UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
Report of Foreign Issuer
Pursuant To Rule 13a-16 Or 15d-16 of the
Securities Exchange Act of 1934
For the month of May 2021
Commission File Number: 333-251238
|
COSAN S.A.
(Exact name of registrant as specified in its charter)
N/A
(Translation of registrant’s name into English)
|
Av. Brigadeiro Faria Lima, 4100, – 16th floor
São Paulo, SP 04538-132 Brazil
(Address of principal executive offices)
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40‑F:
Form 20-F ☒ Form 40-F ☐
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):
Yes ☐ No ☒
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7):
Yes ☐ No ☒
A free translation from Portuguese into English of Independent Auditor’s Review Report on Interim Financial Information prepared in Brazilian currency in accordance with NBC TG 21 and IAS 34 and the rules issued by the Brazilian Securities Commission (CVM), applicable to the preparation of Quarterly Information (ITR) |
To
Shareholders, Board of Director and Officers of
Cosan S.A.
São Paulo - SP
Introduction
We have reviewed the accompanying individual and consolidated interim financial information, contained in the Quarterly Information Form (ITR) of - Cosan S.A. (“Company”) for the quarter ended March 31, 2021, comprising the statement of financial position as of March 31, 2021 and the related statements of profit or loss, of comprehensive income, of changes in equity and of cash flows for the three month period then ended, including the explanatory notes.
Management is responsible for preparation of the individual and consolidated interim financial information in accordance with Accounting Pronouncement NBC TG 21 - Demonstrações intermediárias, and IAS 34 - Interim Financial Reporting, issued by the International Accounting Standards Board (IASB), as well as for the fair presentation of this information in conformity with the rules issued by the Brazilian Securities and Exchange Commission (CVM) applicable to the preparation of the Quarterly Information Form (ITR). Our responsibility is to express a conclusion on this interim financial information based on our review.
Scope of review
We conducted our review in accordance with Brazilian and international standards on review engagements (NBC TR 2410 - Revisão de Informações Intermediárias Executada pelo Auditor da Entidade and ISRE 2410 - 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 and the consolidated interim financial information
Based on our review, nothing has come to our attention that causes us to believe that the accompanying individual and consolidated interim financial information included in the quarterly information referred to above are not prepared, in all material respects, in accordance with NBC TG 21 and IAS 34 applicable to the preparation of Quarterly Information Form (ITR), and presented consistently with the rules issued by the Brazilian Securities and Exchange Commission.
Emphasis of matter
Restatement of Earnings per share
As mentioned in Note 16, due to the share split, the Company adjusted earnings per share and the related notes correspondents for the thee-month period ended March 31, 2020, as provided for in Brazilian Accounting Standard CPC 41 – Resultado por ação / IAS 33 – Earnings per share. Our conclusion is not qualified in respect of this matter.
Other matters
Statements of value added
The abovementioned quarterly information includes the statement of value added (SVA) for the three-month period ended March 31, 2021, prepared under Company’s Management responsibility and presented as supplementary information by IAS 34. These statements have been subject to review procedures performed together with the review of the quarterly information with the objective to conclude whether they are reconciled to the interim financial information and the accounting records, as applicable, and if its format and content are in accordance with the criteria set forth by NBC TG 09 - Demonstração do Valor Adicionado. Based on our review, nothing has come to our attention that causes us to believe that they were not prepared, in all material respects, consistently with the overall interim financial information.
São Paulo, May 14, 2021.
ERNST & YOUNG
Auditores Independentes S.S.
CRC-2SP034519/O-6
/s/Marcos Alexandre S. Pupo |
Marcos Alexandre S. Pupo |
Accountant CRC-1SP221749/O-0 |
|
|
| Parent Company |
| Consolidated | ||||
| Note |
| March 31, 2021 |
| December 31, 2020 |
| March 31, 2021 |
| December 31, 2020 |
Assets |
|
|
|
|
|
|
|
|
|
Cash and cash equivalents | 5.1 |
| 1,249,667 |
| 1,149,267 |
| 7,933,170 |
| 4,614,053 |
Marketable securities | 5.2 |
| 844,191 |
| 788,965 |
| 3,735,659 |
| 2,271,570 |
Trade receivables | 5.3 |
| — |
| — |
| 2,285,407 |
| 1,585,708 |
Derivative financial instruments | 5.10 |
| 86,858 |
| — |
| 382,585 |
| 156,208 |
Inventories | 7 |
| — |
| — |
| 961,975 |
| 685,900 |
Receivables from related parties | 5.5 |
| 130,865 |
| 286,993 |
| 94,402 |
| 71,783 |
Income tax receivable |
|
| 150,766 |
| 141,018 |
| 261,698 |
| 178,501 |
Other current tax receivable | 6 |
| 35,525 |
| 35,507 |
| 675,385 |
| 434,480 |
Dividends receivable |
|
| 177,032 |
| 160,694 |
| 102,592 |
| 77,561 |
Sector financial assets | 5.9 |
| — |
| — |
| 184,105 |
| 241,749 |
Other financial assets | 5.4 |
| — |
| 779,695 |
| 69,381 |
| 848,821 |
Other current assets |
|
| 117,683 |
| 101,673 |
| 396,752 |
| 270,065 |
Total current assets |
|
| 2,792,587 |
| 3,443,812 |
| 17,083,111 |
| 11,436,399 |
Trade receivables | 5.3 |
| — |
| — |
| 25,995 |
| 19,131 |
Restricted cash | 5.2 |
| 30,012 |
| — |
| 59,872 |
| — |
Deferred tax assets | 13 |
| 251,591 |
| 54,032 |
| 2,150,103 |
| 629,591 |
Receivables from related parties | 5.5 |
| 575,972 |
| 473,349 |
| 283,064 |
| 199,983 |
Income tax receivable |
|
| — |
| — |
| 145,791 |
| 836 |
Other non-current tax receivable | 6 |
| 37,651 |
| 37,533 |
| 978,329 |
| 167,224 |
Judicial deposits | 14 |
| 385,292 |
| 380,727 |
| 884,403 |
| 544,226 |
Derivative financial instruments | 5.10 |
| 3,089,713 |
| 2,457,604 |
| 5,850,020 |
| 2,971,210 |
Other non-current assets |
|
| 170,936 |
| 165,310 |
| 297,633 |
| 227,857 |
Investments in associates | 8.1 |
| 16,250,838 |
| 11,026,580 |
| 382,640 |
| 333,705 |
Investments in joint ventures | 9 |
| 2,259,602 |
| 2,314,537 |
| 8,145,564 |
| 7,988,208 |
Property, plant and equipment | 10.1 |
| 62,722 |
| 61,459 |
| 14,680,228 |
| 416,996 |
Intangible assets and goodwill | 10.2 |
| 2,022 |
| 2,191 |
| 17,503,169 |
| 10,045,296 |
Contract asset | 10.3 |
| — |
| — |
| 602,093 |
| 695,938 |
Right-of-use assets | 10.4 |
| 32,460 |
| 24,809 |
| 7,885,307 |
| 84,224 |
Total non-current assets |
|
| 23,148,811 |
| 16,998,131 |
| 59,874,211 |
| 24,324,425 |
Total assets |
|
| 25,941,398 |
| 20,441,943 |
| 76,957,322 |
| 35,760,824 |
The accompanying notes are an integral part of these interim financial statements..
|
|
| Parent Company |
| Consolidated | ||||
| Note |
| March 31, 2021 |
| December 31, 2020 |
| March 31, 2021 |
| December 31, 2020 |
Liabilities |
|
|
|
|
|
|
|
|
|
Loans, borrowings and debentures | 5.6 |
| 44,863 |
| — |
| 2,413,080 |
| 2,352,057 |
Leases | 5.8 |
| 7,070 |
| 11,108 |
| 533,515 |
| 20,466 |
Derivative financial instruments | 5.10 |
| 569 |
| 7,291 |
| 225,870 |
| 293,656 |
Trade payables | 5.7 |
| 1,323 |
| 4,066 |
| 2,309,971 |
| 1,875,192 |
Employee benefits payables |
|
| 14,285 |
| 25,168 |
| 262,518 |
| 195,881 |
Income tax payables |
|
| 6,909 |
| 2,571 |
| 88,421 |
| 374,339 |
Other taxes payable | 12 |
| 109,828 |
| 125,368 |
| 427,666 |
| 367,076 |
Dividends payable |
|
| 68,899 |
| 216,929 |
| 147,214 |
| 285,177 |
Concessions payable | 11 |
| — |
| — |
| 159,745 |
| — |
Payables to related parties | 5.5 |
| 193,655 |
| 278,740 |
| 366,835 |
| 150,484 |
Sector financial liabilities | 5.9 |
| — |
| — |
| 92,386 |
| 91,912 |
Other financial liabilities |
|
| — |
| — |
| 509,656 |
| 149,293 |
Other current liabilities |
|
| 95,450 |
| 103,501 |
| 388,399 |
| 259,580 |
Total current liabilities |
|
| 542,851 |
| 774,742 |
| 7,925,276 |
| 6,415,113 |
Loans, borrowings and debentures | 5.6 |
| 5,971,015 |
| — |
| 34,162,954 |
| 13,075,170 |
Leases | 5.8 |
| 30,544 |
| 17,037 |
| 2,553,675 |
| 59,297 |
Preferred shareholders payable in subsidiaries |
|
| 391,187 |
| 387,044 |
| 391,187 |
| 387,044 |
Derivative financial instruments | 5.10 |
| 114,599 |
| 124,171 |
| 114,599 |
| 124,171 |
Other taxes payable | 12 |
| 140,827 |
| 141,233 |
| 148,397 |
| 146,895 |
Provision for legal proceedings | 14 |
| 312,708 |
| 308,819 |
| 1,394,453 |
| 887,794 |
Concessions payable | 11 |
| — |
| — |
| 2,855,739 |
| — |
Provision for uncovered liability of associates | 8.1 |
| 331,041 |
| 458,852 |
| — |
| — |
Payables to related parties | 5.5 |
| 7,745,942 |
| 7,096,139 |
| — |
| — |
Post-employment benefits | 21 |
| 181 |
| 177 |
| 734,291 |
| 728,677 |
Deferred tax liabilities | 13 |
| — |
| — |
| 3,680,685 |
| 1,271,208 |
Sector financial liabilities | 5.9 |
| — |
| — |
| 511,124 |
| 473,999 |
Deferred revenue |
|
| — |
| — |
| 40,393 |
| — |
Other non-current liabilities |
|
| 289,611 |
| 286,064 |
| 805,197 |
| 685,642 |
Total non-current liabilities |
|
| 15,327,655 |
| 8,819,536 |
| 47,392,694 |
| 17,839,897 |
Total liabilities |
|
| 15,870,506 |
| 9,594,278 |
| 55,317,970 |
| 24,255,010 |
Shareholders' equity | 15 |
|
|
|
|
|
|
|
|
Share capital |
|
| 6,365,853 |
| 5,727,478 |
| 6,365,853 |
| 5,727,478 |
Treasury shares |
|
| (91,158) |
| (583,941) |
| (91,158) |
| (583,941) |
Additional paid-in capital |
|
| (2,978,460) |
| (939,347) |
| (2,978,460) |
| (939,347) |
Accumulated other comprehensive loss |
|
| (263,319) |
| (252,610) |
| (263,319) |
| (252,610) |
Retained earnings |
|
| 6,399,169 |
| 6,896,085 |
| 6,399,169 |
| 6,896,085 |
Profit for the period |
|
| 638,807 |
| — |
| 638,807 |
| — |
Equity attributable to: |
|
|
|
|
|
|
|
|
|
Owners of the Company |
|
| 10,070,892 |
| 10,847,665 |
| 10,070,892 |
| 10,847,665 |
Non-controlling interests | 8.2 |
| — |
| — |
| 11,568,460 |
| 658,149 |
Total shareholders' equity |
|
| 10,070,892 |
| 10,847,665 |
| 21,639,352 |
| 11,505,814 |
Total shareholders' equity and liabilities |
|
| 25,941,398 |
| 20,441,943 |
| 76,957,322 |
| 35,760,824 |
The accompanying notes are an integral part of these interim financial statements.
