Report on the quarterly information review Quarter ended June 30,2015

Transcription

1 Report on the quarterly information review Quarter ended June 30,2015 (A free translation of the original report in Portuguese, prepared in accordance with the accounting practices adopted in Brazil and IFRS) KPDS

2 Review report on the quarterly information - ITR To The Board of Directors of Vigor Alimentos S.A. São Paulo - SP Introduction We have reviewed the individual and consolidated interim financial information of Vigor Alimentos S.A. ( ) contained within the Quarterly Information - ITR for the semester ended on June 30, 2015, which comprise the balance sheet on June 30, 2015 and the related statements of operations, comprehensive income for the three and six-month period then ended and changes in equity and cash flows for the six-month period then ended, including the notes to these interim financial information. Management is responsible for the preparation of the interim financial information in accordance with Technical Pronouncement CPC 21 (R1) - Interim Financial Reporting and with the International Accounting Standard (IAS) 34 - Interim Financial Reporting, issued by the International Accounting Standards Board (IASB), and for the presentation of these interim financial information in accordance with the standards issued by the Brazilian Securities and Exchange Commission (CVM) applicable to the Quarterly Information - ITR. Our responsibility is to express a conclusion on this interim financial information based on our review. Scope of the review We conducted our review in accordance with Brazilian and International Standard on Review of interim financial information (NBC TR 2410 and ISRE Review of Interim Financial Information Performed by the Independent Auditor of the Entity, respectively). A review of interim information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing and consequently does not enable us to obtain assurance that would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion. Conclusion on the interim financial information Based on our review, we are not aware of any fact that causes us to believe that the interim financial information included in the quarterly information referred to above were not prepared, in all material respects, in accordance with CPC 21 (R1) and IAS 34 applicable to Quarterly Information and presented in accordance with the standards issued by the Brazilian Securities and Exchange Commission. 2

3 Other issues Interim statement of value added We have also reviewed the individual and consolidated interim statement of value added for the six-month period ended June 30, 2015, prepared under the responsibility of the s management, whose disclosure in the interim financial statements is required in accordance with the standards issued by the Brazilian Securities and Exchange Commission (CVM) applicable to the preparation of the Quarterly Information and considered as supplemental information by the international accounting standards (IFRS), which do not require the disclosure of the Statement of Value Added. This statement was submitted to the same review procedures previously described and based on our review, we are not aware of any fact that would lead us to believe that they have not been fairly stated, in all material respects, in relation to the Individual and interim financial information taken as a whole. São Paulo, August 7, 2015 KPMG Auditores Independentes CRC 2SP014428/O-6 (Original report in Portuguese signed by) Orlando Octávio de Freitas Júnior Accountant CRC 1SP178871/O-4 3

4 Balance sheets Note June 30, 2015 December June 30, December June 30, Note 31, , December 31, 2014 June 30, 2015 December 31, 2014 ASSETS CURRENT ASSETS LIABILITIES CURRENT LIABILITIES Cash and cash equivalents Trade accounts payable Trade accounts receivable Loans and financings Inventories Debentures Recoverable taxes Payroll, social charges and tax obligation Prepaid expenses Dividends declared 20c Other current assets Income tax payable Other current liabilities TOTAL CURRENT ASSETS TOTAL CURRENT LIABILITIES NON-CURRENT ASSETS NON-CURRENT LIABILITIES LONG-TERM ASSETS Loan and financings Related parties transactions Debentures Judicial deposits and others Payroll, social charges and tax obligation Recoverable taxes Deferred income taxes Tax, labor and civel provision Other non-current liabilities TOTAL LONG-TERM ASSETS TOTAL NON-CURRENT LIABILITIES SHAREHOLDERS EQUITY 20 Investments in subsidiaries Capital Property, plant and equipment, net Earning reserve Intangible assets, net Cumulated translation adjustments Profit for the period NONCONTROLLING INTEREST TOTAL NON-CURRENT ASSETS TOTAL SHAREHOLDERS S EQUITY TOTAL ASSETS TOTAL LIABILITIES AND SHAREHOLDERS S EQUITY The accompanying notes are na integral part of the financial statements 1

5 Statements of income for the six months period ended June 30, 2015 and 2014 Note June 30, 2015 June 30, 2014 June 30, 2015 June 30, 2014 NET SALES Cost of goods sold 25 ( ) ( ) ( ) ( ) GROSS PROFIT OPERATING (EXPENSE) INCOME General and administrative 25 (77.341) (49.269) ( ) (81.426) Selling expenses 25 ( ) ( ) ( ) ( ) Equity in subsidiaries Other (expense) income, net (2.380) ( ) ( ) ( ) ( ) INCOME FROM OPERATION BEFORE FINANCIAL (EXPENSE) INCOME Financial income (expense), net 23 (52.968) (47.446) (65.797) (63.900) NET INCOME BEFORE INCOME TAX AND SOCIAL CONTRIBUTION Current income taxes (21.015) (19.999) Deferred income taxes 19 (47.118) (4.123) (46.521) (5.643) (47.118) (4.123) (67.536) (25.642) NET INCOME ATTRIBUTABLE TO: Controlling interest Noncontrolling interest Net Income (Basic) per share in reais in the end of the period 22 0,75 0,18 The accompanying notes are an integral part of the financial statements 2

6 Statements of income for the three months period ended June 30, 2015 and 2014 Note June 30, 2015 June 30, 2014 June 30, 2015 June 30, 2014 NET SALES Cost of goods sold 25 ( ) ( ) ( ) ( ) GROSS PROFIT OPERATING (EXPENSE) INCOME General and administrative 25 (39.772) (21.876) (57.221) (39.171) Selling expenses 25 ( ) (94.638) ( ) ( ) Equity in subsidiaries Other (expense) income, net (2.793) ( ) ( ) ( ) ( ) INCOME FROM OPERATION BEFORE FINANCIAL (EXPENSE) INCOME Financial income (expense), net 23 (27.384) (24.283) (33.888) (32.971) NET INCOME BEFORE INCOME TAX AND SOCIAL CONTRIBUTION Current income taxes (8.270) (7.992) Deferred income taxes (3.684) (5.508) (3.684) (2.349) (13.500) NET INCOME ATTRIBUTABLE TO: Controlling interest Noncontrolling interest Net Income (Basic) per share in reais in the end of the periods 22 0,15 0,09 The accompanying notes are an integral part of the financial statements 3

7 Statements of comprehensive income for the six months period ended June 30, 2015 and 2014 NET INCOME June 30, 2015 June 30, 2014 June 30, 2015 June 30, Total of comprehensive income (loss) Total of comprehensive income (loss) Controlling interest Noncontrolling interest The accompanying notes are an integral part of the financial statements 4

8 Statements of comprehensive income for the three months period ended June 30, 2015 and 2014 NET INCOME June 30, 2015 June 30, 2014 June 30, 2015 June 30, Total of comprehensive income (loss) Total of comprehensive income (loss) Controlling interest Noncontrolling interest The accompanying notes are an integral part of the financial statements 5

9 Statements of changes in shareholder s equity for the six months period ended June 30, 2015 and 2014 Profit reserve Capital stock Legal For expansion Cumulated translation adjustments Retained earnings Total Noncontrolling interest Shareholder s Equity BALANCE AS OF DECEMBER 31, Net income for the period Noncontrolling interest (14) (14) BALANCE AS OF JUNE 30, BALANCE AS OF DECEMBER 31, Net income for the period Capital Increase Capital to be Paid (391) (391) - (391) Dividends proposed (7.207) (7.207) Noncontrolling interest BALANCE AS OF JUNE 30, The accompanying notes are an integral part of the financial statements 6

10 Statements of cash flow for the six months period ended June 30, 2015 and 2014 June 30, 2015 June 30, 2014 June 30, 2015 June 30, 2014 Cash flow from operating activities Net income Adjustments to reconcile net income (loss) to cash provided by operations activities:. Depreciation and amortization Financial charges and exchange variation Allowance for doubtful accounts Noncontrolling interests Equity in earnings of subsidiaries (26.945) (25.210) - (2.289). Net value of property, plant and equipment written off Tax, labor and civel provision Deferred income taxes Gain on Investment ( ) - ( ) Decrease (increase) in assets Opening balance Dan Vigor Trade accounts receivable (20.757) (66.820) Inventories (15.010) (7.211) Recoverable taxes (14.977) (1.270) (17.352) Other current and non-current assets (1.592) (12.501) (7.724) (26.321) Related party receivable (343) (343) Prepaid expenses (23.853) (24.627) Judicial deposits and others (2.187) (9.548) Increase (decrease) in liabilities Trade accounts payable (8.951) Payroll, social charges and tax obligation (7.201) - (8.218) - Other current and non-current liabilities (1.451) Income tax and social contribution (18.873) Amounts due from related companies - - (1.330) - Net cash provided by operating activities Cash flow from investing activities Additions to property, plant and equipment and intangible assets (52.267) (20.190) ( ) (26.035) Additions to investment ( ) - (27.311) - Dividends received Net cash used in investing activities ( ) (20.190) ( ) (26.035) Cash flow from financing activities Payments of loans and financings ( ) (86.504) ( ) ( ) Interest rate paid and received - (11.783) - (28.165) Loans and financing obtained Payment of debentures (58.657) (42.148) (58.657) (42.148) Payments of dividends - - (11.423) (5.541) Capital Increase Fees related to isuue of securities Net cash used in financing activities ( ) ( ) Variance in cash and cash equivalents (2.298) ( ) (16.942) ( ) Cash and cash equivalents at the beginning of the period Cash and cash equivalents at the end of the period The accompanying notes are an integral part of the financial statements 7

11 Statement of value added for the six months period ended June 30, 2015 and 2014 June 30, 2015 June 30, 2014 June 30, 2015 June 30, 2014 Revenue Sales of goods and services Other income (85) (70) (1.598) (84) Allowance for doubtful accounts (4.000) (600) (4.579) (727) Inputs purchased from third parties Cost of services and goods sold ( ) ( ) ( ) ( ) Materials, energy, services from third parties and others ( ) ( ) ( ) ( ) Others costs - - (105) - ( ) ( ) ( ) ( ) Gross added value Depreciation and Amortization (13.629) (11.380) (30.302) (26.609) Net added value generated by the Net added value by transfer Equity in earnings of subsidiaries Financial income Other Net added value to distribution Distribution of added value Labor Salaries Benefits FGTS (Brazilian Social Charge) Taxes and contribution Federal State Municipal Capital Remuneration from third parties Interests Rents Others Owned capital remuneration Net income of the period Noncontrolling interest Added value distributed The accompanying notes are an integral part of the financial statements. 8

12 Notes to the financial statements for the for the six months period ended June 30, 2015 and Operating Activities Vigor Alimentos S.A () is a publicly-held company ruled by its Bylaws and by applicable legal provisions, the purpose of which is to manufacture and trade dairy productions in general, in natura milk and byproducts and also the refining, industrialization and trading of vegetable oil, instant noodles, juices and yogurt, besides holding interest as partner of other entities, with an indeterminate duration. The (Parent) The operates in the refrigerated product segment (whole, semi-skimmed and skimmed milk, yogurt drinks, smoothies, petit suisse cheese, fermented milk, probiotic drinks, desserts, Parmesan cheese, fine cheeses, cream cheese, fondue, creams, margarine, butter, mayonnaise, blends and oils and in the grocery product segment (chantilly spray, chocolate milk, juices and pastas), in eight manufacturing units across the States of Góias, Minas Gerais, Paraná and São Paulo. The Subsidiaries Itambé, a direct subsidiary, operates in two main segments: refrigerated products (such as the Parent) and grocery products (powered milk, condensed milk, caramel milk). Headquartered in Belo Horizonte, Minas Gerais State, Itambé has five manufacturing units, four of them in Minas Gerais State and one in Goiás State and eleven distribution center located in Minas Gerais, São Paulo, Rio de Janeiro, Pernambuco, Bahia, Ceará and Distrito Federal. The company s suppliers include 31 cooperatives in Minas Gerais and Goiás which represent approximately 8,000 milk producing families. Dan Vigor is responsible for selling high value added products of the premium brand Danubio and it shows significant growth potential for the coming years through products such as requeijão cheese spread, cream cheese, fine cheeses, cheese portions, fondue and other dairy products. On February 20, 2015, the Shareholders were informed of the Capital increase of one hundred and fifty-six million, six hundred and forty-nine thousand, three hundred and sixty-eight reais (R$156,649,368 ) with the issue of thirteen million, fifty-four thousand, one hundred and fourteen (13,054,114 ) new non-par, book-entry, registered common shares, totaling one billion, three hundred and forty-eight million, twenty-seven thousand, seven hundred and eighty reais (R$1,348,027,780) and one hundred and sixty-two million, seven hundred and sixty-eight, four hundred and sixty (162,768,460 ) shares. The potential percentage dilution resulting from this new issue is approximately eight percent (8%). The issue price will be twelve reais (R$12) per share. On June 30, 2015, the had the following direct participation on invested companies: Ownership Country DAN VIGOR IND.COM.LAT.LTDA Brazil 100% 50% ITAMBÉ ALIMENTOS S/A Brazil 50% 50% VIGOR LIMITED Ilhas Cayman 100% 100% 2 Elaboration and presentation of financial statements a. Declaration of conformity (in relation to IFRS and the standards of CPC) These individual and consolidated financial statements have been prepared in accordance with the International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board (IASB) and according with accounting practices adopted in Brazil issued by accordance Brazilian Accounting Pronouncements Committee (CPC). However, there is no difference between consolidated equity and profit and the parent company's equity and profit in its individual financial statements. As a result, the consolidated and parent company financial statements are presented side by side in a single set of financial statements. Review of Technical Pronouncements n. 07 (approved in December, 2014) changed the CPC 35, CPC 37 and CPC 38 and authorized the use of the equity of subsidiaries in financial statements IFRS, eliminating the difference between Brazilian GAAP and IFRS. The issue of the parent company and consolidated financial statements was authorized by the Board of Directors on August 07, b. Function and presentation currency The financial statements are presented in reais, the functional currency of the. All the financial information presented in reais were rounded-up or down to the closest decimal, except when otherwise mentioned. 3 Summary of significant accounting practices The main accounting practices used in the preparation of these financial statements, as described below, have been consistently applied all over the reported periods, unless otherwise stated. a) Statement of income Revenue and expenses are recorded on the accrual basis. Revenue is measured at the fair value of the payment received or receivable for sale of products and services normal course of business. In the statement of operations, the revenue is net of taxes, returns, rebates and discounts, as well as of intercompany sales, on Note 22 is presented net revenue reconciliation. Revenue is recognized when the risks and rewards of ownership have been transferred to the buyer. According to IAS 18/CPC 30 - Revenues, the recognizes revenue when, and only when: (i) the amount of revenue can be measured reliably; (ii) the entity has transferred to the buyer the significant risks and rewards incidental to ownership over the goods; (iii) it is probable that the economic benefits will flow to the and its subsidiary; (iv) Entity neither maintain involvement in the management of product sold at levels normally associated with ownership nor effective control of such cost of good sold. (v) expenses incurred or to be incurred related to the transaction, can be reliably measured. The expenses are recorded on the accrual basis. b) Accounting estimates The preparation of these individual and consolidated financial statements requires Management to make judgments, estimates and assumptions that affect the application of the Group s accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates. Estimates and assumptions are reviewed on a periodic basis. The reviewed estimates are recognized prospectively. impairment of non-financial assets; loss on the reduction of recoverable value of taxes; fair value of financial instruments; provision for tax, civil and labor risks; estimated losses on doubtful receivables; useful lives of property, plant and equipment. Uncertainties on assumptions and estimates The information on uncertainties on assumptions and estimates that have a significant risk of resulting in a material adjustment in the year ending June 30, 2015 is included in the following notes: Note 7 Allowance for doubtful accounts Note 8 Provision for inventory losses Note 12 Analysis of the useful life of property, plant and equipment Note 18 Provision for risks c) Cash and cash equivalents Cash and cash equivalents comprise the balances of cash, banks and financial investments with original maturity of three months or less as of the contract date. Financial investments are highly liquid, readily convertible into a known amount of cash and subject to an insignificant risk of changes in value, in accordance with IAS 7/CPC 03 R2 - Statement of Cash Flows. These investments aim to meet short-term cash commitments (daily management of the financial resources of the and its subsidiaries) and are not for investments or other purposes. 9

