Cosan S.A. Indústria e Comércio. Consolidated interim financial statements at September 30, 2017 (A free translation of the original in Portuguese)

Transcription

1 interim financial statements at (A free translation of the original in Portuguese)

2 interim financial statements ended at Contents Review report on the interim financial statements ITR... 3 statement of financial position... 5 statements of profit or loss and other comprehensive income... 7 statements of other comprehensive income... 7 statements of changes in shareholders equity statements of cash flows statements of value added Notes to the consolidated interim financial statements Report on Review of Interim Financial Information To the Management, Board of Directors and Shareholders of 67

3 São Paulo - SP Introduction We have reviewed the accompanying individual and consolidated interim financial information of Cosan S.A. Indústria e Comércio ( Company ), contained in the Quarterly Information Form - ITR for the quarter ended, which comprise the balance sheet as of and the related statements of profit and loss and comprehensive income for the three and ninemonth periods then ended and changes in shareholders equity and cash flows for the nine-month period then ended, including the notes. The Company s management is responsible for the preparation of these interim financial information in accordance with the Technical Pronouncement CPC 21 (R1) - Demonstração Intermediária and IAS 34 - Interim Financial Reporting, issued by the International Accounting Standards Board - IASB, as well as for the presentation of these information in a manner consistent with the standards issued by Comissão de Valores Mobiliários, applicable to the preparation of Quarterly Information - ITR. Our responsibility is to express a conclusion on these interim financial information based on our review. Scope of review We conducted our review in accordance with Brazilian and International standards for review of interim financial information (NBC TR Revisão de Informações Intermediárias Executada pelo Auditor da Entidade and ISRE Review of Interim Financial Information Performed by the Independent Auditor of the Entity, respectively). A review of interim financial 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 auditing standards 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 the individual interim financial information Based on our review, nothing has come to our attention that causes us to believe that the individual and consolidated interim financial information included in the quarterly information referred to above is not prepared, in all material respects, in accordance with CPC 21 (R1) and IAS 34 issued by IASB, applicable to the preparation of the Quarterly Information - ITR and presented in accordance with the standards issued by Comissão de Valores Mobiliários. 68

4 Other matters - Statements of value added The individual and consolidated interim financial information related to the statements of value added (DVA) for the nine-month period ended, prepared under the responsibility of the Company s management, presented herein as supplementary information for IAS 34 purposes, have been subject to review procedures jointly performed with the review of the Company s interim financial information ITR. In order to form our conclusion, we assessed whether those statements are reconciled with the interim financial information and accounting records, as applicable, and whether their format and contents are in accordance with criteria determined in the Technical Pronouncement CPC 09 Demonstração do Valor Adicionado. Based on our review, nothing has come to our attention that causes us to believe that the statements of added value referred to above were not prepared, in all material respects, consistently with the overall individual and consolidated interim financial information São Paulo, 10 November KPMG Auditores Independentes CRC 2SP014428/O-6 Original report in Portuguese signed by Rogério Hernandez Garcia Contador CRC 1SP213431/O-5 69

5 statement of financial position in september 30, and december 31, (In thousands of Brazilian Reais - R$) Note Parent Company December 31, (Restated) December 31, (Restated) Assets Cash and cash equivalents 7 877,532 1,066,930 3,720,495 3,990,930 Marketable securities 8 153, , , ,167 Trade receivables , ,468 Derivative financial instruments 25 94, ,588 17,771 Inventories , ,173 Receivables from related parties 11 28,662 48,508 56,614 50,257 Income tax receivable 135, , , ,580 Other current tax receivable 10 3,702 3, ,483 94,806 Dividends and interest on capital receivable 6, ,856 6, ,856 Other financial assets 277,586 70, ,586 70,487 Other current assets 25, ,637 75, ,362 Total current assets 1,603,611 1,886,852 6,450,820 6,303,857 Trade receivables ,193 40,501 Deferred income tax and social contribution 19 15,369 6, , ,212 Receivables from related parties , , , ,853 Other recoverable taxes 10 38,363 36,708 80,553 79,044 Judicial deposits , , , ,214 Derivative financial instruments , , , ,640 Other non-current assets 497, , , ,534 Investments in associates 12 10,408,994 10,165, , ,100 Investments in joint ventures 13 2,628,890 2,713,044 8,695,007 8,506,395 Property, plant and equipment 14 23,493 21, , ,329 Intangible assets 15 5,556 6,621 9,189,055 9,328,150 Total non-current 14,481,442 14,158,798 21,206,313 20,995,972 Total Assets 16,085,053 16,045,650 27,657,133 27,299,829 The accompanying notes are an integral part of these consolidated interim financial statements 70

6 statement of financial position in september 30, and december 31, (In thousands of Brazilian Reais - R$) Note Parent Company December 31, (Restated) December 31, (Restated) Liabilities Loans, borrowings and debentures ,749, ,000 Derivative financial instruments 25-9,800 9,504 35,991 Trade payables 17 1,397 3,330 1,700,274 1,467,570 Employee benefits payable 21,096 24, , ,009 Income tax payables 515 1,294 34,166 47,124 Other taxes payable 18 64,962 82, , ,555 Dividends payable 26,595 23,274 27,325 94,055 Payables to related parties , , , ,107 Other financial liabilities ,288 25,734 Other current liabilities 25,141 21, , ,660 Total current liabilities 394, ,635 4,228,596 3,222,805 Loans, borrowings and debentures ,170,521 8,202,129 Preferred shareholders payable in subsidiaries 1,555,517 1,769,427 1,555,516 1,769,427 Derivative financial instruments , , , ,550 Other taxes payable , , , ,720 Provision for legal proceedings , , , ,542 Provision for uncovered liability of associates ,363-6,139 - Payables to related parties 11 3,764,656 3,872, Post-employment benefits , ,480 Deferred tax liabilities ,324,872 1,108,748 Other non-current liabilities 183, , , ,089 Total non-current liabilities 6,254,309 6,607,409 12,113,643 13,284,685 Total liabilities 6,648,441 7,080,044 16,342,239 16,507,490 Shareholders' equity 21 Share capital 3,999,075 3,824,648 3,999,075 3,824,648 Treasury shares (114,413) (34,966) (114,413) (34,966) Capital reserve 969, , , ,318 Other equity 38,998 (295,923) 38,998 (295,923) Profit reserve 3,914,898 4,515,529 3,914,897 4,515,529 Retained earnings 628, ,966 - Equity attributable to: Owners of the Company 9,436,611 8,965,606 9,436,611 8,965,606 Non-controlling interests ,878,283 1,826,733 Total shareholders' equity 9,436,612 8,965,606 11,314,894 10,792,339 Total shareholders' equity and liabilities 16,085,053 16,045,650 27,657,133 27,299,829 The accompanying notes are an integral part of these consolidated interim financial statements 71

