CETIP S.A. Mercados Organizados

Transcription

1 (A free translation of the original in Portuguese) CETIP S.A. Mercados Organizados Condensed interim financial statements as at

2 Condensed interim financial statements as at Contents Comments on performance 3-19 Independent auditors review report on condensed interim financial statements Balance sheets 22 Statements of income 23 Statements of comprehensive income 24 Statements of changes in shareholders equity 25 Statements of cash flows 26 Statements of value added 27 Notes to the condensed interim financial statements

3 Comments on performance Dear Shareholders, We submit to your appreciation the Quarterly Information of CETIP S.A. Mercados Organizados ( CETIP or Company ) for the quarter ended on, together with the respective independent auditors' report. All the Company s operating and financial information below, except when otherwise indicated, is presented in million reais based on the individual financial statements prepared according to the generally accepted accounting principles in Brazil established by the Accounting Pronouncement Committee (CPC) and the consolidated financial statements were prepared according to the CPCs and the International Financial Reporting Standards IFRS established by the International Accounting Standards Board IASB. Additional information regarding the Company s operating and financial performance are available on the internet at ( FINANCIAL RESULTS ANALYSIS OPERATING REVENUES (R$ million) 2Q15 1Q15 2Q14 1H15 Change Change Change 1H14 2Q15/1Q15 2Q15/2Q14 1H15/1H14 Gross operating revenue % 17.0% 15.0% Securities Unit % 20.3% 19.5% Registration % -0.2% 2.0% Custody % 37.0% 34.5% Monthly Utilization % 7.2% 7.4% Transactions % 23.0% 27.2% Other revenues % 15.9% 10.6% Financing Unit % 10.8% 6.7% SNG % -6.8% -5.5% Contracts System (Sircof) % 23.3% 11.8% Market data and Development of Solutions % 28.5% 29.8% Other revenues % 44.3% 19.4% Deductions (56.1) (58.8) (48.3) (114.9) (96.1) -4.7% 15.9% 19.6% Net operating revenue % 17.2% 14.1% 3

4 Cetip s gross revenue from services totaled R$ million in 2Q15, up 5.3% and 17.0% when compared to 1Q15 and 2Q14, respectively. The Securities Unit had yet another strong quarter in 2Q15, with revenue growing 3.7% in comparison to 1Q15 and 20.3% over 2Q14, driven by: (i) expansion of bank deposit certificate s ( CDB ) transactions volume due to Circular 3709 ("3709"); (ii) strong demand for derivatives, especially those related to foreign exchange currency, and (iii) stock increase of assets in custody. The Financing Unit revenue grew 8.7% and 10.8% comparing quarter-on-quarter ( QoQ ) and year-over-year ( YoY ) results, respectively. This upward trend, in spite of the 5.5% reduction in the number of financed vehicles versus 1Q15 and of the 12.7% versus 2Q14, is explained by: (i) change in the registration of vehicles financing contracts model in São Paulo (for further details, refer to Financing Unit ); and, to a lesser extent, (ii) growth of market data and development of solutions revenue, when compared to the same quarter last year. Revenue deductions (taxes on services rendered and other deductions) decreased YoY and QoQ. This is due, mostly, to the fact that part of the revenue growth derived from the change in the registration of vehicles financing contracts model in the São Paulo state, which is not subject to discounts. In light of the above, Cetip s net revenue reached R$ million in 2Q15, 7.5% above 1Q15 and 17.2% higher than 2Q14. In 1H15, gross revenue totaled R$ million, recording a 15.0% growth over 1H14, as a result of a 19.5% increase in the Securities Unit gross revenue and of a 6.7% growth in the Financing Unit gross revenue. Net revenue, in turn, increased 14.1%, reflecting the growth of consolidated gross revenue and a 19.6% increase in revenue deductions, as the policy for progressive volume discounts in the Securities Unit and other discounts given by the Financing Unit exceeded the observed 2Q15 effect, as described above. 4

5 The graphs below show the breakdown of the key revenue lines that compose CETIP s gross operating revenue: 2Q15 Financing Unit: 33.2% / Securities Unit: 66.8% 2Q14 Financing Unit: 35.1% / Securities Unit: 64.9% Contracts System (Sircof) 15.0% SNG 12.4% Market data and Development of Solutions 5.5% Other revenues Market data and Other revenues (Financing Unit) Development of (Financing Unit) 0.3% Registration Solutions 0.3% Registration 8.1% Contracts System 5.1% 9.5% (Sircof) 14.2% Custody 27.7% SNG 15.6% Custody 23.7% Other revenues (Securities Unit) 6.9% Transactions 10.3% Monthly Utilization 13.8% Other revenues (Securities Unit) 6.9% Transactions 9.8% Monthly Utilization 15.1% Contracts System (Sircof) 13.8% Market data and Development of Solutions 5.7% 1H15 Financing Unit: 32.7% / Securities Unit: 67.3% Other revenues (Financing Unit) 0.3% Registration 8.7% Contracts System (Sircof) 14.2% Market data and Development of Solutions 5.1% 1H14 Financing Unit: 35.3% / Securities Unit: 64.7% Other revenues (Financing Unit) 0.3% Registration 9.8% SNG 12.9% Custody 27.1% SNG 15.8% Custody 23.2% Other revenues (Securities Unit) 6.7% Transactions 10.6% Monthly Utilization 14.1% Other revenues (Securities Unit) 7.0% Transactions 9.6% Monthly Utilization 15.1% SECURITIES UNIT Gross operating revenue from the Securities Unit totaled R$ million in 2Q15, registering an increase of 3.7% compared to 1Q15 and of 20.3% compared to 2Q14. Custody services were responsible for 41.5% of the total Securities Unit s gross revenue in the quarter, while monthly utilization accounted for 20.7%, transactions for 15.4%, registration for 12.1%, EFTs processed revenue (CIP) for 4.3%, repos, final transactions and trading platform for 4.4%, and other services provided totaled 1.6%. 5