13 Notes to the financial statements for the for the six months period ended June 30, 2015 and 2014 d) Trade accounts receivable Trade accounts receivable correspond to amounts owed by customers in the ordinary course of business of the. If the due date is equivalent to one year or less, the account receivable is classified as current assets. Otherwise, the corresponding amount is classified as noncurrent assets. e) Allowance for doubtful accounts Allowance for doubtful accounts is calculated based on the analysis of the aging list, for the items of long standing, and considering the probable estimated losses, which the amount is considered sufficient by the Management of the company to cover probable losses on accounts receivable. Bad debits expenses were recorded under the caption "Selling Expenses" in the statement of operations. When no additional recovery is expected, the allowance for doubtful accounts is usually reversed against the definitive write-off of the account receivable. f) Inventories In accordance with the requirements of IAS 2/CPC 16 - Inventories, the inventories are stated at the lower of the average cost of acquisition or production, and the net realizable value. The cost of inventories is recognized in statement of operations when inventories are sold. g) Investments in associates, subsidiaries and joint ventures In the 's interim financial information, interests in associates, subsidiaries and joint ventures are recognized using the equity accounting method. As defined in IAS 28/CPC 18 R2- Investments in Associates, Subsidiaries and Joint Ventures, Associates are those entities in which the has a significant influence and are not defined as subsidiaries or joint ventures. In accordance with the requirements of IAS 31/CPC 19 R2 - Interests in Joint Ventures, Joint venture is a jointly controlled business in which the parties sharing control have rights over the business' net assets. Interests in joint ventures are treated as investments and recorded using the equity accounting method, pursuant to IAS28/CPC 18 R2 - Investments in Associates, Subsidiaries and Joint Ventures. Exchange differences on foreign currency investments are recognized in equity in the accumulated translation adjustments. h) Property, plant and equipment (i) Recognition and measurement A property, plant and equipment item is written-off when sold or when no future economic benefit is expected from its use or sale. Eventual gains or losses resulting from the write-off of an asset (calculated as the difference between its net sale amount and its carrying amount) are included in the statement of income, in the period the asset is written-off. The residual value, useful life of assets and depreciation methods are reviewed at the end of each year, and adjusted prospectively, where applicable. (ii) Depreciation The maximum estimated useful lives of property, plant and equipment are as follows: - Buildings 30 years - Machinery and equipment - Facilities - IT equipment - Vehicles - Others i) Intangible assets Current taxes 10 years 10 years 3 years 5 years 10 years Intangible assets are stated at acquisition cost, less amortization. Intangible assets with indefinite useful lives are not amortized but tested for impairment annually. Impairment losses Property, plant and equipment, intangible assets with defined useful life and other assets (current and noncurrent) are tested for impairment, if indications of potential impairment exist. Intangible assets with indefinite lives useful are tested for impairment when an indication of potential impairment exists or on an annual basis, regardless of whether or not there is any indication of impairment, pursuant to IAS 38/CPC 4 - Intangible Assets. After each year end a review is made of the book value of tangible and intangible assets to determine whether there is some indication that those assets have suffered any impairment. If such indication is indentified, the recoverable amount of the asset is estimated in order to measure the amount of such loss, if any. The recoverable amount is the higher amount between fair value less costs to sell and value in use. In evaluation of value in use, the estimated future cash flows are discounted to present value by the discount rate before tax that reflects current market assessment of the time value of money and the specific risks to the asset. If the recoverable amount of an asset is lower than its carrying value, the asset is reduced to its recoverable amount. The loss on the impairment is recognized immediately in the statement of operations and is reversed if there has been a change in the estimates used to determine the recoverable amount. When an impairment loss is subsequently reversed, there is an increase in amount of the asset due to the revised estimate of its recoverable amount, but it does not exceed carrying amount that would have been determined if no loss on the impairment had been recognized for the asset in prior periods. Reversal of loss on the impairment is recognized directly in the income statement. j) Other current and noncurrent assets Other current and noncurrent assets are stated at cost or realizable value including, if applicable, income earned through the balance sheet date. k) Trade accounts payable Correspond to the amounts owed to suppliers in the ordinary course of business of the controlled Vigor. If the payment period is equivalent to one year or less, suppliers are classified as current liabilities. Otherwise, the corresponding amount is classified as noncurrent liabilities. When applicable, are added interest and monetary or exchange variation. l) Income tax and social contribution Current taxes are computed based on taxable income at tax rates in effect, according to prevailing legislation. Deferred taxes Income tax and social contribution (deferred tax) are calculated on the revaluation reserves, goodwill tax-shield, and on the temporary differences between the tax bases of assets and liabilities and their carrying amounts. Deferred tax is determined using tax rates enacted and expected to be applied when the deferred tax assets are realized or when the income tax and social contribution tax liabilities are settled. Deferred tax assets are recognized only in proportion to the expectation or likelihood that future taxable income will be available against which the temporary differences, tax losses and tax credits can be used. Deferred tax assets and liabilities are offset if there is a legal right to offset current tax assets and liabilities, and they are related to income taxes levied by the same taxation authority on the same taxable entity. m) Current and noncurrent liabilities Current and noncurrent liabilities are stated at known or estimated amounts, including, if applicable, charges and monetary or exchange rate variations. n) Contingent assets and liabilities In accordance with IAS 37/CPC 25 - IAS 37 Provisions, Contingent Liabilities and Contingent Assets, the contingent assets are recognized only when their realization is virtually certain, based on favorable final judicial decision. Contingent assets are disclosed where an inflow of economic benefits is probable. Contingent assets classified as likely success are only disclosed. Contingent liabilities are accrued when losses are probable and the amounts can be estimated reliably. Contingent liabilities classified as possible are only disclosed and contingent liabilities classified as remote are neither accrued nor disclosed. 10

14 Notes to the financial statements for the for the six months period ended June 30, 2015 and 2014 o) Loans and financing Loans and financing are initially recognized at fair value, net of transaction costs, and subsequently re-measured to amortized cost, which are the costs plus charges, interest and monetary and exchange variations established in contracts and incurred through the balance sheet date, as stated in Note 16. p) Present value of assets and liabilities Short and long-term financial assets and liabilities are adjusted for their present value, however, adjustments to short-term balances occur when the effect is deemed relevant vis-a-vis the financial statement. The calculation of the adjustment to present value considered the following assumptions: (i) the amount to be discounted; (ii) liquidation dates; and (iii) discount rates. Discount rates used by the considered the current market standards regarding the time value of money and embedded risks of each asset and liabilities. q) Consolidation The adopts the CPC 36 (IFRS 10) - Financial Statements and CPC 45 (IFRS 12) - Disclosure of Interest in Other Entities, in the consolidation process. The consolidated financial statements include the financial statements of the and its subsidiary. The control is obtained when the has the power to control the financial and operational policies of an investee to reap the benefits of its activities, as well as the exposure to/or right over variable returns deriving from involvement with investee. When necessary, the financial statements of subsidiaries are adjusted according to the accounting policies established by the. All transactions, balances, income and expenses between the and its subsidiaries are eliminated in the consolidated financial statements. The financial statements of the foreign wholly owned subsidiary, Vigor Limited, are originally prepared in the currency of the country in which they are located and, subsequently, are converted into IFRS and Reais using the exchange rate in effect at the balance sheet date for assets and liabilities, the historical exchange rate for changes in equity and the average exchange rate for the period of income and expenses when it is appropriate. Gains and losses arising from changes in shareholders' equity and recognition of income and expenses by the average exchange rate are recognized in equity under the caption "accumulated translation adjustments" in accordance with IAS 21/CPC 2 - The effects of changes in foreign exchange rates. r) Foreign currency translation Function and presentation currency Transactions in foreign currencies are translated to the respective functional currencies of the subsidiary entities at exchange rates at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies at the reporting date are retranslated to the functional currency at the exchange rate at that date. The foreign currency gain or loss on monetary items is the difference between amortized cost in the functional currency at the beginning of the period, adjusted for effective interest and payments during the period, and the amortized cost in foreign currency translated at the exchange rate at the end of the reporting period. The items of the financial statements of the subsidiary are measured using the currency of the primary economic environment in which the its subsidiary operate ("functional currency"), being translated to Brazilian Real at the corresponding exchange rate of the reporting period for assets and liabilities, the historical rate for equity and the exchange rate at date of the relevant transactions, when it is appropriate we use the average exchange rate of the period of the period for the income statement. With the exchange rate effects recognized in other comprehensive income within equity. s) Earning per share According to with IAS 33/CPC 41 - Earnings per share, the presents the basic and diluted earnings per share data for its common shares: Basic: Calculated by dividing net income allocated to common shareholders of the by the weighted average number of common shares outstanding during the period. Diluted: Calculated by dividing net income attributable to common shareholders of the by the weighted average number of common shares outstanding during the period, adjusted for the effects of all dilutive potential common shares in common shares, adjusted for own shares held. t) Financial instruments Subsequent measurement of financial instruments occurs at each balance sheet date, according to the rules for each category of financial assets and liabilities. Financial assets at fair value through profit or loss Financial asset are classified by its fair value on the financial report if it is classified as held for trading or designated as such upon initial recognition. Financial assets are designated at fair value through profit or loss if the company manages such investments and makes purchase and sale decisions based on their fair values in accordance with a documented risk management and investment strategy of the. Transaction costs, after initial recognition are recognized in statement of operations as incurred. Financial assets recorded at fair value through profit or loss are measured at fair value and changes in fair value of these assets are recognized in statement of operations of the period. Loans and receivables Loans and receivables are financial assets with fixed or estimated payment amounts that are not quoted in an active market. Such assets are initially recognized at fair value plus any attributable transaction costs. After initial recognition, loans and receivables are measured at amortized cost using the effective interest method, decreased by any loss on the impairment. The main assets of the classified in this category are "trade accounts receivables" and "related parties". Held to maturity In the case when the intends and is able to hold bonds to maturity, then such financial assets are classified as held to maturity. Investments held to maturity are initially recognized at fair value plus any directly attributable transaction costs. After initial recognition, investments held to maturity are measured at amortized cost using the effective interest method, decreased by any loss on the impairment. The has no financial instruments in this category. Non derivative financial liabilities The recognizes debt securities and subordinated debt on the date on which they originated. All other financial liabilities (including liabilities designated at fair value recorded in income) are initially recognized on the trade date on which the becomes a party to the contractual provisions of the instrument. The derecognizes a financial liability when its contractual obligations canceled or expired. The has the following non-derivative financial liabilities: loans, financing, trade accounts payable and other payables. Impairment of financial assets Financial assets, except those designated at fair value through profit or loss, are assessed for indicators of impairment at the end of each reporting period. Impairment loss is recognized if, and only if there is any indication that an asset may be impaired as a result of one or more events that occurred after initial recognition, and had an impact on the future cash flows estimated of this asset. The financial asset carrying value is reduced directly by the loss of the impairment for all financial assets, except accounts receivable in which the carrying value is reduced by provision. Subsequent recoveries of amounts previously written off are credited to the provision. Changes in the carrying value of the provision are recognized in statement of operations. Derivatives The and subsidiaries recognize and disclose financial instruments and derivatives according to IAS 39/CPC 38 - Financial Instruments: Recognition and Measurement, IFRIC 9 - Assessment of embedded derivatives and IFRS 7/CPC 40 - Disclosure of Financial Instruments. The financial instruments are recognized after the and its subsidiaries become a party to the contractual provisions at the instruments. u) Business combination In accordance with IFRS 3 (R)/CPC 15 R1 - Business Combinations, business acquisitions are accounted for using the acquisition method. Consideration transferred in a business combination is measured at fair value, which is the sum of the fair values of the transferred assets, the liabilities incurred by the former owners of the acquired company on the acquisition date and interests issued in exchange for the acquired company s control. Costs related to the acquisition are usually recognized in profit or loss, when incurred. Goodwill is measured as the surplus of the sum of the consideration transferred, the non-controlling interest in the acquired company and the fair value of the acquirer's former interest in the acquired company (if any) over the net amounts of the identifiable assets acquired and liabilities assumed on the date of acquisition. If, after the evaluation, the net amounts of the identifiable assets acquired and liabilities assumed on the date of acquisition are higher than the sum of the consideration transferred, the non-controlling interests in the acquired company and the fair value of the acquirer's former interest in the acquired company, the surplus is immediately recognized in profit or loss as a gain. If the initial calculation of a business combination is incomplete at the end of the reporting period when the combination occurred, a provisional amount is recorded for the items whose calculation is incomplete. These provisional amounts are adjusted during the measurement period (which cannot be longer than one year as of the date of acquisition), or additional assets and liabilities are recognized to reflect new information obtained in relation to facts and circumstances existing on the date of acquisition which, if recognized, would have affected the amounts then recognized. 11