(In thousands of Brazilian Reais - R$, except earnings per share)
|
|
| Parent Company | Consolidated | |||||||||
| Note |
| March 31, 2021 |
| March 31, 2020 |
| March 31, 2021 |
| March 31, 2020 (Restated) | ||||
Net sales | 17 |
| — |
| — |
| 4,715,799 |
| 3,506,512 | ||||
Cost of sales | 18 |
| — |
| — |
| (3,369,867) |
| (2,486,377) | ||||
Gross profit |
|
| — |
| — |
| 1,345,932 |
| 1,020,135 | ||||
Selling expenses | 18 |
| — |
| — |
| (158,655) |
| (279,396) | ||||
General and administrative expenses | 18 |
| (47,337) |
| (34,922) |
| (363,608) |
| (171,225) | ||||
Other expenses, net | 19 |
| (25,040) |
| (74,548) |
| (28,926) |
| (35,954) | ||||
Operating expenses |
|
| (72,377) |
| (109,470) |
| (551,189) |
| (486,575) | ||||
Result before equity in earnings of investees, finance results and taxes |
|
| (72,377) |
| (109,470) |
| 794,743 |
| 533,560 | ||||
Interest in earnings of associates | 8.1 |
| 954,353 |
| 435,575 |
| (1,194) |
| 820 | ||||
Interest in earnings of joint ventures | 9 |
| (54,936) |
| (24,159) |
| 254,801 |
| 191,344 | ||||
Equity in earnings of investees |
|
| 899,417 |
| 411,416 |
| 253,607 |
| 192,164 | ||||
Finance expense |
|
| (202,357) |
| (291,755) |
| (171,818) |
| (748,020) | ||||
Finance income |
|
| 36,325 |
| 60,779 |
| 191,152 |
| 265,649 | ||||
Foreign exchange, net |
|
| (729,972) |
| (1,406,185) |
| (991,459) |
| (1,538,025) | ||||
Net effect of derivatives |
|
| 590,696 |
| 1,284,503 |
| 590,214 |
| 1,397,199 | ||||
Finance results, net | 20 |
| (305,308) |
| (352,658) |
| (381,911) |
| (623,197) | ||||
Profit before taxes |
|
| 521,732 |
| (50,712) |
| 666,439 |
| 102,527 | ||||
Income taxes | 13 |
|
|
|
|
|
|
|
| ||||
Current |
|
| — |
| — |
| 399,860 |
| (125,231) | ||||
Deferred |
|
| 117,075 |
| 152,962 |
| (358,036) |
| 139,409 | ||||
|
|
| 117,075 |
| 152,962 |
| 41,824 |
| 14,178 | ||||
Profit for the period |
|
| 638,807 |
| 102,250 |
| 708,263 |
| 116,705 | ||||
Profit attributable to: |
|
|
|
|
|
|
|
|
| ||||
Owners of the Company |
|
| 638,807 |
| 102,250 |
| 638,807 |
| 102,250 | ||||
Non-controlling interests |
|
| — |
| — |
| 69,456 |
| 14,455 | ||||
|
|
| 638,807 |
| 102,250 |
| 708,263 |
| 116,705 | ||||
Earnings per share | 16 | ||||||||||||
Basic |
|
|
|
|
|
| R$ | 0.3685 |
| R$ | 0.0655 | ||
Diluted |
|
|
|
|
|
| R$ | 0.3662 |
| R$ | 0.0647 |
The accompanying notes are an integral part of these interim financial statements.
(In thousands of Brazilian Reais - R$)
|
| Parent Company |
| Consolidated | ||||
|
| March 31, 2021 |
| March 31, 2020 |
| March 31, 2021 |
| March 31, 2020 |
Profit for the period |
| 638,807 |
| 102,250 |
| 708,263 |
| 116,705 |
Items that are or may subsequently be reclassified to profit or loss: |
|
|
|
|
|
|
|
|
Foreign currency translation differences |
| 244,947 |
| 563,497 |
| 272,535 |
| 610,682 |
Gain on cash flow hedge |
| (255,795) |
| (155,635) |
| (256,387) |
| (155,635) |
Change in fair value of financial assets |
| 139 |
| (1) |
| 139 |
| (1) |
|
| (10,709) |
| 407,861 |
| 16,287 |
| 455,046 |
Total comprehensive income for the period |
| 628,098 |
| 510,111 |
| 724,550 |
| 571,751 |
Total comprehensive income attributable to: |
|
|
|
|
|
|
|
|
Owners of the Company |
| 628,098 |
| 510,111 |
| 628,098 |
| 510,111 |
Non-controlling interests |
| — |
| — |
| 96,452 |
| 61,640 |
|
| 628,098 |
| 510,111 |
| 724,550 |
| 571,751 |
The accompanying notes are an integral part of these interim financial statements.
(In thousands of Brazilian Reais - R$)
|
|
|
|
|
| Capital reserve |
|
|
| Profit reserve |
|
|
|
|
|
|
|
| ||||||||
|
| Share capital |
| Treasury share |
| Corporate transactions - Law 6404 |
| Capital transactions |
| Accumulated other comprehensive loss |
| Legal |
| Statutory reserve |
| Profit to be realized |
| Retained earnings |
| Accumulated profits |
| Total |
| Non-controlling interest |
| Total equity |
At January 1, 2021 |
| 5,727,478 |
| (583,941) |
| 737 |
| (940,084) |
| (252,610) |
| 42,593 |
| 6,334,427 |
| 171,021 |
| 348,044 |
| — |
| 10,847,665 |
| 658,149 |
| 11,505,814 |
Profit for the period |
| — |
| — |
| — |
| — |
| — |
| — |
| — |
| — |
| — |
| 638,807 |
| 638,807 |
| 69,456 |
| 708,263 |
Other comprehensive income: (note 15) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss on cash flow hedge |
| — |
| — |
| — |
| — |
| (255,795) |
| — |
| — |
| — |
| — |
| — |
| (255,795) |
| (592) |
| (256,387) |
Foreign currency translation differences |
| — |
| — |
| — |
| — |
| 244,947 |
| — |
| — |
| — |
| — |
| — |
| 244,947 |
| 27,588 |
| 272,535 |
Change in fair value of financial assets |
| — |
| — |
| — |
| — |
| 139 |
| — |
| — |
| — |
| — |
| — |
| 139 |
| — |
| 139 |
Total comprehensive income for the period |
| — |
| — |
| — |
| — |
| (10,709) |
| — |
| — |
| — |
| — |
| 638,807 |
| 628,098 |
| 96,452 |
| 724,550 |
Transactions with owners of the Company |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Contributions and distributions: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital increase (Note 15) |
| 638,375 |
| — |
| — |
| (638,375) |
| — |
| — |
| — |
| — |
| — |
| — |
| — |
| 1,750 |
| 1,750 |
Cancellation of treasury shares (Note 15) |
| — |
| 496,916 |
| — |
| — |
| — |
| — |
| (496,916) |
| — |
| — |
| — |
| — |
| — |
| — |
Share options exercised |
| — |
| 645 |
| — |
| 1,543 |
| — |
| — |
| — |
| — |
| — |
| — |
| 2,188 |
| — |
| 2,188 |
Dividends |
| — |
| — |
| — |
| — |
| — |
| — |
| — |
| — |
| — |
| — |
| — |
| (3,407) |
| (3,407) |
Treasury shares acquired (Note 15) |
| — |
| (4,778) |
| — |
| — |
| — |
| — |
| — |
| — |
| — |
| — |
| (4,778) |
| — |
| (4,778) |
Corporate reorganization (Note 1.2) |
| — |
| — |
| — |
| (1,400,557) |
| — |
| — |
| — |
| — |
| — |
| — |
| (1,400,557) |
| 10,836,134 |
| 9,435,577 |
Share-based payment transactions |
| — |
| — |
| — |
| 1,564 |
| — |
| — |
| — |
| — |
| — |
| — |
| 1,564 |
| 964 |
| 2,528 |
Total contributions by and distributions to owners of the Company |
| 638,375 |
| 492,783 |
| — |
| (2,035,825) |
| — |
| — |
| (496,916) |
| — |
| — |
| — |
| (1,401,583) |
| 10,835,441 |
| 9,433,858 |
Transactions with owners of the Company |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change of shareholding interest in subsidiary (Note 8.2) |
| — |
| — |
| — |
| (3,288) |
| — |
| — |
| — |
| — |
| — |
| — |
| (3,288) |
| (21,582) |
| (24,870) |
Total changes in ownership interests |
| — |
| — |
| — |
| (3,288) |
| — |
| — |
| — |
| — |
| — |
| — |
| (3,288) |
| (21,582) |
| (24,870) |
Total transactions with owners of the Company |
| 638,375 |
| 492,783 |
| — |
| (2,039,113) |
| — |
| — |
| (496,916) |
| — |
| — |
| — |
| (1,404,871) |
| 10,813,859 |
| 9,408,988 |
At March 31, 2021 |
| 6,365,853 |
| (91,158) |
| 737 |
| (2,979,197) |
| (263,319) |
| 42,593 |
| 5,837,511 |
| 171,021 |
| 348,044 |
| 638,807 |
| 10,070,892 |
| 11,568,460 |
| 21,639,352 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The accompanying notes are an integral part of these interim financial statements. |
|
|
|
|
|
| Capital reserve |
|
|
| Profit reserve |
|
|
|
|
|
|
|
| ||||||||
|
| Share capital |
| Treasury share |
| Corporate transactions - Law 6404 |
| Capital transactions |
| Accumulated other comprehensive loss |
| Legal |
| Statutory reserve |
| Profit to be realized |
| Retained earnings |
| Accumulated profits |
| Total |
| Non-controlling interest |
| Total equity |
At January 1, 2020 |
| 5,045,214 |
| (112,785) |
| 737 |
| (958,738) |
| (349,501) |
| 121,270 |
| 6,288,472 |
| 171,021 |
| 348,044 |
| — |
| 10,553,734 |
| 507,482 |
| 11,061,216 |
Profit for the period |
| — |
| — |
| — |
| — |
| — |
| — |
| — |
| — |
| — |
| 102,250 |
| 102,250 |
| 14,455 |
| 116,705 |
Other comprehensive income: (note 15) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss on cash flow hedge |
| — |
| — |
| — |
| — |
| (155,635) |
| — |
| — |
| — |
| — |
| — |
| (155,635) |
| — |
| (155,635) |
Foreign currency translation differences |
| — |
| — |
| — |
| — |
| 563,497 |
| — |
| — |
| — |
| — |
| — |
| 563,497 |
| 47,185 |
| 610,682 |
Change in fair value of financial assets |
| — |
| — |
| — |
| — |
| (1) |
| — |
| — |
| — |
| — |
| — |
| (1) |
| — |
| (1) |
Total comprehensive income for the period |
| — |
| — |
| — |
| — |
| 407,861 |
| — |
| — |
| — |
| — |
| 102,250 |
| 510,111 |
| 61,640 |
| 571,751 |
Transactions with owners of the Company |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Contributions and distributions: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital increase |
| — |
| — |
| — |
| — |
| — |
| — |
| — |
| — |
| — |
| — |
| — |
| 6,666 |
| 6,666 |
Share options exercised |
| — |
| 1,081 |
| (1,081) |
| — |
| — |
| — |
| — |
| — |
| — |
| — |
| — |
| — |
| — |
Dividends - non-controlling interests |
| — |
| — |
| — |
| — |
| — |
| — |
| — |
| — |
| — |
| — |
| — |
| (1,145) |
| (1,145) |
Treasury shares acquired |
| — |
| (290,772) |
| — |
| — |
| — |
| — |
| — |
| — |
| — |
| — |
| (290,772) |
| — |
| (290,772) |
Share-based payment transactions |
| — |
| — |
| — |
| 3,132 |
| — |
| — |
| — |
| — |
| — |
| — |
| 3,132 |
| 18 |
| 3,150 |
Total contributions by and distributions to owners of the Company |
| — |
| (289,691) |
| (1,081) |
| 3,132 |
| — |
| — |
| — |
| — |
| — |
| — |
| (287,640) |
| 5,539 |
| (282,101) |
Transactions with owners of the Company |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Change of shareholding interest in subsidiary |
| — |
| — |
| — |
| 44,569 |
| — |
| — |
| — |
| — |
| — |
| — |
| 44,569 |
| 30,431 |
| 75,000 |
Total changes in ownership interests |
| — |
| — |
| — |
| 44,569 |
| — |
| — |
| — |
| — |
| — |
| — |
| 44,569 |
| 30,431 |
| 75,000 |
Total transactions with owners of the Company |
| — |
| (289,691) |
| (1,081) |
| 47,701 |
| — |
| — |
| — |
| — |
| — |
| — |
| (243,071) |
| 35,970 |
| (207,101) |
At March 31, 2020 |
| 5,045,214 |
| (402,476) |
| (344) |
| (911,037) |
| 58,360 |
| 121,270 |
| 6,288,472 |
| 171,021 |
| 348,044 |
| 102,250 |
| 10,820,774 |
| 605,092 |
| 11,425,866 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The accompanying notes are an integral part of these interim financial statements. |
(In thousands of Brazilian Reais - R$)
|
|
| Parent Company |
| Consolidated | ||||
| Note |
| March 31, 2021 |
| March 31, 2020 |
| March 31, 2021 |
| March 31, 2020 |
Cash flows from operating activities |
|
|
|
|
|
|
|
|
|
Profit before taxes |
|
| 521,732 |
| (50,712) |
| 666,439 |
| 102,527 |
Adjustments for: |
|
|
|
|
|
|
|
|
|
Depreciation and amortization |
|
| 2,474 |
| 2,814 |
| 311,311 |
| 143,520 |
Interest in earnings of associates | 8.1 |
| (954,353) |
| (435,575) |
| 1,194 |
| (820) |
Interest in earnings of joint ventures | 9 |
| 54,936 |
| 24,159 |
| (254,801) |
| (191,344) |
(Gain) loss on disposals assets |
|
| — |
| — |
| (316) |
| 1,781 |
Share-based payment |
|
| 2,689 |
| 2,208 |
| 6,177 |
| 3,145 |
Legal proceedings provision |
|
| 24,013 |
| 7,288 |
| 35,459 |
| 6,945 |
Interest and exchange, net |
|
| 306,928 |
| 375,470 |
| 400,649 |
| 659,776 |
Sectorial financial assets and liabilities, net | 5.9 |
| — |
| — |
| 96,608 |
| — |