6 I. Registration Revenues Registration revenues reached R$ 27.7 million in 2Q15, down 9.3% from 1Q15 as a result, mainly, of the decrease in revenues from registration of bank funding instruments (-11.2%), real estate market instruments (-16.7%), agribusiness instruments (-17.9%) and other fixed income instruments (-6.0%), in addition to OTC derivatives registration revenue decrease (-15.8%), and despite the increase of 38.4% from other registration services (Distribution, Correction and Pre- Registration). Registration revenue remained in line with 2Q14, as a result of the net effect from the growth in OTC derivatives registration revenues (+33.6%), the decrease in fixed income instruments registration revenue (-9.6%) and the decrease in revenue from other registration services (- 20.6%). Registration revenue in 1H15 totaled R$ 58.3 million, 2.0% higher than in 1H14, with a positive highlight for OTC derivatives registration. The main highlights from fixed income securities and OTC derivatives for 2Q15 are briefly described below: Fixed Income Instruments Fixed income instruments registration revenue totaled R$ 14.7 million in 2Q15, 12.1% lower than in 1Q15, due to: (i) the decrease in revenue from registration of banking funding instruments (-11.2%), which resulted from the reduction in revenues from the registration of CDBs, which was affected, among other factors, by the new pricing model, that reduced the original registration price and established a custody fee, implemented from March 2015 on, when Circular 3709 ("3709") became effective; (ii) the decrease in registration revenue from real estate market instruments which, after an issuance peak in January, returned to normalized levels; and (iii) reduction in revenue from agribusiness instruments, following the reduction of the average price charged for this service. Compared to 2Q14, fixed income securities registration revenue fell 9.6%, as a result of: (i) the decrease of revenue from bank funding instruments registration (-18.6%), especially given the new pricing model for the registration of CDBs, as mentioned above; (ii) the increase in registration revenue of real estate market instruments (+17.2%) and of agribusiness instruments (+7.3%); and (iii) other fixed income instruments revenue decrease (-5.8%). Revenue from fixed income instruments decreased 7.5% in 1H15, mainly due to lower revenue from registration of CDBs, which affected the P&L line of banking funding instruments registration (-19.6%). This scenario was partly offset by the growth in registration revenue of real estate instruments (+26.2%) and agribusiness instruments (+18.9%), which had registration volumes 22.7% and 47.1% higher, respectively. 6

7 OTC Derivatives Revenue from derivatives registration, which includes structured notes, reached R$ 9.6 million in 2Q15, 15.8% lower than 1Q15 due to smaller revenue from swaps registration. Comparing to 2Q14, revenue from derivatives registration grew 33.6%, as a result of an increase in the items that compose this revenue, notably forward contracts and other derivatives / structured notes. We highlight that the increase in the exchange rate volatility (R$ x US$) observed since 2H14 has contributed positively for the YoY comparisons for OTC derivatives registration volume. II. Custody Revenues Custody revenue totaled R$ 95.1 million in 2Q15, up 10.7% over 1Q15, due to: (i) new custody revenue from CDBs, which is responsible for almost all of the banking funding instruments custody revenue growth of 29.6%, compared to the previous quarter; and (ii) a 16.1% revenue expansion from permanence of OTC contracts and custody of structured notes. When compared to 2Q14, custody revenue was 37.1% higher, which can be explained mainly by: (i) the performance of fixed income instruments (revenue up +24.0%), especially banking funding instruments (+52.1%), driven by revenue growth from CDBs, as mentioned previously; and (ii) the OTC derivatives and structured notes performance (+84.2%), in which, over the past 12 months, can be observed both the growth of assets stock in custody as well as a higher average price, given a mix of products that are more complex and with more functionalities, besides a greater contribution from structured notes custody. In 1H15, fixed income instruments custody revenue totaled R$ million, up 21.3% over 1H14, as a result of a 22.5% increase in stock and an average margin drop of 1.0%. Revenue from derivatives permanence and structured notes custody grew 81.6% growth versus 1H14, while end users revenue increased 49.5% over the same period. III. Monthly Utilization Revenue Monthly utilization revenue totaled R$ 47.4 million in 2Q15, growing 0.8% over 1Q15, mainly as a result of the 0.6% increase in average margin. Compared to 2Q14, monthly utilization revenue went up 7.2%, due to the 1.7% increase in the average number of clients and the 5.4% expansion in the average margin, explained primarily by the annual price readjustment by the accumulated 2014 IGP-M (+3.7%). In the 1H15, monthly utilization revenue added up to R$ 94.4 million, 7.4% higher than 1H14, as a result of a 5.3% increase in the average margin as well as a 2.0%growth in the average number of clients. 7

8 IV. Transactions Revenue Transactions revenue reached R$ 35.2 million in 2Q15, down 1.6% over 1Q15, as a result of: (i) a 46.3% growth in the number of transactions processed, due to the increase in Cetip's depositary activity and the implementation of the 3709 regulation in March 2015; and (ii) a 32.7% drop in average margin, explained by clients using more intensely the lower price windows created in connection with the implementation of the 3709 regulation. As compared to 2Q14, transactions revenue grew 23.0%, driven by: (i) the increase of 117.7% in the total number of transactions processed, as highlighted above; and (ii) the decrease of 43.5% in the average margin per transaction, also explained by the implementation of the 3709 regulation. In 1H15, transactions revenue added to R$ 71.0 million, 27.2% higher than 1H14, justified by the 87.4% increase in the average daily number of transactions and the 32.1% drop in the average margin. V. Other Revenues from Services Other revenues from services related to the Securities Unit reached R$ 23.5 million in 2Q15, a 9.4% growth compared to 1Q15, as a result of: (i) revenue growth from repos, final transactions and trading platform (+11.2%); (ii) the increase in other revenues from services from the Securities Unit (+7.5%); and (iii) a 8.2% increase in revenue from electronic cash transfers (EFTs). The 8.2% increase in the revenue from electronic EFTs, which represents 42.3% of other services revenue from the Securities Unit, was a consequence of: (i) the 10.3% growth in number of EFTs processed, due, among other factors, to the reduction of EFTs minimum ticket, from R$ 750 to R$ 500; and (ii) the 1.9% decrease in average margin, reflecting the higher volume processed during the quarter, intensifying the effect of progressive volume discounts, that are part of the EFTs processing pricing structure. When compared to 2Q14, revenue from electronic EFTs increased 18.4%, due to: (i) the 8.1% reduction in average margin, reflecting the new price range in effect from March 2014 until February 2016, that defines a pricing structure nominally lower than the one in place from March 2012 until February 2014 and the contractual pricing policy that defines prices according to bands of volume; and (ii) the 28.9% increase in the number of EFTs processed, influenced by the lower minimum ticket, which was reduced from R$ 1,000 to R$ 750 in the beginning of July, 2014 and from R$ 750 to R$ 500 in January