15 Notes to the financial statements for the for the six months period ended June 30, 2015 and 2014 v) Segment reporting In accordance with IFRS 8/CPC 22 - Segment reporting - Segment reporting is presented consistently with the internal reports provided to the entity's chief operating decision maker to make decisions about resources allocations, performance evaluation by segment and strategic decision making process. 4 x) Statement of value added The prepared parent company and consolidated statements of value added (SVA) in accordance technical pronouncement CPC 09 - Statement of Value Added, which are disclosed as an integral part of the financial statements under BRGAAP applicable to publicly-held companies, and considered as additional information under IFRS. New standards and interpretations not yet adopted IFRS 9, published in July 2014, replaces the guidelines in IAS 39 Financial Instruments: Recognition and Measurement. IFRS 9 includes revised guidance on the classification and measurement of financial instruments, including a new model for expected loan losses in the calculation of impairment of financial assets, and new requirements for hedge accounting. The standard maintains the existing guidelines for recognition and derecognition of financial instruments in IAS 39. IFRS 9 is effective for fiscal years beginning on or after January 1, 2018, early adoption being allowed. IFRS 15 requires companies to recognize revenue reflecting the consideration they expect to receive in exchange from control of these goods and services. When the new standard is adopted, it will replace most of the existing detailed guidelines in IFRS and U.S. GAAP for revenue recognition. The new standard is applicable as of or after January 1, 2017, early adoption being allowed by IFRS. The standard can be retrospectively adopted, using a cumulative approach. The is evaluating the effects IFRS 15 will have on the financial statements and its disclosures. The has not yet chosen the transition method to the new standard, nor has it ascertained the new standard's effects on the current financial reports. In addition, we do not expect the following new standards or changes to have a material impact on the Group's consolidated financial statements. IFRS 14 - Regulatory Deferral Accounts Accounting for Acquisitions of Interests in Joint Operations(amendment to IFRS 11) Clarification of Acceptable Methods of Depreciation and Amortization (amendments to IAS 16 and IAS 38) Defined Benefit Plans: Employee Contributions (amendment to IAS 19) Annual IFRS Improvements Annual IFRS Improvements The Brazilian Accounting Pronouncements Committee has not yet issued accounting pronouncements or changes to effective accounting pronouncements corresponding to these standards. Early adoption is not allowed. 5 Business combination Aquisição da Dan Vigor Indústria e Comércio de Laticínios Ltda In February, 2015 the s shareholders attending the Extraordinary Shareholders Meeting ratified the acquisition of fifty percent (50%) of the shares of DanVigor Indústria e Comércio de Laticínios Ltda. ("Dan Vigor") by the, in accordance with the Material Fact released on September 18, 2014 ("Transaction") The Transaction reinforces the s strategy of expansion and consolidation in Brazil s main consumer regions, through high value-added products with attractive margins. Dan Vigor is responsible for selling high value added products of the premium brand Danubio and it shows significant growth potential for the coming years through products such as requeijão cheese spread, cream cheese, fine cheeses, cheese portions, fondue and other dairy products The Transaction will open up for the exchange of technology and know-how between the partners Arla and Vigor, contributing to a more significant evolution of the innovation process and a focus on the development of new products, as well as a more effective management of the brand and investments. The Transaction will also establish an exclusivity agreement for the in the distribution of Arla products in Brazil, which includes the renowned brands Lurpak, Castello and Arla. After allocations, goodwill was recorded as goodwill from expected future profitability for accounting purposes. As such, it is not amortizable and is subject to annual impairment testing. Goodwill recognized may be treated as provided for in relevant legislation (Decree 3000 of 1999, Article 396). Dan Vigor financial results, date December 31, 2014, are presented below. Results does not consider potential adjustment for fair value of assets identified after the investment. RESULTADO December 31, 2014 Net sales Cost of goods sold (91.975) GROSS PROFIT General, administrative and selling expenses (11.586) Financial income (expense), net Income taxes 941 (5.456) NET INCOME OF THE YEAR At February 28, 2015, the appraisal of assets and liabilities for purposes of compliance with CPC 15 Business Combinations was completed. The respective Appraisal Report issued by an independent firm determined the following values: Identifiable assets acquired and liabilities assumed The table below summarizes the amounts of assets acquired and liabilities assumed at the acquisition date. Fair Value of Assets Cash and equivalent Accounts receivable Inventory Recoverable taxes Other Assets Fixed assets Intangible assets Deferred income taxes Accounts payable (9.559) Other Liabilities (4.516) Total net identified assets Fair value measurement The valuation techniques used to measure the fair value of the material assets acquired were as follows: Assets acquired Valuation techniques Property, plant and equipment Intangible assets Market comparison technique and cost technique: This valuation model considers the market prices quoted for similar items, when available, and depreciated replacement cost, when appropriate. The depreciated replacement cost reflects physical deterioration adjustments as well as the functional and economic obsolescence. The valuation approach considers payments of discounted estimated royalties that should be avoided as a result of the acquisition of trademarks. 12

16 Notes to the financial statements for the for the six months period ended June 30, 2015 and 2014 Goodwill allocation Investment Fair value of non-controlling shareholders Net fair value of identified assets ( ) Goodwill After allocations, goodwill was recorded as goodwill from expected future profitability for accounting purposes. As such, it is not amortizable and is subject to annual impairment testing. Goodwill recognized may be treated as provided for in relevant legislation (Decree 3000 of 1999, Article 396). Shareholders Equity Dan Vigor (100%) Business Value (50%) Gain on Investment (50%) Goodwill Trademarks Goodwill Arla Foods Vigor Total 50% 50% 100% Business Value As mentioned in note 20, the subscribed 13,054,114 shares at a price of R $ 12.00, totaling R $ 156,649 in favor of Arla Foods International A / S, as consideration for the acquisition of Dan Vigor. Arla now has equity interest at 8% in the s capital stock. As defined in CPC 15, paragraph 42," " business combination achieved in stages ", " we are again measuring our fair value of the non-controlling shareholders in the acquiree at fair value at the acquisition date above mentioned February 20, 2015, which resulted in goodwill of R$ , recorded in the investment account ( note 11 ) and other operating income ( note 24 ). The taxes were recorded under income tax and social contribution in noncurrent liabilities and results for the quarter, note 19, in the amount of R$ Cash and cash equivalents Cash, bank accounts and short-term investments are the items of the balance sheet presented in the statements of the cash flows as cash and cash equivalents and are described as below: June 30, 2015 December 31, 2014 June 30, 2015 December 31, 2014 Cash and bank deposits CDB-DI (bank certificates of deposit) Trade accounts receivable, net CDB-DI (bank certificates of deposit) are held by financial institutions, with floating-rate and yield an average of 100,2% and 101,5% of the variation of the interbank deposit certificate (Certificado de Depósito Interbancário - CDI). June 30, 2015 December 31, 2014 June 30, 2015 December 31, 2014 Receivables not yet due Overdue receivables: From 1 to 30 days From 31 to 60 days From 61 to 90 days Above 90 days Allowance for doubtful accounts (7.773) (4.989) (11.177) (7.811) According with IFRS 7/39 Financial Instruments, follow the changes in the allowance for doubtful accounts: June 30, 2015 December 31, 2014 June 30, 2015 December 31, 2014 Initial balance (4.989) (6.257) (7.811) (8.742) (Additions) Reversal (4.000) (633) (4.579) (970) Disposals Ending Balance (7.773) (4.989) (11.177) (7.811) 8 Inventories June 30, 2015 December 31, 2014 June 30, 2015 December 31, 2014 Finished products Work in process Raw materials Warehouse spare parts Losses - - (2.802) (3.301)

17 Notes to the financial statements for the for the six months period ended June 30, 2015 and Recoverable taxes June 30, 2015 December 31, 2014 June 30, 2015 December 31, 2014 Value-added tax on sales and services (ICMS) Excise tax - IPI PIS and COFINS Income tax withheld at source - IRRF Other Current Non-current Value-added tax on sales and services (ICMS) Recoverable ICMS refers to excess of credits derived from purchases of raw materials, packaging and other materials over tax charges due on domestic sales, specifically in the unit based in the city of Santo Inácio - PR. To offset these credits, the controlled Vigor signed an agreement with suppliers for non-use of the credit of ICMS based on local laws, through the ICMS exemption on purchases of packaging. PIS and COFINS (social contribution on net income) Refers to non-cumulative PIS and COFINS credits arising from purchases of raw materials, packaging and other materials used in the products sold in the foreign market. The company has honed credit balance of such taxes due to tax rate to zero in some lines of products such as milk, yogurt, cheeses and margarines under the provisions introduced by Law No /05, No /07 and decret ("medida provisória") 609. Since August 2011, the is compensating these credits against other taxes due (withholding income tax and social contribution, income tax and social contribution) and is in the process of application for approval for reimbursement of the total balance of credits. IRPJ/CSSL/IRRF (withholding income tax) Refers to withholding income tax levied on financial investments, tax losses and negative basis of social contribution which can be offset against income tax payable on profits. 10 Related parties transactions Trade accounts receivable between related parties recorded in the balance sheet as receivables and debts with related parties: Currency Maturity June 30, 2015 December 31, 2014 Dan Vigor Ind. Com. Lat. Ltda. R$ August 10, Trade accounts receivable and trade accounts payable between related parties recorded on the statement of financial position of the : Financial revenue June 30, 2015 Trade accounts receivable Trade accounts payable Trade accounts receivable December 31, 2014 Trade accounts payable Itambé Alimentos S.A. - - (33.338) - (167) JBS S.A (7.472) (2.616) Banco Original S.A Seara Alimentos Ltda (16) (38) Dan Vigor Ind. Com. Lat. Ltda (20.082) 81 (19.465) Com. E Ind. De Massas Alim. Massa Leve Ltda (60.908) (22.286) Financial revenue June 30, 2015 Trade accounts receivable Trade accounts payable Trade accounts receivable December 31, 2014 Trade accounts payable JBS S.A (7.861) (2.616) Banco Original S.A Seara Alimentos Ltda (16) (38) Dan Vigor Ind. Com. Lat. Ltda (19.465) Com. E Ind. De Massas Alim. Massa Leve Ltda (7.877) (22.119) Impacts of related party transactions on Income Statements: Financial Income, Sales of products and Purchases. For the six months period ended June 30, 2015 For the six months period ended June 30, 2015 Purchases Sales of products Financial revenue Purchases Sales of products Financial revenue Banco Original S.A. - - (6.612) Dan Vigor Ind. Com. Lat. Ltda. (74.784) (62.084) 40 - Itambé Alimentos S.A. (39.126) JBS S.A. (33.331) (38.351) Seara Alimentos Ltda. (586) Com. E Ind. De Massas Alim. Massa Leve Ltda ( ) (6.612) ( ) For the three months period ended June 30, 2015 For the three months period ended June 30, 2015 Purchases Sales of products Financial revenue Purchases Sales of products Financial revenue Banco Original S.A. - - (5.184) Dan Vigor Ind. Com. Lat. Ltda. (39.508) 89 - (32.409) 40 - Itambé Alimentos S.A. (37.071) JBS S.A. (18.538) (11.858) Seara Alimentos Ltda. (43) Com. E Ind. De Massas Alim. Massa Leve Ltda (95.160) (5.184) (44.267)

18 Notes to the financial statements for the for the six months period ended June 30, 2015 and 2014 For the six months period ended June 30, 2015 For the six months period ended June 30, 2015 Purchases Sales of products Financial revenue Purchases Sales of products Financial revenue Banco Original S.A. - - (6.612) Dan Vigor Ind. Com. Lat. Ltda (62.084) 40 - JBS S.A. (39.373) (38.351) Seara Alimentos Ltda. (586) Com. E Ind. De Massas Alim. Massa Leve Ltda (39.959) (6.612) ( ) For the three months period ended June 30, 2015 For the three months period ended June 30, 2015 Purchases Sales of products Financial revenue Purchases Sales of products Financial revenue Banco Original S.A. - - (5.184) Dan Vigor Ind. Com. Lat. Ltda (32.409) 40 - JBS S.A. (23.842) (11.858) Seara Alimentos Ltda. (43) Com. E Ind. De Massas Alim. Massa Leve Ltda (23.885) (5.184) (44.267) Remuneration of key management Key management personnel includes the Board of Executive Officers and the Board of Directors. The overall remuneration received by these managers for services in their respective fields of knowledge came to R$ on June 30, 2015 (eleven members), and R$ in 2014 (eight members). The Directors of Commercial, Marketing, Supply Chain, Industrial, Financial and Administration and Control and Investor Relations and Director Chairman are part of the employment contract regime CLT (which is the Consolidation of Labor Laws), which follows all the legal prerogatives of payments and benefits. In accordance with IAS 24(R)/CPC 05 (R1) - Related parties, except for those described above, the other members of the Executive Board, and Board of Directors are not part of any employment contract or any other contracts for additional business benefits such as post-employment benefits or other long-term benefits, termination of work that does not conform to those requested by the CLT, where applicable, or payment based on shares. 11 Investments in subsidiaries June 30, 2015 December 31, 2014 June 30, 2015 December 31, 2014 a) Investments in subsidiaries Relevant information about subsidiary in the period on June 30, 2015: June 30, 2015 Number of shares (Thousands) Participation Capital stock Equity Net income Dan Vigor Ind. Com. Lat. Ltda ,00% Itambé Alimentos S.A ,00% December 31, 2014 Ágio / Mais Valia Adições de Investimentos Equivalência patrimonial Dividends proposed June 30, 2015 Dan Vigor Ind. Com. Lat. Ltda Itambé Alimentos S.A (7.207) Total (7.207) The total balances of assets and liabilities of subsidiaries Dan Vigor and Itambé are as follows. For the periods ended June 30, 2015 ASSETS Dan Vigor Itambé Current Non-current TOTAL ASSETS LIABILITIES AND EQUITY Current Non-current Equity TOTAL LIABILITIES AND EQUITY The results of Dan Vigor and Itambé Alimentos S.A. are as follows: For the periods ended June 30, 2015 STATEMENT OPERATION Dan Vigor Itambé Net sales Cost of goods sold (47.592) ( ) GROSS PROFIT General, administrative and selling expenses (6.995) ( ) Financial income (expense), net (599) (12.229) Other (expense) income Income taxes (5.636) (14.783) NET INCOME OF THE YEAR

19 Notes to the financial statements for the for the six months period ended June 30, 2015 and Property, plant and equipment, net Net amount Cost Accumulated depreciation June 30, 2015 December 31, 2014 Buildings (96.525) Land Machinery and equipment ( ) Facilities (49.417) Computer equipment (9.133) Vehicles (4.622) Construction in progress Other (4.372) ( ) Changes in property, plant and equipment December 31, 2014 Additions Write-off Transfers June 30, 2015 Cost Buildings Land Machinery and equipment (12) Facilities Computer equipment (26) Vehicles (688) Construction in progress Other (500) (6.548) (1.226) Depreciation Buildings (93.734) (2.791) - - (96.525) Machinery and equipment ( ) (5.338) ( ) Facilities (46.145) (3.318) 46 - (49.417) Computer equipment (8.355) (778) - - (9.133) Vehicles (4.803) (63) (4.622) Other (4.073) (302) 3 - (4.372) ( ) (12.590) ( ) Net amount (488) Net amount Cost Accumulated depreciation June 30, 2015 December 31, 2014 Buildings ( ) Land Machinery and equipment ( ) Facilities ( ) Computer equipment (24.398) Vehicles (5.970) Construction in progress Other (13.304) ( ) Movimentação do ativo imobilizado December 31, 2014 Additions Write-off Transfers June 30, 2015 Cost Buildings (2) Land Machinery and equipment (3.776) Facilities (2) Computer equipment (511) Vehicles (688) Construction in progress (*) (2.578) (1.990) Other (8.756) (4.673) (16.313) Depreciation Buildings ( ) (6.956) - - ( ) Machinery and equipment ( ) (26.924) ( ) Facilities ( ) (8.944) 49 - ( ) Computer equipment (22.310) (2.562) (24.398) Vehicles (5.578) (636) (5.970) Other (11.546) (1.928) (13.304) ( ) (47.950) ( ) Net amount (13.650) (*) The balance of construction in progress refers mainly to improvement projects and production process. Changes "Pro-forma" in Danvigor s property, plant and equipment (*) December 31, 2014 Additions Write-off Transfers June 30, 2015 Cost - Dan Vigor (8.757) Vigor + Itambé (7.556) Total (16.313) Depreciation - Dan Vigor (20.927) (1.101) - - (22.028) - Vigor + Itambé ( ) (25.921) ( ) - Total ( ) (27.022) ( ) Net amount (13.651) (* ) The Danvigor was acquired remaining 50% in the first quarter of 2015 as mentioned in Note 2 in item Events / Material Facts, why it was secreted note for the interpretation of actual movement of cash flow. According to IAS 16/CPC 27 - Fixed Assets, in June 30, 2015 the made a review of the useful lives of fixed assets, resulting in different rates of depreciation for each asset. Below is shown the minimal and maximal rates of depreciation rates of assets that make up each group. 16

