2 (93.1) Non-taxable Permanent Differences/Equity Pick-up (3.7) (18.2) 62.9 Difference from taxable and presumed profit base Other (4.7) (1.7) (0.7) - (7.1) Effective Expense with Income and Social Contribution Taxes (55.7) (2.7) (37.3) Income and Social Contribution Taxes, Effective Rate (%) -40.0% -70.7% 11.5% 0.0% -13.6% Expenses with Income and Social Contribution Taxes (55.7) (2.7) (37.3) Current 39.4 (0.1) (2.4) Current Tax, Effective Rate (%) 28.3% -1.4% -1.3% 0.0% 13.5% Deferred (95.2) (2.7) (74.3) Net Income Cosan posted net income of R$205 million in 1Q17, 17% lower than the net income of R$246 million recorded in 1Q16. It is worth mentioning that net income in 1Q17 was negatively impacted by non-recurring effects at Raízen and by current account reduction at Comgás, as mentioned in the EBITDA and Adjusted Net Income sections of this report. 12 de 24

13 D. Loans and Financing At the close of 1Q17, Cosan s proforma consolidated gross debt (excluding PESA at Raízen Energia) stood at R$13.7 billion (-5%) reflecting payments of principal and interest rates (with cash impact) totaling R$1.8 billion and (ii) proceeds of USD 500 million from Senior Notes 2027, both at Raízen. Cosan S/A's proforma leverage ratio (including obligations with preferred shareholders) ended the quarter at 1.9x Net Debt/EBITDA, based on proforma 1Q17 EBITDA of R$966 million. If we consider Comgás normalized results, adjusted by regulatory current account, leverage would be 2.0x. Proforma net debt, excluding obligations with preferred shareholders, totaled R$7.6 billion in 1Q17. Obligations with preferred shareholders came to R$1.8 billion at the end of 1Q17. Loans and Financing 1Q17 BRL mln Comgás Moove Cosan Corporate Consolidated Raízen Energia Raízen Combustíveis Consolidated Pro forma Opening balance of pro forma net debt 1, , , , ,294.2 Cash, cash equivalents and marketable securities 2, , , , ,134.5 Gross Debt 3, , , , ,428.6 Cash items (140.6) (55.5) (285.1) (481.2) (636.7) (6.4) (1,124.4) Funding Payment of principal on loans and borrowings (118.0) (42.6) (76.1) (236.7) (1,358.9) (2.0) (1,597.5) Payment of Interest on loans borrowings (35.9) (1.0) (136.9) (173.8) (43.4) (4.5) (221.6) Derivatives 4.3 (11.9) (160.4) (167.9) - - (167.9) Noncash items (77.4) Provision for interest (accrual) Monetary variation and MTM adjustment of debt (2.8) Exchange variation, net of derivatives 16.6 (7.4) (208.9) (199.7) (79.0) (85.5) Closing balance of gross debt 3, , , , ,670.7 Cash, cash equivalents and marketable securities 2, , , , ,083.3 Closing balance of pro forma net debt 1, , , , ,587.4 Obligations due to preferred shareholders of subsidiaries Total pro forma net debt and obligations due to preferred shareholders of subsidiaries - - 1, , , , , , , ,396.6 E. Reconciliation of the Change in Net Debt Cash Flow Statement 1Q17 BRL mln Comgás Moove Cosan Corporate Elimin. Cosan S/A Raízen Combined Elimin. Cosan S/A Pro forma Balance of Net Debt at start of period (1,322.1) (283.7) (2,698.0) - (4,303.9) (3,990.3) - (8,294.2) Balance of Net Debt at end of period (1,584.6) (367.0) (2,288.1) - (4,239.7) (3,347.7) - (7,587.4) Change in Net Debt (262.5) (83.3) Non-cash items Interest Accrual Monetary variation and MTM adjustment of debt Exchange Variation, net of derivatives 16.6 (7.4) (208.9) - (199.7) (85.5) Cash change in Net Debt (157.9) (76.9) ,073.2 Reconciliation of Cash Generation EBITDA (53.5) (256.4) Noncash impacts on EBITDA (296.8) 53.5 (225.3) Changes in assets and liabilities (54.7) (115.5) (21.7) (1.5) Operating financial result Operating cash flow (64.9) (21.7) , ,155.6 Capex (68.7) (1.7) (0.3) - (70.8) (574.3) - (645.0) Other - - (275.8) - (275.8) (256.8) Cash flow after investments (68.7) (1.7) (276.1) - (346.5) (555.3) - (901.8) Other Effects Ex Debt - (9.2) (5.3) Dividends Received (246.7) (279.9) - Cosan S/A Comgás (421.6) (153.2) - - (153.2) Raízen (300.1) - (300.1) Dividends Payed (421.6) (153.2) (300.1) (173.4) Exchange variation impact on cash and cash equivalents - (1.1) (8.6) - (9.7) (6.5) - (16.2) Change in Net Debt (157.9) (76.9) , de 24