9 FINANCING UNIT Gross operating revenue from the Financing Unit totaled R$ million in 2Q15, an increase of 8.7% compared to 1Q15, and of 10.8% over 2Q14. SNG revenue accounted for 37.3% of the Unit s total gross revenue in the quarter, Contracts System (previously known as Sircof) represented 45.0%, market data and development of solution, 16.7% and other revenues from services, 1.0%. The table below details selected operating data from the Financing Unit: Revenue (R$ million) 2Q15 1Q15 2Q14 1H15 1H14 Change 2Q15/1Q15 Change 2Q15/2Q14 Change 1H15/1H14 SNG % -6.8% -5.5% Contracts System % 23.3% 11.8% SNG ('000) Number of vehicles sold ( 000) 4,310 4,154 4,351 8,464 8, % -0.9% -1.7% New 1,007 1,047 1,254 2,053 2, % -19.7% -17.1% Used 3,304 3,107 3,096 6,411 6, % 6.7% 4.6% Number of vehicles financed ('000) 1,318 1,394 1,510 2,712 3, % -12.7% -10.6% New ,216 1, % -22.8% -19.5% Used ,496 1, % -2.3% -1.9% % Vehicles financed / vehicles sold 30.6% 33.6% 34.7% 32.0% 35.3% -3.0 p.p p.p p.p. Contracts System ('000) Contracts Additions ('000) ,008 1,897 1, % -8.7% -2.9% % Contracts additions / vehicles financed 69.8% 70.0% 66.8% 69.9% 64.4% -0.2 p.p. 3.0 p.p. 5.5 p.p. Sources: Fenabrave and Cetip I. SNG 2Q15 SNG revenue totaled R$ 42.5 million, down 3.4% when compared to 1Q15, due to a 5.5% decrease in the number of financed vehicles (-5.3% for new vehicles and -5.6% for used vehicles), which was partially offset by the contribution of deferred revenue from previous quarters. The relative poorer performance of new vehicles sales, which shrank 3.8% compared to previous quarter versus a 6.3% increase in sales of used vehicles, has a negative mix effect on the financing contracts penetration rate (percentage of financed vehicles over total vehicles sold), since used vehicles tend to be paid in cash more often. Compared to 2Q14, the SNG revenue was down 6.8%, as result of the 12.7% drop in the number of vehicles financed, with a 4.1 p.p. decline in the ratio of vehicles financed over vehicles sold, which decreased from 34.7% in 2Q14 to 30.6% in 2Q15, and a 0.9% drop in the total number of vehicles sold. The revenue impact of a lower number of financed vehicles was partially offset by: (i) the annual price adjustment of 3.7% based on the IGP-M; and (ii) the contribution of deferred revenue from previous quarters. In 1H15, the SNG revenue totaled R$ 86.5 million, down 5.5% over 1H14 for the same reasons aforementioned in the comparison to 2Q14. 9

10 It is worth remembering that, in 2014, to ensure the proper application of accounting principles to revenue recognition, the Company revisited the treatment given to the SNG revenue, and began recognizing part of the revenue at the time of the financial constraint insertion and the remaining portion over the period in which such restriction remained registered, up until its retirement, no longer recognizing revenue fully at the time of insertion, as previously adopted criteria. This review resulted in a liability recognition, composed by revenues already received but that were deferred to future periods, as well as it attributable tax impacts, offset by an increase in the goodwill value related to the acquisition of GRV in II. Contracts System (previously called Sircof) Revenue from the registration of vehicles financing contracts system (previously called Sircof) reached R$ 51.3 million in 2Q15, 25.7% higher than in 1Q15 and 23.3% higher than in 2Q14, in spite of the decrease in the number of registered contracts in the comparison against both periods. The main reason for this increase is the modification of São Paulo s Traffic Department (Detran São Paulo) rules, which caused changes to the revenues and costs related to this service. Since April 15, 2015, when the new rules of the Detran São Paulo came into effect, the Company began recognizing the revenue as the full price charged to the banks. On the other hand, the public price charged by the Detran São Paulo, as well as Fenaseg s revenue share in this service, became operating expenses related to this service. So, there was a concurring increase in revenues and operating expenses, which, by itself, would result in a decrease in the Company s margin. In addition, there was also a decrease in the nominal margin per contract, since Cetip absorbed the larger participation of Detran-São Paulo on the new model s total fee, as the final price charged to the banks for the service was unaltered. The table below isolates the effect from new costs related to the contracts system in São Paulo, in order to maintain the comparability of revenue data. The analysis of the impact of these new costs in the Company s operating expenses can be examined at Adjusted Operating Expenses. (R$ million, except where noted) 2Q15 1Q15 2Q14 1H15 1H14 It can be observed that the revenue from the contracts system, adjusted to exclude the impact of new costs related to São Paulo s service, decreased 11.0% and 12.7% when compared to 1Q15 and 2Q14, respectively. This reduction is explained mostly by: (i) the nominal margin loss per contract for São Paulo registrations, as previously detailed; (ii) the increase of Cetip I Contratos penetration, whose average margin is lower than the traditional model s; and (iii) the 5.7% and 8.7% decrease in the number of contracts inclusions versus the 1Q15 and 2Q14, respectively. On the other hand, the 8.7% reduction in the number of contracts registered, in comparison to 2Q14, was smaller than the drop in the number of vehicles financed during the same period, as a consequence of the 3.0 p.p. growth in the ratio of contracts registered over total number of financing contracts (product penetration), from 66.8% in 2Q14 to 69.8% in 2Q Change 2Q15/1Q15 Change 2Q15/2Q14 Change 1H15/1H14 Gross Revenue from Contracts System Contracts inclusions (thousands of contracts) ,008 1,897 1, % -8.7% -2.9% Gross Revenue % 23.3% 11.8% (-) Adjustments of New Costs related to the Contracts System in São Paulo N/A N/A N/A Adjusted Gross Revenue % -12.7% -6.4%

