EARNINGS RELEASE 2Q15

Transcription

1 EARNINGS RELEASE 2Q15 São Paulo, August 12, RUMO LOGÍSTICA OPERADORA MULTIMODAL S.A. (BM&FBovespa: RUMO3) ( Rumo ALL ) and COSAN LOGÍSTICA S.A. (BM&FBovespa: RLOG3) ( Cosan Logística ) announce today their results for the second quarter of (2Q15) comprising the months of April, May and June. The results are consolidated in accordance with the accounting practices adopted in Brazil and the International Financial Reporting Standards (IFRS) applied to the interim financial statements. Rumo ALL Highlights in 2Q15 This report includes Rumo's results consolidating ALL since April 1, (opening balance sheet), as well as the combined¹ results of the respective comparison periods. The consolidated EBITDA of Rumo ALL totaled R$587 million (up 9% from 2Q14), with an EBITDA margin of 48.1% due to higher volumes transported and reflecting the initial operational improvements and efficiency gains. The total volume transported grew 6% yearly: 10% increase in transportation of agricultural products, partially offset by 7% decrease in the transportation of industrial products. Port loading of 2.2 million tons, 12.3% lower than in 2Q14 due to the late start of sugar trading and exports. 2Q15 2Q14 Chg. % Summmary of Financial Information - Rumo ALL 6M15 6M14 Chg. % Combined (Amounts in R$ MM) Combined Combined 1, , % Net Revenue 2, , % % Gross Profit % % EBITDA % 48.1% 46.8% 1.3 p.p. EBITDA Margin (%) 41.0% 45.8% -4.8 p.p % Net Income (Loss) (193.0) % 2.7% 4.5% -1.8 p.p. Net Margin (%) -8.8% 2.7% p.p % CAPEX % Note 1: The combined results refer to the sum of Rumo and ALL consolidated with the appropriate eliminations of transactions with related parties, not necessarily fulfilling all the requirements of OCPC 06 - Presentation of Financial Pro Forma. Conference Call Portuguese 1:00 p.m. (EST) August 13, (Thursday) Phone: Code: RUMO Investor Relations ir@rumoall.com Phones: Website: ir.rumoall.com English 2:00 p.m. (EST) August 13, (Thursday) Phone (BR): Phone (USA): Code:RUMO 1 of 84

2 Earnings Release 2 nd Quarter of 1. Executive Summary 2Q15 According to CONAB s latest data from August 11,, The Brazilian grain production during the /15 crop reached million tons, setting a new record. The 7.9% increase when compared to the 2013/14 crop is due to improved productivity of corn in the second crop in all corn producing states, especially in the Midwest region and in Paraná. Agricultural products targeting exports account for a significant portion of our railroad transportation volumes and are therefore directly influenced by the various crops growth. This is the first quarter reported after the merger of ALL shares into Rumo and the changes implemented by the new management have already impacted our results. The volume transported in the 2Q15 grew 5.7% yearly to 11.3 billion RTK, boosted by a 9.6% increase in agricultural products transported (particularly soybean, corn and sugar), partially offset by 6.9% decrease in the transportation of industrial products. The consolidated EBITDA totaled R$586.9 million in the quarter, up 8.8% from 2Q14. Volume growth was the main driver behind the EBITDA expansion. EBITDA margin also increased (48.1% in 2Q15 vs. 46.8% in 2QT14), reflecting the efforts to reduce costs and improve operational efficiency. We had an extraordinary gain of R$29.8 million (non-cash) from the termination of the pre-existing relationship between Rumo and ALL in the 2Q15. The hike in interest rates had a negative impact on the financial result, leading to higher l cost of debt. Net income reached R$33.2 million in 2Q15. The opening balance sheet of Rumo ALL is available on page 16 of this earnings release, including full disclosure of the criteria used to derive it. EBITDA in the first half of the year totaled R$898.4 million, achieving approximately 50% of the midpoint of our guidance for, in line with our budget. According to the National Supply Company (CONAB), the Brazilian soybean and corn crops are set to grow 11.7% and 6.5%, respectively. Furthermore, the worse climate in the United States in mid-july (source USDA) led to an increase in corn prices, which may increase the interest of Brazilian producers in extending the export window to the second half of. Sugar volumes not shipped in the first half of are expected to be shipped in the second half of, a trend already observed in July. Truck sales decreased 42% YTD (source FENABRAVE), likely increasing demand for railroad transportation going forward. We made important changes to this Earnings Release to align our reporting format to the way the new management will effectively monitor the performance of Rumo ALL from now on. We are breaking down the results into North Operations (Malha Norte, Malha Paulista and Port Operation in Santos), South Operations (Malha Oeste and Malha Sul) and Container Operations (Brado Operations and other results of container operations). We included financial performance indicators for each of the operations as well as the operational progress resulting from investments and all the efforts geared towards improving processes. All comments in this report refer to the integrated operations of Rumo ALL, but all the financial information related to Cosan Logística s 2Q15 is available in the appendices. We also provide all the financial information published herein in our Investor Relations website (ir.rumoall.com) to facilitate the analysis of our results going forward. 2 of 84