20 Notes to the financial statements for the for the six months period ended June 30, 2015 and 2014 Average annual depreciation rates as of June 30, 2015 Minimum Maximum Building 1,67% 3,33% Machinery and equipment 4,00% 10,00% Facilities 4,00% 10,00% Computer Equipment 8,33% 33,33% Vehicles 6,67% 20,00% Other 1,67% 10,00% 13 Intangible June 30, 2015 December 31, 2014 June 30, 2015 December 31, 2014 Goodwill Trademarks Software's Changes in Intangible assets December 31, 2014 Additions Write-off Amortization June 30, 2015 Goodwill Trademarks Software's (1) (1.039) (1) (1.039) December 31, 2014 Additions Write-off Amortization June 30, 2015 Goodwill Trademarks Software's (305) (3.282) (305) (3.282) Changes "Pro-forma" in Danvigor s property, plant and equipment (*) December 31, 2014 Additions Write-off Amortization June 30, 2015 Goodwill, Trademarks and Software's - Dan Vigor (21) Vigor + Itambé (306) (3.259) Net amount (306) (3.280) (* ) The Danvigor was acquired remaining 50% in the first quarter of 2015 as mentioned in Note 2 in item Events / Material Facts. However, the value of the goodwill from the acquisition of Danvigor the first quarter of 2015 of R$ , R$ , refers to gain share in the fair value determined in this operation, the previous 50%. Goodwill In the year of 2008 the subsidiary Vigor acquired a 100% interest in Laticínios Serrabella Ltda, with goodwill of R$ 1.481, wich have indefinite life can no be amortized, but should be tested for impairment on an annual basis. In January 2012, ocurred the cession of JBS S.A investment at carrying amount, including goodwill, in S.A. Fábrica de Produtos Alimentícios Vigor for 's capitalization. This cession occurs as a result of a transaction under common control, in which the parent JBS S.A. has subscribed the capital on the amount of R$ in the by cession of investment at carrying amount (R$ ) and goodwill (R$ 860,946) in the S.A. Fábrica de Produtos Alimentícios Vigor ("Vigor"). At that date the became the wholly shareholder of Vigor, there has been no change in its final control, which remained with the parent company JBS S.A. The values recorded in the financial statements represent the carrying amount in JBS S.A. before such transaction. In November 2012, the Vigor acquired 100% of Laticino MB Ltda, with goodwill of R$ In June 2013, the acquired 50% of Itambé Alimentos S.A., with goodwill of R$ In February 2015, reported a goodwill of R$ related to the purchase of 50% of Danvigor. Goodwill: According to technical interpretation ICPC 09 - Individual Financial Statements, Separate Statements, Statements and Application of Equity Method, in the consolidated statements goodwill is recorded in the Intangible assets due to expected profitability of the acquired subsidiary, assets and liabilities are consolidated in the. In the balance sheet of the Individual Statements, this goodwill is recorded in Investments, the same group of noncurrent assets, because, for the it is part of its investment on subsidiary acquisition, not being its intangible assets (as stated above, the expectation of future earnings - the genuine intangible - is the subsidiary). Goodwill impairment testing The tested goodwill for impairment using the value-in-use approach, applying models of discounted cash flows that represent the sets of tangible and intangible assets used in the development and sale of products to its customers. Determining the value in use requires the use of assumptions, judgments and estimates on the cash flows, such as revenue growth rates, costs and expenses, future investment and working capital estimates and discount rates. The assumptions on growth, cash flows and future cash flows projections are based on Management s best estimates as well as on comparable market inputs, the economic conditions that will exist over the remaining useful lives of the sets of assets that generate cash flows. Future cash flows have been discounted using rates that represent the cost of capital (WAAC). Consistently with economic valuation techniques, the value-in-use calculation is made for a ten-year period and, from then on, considering the perpetuity of the assumptions taking into consideration the ability to continue as a going concern for an indefinite term. Management s decision to use a ten-year period was based on its past experience in preparing accurate cash flow projections. Such understanding is in line with paragraph 35 of IAS 36/CPC 01 R1 (R)- Impairment of Assets. The growth rates used to extrapolate the projections for periods beyond ten year range from 4,0% per year in notional amounts. The estimated future cash flows were discounted at discount rates of 12.60%, also in notional amounts. The main assumptions used to estimate the value in use are as follows: Sales revenues Revenues were projected for the period assuming that the sales volume of the different products considered as cash-generating units will grow. Operating costs and expenses Costs and expenses were projected consistently with the 's historical performance and revenue growth. Capital investments Investments in capital assets were estimated considering the maintenance of the existing infrastructure and the expectations necessary to make the offering of products feasible. The key assumptions were based on the s historical performance and reasonable and reliable macroeconomic assumptions, based on financial documented market projections, approved by the s management. Based on the annual impairment testing of the s intangible assets based on the projections made over the financial statements for the year ended December 31, 2014, growth prospects and monitoring of projections and results from operations during the year ended December 31, 2014, no losses or indications of impairment were identified, since the value in use is higher than net carrying amount at the valuation date. 17

21 Notes to the financial statements for the for the six months period ended June 30, 2015 and Trade accounts payable Domestic market June 30, 2015 December 31, 2014 June 30, 2015 December 31, 2014 Materials and services Finished products Foreign Market Inputs Loans and financings Current Type Em moeda nacional Average annual rate of interest and commissions June 30, 2015 December 31, 2014 June 30, 2015 December 31, 2014 BNDES_Automático 10,25% p.y Working Capital CDI + 0,19% p.y FGPP 6,50% p.y Finame 4,24% p.y EXIM 8,00% p.y BNDES Finem IPCA+3,08%p.y ACC 105,65% p.y.(swap) Lei 4131 CDI+2,35% p.y.(swap) Leasing 12,08% p.y Progeren 8,35% p.y CCB CDI + 1,02% p.y Non Current Type Em moeda nacional Average annual rate of interest and commissions Maturity June 30, 2015 December 31, 2014 June 30, 2015 December 31, 2014 BNDES_Automático 10,25% p.y September 15, Capital de Giro CDI + 1,60% p.y. June 27, Finame 3,59% p.y July 15, EXIM 8,00% p.y December 15, BNDES Finem IPCA + 3,08%p.y November, Lei 4131 CDI+2,35% p.y.(swap) February, Leasing 12,22% p.y July 17, Progeren - October 15, CCB 112% do CDI June 04, Breakdown: Current liabilities Non current liabilities Maturities of long-term debt are as follows: June 30, 2015 December 31, 2014 June 30, 2015 December 31, á The s most significant fundraising operations refer to working capital loans, where there are no physical(asset) and/or specific guarantees, as these loans are guaranteed by the Vigor itself and its parent company. Specifically in financing and leasing of assets, financings are collateralized by the financed assets. 16 Debentures Type Average annual interest rates and fees Maturity June 30, 2015 December 31, 2014 June 30, 2015 December 31, 2014 Debentures (main) CDI + 2,68% p.y. April 26, Cost April 26, (-) Fees (3.990) (4.403) (3.990) (4.403) Breakdown: Current liabilities Non current liabilities

22 Notes to the financial statements for the for the six months period ended June 30, 2015 and 2014 Maturities of long-term debt are as follows: June 30, 2015 December 31, On May 29, 2013, through a issuing contract (Instrumento Particular de Escritura), the completed the first issuing of simple, non-convertible debentures, having Pentágono S.A. Distribuidora de Títulos e Valores Mobiliários as fiduciary agent and Banco Bradesco S.A. as supporting bank. For all meanings and legal effects, the issuing dated April 26, Amounts and costs: 410 Debentures with individual, nominal value of R$ ,00 (one million reais) were issued in two series, amounting to R$ ,00 (four hundred and ten million reais). The series are distributed as follows: First tranche of 310 Debentures, amounting to R$ ,00, at 100% CDI + 2,75% cost p.y. Second tranche of 100 Debentures, amounting to R$ ,00, at 100% CDI + 2,45% cost p.y. Due dates: 7 years from the issuing date (April 26, 2013), with due date on April 26, Each individual debenture will have its value amortized over the course of 5 years beginning the 36 month of the issuing date, the first payment occurring on April 26, 2016 and the last payment on the due date. Interest will be paid annually and the first payment will occur on April 26, Covenants: Financial Index EBITDA Gross Debt (-) Cash and cash equivalents Net Debt Covenant (/) Net debt / EBITDA 1,5 Required covenants ,0x ,5x 2015 > 3,0x On June 30, 2015, EBITDA is computing the result of twelve months of Itambé Alimentos SA and Parent Vigor Alimentos SA Therefore, this quarter we reached the Covenant EBITDA Net Debt of 1,5, which is within the rate of 3.0 x set for June Uses: The funds were allocated to the investment in the acquisition of 50% of Itambé Alimentos S.A., the purchase of milk from rural producers and the 's activities related to production, sale, processing and industrialization of agricultural products. Guarantee Collateralization of common shares issued by Itambé Alimentos S.A. 17 Payroll, social charges and tax obligation June 30, 2015 December 31, 2014 June 30, 2015 December 31, 2014 Payroll and related social charges Accrual for labor liabilities Withholding income taxes and social contribution taxes ICMS tax payable PIS/ COFINS tax payable Taxes in installments (Law 11941/2009) (a) Others Breakdown: Current liabilities Non current liabilities a) Installment debts Law of May 27, 2009 The amount of each installment will incurred interest corresponding to the variation of the Selic rate In November 2009, the joined the installment debts referred in Law No of May 27, 2009, and has the option to settle the penalties and default interest amounts, including those related to debts of the Debt Union (Dívida Ativa da União) using the credits arising from tax loss and negative basis of the Social Contribution (CSLL). The minimum installment due from the Outstanding Installment (Parcelamento Excepcional) described in the article 1 and 8 of MP No. 303/06 is equivalent to 85% of the installment due payable in the month of November/2009 and R$ for the other debts of the corporation, which will expire on the last day of each month. The term was split in 161 installments. The first installment was paid in the month it was submitted an application for accession, having an effect in the corresponding requirements formulated with the first installment in an amount not less than the described in the Act. Computed the benefits paid during the term of PAEX (Outstanding Installment), the debts that make up the remaining balances of installment payments will be reinstated to the date of application for subdivision, with the legal charges due at the time of occurrence of the respective taxable events, the computed interest rate cuts, fines and legal charges, as well as the settlement of claims with interest and penalties resulting from tax losses and negative basis of social contribution (CSLL). On the amount of tax claims, the has compensated anticipations of R$ made between the years 2009 to 2011 regarding minimum anticipated to join the subdivision according to the law /2009. Changes in instalment debts IRS - Internal Revenue Service Social Security Total Total on December 31, 2014 ( ) (36) ( ) Interest (8.443) - (8.443) Compensation and payments Total on June 30, 2015 ( ) - ( ) 19

23 Notes to the financial statements for the for the six months period ended June 30, 2015 and Provision for lawsuits risk The Vigor is party to ongoing legal proceedings involving labors, tax, and civil matters, which represent contingent liabilities. The proceedings are in the administrative defense stage and/or in progress in courts of law. Based on the opinion of internal and external legal counselors, the Management of the and its controlled company maintain an adequate provision for contingencies to cover potential losses which might arise from unfavorable final outcome of the legal proceedings, as shown below: June 30, 2015 December 31, 2014 June 30, 2015 December 31, 2014 Labor Civil Tax Total Changes in Contingencies December 31, 2014 Additions Disposal June 30, (925) (1.393) Labor claims Refer to several labor claims filed by former employees. A provision was recorded for these labor claims based on an estimate of losses made by legal advisors and approved by the Management of the. Civil proceedings Refer to several civil claims that were accrued based on an estimate of losses prepared by legal advisors and approved by the Management of the and of the Vigor. Tax proceedings Tax processes refer mainly to Funrural tax-related issues (R$ 2.135) and some inconsistencies linked to accessory obligations (R$ 822) 19 Income and social contribution taxes Income tax and social contribution are recorded based on taxable profit in accordance with the laws and applicable rates. Income tax and social contribution-assets are recognized on temporary differences. Income tax and social contribution tax-liabilities were recorded on the revaluation reserves established by the and on temporary differences. a) Reconciliation of expenses of income tax and social contribution Net income before taxes Nominal rate Expectation of expenses of income tax and social contribution Adjust to demonstrate the effective rate Permanent additions (write off): For the six months period ended June 30, For the six months period ended June 30, % 34% 34% 34% (55.852) (10.751) (68.394) (25.860) Temporary additions (write off): Allowance for doubtful accounts (947) 7 (1.544) (374) Provision for variable compensation Allowance for Credit Losses 14 - (694) (578) Provision for contingencies (590) (1.042) (1.193) (3.535) Realization of revaluation of reserve (931) (7) (931) (7) Goodwill tax-shield Tax losses Carryforwards Gain in Fair Value - Danvigor Acquisition Other Expenses of current income tax and social contribution - - (21.015) (19.999) Composition of expenses of income tax and social contribution presented statements of operation: June 30, 2015 December 31, 2014 June 30, 2015 December 31, 2014 Current income tax and social contribution - - (21.015) (19.999) Deferred income tax and social contribution (47.118) (4.123) (46.521) (5.643) (47.118) (4.123) (67.536) (25.642) Effective rate 29% 13% 34% 34% For the three months period ended June 30, For the three months period ended June 30, Net income before taxes Nominal rate Expectation of expenses of income tax and social contribution Adjust to demonstrate the effective rate Permanent additions (write off): Temporary additions (write off): % 34% 34% 34% (5.979) (5.931) (10.264) (12.717) (5.833) (783) (5.325) (3.970) Allowance for doubtful accounts (595) (297) (930) (564) Provision for variable compensation (1.292) Allowance for Credit Losses - - (603) Provision for contingencies (168) - (534) (1.941) Realization of revaluation of reserve (528) (1.042) (528) (3.307) Goodwill tax-shield (2) (2) Tax losses Carryforwards Gain in Fair Value - Danvigor Acquisition (8.330) 343 (8.330) 343 Other Expenses of current income tax and social contribution (8.330) - (20.067) (7.992) 20