11 In 1H15, the contracts system adjusted revenue totaled R$ 77.1 million, 6.4% lower than in 1H14, as a consequence of the same factors pointed out in the quarterly comparisons. III. Market Data and Development of Solutions The revenue from market data and development of solutions totaled R$ 19.0 million in 2Q15, reaching the same level as in 1Q15, mainly due to: (i) drop in revenues related to Cetip Infoauto, Infoauto Pagamentos and Cetip Panorama, which is explained by the lower volume of financings, since the revenue from these products is directly linked to the number of financed units; and (ii) growth in revenues from Cetip Performance and Cetip Auto Relatórios. Compared to 2Q14, the market data and development of solutions revenue grew 28.5%, mainly due to the performance of revenues from Cetip Performance and Infoauto Pagamentos. In 1H15, market data and development of solutions revenue reached R$ 38.1 million, up 29.8% over 1H14, for the same reasons that explain the delta between 2Q15 and 2Q14. ADJUSTED OPERATING EXPENSES Change Change Change (R$ million) 2Q15 1Q15 2Q14 1H15 1H14 2Q15/1Q15 2Q15/2Q14 1H15/1H14 Personnel¹ (45.1) (43.7) (40.4) (88.8) (79.8) 3.0% 11.6% 11.3% Outsourced services (39.4) (22.3) (20.3) (61.8) (41.9) 76.6% 94.6% 47.6% New cost related to Contracts System in São Paulo (15.0) - - (15.0) Others (24.5) (22.3) (20.3) (46.8) (41.9) 9.5% 20.7% 11.8% General and administrative expenses (10.2) (8.4) (9.6) (18.6) (18.4) 21.2% 6.7% 0.9% Expenses incurred on equipment and system rental (0.8) (1.0) (0.6) (1.8) (1.3) -23.5% 22.0% 34.7% Taxes and fees (0.3) (0.3) (0.4) (0.7) (0.8) 8.9% -14.3% -14.5% Other expenses/revenues (0.1) (0.1) (0.0) (0.1) % N.D % TOTAL Adjusted Operating Expenses (95.9) (75.9) (71.3) (171.8) (142.0) 26.3% 34.5% 21.0% Share based incentive (4.9) (5.0) (4.6) (10.0) (7.3) -1.3% 7.0% 37.2% Depreciation and amortization (21.5) (21.6) (20.4) (43.1) (40.5) -0.7% 5.1% 6.4% TOTAL Operating Expenses (122.3) (102.5) (96.4) (224.8) (189.7) 19.3% 26.9% 18.5% (-) New cost related to Contracts System in São Paulo TOTAL Operating Expenses excluding New cost related to Contracts System in São Paulo (15.0) - - (15.0) (107.3) (102.5) (96.4) (209.8) (189.7) 4.7% 11.3% 10.6% 1)Personnel include expenses with board members and advisory committees The adjusted operating expenses amounted R$ 95.9 million in 2Q15, 26.3% higher than 1Q15, as a result of: (i) (ii) (iii) an increase of 76.6% in the outsourced services expense line, which is directly affected by the new contracts system model in São Paulo. The new costs related to the new São Paulo model accounted for R$ 15.0 million of the total increase of R$ 17.2 million in the quarter (for further details, refer to Financing Unit Contracts System ); a 21.2% growth in general and administrative expenses, mainly due to one-time expenses related to events promoted by the Company; and a 3.0% expansion in personnel expenses. 11

12 In comparison with 2Q14, adjusted operating expenses grew 34.5%, as a consequence of: (i) a 94.6% increase in outsourced services expenses, mainly due to the contracts system in São Paulo new model and, to a lesser extent, higher expenses with auditors, consultants and lawyers; and (ii) the 11.6% increase in personnel expenses, mainly due to headcount increase and salary readjustments. In 1H15, adjusted operating expenses amounted to R$ million, up 21.0% over 1H14. Excluding the new costs related to the contracts system in São Paulo, operational expenses in 1H15 grew 10.6% when compared to 1H14, in line with Company s 11.0% net revenues growth, also adjusted to exclude the impact of the same costs, during the same period. Allocating the Company s expenses among those which are variable, i.e. directly linked to revenue, and other operating expenses, it is evidenced that the increase in operating expenses was caused by higher business activity. (R$ million, except where noted) 2Q15 1Q15 2Q14 1H15 1H14 Change Change Change 2Q15-1Q15 2Q15-2Q14 1H15-1H14 Operating Expenses % 26.9% 18.5% Operating Expenses directly linked to Revenue % 144.2% 79.3% % of TOTAL Operating Expenses 22.2% 11.2% 11.5% 17.2% 11.3% Other Operating Expenses % 11.7% 10.7% % of TOTAL Operating Expenses 77.8% 88.8% 88.4% 82.8% 88.7% Variable Operating Expenses % 144.2% 79.3% (-) New Costs related to the Contracts System in São Paulo (15.0) - - (15.0) - Operating Expenses directly linked to Revenue Excl. New Costs related to the Contracts System in São Paulo % 9.3% 9.7% FINANCIAL RESULT Net financial result was R$ 15.0 million positive in 2Q15, R$ 65.9 million above the R$ 50.9 negative result achieved in 1Q15. This variation is the net effect of: (i) a R$ 30.8 million decrease in financial income, which registered no gain from the swap transaction to neutralize the FX exposure related to the domestic bank loan obtained (which amounted to R$ 50.3 million in 1Q15), but, on the other hand, accounted for a R$ 21.0 million gain from exchange rate variation on offshore loans; and (ii) a R$ 96.6 million drop of in financial expenses in 2Q15, mostly from the absence of FX losses related to the Company s offshore loan, which had a R$114.4 million impact on 1Q15 s results, and from R$11.5 million mark-to-market ( MtM ) losses related to the Company s domestic bank loan plus R$ 4.9 million swap losses. Compared to 2Q14, the financial result showed an increase of R$ 19.8 million compared to a negative result of R$ 4.9 million recorded in the same quarter of The net financial result variation observed between the analyzed periods is a consequence, mostly, of: (i) a R$ 38.1 million financial income increase, impacted by FX gains related to the Company s offshore loans (+R$ 47.3 million); and (ii) a R$ 18.3 million growth in financial expenses, influenced by losses from MtM of the domestic bank loan (-R$ 11.5 million) and the swap loss (-R$ 4.9 million) in 2Q15. It is worth to highlight that, currently, the Company has, in its consolidated balance sheet, two debt instruments in foreign currency: (i) a bilateral domestic loan in accordance to the Law, totaling US$ million, whose FX risk is hedged by a swap contract; and (ii) a US$