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 proforma basis ("Proforma Consolidated"), considering 50% of Raízen's results. Cash Flow Statement 1Q17 1Q16 Cosan Raízen Cosan S/A Cosan S/A BRL mln Comgás Moove Elimin. Cosan S/A Elimin Chg.% Corporate Combined Pro forma Pro forma EBITDA (53.5) (256.4) , % Noncash impacts on EBITDA (296.8) 53.5 (225.3) (105.7) n/a Changes in assets and liabilities (54.7) (115.5) (21.7) (1.5) % Operating financial result n/a Operating Cash Flow (64.9) (21.7) , , , % CAPEX (68.7) (1.7) (0.3) - (70.8) (444.9) - (645.0) (590.5) 9.2% Other - - (275.8) - (275.8) (256.8) 14.8 n/a Cash Flow from Investing Activities (68.7) (1.7) (276.1) - (346.5) (438.9) - (901.8) (575.7) 56.7% Funding n/a Loans amortization (Principal) (118.0) (42.6) (76.1) - (236.7) (1,358.9) - (1,597.5) (966.9) 65.2% Loans amortization (Interest) (35.9) (1.0) (136.9) - (173.8) (45.9) - (224.1) (282.0) -20.5% Derivatives 4.3 (11.9) (160.4) - (167.9) - - (167.9) (12.4) n/a Other - (9.2) (1.9) n/a Cash Flow from Financing Activities (140.6) (64.6) (261.5) - (466.7) (525.1) - (1,115.2) (896.7) 24.4% Dividends received (246.7) (279.9) n/a Free Cash Flow to Equity (131.3) (268.4) (93.6) (279.9) % Cosan S/A % Comgás (421.6) (153.2) - - (153.2) (1,202.8) -87.3% Raízen (132.5) - (300.1) (250.4) 19.8% Dividends paid (421.6) (153.2) (132.5) (173.4) (761.1) -77.2% Exchange variation impact on cash and cash equivalents - (1.1) (8.6) - (9.7) (6.0) - (16.2) (58.9) -72.5% Cash Generation (Burn) in the Period (298.4) (132.4) (256.5) (51.1) (210.7) -75.7% Cash Flow Statement BRL mln Raízen Energia Raízen Combustíveis Operating Cash Flow 1, Cash Flow from Investing Activities (438.9) (116.4) Cash Flow from Financing Activities (525.1) (123.4) Free Cash Flow to Equity de 24

15 G. Guidance This section presents the 2017 guidance for each of the key parameters of Cosan s consolidated results, besides ratifying the guidance for Raízen Energia 2017/18 crop year. 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 proforma 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. Cosan S/A Consolidated Raízen Combustíveis Comgás Actual Guidance (Jan-Dec) (Jan-Dec) Pro forma Net Revenue (BRL mln) 47,008 45,000 48,000 Pro forma EBITDA¹⁵ (BRL mln) 4,503 4,750 5,250 EBITDA¹⁵ (BRL mln) 2,812 2,700 3,000 CAPEX (BRL mln) ,000 Total Volume Sold, excluding Thermo ('000 cbm) 4,119 4,000 4,300 Normalized EBITDA¹⁶ (BRL mln) 7,465 1,550 1,650 CAPEX (BRL mln) Moove EBITDA (BRL mln) Raízen Energia Actual Guidance Crop Year 2016/17 Crop Year 2017/18 (Apr/16-Mar/17) (Apr/17-Mar/18) Volume of Sugarcane Crushed ('000 tons) 59,391 59,000 63,000 Volume of Sugar Produced ('000 tons) 4,227 4,300 4,700 Volume of Ethanol Produced (million liters) 1,990 2,000 2,300 Volume of Energy Sold ('000 of MWh) 2,802 2,000 2,200 EBITDA¹⁵ (BRL mln) 3,078 3,900 4,300 CAPEX (BRL mln) 2,088 2,100 2,400 Note 15: Cosan S/A Cpnsolidated Proforma EBITDA considers in both actual 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. Nota 16: Comgás IFRS EBITDA for 2017 will be between R$1.150 million and R$1.250 million. 15 de 24