24 Notes to the financial statements for the for the six months period ended June 30, 2015 and 2014 Composition of expenses of income tax and social contribution presented statements of operation: June 30, 2015 December 31, 2014 June 30, 2015 December 31, 2014 Current income tax and social contribution - - (8.270) (7.992) Deferred income tax and social contribution (3.684) (5.508) (3.684) (2.349) (13.500) Effective rate -30% 21% 8% 36% b) Composition of total deferred income tax and social contribution presented Balance Sheets: Composition of deferred income tax and social contribution Assets:. Recognized on temporary differences June 30, 2015 December 31, 2014 June 30, 2015 December 31, 2014 (22.272) (7.725) Tax losses Negative Basis of social contribuition Allowance for doubtful accounts Provision for contingencies Allowance for Credit Losses Other Gain in Fair Value - Danvigor Acquisition (43.843) - (43.843) - Asset MB (1.137) - (1.137) - Liabilities:. Recorded on the revaluation reserves and on temporary differences Revaluation reserve Goodwill tax-shield Net amount Deferred income taxes Deferred income taxes is generated by temporary differences at balance sheet date between the taxable basis of assets and liabilities and its accounting amounts. Deferred taxes liability are recognized for all temporary tax differences, except: - when the deferred tax liability arises from initial recognition of goodwill, or when the deferred tax asset or liability asset from the initial recognition of an asset or liability in a transaction that is not a business combination and, on the transaction date, does not affect the accounting net income or taxable profit or fiscal loss, and - when taxable temporary differences related to investments in subsidiary, can be controlled and it is probable that the temporary differences will not be reversed in the foreseeable future. Deferred taxes assets are recognized for all temporary tax differences deductible, credits and not used tax losses, when it is probable and that taxable profit will be available for the temporary differences can be realized, except: - on the deductible temporary differences associated with investments in subsidiary, when it is not probable that the temporary difference will reverse in the foreseeable future and that taxable profit will be available for the temporary differences can be utilized. 20 Equity a) Capital Stock On January 3, 2011, the EGM - Extraordinary General Meeting approved the constitution of the Vigor Alimentos S.A.. The shareholders also approved the election of the first members of the Board of Directors of the. On January 20, 2012, the parent company JBS S.A. has subscribed the capital of R$ in Vigor Alimentos S.A., by cession of investment at carrying amount (R$ ) and goodwill (R$ ) in S.A. Fábrica de Produtos Alimentícios Vigor and with the issuance of common shares, without nominal value. On April 5, 2012, the Board of Directors approved unanimously the proposal to amend the Social Statute, for the purpose of reflecting the split of common shares on ratio of 1 for 1, , that the form 's share capital is now divided into common shares, nominative, without nominal value, enabling the Voluntary Tender Offer for Common Shares Issued by JBS SA by Exchange for Common Shares Issued of the company. According to Article 5 of the Social Vigor Alimentos SA Statute the 's capital is R$ , divided into common, registered shares with no par value. The is authorized to increase its capital by up to common shares, nominative, without nominal value. According to Social Statute, the Board of Directors shall determine the number, price, payment term and other conditions of the share issue. The may grant stock options to management, employees or individuals rendering services thereto or to officers, employees or individuals who provide services to the companies under its control, excluding the preemptive rights of the shareholders in the granting and exercise of stock options. On April 15, 2015 ended the period for subscription of unsubscribed shares in the 's capital increase approved at the Extraordinary General Meeting of February 20, 2015, as a result, the capital increase was completed with 100 % of the subscribed shares. With this increase, 's share capital was increased to R$ ,71 (one billion, three hundred forty -eight million, twenty-seven thousand, seven hundred and seventy-nine reais and seventy one centavos) represented by ( one hundred sixty-two million, seven hundred sixty -eight thousand, four hundred sixty shares, nominative, no value. A total of were subscribed (thirteen million, fifty-four thousand, one hundred fourteen) shares, at an issue price of R$ (twelve reais) per share, totaling R$ ,00 (one hundred and fifty to six million, six hundred forty nine thousand, three hundred sixty-eight reais), of which: (i) (thirty-two thousand, six hundred and three) shares, representing 0,25% of the capital increase social, were subscribed by controlling shareholder, FB Participações, due to the assignment of subscription rights of leftovers that watched Arla Foods International a / S ("Arla"); (ii) (thirteen million twenty one thousand, four hundred seventy-seven) shares, representing 99,75% of the capital increase were subscribed by Arla, and (iii) 34 (thirty-four) representing 0,0003% of the capital increase were subscribed by other minority shareholders. b) Profit Reserve Legal Recorded at the rate of 5% of the profit for the year, pursuant to Article 193 of Law. 6,404/76, up to the limit of 20% of capital stock. For expansion Recorded based on the remaining balance of profit after the legal reserve constitution and dividend distribution, aimed to finance investments in operating assets. c) Dividends According to the statute of the, the statutory dividends correspond to not less than 25% of the adjusted net income of the year, according to corporate law. Position on December 31, 2014 (=) Net Income of the Period (-) Legal (5%) (3.306) (=) Net Income (-) Legal (-) Dividends (25%) Dividends: Quantity Per share Total R$ Ordinary Share , Net sales For the six months period ended June 30, For the six months period ended June 30, Gross sale revenue Products sales revenues Domestic sales Foreign sales Sales deduction Returns and discounts (56.512) (54.999) (85.259) (78.289) Sales taxes ( ) ( ) ( ) ( ) ( ) ( ) ( ) ( ) NET SALE REVENUE

25 Notes to the financial statements for the for the six months period ended June 30, 2015 and 2014 For the three months period ended June 30, For the three months period ended June 30, Gross sale revenue Products sales revenues Domestic sales Foreign sales Sales deduction Returns and discounts (27.777) (27.816) (43.499) (40.371) Sales taxes (64.720) (46.516) ( ) ( ) (92.497) (74.332) ( ) ( ) NET SALE REVENUE Profit per share As per requested by the IAS 33/CPC 41, Profit per share, the following Tables reconcile the Net Profit with the amounts used to calculate the basic per share. Basic The basic profit per share is calculated through the division of the profit attributable to the shareholders of the by the weighted average amount of shares of the year, reduced by the shares in treasury. The has no treasury shares for period on June 30, 2015 and For the six months period ended June 30, Net Profit attributable to shareholders - R$ Average of the shares in the year Average of shares Net Profit per thousand shares - Basic - R$ 0,75 0,18 For the three months period ended June 30, Net Profit attributable to shareholders - R$ Average of the shares in the year Average of shares Net Profit per thousand shares - Basic - R$ 0,15 0,09 Diluted The diluted profit per share is calculated through the adjustment of the weighed average of the amount of circulating shares, supposing the conversion of all the shares that potentially could yield dilution. The does not has categories of that potentially could yield dilution. 23 Financial income (expense), net Financial income For the six months period ended June 30, For the six months period ended June 30, Exchange variation Interest - Gain Financial expenses Exchange variation (11) (65) (7.591) (367) Interest - Loss (59.817) (53.020) (76.713) (72.533) Income from derivative transactions - - (18) - Taxes, contribution, tariff and others (1.962) (2.021) (2.562) (2.591) (61.790) (55.106) (86.884) (75.491) Financial income (expense), net (52.968) (47.446) (65.797) (63.900) Financial income For the three months period ended June 30, For the three months period ended June 30, Exchange variation Interest - Gain Financial expenses Exchange variation 9 (38) (3.307) (138) Interest - Loss (31.450) (26.367) (39.622) (36.677) Income from derivative transactions - - (2.597) - Taxes, contribution, tariff and others (1.176) (1.087) (1.490) (1.370) (32.617) (27.492) (47.016) (38.185) Financial income (expense), net (27.384) (24.283) (33.888) (32.971) 24 Other (expense) income, net For the six months period ended June 30, For the six months period ended June 30, Other (expense) income (2.380) (2.380) Other (expense) income 469 (2.793) (2.793) For the three months period ended June 30, For the three months period ended June 30, 22

26 Notes to the financial statements for the for the six months period ended June 30, 2015 and Expenses by nature The shows below the breakdown of the Income Statement by nature and function: For the six months period ended June 30, For the six months period ended June 30, Classification by nature Depreciation and amortization (13.629) (11.380) (30.302) (26.609) Expenses with personnel ( ) (97.076) ( ) ( ) Raw material, use and consumption material, freight and services ( ) ( ) ( ) ( ) Taxes, fees and contributions Third party capital remuneration (64.646) (56.950) ( ) (97.603) Other (expenses) income ( ) ( ) ( ) ( ) For the six months period ended June 30, For the six months period ended June 30, Classification by function Cost of goods sold ( ) ( ) ( ) ( ) Selling expenses ( ) ( ) ( ) ( ) General and administrative Expenses (77.341) (49.269) ( ) (81.426) Financial income (expense), net (52.968) (47.446) (65.797) (63.900) Equity in earnings of subsidiaries Other operating (expense) income (2.380) ( ) ( ) ( ) ( ) For the three months period ended June 30, For the three months period ended June 30, Classification by nature Depreciation and amortization (6.972) (5.819) (15.396) (13.413) Expenses with personnel (63.520) (49.544) ( ) (98.285) Raw material, use and consumption material, freight and services ( ) ( ) ( ) ( ) Taxes, fees and contributions (12.340) Third party capital remuneration (33.841) (28.905) (58.843) (49.668) Other (expenses) income ( ) ( ) ( ) ( ) For the three months period ended June 30, For the three months period ended June 30, Classification by function Cost of goods sold ( ) ( ) ( ) ( ) Selling expenses ( ) (94.638) ( ) ( ) General and administrative Expenses (39.772) (21.876) (57.221) (39.171) Financial income (expense), net (27.384) (24.283) (33.888) (32.971) Equity in earnings of subsidiaries Other operating (expense) income 469 (2.793) ( ) ( ) ( ) ( ) 26 Operating segments Vigor Management defined the group's operating segments based on executive board reports in the strategic business decision-making process. From investment in Itambé Alimentos S.A., and subsequent consolidation of 100% entitty's results in the 's Financial Statements, a new structure of operating segments to monitor the business performance was necessary. These segments are the following: Refrigerated products: Whole Milk: the main products are whole, semi-skimmed and skimmed milk. Dairy products: The main products are yogurts and smoothies, pettit suisse, fermented milk, desserts, Parmesan cheese, fine cheese, cottage cheese, fondue and creams. Spreads: the main products are margarine, butter, mayonnaise, blends and oils. Grocery products: Dry Packed Food: the main products are powered milk, condensed milk, and caramelized milk. Other: the main products are chantilly spray, chocolate milk, juice and pasta The assets and liabilities by business segment have not been stated, as they are not purpose of analysis in the strategic decision-making process of the executive board. Also due to this reason, the items " Operating Revenue and Expenses, Financial Result and Income and social contribution taxes are not allocated by business segment. For the six months period ended June 30, 2015 Refrigerated products Grocery products Total Net Sales Cost of goods sold ( ) ( ) ( ) Gross Profit For the six months period ended June 30, 2014 Refrigerated products Grocery products Total Net Sales Cost of goods sold ( ) ( ) ( ) Gross Profit For the three months period ended June 30, 2015 Refrigerated products Grocery products Total Net Sales Cost of goods sold ( ) ( ) ( ) Gross Profit For the three months period ended June 30, 2014 Refrigerated products Grocery products Total Net Sales Cost of goods sold ( ) ( ) ( ) Gross Profit

27 Notes to the financial statements for the for the six months period ended June 30, 2015 and Insurance coverage On June 30, 2015, the insurance coverage against operational risks was composed of R$ and R$ for property damage and R$ and R$ for civil liability, respectively, for the Group and for the. 28 Risk management and financial instruments The operations is exposed to market risks arising from their operations, mainly related to possible changes in exchange rates, interest rates, credit risks and liquidity risk. a) Management risk policy The has a formal risk management policy, monitored by the treasury department that uses control instruments through appropriate systems and qualified professionals in risk measurement, analysis and administration that make possible the reduction of the daily risk exposure. Policies incorporate analyses of financial statements of our clients and constant consultation of independant credit monitoring agencies. Additionally, transactions speculative in nature are simply not allowed. b) Interest rate risk The interest rate risk is tied directly to the risk of increases in expenses related to loans and financing, or reduction in income linked to financial investments, considering the fluctuations of market rates. The risk is reduced by the strategy of equalization of the rates contracted to CDI. CDI exposure: June 30, 2015 December 31, 2014 June 30, 2015 December 31, 2014 Assets CDB Liabilities Working Capital - CDI ( ) ( ) ( ) ( ) Debentures ( ) ( ) ( ) ( ) Total ( ) ( ) ( ) ( ) Sensibility analysis The operations are indexed to fixed rates by CDI. Thus, in general, the 's management believes that any fluctuation in interest rates, would create no significant impact on its income. c) Exchange variation risks Exchange rate risk is related to potentially adverse results that may arise from oscillations in this risk factor, which may be caused by economic crisis, sovereign monetary policy alterations, or market movements. The has assets and liabilities exposed to foreign currencies, however the Risk Management Policy does not believe in natural hedging from those opposite exposures, since other important issues like expiry matching and market volatility are very relevant and must be observed. The risk of exchange rate variation on trade accounts receivable in foreign currency from exports, inventories and any other payables denominated in foreign currency, of the. Below are presented the assets and liabilities exposed to exchange rate variation risks, as well as the effects of such accounts in the statements of operations for the years ended on June 30, 2015 and 2014: EXPOSURE OPERACIONAL Accounts receivable - US$ Effects on Statements of Operations June 30, 2015 December 31, 2014 June 30, Subtotal Trade accounts payable - US$ (3.766) (3.319) (11) Subtotal (3.766) (3.319) (11) TOTAL Sensibility Analysis With the aim of providing information on how to behave market risks to which the is exposed on June 30, 2015, we simulate possible changes of 25% and 50% in the relevant variables of risk in relation to the likely scenario. The management believes that the closing prices used in measuring assets and liabilities, based on the date of these interim consolidated financial statements represent a scenario likely to impact the outcome. Following are the net result between the result of exposures and the their derivatives: Exchange risk EXPOSURE Risk Probable scenario (I) Scenario (II) Appreciation - 25% Scenario (III) Appreciation - 50% Operation Premise Appreciation R$ - (6.973) (13.946) - (6.973) (13.946) Exchange rate 3,1026 2,3270 1,5513 d) Credit risks The is potentially subject to credit risks related to accounts receivable, financial investments and hedging contracts. The Strategies to reduce the credit risk is based on the spread of portfolio, not having customers or business group representing over 10% of consolidated sales, credit-related financial ratios and operational health, credit limits, detailed analysis of the financial ability of customers through own federal tax number, affiliates companies and partners federal tax number, and through consult with the agencies of information and constant monitoring of customers. The limits its exposure to credit risk by customer and/or market, through its department of credit analysis and client portfolio management. Thus, the seeks to reduce the economic exposure to a particular customer and/or market that may represent significant losses to the in the event contractual default or implementation of sanitary or trade barrier in countries to which it exports. The market risk exposure is monitored by the Credit Committee that meets regularly with the commercial areas for analysis and control of the portfolio. The parameters used are based on the daily flows of information monitoring operations that identify additional purchase volumes in the market, eventual contracts default, bad checks, and protests or lawsuits against their customers. Internal controls include the assignment of credit limits and configuration status granted to each individual client and automatic lock-billing in the event of default, timeouts or occurrence of restrictive information. The Risk Management Department follows all operations involving credit risk with financial institutions (investments and hedging), monitoring exposure limits set in the Risk Management Policy based in credit ratings provided by international rating agencies. The company held on June 30, 2015 investments with balances exceeding R$ with the following financial institutions: Banco Original and Caixa Econômica Federal. The carrying value of financial assets that represent the maximum exposure to credit risk at reporting date was: Assets Notes June 30, 2015 December 31, 2014 June 30, 2015 December 31, 2014 Cash and cash equivalents Trade accounts receivable Related parties e) Liquidity Risk Liquidity risk arises from the management of working capital and amortization of financing controlled Vigor will find difficulty in meeting their financial obligations falling due. The manage its capital based on parameters optimization of capital structure with a focus on liquidity and leverage metrics that enable a return to shareholders over the medium term, consistent with the risks assumed in the transaction. The Management of the 's liquidity and its subsidiaries is done taking into account mainly the immediate liquidity indicator modified, represented by the level of cash plus investments divided by short-term debt. Based on the analysis of these indicators, the management of working capital has been defined to maintain the natural leverage of the and its subsidiary at levels equal to or less than the leverage ratio that we want to achieve. 24