3 Earnings Release 2 nd Quarter of 2. Operating and Financial Indicators 2Q15 2Q14 Operational na Financial Indicators 6M15 6M14 Chg. % Combined (Amounts in R$ MM) Combined Combined Chg. % 11,252 10, % Transported Volume (millions RTK) 20,285 20, % 8,906 8, % Agricultural Products 15,734 15, % 2,345 2, % Industrial Products 4,551 4, % % Average Transportation Yield (R$/000 RTK) % 1,952 2, % Volume Loaded (TU '000) 4,422 4, % 1, , % Net Operating Revenue 2, , % 1, % Rail Operations % % Port Elevation % % Other Revenues² % % EBITDA % 48.1% 46.8% 1.3 p.p. EBITDA Margin (%) 41.0% 45.8% -4,8 p.p. Note 2: Includes income for the right of way of other railways, the sugar transportation revenues using other railways as well as using road transportation. Transported Volume (millions RTK) e Average Transportation Yield (R$/000 RTK) 3. Market Scenario Calendar of Brazilian Crops The four railroad concessions we operate cover approximately 12,000 kilometers of railroads located in the South, Southeast and Midwest regions of Brazil, where approximately 80% of the country's GDP is concentrated. Our railroads transport agricultural commodities and industrial products, and are connected to the country's four main ports. Those four ports concentrate most of the country's agricultural commodity exports. Exported agricultural commodities account for 70% to 80% of the volume transported in this segment. The following table highlights the calendar of the main agricultural commodities transported by Rumo ALL. Soybean Exports* Previous Fiscal Year Fiscal Year Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 3Q 4Q 1Q 2Q 3Q 4Q Planting Handling Harvest 30% of sales 40% of sales 20% of sales 10% of sales 1.6% 1.8% 8.1% 13.7% 15.0% 14.3% 13.2% 11.3% 9.5% 5.9% 3.1% 2.4% Corn Exports* Planting 1st Crop Planting 2nd Crop Handling 1st Crop Handling 2nd Crop Harvest 1st Crop Harvest 2nd Crop 10% of sales 15% of sales 40% of sales 35% of sales 8.1% 7.5% 6.5% 4.6% 5.3% 4.9% 5.7% 9.6% 12.7% 11.9% 11.5% 11.6% Planting Handling Sugar Harvest 30% of sales 15% of sales 30% of sales 25% of sales Exports* 5.7% 5.1% 5.2% 4.1% 7.0% 9.0% 11.1% 12.5% 11.5% 11.8% 9.4% 7.5% Note: Exports*: 5-year average according to Brazilian Trade Balance Source: SLC Agrícola, Raízen, Sã Martinho, SECEX, Embrapa, BofA Merrill Lynch Global Research 3 of 84

4 Earnings Release 2 nd Quarter of Freight Dynamics in the Brazilian Market Freight prices in Brazil are freely negotiated based on supply and demand. Freight prices, however, are influenced by variables such as distance traveled, operating costs, the possibility of back hauling, speed of loading and unloading, seasonality of demand for transportation, delivery time and some geographical aspects. Agricultural trading is particularly sensitive to changes in transportation costs since they account for a significant portion of the final price. Given the dynamics described above, there is no official benchmark price in the Brazilian market for road or railroad freights. The most important road routes are monitored by economic research institutes to check the behavior of market prices. The data collected can serve as the basis for negotiating the freights for specific products and their respective destinations. The table below shows historical freight prices between the Rondonópolis (Mato Grosso) and the Port of Santos (São Paulo). This route is responsible for a significant portion of the grains transported in Brazil according to the Instituto Mato-Grossense de Economia Agropecuária (IMEA; Source: IMEA Note: monthly moving average freight released weekly by IMEA 4 of 84

5 Earnings Release 2 nd Quarter of 4. Result by Business Unit Business Unit The business units (reporting segments) are organized as follows: North Operations Malha Norte, Malha Paulista and Port Operation in Santos South Operations Malha Oeste and Malha Sul Container Operations Brado operations and other results of container operations Results by Business Unit 2Q15 North Operations South Operations Container Operations Net Revenue ,220.3 Cost of Services (425.2) (245.5) (95.3) (766.0) Gross Profit (12.5) Gross Margin(%) 48.0% 23.3% -15.1% 37.2% Selling Expenses, General and Administrative Expenses (53.3) (16.5) (14.4) (84.2) Other Operating Revenues (Expenses) Depreciation and Amortization (115.3) (47.0) (14.6) (176.9) EBITDA (11.9) EBITDA Margin (%) 60.1% 33.5% -14.4% 48.1% 6M15 Combined North South Container Operations Operations Operations Net Revenue 1, ,190.4 Costs of Services (834.4) (448.5) (185.8) (1,468.6) Gross Profit (16.6) Gross Margin(%) 43.3% 18.3% -9.8% 33.0% Selling Expenses, General and Administrative Expenses (117.4) (37.6) (27.8) (182.9) Other Operating Revenues (Expenses) 15.2 (6.7) Depreciation and Amortization (224.9) (94.6) (29.8) (349.3) EBITDA (12.9) EBITDA Margin (%) 51.7% 27.5% -7.6% 41.0% 5 of 84