Provisions for employee benefits |
|
| 1,626 |
| (750) |
| 35,355 |
| 16,298 |
Allowance for expected credit losses |
|
| — |
| — |
| (1,079) |
| 7,686 |
Other |
|
| 26 |
| 66,339 |
| (37,995) |
| 45,728 |
|
|
| (39,929) |
| (8,759) |
| 1,259,001 |
| 795,242 |
Trade receivables |
|
| — |
| — |
| (45,005) |
| (32,984) |
Inventories |
|
| — |
| — |
| (6,828) |
| (30,050) |
Other current tax, net |
|
| (15,252) |
| (13,210) |
| 98,432 |
| (20,875) |
Income tax (i) |
|
| 12,349 |
| (22,247) |
| (97,078) |
| (402,541) |
Related parties, net |
|
| 6,063 |
| (221,814) |
| (16,146) |
| (7,506) |
Trade payables |
|
| (3,156) |
| (3,770) |
| (152,515) |
| 6,442 |
Employee benefits |
|
| (23,591) |
| (13,233) |
| (140,415) |
| (69,409) |
Provision for legal proceedings |
|
| (166) |
| (2,469) |
| (19,570) |
| (5,327) |
Other financial liabilities |
|
| — |
| — |
| (15,614) |
| (34,758) |
Judicial deposits |
|
| (633) |
| (1,130) |
| (10,472) |
| 27,983 |
Contractual obligations for assignment of credit rights |
|
| — |
| (132,200) |
| — |
| (132,200) |
Post-employment benefits |
|
| — |
| — |
| (7,861) |
| (10,903) |
Other assets and liabilities, net |
|
| (22,494) |
| (3,686) |
| (3,185) |
| (121,388) |
|
|
| (46,880) |
| (413,759) |
| (416,257) |
| (833,516) |
Net cash (used in) generated by operating activities |
|
| (86,809) |
| (422,518) |
| 842,744 |
| (38,274) |
Cash flows from investing activities |
|
|
|
|
|
|
|
|
|
Capital contribution in associates | 8.1 |
| (1,500) |
| (11,142) |
| — |
| (1,142) |
Acquisition of subsidiary, net of cash acquired |
|
| — |
| — |
| — |
| (90,247) |
(Purchase) sale of marketable securities |
|
| (52,254) |
| (158,652) |
| 1,574,984 |
| (449,198) |
Restricted cash |
|
| (30,012) |
| — |
| 24,405 |
| — |
Dividends received from associates |
|
| 198,020 |
| — |
| — |
| — |
Other financial assets |
|
| — |
| — |
| 8 |
| — |
Acquisition of property, plant and equipment, intangible assets and contract assets |
|
| (65) |
| (3,072) |
| (467,800) |
| (258,645) |
Cash in the merger operation | 1.2 |
| 353,601 |
| — |
| 8,125,855 |
| — |
Net cash generated by (used in) investing activities |
|
| 467,790 |
| (172,866) |
| 9,257,452 |
| (799,232) |
Cash flows from financing activities |
|
|
|
|
|
|
|
|
|
Loans, borrowings and debentures raised | 5.6 |
| — |
| — |
| 583,128 |
| 76,108 |
Repayment of principal on loans, borrowings and debentures | 5.6 |
| (5,427) |
| (1,700,000) |
| (6,945,855) |
| (1,950,907) |
Payment of interest on loans, borrowings and debentures | 5.6 |
| (134,759) |
| (35,203) |
| (513,490) |
| (199,603) |
Payment of derivative financial instruments |
|
| (25,383) |
| (36,078) |
| (505,080) |
| (13,727) |
Receipt of derivative financial instruments |
|
| 103,738 |
| 79,857 |
| 550,961 |
| 106,243 |
Payment of derivative financial instruments, except debt |
|
| (218,809) |
| — |
| (218,809) |
| — |
Receipt of derivative financial instruments, except debt |
|
| 197,679 |
| — |
| 197,679 |
| — |
Repayment of principal on leases | 5.8 |
| (305) |
| (167) |
| (27,769) |
| (2,358) |
Payment of interest on leases | 5.8 |
| (315) |
| (208) |
| (18,482) |
| (937) |
Equity contribution from shareholders interest |
|
| — |
| — |
| — |
| 75,000 |
Equity contribution from non-controlling interest | 8.2 |
| — |
| — |
| 1,750 |
| 6,666 |
Related parties |
|
| (185,547) |
| — |
| — |
| (17,063) |
Payments to redeem entity's shares |
|
| (4,778) |
| (290,772) |
| (34,529) |
| (290,772) |
Acquisition of non-controlling interests |
|
| (6,675) |
| — |
| — |
| — |
Dividends paid |
|
| — |
| — |
| (3,319) |
| (1,213) |
Receipts of consideration assets |
|
| — |
| — |
| — |
| 65,478 |
Net cash used in financing activities |
|
| (280,581) |
| (1,982,571) |
| (6,933,815) |
| (2,147,085) |
Increase (decrease) in cash and cash equivalents |
|
| 100,400 |
| (2,577,955) |
| 3,166,381 |
| (2,984,591) |
Cash and cash equivalents at beginning of the period |
|
| 1,149,267 |
| 3,490,707 |
| 4,614,053 |
| 6,076,644 |
Effect of exchange rate fluctuations on cash held |
|
| — |
| (249) |
| 152,736 |
| 247,390 |
Cash and cash equivalents at end of the period |
|
| 1,249,667 |
| 912,503 |
| 7,933,170 |
| 3,339,443 |
Additional information |
|
|
|
|
|
|
|
|
|
Income tax paid (i) |
|
| — |
| 3,767 |
| 37,560 |
| 380,279 |
The accompanying notes are an integral part of these interim financial statements.
(i) | In the three-month period ended March 31, 2021, the Company paid the annual adjustment of the Income Tax and Social Contribution of 2020 using tax credits, so that the amount presented as payment in the supplementary information refers only to monthly advances based on gross revenue. |
Statement of cash flows
(In thousands of Brazilian Reais - R$)
Non-cash transaction
- Recognition of interest on shareholder’s equity decided by Raízen Combustíveis S.A. in the amount of R$19,221.
- Acquisition of assets for construction of the natural gas distribution pipeline in the Comgás subsidiary with payment in installments in the amount of R$1,982.
- Capital contribution to the subsidiary Payly Soluções de Pagamentos S.A. in the amount of R$3,750, through the capitalization of reimbursable expenses.
- Registration of right-of-use against the lease liability in the amount of R$6,209 related to new contracts covered by the commercial lease rule.
- Acquisition of assets logistics operations with payment in installments in the amount of R$14,209 on March 31, 2021.
Disclosure of interest and dividends
The Company discloses the dividends and interest on shareholders' equity received as cash flow from investing activities, with the purpose of avoiding distortions in its cash flows from operation activities.
Interest received or paid is classified as cash flow in financing activities, as it is considered to be part of the costs of obtaining financial resources.
(In thousands of Brazilian Reais - R$)
|
| Parent Company | Consolidated | |||||
|
| March 31, 2021 |
| December 31, 2020 |
| March 31, 2021 |
| December 31, 2020 |
Revenues | ||||||||
Sales of products and services net of returns |
| — |
| — |
| 5,766,154 |
| 4,340,830 |
Other operating revenues (expenses), net |
| (1,291) |
| (69,299) |
| 7,526 |
| (26,697) |
Allowance for doubtful accounts |
| — |
| — |
| 931 |
| (7,686) |
|
| (1,291) |
| (69,299) |
| 5,774,611 |
| 4,306,447 |
Raw materials acquired from third parties |
|
|
|
|
|
|
|
|
Cost of goods sold and services rendered |
| — |
| — |
| (3,259,106) |
| (2,483,982) |
Materials, energy, third party services, others |
| (47,657) |
| (21,058) |
| (150,534) |
| (146,787) |
|
| (47,657) |
| (21,058) |
| (3,409,640) |
| (2,630,769) |
Gross value added |
| (48,948) |
| (90,357) |
| 2,364,971 |
| 1,675,678 |
Retention |
|
|
|
|
|
|
|
|
Depreciation and amortization |
| (2,474) |
| (2,814) |
| (311,311) |
| (143,520) |
|
| (2,474) |
| (2,814) |
| (311,311) |
| (143,520) |
Net value added |
| (51,422) |
| (93,171) |
| 2,053,660 |
| 1,532,158 |
Value added transferred in |
|
|
|
|
|
|
|
|
Interest in earnings of subsidiaries |
| 954,353 |
| 435,575 |
| (1,194) |
| 820 |
Interest in earnings of joint ventures |
| (54,936) |
| (24,159) |
| 254,801 |
| 191,344 |
Finance income |
| 36,325 |
| 60,779 |
| 191,152 |
| 265,649 |
|
| 935,742 |
| 472,195 |
| 444,759 |
| 457,813 |
Value added to be distributed |
| 884,320 |
| 379,024 |
| 2,498,419 |
| 1,989,971 |
Distribution of value added |
|
|
|
|
|
|
|
|
Payroll and social charges |
| 14,431 |
| 12,706 |
| 166,138 |
| 126,519 |
Direct remuneration |
| 12,217 |
| 11,248 |
| 148,297 |
| 109,120 |
Benefits |
| 1,552 |
| 1,353 |
| 17,192 |
| 16,504 |
FGTS and others |
| 662 |
| 105 |
| 649 |
| 895 |
Taxes and contributions |
| (112,690) |
| (150,791) |
| 1,051,816 |
| 857,902 |
Federal |
| (113,539) |
| (151,634) |
| 350,308 |
| 235,108 |
State |
| — |
| — |
| 679,281 |
| 607,582 |
Municipal |
| 849 |
| 843 |
| 22,227 |
| 15,212 |
Finance expense and rents |
| 343,772 |
| 414,859 |
| 572,202 |
| 888,845 |
Interest and exchange variation |
| 333,409 |
| 401,016 |
| 491,704 |
| 859,903 |
Rents |
| 2,140 |
| 1,422 |
| 3,334 |
| — |
Others |
| 8,223 |
| 12,421 |
| 77,164 |
| 28,942 |
Non-controlling interests |
| — |
| — |
| 69,456 |
| 14,455 |
Profit for the period |
| 638,807 |
| 102,250 |
| 638,807 |
| 102,250 |
|
| 884,320 |
| 379,024 |
| 2,498,419 |
| 1,989,971 |
The accompanying notes are an integral part of these interim financial statements. |
(In thousands of Brazilian Reais - R$, unless otherwise stated)
1 Operations
Cosan S.A. (“Cosan” or “the Company”) is a publicly traded Company with shares traded on the Novo Mercado of B3 S.A. - Brasil, Bolsa, Balcão, or “B3”, under the ticker symbol CSAN3, on the São Paulo Stock Exchange. New York, or "NYSE", under the ticker symbol CSAN and is headquartered in the city of São Paulo, Brazil. Mr. Rubens Ometto Silveira Mello is the ultimate controlling shareholder of Cosan.
Acquisition of Biosev S.A. by Raízen
On February 8, 2021, the jointly controlled subsidiary Raízen S.A. entered into an acquisition agreement with Biosev S.A., or "Biosev", and Hédera Investimentos e Participações S.A., or "Hédera", as the controlling shareholder of Biosev, among other parties, whereby Raízen agreed, under the terms and conditions established therein, to acquire up to 100% of the shares issued by Biosev.
The acquisition will involve an exchange of shares, with Raízen issuing preferred shares in the amount of 3.5% of its share capital and also paying an amount of R$3,600,000 in cash to refinance part of Hédera's debt. There will also be an issue of redeemable shares equivalent to 1.49% of Raízen's share capital for a symbolic amount. On March 1, 2021, the Brazilian Antitrust Authority (Conselho Administrativo de Defesa Econômica), or “CADE,” approved the transaction. The consummation of the acquisition is subject to compliance with certain conditions precedent established in the acquisition contract, there is no accounting impact in these financial statements. The expectation is that, after the acquisition, the shareholder structure of Raízen and Biosev will be as follows:
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
1.1 Covid-19
During the quarter ended March 31, 2021, the Company, its subsidiaries and jointly controlled companies continue to monitor the evolution of the COVID-19 pandemic in Brazil and worldwide, in order to take preventive measures to minimize the spread of the virus, ensure continuity of operations and safeguard the health and safety of our employees and partners. The response to the pandemic has been effective in limiting the impacts on our operational facilities, employees, supply chain and logistics.
The Company ended the period ended March 31, 2021 with cash of R$7,933,170, net working capital with a positive balance of R$9,157,835 and a net profit of R$708,263.
Our covenants are assessed monthly for our need to generate sufficient cash flows to meet indebtedness and our ability to meet the covenants contained in the contracts that govern our indebtedness. Until March 31, 2021, the Company and its subsidiaries have been complying with all restrictive financial clauses.