28 Notes to the financial statements for the for the six months period ended June 30, 2015 and 2014 The index of liquidity and leverage consolidated are shown below: Notes June 30, 2015 December 31, 2014 Cash and cash equivalents Loans and financings - Current Liquidity indicator changed 0,58 0,74 June 30, Less than 1 year Between 1 and 2 years Between 3 and 5 years More than 5 years Book Value Trade accounts payable Loans and Financings Debentures (-) Debentures Cost (825) (1.651) (1.514) - (3.990) TOTAL June 30, 2015 Less than 1 year Between 1 and 2 years Between 3 and 5 years More than 5 years Book Value Trade accounts payable Loans and Financings Debentures (-) Debentures Cost (825) (1.651) (1.514) - (3.990) TOTAL f) Estimated market values The assets and liabilities are represented in the financial statements at cost and their appropriations of revenues and expenses are accounted for in accordance with its expected realization or settlement. g) Financial instruments All financial instruments are represented in the financial statements as shown below: Assets Notes June 30, 2015 December 31, 2014 June 30, 2015 December 31, 2014 Fair value through profit or loss Cash and cash equivalents Loans and receivables Trade accounts receivable Related parties Total Loans and receivables Liabilities to amortized cost Loans and financings Trade accounts payable Total During the period there was no reclassification between categories, fair value through profit or loss, loans and receivables and liabilities at amortized cost. h) Fair value of financial instruments In accordance with IFRS 7/CPC 40 the classify the measuring of fair value in accordance with the hierarchical levels that reflects the significance of the indices used in this measurement, as the following levels: Level 1: Prices quoted in active markets (unadjusted) for identical assets and liabilities; Level 2 - Additional information available, except those of Level 1, in which prices are quoted for similar assets and liabilities, either directly by obtaining prices in active markets or indirectly, as valuation techniques that use data from active markets. Level 3 - The indices used for calculation are not derived from an active market. The do not have this level of measurement instrument. As noted above, the fair values of financial instruments, except for those maturing in the short term, equity instruments with no active market and contracts with discretionary features that fair value can not be reliably measured, are presented in hierarchical levels of measurement below: Fair value hierarchy Current Assets Cash and bank deposits Financial investments Current Assets Cash and bank deposits Financial investments Current Assets Cash and bank deposits Financial investments Book Value June 30, 2015 Level 1 Level 2 Level Level 1 Level 2 Level Book Value December 31, 2014 Level 1 Level 2 Level Current Assets Cash and bank deposits Financial investments Level 1 Level 2 Level Fair Value versus Book Value Loans and financing presented in the table below includes the values of working capital in Reais as shown in detail on Note 16. In the opinion of Management the loans and financing, which are measured at their amortized cost values do not vary significantly with respect to their fair values. These loans and financing are restated on the bases of contracted rates and interest through the date of closing of financial statements, so the outstanding balance is recognized by an amount close to fair value. Since there is no active market for such instruments, the differences that could occur if those values were liquidated in advance would not be significant. 25

29 Notes to the financial statements for the for the six months period ended June 30, 2015 and 2014 The fair values of financial assets and liabilities, together with the carrying amounts presented in the statement of financial position are as follows: Note June 30, 2015 December 31, 2014 Book Value Fair Value Book Value Fair Value Cash and banks Financial investments Trade accounts receivable Related parties Total financial assets Trade accounts payable Loans and financings Total financial liabilities ( ) ( ) ( ) ( ) Note June 30, 2015 December 31, 2014 Book Value Fair Value Book Value Fair Value Cash and banks Financial investments Trade accounts receivable Related parties Total financial assets Trade accounts payable Loans and financings Total financial liabilities ( ) ( ) ( ) ( ) Loans and financing presented in the table above include the amounts of working capital in Reais, as shown in detail in Note 15. In the opinion of management the loans and financing, which are measured at their amortized cost values, do not vary significantly with respect to their fair values. These loans and financing are restated with bases in interest rates and contracted until the closing date of the Financial Statements, and therefore the outstanding balance is recognized for an amount close to its fair value. Since there is no active market for these instruments, differences that could occur if these values were settled in advance would be unrepresentative amounts. EXECUTIVE BOARD Gilberto Meirelles Xandó Baptista Director Chairman Victor Hugo Machado Administrative Director of Finance and Investor Relations Andréia da Silva Cruz Kaway Accountant CRC: 1SP278897/O-3 BOARD OF DIRECTORS Wesley Mendonça Batista Board President Cristiana Arcangeli Gilberto Tomazoni Joesley Mendonça Batista Betania Tanure de Barros Luiz Antonio Rodrigues Elias. Tim Oerting Joergensen FISCAL COUNCIL The Fiscal Council reviewed the report of the Directors and the 's financial statements for the period ended June 30, Our review included: (a) analysis of the financial statements prepared by the ; (B) monitoring the work by external auditors through inquiries inquiries and discussions; and (c) questions about the acts and the relevant transactions made by the 's Directors. Based on our review, the information and received clarification and considering the Independent Auditors' Report, the Audit Committee is not aware of any fact that leads to believe that the financial statements financial statements do not reflect in all material respects the info about them contained and are able to be disclosed by, and did not have any reservations or observations. August 07, 2015 Florisvaldo Caetano de Oliveira Council President José Paulo da Silva Filho Counselor Demetrius Nichele Macei Counselor STATEMENT OF DIRECTORS ON THE FINANCIAL STATEMENTS AND ON THE REPORT OF INDEPENDENT AUDITORS The 's Directors declare for the purposes of Article 25, paragraph 1, items V and VI of CVM Instruction 480 of December 7, 2009, that: (I) They reviewed, discussed and agreed with the opinion expressed in the independent auditors' report on the financial statements for the period ended June 30, 2015; and (Ii) They reviewed, discussed and agreed with the financial statements for the period ended June 30, August 07, 2015 Gilberto Meirelles Xandó Baptista Director Chairman Victor Hugo Machado Administrative Director of Finance and Investor Relations 26

30 V I G O R A L I M E N T O S 2Q15

31 VIGOR ALIMENTOS S.A. SECOND QUARTER (2Q15) RESULTS São Paulo, August 12, Vigor Alimentos S.A. (BM&FBovespa: VIGR3) announces its results for the second quarter of 2015 (2Q15). The complete 2Q15 results information is available at the s Financial Statements. Net revenue rose 31.2% and gross profit was up 42.8% in the Parent in 2Q15. On a consolidated basis, net revenue and gross profit grew 11.8% and 28.7%. 2Q15 HIGHLIGHTS Net Revenue - R$ Million 587 1,066 1, % % 2Q14 2Q15 2Q14 2Q15 Gross Profit - R$ Million % 28.7% 2Q14 2Q15 2Q14 2Q15 EBITDA¹ - R$ Million % -6.1% 51 2Q14 2Q15 2Q14 2Q15 Net Income - R$ Million Net Revenue: The Parent presented net revenue growth of 31.2% over 2Q14, reaching R$587.1 million in 2Q15. On a consolidated basis, net revenue rose 11.8% over 2Q14, totaling R$1,191.8 million in the quarter. Gross Profit: The Parent s gross profit rose 42.8% year-onyear, to R$214.2 million and gross margin was up 3.0 p.p. to 36.5%, in 2Q15. gross profit was R$364.6 million, 28.7% up on 2Q14, and gross margin rose 4.0 p.p. to 30.6%. EBITDA¹: Parent s EBITDA reached R$51.1 million, with an EBITDA margin of 8.7% in 2Q15. EBITDA was R$78.7 million in the quarter, with EBITDA Margin of 6.6%. Net Income: Parent s net income was R$22.9 million and consolidated net income was R$27.8 million in 2Q15. Financial Leverage: The consistent EBITDA growth and greater cash flow resulted in the reduction of financial leverage (consolidated net debt/ebitda¹) to 2.0x at the end to 2Q15 (versus 3.1x in 2Q14 and 2.1x in 1Q15) % % 28 2Q14 2Q15 2Q14 2Q15 Table 1: Summary of Results SUMMARY OF RESULTS Parent 2Q15 2Q14 Var. (%) 1H15 1H14 Var. (%) R$ Thousand 2Q15 2Q14 Var. (%) 1H15 1H14 Var. (%) 104,463 93, % 201, , % Volume Sold 221, , % 426, , % 587, , % 1,074, , % Net Revenue 1,191,775 1,066, % 2,269,282 2,085, % 214, , % 397, , % Gross Profit 364, , % 692, , % 36.5% 33.5% 3.0p.p. 37.0% 33.3% 3.7p.p. Gross Margin (%) 30.6% 26.6% 4.0p.p. 30.5% 26.8% 3.7p.p. 51,141 47, % 101,919 90, % EBITDA¹ 78,671 83, % 168, , % 8.7% 10.6% -1.9p.p. 9.5% 10.3% -0.7p.p. EBITDA Margin (%) 6.6% 7.9% -1.3p.p. 7.4% 8.0% -0.6p.p. 22,910 13, % 117,152 27, % Net Income 27,839 23, % 133,623 50, % 3.9% 3.1% 0.8p.p. 10.9% 3.1% 7.8p.p. Net Margin (%) 2.3% 2.2% 0.1p.p. 5.9% 2.4% 3.5p.p. Note (1): Excluding the goodwill gains from the acquisition of Danubio in 1T15 e 2T15, for a total goodwill of R$128.9 million; and Parent s EBITDA includes equity income from Itambé Alimentos S.A. (50%) and DanVigor (100%), and net income includes financial expenses from debentures in the amount of R$410.0 million for the acquisition of 50% of Itambé Alimentos. VIGOR ALIMENTOS S.A. Page 2 of 16

32 VIGOR ALIMENTOS S.A. SECOND QUARTER (2Q15) RESULTS Message from Management Vigor Alimentos closed another quarter with strong volume, revenue and gross profit growth. In the quarter, the Parent 's net revenue increased by 31.2% and gross profit was up by 42.8% on 2Q14, posting a substantial improvement in results, even compared to the good results reported in 2Q14. On a consolidated basis, net revenue totaled R$1.2 billion in 2Q15 and amounted to R$2.3 billion in the first half of The commercial strategies and operating excellence of the entire Vigor Team were fundamental throughout the first half and allowed us to reach sustainable results. Our sales volume posted substantial growth, ensuring market share gains in several product categories. Our results reinforce consumer preference for our products and have been ensuring new customers every day, as a result of the value added to our brands through continuous innovation and the launch of new exclusive products, prioritizing product and service quality and brand positioning through significant marketing and trade marketing investments. In the second quarter of 2015, we maintained our investments in the new Dairy Plant in Barra do Piraí, Rio de Janeiro, which will begin operations in the second half. Strong cash flow from operating activities in the period due to the better results and the reduction in working capital enabled us to increase investments in assets and amortize a substantial portion of our debt, continuing to reduce financial leverage, which closed the quarter at 2.0x net debt/ebitda. We remain optimistic and are continuing to invest heavily in our operations. We believe that future results will be better, because we still have operating costs and expenses opportunities to capture, regions to explore, new products to launch and over 7,000 employees who share our values and believe in our Mission to to be the best in what we set out to do, completely focused on our business, ensuring the best products and services for our customers, consistency for our suppliers, profitability for our shareholders and the opportunity of a better future for all our team members. Gilberto Xandó CEO, Vigor Alimentos S.A. VIGOR ALIMENTOS S.A. Page 3 of 16

33 VIGOR ALIMENTOS S.A. SECOND QUARTER (2Q15) RESULTS Financial Highlights Volume Sold In 2Q15, total volume sold by the Parent was up 12.2% on 2Q14, totaling thousand tonnes. Once again the Dairy category stood out, with 32.8 thousand tonnes sold, for an increase of 19.3% on 2Q14. Other categories, UHT Milk and Groceries and Spreads, grew by 12.5% and 8.2% respectively. On a consolidated basis, total volume also recorded a significant increase, reaching thousand tonnes, up 12.6% on 2Q14, and the Dairy category was responsible for 62.5 thousand tonnes sold, which grew by 17.5% on 2Q14. In 1H15, volume sold by the Parent and on a consolidated basis posted growth of higher than 7.0% reaching thousand and thousand tonnes, respectively. Chart 1: Volume Sold (in thousand tonnes) Parent Growth - % 21.7% 10.6% 12.2% 7.5% 2.6% 2Q14 3Q14 4Q14 1Q15 2Q15 Growth²- % 2Q14 3Q14 4Q14 1Q15 2Q15 Parent 12.6% 9.9% 7.6% 2.1% 2Q14 3Q14 4Q14 1Q15 2Q15 Table 2: Volume sold per category (in tonnes) Volume Sold Parent 2Q15 2Q14 Var. (%) 1H15 1H14 Var. (%) Tonnes 2Q15 2Q14 Var. (%) 1H15 1H14 Var. (%) 32,761 27, % 64,876 58, % Dairy 62,520 53, % 123, , % 55,111 50, % 103,579 99, % Groceries and Spreads 100,279 92, % 191, , % 16,592 14, % 33,330 30, % UHT Milk 58,212 50, % 111, , % 104,463 93, % 201, , % Total 221, , % 426, , % Note (2): The result includes data from Itambé Alimentos S.A. only as of 3Q13. VIGOR ALIMENTOS S.A. Page 4 of 16