6 Earnings Release 2 nd Quarter of North Operations 2Q15 2Q14 Operational Figures 6M15 6M14 Chg. % Combined Combined Combined Chg. % 6,968 6, % Transported Volume (millions RTK) 12,358 11, % 6,283 5, % Agricultural Products 11,038 10, % 3,946 3, % Soybean 6,993 7, % 1,344 1, % Soybean meal 2,367 1, % n/a Corn n/a % Sugar % - 8 n/a Fertilizers % % Industrial Products 1,320 1, % % Fuels % % Wood, Pulp and Paper % % Average Transportation Yield (R$/000 RTK) % 1,952 2,226-12,3% Volume Loaded (TU '000) 4,422 4, % The total volume transported in the North Operations reached 7.0 billion RTK, up 9.7% from 2Q14. The lower volume of grains transported in 1Q15 compared to 1Q14 was compensated in 2Q15, resulting on a 10.6% yearly growth of agricultural products, also boosted by the early start of trading of the corn crop due to better prices. Industrial products grew 1.9% in 2Q15 versus 2Q14, mainly due higher volume of fuels transported given the operational start-up of the Raízen and Ipiranga plants in Rondonópolis. The volume loaded in the terminals controlled by Rumo ALL in the Port of Santos totaled 2.0 million tons, down 12.3% from 2Q14. The main reason for the decrease in the volume loaded was the late start of sugar trading due to unattractive prices for exporters, which was partially offset by higher volumes of grains loaded in the quarter. 2Q15 2Q14 Financial Results 6M15 6M14 Chg. % Combined (Amounts in R$ MM) Combined Combined Chg. % % Net Operating Revenue 1, , % % Transportation 1, , % % Agricultural Products 1, , % % Industrial Products % % Port Elevation % % Other Revenues² % (425.2) (389.6) 9.1% Cost of Services (834.4) (740.1) 12.7% % Gross Profit % 48.0% 47.8% 0.2 p.p. Gross Margin (%) 43.3% 47.3% -4.0 p.p. (53.3) (51.0) 4.4% Selling, General and Administrative Expenses (117.4) (101.8) 15.4% 37.4 (7.1) n/a Other Operational Revenues (Expenses) and Equity Pickup 15.2 (1.0) n/a % Total EBITDA % 60.1% 55.1% 5.1 p.p. EBITDA Margin (%) 51.7% 55.6% -4.0 p.p. Note 2: Includes income for the right of way of other railways, the sugar transportation revenues using other railways as well as using road transportation. Net revenues from North Operations totaled R$817.3 million in 2Q15, up 9.6% from 2Q14. This growth is mainly due to the higher volume of agricultural products transported, up 10.6% from 2Q14, boosted by grain transportation, partially offset by lower sugar volumes. The average transportation yield increased 2.2% to R$101.8/thousand RTK in 2Q15, mainly due to better sugar prices (15% compared to 2Q14). The cost of services provided increased by 9.1% from 2Q14 to reach R$425.2 million. The increase in costs was due to higher volumes transported. Higher diesel consumption costs and higher allocation of maintenance and personnel expenses according to the new accounting policies adopted also contributed to the increase in total costs. The EBITDA from North Operations reached R$491.6 million, up 19.6% from 2Q14. As already described, the growth in volumes transported and average yield, combined with operational improvements already implemented, were the key drivers behind the growth. Excluding the non-recurring (non-cash) gains related to the termination of Rumo's agreement in the amount of R$29.8 million recorded under Other operational revenues, the EBITDA would have been R$461.8 million. This effect refers to the liquidation of the pre-existing relationship between Rumo and ALL, item 11 of the Opening Balance Sheet. 6 of 84

7 Earnings Release 2 nd Quarter of South Operations 2Q15 2Q14 Operational Figures 6M15 6M14 Chg. % Combined Combined Combined Chg. % 3,709 3, % Transported Volume (millions RTK) 6,820 7, % 2,624 2, % Agricultural Products 4,696 4, % 1,573 1, % Soybean 2,558 2, % % Soybean meal % % Corn % % Sugar % % Fertilizers % % Wheat n/a % Rice % 1,086 1, % Industrial Products 2,124 2, % % Fuels 1,148 1, % % Wood, Pulp and Paper % % Construction % % Steel and Mining % % Others % % Vegetal Oil % % Average Transportation Yield (R$/000 RTK) % The volume transported by the South Operations totaled 3.7 billion RTK in 2Q15, in line with the volume transported in 2Q14. The 7.2% increase in agricultural product volumes was mainly driven by soybean transportation due to: (i) the resumption of operations of a grain terminal in Paranaguá; (ii) restated relationship with an important client in the state of Paraná; and (iii) record soybean crop in Rio Grande do Sul. The 46.1% increase in sugar transportation reflects the strategic decision taken by a major commodity trading company to migrate ship nominations from the Port of Santos in São Paulo to Paranaguá in Paraná.. The volume of industrial products declined 15.6% in 2Q15, mainly due to the reduction in the services of a few routes within the Malha Oeste (. those routes posed risks to operational security), and also the temporary shutdown of a refinery (REFAP) in the South region in May this year. 2Q15 2Q14 Financial Results 6M15 6M14 Chg. % Combined (Amounts in R$ MM) Combined Combined Chg. % % Net Operating Revenue % % Transportation % % Agricultural Products % % Industrial Products % (245.5) (238.8) 2.8% Costs of Services (448.5) (455.0) -1.4% % Gross Profit % 23.3% 28.6% -5.3 p.p. Gross Margin (%) 18.3% 23.4% -5.1 p.p. (16.5) (16.9) -2.2% Selling, General and Administrative Expenses (37.6) (31.6) 19.1% 2.1 (1.3) n/a Other Operational Revenues (Expenses) and Equity Pickup (6.7) (1.1) n/a % Total EBITDA % 33.5% 36.9% -3.4 p.p. EBITDA Margin (%) 27.5% 33.5% -6.0 p.p. Net revenues from South Operations amounted to R$320.2 million in 2Q15, down 4.3% from 2Q14. The reduction was due to lower transportation volumes (-0.6%), mainly of industrial products, combined with a 3.7% reduction in the average tariff in the quarter. Note that, the company did not follow the reduction in road freight prices occurred in May last year, thereby creating a strong comparison basis for the 2Q15. The cost of services provided increased 2.8% and reached R$245.5 million in 2Q15. This increase reflects mainly the hike in diesel prices (10.6%) during the, as well as the increase in maintenance and personnel expenses in accordance with the new accounting policies adopted. The EBITDA of the South Operations declined 13.1% yearly to R$ million, mainly due to: i) the drop in the transportation of industrial volumes, especially fuels; ii) the lower average transportation yield; and iii) the temporary shutdown of REFAP. 7 of 84