13 million loan acquired by an offshore subsidiary. As for the latest, despite not having a hedging contract in place, the Company does not incur exchange rate risk, as explained later in the income taxes and social contribution topic. The table below isolates the impact of exchange rate fluctuations related to the offshore loan and the offshore investment, both in Cetip s financial result as well as in its income tax and social contribution expense, as to allow a better comparison basis for the analysis of the Company s financial result evolution: Change Change Change (R$ million, except where noted) 2Q15 1Q15 2Q14 1H15 1H14 2Q15-1Q15 2Q15-2Q14 1H15-1H14 Net Financial Result 15.0 (50.9) (4.9) (35.9) (10.6) (25.4) (+/-) Hedge effect on Financial Results (11.0) (68.6) (11.0) 46.6 Adjusted Financial Result (excluding hedge effect) (4.9) 10.7 (10.6) (2.8) Income before tax and social contribution (+/-) Hedge effect on Financial Results (11.0) (68.6) (11.0) 46.6 Income before tax and social contribution (excluding hedge effect) - (A) (2.5) Tax and social contribution expense (61.0) 7.3 (43.2) (53.7) (84.0) (68.3) (17.8) 30.3 (+/-) Hedge effect on Tax and social contribution 11.0 (57.6) - (46.6) (46.6) Adjusted Tax and social contribution expense (excluding hedge effect) - (B) (50.0) (50.3) (43.2) (100.3) (84.0) 0.4 (6.8) (16.3) % Effective tax rate on adjusted Income before tax and social contribution - (B) / (A) 29.6% 29.4% 30.1% 29.5% 29.5% INCOME TAX AND SOCIAL CONTRIBUTION In 2Q15, Cetip's income tax and social contribution expense (tax or taxes) was R$ 61.0 million, compared to the tax savings of R$ 7.3 million in 1Q15 and the tax expense of R$ 43.2 million in 2Q14, with an effective tax rate of 34.0% in 2Q15, compared to -6.4% and 30.1% in 1Q15 and 2Q14, respectively. The delta on tax rates is almost completely explained by currency exchange rate fluctuations related to our foreign subsidiary and offshore loan. The FX rate variation on the capital invested in our subsidiary abroad is nontaxable, while exchange rate gains/losses over our offshore loan are. As showed in the previous table, the tax impact over exchange rate gains/losses neutralizes the exchange rate impact over financial expenses/ income, which means that there is no currency exposure for Cetip after taxes. The table below shows the reconciliation of the effective cash tax for the periods below: (R$ million) 2Q15 1Q15 2Q14 1H15 1H14 Income before income tax and social contribution Income tax and social contribution (61.0) 7.3 (43.2) (53.7) (84.0) % Effective tax rate 34.0% -6.4% 30.1% 18.3% 29.5% (+) Tax credit (goodwill amortization) (=) IR+CSLL (cash) (47.1) 21.2 (25.5) (26.0) (48.6) % Effective tax rate (cash basis) 26.2% -18.6% 17.8% 8.9% 17.0% 13

14 ADJUSTED EBITDA AND ADJUSTED NET INCOME (CASH EARNINGS) In 2Q15, adjusted EBITDA totaled R$ million, in line with 1Q15 s result and 10.1% higher than the same period last year. Adjusted EBITDA margin reached 66.6% in 2Q15, decreasing 4.9 p.p. over 1Q15 and 4.3 p.p. over 2Q14. In 1H15, adjusted EBITDA reached R$ million, 11.3% higher than 1H14, with an EBITDA margin of 69.0%. The table below details the EBITDA and Adjusted EBITDA calculation: Change Change Change Adjusted EBITDA reconciliation (R$ million) 2Q15 1Q15 2Q14 1H15 1H14 2Q15/1Q15 2Q15/2Q14 1H15/1H14 NET INCOME % 18.3% 19.1% (+) Income tax and social contribuition 61.0 (7.3) % 41.1% -36.0% (+) Depreciation and amortization % 5.1% 6.4% (-) Financial income net of financial expenses (15.0) % % 239.6% EBITDA % 10.3% 10.7% (+) Share based incentive without cash disbursement % 7.0% 37.2% (+/-) Equity in net income of affiliate company (0.2) (0.2) 0.0 (0.4) (0.2) 49.7% N.A. 55.8% ADJUSTED EBITDA % 10.1% 11.3% ADJUSTED EBITDA MARGIN 66.6% 71.5% 70.9% 69.0% 70.7% -4.9 p.p p.p p.p. 1 Considers the methodology for calculating EBITDA and adjusted EBITDA, according to CVM Instruction 527 as of 10/04/2012. The EBITDA margin pressure was mainly due to the leveraging of the Company's income statement in connection with the new model for registration of vehicles financing contracts in the state of São Paulo this effect, by itself, caused a decrease of 3.7 p.p. in 2Q15 EBITDA margin, as shown below. (R$ million, except where noted) 2Q15 1Q15 2Q14 1H15 1H14 Change Change Change 2Q15-1Q15 2Q15-2Q14 1H15-1H14 Services Net Revenue % 17.2% 14.1% Adjusted EBITDA % 10.1% 11.3% Adjusted EBITDA margin 66.6% 71.5% 70.9% 69.0% 70.7% -499 bps -430 bps -177 bps Net Revenue - New Costs related to the Contracts System in São Paulo % 11.0% 11.0% Adjusted EBITDA % 10.1% 11.3% Adjusted EBITDA margin 70.2% 71.5% 70.9% 70.8% 70.7% -132 bps -63 bps 12 bps Impact on Adjusted EBITDA consolidated margin -367 bps -189 bps 14