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
Considering the low level of interest rates in Brazil and in the locations of our subsidiaries, we consider that despite the short-term fluctuations in some macroeconomic assumptions due to the impacts of the COVID-19 pandemic, our weighted average cost of capital should not undergo material changes.
The Company assessed the circumstances that could indicate impairment of its non-financial assets and concluded that there were no changes in the circumstances that would indicate an impairment loss. Our tax recovery projections are based on the same scenarios and assumptions used in the impairment assessment.
Losses due to the non-recoverability of financial assets were calculated based on the credit risk analysis, which includes the history of losses, the individual situation of the customers, the situation of the economic group to which they belong, the real guarantees for debts and macroeconomic indicators and is considered on March 31, 2021, sufficient to cover possible losses on the amounts receivable, in addition to a prospective assessment that consider the change or expected change in economic factors that affect the expected credit losses, which will be determined based on weighted probabilities and measured at an amount equal to the expected credit loss for life.
The credit quality of accounts receivable falling due is considered adequate, and the amount of the effective risk of possible losses in accounts receivable from customers is presented as losses due to the non-recoverability of financial assets.
Our inventories are composed, substantially, of lubricants, base oil and materials for the construction of gas pipelines, which are products that are not valid or have a long duration and, therefore, we do not observe indicators of obsolescence or non-performance.
To date, there have been no changes in the scope of the Company's leases, including adding, terminating, extending, reducing the lease term. Also, there was no change in the consideration for the leases that we are both lessees and lessors.
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
1.2 Corporate reorganization
On July 2, 2020, the Boards of Directors of Cosan S.A., Cosan Limited and Cosan Logística S.A. (“Cosan Logística”), or collectively the “Companies”, authorized studies to be carried out on the proposed corporate reorganization to simplify the structure of the economic group.
As part of an effort to streamline its operations, Cosan S.A. carried out a Corporate Reorganization to improve the current corporate structure, making Cosan S.A. the only holding company of the Cosan Group (“Grupo Cosan” refers to the economic entity previously represented by Cosan Limited , Cosan S.A., Cosan Logística and its subsidiaries before the Merger, which, after the Merger, is represented by Cosan S.A. and its subsidiaries, as the context requires). The Operation aimed to simplify the corporate structure of the Cosan Group, unify and consolidate the outstanding shares in the financial market (“free floats”) of the Companies, increase the liquidity of their securities, as well as unlock the value that exists within the Cosan Group and facilitate future fundraising.
As part of the Transaction carried out, Cosan Limited and Cosan Logística were merged into Cosan S.A.. After the completion of the transaction, the outstanding shares of Cosan S.A. were directly held by all shareholders of Cosan Limited, Cosan S.A. and Cosan Logística. As part of the Mergers, Cosan S.A. issued American Depositary Shares (“ADSs”) listed on the New York Stock Exchange (New York Stock Exchange - NYSE) or Cosan S.A. shares listed on B3 S.A. - Brasil, Bolsa, Balcão (“B3”) for the shareholders of Cosan Limited. As for Cosan Logística, the shareholders of Cosan Logística became owners of shares of Cosan S.A.
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
Simplified operational structure after incorporations.
Respecting the Merger Protocols, subject to the terms and conditions described therein, and after the consummation of all transactions contemplated by them, Cosan Limited and Cosan Logística were merged, ceased to exist and their rights and obligations were transferred to Cosan S.A. as a Company successor.
The administrators of Cosan S.A., Cosan Limited and Cosan Logística evaluated the exchange ratio negotiated and recommended by the committees and stated as follows:
- The exchange ratio was 0.772788 shares issued by Cosan Limited for each share issued by Cosan S.A, or 1 American Depositary Receipts (“ADRs”) of the Company (each ADR representing a common share of the Company). Thus, as a result of the Merger and in view of the Exchange Ratio, 308,554,969 shares issued by Cosan S.A. were issued former Cosan Limited shareholders; and
- The exchange ratio was 3.943112 shares issued by Cosan Logística for each share issued by Cosan S.A. Thus, as a result of the Merger and in view of the Exchange Ratio, 31,025,350 shares issued by Cosan S.A. were issued to the former shareholders of Cosan Logística.
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
On January 22, 2021, the proposed corporate reorganization of the Companies, which consisted of the merger of companies under common control Cosan Limited and Cosan Logística, was approved at the respective extraordinary general meetings of the Companies.
After the approval of the Mergers at the respective Extraordinary Shareholders' Meetings (“AGE”) of the companies, Cosan Logística shareholders were able to exercise the right of withdrawal within 30 days after the AGEs, based on the Valuation Report at Cosan's Market Price Logistics, resulting in R$12.40 per share. On February 22, 2021, the term ended and no shareholder exercised his right of withdrawal.
Also considering the meeting of the Company's Board of Directors held on February 5, 2021, among other matters, the Board decided to cancel 10,000,000 shares issued by the Company that were held in treasury.
The merged and consolidated subsidiaries as of March 1, 2021, generated a profit of R$57,814 in the Company's net income for the month March 2021.
Basis of preparation of reviewed financial information
The balance sheets as of March 1, 2021 are based on the individual and consolidated historical balances of Cosan S.A., Cosan Limited and Cosan Logística, as shown below:
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
Parent company
Open Balance (01/03/2021)
|
|
|
|
| Incorporated companies |
|
|
|
|
|
| ||||
|
|
| Consolidated Cosan S.A. |
| Corporate Cosan Limited |
| Consolidated Cosan Logística |
| Total incorporated assets |
| Elimination |
| Adjustments |
| Cosan S.A. post-reorganization |
Assets |
|
|
|
|
|
|
|
|
|
| 1.2.(a) |
| 1.2.(b) |
|
|
Cash and cash equivalents |
|
| 1,099,643 |
| 353,595 |
| 6 |
| 353,601 |
| — |
| — |
| 1,453,244 |
Marketable securities |
|
| 927,011 |
| — |
| — |
| — |
| — |
| — |
| 927,011 |
Derivative financial instruments |
|
| 71,133 |
| — |
| — |
| — |
| — |
| — |
| 71,133 |
Receivables from related parties |
|
| 279,718 |
| 54 |
| 194 |
| 248 |
| (12,481) |
| — |
| 267,485 |
Income tax receivable |
|
| 143,359 |
| 3 |
| 2,841 |
| 2,844 |
| — |
| — |
| 146,203 |
Other current tax receivable |
|
| 35,515 |
| — |
| 4 |
| 4 |
| — |
| — |
| 35,519 |
Dividends receivable |
|
| 160,694 |
| 148,271 |
| — |
| 148,271 |
| (148,271) |
| — |
| 160,694 |
Other financial assets |
|
| 734,903 |
| — |
| — |
| — |
| — |
| (734,903) |
| — |
Other current assets |
|
| 101,221 |
| 1,744 |
| — |
| 1,744 |
| — |
| — |
| 102,965 |
Total current assets |
|
| 3,553,197 |
| 503,667 |
| 3,045 |
| 506,712 |
| (160,752) |
| (734,903) |
| 3,164,254 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Deferred tax assets |
|
| 75,959 |
| — |
| — |
| — |
| — |
| 80,483 |
| 156,442 |
Receivables from related parties |
|
| 576,929 |
| — |
| — |
| — |
| — |
| — |
| 576,929 |
Other non-current tax receivable |
|
| 37,623 |
| — |
| — |
| — |
| — |
| — |
| 37,623 |
Judicial deposits |
|
| 384,455 |
| — |
| 1,017 |
| 1,017 |
| — |
| — |
| 385,472 |
Derivative financial instruments |
|
| 2,758,732 |
| 183,426 |
| — |
| 183,426 |
| — |
| — |
| 2,942,158 |
Other non-current assets |
|
| 169,370 |
| — |
| — |
| — |
| — |
| — |
| 169,370 |
Investments in associates |
|
| 13,025,364 |
| 8,769,145 |
| 4,259,390 |
| 13,028,535 |
| (8,761,919) |
| 329,118 |
| 17,621,098 |
Property, plant and equipment |
|
| 60,457 |
| 2,724 |
| — |
| 2,724 |
| — |
| — |
| 63,181 |
Intangible assets and goodwill |
|
| 2,067 |
| — |
| — |
| — |
| — |
| — |
| 2,067 |
Right-of-use assets |
|
| 24,212 |
| 8,430 |
| — |
| 8,430 |
| — |
| — |
| 32,642 |
Total non-current assets |
|
| 17,115,168 |
| 8,963,725 |
| 4,260,407 |
| 13,224,132 |
| (8,761,919) |
| 409,601 |
| 21,986,982 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets |
|
| 20,668,365 |
| 9,467,392 |
| 4,263,452 |
| 13,730,844 |
| (8,922,671) |
| (325,302) |
| 25,151,236 |
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
|
|
|
|
| Incorporated companies |
|
|
|
|
|
| ||||
|
|
| Consolidated Cosan S.A. |
| Corporate Cosan Limited |
| Consolidated Cosan Logística |
| Total incorporated assets |
| Elimination |
| Adjustments |
| Cosan S.A. post-reorganization |
Liabilities |
|
|
|
|
|
|
|
|
|
| 1.2.(a) |
| 1.2.(b) |
|
|
Loans, borrowings and debentures |
|
| — |
| 98,397 |
| 38,981 |
| 137,378 |
| — |
| — |
| 137,378 |
Leases |
|
| 2,785 |
| 824 |
| — |
| 824 |
| — |
| — |
| 3,609 |
Derivative financial instruments |
|
| 1,253 |
| — |
| — |
| — |
| — |
| — |
| 1,253 |
Trade payables |
|
| 1,769 |
| 207 |
| 40 |
| 247 |
| — |
| — |
| 2,016 |
Employee benefits payables |
|
| 24,246 |
| — |
| — |
| — |
| — |
| — |
| 24,246 |
Income tax payables |
|
| 614 |
| 3 |
| 5 |
| 8 |
| — |
| — |
| 622 |
Other taxes payable |
|
| 115,593 |
| 9 |
| 1,251 |
| 1,260 |
| — |
| (11,544) |
| 105,309 |
Dividends payable |
|
| 216,929 |
| — |
| 241 |
| 241 |
| (148,271) |
| — |
| 68,899 |
Payables to related parties |
|
| 318,535 |
| 4,844 |
| 407 |
| 5,251 |
| (12,483) |
| — |
| 311,303 |
Other current liabilities |
|
| 107,502 |
| 7,902 |
| 992 |
| 8,894 |
| — |
| — |
| 116,396 |
Total current liabilities |
|
| 789,226 |
| 112,186 |
| 41,917 |
| 154,103 |
| (160,754) |
| (11,544) |
| 771,031 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans, borrowings and debentures |
|
| — |
| 4,124,973 |
| 1,719,992 |
| 5,844,965 |
| — |
| — |
| 5,844,965 |
Leases |
|
| 24,930 |
| 8,887 |
| — |
| 8,887 |
| — |
| — |
| 33,817 |
Preferred shareholders payable in subsidiaries |
|
| 389,585 |
| — |
| — |
| — |
| — |
| — |
| 389,585 |
Derivative financial instruments |
|
| 110,554 |
| — |
| — |
| — |
| — |
| — |
| 110,554 |
Other taxes payable |
|
| 140,978 |
| — |
| — |
| — |
| — |
| — |
| 140,978 |
Provision for legal proceedings |
|
| 309,484 |
| — |
| — |
| — |
| — |
| — |
| 309,484 |
Provision for uncovered liability of associates |
|
| 432,350 |
| — |
| — |
| — |
| — |
| — |
| 432,350 |
Payables to related parties |
|
| 7,499,128 |
| 47,771 |
| — |
| 47,771 |
| — |
| — |
| 7,546,899 |
Post-employment benefits |
|
| 155 |
| — |
| — |
| — |
| — |
| — |
| 155 |
Other non-current liabilities |
|
| 288,658 |