8 Earnings Release 2 nd Quarter of Container Operations 2Q15 2Q14 Operational Figures 6M15 6M14 Chg. % Combined Combined Combined Chg. % 20,804 18, % Total Volume (Containers '000) 40,570 34, % % Total Volume (millions RTK) 1,107 1, % % Average Yield (R$ '000/containers) % The volume of transported containers grew 12.1% in 2Q15, equivalent to a 2.3% increase in terms of RTK (574 million RTK). This increase reflects operating gains in the two main corridors - North and Central Paraná - where most of the investments were concentrated and where Brado has been gaining market share. 2Q15 2Q14 Chg. % Financial Results 6M15 6M14 Chg. % Combined (Amounts in R$ MM) Combined Combined % Net Operating Revenue % (95.3) (68.0) 40.2% Costs of Services (185.8) (143.1) 29.8% (12.5) 4.6 n/a Gross Profit (16.6) (5.7) n/a -15.1% 6.3% p.p. Gross Margin (%) -9.8% -4.1% -5.7 p.p. (14.4) (13.2) 9.2% Selling, General and Administrative Expenses (27.8) (27.7) 0.6% % Other Operational Revenues (Expenses) and Equity Pickup % (11.9) 5.0 n/a Total EBITDA (12.9) (2.3) n/a -14.4% 6.9% p.p. EBITDA Margin (%) -7.6% -1.7% -6.0 p.p. Net revenues reached R$82.8 million in 2Q15, due to the higher volume of containers handled and 1.8% increase in the average yield. The cost of services provided increased 40.2% when compared to 2Q14, reaching R$95.3 million. This increase was due to the higher transported volumes, the increase in electricity costs, the hike in diesel prices and the increase in maintenance and personnel expenses. Selling, general and administrative expenses increased 9.2% in 2Q15 to R$14.4 million, mainly reflecting expenses with the contracting of financial consulting services in the quarter. The EBITDA from Container Operations was a negative R$11.9 million in 2Q15, impacted by the increase in costs and expenses in the period. 8 of 84

9 Earnings Release 2 nd Quarter of 5. Other Result Items Breakdown of Costs of Services Provided 2Q15 2Q14 Costs 6M15 6M14 Chg. % Combined (Amounts in R$ MM) Combined Combined Chg. % (766.0) (696.4) 10.0% Costs of Services (1,468.6) (1,338.2) 9.7% (183.2) (161.2) 13.6% Fuels and Lubricants (336.9) (282.2) 19.4% (176.8) (171.7) 3.0% Depreciation and Amortization (349.3) (337.4) 3.5% (85.6) (98.1) -12.7% Logistics Cost (188.3) (177.4) 6.2% (65.0) (6.5) n/a Maintenance (77.8) (18.8) n/a (112.3) (95.5) 17.5% Payroll Expenses (212.1) (181.7) 16.7% (47.4) (45.6) 4.0% Leasing and Concession (93.5) (92.8) 0.8% (13.9) (17.6) -21.2% Operational Leasing (25.6) (34.6) -26.0% (19.2) (21.7) -11.5% Third Paties Services (35.5) (50.2) -29.3% (62.8) (78.6) -20.2% Other Operational Costs (149.6) (163.1) -8.3% The consolidated cost of services provided increased 10.0% in 2Q15 to R$ million, due to: (i) higher spending with diesel and lubricants due to the increase in average prices (10.6% hike in diesel prices) and the higher consumption; and (ii) higher maintenance and personnel costs following the adoption of new accounting policies. Those factors were partially offset by the decrease in logistics costs (road and other railroads) on account of lower volume of sugar transported in the quarter, as well as the decrease in costs with operating lease due to the reclassification of an operating lease agreement as a financial lease in December. Financial Result 2Q15 2Q14 Financial Results 6M15 6M14 Chg. % Combined (Amounts in R$ MM) Combined Combined Chg. % (207.8) (154.1) 34.8% Gross Debt Charges (395.3) (336.3) 17.6% % Income from Financial Investments % (174.5) (106.3) 64.2% (=) Subtotal: Net Debt Interests (315.1) (216.6) 45.5% (62.2) (116.5) -46.6% Other Charges and Monetary Variation (112.1) (149.0) -24.8% (15.9) (10.7) 48.4% Gain (loss) with derivatives n/a (0.1) 8.3 n/a Exchange Rate Variation (83.6) (12.8) n/a (75.9) (93.7) -19.0% Interest over finance leases and lease and concession related liability (191.4) (187.1) 2.3% (328.5) (318.8) 3.0% (=) Financial, Net (664.5) (559.6) 18.8% The financial result of 2Q15 reflects a 3.0% increase in expenses compared to 2Q14, due to: (i) the increase in gross debt charges following the increase on outstanding balance and the hike in interest rates (CDI and TJLP); (ii) lower returns from financial investments due to the reduction in the average cash balance, despite the hike in interest rates (CDI). Those effects were partially offset by the reduction in financial transactions involving suppliers and non-recurring banking expenses in. Income Tax and Social Contribution 2Q15 2Q14 Income Tax and Social Contribution 6M15 6M14 Chg. % Combined (Amounts in R$ MM) Combined Combined Chg. % % Income (loss) before income tax (115.5) 81.2 n/a 34% 34% n/a Theoretical rate - income tax 34% 34% n/a (27.7) (16.6) n/a Income Theoretical Tax Expenses 39.3 (27.6) n/a Adjustments to calculate the effective rate (27.3) (0.1) n/a Tax losses not recognized³ (126.8) (26.0) n/a % The operating profit of North Network % % Other effects (1.3) 1.8 n/a (44.8) 1.1 n/a Income Tax Expenses (71.3) (22.3) n/a -54.9% 2.3% p.p. Effective rate - current (%) 61.7% -27.5% 89.2 p.p. Note 3: We did not constitute IR / CS deferred tax losses from specific companies due to the lack of future taxable income to compensate them. Note 4: On May 30,, the North Network was granted with the extension of the right to a 75% reduction of income tax and surcharges until 2023 (SUDAM benefit). 9 of 84