15 Adjusted net income (cash earnings) reached R$ million in 2Q15, 1.4% lower than in 1Q15 and 10.9% higher than in 2Q14, performance explained by the EBITDA in the comparison periods. Adjusted net margin reached 52.5% in 2Q15, 4.7 p.p. and 2.9 p.p. lower than 1Q15 and 2Q14, respectively. In 1H15, cash earnings reached R$ million, 13.4% higher than 1H14, and net margin was 54.8%. Adjusted net income reconciliation (R$ million) 2Q15 1Q15 2Q14 1H15 1H14 Change 2Q15/1Q15 Change 2Q15/2Q14 Change 1H15/1H14 NET INCOME % 18.3% 19.1% (+) Share based incentive without cash disbursement % 7.0% 37.2% (+) Goodwill amortization acquisition GRV¹ % 0.0% 0.0% (+) Tax benefit from goodwill amortization² % -21.6% -21.6% ADJUSTED NET INCOME (cash earnings) % 10.9% 12.4% ADJUSTED NET INCOME MARGIN 52.5% 57.2% 55.4% 54.8% 55.6% -4.8 p.p p.p p.p. ADJUSTED NET INCOME PER SHARE (cash EPS)³ % 10.6% 11.8% 1 Amortization of intangible assets (contractual relationships) related to the acquisition of GRV in the amount of R$ 13.0 million per quarter, from 1Q11 until 2Q28, accounted as depreciation and amortization expenses; 2 Tax benefit due to: i) the goodwill related to the acquisition of GRV in the amount of R$ 13.9 million per quarter, from 1Q11 until 4Q15; ii) the goodwill related to the incorporation of Advent Depository in the amount of R$ 3.3 million per quarter until 4Q12 and R$ 3.8 million per quarter from 1Q13, beginning in October 2009 until October 2014; and 3 Calculation of adjusted earnings per share based on the weighted average number of shares in the period. OPERATING CASH FLOW AND INDEBTEDNESS 2Q15 Cetip s cash flow from operations before taxes and before the allocation of excess cash for investments totaled R$ million, an increase of 13.5% versus 1Q15 and of 28.0% versus 2Q14, as a result of very resilient and well diversified revenue flow. The cash flow from investment activities amounted to R$ 13.7 million in the quarter, whereas the cash flow from financing activities was negative in R$ million, influenced by the payment of dividends and interest on own capital (R$ million) and the share buyback program (R$ 54.0 million). As a result of these movements, the cash and cash equivalents balance was practically unchanged during the quarter. At the end of 2Q15, Cetip s gross short and long-term debt (debentures, loans, financial leases) totaled R$ 1.2 billion, while derivatives added to cash, cash equivalents and marketable securities amounted R$ 1.0 billion. Thus, the net debt of the Company was R$ million on, R$ 62.8 million than at the end of 2Q14. The net debt to the last 12 months adjusted EBITDA ratio was 0.2 times at the end of 2Q15, and the financial leverage ratio (net debt / total capital) reached 7.8%, showing the Company s solid financial position. 15

16 The table below shows the reconciliation of the Company s net debt and the related debt metrics as of 2Q15, 1Q15 e 2Q14: (R$ miillion) 2Q15 1Q15 2Q14 Var. 2Q15/1Q15 Var. 2Q15/2Q14 Debentures issued % -6.3% Borrowings and finance lease obligations % % Total Gross Debt 1, , % 104.9% Derivative financial instruments (45.4) (50.3) % - Cash + non restricted financial investments* (964.4) (962.1) (355.9) 0.2% 171.0% Net Debt % -30.3% Shareholders equity 1, , , % 3.4% Total Capital 1, , , % -0.4% EBITDA (Last twelve months ) % 11.1% Adjusted EBITDA (Last twelve months ) % 11.1% Net Debt / EBITDA 0.2X 0.2X 0.3X 0.0X -0.1X Net Debt / Adjusted EBITDA 0.2X 0.2X 0.3X 0.0X -0.1X Financial Leverage Index (Net Debt/Total Capital) 7.8% 6.8% 11.2% 1.0 p.p p.p. * Net of R$ 56.9 million in 2Q15, R$ 55.4 million in 1Q15, anda R$ 50.9 million in 2Q14, referring to investments that constitute CETIP's special property and are recorded in a blocked account in the Special Settlement and Custody System - SELIC. INVESTMENTS Cetip s total investments ( CAPEX ) totaled R$ 13.7 million in 2Q15, which is equivalent to 4.8% of the net revenues in the period, up 2.0% over 1Q15, and 24.3% up on 2Q14. 2Q15 Cetip s CAPEX was divided as follows: (i) 66.9% for development of products; (ii) 26.4% for maintenance and expansion of capacity; and (iii) 6.7% for offices settlement. The 2Q15 development CAPEX was allocated mainly among the following products: (i) CCP; (ii) Cetip Contratos; (iii) Structured Notes (COE); (iv) Depositary; (v) Electronic Formalization; (vi) Liens on financial instruments; (vii) Real Estate; and (viii) EFT reduction to a zero value. The office settlement investments, in connection with relocating the teams from Santana do Parnaíba, Rio de Janeiro and São Paulo (partly) to the new site in Barueri, were responsible for this CAPEX line item growth in 2Q15, as compared to the same quarter in SHARES PERFORMANCE (CTIP3) At the end of 2Q15, Cetip s shares were quoted at R$ 34.08, an appreciation of 9.6% over the end 1Q15, performance compared with the 3.8% increase in Bovespa Index (Ibovespa) for the same period. Since June 30, 2014, Cetip s share price increased 13.4%, compared to a 0.2% decrease in the Ibovespa for the same period. Cetip s shares average daily trading volume reached R$ 47.8 million in 2Q15, maintaining the same level of 2Q14. On, Cetip s market value was R$ 8.9 billion. 16