7 statement of profit or loss For the three and nine months period ended and (In thousands of Brazilian Reais R$, except earnings per share) Note July 1, to January 1, to 30, Parent Company July 1, to (Restated) January 1, to 30, (Restated) General and administrative expenses (32,337) (89,325) (31,448) (99,675) Other expense, net 23 (12,167) (54,915) (15,604) (69,977) Operating expenses (44,504) (144,240) (47,052) (169,652) Loss before equity in earning and financial results (44,504) (144,240) (47,052) (169,652) Equity in earnings of associates , , ,859 1,432,112 Equity in earnings of joint ventures 13 (13,473) (84,153) (21,498) (83,690) Equity in earnings of investees 449, , ,361 1,348,422 Finance expense (77,825) (355,818) (135,844) (549,175) Finance income 114, ,371 64, ,102 Foreign exchange (losses) gain, net 169, ,472 (47,777) 853,877 Derivatives (42,311) 16, ,879 (1,162,295) Financial results, net ,352 43,294 24,783 (672,491) Profit before taxes 568, , , ,279 Income tax (expenses) benefits 19 Current (4) (7,158) - (15,008) Deferred (68,657) 4,828 5, ,720 (68,661) (2,330) 5, ,712 Profit from continuing operations 499, , , ,991 Profit from discontinued operation, 5 net of tax - - 6,583 24,788 Profit for the period 499, , , ,779 Basic earnings per share from: Continuing operations 22 R$ R$ R$ R$ Discontinuing operations R$ R$ R$ R$ R$ R$ Diluted earnings per share from: Continuing operations 22 R$ R$ R$ R$ Discontinuing operations R$ R$ R$ R$ R$ R$ The accompanying notes are an integral part of these consolidated interim financial statements 72

8 statement of profit or loss For the three and nine months period ended and (In thousands of Brazilian Reais R$, except earnings per share) July 1, to January 1, to July 1, to (Restated) January 1, to (Restated) Note Net sales 2,071,360 5,535,783 1,842,759 5,765,284 Cost of sales (1,324,509) (3,581,438) (1,104,735) (3,413,123) Gross profit 746,851 1,954, ,024 2,352,161 Selling expenses (251,286) (770,664) (262,735) (756,647) General and administrative expenses (151,540) (425,667) (141,080) (417,730) Other expense, net 23 (28,422) (87,776) (21,665) (80,187) Operating expenses (431,248) (1,284,107) (425,480) (1,254,564) Income before equity in earning and financial results 315, , ,544 1,097,597 Equity in earnings of associates 12 1,616 (218) 6,277 (5,515) Equity in earnings of joint ventures , , ,245 1,098,183 Equity in earnings of investees 411, , ,522 1,092,668 Finance expense (330,543) (1,138,039) (592,909) (1,435,305) Finance income 191, , , ,960 Foreign exchange (losses) gain, net 211, ,586 (52,518) 1,018,309 Derivatives (83,134) (14,462) 153,034 (1,223,214) Financial results 24 (10,744) (402,721) (306,040) (1,018,250) Profit before taxes 716, , ,026 1,172,015 Income tax (expenses) benefits 19 Current (80,214) (102,696) (1,349) (143,083) Deferred (67,455) (94,533) (22,865) 69,845 (147,669) (197,229) (24,214) (73,238) Profit from continuing operations 568, , ,812 1,098,777 Profit from discontinued operation, 5 net of tax ,312 58,860 Profit for the period 568, , ,124 1,157,637 Profit attributable to: Owners of the Company 499, , , ,779 Non-controlling interests 69, ,376 85, , , , ,124 1,157,637 Basic earnings per share from: Continuing operations 22 R$ R$ R$ R$ Discontinuing operations R$ R$ R$ R$ R$ R$ Diluted earnings per share from: Continuing operations 22 R$ R$ R$ R$ Discontinuing operations R$ R$ R$ R$ R$ R$ The accompanying notes are an integral part of these consolidated interim financial statements 73

9 statement of other comprehensive income For the three and nine months period ended and (In thousands of Brazilian Reais R$, except earnings per share) July 1, to January 1, to 30, Parent Company July 1, to (Restated) January 1, to 30, (Restated) Profit for the period 499, , , ,779 Other comprehensive income Items that will never be reclassified to profit or loss Financial instruments - common transactions - 69,633-6,000-69,633-6,000 Items that are or may subsequently be reclassified to profit or loss: Foreign currency translation differences 1,169 (10,219) 1,464 63,987 (Loss) gain on cash flow hedge in joint ventures (50,067) 272,136 (37,823) (173,170) Changes in fair value of available for available for sale securities 47 3, (38) (48,851) 265,288 (36,050) (109,221) Total other comprehensive (loss) income, net of tax (48,851) 334,921 (36,050) (103,221) Comprehensive income - Continued operation 450, , , ,357 Comprehensive income - Discontinued operation Total comprehensive income 450, , , ,558 The accompanying notes are an integral part of these consolidated interim financial statements 74