10 Earnings Release 2 nd Quarter of 6. Loans and financing The total gross bank debt at the end of the 2Q15 was R$8.0 billion, up 2.7% from 2Q14 and implying a net debt/ebitda of 4.97x considering an EBITDA of R$1,425.6 million over the last 12 months. The main transactions during the period were (i) the raining of R$1.4 billion of private debentures and R$247.3 million of BNDES loans under the FINAME facility; (ii) early settlement of the 8 th and 9 th series of ALL debentures in the amount of R$1.3 billion, as well as other amortizations of FINEM contracts. The 3.5% increase of the net debt balance is due to the increase in funding needs during the quarter and the interest provision. All the foreign currency-denominated debt of Rumo ALL is hedged against the exchange variation. Total Indebtness 2Q15 1Q15 Chg. % (Amounts in R$ MM) Combined Commercial Banks % NCE % BNDES 3, , % Debentures 2, , % Total Gross Bank Debt 7, , % Cash and Cash Equivalents and Securities (874.8) (910.8) -4.0% Net Bank Debt 7, , % Leverage (Net debt / EBITDA ICVM 527) 4.97x 4.93x The following table is a breakdown of the items that impacted the cash position and consolidated debt transactions of Rumo ALL. Indebtedness (Amounts in R$ MM) 2Q15 Opening Balance of Gross Debt Rumo ALL 7.759,0 Cash and cash equivalents and marketable securities (910,8) Bank Net Indebtedness (Net of MTM) 6.848,2 Items Items with impact on cash (1,1) Funding 1.637,3 Amortization of principal (1.377,8) Amortization of interest rates (260,6) Items without impact on cash 207,8 Provision for interest rates (accrual) 207,8 0,0% Closing balance of gross indebtedness 7.965,7 Cash and cash equivalents and marketable securities (874,8) Closing Balance of Bank Net Debt Rumo ALL 7.090,9 Rumo ALL has covenants in most of its loans and financing agreements, based on specific financial and non-financial indicators. The financial indicators are: (i) consolidated net bank debt/ebitda; (ii) EBITDA/consolidated financial result (considering only interest on debentures, loans/financing and hedge operations); (iii) shareholders' equity/net assets. We note that item (iii) is exclusive for BNDES. For all our loans and financing agreements with the exception of BNDES, that requires annual measurements, we have to calculate all those indicators every quarter as of the date of the financial statements, using the consolidated results. As mentioned in ALL's earnings results of December, the net debt/ebitda covenants were renegotiated to 5.5 times with all creditors, except with the BNDES. The bank, however, which has until now only granted consent to the non-compliance with covenants on December 31, thus far. We are discussing those covenants with the BNDES, applying to the fiscal year ending on December 31,. 10 of 84

11 Earnings Release 2 nd Quarter of 7. Capex 2Q15 2Q14 Investments 6M15 6M14 Chg. % Combined (Amounts in R$ MM) Combined Combined Chg. % % Total Investments % % Recurring % n/a Expansion n/a The recurring Capex reached R$172.5 million, down 39.6% from 2Q14, mainly due to the allocation of approximately R$70 million worth of costs with maintenance of the rail structure and rolling stock, now considered maintenance expenses (Opex) under the new accounting practices. From this quarter on, recurring investments are related to maintenance of rolling stock, rail structure and operational technology, whose benefits exceed 12 months. In 2Q15, the expansion Capex reached R$390.3 million, in line with the 18-month Investment Plan. The expenses were mainly concentrated on: (i) the acquisition of new GE AC44 locomotives (non-cash transaction through financial leasing); (ii) improvements in stretches of the rail structure (for more details, see the Operating Improvements section); and (iii) improvements in the access to the Ports of Santos and Paranaguá. There were also costs related to the reconstruction of Warehouse X in the Port of Santos, damaged by fire in August. 8. Cash Generation The following table shows the cash flow in 2Q15 considering the combined cash of Rumo ALL in the quarter. Securities were considered as cash and cash equivalents in this statement. Indirect Cash Flows (Amounts in R$ MM) 2Q15 EBITDA Non-Cash Effects 40.0 Working Capital Variation (132.8) Operating Financial Result 9.3 (a) (=) Operating Cash Flows Total Capex (471.6) (b) Recurring (172.5) Expansion 5 (299.2) (c) (=) Cash flows from investments (471.6) Funding 1,637.3 Amortization of principal/interest rates (1,799.3) Restricted cash and derivatives 94.3 (d) (=) Financial cash flows (67.7) (=) Generation (Consumption) total cash (35.9) (+) Cash and cash equivalents + marketable securities, opening balance Rumo ALL Combined (=) Cash and cash equivalents + marketable securities, closing balance Rumo ALL Combined Metrics (=) Cash generation after recurring Capex (a+ b) (=) Cash generation after Total Capex (a+ c) 31.8 (=) Generation (Consumption) total cash (a+c+d) (35.9) Note 5: During the quarter, 12 locomotives were acquired through an operation accounted for as financial lease, totaling R$ 91.9 million (during the semester, we acquired 24 locomotives in a total amount of R$ through the same operation). Considering this non-cash effect, the Expansion Capex in the quarter was R$ million (R$ million in 6M15). 11 of 84