17 CTIP3 vs. Ibovespa: 06/30/2014 until 06/30/ Jun-14 Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14 Jan-15 Feb-15 Mar-15 Apr-15 May-15 Jun-15 Volume (R$ million) CTIP3 Ibovespa Source: Bloomberg. Historical values adjusted by corporate actions Amounts in R$, except when otherwise indicated 2Q15 2Q14 Quote at the start of the period Maximum Average Minimum Quote at the end of the period Daily average volume (R$ million) Number of shares (thousands)¹ 261, ,165 ¹ Number of shares at the end of the periods Source: Bloomberg. Historical values adjusted by corporate actions Stock Turnover (annualized rate) 2Q15 2Q14 Number of shares traded (thousands) 85,980 98,867 Average weighted no. of shares (thousands) 261, ,005 Number of trading days Number of trading days in the year ¹ Annualized turnover (%) 132% 157% ¹ Source: BM&FBOVESPA Estimated number of trading days for 2015 Source: Bloomberg DIVIDENDS, INTEREST ON SHAREHOLDERS EQUITY AND SHARE BUYBACK On June 19, 2015, Cetip s Board of Directors approved the payment of interest on shareholder s equity for 2Q15 in the amount of R$ 22.8 million, equal to R$ gross per share, to be paid on August 10, Additionally, the Board of Directors approved on August 05, 2015 the additional distribution of R$ 78.1 million (R$ per share) in the form of interim dividends, 17

18 to be paid on October 08, Thus, the total distribution of interim dividends and interest on own capital for 2Q15 will reach R$ million, equal to 85.0% of the results for the period. At a meeting held on March 04, 2015, the Board of Directors also approved the Company's Second Share Buyback Program, starting on the approval date and ending on March 03, The limit of shares that may be acquired by Cetip is 5,400,000 common shares, which represented 2.13% of the total outstanding shares in the market. By, Cetip had bought back 2,291,500 shares, at a total cost of R$ 74.9 million, reinforcing the Company's commitment to creating value for its shareholders. CORPORATE GOVERNANCE CETIP is committed to the highest standards of corporate governance. In addition to adhering to the Novo Mercado rules, CETIP maintains solid auto-regulation practices according to the provisions of CVM Instruction no. 461, which regulates the functioning of organized securities markets. Companies listed on the Novo Mercado voluntarily agree to comply with stricter rules than those of Brazilian corporate law, such as: (i) maintain only common shares in their capital stock; (ii) maintain a minimum of 25% free float; (iii) detail and include additional quarterly information; (iv) the Board of Directors must be composed of at least five members, with at least 20% of independent members and the maximum two years term; and (v) in the case of sale of control all shareholders are entitled to sell their shares at the same price (100% tag along). Note that some provisions of the Bylaws of CETIP goes beyond the established requirements in the Novo Mercado. ADHESION TO THE MARKET ARBITRATION CHAMBER The Company joined the Market Arbitration Chamber, as per the clause in its Bylaws. This body, created by the Stock Exchange, arbitrates disputes and controversies that may exist between the controlling shareholders of companies listed on the Novo Mercado and shareholders in general, managers, members of Fiscal Council and the exchange itself. 18

19 RELATIONSHIP WITH INDEPENDENT AUDITORS Our policy on the engagement of our independent auditors in non-audit related services is based on the principles and regulations generally applied to preserve the independence of the auditor. These principles are: (a) the auditor should not audit its own work, (b) the auditor should not perform management functions for its clients, and (c) the auditor should not promote the interests of its client. During the quarter ended on, there were no further services with a term of less than one year, with the independent auditors and parties related to them, on an individual or cumulative level in excess of 5% of the total external audit fees. MANAGEMENT STATEMENT As per the provisions in CVM Instruction no. 480/09, the Management declares that it has discussed, reviewed and agreed with the interim financial statements relative to the quarter ended on and agreed with the opinions expressed in the independent auditors report regarding the review of the interim financial statements. The Management Rio de Janeiro, August 5,

20 (A free translation of the original in Portuguese) Independent auditors review report on condensed interim financial statements The Board of Directors and Shareholders CETIP S.A. Mercados Organizados Introduction We have reviewed the accompanying parent company and consolidated condensed interim balance sheet of Cetip S.A. - Mercados Organizados (the "Company") as at and the related condensed parent and consolidated statements of income, comprehensive income and cash flows for the quarter and six-month periods then ended, and the condensed statements of changes in equity for the six-month period then ended, as well as the accompanying summary of significant accounting policies and other explanatory information. Management is responsible for the preparation of the parent company and consolidated condensed interim financial statements in accordance with accounting standard CPC 21, Interim Financial Reporting, of the Brazilian Accounting Pronouncements Committee (CPC) and International Accounting Standard (IAS) 34 - Interim Financial Reporting, of the International Accounting Standards Board (IASB). Our responsibility is to express a conclusion on these condensed interim financial statements based on our review. Scope of review We conducted our review in accordance with Brazilian and International Standards on Reviews of Interim Financial Information (NBC TR Review of Interim Financial Information Performed by the Independent Auditor of the Entity and ISRE Review of Interim Financial Information Performed by the Independent Auditor of the Entity, respectively). A review of interim financial statements 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 Brazilian and International Standards on Auditing and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion. Conclusion on interim financial statements Based on our review, nothing has come to our attention that causes us to believe that the accompanying parent company and consolidated condensed interim financial statements referred to above has not been prepared, in all material respects, in accordance with CPC 21, Interim Financial Reporting, of the Brazilian Accounting Pronouncements Committee (CPC) and IAS 34 - Interim Financial Reporting, of the International Accounting Standards Board (IASB). 20