10 statement of other comprehensive income For the three and nine months period ended and (In thousands of Brazilian Reais R$, except earnings per share) July 1, to January 1, to July 1, to (Restated) January 1, to (Restated) Profit for the period 568, , ,124 1,157,637 Other comprehensive income Items that will never be reclassified to profit or loss Financial instruments - common transactions - 69,633-6,000-69,633-6,000 Items that are or may subsequently be reclassified to profit or loss: Foreign currency translation differences 1,169 (10,219) 1,464 63,987 (Loss) gain on cash flow hedge in joint ventures (50,067) 272,136 (37,823) (173,170) Changes in fair value of available for available for sale securities 48 3,371 1, (48,850) 265,288 (35,102) (108,791) Total other comprehensive (loss) income, net of tax (48,850) 334,921 (35,102) (102,791) Comprehensive income - Continued operation 520,134 1,111, ,624 1,054,645 Comprehensive income - discontinuing operations Total comprehensive income 520,134 1,111, ,022 1,054,846 Total comprehensive income attributable to: Owners of the Company 450, , , ,558 Non-controlling interests 69, ,376 86, , ,134 1,111, ,022 1,054,846 The accompanying notes are an integral part of these consolidated interim financial statements 75

11 statements of changes in shareholder equity For the three and nine months period ended (In thousands of Brazilian Reais - R$) Profit reserve Common stock Tresuary share Other capital reserve Others equity components Legal Statutary reserve Unrealized earning Retained rearning Retained earning Total Non-controlling interest Total equity At January 1, 3,824,648 (34,966) 956,318 (295,923) 284,960 2,963, ,021 1,096,016-8,965,606 1,826,733 10,792,339 Profit for the period , , , ,342 Other comprehensive income: Gain on cash flow hedge in joint ventures , , ,136 Foreign currency translation differences (10,219) (10,219) - (10,219) Financial instruments - common transactions , (60,633) - 9,000-9,000 Changes in fair value of available for available for sale securities , ,371-3,371 Total comprehensive income for the period , (60,633) 628, , ,376 1,050,630 Contributions and distributions for shareholders Increase capital 174,427 - (14,427) - (160,000) Dividends - non-controlling interests - - (3,934) (3,934) 3,934 - Share options exercised , ,668-31,668 Dividends (379,998) (379,998) (127,094) (507,092) Redeem entity's shares - (79,447) (79,447) - (79,447) Share-based payment transactions - - 6, , ,380 Total contributions by and distributions to owners of the Parent 174,427 (79,447) 19,460 - (160,000) (379,998) (425,558) (122,933) (548,491) Transactions with owners of the Company Change of shareholding interest in subsidiary - - (6,690) (6,690) 27,107 20,417 Total transactions with shareholders - - (6,690) (6,690) 27,107 20,417 At 3,999,075 (114,413) 969,088 38, ,960 2,583, ,021 1,035, ,966 9,436,612 1,878,283 11,314,895 The accompanying notes are an integral part of these consolidated interim financial statements 76

12 statements of changes in shareholder equity For the three and nine months period ended (In thousands of Brazilian Reais - R$) Profit reserve Common stock Tresuary share Other capital reserve Others equity components Legal Statutary reserve Unrealized earning Retained rearning Retained earning Total Noncontrolling interest Total equity At January 1, 3,822,725 (58,694) 955,326 (184,691) 284,960 2,731, , ,374-8,680,766 3,688,488 12,369,254 Profit for the period (Restated) , , ,858 1,157,637 Other comprehensive income: - Loss on cash flow hedge in joint ventures (173,170) (173,170) - (173,170) Foreign currency translation differences , ,987-63,987 Financial instruments - common transactions , ,000-6,000 Changes in fair value of available for - available for sale securities (38) (38) Total comprehensive income for the period (103,221) , , ,288 1,054,846 Contributions and distributions for shareholders Share options exercised - 11,030 4, ,375-15,375 Dividends - non-controlling interests - - (11,344) (11,344) 11,344 - Dividends (566,686) (566,686) (475,351) (1,042,037) Share-based payment transactions - - 6, ,378-6,378 Total contributions by and distributions to owners of the Parent - 11,030 (621) - - (566,686) (556,277) (464,007) (1,020,284) Transactions with owners of the Company Change of shareholding interest in subsidiary - - (2,969) (2,969) (22,547) (25,516) Total transactions with shareholders - - (2,969) (2,969) (22,547) (25,516) (Restated) 3,822,725 (47,664) 951,736 (287,912) 284,960 2,165, , , ,779 8,871,078 3,507,222 12,378,300 The accompanying notes are an integral part of these consolidated interim financial statements 77

13 statement of cash flows For the three and nine months period ended (In thousands of Brazilian Reais - R$) Cash flows from operating activities Note Parent Company (Restated) (Restated) Profit before taxes 631, , ,571 1,172,015 Adjustments for: Depreciation and amortization 4,543 3, , ,119 Equity in earnings of associates 12 (816,395) (1,432,112) 218 5,515 Equity in earnings of jointly controlled entity 13 84,153 83,690 (706,272) (1,098,183) Gain on disposals assets ,966 5,856 Option shares granted 6,153 6,378 6,773 6,378 Provision for judicial demands 23,977 53,234 22,648 61,250 Indexation charges, interest and exchange, net 17, , ,535 1,216,647 Provisions for employee benefits 13,513 6,764 53,558 44,475 Allowance for doubtful accounts ,286 13,093 Other (4,409) 531 7,778 (3,481) (39,769) (66,649) 1,476,714 1,875,684 Changes in: Trade receivables - - (173,693) (66,285) Inventories - - (12,407) 21,292 Recoverable taxes (26,666) (9,877) (30,903) 110,796 Related parties, net 17,903 (222,183) 12,806 (1,177) Trade payables (2,878) ,674 (163,950) Employee benefits (19,251) (8,781) (67,608) (49,497) Provision for judicial demands (1,485) (145) (5,532) (814) Payables taxes 20,903 (8,190) (24,032) (2,867) Judicial deposits ,485 (665) Discontinued operation ,309 Post-employment benefits - - (20,120) (20,744) Other assets and liabilities, net 271,247 19, ,193 (98,090) 260,707 (228,844) (22,137) (257,692) Net cash generated by (used in) operating activities 220,938 (295,493) 1,454,577 1,617,992 Cash flows from investing activities Capital contribution in associates (58,770) (215,099) (3,968) (10,195) Marketable securities (20,637) - (126,800) - Cash received on sale of fixed assets and intangible assets - - 1,097 - Acquisition of non-controlling interests - (54,122) - (54,122) Dividends received from investees 636,471 1,013,076 2,565 2,199 Dividends received from jointly controlled entity 163,210 58, , ,392 Other financial assets (275,780) (186,052) (275,780) (186,052) Acquisition of property, plant and equipment, intangible assets and investments (5,331) (788) (272,362) (331,222) Discontinued operations (5,393) Related parties - 11,338-11,338 Net cash generated by investing activities 439, , ,962 84,945 78