12 Earnings Release 2 nd Quarter of 9. Operational improvements In this section we describe a set of improvements already implemented in the North and South Operations, as part of the 18-month Investment Plan. The pictures show: (i) the acquisition of rolling stock; (ii) the retrofit of railcars and locomotives; (iii) improvements to the rail structure; and (iv) improvements in terminals and ports. Those initiatives already contributed to the better performance by Rumo ALL operations. New rolling stock: GE AC44 locomotives and Maxion HPT freight cars Retrofit of rolling stock: Renovated SD 40 and B12 locomotives and freight cars The new retrofit standard applied in our sites in Curitiba, Paraná, provides greater reliability to our operations, resulting on higher productivity and yields. The cabins were fully refurbished and equipped with CCTV. The railcars were thoroughly revamped and sealed, fitted with new bearings, clamps, springs and wedges. 12 of 84

13 Earnings Release 2 nd Quarter of North Operations The North Operations reached record production in May. The corridor handled billion RTK, mainly due to the improvements made. In the same month, the corridor posted record levels of locomotive reliability, with a reduction of 300% in the expected vehicle breaks for the period. Out of 43 units ordered, 24 GE AC44 locomotives were already delivered. We ordered 355 HPT railcars, expected to be delivered during the second half of the year. We are also making improvements to the existing fleet - 32 C30 locomotives are expected to be retrofitted, of which 3 have been completed and are currently in operation. There was a 9% reduction in transit time from Rondonópolis to the Port of Santos during the 2Q15. This improvement represents a gain of about 9 hours and is mainly due to: (i) the new operational layout at Tutóia, the largest rail yard of Rumo ALL, located in Araraquara, São Paulo, allowing empty railcars to transit in separated areas, improving the efficiency; (ii) the addition of new locomotives; and (iii) the higher availability and reliability of the rail structure for rail cars. We are improving the rail infrastructure, the urban stretches and the Freight Car Maintenance Stations (PMV). We replaced 48,000 sleepers on the stretches between Catanduva and Embu-Guaçu, located in São Paulo and enhanced the support services, increasing the safety and productivity of the railcars in transit. Various improvements were made in the urban regions, such as replacement of damaged sleepers and drainage of the sites. The PMVs were renewed, speeding ending up the assets maintenance processes. Improvements in the Port of Santos Modernization and interconnection of terminals and rebuilding work on Warehouse X Improvements in the rail structure - Catanduva and Embu-Guaçu Stretches (SP) Replacement of sleepers and infrastructure services 13 of 84

14 Earnings Release 2 nd Quarter of South Operations The transit time between the north of Paraná (Maringá and Londrina) and the access to the ports of Paranaguá and São Francisco was reduced by approximately 8% in the 2Q15, compared to 2Q14. In the first six months of the year, the reduction was of approximately 2 hours when compared to the same period of the previous year, following the assets renewal and rail and ports infrastructure improvements in the South Operations. We are already investing in rail infrastructure. Rumo took over the operation of an important bulk terminal in the Port of Paranaguá back in April. The refurbishment of this terminal is expected to be completed by the end of so that it can operate at full capacity in The refurbishment includes the addition of lines and the replacement of tracks and sleepers. In the urban regions of Maringá and Londrina, the are work being carried to improve the transit in the stretches. The scenario for the 2 nd half of the year is even more promising. 377 HPE railcars were acquired, to be delivered during the second half of the year. For 2016 and 2017, 47 locomotives were ordered for replacement. The model was exclusively designed by GE for the South Corridor, where most of the stretches have narrow gauges. Improvements in the Port of Paranaguá Improvements in the rail structure Stretches in Maringá and Londrina (Paraná) Improvements in urban regions and infrastructure, as well as replacement of tracks and sleepers 14 of 84

15 Earnings Release 2 nd Quarter of 10. Guidance This section contains the guidance ranges of some of the main parameters affecting the consolidated results of Rumo ALL for. Please note that other sections of this Earnings Release may contain projections too. Those projections and guidance are mere estimates and indications, and should not be taken as a guarantee of future results. Rumo ALL Updated EBITDA (R$ MM) Total Capex (R$ MM) Capex Recurring (R$ MM) Capex Expansion (R$ MM) We revised our guidance to better reflect our estimates for remainder of, reflecting the evolution of our operations during the first half of the year. EBITDA: we narrowed guidance range by adjusting our projections based on the performance of the first six months of the year and to our expectations for the second half of. Capex: we narrowed the guidance range after adjusting our projections and revising the criteria base on which we classify certain projects as investments in expansionwe therefore reclassified approximately R$ 100 million previouly treated as recurring capex to expansion capex. Disclaimer This document contains forward-looking statements and information. These forward-looking statements and information are solely forecasts and are not guarantees of future performance. All stakeholders are advised that these forward-looking statements and information are and will be, as applicable, subject to risks, uncertainties and factors related to the operations and business environment of Cosan and its subsidiaries, and hence actual results of these companies could differ significantly from the future results expressed or implied by said forward-looking statements and information. 15 of 84