34 VIGOR ALIMENTOS S.A. SECOND QUARTER (2Q15) RESULTS Net Revenue In 2Q15, the Parent s net revenue totaled to R$587.1 million, posting substantial 31.2% growth year-on-year, with the Dairy and Groceries and Spreads categories standing out. The Dairy category which is the most representative in terms of sales, recorded revenue of R$295.3 million, up 23.3% on 2Q14. revenue stood at R$1,191.8 million, an increase of 11.8% over 2Q14, as a result of the strong revenue increase in the Dairy category. The has been able to consistently increase sales throughout the last quarters, due to ongoing innovation efforts, better service and product quality, thereby strengthening its market share. In 1H15, the Parent presented net revenue growth of 22.8%, to R$1,074.4 million and on a consolidated basis, growth came to 8.8%, totaling R$2,269.3 million. Chart 2: Net Revenue (R$ million) 1, , , , , % Parent Growth - % 29.4% 31.2% 22.1% 14.0% Q14 3Q14 4Q14 1Q15 2Q15 Growth² - % 2Q14 3Q14 4Q14 1Q15 2Q15 Parent 19.2% 16.1% 5.7% 11.8% 2Q14 3Q14 4Q14 1Q15 2Q15 Table 3: Net Revenue per category (R$ thousand) Net Revenue Parent 2Q15 2Q14 Var. (%) 1H15 1H14 Var. (%) R$ Thousand 2Q15 2Q14 Var. (%) 1H15 1H14 Var. (%) 295, , % 579, , % Dairy 421, , % 828, , % 255, , % 427, , % Groceries and Spreads 654, , % 1,229,804 1,169, % 36,099 31, % 67,227 59, % UHT Milk 115, , % 210, , % 587, , % 1,074, , % Total 1,191,775 1,066, % 2,269,282 2,085, % Note (2): The result includes data from Itambé Alimentos S.A. only as of 3Q13. VIGOR ALIMENTOS S.A. Page 5 of 16

35 VIGOR ALIMENTOS S.A. SECOND QUARTER (2Q15) RESULTS In the Parent, the Dairy category accounted for 50.3% of total net revenue in 2Q15, and Groceries and Spreads accounted for 43.5% and UHT Milk for 6.1%. On a consolidated basis, Groceries and Spreads had a 55.0% share of net revenue, Dairy 35.4% and UHT Milk 9.7% in 2Q15. Chart 3: Net Revenue share of the categories (as a % of the Total) Parent 2Q % 43.5% 6.1% 2Q % 55.0% 9.7% 2Q % 39.5% 6.9% 2Q % 57.2% 9.4% Dairy Groceries and Spreads UHT Milk Dairy Groceries and Spreads UHT Milk The Food Service segment maintained a higher share on the Parent, through the Amélia, Danubio Food Service and Vigor Food Service brands, all dedicated to B2B sales (Business to Business). In the Parent, this segment accounted for 17.8% of its net revenue and 9.2% of consolidated net revenue in 2Q15. Chart 4: Net Revenue share of the segments (as a % of the Total) Parent 2Q % 17.8% 2Q % 9.2% 2Q % 20.6% 2Q % 8.6% Consumption Food Service Consumption Food Service In 2Q15, Parent s product mix recorded a significant increase in average prices, up 17.0% on 2Q14, totaling R$5,620 thousand/tonne. On a consolidated basis, net revenue/tonne sold came to R$5,392 thousand/tonne in 2Q15, 0.7% down on 2Q14, mainly driven by Groceries and Spreads. In 1H15, the Parent reached R$5,325 thousand/tonne, with average prices up by 14.4%, and 1.5% on a consolidated basis, to R$5,318 thousand/tonne. Table 4: Net Revenue / Tonne Sold (R$ thousand/ tonne) Net Revenue / Volume Parent 2Q15 2Q14 Var. (%) 1H15 1H14 Var. (%) R$ Thousand/ Tonnes 2Q15 2Q14 Var. (%) 1H15 1H14 Var. (%) 9,014 8, % 8,938 8, % Dairy 6,739 6, % 6,707 6, % 4,639 3, % 4,126 3, % Groceries and Spreads 6,531 6, % 6,407 6, % 2,176 2, % 2,017 1, % UHT Milk 1,985 1, % 1,895 1, % 5,620 4, % 5,325 4, % Total 5,392 5, % 5,318 5, % VIGOR ALIMENTOS S.A. Page 6 of 16

36 VIGOR ALIMENTOS S.A. SECOND QUARTER (2Q15) RESULTS Cost of Goods Sold In the Parent, Cost of Goods Sold (COGS) totaled R$372.8 million in 2Q15, representing a year-on-year decrease, from 66.5% of net revenue in 2Q14 to 63.5% in 2Q15. COGS amounted to R$827.2 million, accounting for 69.4% of net revenue in 2Q15, substantially lower than the 73.4% recorded in 2Q14. In 1H15, COGS was R$676.7 million for the Parent, representing 63.0% of revenue (compared to 66.7% in 1H14) and R$1,577.1 million on a consolidated basis, representing 69.5% of revenue (compared to 73.2% in 1H14). Chart 5: COGS (R$ Million) % of Net Revenue -Parent 66.5% 65.2% 63.5% 61.2% 62.3% Q14 3Q14 4Q14 1Q15 2Q15 % of Net Revenue % 73.0% 2Q14 3Q14 4Q14 1Q15 2Q % 69.6% 69.4% Parent 2Q14 3Q14 4Q14 1Q15 2Q15 Gross Profit and Gross Margin In 2Q15, gross profit presented a substantial 42.8% increase in the Parent, totaling R$214.2 million, with gross margin increase of 3.0 p.p., from 33.5% in 2Q14 to 36.5% in 2Q15, the highest margin ever recorded for the second quarter. On a consolidated basis, gross profit amounted to R$364.6 million, up 28.7%, with gross margin increase of 4.0 p.p., from 26.6% in 2Q14 to 30.6% in 2Q15, also a new record on a consolidated basis. With a focus on cost rationalization, reducing losses and expenses, and better operational efficiency in all units, the has been improving its operating leverage and increasing productivity. These factors combined with the strategy focused on prioritizing high value-added products have ensured the expansion of business margins. In 1H15, gross profit in the Parent rose 36.4% to R$397.7 million, with a gross margin of 37.0%, an increase of 3.7 p.p. over 1H14. On a consolidated basis, gross profit totaled R$692.2 million, 23.8% higher than in 1H14, with a gross margin of 30.5%, 3.7 p.p. up on 1H14. VIGOR ALIMENTOS S.A. Page 7 of 16

37 VIGOR ALIMENTOS S.A. SECOND QUARTER (2Q15) RESULTS Chart 6: Gross Profit (R$ million) and Gross Margin (%) 33.5% 34.8% 38.8% 37.7% 36.5% Parent Growth - % 50.8% 46.7% 36.6% 42.8% 29.6% 30.0% 30.4% 30.6% 26.6% 27.0% Q14 3Q14 4Q14 1Q15 2Q15 Parent Parent Margin Margin 2Q14 3Q14 4Q14 1Q15 2Q15 Growth² - % 25.9% 28.0% 28.7% 18.8% 2Q14 3Q14 4Q14 1Q15 2Q15 The graph below shows net revenue and COGS by volume sold and reflects the above-mentioned initiatives and its results in recent quarters, demonstrating consistent gross profit growth. In the Parent, gross profit per tonne was R$2.051 thousand/tonne, a substantial 27.4% increase over 2Q14. On a consolidated basis, gross profit per tonne was R$1.650 thousand/tonne, 14.3% up on 2Q14. Chart 7: Net Revenue and COGS / Tonne (R$ thousand / tonne) Parent % % Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 Net Revenue/Volume COGS/Volume 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 2Q15 Net Revenue/Volume COGS/Volume Note (2): The result includes data from Itambé Alimentos S.A. only as of 3Q13. VIGOR ALIMENTOS S.A. Page 8 of 16

38 VIGOR ALIMENTOS S.A. SECOND QUARTER (2Q15) RESULTS Selling, General and Administrative Expenses In the Parent, SG&A expenses amounted to R$179.6 million in 2Q15, equivalent to 30.6% of net revenue in the period, 1.5 p.p. down on the 32.1% in 1Q15. On a consolidated basis, SG&A expenses totaled R$309.4 million, including Itambé Alimentos expenses, equivalent to 26.0% of net revenue, 1.7 p.p. up on the 24.3% recorded in 1Q15. Operating expenses in 2015 reflected the s investments in business expansion, through national marketing and trade marketing campaigns and the sales force expansion to cover new regions. Year-to-date, expenses totaled R$336.1 million in the Parent, equivalent to 31.3% of net revenue, and R$571.2 million or 25.2% of net revenue on a consolidated basis. EBITDA and EBITDA Margin In 2Q15, the Parent s EBITDA totaled R$51.1 million, 7.6% up on 2Q14, and EBITDA margin stood at 8.7%. The decrease of the EBITDA margin of 1.9 p.p. when compared to 2Q14 was due to the lower equity income from Itambé Alimentos in the period, more substantial investments in marketing and trade marketing initiatives and the increased sales structure. On a consolidated basis, EBITDA came to R$78.7 million in 2Q15, with 6.6% EBITDA margin, for a 1.3 p.p. reduction on 2Q14. Chart 8: Adjusted EBITDA¹ (R$ Million) and EBITDA Margin (%) 10.6% 10.9% 11.5% 10.4% 8.7% % Parent Growth - % 7.9% 7.5% 8.8% 8.3% 6.6% 144.7% 117.2% 18.4% 7.6% Q14 3Q14 4Q14 1Q15 2Q15 Parent Parent Margin Margin 2Q14 3Q14 4Q14 1Q15 2Q15 Growth² - % 67.9% 47.1% 8.3% -6.1% 2Q14 3Q14 4Q14 1Q15 2Q15 Table 5: EBITDA (R$ thousand) and EBITDA Margin (%) Parent EBITDA Reconciliation 2Q15 2Q14 Var. (%) 1H15 1H14 Var. (%) R$ Thousand 2Q15 2Q14 Var. (%) 1H15 1H14 Var. (%) 17,586 17, % 164,270 31, % Net Income Before Taxes 30,188 37, % 201,159 76, % 27,384 24, % 52,968 47, % Financial Result 33,888 32, % 65,797 63, % 6,972 5, % 13,629 11, % Depreciation and Amortization 15,396 13, % 30,302 26, % (801) 0 n.a. (128,948) 0 n.a. Excluding the Effect of Goodwill (801) 0 n.a. (128,948) 0 n.a. 51,141 47, % 101,919 90, % Adjusted EBITDA¹ 78,671 83, % 168, , % 8.7% 10.6% -1.9p.p. 9.5% 10.3% -0.8p.p. EBITDA Margin 6.6% 7.9% -1.3p.p. 7.4% 8.0% -0.6p.p. Note (1): Excluding the goodwill gains from the acquisition of Danubio in 1Q15 and 2Q15, for a total goodwill of R$128.9 million; (2): results include information from Itambé Alimentos as of 3Q13. LTM EBITDA totaled R$215.7 million in the Parent and R$356.6 million on a consolidated basis, with LTM EBITDA margins of 10.3% and 7.8% respectively. VIGOR ALIMENTOS S.A. Page 9 of 16

39 VIGOR ALIMENTOS S.A. SECOND QUARTER (2Q15) RESULTS Net Financial Result In 2Q15, the Parent posted net financial expenses totaling R$27.4 million, equivalent to 4.7% of net revenue in 2Q15, 0.7 p.p. down on the 5.4% recorded in 2Q14, driven by the reduction in financial leverage and the average cost of debt, partially offsetting the average CDI interbank rate increase in the period, from 10.8% in 2Q14 to 13.6% in 2Q15. On a consolidated basis, financial expenses amounted to R$33.9 million, or 2.8% of net revenue, compared to 3.1% in 2Q14. In 1H15, the Parent s net financial expenses came to R$53.0 million, representing 4.9% of net income in the period (compared to 5.4% in 1H14). On a consolidated basis, net financial expenses totaled R$65.8 million, equivalent to 2.9% of 1H15 net revenue (compared to 3.1% in 1H14). Net Income In 2Q15, the Parent s net income came to R$22.9 million, up 66.5% including goodwill gains from the acquisition of Danubio. Excluding goodwill, adjusted net income¹ was R$14.1 million, for an increase of 2.1% on 2Q14 and net margin of 2.4% (-0.7% p.p.). On a consolidated basis, net income was up 16.5%, to R$27.8 million. Excluding the goodwill from Danubio, consolidated adjusted net income came to R$19.0 million and net margin stood at 1.6% (-0.6 p. p.) in 2Q15. Year-to-date, consolidated net income totaled R$133.6 million, with net margin of 5.9%, including the goodwill effect from Danubio acquisition. Excluding the goodwill effect, the Parent posted a net income increase of 16.5% in 1H15, totaling R$32.0 million and net margin of 3.0% (-0.2 p.p.) and on a consolidated basis, net income amounted to R$48.5 million in 1H15 with net margin of 2.1% (-0.3 p.p.). Chart 9: Adjusted Net Income¹ (R$ million) and Net Margin (%) 3.1% 3.3% 4.3% 3.7% 2.4% Parent Growth - % 464.0% 370.7% 2.2% 2.6% 3.4% 2.7% 1.6% % 31.0% 2.1% Q14 3Q14 4Q14 1Q15 2Q15 Parent Parent Margin Margin 2Q14 3Q14 4Q14 1Q15 2Q15 Growth² - % 135.4% 69.9% 11.4% -20.6% 2Q14 3Q14 4Q14 1Q15 2Q15 Note (1): Excluding the goodwill gains from the acquisition of Danubio in 1Q15 and 2Q15: Total goodwill of R$128.9 million and net gain from Income Tax/Social Contribution of R$85.1 million; (2): result includes data from Itambé Alimentos S.A. only as of 3Q13. VIGOR ALIMENTOS S.A. Page 10 of 16