14 statement of cash flows For the three and nine months period ended (In thousands of Brazilian Reais - R$) Cash flows from financing activities Loans, borrowings and debentures raised ,548 2,723,697 Amortization of principal on loans, borrowings and debentures (645,764) (2,649,942) Payment of interest on loans, borrowings and debentures 16 - (8,859) (421,760) (421,970) Derivative financial intruments (264,721) (385,871) (273,805) (294,606) Capital integralization ,000 Related parties (180,303) Payments to redeem entity's shares (79,447) - (79,447) - Non-controlling interest subscription 20,375 28,764 20,375 28,764 Dividends paid (376,679) (569,517) (839,629) (1,243,155) Proceeds from exercise of share options 31,276 17,185 31,276 17,185 Net cash used by financing activities (849,499) (918,298) (1,948,206) (1,800,027) Decrease in cash and cash equivalents (189,398) (586,660) (266,667) (97,090) Cash and cash equivalents at beginning of period 1,066, ,049 3,990,930 3,129,530 Effect of exchange rate fluctuations on cash held - - (3,768) (41,362) Cash and cash equivalents at end of period 877, ,389 3,720,495 2,991,078 Additional information Income tax paid ,120 54,624 The accompanying notes are an integral part of these consolidated interim financial statements 79

15 statement of value added in september 30, and december 31, (In thousands of Brazilian Reais - R$) January 1, to Parent Company January 1, to (Restated) January 1, to January 1, to (Restated) Revenue Sale of services - - 7,123,440 7,356,204 Other operating revenue 1,548 4,137 17,765 24,928 Allowance for doubtful accounts - - (12,286) (12,686) 1,548 4,137 7,128,919 7,368,446 Raw materials acquired from third parties Cost of services rendered - - (3,564,404) (3,991,969) Materials, energy, third party services, others (93,603) (127,373) (479,481) (459,282) (93,603) (127,373) (4,043,885) (4,451,251) Gross value added (92,055) (123,236) 3,085,034 2,917,195 Retention Depreciation and amortization (4,543) (3,790) (450,653) (452,119) (4,543) (3,790) (450,653) (452,119) Net value added (96,598) (127,026) 2,634,381 2,465,076 Value added transferred in Equity pick-up in investees 816,395 1,432,112 (218) (5,515) Equity pick-up in jointly controlled entity (84,153) (83,690) 706,272 1,098,183 Financial income 399,112 1,038, ,947 1,116,335 Profit from discontinued operations - 24,788-58,860 1,131,354 2,412,189 1,287,001 2,267,863 Value added to be distributed 1,034,756 2,285,163 3,921,382 4,732,939 Distribution of value added Personnel 37,677 33, , ,425 Taxes and contributions 9,568 (315,706) 1,816,427 1,145,050 Financial expenses 358,545 1,714,258 1,004,041 2,153,827 Non-controlling interests , ,858 Dividends - 575, ,000 Profit from continued operations 628, , , ,919 Profit from discontinued operations - 24,788-58,860 1,034,756 2,285,163 3,921,382 4,732,939 The accompanying notes are an integral part of these consolidated interim financial statements 80

16 at 1 Operations Cosan S.A. Indústria e Comércio composed of its subsidiaries and jointly controlled entities ("Company" or "Cosan") is a publicly traded company with its shares traded on the Novo Mercado da Bolsa de Valores de São Paulo ("BM&FBOVESPA") under the ticker symbol CSAN3, and has its headquarters in the city of São Paulo, Brazil. Cosan Limited is the controlling shareholder of Cosan, in which it holds 62.45%. The primary activities in which Cosan S.A. operates, include the following business segments: (i) Piped natural gas distribution to part of the State of São Paulo through its subsidiary Companhia de Gás de São Paulo COMGÁS ( COMGÁS ); (ii) Production and distribution of lubricants, through its indirect subsidiaries Cosan Lubrificantes e Especialidades S.A. ( CLE ) and Comma Oil & Chemicals Ltd. ( Comma ), under the Mobil licensed trademark in Brazil, Bolivia, Uruguay and Paraguay, in addition to the European and Asian market using the Comma s brand and corporate activities ( Moove ) and; and (iv) Other investments, in addition to the corporate structures of Company ( Cosan Corporate ). The Company also holds interests in two jointly controlled entities ("Joint Ventures" or "JVs"): (i) Raízen Combustíveis S.A. ( Raízen Combustíveis ), fuel distribution business, and (ii) Raízen Energia S.A. ( Raízen Energia ), production and marketing of sugar, ethanol and energy cogeneration, produced from sugar cane bagasse. 2 Basis of preparation 2.1 Statement of compliance The interim individual and consolidated financial statements have been prepared in accordance with CPC 21 - Interim Financial Reporting and the International Accounting Standard IAS 34 Interim Financial Reporting issued by the International Accounting Standards Board (IASB), and presented in accordance with the standards issued by the Securities and Exchange Commission applicable to the preparation of the Quarterly Information - ITR. These financial statements have been prepared following the basis of preparation and accounting policies consistent with those adopted in preparing the financial statements for the year ended on December 31, and should be read together. The information notes that did not change significantly compared with the December 31, have not been fully presented in these financial statements. The relevant information specific to the financial statements, and only them, are being evidenced and that correspond to those used by it in its management. These interim financial statements were authorized for issue by the Board of Directors on Novemebr 10,. 81