21 Other matters Condensed statements of value added We have also reviewed the parent company and consolidated condensed statements of value added for the quarter and six-month period ended. These statements are the responsibility of the Company's management, and are presented as supplementary information. These statements have been subjected to the same review procedures described above and, based on our review, nothing has come to our attention that causes us to believe that they are not prepared, in all material respects, in a manner consistent with the condensed interim financial statements taken as a whole. Rio de Janeiro, August 5, 2015 PricewaterhouseCoopers Auditores Independentes CRC 2SP000160/O-5 "F" RJ Luiz Antonio Fossa Contador CRC 1SP196161/O-8 "S" RJ 21

22 CETIP S.A. - Mercados Organizados Balance sheets In thousands of reais (A free translation of the original in Portuguese) CETIP Consolidated CETIP Consolidated Assets Notes 06/30/ /31/ /30/ /31/2014 Liabilities and shareholders' equity Notes 06/30/ /31/ /30/ /31/2014 Current 951, , , ,930 Current 274, , , ,225 Cash and cash equivalents Suppliers 27,269 22,953 27,799 23,496 Financial investments - non restricted 4 815, , , ,349 Labor obligations and social charges 8 49,207 56,296 49,418 56,682 Accounts receivable 99, , , ,735 Taxes payable 9 15,437 14,754 15,566 14,902 Recoverable taxes and contributions 10,609 16,642 13,372 17,431 Income tax and social contribution 8,211-12,873 2,181 Prepaid expenses 8,787 7,783 8,801 7,784 Dividends and interest on own capital payable 101,365 80, ,365 80,130 Other receivables 16,375 18,076 16,415 18,080 Debentures issued 11 19,524 17,427 19,524 17,427 Loans and finance lease obligations 11 4,658 3,923 3,201 2,608 Non-current 3,014,983 2,839,928 2,322,918 2,257,609 Deferred revenues 41,633 42,754 41,633 42,754 Other liabilities 7, , Long-term receivables 216, , , ,944 Financial investments - non restricted and restricted 4 165, , , ,197 Non- current 1,986,924 1,564,476 1,335,865 1,012,361 Derivatives 21b,d 45,415-45,415 - Suppliers 2,195 2,073 2,195 2,073 Judicial deposits Deferred income tax and social contribution 18a 158, , , ,785 Prepaid expenses 3,888 5,526 3,888 5,526 Provision for contingencies and legal obligations 10d 4,675 4,536 4,675 4,536 Other receivables 1,995 2,084 1,995 2,084 Debentures issued , , , ,175 Loans and finance lease obligations 11 1,284, , , ,153 Investments 737, ,852 6,588 6,211 Deferred revenues 38,631 40,639 38,631 40,639 Investment in subsidiaries 5a 730, , Investment in associate 5b 5,555 5,178 5,555 5,178 Shareholders equity 1,705,020 1,745,953 1,705,020 1,745,953 Other investments 1,033 1,033 1,033 1,033 Capital 12a 658, , , ,937 Capital reserves 12c 525, , , ,821 Property and equipment 6 51,155 49,903 51,181 49,931 Carrying value adjustments (750) (413) (750) (413) Income reserves 12d,e 464, , , ,715 Intangible assets 7 2,009,401 2,025,229 2,048,223 2,065,523 Treasury shares 12b (56,750) - (56,750) - Retained earnings 114, ,004 - Additional dividends proposed 12f - 111, ,893 Total assets 3,966,632 3,548,710 3,319,649 2,998,539 Total liabilities and shareholders' equity 3,966,632 3,548,710 3,319,649 2,998,539 The accompanying notes are an integral part of these condensed interim financial statements. 22

23 CETIP S.A. - Mercados Organizados Statements of income Quarters and six-month period ended June 30 (A free translation of the original in Portuguese) Accumulated Accumulated Accumulated Accumulated Notes 2Q Q Q Q Net revenue from services , , , , , , , ,007 CETIP Consolidated (Operating expenses)/other operating income (119,714) (219,666) (93,966) (185,048) (122,293) (224,813) (96,340) (189,676) Personnel expenses (44,074) (86,829) (39,371) (77,913) (44,548) (87,745) (39,840) (78,741) Share-based incentives with no cash disbursement 20c (4,946) (9,955) (4,622) (7,257) (4,946) (9,955) (4,622) (7,257) Depreciation and amortization 6 e 7 (20,720) (41,593) (19,673) (38,989) (21,457) (43,067) (20,409) (40,463) Outsourced services 15 (38,101) (59,076) (19,122) (39,581) (39,441) (61,778) (20,264) (41,853) General and administrative expenses 16 (10,172) (18,564) (9,532) (18,197) (10,197) (18,613) (9,556) (18,245) Equipment and systems leases (781) (1,802) (725) (1,438) (781) (1,802) (725) (1,438) Board members' compensation (516) (1,050) (522) (1,068) (516) (1,050) (522) (1,068) Taxes and fees (339) (650) (396) (761) (342) (656) (399) (767) Other operating expenses (88) (201) (55) (71) (88) (201) (55) (71) Other operating income Equity in the results of associate 5 (14,125) 108,648 3,560 7, (2) 242 Financial result 17 31,886 (138,968) (5,226) (11,198) 14,966 (35,932) (4,859) (10,580) Financial income 72, ,892 13,252 26,020 51, ,236 13,621 26,641 Financial expenses (40,734) (292,860) (18,478) (37,218) (36,772) (170,168) (18,480) (37,221) Income before taxation 177, , , , , , , ,993 Income tax and social contribution (58,633) (48,974) (42,375) (82,341) (60,996) (53,712) (43,219) (83,977) Current 18c (42,108) (86,914) (30,627) (59,144) (44,448) (91,603) (31,471) (60,780) Deferred 18a (16,525) 37,940 (11,748) (23,197) (16,548) 37,891 (11,748) (23,197) Net income for the period 118, , , , , , , ,016 Net income per share attributable to CETIP's 13 Basic earnings per share Diluted earnings per share The accompanying notes are an integral part of these condensed interim financial statements. 23