40 VIGOR ALIMENTOS S.A. SECOND QUARTER (2Q15) RESULTS Cash Generation In 2Q15, the Parent s cash flow from operating activities totaled R$102.7 million, due to operating cash of R$41.2 million and a R$61.5 million decrease in working capital. The Parent s loans and financing reduced R$62.6 million, while net investments amounted to R$17.5 million in the quarter, including the continued investments in Barra do Pirai (RJ). On a consolidated basis, cash flow from operating activities amounted to R$148.2 million, R$82.3 million of which from cash from operating activities and R$65.9 million from the working capital reduction. Net cash used in financing activities was R$95.4 million, while consolidated investments came to R$49.7 million. Chart 10: Cash Generation (R$ million) Parent 2Q15 2Q (62.6) (17.5) (95.4) (49.7) Beginning Cash Cash from Oper. Working Capital 0.0 Financing Investments Ending Cash Beginning 0.0 Cash Cash from Oper. Working Capital Financing 0.0 Investments Ending Cash In 1H15, cash flow from operating activities totaled R$161.4 million in the Parent, financing activities amounted to R$37.6 million and net investments activities came to R$201.3 million, R$156.3 million of which from the acquisition of Danubio in 1Q15. As a result, cash and cash equivalents declined from R$132.9 million in Dec/14 to R$130.6 million in Jun/15. On a consolidated basis, cash flow from operating activities totaled R$232.1 million in 1H15, with net funding of R$12.2 million and net investments of R$261.3 million. Thus, cash and cash equivalents declined from R$264.2 million in Dec/14 to R$247.2 million in Jun/15. Net Debt and Leverage At the end of Jun/15, the s consolidated net debt was R$717.5 million, representing a decrease in financial leverage¹ to 2.0x (compared to 3.1x in Jun/14 and 2.1x in Mar/15). Short term debt accounted for 53.4% of total gross debt on a consolidated basis and 41.3% in the Parent, reflecting the reclassification of the 1 st debenture amortization from long to short term, whose maturity is in Apr/2016. The s consolidated cash in Jun/15 was R$247.2 million, equivalent to 48.0% of consolidated short-term debt. Table 6: Net Debt Net Debt Parent Jun/15 Mar/15 Dec/14 R$ thousands Jun/15 Mar/15 Dec/14 664, , ,965 Gross debt 964,755 1,018,086 1,031, , , ,766 (+) Short term 514, , , , , ,199 (+) Long term 449, , , , , ,866 (-) Cash and equivalents 247, , , , , ,099 Net debt 717, , ,292 Index 41.3% 24.4% 26.2% % Short term 53.4% 38.8% 38.6% 58.7% 75.6% 73.8% % Long term 46.6% 61.2% 61.4% 47.6% 62.8% 68.6% % Cash/short term 48.0% 61.7% 66.4% n.a. n.a. n.a. Net Debt/EBITDA¹ 2.0x 2.1x 2.2x VIGOR ALIMENTOS S.A. Page 11 of 16

41 VIGOR ALIMENTOS S.A. SECOND QUARTER (2Q15) RESULTS Even with the higher investment level in 2015, mainly in the new Factory in Barra do Piraí (Rio de Janeiro), the continued to reduce its debt and financial leverage, as a result of reduced working capital needs and increased cash generation from operating activities in the period, as explained before. Chart 11: Financial Leverage¹ 3.1x 2.6x 2.2x 2.1x 2.0x jun-14 sep-14 dec-14 mar-15 jun-15 EBITDA LTM Leverage Debentures in the amount of R$410.0 million, issued in 2013 for the acquisition of Itambé Alimentos, set forth a restrictive covenant clause of a net debt/ebitda ratio of 3.0x for Dec/15. The leverage¹ of 2.0x recorded in Jun/15 comfortably exceeds the ratio set forth for the end of the year. On June 30, 2015, the average cost of consolidated gross debt was 14.7% p.a., or CDI + 1.1% p.a., reflecting the reduction in the spread of the s average cost of debt partially offsetting the CDI increase in the period. Currently, 91% of the s consolidated debt is bound to the CDI (Interbank Deposit Certificate), and the debentures issued for the acquisition of Itambé Alimentos represented 43% of total gross debt, while the remaining portion of the debt was composed of working capital and investment lines, as detailed below: Chart 12: Debt profile (% of total) Debt Per Index Debt Per Type 6% 3% CDI 1% 3% 4% Debentures 6% Working Capital and Capex 91% Fixed IPCA 43% 43% FINAME ACC FGPP Other Note (1) Excludes the goodwill gain from the acquisition of Danubio in 1Q15 and 2Q15: Total goodwill of R$128.9 million and net gain from Income Tax/Social Contribution of R$85.1 million; and LTM EBITDA includes equity income from Itambé. VIGOR ALIMENTOS S.A. Page 12 of 16

42 VIGOR ALIMENTOS S.A. SECOND QUARTER (2Q15) RESULTS Appendix 1: Income Statement Parent Income Statement 2Q15 2Q14 Var. (%) 1H15 1H14 Var. (%) R$ thousand 2Q15 2Q14 Var. (%) 1H15 1H14 Var. (%) 587, , % 1,074, , % Net revenue 1,191,775 1,066, % 2,269,282 2,085, % (372,833) (297,316) 25.4% (676,719) (583,338) 16.0% Cost of goods sold (827,169) (782,686) 5.7% (1,577,069) (1,525,991) 3.3% 214, , % 397, , % Gross profit 364, , % 692, , % (169,249) (108,276) 56.3% (180,489) (212,512) -15.1% Operating expenses (300,530) (213,007) 41.1% (425,257) (419,070) 1.5% (179,586) (116,514) 54.1% (336,128) (235,342) 42.8% Selling, general and administrative (309,428) (217,110) 42.5% (571,233) (431,574) 32.4% 9,868 11, % 26,945 25, % Equity in the earnings of subsidiaries % 0 2, % 469 (2,793) % 128,694 (2,380) % Other revenues (expenses) 8,898 3, % 145,976 10, % 44,970 41, % 217,238 79, % Operating result 64,076 70, % 266, , % (27,384) (24,283) 12.8% (52,968) (47,446) 11.6% Net financial result (33,888) (32,971) 2.8% (65,797) (63,900) 3.0% 17,586 17, % 164,270 31, % Net income before taxes 30,188 37, % 201,159 76, % 5,324 (3,684) % (47,118) (4,123) % Income tax and Social contribution (2,349) (13,500) -82.6% (67,536) (25,642) 163.4% 22,910 13, % 117,152 27, % Net income 27,839 23, % 133,623 50, % (8,859) 0 n.a. (85,106) 0 n.a. Reversal of goodwill¹ (8,859) 0 n.a. (85,106) 0 n.a. 14,051 13, % 32,046 27, % Adjusted net income 18,980 23, % 48,517 50, % 2Q15 2Q14 Var. (%) 1H15 1H14 Var. (%) EBITDA reconciliation 2Q15 2Q14 Var. (%) 1H15 1H14 Var. (%) 17,586 17, % 164,270 31, % Net income before taxes 30,188 37, % 201,159 76, % 27,384 24, % 52,968 47, % Net financial result 33,888 32, % 65,797 63, % 6,972 5, % 13,629 11, % Depreciation and amortization 15,396 13, % 30,302 26, % 51,942 47, % 230,867 90, % EBITDA 79,472 83, % 297, , % (801) 0 n.a. (128,948) 0 n.a. Reversal of goodwill¹ (801) 0 n.a. (128,948) 0 n.a. 51,141 47, % 101,919 90, % Adjusted EBITDA 78,671 83, % 168, , % 36.5% 33.5% 3.0p.p. 37.0% 33.3% 3.7p.p. Gross margin 30.6% 26.6% 4.0p.p. 30.5% 26.8% 3.7p.p. 8.7% 10.6% -1.9p.p. 9.5% 10.3% -0.9p.p. EBITDA margin 6.6% 7.9% -1.3p.p. 7.4% 8.0% -0.6p.p. 2.4% 3.1% -0.7p.p. 3.0% 3.1% -0.2p.p. Net margin 1.6% 2.2% -0.6p.p. 2.1% 2.4% -0.3p.p. Note (1) Excluding the goodwill gain from the acquisition of Danubio in 1Q15 and 2Q15: total goodwill of R$128.9 million and net gain from Income Tax/Social Contribution of R$85.1 million in 1Q15. VIGOR ALIMENTOS S.A. Page 13 of 16

43 VIGOR ALIMENTOS S.A. SECOND QUARTER (2Q15) RESULTS Appendix 2: Balance Sheet Balance Sheet Parent R$ thousand , ,866 Cash and cash equivalents 247, , , ,378 Trade accounts receivable 464, , , ,221 Inventories 317, ,030 86, ,896 Recoverable taxes 154, ,434 27,495 3,642 Prepaid expenses 29,291 4,544 19,332 17,740 Other current assets 32,541 22, , ,743 CURRENT ASSETS 1,245,541 1,270, ,277 Related-party transactions 0 1,277 28,719 26,074 Deposits, security interest and other 37,491 26, ,497 91,197 Recoverable taxes 106,127 93, , ,839 Investments 0 27, , ,587 Property, plant and equipment 1,127,134 1,040, , ,889 Intangible assets 1,423,791 1,164,739 2,312,641 1,956,863 NON-CURRENT ASSETS 2,694,543 2,353,956 2,929,320 2,562,606 TOTAL ASSETS 3,940,084 3,624, , ,442 Trade accounts payable 397, , , ,218 Loans and financing 423, ,199 91,371 38,548 Debentures 91,371 38,548 74,213 69,562 Tax, labor and social liabilities 122, ,636 15,701 15,701 Dividends declared 15,701 19, Taxes payable 5,546 1,385 44,810 20,782 Other current liabilities 74,127 46, , ,253 CURRENT LIABILITIES 1,129, ,886 66, ,602 Loans and financing 125, , , ,597 Debentures 324, , , ,747 Tax, labor and social liabilities 232, ,747 88,105 40,987 Taxes payable 167, ,141 7,191 5,456 Provision for legal contingencies 21,280 16, Other non-current liabilities 4,922 5, , ,539 NON-CURRENT LIABILITIES 875,450 1,013,812 1,347,636 1,191,378 Capital stock 1,347,636 1,191,378 71,032 71,032 Profit reserve 71,032 71,032 6,404 6,404 Accumulated translation adjustments 6,404 6, ,152 0 Net income for the period 117, Non-controlling interest 392, ,171 1,542,224 1,268,814 EQUITY 1,934,659 1,651,985 2,929,320 2,562,606 TOTAL LIABILITIES AND EQUITY 3,940,084 3,624,683 VIGOR ALIMENTOS S.A. Page 14 of 16

44 VIGOR ALIMENTOS S.A. SECOND QUARTER (2Q15) RESULTS Appendix 3: Statement of Cash Flow Statement of Cash Flows Parent 2Q15 2Q14 1H15 1H14 R$ thousand 2Q15 2Q14 1H15 1H14 22,910 13, ,152 27,497 Net income¹ 22,910 13, ,152 27,497 6,972 5,819 13,629 11,380 Depreciation and amortization 15,396 13,413 30,302 26,609 25,364 17,703 52,261 43,834 Financial charges 34,395 27,796 73,771 62,931 (5,325) 3,684 47,118 4,123 Deferred income tax and social contribution (2,424) 5,508 46,521 5,643 2,444 1,009 5, Provision for Losses 3,462 1,061 7, (9,868) (11,031) (26,945) (25,210) Equity income 0 (889) 0 (2,289) Non-controlling shareholders 4,930 10,142 16,471 22,921 (522) ,831 Income from sale of property and equipment 4, ,651 3,893 (802) 0 (128,948) 0 Interest gain on the acquisition of Dan Vigor (801) 0 (128,947) 0 41,173 30,977 80,490 66,055 Cash from operations before working capital 82,337 70, , , Opening balance - Dan Vigor 0 0 6,089 0 (9,433) (15,353) 9,058 (20,757) Accounts receivable from clients 22,407 (31,034) 46,455 (66,820) (10,198) (4,577) (15,010) (7,211) Inventories 7,077 3,852 12,230 1,661 (9,656) (7,800) 2,677 (14,977) Recoverable taxes (9,603) (11,770) (1,270) (17,352) (7,389) (4,804) (26,371) (12,844) Other assets (17,280) (17,152) (40,622) (26,664) 76,123 (5,311) 93,910 3,190 Trade accounts payable 45,543 (14,642) 12,079 (8,951) 1,821 0 (7,201) 0 Labor and social liabilities (3,426) 0 (8,218) 0 20,240 8,972 23,878 (1,451) Other liabilities 21,149 10,320 28,609 (2,351) 61,508 (28,873) 80,941 (54,050) Working capital 65,867 (60,426) 55,352 (120,477) 102,681 2, ,431 12,005 Cash flow from operating activities 148,204 10, ,136 27,455 (25,527) (9,420) (52,267) (20,190) Additions to Fixed Assets and Intangible Assets (49,667) (12,925) (234,008) (26,035) 7, ,207 0 Dividends received (156,258) 0 Additional investments 0 0 (27,311) 0 (17,520) (9,420) (201,318) (20,190) Cash flow from investing activities (49,667) (12,925) (261,319) (26,035) (123,944) (111,770) (180,164) (140,435) Payment of loans and financing (236,977) (229,184) (352,562) (276,315) 61,495 32,363 61,495 34,499 Loans and financing 153, , , , Declared dividends/accrued profits (11,423) (5,541) (11,423) (5,541) ,258 0 Capital Increase ,258 0 (129) Securities issuance costs (129) (62,578) (79,155) 37,589 (105,429) Cash flow from financing activities (95,386) (113,110) 12,241 (157,850) 107, , , ,610 Opening balance of cash and cash equivalents 244, , , , ,568 67, ,568 67,996 Closing balance of cash and cash equivalents 247, , , ,429 22,583 (86,471) (2,298) (113,614) Cash variation 3,151 (115,625) (16,942) (156,430) Note (1): Net Income, on the Statements of Cash Flow, excludes the participation of non-controlling shareholders, equivalent to 50% of Itambé Alimentos S.A. net result. VIGOR ALIMENTOS S.A. Page 15 of 16

45 VIGOR ALIMENTOS S.A. SECOND QUARTER (2Q15) RESULTS 2Q15 RESULTS CONFERENCE CALL (Simultaneous Translation) Replay for 7 days: Conference Call Webcast: Contacts: Headquarters Rua Joaquim Carlos, Belenzinho CEP: São Paulo/SP Brazil Phone: Investor Relations ri@vigor.com.br Phone: Legal Notice Unless otherwise indicated, the financial and operational information herein is presented on a consolidated basis, in nominal reais, pursuant to International Financial Reporting Standards ( IFRS ). Quantitative information, such as volume, is unaudited. The result includes data from Vigor Alimentos S.A. and Itambé Alimentos S.A. (as of 3Q13). In 2Q15, the began to report the breakdown of Volume Sold and Net Revenue, both in the Parent and on a consolidated basis, in three categories: Dairy, UHT Milk and Groceries/Spreads. Dairy consist of: yogurt, fermented milk, desserts, petit suisse, cream cheese spread, parmesan, cheese, frescal cheese, cream cheese, fondue, cream and chantilly. UHT Milk consists of: UHT, pasteurized, skimmed, whole and flavored milk. Groceries/Spreads consists of: margarine, mix, butter, cooking fat, mayonnaise, blend, powdered milk, milk candy, condensed milk, Juices, chocolate milk, pasta, sauce and others; We make statements about future events that are subject to risks and uncertainties. These statements are based on beliefs and assumptions of our Management, and on information currently available to the. Statements about future events include information about our intentions, beliefs or current expectations, as well as of the 's Board of Directors and Officers. Exceptions related to the statements and information about the future also include information about operating results, likely or presumed, as well as statements that are preceded by, followed by, or including words, such as believes, might, will, continues, expects, provides for, intends, plans, estimates", or similar expressions. Statements and information about the future are not guarantee of performance. They involve risks, uncertainties and assumptions because they refer to future events, thus depending on circumstances that might or not might occur. Future results and creation of value to the shareholders might significantly differ from the ones expressed or suggested by forward-looking statements. Many of the factors that will determine these results and values are beyond our control or forecast capacity. This report should be read together with the quarterly financial statements for this particular period, filed with the CVM. VIGOR ALIMENTOS S.A. Page 16 of 16