| — |
| — |
| — |
| — |
| — |
| 288,658 |
Total non-current liabilities |
|
| 9,195,822 |
| 4,181,631 |
| 1,719,992 |
| 5,901,623 |
| — |
| — |
| 15,097,445 |
Total liabilities |
|
| 9,985,048 |
| 4,293,817 |
| 1,761,909 |
| 6,055,726 |
| (160,754) |
| (11,544) |
| 15,868,476 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders' equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share capital |
|
| 5,727,478 |
| 5,328 |
| 2,284,893 |
| 2,290,221 |
| (1,651,846) |
| — |
| 6,365,853 |
Reserves and other components of equity |
|
| 4,955,839 |
| 5,168,247 |
| 216,650 |
| 5,384,897 |
| (7,110,071) |
| (313,758) |
| 2,916,907 |
|
|
| 10,683,317 |
| 5,173,575 |
| 2,501,543 |
| 7,675,118 |
| (8,761,917) |
| (313,758) |
| 9,282,760 |
Equity attributable to: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Owners of the Company |
|
| 10,683,317 |
| 5,173,575 |
| 2,501,543 |
| 7,675,118 |
| (8,761,917) |
| (313,758) |
| 9,282,760 |
Total shareholders' equity |
|
| 10,683,317 |
| 5,173,575 |
| 2,501,543 |
| 7,675,118 |
| (8,761,917) |
| (313,758) |
| 9,282,760 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total shareholders' equity and liabilities |
|
| 20,668,365 |
| 9,467,392 |
| 4,263,452 |
| 13,730,844 |
| (8,922,671) |
| (325,302) |
| 25,151,236 |
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
Consolidated
Open Balance (01/03/2021)
|
|
|
|
| Incorporated companies |
|
|
|
|
|
| ||||
|
|
| Consolidated Cosan S.A. |
| Corporate Cosan Limited |
| Consolidated Cosan Logística |
| Total incorporated assets |
| Elimination |
| Adjustments |
| Cosan S.A. post-reorganization |
Assets |
|
|
|
|
|
|
|
|
|
| 1.2.(a) |
| 1.2.(b) |
|
|
Cash and cash equivalents |
|
| 4,367,675 |
| 356,410 |
| 7,769,445 |
| 8,125,855 |
| — |
| — |
| 12,493,530 |
Marketable securities |
|
| 1,686,029 |
| 327 |
| 3,025,185 |
| 3,025,512 |
| — |
| — |
| 4,711,541 |
Trade receivables |
|
| 1,639,123 |
| 305 |
| 617,546 |
| 617,851 |
| — |
| — |
| 2,256,974 |
Derivative financial instruments |
|
| 182,922 |
| — |
| 82,191 |
| 82,191 |
| — |
| — |
| 265,113 |
Inventories |
|
| 659,485 |
| 8 |
| 255,042 |
| 255,050 |
| — |
| — |
| 914,535 |
Receivables from related parties |
|
| 205,383 |
| 36 |
| 36,451 |
| 36,487 |
| (12,481) |
| — |
| 229,389 |
Income tax receivable |
|
| 169,644 |
| 7 |
| 98,343 |
| 98,350 |
| — |
| — |
| 267,994 |
Other current tax receivable |
|
| 372,525 |
| 172 |
| 345,539 |
| 345,711 |
| — |
| — |
| 718,236 |
Dividends receivable |
|
| 77,561 |
| 148,271 |
| 6,322 |
| 154,593 |
| (148,271) |
| — |
| 83,883 |
Sectorial financial assets |
|
| 216,488 |
| — |
| — |
| — |
| — |
| — |
| 216,488 |
Other financial assets |
|
| 804,256 |
| — |
| — |
| — |
| — |
| (734,903) |
| 69,353 |
Other current assets |
|
| 294,606 |
| 1,955 |
| 264,994 |
| 266,949 |
| — |
| — |
| 561,555 |
Total current assets |
|
| 10,675,697 |
| 507,491 |
| 12,501,058 |
| 13,008,549 |
| (160,752) |
| (734,903) |
| 22,788,591 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Trade receivables |
|
| 19,476 |
| — |
| 6,303 |
| 6,303 |
| — |
| — |
| 25,779 |
Restricted cash |
|
| — |
| — |
| 29,835 |
| 29,835 |
| — |
| — |
| 29,835 |
Deferred tax assets |
|
| 631,987 |
| 33 |
| 1,350,121 |
| 1,350,154 |
| — |
| — |
| 1,982,141 |
Receivables from related parties |
|
| 207,905 |
| — |
| 94,473 |
| 94,473 |
| (47,770) |
| — |
| 254,608 |
Income taxes receivable |
|
| 309 |
| — |
| 40,707 |
| 40,707 |
| — |
| — |
| 41,016 |
Other non-current tax receivable |
|
| 168,666 |
| — |
| 782,580 |
| 782,580 |
| — |
| — |
| 951,246 |
Judicial deposits |
|
| 551,833 |
| — |
| 328,984 |
| 328,984 |
| — |
| — |
| 880,817 |
Derivative financial instruments |
|
| 3,311,933 |
| 183,426 |
| 2,346,374 |
| 2,529,800 |
| — |
| — |
| 5,841,733 |
Contract asset |
|
| 655,680 |
| — |
| — |
| — |
| — |
| — |
| 655,680 |
Other non-current assets |
|
| 235,161 |
| 2 |
| 57,726 |
| 57,728 |
| — |
| — |
| 292,889 |
Investments in associates |
|
| 331,005 |
| 8,758,462 |
| 49,953 |
| 8,808,415 |
| (9,087,580) |
| 329,118 |
| 380,958 |
Investments in joint ventures |
|
| 7,613,457 |
| — |
| — |
| — |
| — |
| — |
| 7,613,457 |
Property, plant and equipment |
|
| 424,651 |
| 4,335 |
| 14,032,909 |
| 14,037,244 |
| — |
| — |
| 14,461,895 |
Intangible assets and goodwill |
|
| 10,184,202 |
| 15,159 |
| 7,226,616 |
| 7,241,775 |
| — |
| — |
| 17,425,977 |
Right-of-use assets |
|
| 83,664 |
| 8,853 |
| 7,809,397 |
| 7,818,250 |
| — |
| — |
| 7,901,914 |
Total non-current assets |
|
| 24,419,929 |
| 8,970,270 |
| 34,155,978 |
| 43,126,248 |
| (9,135,350) |
| 329,118 |
| 58,739,945 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets |
|
| 35,095,626 |
| 9,477,761 |
| 46,657,036 |
| 56,134,797 |
| (9,296,102) |
| (405,785) |
| 81,528,536 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
|
|
|
|
| Incorporated companies |
|
|
|
|
|
| ||||
|
|
| Consolidated Cosan S.A. |
| Corporate Cosan Limited |
| Consolidated Cosan Logística |
| Total incorporated assets |
| Elimination |
| Adjustments |
| Cosan S.A. post-reorganization |
Liabilities |
|
|
|
|
|
|
|
|
|
| 1.2.(a) |
| 1.2.(b) |
|
|
Loans, borrowings and debentures |
|
| 842,781 |
| 98,420 |
| 2,318,462 |
| 2,416,882 |
| — |
| — |
| 3,259,663 |
Leases |
|
| 11,867 |
| 1,068 |
| 510,047 |
| 511,115 |
| — |
| — |
| 522,982 |
Derivative financial instruments |
|
| 146,261 |
| — |
| — |
| — |
| — |
| — |
| 146,261 |
Trade payables |
|
| 1,813,517 |
| 1,335 |
| 566,273 |
| 567,608 |
| — |
| — |
| 2,381,125 |
Employee benefits payables |
|
| 214,941 |
| 1,782 |
| 154,262 |
| 156,044 |
| — |
| — |
| 370,985 |
Income tax payables |
|
| 331,264 |
| 580 |
| 245,826 |
| 246,406 |
| — |
| — |
| 577,670 |
Other taxes payable |
|
| 375,996 |
| 10 |
| 33,092 |
| 33,102 |
| — |
| (11,544) |
| 397,554 |
Dividends payable |
|
| 285,209 |
| — |
| 10,267 |
| 10,267 |
| (148,271) |
| — |
| 147,205 |
Concessions payable |
|
| — |
| — |
| 159,330 |
| 159,330 |
| — |
| — |
| 159,330 |
Payables to related parties |
|
| 304,021 |
| 5,786 |
| 188,971 |
| 194,757 |
| (12,483) |
| — |
| 486,295 |
Sectorial financial liabilities |
|
| 93,244 |
| — |
| — |
| — |
| — |
| — |
| 93,244 |
Other financial liabilities |
|
| 120,247 |
| — |
| 361,494 |
| 361,494 |
| — |
| — |
| 481,741 |
Other current liabilities |
|
| 229,603 |
| 9,289 |
| 298,692 |
| 307,981 |
| — |
| — |
| 537,584 |
Total current liabilities |
|
| 4,768,951 |
| 118,270 |
| 4,846,716 |
| 4,964,986 |
| (160,754) |
| (11,544) |
| 9,561,639 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans, borrowings and debentures |
|
| 14,091,982 |
| 4,125,001 |
| 20,275,636 |
| 24,400,637 |
| — |
| — |
| 38,492,619 |
Leases |
|
| 67,882 |
| 9,097 |
| 2,430,749 |
| 2,439,846 |
| — |
| — |
| 2,507,728 |
Preferred shareholders payable in subsidiaries |
|
| 389,585 |
| — |
| — |
| — |
| — |
| — |
| 389,585 |
Derivative financial instruments |
|
| 110,554 |
| — |
| — |
| — |
| — |
| — |
| 110,554 |
Other taxes payable |
|
| 146,539 |
| — |
| 2,112 |
| 2,112 |
| — |
| — |
| 148,651 |
Provision for legal proceedings |
|
| 890,189 |
| — |
| 497,574 |
| 497,574 |
| — |
| — |
| 1,387,763 |
Concessions payable |
|
| — |
| — |
| 2,849,861 |
| 2,849,861 |
| — |
| — |
| 2,849,861 |
Payables to related parties |
|
| — |
| 47,771 |
| — |
| 47,771 |
| (47,771) |
| — |
| — |
Post-employment benefits |
|
| 733,047 |
| — |
| 57 |
| 57 |
| — |
| — |
| 733,104 |
Deferred tax liabilities |
|
| 1,326,171 |
| — |
| 1,988,261 |
| 1,988,261 |
| — |
| (80,483) |
| 3,233,949 |
Sectorial financial liabilities |
|
| 499,016 |
| — |
| — |
| — |
| — |
| — |
| 499,016 |
Deferred revenue |
|
| — |
| — |
| 42,100 |
| 42,100 |
| — |
| — |
| 42,100 |
Other non-current liabilities |
|
| 694,781 |
| — |
| 64,680 |
| 64,680 |
| — |
| — |
| 759,461 |
Total non-current liabilities |
|
| 18,949,746 |
| 4,181,869 |
| 28,151,030 |
| 32,332,899 |
| (47,771) |
| (80,483) |
| 51,154,391 |
Total liabilities |
|
| 23,718,697 |
| 4,300,139 |
| 32,997,746 |
| 37,297,885 |
| (208,525) |
| (92,027) |
| 60,716,030 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Shareholders' equity |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share capital |
|
| 5,727,478 |
| 5,328 |
| 2,284,893 |
| 2,290,221 |
| (1,651,846) |
| — |
| 6,365,853 |
Reserves and other components of equity |
|
| 4,955,839 |
| 5,168,247 |
| 216,650 |
| 5,384,897 |
| (7,110,071) |
| (313,758) |
| 2,916,907 |
|
|
| 10,683,317 |
| 5,173,575 |
| 2,501,543 |
| 7,675,118 |
| (8,761,917) |
| (313,758) |
| 9,282,760 |
Equity attributable to: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Owners of the Company |
|
| 10,683,317 |
| 5,173,575 |
| 2,501,543 |
| 7,675,118 |
| (8,761,917) |
| (313,758) |
| 9,282,760 |
Non-controlling interests |
|
| 693,612 |
| 4,047 |
| 11,157,747 |
| 11,161,794 |
| (325,660) |
| — |
| 11,529,746 |
Total shareholders' equity |
|
| 11,376,929 |
| 5,177,622 |
| 13,659,290 |
| 18,836,912 |
| (9,087,577) |
| (313,758) |
| 20,812,506 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total shareholders' equity and liabilities |
|
| 35,095,626 |
| 9,477,761 |
| 46,657,036 |
| 56,134,797 |
| (9,296,102) |
| (405,785) |
| 81,528,536 |
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
Adjustments and assumptions used
The financial information was prepared and presented based on the individual and consolidated balances and the adjustments were determined following Management's assumptions and best estimates that include the following adjustments:
1.2.(a) Elimination
The consummate operation was an intra-group reorganization, in which: (1) it involved only entities that are under common control; and (2) all the entities involved were already presented at Cosan Limited on a consolidated basis. As a result, the investment balances that Cosan Limited held in Cosan logistics and Cosan S.A. were eliminated, as well as the effects of transactions between related parties.
1.2.(b) Adjustment of other financial assets
Cosan S.A. owned 40,065,607 shares of Rumo S.A., representing 2.16% of its shareholders 'equity, and 477,196 shares of Cosan Logística, representing 0.10% of its shareholders' equity. These shares were recorded in the balance sheet as a financial asset, being measured at fair value through profit or loss, as Management considered trading these shares.
With the corporate reorganization, the financial asset, as well as its applicable taxes, was derecognized for R$734,903 and, consequently, an investment in subsidiary of R$329,118 was recorded. Additionally, the amount of R$313,758 was recognized in equity.
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
2 Statement of compliance
These individual and consolidated interim financial statements have been prepared and are being presented in accordance with technical pronouncement CPC 21 (R1) - Interim Financial Statements and with international standards IAS 34 - Interim Financial Reporting, issued by the International Accounting Standards Board (IASB), and also based on the provisions contained in the Brazilian Corporation Law, and presented in a manner consistent with the rules issued by the Brazilian Securities and Exchange Commission, applicable to the preparation of quarterly information - ITR.