16 Earnings Release 2 nd Quarter of 11. Opening Balance Sheet - Rumo ALL After Rumo acquired ALL, an Opening Balance Sheet of Rumo ALL was prepared on April 1,, to record properly record the fair value of: (i) the price paid for the acquisition of ALL; as well as (ii) the underlying assets acquired and liabilities assumed. A. Price Paid The fair value of the price paid was calculated by multiplying the number of ALL outstanding shares on the date before the merger by the closing price of the stock on the BM&FBovespa on March 31, (R$3.97 per share), adjusted for the termination of the pre-existing relationship between Rumo and ALL. The liquidation of the pre-existing relationship between Rumo and ALL reflects the difference between the value of the investment made by Rumo and the discounted future cash flows of such investment, considering the contracted volumes and tariffs. This amount was recognized in the income statement of 2Q15 as "other operating income" in the amount of R$29.8 million. (in R$ million) Common shares acquired of ALL ( ) R$ 3.97 R$ 2,707.5 Contract settlement Rumo R$ 29.8 Paid price R$ 2,737.4 B. Fair value of assets acquired and liabilities assumed We highlight the following items in determining the fair value of the assets acquired and liabilities assumed. Reduction on fair market value of PP&E: ALL's property, plant and equipment was valued at fair value using the replacement cost method, resulting on a R$1.5 billion reduction, mainly due to previous capitalization practices for the cost of improvements, as well as the lack of individualized control of fixed assets, enabling the appropriate depreciation throughout the remaining life of assets. Revised estimate and fair value of lawsuits: we revised the estimate of ALL's contingencies to adjust them to Rumo's provisioning criteria. The revision of contingencies considered: (i) the present value of the lawsuits, (ii) review of the risk of losing each lawsuit; (iii) detailed analysis of the defense proposed; (iv) any review of the defense strategy; and (v) the phase of the lawsuit. This revision led to an increase of R$268.3 million in the provision for lawsuits, nowtotalling R$554.3 million. Intangible assets public concession rights: the ALL asset base comprises the concession rights to provide railroad services. The price paid for the company, adjusted for other net assets, therefore reflects the amount paid for such concessions, totaling R$7.5 billion. Given the fact that the present value of the cash flows from Malha Norte represents the majority of the fair value, the concession right was allocated to the Malha Norte and will be amortized throughout the remainder of the concession term (until 2079). Other adjustments: Other adjustments were made to align previous accounting practices to those adopted by Rumo s practices, such as: (i) a review of the criteria applied to bad debt provision and and inventory obsolescence; (ii) probability of recoverable taxes, (iii) provision for environmental remediation; and (iv) deferred taxes on those adjustments, among others. It is important to note that the adjustments made after determining the fair value of the assets acquired and liabilities assumed did not affect the results of Rumo ALL. The adjustments were made within the scope of the acquisition process. The effects contributed to the formation of the intangible concession rights. Since the fair value of the net assets and liabilities acquired by Rumo were equivalent to the price paid for ALL, the acquisition did not generate any goodwill. The fair value of assets and liabilities is still preliminary. As per the IFRS3 rules, the management has up to 12 months from the acquisition date to complete this measurement. If new information is obtained about facts and circumstances that existed on the acquisition date, the fair values will be revised without impacting the results of Rumo ALL. 16 of 84

17 Earnings Release 2 nd Quarter of 12. Appendices 12.1 Financial Statements of Rumo ALL Balance Sheet Balance Sheet (Amounts in R$ MM) ALL PPA ALL Opening Published Effects 6 Balance Sheet Rumo Eliminations Rumo ALL Rumo ALL Current Cash and cash equivalents Securities Trade receivables (51.5) (220.4) Inventories (21.1) Peer company receivables Income tax and social contribution Other taxes recoverable (111.3) Dividends and interest on capital Other assets (13.0) ,945.1 (196.8) 1, (220.4) 1, ,599.4 Non-current Trade receivables (509.7) Restricted cash Deferred income tax and social contribution 1, , , ,344.7 Income tax and social contribution Other taxes recoverable Judicial deposits Derivative financial instruments Other assets Investments Property and equipment 8,741.5 (1,516.4) 7, , , ,813.9 Intangible 2, , , (498.2) 7, , , , , ,573.2 (1,007.9) 19, ,385.2 Total Assets 15, , , ,648.5 (1,228.2) 20, ,984.7 Current Borrowings 4, , , ,094.3 Leases Advances on real estate credits Derivative financial instruments Trade accounts payable (561.9) Labor and social security obligations Taxes and social security contributions payable Other payable taxes Leases and concessions Dividends and interest on capital Related parts Tax installments Deferred revenue (222.5) Other payables (36.2) , , (820.6) 5, ,903.2 Non - current Borrowings 2, , , ,871.5 Leases 1, , , ,350.3 Advances on real estate credits Derivative financial instruments Leases and concessions 1, , , ,030.2 Provision for lawsuits Taxes and social security contributions payable - 2, , , ,714.8 Deferred income tax and social contribution Deferred revenue (407.6) Other payables , , , ,213.9 (407.6) 10, ,027.6 Equity 2, , , , ,053.8 Total Liabilities 15, , , ,648.5 (1,228.2) 20, ,984.7 Note 6: PPA: Purchase Price Allocation Income Statement 17 of 84