17 at 3 Significant accounting policies The accounting policies set out below have been applied consistently by the Company to all periods presented in this consolidated financial statements. 3.1 Basis of consolidation The consolidated interim financial statements include the accounts of Cosan and its subsidiaries. Cosan s subsidiaries are listed below: Direct and indirect interest 30, December 31, Directly owned subsaresidiaries _Comma Oil Chemicals % % _Companhia de Gás de São Paulo COMGÁS (i) 63.11% 62.66% _Cosan Biomassa S.A. (ii) % % _Cosan Cayman II Limited % % _Cosan Global Limited % % _Cosan Investimentos e Participações S.A % % _Cosan Lubes Investments Limited % % _Cosan Lubrificantes e Especialidades S.A % % _Cosan Luxembourg S.A % % _Cosan Overseas Limited % % _Cosan Paraguay S.A % % _Cosan US, Inc % % _Ilha Terminal Distribuição de Produtos Químicos % % _Pasadena Empreendimentos e Participações S.A % % Zip Lube S.A % % (i) (ii) At, the Company increased its interest to 63.11% in COMGAS due to the capital increase arising from the partial use of the tax benefit of goodwill pursuant to the Ordinary / Extraordinary General Meeting of April 20, of subsidiary COMGAS. The Company recorded in the first quarter of, a put option for the repurchase of shares of non-controlling shareholders, according to the shareholder agreement. Management has concluded that there are no material uncertainties that cast doubt on the continuity of the subsidiaries. Although they had a combined amount of uncovered liabilities of R$ 101,363 as of, no events or conditions were identified that individually or collectively could raise significant doubts related to their ability to maintain their operational continuity. The subsidiaries have the financial support of the Company. 4 New standards and interpretations not yet effective The following new standards and interpretations of standards have been issued by the IASB, but are not in force for the year. Early adoption of standards, although encouraged by the IASB, is not permitted in Brazil by the Accounting Pronouncements Committee (CPC). 82

18 at CPC 47 - Revenue from Contracts with Customers This standard combines, enhances and replaces specific guidance on recognizing revenue with a single standard. It defines a new five-step model to recognize revenue from customer contracts. The Company has undertaken a review of the main types of commercial arrangements used with customers under this model and has tentatively concluded that the application of IFRS 15 will not have a material impact on the consolidated results or financial position. The effects identified so far are as follows (i) Recognition of incremental costs to obtain a contract as an intangible asset; and (ii) Presentation of revenue from sales of lubricants segregated from services rendered, previously disclosed in other income items in note 6 - Operating segment. This standard is mandatory for the accounting period beginning on January 1, The Company is planning to apply the standard retrospectively, utilizing the practical expedient to not restate contracts that begin and end within the same annual accounting period. CPC 48 - Financial instruments The standard addresses the accounting principles for the financial reporting of financial assets and financial liabilities, including classification, measurement, impairment, derecognition and hedge accounting. It will be mandatory for the accounting period beginning on January 1, In order to measure the consequences of this new standard, the Group has engaged a review of the business model corresponding to the different portfolios of financial assets and of the characteristics of these financial assets, such as equity instruments and instruments whose cash flows are solely payments of principal and interest ( SPPI ). This review will also support the designation of equity instruments at fair value through other comprehensive income when appropriate as per the business objective. There is no expected impact on the Company accounting for financial liabilities, as the new requirements only affect the accounting for financial liabilities that are designated at fair value through profit or loss attributable to changes in its liquidity risk, and the Company does not have any such liabilities. The impact of the new impairment model is also under review. This analysis requires the identification of the credit risk associated with the counterparties and, considering that the majority of Company s financial assets are trade receivables, integrates as well some statistical data reflecting the actual past experience of occurred loss for default. In addition, the Company is reviewing the definition of a hedge relationship in accordance with risk management activities and policies. The Company plans to apply the standard retrospectively, using the practical file with cumulative effect of the initial application. IFRS 16 Leases The Company began an initial assessment of the potential impact on its financial statements. So far, the most significant impact identified is that the subsidiary Rumo S.A will recognize new assets and liabilities for its operating leases related to concession. The analyses of the impacts on investments in joint ventures are ongoing. The Company has not yet quantified the impact of adopting IFRS 16 on its assets and liabilities. The quantitative effect of the adoption of IFRS 16 will depend specifically on the transition method chosen, the use of practical files and recognition exemptions, and any additional leases that the Company will enter into. The Company expects to disclose its transition approach and quantitative information prior to adoption. 83