The presentation of the Statements of Value Added (DVA), individual and consolidated, is required by Brazilian corporate law and the accounting practices adopted in Brazil applicable to publicly-held companies CPC 09 - Statement of Added Value. IFRS standards do not require the presentation of this statement. As a consequence, under IFRS, this statement is presented as supplementary information, without prejudice to the set of interim financial statements.
Except for information from the merged companies, these interim financial statements were prepared following the basis of preparation and accounting policies consistent with those adopted in the preparation of the financial statements of December 31, 2020 and should be read together.
The information in the explanatory notes that have not undergone any significant changes compared to December 31, 2020 has not been fully presented in this quarterly information.
The relevant information proper to the interim financial statements, and only them, are being disclosed and that correspond to those used by Management in its management.
These interim financial statements were authorized for issue by Management on May 14, 2021.
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
3 Accounting policies
These interim financial statements were prepared following the basis of preparation and accounting policies consistent with those adopted in the preparation of the financial statements of December 31, 2020, except for the statements described in the respective notes from the companies incorporated in the corporate reorganization, as per note 1.2. All balances have been rounded to the nearest thousand, except where otherwise indicated.
4 Segment information
The following segment information is used by Company’s senior management (the “Chief Operating Decision Maker”) to assess the performance of the operating segments and to make decisions with regards to the allocation of resources. This information is prepared on a basis consistent with the accounting policies used in the preparation of the financial statements. The Company evaluates the performance of its operating segments based on the measure of Earnings Before Interest Taxes, Depreciation and Amortization (“EBITDA”).
Reported segments:
- Raízen Energia: production and marketing of a variety of products derived from sugar cane, including raw sugar (Very High Polarization, or “VHP”), and renewable products, such as anhydrous and hydrated ethanol, second generation ethanol and activities related to energy cogeneration from sugarcane bagasse, among other. In addition, this segment holds interests in companies engaged in research and development on new technology;
- Raízen Combustíveis: distribution and marketing of fuels, mainly through a franchised network of service stations under the “Shell” brand throughout Brazil, petroleum refining, the operation of fuel resellers, a convenience store business, the manufacture and sale of automotive and industrial lubricants, and the production and sale of liquefied petroleum gas throughout Argentina;
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
- Gas and Energy: its main activities are: (i) distribution of piped natural gas in part of the State of São Paulo to customers in the industrial, residential, commercial, automotive and cogeneration sectors; and (ii) the sale of electricity, comprising the purchase and sale of electricity to other traders, to consumers who have a free choice of supplier and to other agents permitted by law, other investments in the development process and corporate activities, including TRSP - LNG Regasification Terminal of São Paulo S.A. (“TRSP”), Rota 4 Participações S.A. (“Rota 4”) and Edge II - Empresa de Geração de Energia S.A..
- Moove: production and distribution of lubricants under the Mobil brand in Brazil, Argentina, Bolivia, Uruguay, Paraguay, the United States of America and Europe, as well as in the European and Asian markets under the “Comma” trademark and corporate activities;
- Logistics: logistics services for rail transportation, storage and port loading of commodities, mainly for grains and sugar, leasing of locomotives, wagons and another railroad equipment; and
Reconciliation:
- Cosan Corporate: digital wallet platform and other investments, in addition to the corporate activities of the Company. The Cosan corporate segment includes the financing subsidiaries for the Cosan group.
Although, Raízen Energia S.A. (“Raízen Energia”) and Raízen Combustíveis are equity accounted joint ventures and are no longer proportionally consolidated, senior management continues to review segment information. A reconciliation of these segments is presented in the column “Deconsolidated effects.”
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
| March 31, 2021 | ||||||||||||||||||
| Reported segments |
| Reconciliation |
| Consolidated | ||||||||||||||
| Raízen Energia |
| Raízen Combustíveis |
| Gas and Energy |
| Moove |
| Logistics (ii) |
| Cosan Corporate |
| Deconsolidated effects |
| Segment elimination |
| |||
|
| Brazil |
| Argentina |
|
|
|
|
|
|
| ||||||||
Statement of profit or loss: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross sales | 9,909,774 |
| 23,919,738 |
| 5,243,764 |
| 3,207,371 |
| 1,783,529 |
| 828,461 |
| 377 |
| (39,073,276) |
| (4,083) |
| 5,815,655 |
Domestic market (i) | 5,050,364 |
| 23,919,738 |
| 5,243,764 |
| 3,207,371 |
| 1,627,996 |
| 828,461 |
| 377 |
| (34,213,866) |
| (4,083) |
| 5,660,122 |
External market (i) | 4,859,410 |
| — |
| — |
| — |
| 155,533 |
| — |
| — |
| (4,859,410) |
| — |
| 155,533 |
Net sales | 9,424,596 |
| 22,945,322 |
| 3,541,760 |
| 2,516,622 |
| 1,417,556 |
| 785,351 |
| 353 |
| (35,911,678) |
| (4,083) |
| 4,715,799 |
Cost of sales | (8,655,960) |
| (21,935,380) |
| (3,027,334) |
| (1,817,781) |
| (1,083,803) |
| (471,989) |
| (377) |
| 33,618,674 |
| 4,083 |
| (3,369,867) |
Gross profit | 768,636 |
| 1,009,942 |
| 514,426 |
| 698,841 |
| 333,753 |
| 313,362 |
| (24) |
| (2,293,004) |
| — |
| 1,345,932 |
Selling expenses | (262,598) |
| (344,589) |
| (247,121) |
| (26,173) |
| (128,739) |
| (3,052) |
| (691) |
| 854,308 |
| — |
| (158,655) |
General and administrative expenses | (165,706) |
| (137,025) |
| (56,139) |
| (225,586) |
| (56,036) |
| (31,412) |
| (50,574) |
| 358,870 |
| — |
| (363,608) |
Other income (expenses), net | 113,048 |
| 61,219 |
| 32,677 |
| (6,167) |
| 12,928 |
| (10,782) |
| (24,905) |
| (206,944) |
| — |
| (28,926) |
Interest in earnings of associates | — |
| 91,527 |
| — |
| — |
| — |
| 130 |
| 524,629 |
| (91,527) |
| (525,953) |
| (1,194) |
Interest in earnings of joint ventures | 10,382 |
| (8,393) |
| — |
| — |
| — |
| — |
| 254,801 |
| (1,989) |
| — |
| 254,801 |
Finance results, net | (240,798) |
| (201,154) |
| (99,329) |
| (59,806) |
| (51,423) |
| (175,677) |
| (95,005) |
| 541,281 |
| — |
| (381,911) |
Finance expense | (78,574) |
| 57,448 |
| (18,135) |
| (145,108) |
| (7,612) |
| (444) |
| (18,653) |
| 39,261 |
| — |
| (171,817) |
Finance income | 81,136 |
| 52,822 |
| 39,601 |
| 149,922 |
| 2,836 |
| 19,474 |
| 18,919 |
| (173,559) |
| — |
| 191,151 |
Foreign exchange, net | (234,400) |
| (811,895) |
| (82,553) |
| (83,347) |
| (58,589) |
| (164,859) |
| (684,664) |
| 1,128,848 |
| — |
| (991,459) |
Derivatives | (8,960) |
| 500,471 |
| (38,242) |
| 18,727 |
| 11,942 |
| (29,848) |
| 589,393 |
| (453,269) |
| — |
| 590,214 |
Income tax (expense)benefit | (46,216) |
| (125,978) |
| (52,987) |
| 90,030 |
| (43,557) |
| (34,755) |
| 30,106 |
| 225,181 |
| — |
| 41,824 |
Profit (loss) for the period | 176,748 |
| 345,549 |
| 91,527 |
| 471,139 |
| 66,926 |
| 57,814 |
| 638,337 |
| (613,824) |
| (525,953) |
| 708,263 |
Profit (loss) attributable to: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Owners of the Company | 181,822 |
| 331,233 |
| 91,527 |
| 462,399 |
| 46,487 |
| 17,067 |
| 638,807 |
| (604,582) |
| (525,953) |
| 638,807 |
Non-controlling interests | (5,074) |
| 14,316 |
| — |
| 8,740 |
| 20,439 |
| 40,747 |
| (470) |
| (9,242) |
| — |
| 69,456 |
| 176,748 |
| 345,549 |
| 91,527 |
| 471,139 |
| 66,926 |
| 57,814 |
| 638,337 |
| (613,824) |
| (525,953) |
| 708,263 |
Other select data |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization | 1,083,642 |
| 82,247 |
| 164,221 |
| 137,040 |
| 26,049 |
| 145,248 |
| 2,972 |
| (1,330,110) |
| 2 |
| 311,311 |
EBITDA | 1,547,404 |
| 754,928 |
| 408,064 |
| 577,955 |
| 187,955 |
| 413,494 |
| 706,208 |
| (2,710,396) |
| (525,951) |
| 1,359,661 |
Additions to PP&E, intangible and contract assets | 1,257,312 |
| 54,332 |
| 147,579 |
| 231,244 |
| 6,579 |
| 229,235 |
| 742 |
| (1,459,223) |
| — |
| 467,800 |
Reconciliation of EBITDA |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit (loss) for the period | 176,748 |
| 345,549 |
| 91,527 |
| 471,139 |
| 66,926 |
| 57,814 |
| 638,337 |
| (613,824) |
| (525,953) |
| 708,263 |
Income tax and (expense) benefit | 46,216 |
| 125,978 |
| 52,987 |
| (90,030) |
| 43,557 |
| 34,755 |
| (30,106) |
| (225,181) |
| — |
| (41,824) |
Finance results, net | 240,798 |
| 201,154 |
| 99,329 |
| 59,806 |
| 51,423 |
| 175,677 |
| 95,005 |
| (541,281) |
| — |
| 381,911 |
Depreciation and amortization | 1,083,642 |
| 82,247 |
| 164,221 |
| 137,040 |
| 26,049 |
| 145,248 |
| 2,972 |
| (1,330,110) |
| 2 |
| 311,311 |
EBITDA | 1,547,404 |
| 754,928 |
| 408,064 |
| 577,955 |
| 187,955 |
| 413,494 |
| 706,208 |
| (2,710,396) |
| (525,951) |
| 1,359,661 |
(i) Domestic markets: sales within the countries where each entity is located; external markets: sales export.
(ii) The results of the Logistics segment were consolidated as of March 1, 2021 as a result of the corporate reorganization, as detailed in Note 1.2.