18 Earnings Release 2 nd Quarter of 2Q15 2Q14 6M15 6M14 Chg. % Combined (Amounts in R$ MM) Combined Combined Chg. % 1, , % Net Operating Revenue 2, , % % Gross profit % (84.2) (81.1) 3.8% Sales, General and Administrative Expenses (182.9) (161.0) 13.6% 39.8 (9.1) % Other Operating Income (Expenses), Net n/a (328.5) (318.8) 3.0% Net financial result (664.5) (559.6) 18.8% n/a Equity Pickup % (44,8) 1,1 n/a Income Tax and Social Contribution (71.3) (22.3) n/a (3.6) % Discontinued Operations (6.1) (1.1) n/a % Net Profit (losse) (192.8) 57.7 n/a Cash Flow Cash Flow (Accounting) Rumo ALL (Amounts in R$ MM) 2Q15 2Q14 6M15 6M14 Cash flow from operating activities Profit before income tax and social contribution Adjustments: Depreciation and amortization Equity (0.2) - (0.2) - Provision for interest in the results of investees Gain on disposal of declared dividends Loss (gaing) on disposal of permanent assets Provision (reversal) for losses on doubtful accounts (0.7) Others Interest, monetary and exchange variations, net Variation in: Accounts receivable 0.8 (58.5) (41.0) (71.4) Advances from customers (9.7) 4.2 (20.8) 2.5 Judicial deposits (16.3) (4.1) (16.2) (20.4) Related parties (24.7) 9.8 (30.2) 10.5 Taxes and contributions recoverable 4.9 (5.1) (3.4) (8.4) Taxes and contributions payable (24.4) (2.8) (25.2) (28.8) Inventories (15.6) (0.1) (16.6) (0.1) Labor and social security obligations (4.6) (4.2) Trade accounts payable Advances to suppliers (25.9) (0.1) (26.1) (0.2) Contingencies (5.0) (0.1) (5.4) (0.4) Other assets and liabilities, net (33.7) (10.8) (26.0) (19.9) (132.8) (40.2) (201.0) (139.9) Cash generated by (used in) operations Cash flow from investing activities Addition to property, software and other intangibles (471.6) (83.8) (502.6) (97.7) Securities Restricted cash Net cash acquired in business acquisition Cash generated by (used in) investing activities (44.0) (83.8) (75.0) (97.7) Cash flow from financing activities Borrowings 1, , Payment of borrowings (1,494.2) (28.0) (1,525.3) (41.2) Payment of interest on borrowings (305.1) (6.4) (316.2) (27.8) Derivative financial instruments Dividends payable - (125.0) (300.0) (125.0) Cash generated by (used in) financing activities (142.4) (159.4) (170.8) (186.5) Increase (decrease) in cash and cash equivalents (240.6) (275.4) Beginning balance of cash and cash equivalents Final balance of cash and cash equivalents of 84

19 Earnings Release 2 nd Quarter of 12.2 Financial Statements of Cosan Logística Balance Sheet Balance Sheet Cosan Logística (Amounts in R$ MM) 2Q15 1Q15 Current Cash and cash equivalents Securities Trade receivables Inventories Peer company receivables Income tax and social contribution Other taxes recoverable Dividends and interest on capital - - Other assets , Non-current Trade receivables Restricted cash Deferred income tax and social contribution 1, Income tax and social contribution Other taxes recoverable Judicial deposits Derivative financial instruments Other assets Investments Property and equipment 8, ,139.4 Intangible 7, , ,573.2 Total Assets 21, ,876.1 Current Borrowings 1, Leases Advances on real estate credits Derivative financial instruments Trade accounts payable Labor and social security obligations Taxes and social security contributions payable Other payable taxes Dividends and interest on capital Leases and concessions Related parts Deferred revenue Other payables , Non - current Borrowings 6, Leases 1, Advances on real estate credits Derivative financial instruments Taxes and social security contributions payable Provision for lawsuits Leases and concessions 2, Deferred income tax and social contribution 2, Deferred revenue Other payables , ,213.9 Equity 4, ,262.6 Total Liabilities 21, , of 84

20 Earnings Release 2 nd Quarter of Income Statement 2Q15 2Q14 Chg. % Cosan Logística (Amouts in R$ MM) 6M15 6M14 Chg. % 1, n/a Net Operating Revenue 1, n/a n/a Gross profit n/a (84.8) (22.8) n/a Sales, General and Administrative Expenses (109.2) (42.7) n/a 39.8 (8.2) n/a Other Operating Income (Expenses), Net n/a (323.0) (23.9) n/a Net financial result (343.4) (20.0) n/a n/a Equity Pickup n/a (46.6) (2.4) n/a Income Tax and Social Contribution (51.4) (27.7) n/a (3.6) - n/a Discontinued Operations (3.6) - n/a n/a Net Profit (losse) n/a Cash Flow Cash Flow Cosan Logística (Amounts in R$ MM) 2Q15 2Q14 6M15 6M14 Cash flow from operating activities Profit before income tax and social contribution Adjustments: Depreciation and amortization Equity (0.2) - (0.2) - Stock option Provision for interest in the results of investees Gain on disposal of declared dividends (18.6) Loss (gaing) on disposal of permanent assets Provision for lawsuits Provision (reversal) for losses on doubtful accounts (0.7) Others Interest, monetary and exchange variations, net Variation in: - - Accounts receivable 1.8 (58.5) (39.9) (71.4) Advances from customers (9.7) 4.2 (20.8) 2.5 Judicial deposits (16.3) (4.1) (16.2) (20.4) related parties (13.7) 9.8 (19.2) 10.5 Taxes and contributions recoverable 4.0 (5.1) (4.3) (8.4) Taxes and contributions payable (26.4) (2.8) (27.7) (28.8) Inventories (15.6) (0.1) (16.6) (0.1) Labor and social security obligations (4.6) (4.2) Suppliers Advances to suppliers (25.9) (0.1) (26.1) (0.2) Contingencies (5.0) (0.1) (5.4) (0.4) Other assets and liabilities, net (33.6) (10.8) (25.9) (19.9) (135.6) (40.2) (204.3) (139.9) Cash generated by (used in) operations Cash flow from investing activities - - Addition to property, software and other intangibles (471.6) (83.8) (502.6) (97.7) Securities Restricted cash Acquisitions, net of cash acquired Cash generated by (used in) investing activities (44.0) (83.8) (75.0) (97.7) - - Cash flow from financing activities - - Borrowings 1, , Payment of borrowings (1,494.2) (28.0) (1,525.3) (41.2) Payment of interest on borrowings (305.1) (6.4) (316.2) (27.8) Derivative financial instruments Purchase of non-controlling shares of Rumo (25.1) - (25.1) - Dividends payable (24.5) (125.0) (99.5) (125.0) Purchase of treasury shares (12.2) - (12.2) - Cash generated by (used in) financing activities (204.2) (159.4) (7.6) (186.5) - - Increase (decrease) in cash and cash equivalents (240.6) (275.4) - - Beginning balance of cash and cash equivalents Final balance of cash and cash equivalents of 84