19 at Amendments to CPC 03 Statement of cash flows The amendments require entities to provide disclosures about changes in their liabilities arising from financing activities, including both changes arising from cash flows and non-cash changes (such as foreign exchange gains or losses). On initial application of the amendment, the Company is not required to provide comparative information for preceding periods. The Company is not required to provide additional disclosures in its interim consolidated financial statements, but will disclose additional information in its annual consolidated financial statements for the year ended December 31,. Amendments to IAS 32 Income taxes: recognition of deferred tax assets for unrecognized The amendments clarify that an entity needs to consider whether tax law restricts the sources of taxable profits against which it may make deductions on the reversal of that deductible temporary difference. Furthermore, the amendments provide guidance on how the Company should determine future taxable profits and explain the circumstances in which taxable profit may include the recovery of some assets for more than their carrying amount. Company is required to apply the amendments retrospectively. However, on initial application of the amendments, the change in the opening equity of the earliest comparative period may be recognized in opening retained earnings (or in another component of equity, as appropriate), without allocating the change between opening retained earnings and other components of equity. The Company is not required to provide additional disclosures in its interim consolidated financial statements, but will disclose additional information in its annual consolidated financial statements for the year ended December 31,. There are no other IFRS standards or IFRIC interpretations that have not come into effect and are expected to have a material impact on the Company. 5 Changes adopted The changes below were applied for the first time in and did not result in a significant impact on the Company's annual consolidated financial statements or in the interim financial statements. Correction of immaterial errors Tax installments During the year of, the Company identified an error in the accounting record of tax installment liabilities, related to others federal taxes than income tax, referring to prior years. Management concluded that the effect of the correction of error had no material impact on the Company's interim financial statements for the three and nine months periods ended. 84

20 at The impacts of the restatement for the three and nine months periods ended are as follows: Loss before equity in earnings of investees and financial results July 1, to (as issued) Correction of error - Tax installment July 1, to (restated) Parent Company January 1, to (as issued) Correction of error - Tax installment January 1, to (restated) (47,052) - (47,052) (169,652) - (169,652) Equity in earnings of associates 357, ,859 1,432,112-1,432,112 Equity in earnings of joint ventures (21,498) - (21,498) (83,690) - (83,690) Equity in earnings of investees 336, ,361 1,348,422-1,348,422 Financial results 27,321 (2,538) 24,783 (664,877) (7,614) (672,491) Income before taxes 316,630 (2,538) 314, ,893 (7,614) 506,279 Income tax expense 4, , ,124 2, ,712 Profit from continuing operations 320,929 (1,675) 319, ,017 (5,026) 827,991 Profit from discontinued operations, net of tax 6,583-6,583 24,788-24,788 Profit for the period 327,512 (1,675) 325, ,805 (5,026) 852,779 85

21 at July 1, to (as issued) Correction of error - Tax installment July 1, to (restated) January 1, to (as issued) Correction of error - Tax installment January 1, to (restated) Net sales 1,842,759-1,842,759 5,765,284-5,765,284 Cost of sales (1,104,735) - (1,104,735) (3,413,123) - (3,413,123) Gross profit 738, ,024 2,352,161-2,352,161 Operating expense Gross profit (425,480) - (425,480) (1,254,563) - (1,254,563) Income before equity in earnings of investees and financial results 312, ,544 1,097,598-1,097,598 Equity in earnings of associates 6,277-6,277 (5,515) - (5,515) Equity in earnings of joint ventures 404, ,245 1,098,183-1,098,183 Equity in earnings of investees 410, ,522 1,092,668-1,092,668 Financial results (303,502) (2,538) (306,040) (1,010,636) (7,614) (1,018,250) Income before taxes 419,564 (2,538) 417,026 1,179,630 (7,614) 1,172,016 Income tax expense (25,077) 863 (24,214) (75,826) 2,588 (73,238) Profit from continuing operations 394,487 (1,675) 392,812 1,103,804 (5,026) 1,098,778 Profit from discontinued operations, net of tax 18,312-18,312 58,859-58,859 Profit for the period 412,799 (1,675) 411,124 1,162,663 (5,026) 1,157,637 6 Segment Information The following segment information is based on the information used by Cosan's senior management to assess the performance of the operating segments and to make decisions with regards to the allocation of resources. This information is prepared on a consistent basis with the accounting policies used in the preparation of the consolidated financial statements. Cosan evaluates operating performance based on the measure of EBITDA. A reconciliation of EBITDA to profit (loss) of the period is presented below. Reported segments (i) (ii) Raízen Energia: production and marketing of a variety of products derived from sugar cane, including raw sugar (VHP), anhydrous and hydrated ethanol, and activities related to energy cogeneration from sugarcane bagasse. In addition, this segment holds interests in companies engaged in research and development on new technology; Raízen Combustíveis: distribution and marketing of fuels, mainly through a franchised network of service stations under the brand Shell throughout Brazil; (iii) COMGÁS: distribution of piped natural gas to part of the State of São Paulo (approximately 180 municipalities, including the region called Greater São Paulo) to customers in the industrial, residential, commercial, automotive, thermo generation and cogeneration sectors; (iv) Moove: production and distribution of lubricants under the Mobil brand in Brazil, Bolivia, Uruguay 86

22 at and Paraguay, as well as European and Asian market with a Comma trademark; and Reconciliation (i) Cosan Corporate: other investments, in addition to the corporate activities of the Company. The Cosan Corporate segment's includes the subsidiaries responsible for raising funds for the group. Although Raízen Energia and Raízen Combustíveis are equity accounted joint ventures and are no longer proportionally consolidated since adoption of IFRS 11, senior management continues to review segment information. A reconciliation of these segments is presented in the column Deconsolidation IFRS 11. The following statement of financial position and profit or loss selected information by segment was prepared on the same basis as the accounting practices used in the preparation of consolidated information: 87