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
| March 31, 2020 | ||||||||||||||||
| Reported segments |
| Reconciliation |
| Consolidated | ||||||||||||
| Raízen Energia |
| Raízen Combustíveis |
| Gas and Energy |
| Moove |
| Cosan Corporate |
| Deconsolidated effects |
| Segment elimination |
| |||
|
| Brazil |
| Argentina |
|
|
|
|
|
| |||||||
Statement of profit or loss: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross sales | 9,455,018 |
| 21,610,931 |
| 4,187,768 |
| 3,098,875 |
| 1,313,842 |
| — |
| (35,253,717) |
| — |
| 4,412,717 |
Domestic market (i) | 4,910,943 |
| 21,610,931 |
| 4,187,768 |
| 3,098,875 |
| 1,260,713 |
| — |
| (30,709,642) |
| — |
| 4,359,588 |
External market (i) | 4,544,075 |
| — |
| — |
| — |
| 53,129 |
| — |
| (4,544,075) |
| — |
| 53,129 |
Net sales | 8,995,333 |
| 20,537,673 |
| 2,986,452 |
| 2,475,345 |
| 1,031,167 |
| — |
| (32,519,458) |
| — |
| 3,506,512 |
Cost of sales | (8,179,782) |
| (19,744,529) |
| (2,732,934) |
| (1,680,462) |
| (804,738) |
| (1,177) |
| 30,657,245 |
| — |
| (2,486,377) |
Gross profit | 815,551 |
| 793,144 |
| 253,518 |
| 794,883 |
| 226,429 |
| (1,177) |
| (1,862,213) |
| — |
| 1,020,135 |
Selling expenses | (209,245) |
| (368,841) |
| (190,759) |
| (158,828) |
| (119,623) |
| (945) |
| 768,845 |
| — |
| (279,396) |
General and administrative expenses | (144,462) |
| (127,058) |
| (37,248) |
| (85,668) |
| (46,670) |
| (38,887) |
| 308,768 |
| — |
| (171,225) |
Other income (expenses), net | 269,821 |
| 113,046 |
| 24,485 |
| 10,688 |
| 28,341 |
| (74,983) |
| (407,352) |
| — |
| (35,954) |
Interest in earnings of associates | — |
| (13,310) |
| — |
| 4 |
| — |
| 398,298 |
| 13,310 |
| (397,482) |
| 820 |
Interest in earnings of joint ventures | (4,338) |
| 449 |
| — |
| — |
| — |
| 191,344 |
| 3,889 |
| — |
| 191,344 |
Finance results, net | (336,010) |
| (165,145) |
| (51,673) |
| (595) |
| (39,040) |
| (583,562) |
| 552,828 |
| — |
| (623,197) |
Finance expense | (228,080) |
| (278,501) |
| (23,775) |
| (89,481) |
| (8,112) |
| (650,427) |
| 530,356 |
| — |
| (748,020) |
Finance income | 97,332 |
| 75,158 |
| 7,491 |
| 206,133 |
| 9,987 |
| 49,529 |
| (179,981) |
| — |
| 265,649 |
Foreign exchange, net | (608,211) |
| (2,879,339) |
| (30,724) |
| (151,280) |
| (74,013) |
| (1,312,732) |
| 3,518,274 |
| — |
| (1,538,025) |
Derivatives | 402,949 |
| 2,917,537 |
| (4,665) |
| 34,033 |
| 33,098 |
| 1,330,068 |
| (3,315,821) |
| — |
| 1,397,199 |
Income tax (expense)benefit | (109,232) |
| (96,560) |
| (11,633) |
| (182,896) |
| (13,612) |
| 210,686 |
| 217,425 |
| — |
| 14,178 |
Profit (loss) for the period | 282,085 |
| 135,725 |
| (13,310) |
| 377,588 |
| 35,825 |
| 100,774 |
| (404,500) |
| (397,482) |
| 116,705 |
Profit (loss) attributable to: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Owners of the Company | 244,384 |
| 137,284 |
| (13,310) |
| 372,196 |
| 25,286 |
| 102,250 |
| (368,358) |
| (397,482) |
| 102,250 |
Non-controlling interests | 37,701 |
| (1,559) |
| — |
| 5,392 |
| 10,539 |
| (1,476) |
| (36,142) |
| — |
| 14,455 |
| 282,085 |
| 135,725 |
| (13,310) |
| 377,588 |
| 35,825 |
| 100,774 |
| (404,500) |
| (397,482) |
| 116,705 |
Other select data |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization | 1,197,519 |
| 78,221 |
| 142,584 |
| 116,762 |
| 23,468 |
| 3,290 |
| (1,418,324) |
| — |
| 143,520 |
EBITDA | 1,924,846 |
| 475,651 |
| 192,580 |
| 677,841 |
| 111,945 |
| 476,940 |
| (2,593,077) |
| (397,482) |
| 869,244 |
Additions to PP&E, intangible and contract assets | 1,068,310 |
| 74,922 |
| 87,372 |
| 250,758 |
| 3,140 |
| 4,747 |
| (1,230,604) |
| — |
| 258,645 |
Reconciliation of EBITDA |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit (loss) for the period | 282,085 |
| 135,725 |
| (13,310) |
| 377,588 |
| 35,825 |
| 100,774 |
| (404,500) |
| (397,482) |
| 116,705 |
Income tax and (expense) benefit | 109,232 |
| 96,560 |
| 11,633 |
| 182,896 |
| 13,612 |
| (210,686) |
| (217,425) |
| — |
| (14,178) |
Finance results, net | 336,010 |
| 165,145 |
| 51,673 |
| 595 |
| 39,040 |
| 583,562 |
| (552,828) |
| — |
| 623,197 |
Depreciation and amortization | 1,197,519 |
| 78,221 |
| 142,584 |
| 116,762 |
| 23,468 |
| 3,290 |
| (1,418,324) |
| — |
| 143,520 |
EBITDA | 1,924,846 |
| 475,651 |
| 192,580 |
| 677,841 |
| 111,945 |
| 476,940 |
| (2,593,077) |
| (397,482) |
| 869,244 |
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
| March 31, 2021 | ||||||||||||||||||
| Reported segments |
| Reconciliation | Consolidated | |||||||||||||||
| Raízen Energia |
| Raízen Combustíveis |
| Gas and Energy |
| Moove |
| Logistics |
| Cosan Corporate |
| Deconsolidated effects |
| Segment elimination |
| |||
|
| Brazil |
| Argentina |
|
|
|
|
|
|
| ||||||||
Statement of financial position: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents | 4,042,966 |
| 2,011,708 |
| 593,072 |
| 1,424,003 |
| 900,064 |
| 3,724,605 |
| 1,884,498 |
| (6,647,746) |
| — |
| 7,933,170 |
Marketable securities | — |
| — |
| — |
| 788,702 |
| 186,220 |
| 1,746,047 |
| 1,014,690 |
| — |
| — |
| 3,735,659 |
Trade receivables | 1,421,788 |
| 2,230,966 |
| 580,390 |
| 1,073,911 |
| 615,839 |
| 620,870 |
| 782 |
| (4,233,144) |
| — |
| 2,311,402 |
Derivative financial instruments | 4,814,134 |
| 3,381,132 |
| — |
| 526,832 |
| 30,973 |
| 2,383,630 |
| 3,291,170 |
| (8,195,266) |
| — |
| 6,232,605 |
Inventories | 1,227,966 |
| 2,904,582 |
| 1,498,494 |
| 126,141 |
| 578,053 |
| 257,774 |
| 7 |
| (5,631,042) |
| — |
| 961,975 |
Sectorial financial assets | — |
| — |
| — |
| 184,105 |
| — |
| — |
| — |
| — |
| — |
| 184,105 |
Other financial assets | 154,940 |
| — |
| — |
| — |
| 69,381 |
| — |
| — |
| (154,940) |
| — |
| 69,381 |
Other current assets | 5,218,462 |
| 3,188,185 |
| 736,231 |
| 250,143 |
| 190,841 |
| 591,686 |
| 1,002,862 |
| (9,142,878) |
| (504,703) |
| 1,530,829 |
Other non-current assets | 5,758,948 |
| 2,199,360 |
| 51,234 |
| 174,664 |
| 303,242 |
| 2,878,845 |
| 1,905,722 |
| (8,009,542) |
| (463,278) |
| 4,799,195 |
Investments in associates | — |
| 3,713,879 |
| 390 |
| (1) |
| — |
| 50,082 |
| 9,956,732 |
| (3,714,269) |
| (9,624,173) |
| 382,640 |
Investments in joint ventures | 560,064 |
| 757,228 |
| — |
| — |
| — |
| — |
| 8,145,564 |
| (1,317,292) |
| — |
| 8,145,564 |
Biological assets | 1,353,186 |
| — |
| — |
| — |
| — |
| — |
| — |
| (1,353,186) |
| — |
| — |
Derivative financial instruments | — |
| 2,768,998 |
| 117,434 |
| 589,634 |
| 12,459 |
| — |
| — |
| (2,886,432) |
| — |
| 602,093 |
Right-of-use assets | 5,233,892 |
| 81,424 |
| 430,312 |
| 19,119 |
| 45,585 |
| 7,787,692 |
| 32,911 |
| (5,745,628) |
| — |
| 7,885,307 |
Property, plant and equipment | 12,640,458 |
| 2,495,398 |
| 4,327,190 |
| 21,439 |
| 334,271 |
| 14,247,292 |
| 77,226 |
| (19,463,046) |
| — |
| 14,680,228 |
Intangible assets and goodwill | 3,596,404 |
| 2,471,303 |
| 40,239 |
| 8,946,407 |
| 1,315,639 |
| 7,214,055 |
| 27,068 |
| (6,107,946) |
| — |
| 17,503,169 |
Loans, borrowings and debentures | (16,849,614) |
| (6,728,597) |
| (856,567) |
| (6,185,908) |
| (847,762) |
| (15,594,719) |
| (13,947,645) |
| 24,434,778 |
| — |
| (36,576,034) |
Derivative financial instruments | (5,906,602) |
| (154,953) |
| (19,597) |
| (225,301) |
| — |
| — |
| (115,168) |
| 6,081,152 |
| — |
| (340,469) |
Trade payables | (4,253,194) |
| (5,646,695) |
| (1,011,285) |
| (1,127,985) |
| (683,358) |
| (496,192) |
| (2,436) |
| 10,911,174 |
| — |
| (2,309,971) |
Employee benefits payable | (478,168) |
| (93,398) |
| (84,356) |
| (48,450) |
| (64,243) |
| (133,822) |
| (16,003) |
| 655,922 |
| — |
| (262,518) |
Sectorial financial liabilities | — |
| — |
| — |
| (603,510) |
| — |
| — |
| — |
| — |
| — |
| (603,510) |
Other current liabilities | (2,089,192) |
| (3,727,929) |
| (1,524,233) |
| (385,124) |
| (244,394) |
| (996,903) |
| (502,583) |
| 7,341,354 |
| 41,068 |
| (2,087,936) |
Preferred shareholders payable in subsidiaries | — |
| — |
| — |
| — |
| — |
| — |
| (391,187) |
| — |
| — |
| (391,187) |
Leases | (4,588,316) |
| (95,631) |
| (391,249) |
| (9,767) |
| (47,754) |
| (2,991,574) |
| (38,095) |
| 5,075,196 |
| — |
| (3,087,190) |
Other non-current liabilities | (2,189,300) |
| (4,699,358) |
| (773,430) |
| (1,921,606) |
| (576,807) |
| (5,841,934) |
| (2,245,717) |
| 7,662,088 |
| 926,909 |
| (9,659,155) |
Total assets (net of liabilities) allocated by segment | 9,668,822 |
| 7,057,602 |
| 3,714,269 |
| 3,617,448 |
| 2,118,249 |
| 15,447,434 |
| 10,080,398 |
| (20,440,693) |
| (9,624,177) |
| 21,639,352 |
Total assets | 46,023,208 |
| 28,204,163 |
| 8,374,986 |
| 14,125,099 |
| 4,582,567 |
| 41,502,578 |
| 27,339,232 |
| (82,602,357) |
| (10,592,154) |
| 76,957,322 |
Shareholders' equity attributable to: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity attributable to owners of the Company | 9,578,833 |
| 6,777,863 |
| 3,714,269 |
| 3,554,347 |
| 1,473,416 |
| 4,596,413 |
| 10,070,893 |
| (20,070,965) |
| (9,624,177) |
| 10,070,892 |
Non-controlling interests | 89,989 |
| 279,739 |
| — |
| 63,101 |
| 644,833 |
| 10,851,021 |
| 9,505 |
| (369,728) |
| — |
| 11,568,460 |
Total shareholders' equity | 9,668,822 |
| 7,057,602 |
| 3,714,269 |
| 3,617,448 |
| 2,118,249 |
| 15,447,434 |
| 10,080,398 |
| (20,440,693) |
| (9,624,177) |
| 21,639,352 |
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
| December 31, 2020 | ||||||||||||||||
| Reported segments |
| Reconciliation | Consolidated | |||||||||||||
| Raízen Energia |
| Raízen Combustíveis |
| Gas and Energy |
| Moove |
| Cosan Corporate |
| Deconsolidated effects |
| Segment elimination |
| |||
|
| Brazil |
| Argentina |
|
|
|
|
|
| |||||||
Statement of financial position: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents | 2,293,506 |
| 752,369 |
| 396,039 |
| 1,899,533 |
| 936,345 |
| 1,778,175 |
| (3,441,914) |
| — |
| 4,614,053 |
Marketable securities | — |
| — |
| — |
| 1,188,625 |
| 168,066 |
| 914,879 |
| — |
| — |
| 2,271,570 |
Trade receivables | 1,835,656 |
| 2,070,824 |
| 358,816 |
| 1,121,612 |
| 483,227 |
| — |
| (4,265,296) |
| — |
| 1,604,839 |
Derivative financial instruments | 4,904,580 |
| 2,835,980 |
| — |
| 517,181 |
| 28,463 |
| 2,581,774 |
| (7,740,560) |
| — |
| 3,127,418 |
Inventories | 3,975,086 |
| 3,068,435 |
| 1,274,045 |
| 121,064 |
| 564,836 |
| — |
| (8,317,566) |
| — |
| 685,900 |
Sectorial financial assets | — |
| — |
| — |
| 241,749 |
| — |
| — |
| — |
| — |
| 241,749 |
Other financial assets | 160,600 |
| — |
| — |
| — |
| 69,126 |
| 779,695 |
| (160,600) |
| — |
| 848,821 |
Other current assets | 4,862,274 |
| 3,003,780 |
| 769,740 |
| 276,139 |
| 146,166 |
| 1,211,108 |
| (8,635,794) |
| (601,024) |
| 1,032,389 |