16 H. Other Information Distribution of Dividends On April 27, 2017, Cosan announced the distribution of dividends in the total amount of R$380 million, corresponding to R$ per common share, excluding withholding income tax. Payment will be made on May 11, 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. 16 de 24

17 I. Financial Statements I.1 Cosan S/A Consolidated Accounting Indicators 1Q17 1Q16 Chg.% 4Q16 Chg.% EBITDA % % CAPEX % % Income Statement for the Period 1Q17 1Q16 Chg.% 4Q16 Chg.% Net Revenue 1, , % 1, % Cost of Goods and Services Sold (1,035.2) (1,201.1) -13.8% (1,173.4) -11.8% Gross profit % % Selling, general & administrative expenses (392.1) (372.6) 5.2% (429.0) -8.6% Other net operating income (expenses) (13.8) (39.6) -65.1% (35.6) -61.1% Financial results (135.0) (455.7) -70.4% (289.6) -53.4% Equity Pick-up % % Expenses with income and social contribution taxes (37.3) 9.9 n/a 13.0 n/a Non-controlling interest (31.2) (84.3) -63.0% (49.1) -36.5% Net Income (Loss) % % Balance Sheet 1Q17 4Q16 BRL mln 03/31/ /31/2016 Cash and cash equivalents 3,725 3,991 Marketable Securities Trade accounts receivable Inventories Derivative financial instruments Other current assets Other non-current assets 1,787 1,802 Investments 8,979 8,746 Property, plant and equipment Intangible assets 9,250 9,328 Total Assets 27,054 27,300 Loans and borrowings 8,862 9,138 Financial instruments and derivatives Trade accounts payable 1,427 1,468 Payroll Other current liabilities Other non-current liabilities 4,826 4,835 Shareholders' Equity 11,100 10,792 Total Liabilities 27,054 27, de 24

18 I.2 Raízen Combustiveis Sales Volumes 1Q17 1Q16 Chg.% 4Q16 Chg.% 000 cbm (Jan-Mar) (Jan-Mar) 1Q17/1Q16 (Oct-Dec) 1Q17/4Q16 Total Volume 6,115 6, % 6, % Ethanol % % Gasoline 2,376 2, % 2, % Diesel 2,625 2, % 2, % Aviation % % Other % % Otto cycle 2,900 2, % 3, % Gasoline Equivalent 2,755 2, % 2, % Indicators 1Q17 1Q16 Chg.% 4Q16 Chg.% EBITDA % 1, % Adjusted EBITDA % % Adjusted EBITDA Margin (BRL/cbm) % % EBIT % % Adjusted EBIT % % Rebate % % CAPEX % % Income Statement for the Period 1Q17 1Q16 Chg.% 4Q16 Chg.% Net Operating Revenue 17, , % 17, % Ethanol 1, , % 1, % Gasoline 8, , % 8, % Diesel 7, , % 7, % Aviation % % Other % % Cost of Goods and Services Sold (16,746.9) (15,600.6) 7.3% (16,812.5) -0.4% Gross profit % 1, % Total Expences (430.3) (458.3) -6.1% (461.6) -6.8% Selling expenses (314.1) (357.1) -12.0% (338.1) -7.1% General and administrative expenses (116.2) (101.2) 14.9% (123.5) -5.9% Other operating income (expenses) (45.8) 80.7 n/a n/a Financial results (172.1) (133.0) 29.4% (158.3) 8.8% Equity Pick-up % - n/a Expenses with income and social contribution taxes taxes (89.4) (110.0) -18.7% (230.1) -61.1% Non-controlling interest (13.7) (10.1) 36.1% (21.2) -35.3% Net Income % % Balance Sheet 1Q17 4Q16 BRL mln 03/31/ /31/2016 Cash and cash equivalents Trade accounts receivable 1,531 2,151 Inventories 1,695 2,109 Derivative financial instruments Other current assets 1,262 1,456 Other non-current assets 1,442 1,457 Property, plant and equipment 2,374 2,379 Intangible assets 4,562 4,532 Total Assets 13,439 15,021 Loans and borrowings 1,007 1,044 Financial instruments and derivatives Trade accounts payable 1,058 1,920 Payroll Other current liabilities 1,619 1,473 Other non-current liabilities 4,155 4,714 Shareholders' Equity 5,031 5,129 Total Liabilities 13,439 15, de 24