23 at Raízen Energia Raízen Combustíveis Reported segments COMGÁS Moove Cosan Corporate Reconciliation Desconsolidated effects IFRS 11 July 1, to Segment elimination / adjustments Total consolidated Statement of profit or loss: Net sales 3,839,928 18,452,780 1,535, ,319 1,963 (22,292,708) (5) 2,071,360 Domestic market 1,779,982 18,452,780 1,535, ,277 1,963 (20,232,762) (5) 1,949,318 External market 2,059, ,042 - (2,059,946) - 122,042 Cost of sales (2,933,820) (17,324,968) (935,951) (384,190) (4,373) 20,258,788 5 (1,324,509) Gross profit 906,108 1,127, , ,129 (2,410) (2,033,920) - 746,851 Selling expenses (274,891) (353,871) (154,513) (96,630) (143) 628,762 - (251,286) General and administrative expenses (164,978) (113,835) (88,301) (23,364) (39,875) 278,813 - (151,540) Other income (expenses), net 1,933 70,798 (11,635) (3,739) (13,048) (72,731) - (28,422) Financial results 75,498 (72,060) (57,266) (12,472) 58,994 (3,438) - (10,744) Financial expenses (234,085) (63,007) (132,868) (9,134) (188,541) 297,092 - (330,543) Financial Income 166,089 27,914 75,617 3, ,428 (194,003) - 191,299 Foreign exchange losses, net 23,242 98,999 41,436 3, ,595 (122,241) - 211,634 Derivatives 120,252 (135,966) (41,451) (10,195) (31,488) 15,714 - (83,134) Equity in earnings of associates (388) - - (1,459) 129, (125,969) 1,616 Equity in earnings of joint ventures , ,178 Income tax (expense) benefit (150,269) (213,747) (99,607) (5,014) (43,048) 364,016 - (147,669) Profit (loss) from continuing operations 393, , ,810 7, ,692 (838,110) (125,969) 568,984 Net income attributable to: Owners of the Parent 393, , ,518 7, ,692 (821,293) (125,969) 499,692 Non-controlling interests - 16,817 69, (16,817) - 69, , , ,810 7, ,692 (838,110) (125,969) 568,984 Other select data: Depreciation and amortization 582, , ,570 19,537 3,892 (752,814) - 141,999 EBITDA 1,050, , ,253 44, ,638 (1,951,502) (125,969) 869,396 Additions to PP&E, intangible and biological assets 414, ,897 73,083 15,645 3,655 (586,822) - 92,383 Reconciliation of EBITDA: Profit (loss) for the period 393, , ,810 7, ,692 (838,110) (125,969) 568,984 Income tax and social contribution 150, ,747 99,607 5,014 43,048 (364,016) - 147,669 Financial results, net (75,498) 72,060 57,266 12,472 (58,994) 3,438-10,744 Depreciation and amortization 582, , ,570 19,537 3,892 (752,814) - 141,999 EBITDA 1,050, , ,253 44, ,638 (1,951,502) (125,969) 869,396 88

24 at Raízen Energia Raízen Combustíveis Reported segments COMGÁS Moove Cosan Corporate Reconciliation Desconsolidated effects IFRS 11 January 1, to Segment elimination / adjustments Total consolidated Statement of profit or loss: Net sales 9,859,076 53,414,974 4,041,014 1,492,481 2,326 (63,274,050) (38) 5,535,783 Domestic market 5,122,996 53,414,974 4,041,014 1,170,189 2,326 (58,537,970) (38) 5,213,491 External market 4,736, ,292 - (4,736,080) - 322,292 Cost of sales (8,261,849) (50,571,173) (2,522,881) (1,052,605) (5,990) 58,833, (3,581,438) Gross profit 1,597,227 2,843,801 1,518, ,876 (3,664) (4,441,028) - 1,954,345 Selling expenses (605,608) (995,950) (486,543) (283,921) (200) 1,601,558 - (770,664) General and administrative expenses (452,230) (332,499) (246,495) (64,758) (114,414) 784,729 - (425,667) Other income (expenses), net (91,094) 250,073 (21,523) (3,906) (62,347) (158,979) - (87,776) Financial results 112,478 (315,346) (139,883) (36,648) (226,190) 202,868 - (402,721) Financial expenses (685,640) (182,876) (489,187) (27,519) (621,333) 868,516 - (1,138,039) Financial Income 546,300 98, ,573 15, ,704 (644,803) - 615,194 Foreign exchange losses, net (15,935) 49,092 27,771 (23) 106,838 (33,157) - 134,586 Derivatives 267,753 (280,065) (28,040) (25,023) 38,601 12,312 - (14,462) Equity in earnings of associates (48,159) - - (5,606) 282,076 48,159 (276,688) (218) Equity in earnings of joint ventures , ,272 Income tax (expense)benefit (56,558) (446,914) (226,136) (18,527) 47, ,472 - (197,229) Profit (loss) from continuing operations 456,056 1,003, ,553 26, ,967 (1,459,221) (276,688) 776,342 Net income attributable to: Owners of the Parent 456, , ,177 26, ,967 (1,414,121) (276,688) 628,966 Non-controlling interests - 45, , (45,100) - 147, ,056 1,003, ,553 26, ,967 (1,459,221) (276,688) 776,342 Other select data: Depreciation and amortization 1,536, , ,388 59,089 12,176 (2,019,651) - 450,653 EBITDA 1,936,972 2,248,240 1,142, , ,899 (4,185,212) (276,688) 1,826,945 Additions to PP&E, intangible and biological assets 1,715, , ,530 22,415 5,417 (2,306,683) - 272,362 Reconciliation of EBITDA: Profit (loss) for the period 456,056 1,003, ,553 26, ,967 (1,459,221) (276,688) 776,342 Income tax and social contribution 56, , ,136 18,527 (47,434) (503,472) - 197,229 Financial results, net (112,478) 315, ,883 36, ,190 (202,868) - 402,721 Depreciation and amortization 1,536, , ,388 59,089 12,176 (2,019,651) - 450,653 EBITDA 1,936,972 2,248,240 1,142, , ,899 (4,185,212) (276,688) 1,826,945 89

25 at Raízen Energia Raízen Combustíveis Reported segments COMGÁS Radar Moove 90 Cosan Corporate July 1, to (Restated) Reconciliation Segment Desconsolidated Total elimination / effects IFRS 11 consolidated adjustments Statement of profit or loss: Net sales 3,148,411 17,380,867 1,379, , (20,529,278) - 1,842,759 Domestic market 1,274,667 17,380,867 1,379, , (18,655,534) - 1,734,369 External market 1,873, ,390 - (1,873,744) - 108,390 Cost of sales (2,480,327) (16,425,140) (763,700) - (339,903) (1,132) 18,905,467 - (1,104,735) Gross profit 668, , , ,679 (1,084) (1,623,811) - 738,024 Selling expenses (199,486) (308,615) (170,632) - (92,089) (14) 508,101 - (262,735) General and administrative expenses (127,330) (103,440) (84,632) - (17,742) (38,706) 230,770 - (141,080) Other income (expenses), net (20,404) 412, (22,573) (391,722) - (21,665) Financial results 70,315 (146,529) (55,670) - (15,563) (234,807) 76,214 - (306,040) Financial expenses (223,405) (152,843) (190,177) - (16,161) (386,571) 376,248 - (592,909) Financial Income 172,270 63, ,545-1,157 50,651 (235,485) - 186,353 Foreign exchange losses, net 2,706 (45,351) (12,528) - 1,219 (41,209) 42,645 - (52,518) Derivatives 118,744 (11,550) 12,490 - (1,778) 142,322 (107,194) - 153,034 Equity in earnings of associates (10,305) (2,830) - - (1,553) 126,960 13,135 (119,130) 6,277 Equity in earnings of joint ventures , ,245 Income tax (expense)benefit (105,808) (258,783) (109,356) - (92) 85, ,591 - (24,214) Profit (loss) from continuing operations 275, , ,865 - (3,178) 319,255 (822,722) (119,130) 392,812 Profit (loss) from discontinued operations, net of tax ,312-6,582 - (6,582) 18,312 Net income attributable to: Owners of the Parent 274, , ,308 6,582 (3,178) 325,837 (809,921) (125,712) 325,837 Non-controlling interests 88 12,713 73,557 11, (12,801) - 85, , , ,865 18,312 (3,178) 325,837 (822,722) (125,712) 411,124 Other select data: Depreciation and amortization 477, , ,064-23,748 3,423 (623,454) - 161,235 EBITDA 788,461 1,098, ,955-36, ,251 (1,886,981) (119,130) 884,301 Additions to PP&E, intangible and biological assets 354, ,632 89,291-11,188 5,956 (545,795) - 106,435 Reconciliation of EBITDA: Profit (loss) for the period 275, , ,865 - (3,178) 319,255 (822,722) (119,130) 392,812 Income tax and social contribution 105, , , (85,234) (364,591) - 24,214 Financial results, net (70,315) 146,529 55,670-15, ,807 (76,214) - 306,040 Depreciation and amortization 477, , ,064-23,748 3,423 (623,454) - 161,235 EBITDA 788,461 1,098, ,955-36, ,251 (1,886,981) (119,130) 884,301

26 at Raízen Energia Raízen Combustíveis Reported segments COMGÁS Radar Moove 91 Cosan Corporate January 1, to (Restated) Reconciliation Segment Desconsolidated Total elimination / effects IFRS 11 consolidated adjustments Statement of profit or loss: Net sales 9,657,588 50,252,193 4,333,163-1,431, (59,909,781) - 5,765,284 Domestic market 3,955,267 50,252,193 4,333,163-1,096, (54,207,460) - 5,429,659 External market 5,702, ,625 - (5,702,321) - 335,625 Cost of sales (7,364,106) (47,690,919) (2,321,714) - (1,081,183) (10,226) 55,055,025 - (3,413,123) Gross profit 2,293,482 2,561,274 2,011, ,513 (9,802) (4,854,756) - 2,352,161 Selling expenses (568,201) (965,232) (485,102) - (271,431) (114) 1,533,433 - (756,647) General and administrative expenses (405,951) (324,245) (242,585) - (53,482) (121,663) 730,196 - (417,730) Other income (expenses), net 16, ,196 (1,930) - 2,037 (80,294) (626,740) - (80,187) Financial results 486,213 (426,235) (197,677) - (59,827) (760,746) (59,978) - (1,018,250) Financial expenses (697,432) (208,240) (564,425) - (38,841) (832,039) 905,672 - (1,435,305) Financial Income 500, , ,171-2, ,822 (677,594) - 621,960 Foreign exchange losses, net (57,513) 736, ,033-46, ,709 (679,239) - 1,018,309 Derivatives 740,989 (1,132,172) (229,456) - (70,520) (923,238) 391,183 - (1,223,214) Equity in earnings of associates (59,080) (310) - - (4,575) 403,097 59,390 (404,037) (5,515) Equity in earnings of joint ventures ,098, ,098,183 Income tax (expense)benefit (553,720) (443,006) (377,118) - 4, , ,726 - (73,238) Profit (loss) from continuing operations 1,209,287 1,012, ,037 - (32,212) 827,988 (2,221,729) (404,037) 1,098,777 Profit (loss) from discontinued operations, net of tax ,860-24,788 - (24,788) 58,860 Net income attributable to: Owners of the Parent 1,209, , ,250 24,789 (32,212) 852,776 (2,186,680) (428,825) 852,779 Non-controlling interests 88 34, ,787 34, (35,049) - 304,858 1,209,287 1,012, ,037 58,860 (32,212) 852,776 (2,221,729) (428,825) 1,157,637 Other select data: Depreciation and amortization 1,662, , ,871-66,334 10,914 (2,120,169) - 452,119 EBITDA 2,939,139 2,339,507 1,656,703-89,396 1,300,321 (5,278,646) (404,037) 2,642,383 Additions to PP&E, intangible and biological assets 1,522, , ,751-29,876 8,595 (2,119,170) - 331,222 Reconciliation of EBITDA: Profit (loss) for the period 1,209,287 1,012, ,037 - (32,212) 827,988 (2,221,729) (404,037) 1,098,776 Income tax and social contribution 553, , ,118 - (4,553) (299,327) (996,726) - 73,238 Financial results, net (486,213) 426, ,677-59, ,746 59,978-1,018,250 Depreciation and amortization 1,662, , ,871-66,334 10,914 (2,120,169) - 452,119 EBITDA 2,939,139 2,339,507 1,656,703-89,396 1,300,321 (5,278,646) (404,037) 2,642,383