19 I.3 Raízen Energia Indicators 1Q17 1Q16 Chg.% 2016/ /16 Chg.% (Jan-Mar) (Jan-Mar) 1Q17/1Q16 (Apr-Mar) (Apr-Mar) 16/17 / 15/16 Sugarcane Crushed - 2,777 n/a 59,391 62, % Sugarcane Crushed, Own ('000 t) - 1,999 n/a 29,337 30, % Sugarcane Crushed, Suppliers ('000 t) n/a 30,055 31, % Sugarcane TRS (kg/t) n/a % TCH (tons of cane per hectare) n/a % TRS/ha (tons of TRS per hectare) n/a % Mechanization (%) 97.8% 97.8% 0.0 p.p. 98.2% 97.6% 0.6 p.p. Sugar Produced ('000 ton) n/a 4,227 4,200 n/a Ethanol Produced ('000 cbm) - 81 n/a 1,990 2,149 n/a Sugar Sold ('000 ton) 1,076 1, % 4,271 4, % Ethanol Sold ('000 cbm) 823 1, % 3,416 3, % Energy cogeneration ('000 MWh) % 2,802 2, % EBITDA , % 3, , % Adjusted EBITDA , % 3, , % Adjusted EBITDA Margin (BRL/cbm) 25.8% 30.2% -4.4 p.p. 25.3% 29.1% -3.8 p.p EBIT % 1, , % Adjusted EBIT % 1, , % CAPEX % 2, , % Income Statement for the Period 1Q17 1Q16 Chg.% 2016/ /16 Chg.% BRL mln (Jan-Mar) (Jan-Mar) 1Q17/1Q16 (Apr-Mar) (Apr-Mar) 16/17 / 15/16 Net Operating Revenue 2, , % 12, , % Sugar 1, , % 5, , % Ethanol 1, , % 6, , % Energy Cogeneration % % Other Products and Services % % Cost of goods sold (2,232.1) (2,667.1) -16.3% (9,532.6) (9,231.0) 3.3% Sugar (965.3) (1,303.2) -25.9% (3,668.2) (3,495.2) 4.9% Ethanol (599.9) (992.0) -39.5% (2,872.9) (2,786.1) 3.1% Resale & Trading (790.7) (662.8) 19.3% (2,713.4) (2,741.1) -1.0% Energy Cogeneration (21.3) (21.1) 0.9% (213.4) (271.3) -21.3% Other % (64.8) 62.6 n/a Gross profit , % 2, , % Total Expences (303.1) (351.7) -13.8% (1,251.5) (1,197.7) 4.5% Selling expenses (144.3) (188.4) -23.4% (688.6) (656.2) 4.9% General and administrative expenses (158.8) (163.3) -2.8% (562.9) (541.5) 4.0% Other operating income (expenses) (85.3) 68.5 n/a (169.0) 10.2 n/a Financial results % (177.2) n/a Equity Pick-up (37.3) (36.3) 2.7% (69.6) (73.3) -4.9% Expenses with income and social contribution taxes (77.6) (368.6) -79.0% (367.8) (358.6) 2.6% Net Income % 1, % Balance Sheet 1Q17 4Q16 BRL mln 03/31/ /31/2016 Cash and cash equivalents 3,438 2,788 Marketable Securities Inventories 648 2,293 Derivative financial instruments 582 1,243 Biological Assets 1,276 1,120 Other current assets 1,471 1,911 Other non-current assets 4,410 4,683 Investments Property, plant and equipment 11,216 10,525 Intangible assets 3,234 3,224 Total Assets 26,892 28,864 Loans and borrowings 10,326 11,557 Financial instruments and derivatives Trade accounts payable 954 1,360 Payroll Other current liabilities 797 1,294 Other non-current liabilities 1,319 1,368 Shareholders' Equity 12,766 12,181 Total Liabilities 26,892 28, de 24