Other non-current assets | 5,374,084 |
| 2,247,516 |
| 61,018 |
| 169,905 |
| 398,796 |
| 1,566,400 |
| (7,682,618) |
| (365,383) |
| 1,769,718 |
Investments in associates | — |
| 3,299,738 |
| 356 |
| — |
| — |
| 4,989,472 |
| (3,300,094) |
| (4,655,767) |
| 333,705 |
Investments in joint ventures | 536,540 |
| 769,252 |
| — |
| — |
| — |
| 7,988,208 |
| (1,305,792) |
| — |
| 7,988,208 |
Biological assets | 1,073,582 |
| — |
| — |
| — |
| — |
| — |
| (1,073,582) |
| — |
| — |
Derivative financial instruments | — |
| 2,764,818 |
| 95,840 |
| 686,690 |
| 9,248 |
| — |
| (2,860,658) |
| — |
| 695,938 |
Right-of-use assets | 4,698,238 |
| 86,737 |
| 425,391 |
| 19,865 |
| 39,550 |
| 24,809 |
| (5,210,366) |
| — |
| 84,224 |
Property, plant and equipment | 11,667,442 |
| 2,544,094 |
| 3,953,982 |
| 15,326 |
| 327,535 |
| 74,135 |
| (18,165,518) |
| — |
| 416,996 |
Intangible assets and goodwill | 3,599,864 |
| 2,479,947 |
| 9,221 |
| 8,769,986 |
| 1,268,095 |
| 7,215 |
| (6,089,032) |
| — |
| 10,045,296 |
Loans, borrowings and debentures | (17,516,886) |
| (6,258,929) |
| (781,703) |
| (7,043,909) |
| (802,938) |
| (7,580,380) |
| 24,557,518 |
| — |
| (15,427,227) |
Derivative financial instruments | (4,502,866) |
| (246,237) |
| (15,155) |
| (286,018) |
| (348) |
| (131,461) |
| 4,764,258 |
| — |
| (417,827) |
Trade payables | (3,244,436) |
| (5,203,174) |
| (863,672) |
| (1,182,111) |
| (688,139) |
| (4,942) |
| 9,311,282 |
| — |
| (1,875,192) |
Employee benefits payable | (383,114) |
| (85,993) |
| (65,269) |
| (74,543) |
| (96,192) |
| (25,146) |
| 534,376 |
| — |
| (195,881) |
Sectorial financial liabilities | — |
| — |
| — |
| (565,911) |
| — |
| — |
| — |
| — |
| (565,911) |
Other current liabilities | (3,014,286) |
| (2,729,837) |
| (1,186,505) |
| (662,779) |
| (290,827) |
| (673,340) |
| 6,930,628 |
| 40,998 |
| (1,585,948) |
Preferred shareholders payable in subsidiaries | — |
| — |
| — |
| — |
| — |
| (387,044) |
| — |
| — |
| (387,044) |
Leases | (4,246,196) |
| (101,500) |
| (387,074) |
| (10,320) |
| (41,299) |
| (28,144) |
| 4,734,770 |
| — |
| (79,763) |
Other non-current liabilities | (2,015,788) |
| (4,942,688) |
| (744,976) |
| (1,856,161) |
| (554,141) |
| (2,235,324) |
| 7,703,452 |
| 925,409 |
| (3,720,217) |
Total assets (net of liabilities) allocated by segment | 10,057,880 |
| 6,355,132 |
| 3,300,094 |
| 3,345,923 |
| 1,965,569 |
| 10,850,089 |
| (19,713,106) |
| (4,655,767) |
| 11,505,814 |
Total assets | 44,981,452 |
| 25,923,490 |
| 7,344,448 |
| 15,027,675 |
| 4,439,453 |
| 21,915,870 |
| (78,249,390) |
| (5,622,174) |
| 35,760,824 |
Shareholders' equity attributable to: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Equity attributable to owners of the Company | 9,967,891 |
| 6,075,393 |
| 3,300,094 |
| 3,288,315 |
| 1,367,157 |
| 10,847,666 |
| (19,343,378) |
| (4,655,473) |
| 10,847,665 |
Non-controlling interests | 89,989 |
| 279,739 |
| — |
| 57,608 |
| 598,412 |
| 2,423 |
| (369,728) |
| (294) |
| 658,149 |
Total shareholders' equity | 10,057,880 |
| 6,355,132 |
| 3,300,094 |
| 3,345,923 |
| 1,965,569 |
| 10,850,089 |
| (19,713,106) |
| (4,655,767) |
| 11,505,814 |
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
4.1 Net sales by segment
| March 31, 2021 |
| December 31, 2020 |
Reported segment |
|
|
|
Raízen Energia |
|
|
|
Ethanol | 3,735,930 |
| 3,669,801 |
Sugar | 3,437,927 |
| 2,302,881 |
Gas | 587,717 |
| 824,047 |
Diesel | 1,025,346 |
| 1,512,534 |
Cogeneration | 494,691 |
| 667,281 |
Other | 142,985 |
| 18,789 |
| 9,424,596 |
| 8,995,333 |
Raízen Combustíveis |
|
|
|
Fuels | 26,030,763 |
| 23,240,477 |
Other | 456,319 |
| 283,648 |
| 26,487,082 |
| 23,524,125 |
Gas and Energy |
|
|
|
Natural gas |
|
|
|
Industrial | 1,508,875 |
| 1,487,813 |
Residential | 294,334 |
| 311,140 |
Cogeneration | 140,769 |
| 94,195 |
Automotive | 59,859 |
| 76,296 |
Commercial | 89,890 |
| 126,311 |
Construction revenue | 179,282 |
| 197,221 |
Other | 24,403 |
| 13,594 |
| 2,297,412 |
| 2,306,570 |
Electricity trading | 219,210 |
| 168,775 |
Moove |
|
|
|
Finished goods | 1,257,545 |
| 953,350 |
Basic oil | 128,952 |
| 51,394 |
Services | 31,059 |
| 26,423 |
| 1,417,556 |
| 1,031,167 |
Logistics |
|
|
|
North operations | 589,227 |
| — |
South operations | 169,880 |
| — |
Container operations | 26,244 |
| — |
| 785,351 |
| — |
Reconciliation |
|
|
|
Cosan Corporate | 353 |
| — |
Deconsolidated effects and eliminations | (35,915,761) |
| (32,519,458) |
Total | 4,715,799 |
| 3,506,512 |
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
5 Financial assets and liabilities
Financial assets and liabilities are as following:
|
|
| Parent Company |
| Consolidated | ||||
| Note |
| March 31, 2021 |
| December 31, 2020 |
| March 31, 2021 |
| December 31, 2020 |
Assets |
|
|
|
|
|
|
|
|
|
Fair value through profit or loss |
|
|
|
|
|
|
|
|
|
Cash and cash equivalents | 5.1 |
| 704,884 |
| 1,148,860 |
| 1,509,462 |
| 2,154,257 |
Marketable securities | 5.2 |
| 844,191 |
| 788,965 |
| 3,735,659 |
| 2,271,570 |
Other financial assets | 5.4 |
| — |
| 779,695 |
| 69,381 |
| 848,821 |
Derivate financial instruments | 5.10 |
| 3,176,571 |
| 2,457,604 |
| 6,232,605 |
| 3,127,418 |
|
|
| 4,725,646 |
| 5,175,124 |
| 11,547,107 |
| 8,402,066 |
Amortized cost |
|
|
|
|
|
|
|
|
|
Cash and cash equivalents | 5.1 |
| 544,783 |
| 407 |
| 6,423,708 |
| 2,459,796 |
Trade receivables | 5.3 |
| — |
| — |
| 2,311,402 |
| 1,604,839 |
Receivables from related parties | 5.5 |
| 706,837 |
| 760,342 |
| 377,466 |
| 271,766 |
Sector financial assets | 5.9 |
| — |
| — |
| 184,105 |
| 241,749 |
Dividends receivable |
|
| 177,032 |
| 160,694 |
| 102,592 |
| 77,561 |
|
|
| 1,428,652 |
| 921,443 |
| 9,399,273 |
| 4,655,711 |
Total |
|
| 6,154,298 |
| 6,096,567 |
| 20,946,380 |
| 13,057,777 |
| Note |
| March 31, 2021 |
| December 31, 2020 |
| March 31, 2021 |
| December 31, 2020 |
Liabilities |
|
|
|
|
|
|
|
|
|
Amortized cost |
|
|
|
|
|
|
|
|
|
Loans, borrowings and debentures | 5.6 |
| (1,761,793) |
| — |
| (17,224,203) |
| (8,590,199) |
Trade payables | 5.7 |
| (1,323) |
| (4,066) |
| (2,309,971) |
| (1,875,192) |
Other financial liabilities |
|
| — |
| — |
| (509,656) |
| (149,293) |
Lease liabilities | 5.8 |
| (37,614) |
| (28,145) |
| (3,087,190) |
| (79,763) |
Installment Leases and concessions under | 11 |
| — |
| — |
| (3,015,484) |
| — |
Payables to related parties | 5.5 |
| (7,939,597) |
| (7,374,879) |
| (366,835) |
| (150,484) |
Preferred shareholders payable in subsidiaries |
|
| (391,187) |
| (387,044) |
| (391,187) |
| (387,044) |
Dividends payable |
|
| (68,899) |
| (216,929) |
| (147,214) |
| (285,177) |
Sector financial liabilities | 5.9 |
| — |
| — |
| (603,510) |
| (565,911) |
Tax installments - REFIS | 12 |
| (193,108) |
| (193,353) |
| (201,885) |
| (199,586) |
|
|
| (10,393,521) |
| (8,204,416) |
| (27,857,135) |
| (12,282,649) |
Fair value through profit or loss |
|
|
|
|
|
|
|
|
|
Loans, borrowings and debentures | 5.6 |
| (4,254,085) |
| — |
| (19,351,831) |
| (6,837,028) |
Consideration payable |
|
| — |
| — |
| (218,115) |
| (224,787) |
Derivative financial instruments | 5.10 |
| (115,168) |
| (131,462) |
| (340,469) |
| (417,827) |
|
|
| (4,369,253) |
| (131,462) |
| (19,910,415) |
| (7,479,642) |
Total |
|
| (14,762,774) |
| (8,335,878) |
| (47,767,550) |
| (19,762,291) |
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
5.1 Cash and cash equivalents
| Parent Company |
| Consolidated | ||||
| March 31, 2021 |
| December 31, 2020 |
| March 31, 2021 |
| December 31, 2020 |
Cash and bank accounts | 544,621 |
| 255 |
| 685,467 |
| 75,160 |
Savings account | — |
| — |
| 1,066,876 |
| 986,379 |
Financial investments | 705,046 |
| 1,149,012 |
| 6,180,827 |
| 3,552,514 |
| 1,249,667 |
| 1,149,267 |
| 7,933,170 |
| 4,614,053 |
Financial investments include the following:
|
| Parent company |
| Consolidated | ||||
|
| March 31, 2021 |
| December 31, 2020 |
| March 31, 2021 |
| December 31, 2020 |
Investment fund |
|
|
|
|
|
|
|
|
Repurchase agreements |
| 545,619 |
| 856,078 |
| 1,234,537 |
| 1,671,802 |
Bank certificate of deposits - CDB |
| 159,265 |
| 292,782 |
| 261,377 |
| 474,910 |
Other |
| — |
| — |
| 13,548 |
| 7,545 |
|
| 704,884 |
| 1,148,860 |
| 1,509,462 |
| 2,154,257 |
Bank investments |
|
|
|
|
|
|
|
|
Repurchase agreements |
| — |
| — |
| 54,397 |
| 1,293,833 |
Bank certificate of deposits - CDB |
| — |
| — |
| 4,500,543 |
| 104,272 |
Other |
| 162 |
| 152 |
| 116,425 |
| 152 |
|
| 162 |
| 152 |
| 4,671,365 |
| 1,398,257 |
|
| 705,046 |
| 1,149,012 |
| 6,180,827 |
| 3,552,514 |
The Company’s onshore financial investments are remunerated at rates around 100% of the Brazilian interbank offering rate (Certificado de Depósito Interbancário), or “CDI,” on March 31, 2021 (97% of CDI on December 31, 2020) and offshore financial investments are remunerated at rates around 100% of Fed funds. The sensitivity analysis on interest rate risks is in note 5.12.
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
5.2 Marketable securities and restricted cash
Accounting policy Restricted cash are measured and classified at amortized cost, both of them with the average maturity of government bonds between two and five years, however they can be promptly redeemed and are subject to an insignificant risk of change in value. |
| Parent company |
| Consolidated | ||||
| March 31, 2021 |
| December 31, 2020 |
| March 31, 2021 |
| December 31, 2020 |
Marketable securities |
|
|
|
|
|
|
|
Government security (i) | 844,191 |
| 788,965 |
| 3,730,333 |
| 2,271,570 |
Bank certificate of deposit - CDB | — |
| — |
| 5,326 |
| — |
| 844,191 |
| 788,965 |
| 3,735,659 |
| 2,271,570 |
Restricted cash |
|
|
|
|
|
|
|
Securities pledged as collateral | 30,012 |
| — |
| 59,872 |
| — |
| 30,012 |
| — |
| 59,872 |
| — |
(i) Government securities have stated interest connected to Special System for Settlement and Custody (Sistema Especial de Liquidação e de Custódia), or “SELIC”, with a return of approximately 100% of the CDI.
5.3 Trade receivables
|
| Consolidated | ||
|
| March 31, 2021 |
| December 31, 2020 |
Domestic – Local currency |
| 2,357,843 |
| 1,717,683 |
Export – Foreign currency |
| 81,750 |
| 17,502 |
|
| 2,439,593 |
| 1,735,185 |
|
|
|
|
|
Expected credit losses |
| (128,191) |
| (130,346) |
|
| 2,311,402 |
| 1,604,839 |
|
|
|
|
|
Current |
| 2,285,407 |
| 1,585,708 |
Non-current |
| 25,995 |
| 19,131 |
|
| 2,311,402 |
| 1,604,839 |
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
5.4 Other financial assets
The balance of other financial assets is composed as following:
|
|
| Parent Company |
| Consolidated | ||||
|
|
| March 31, 2021 |
| December 31, 2020 |
| March 31, 2021 |
| December 31, 2020 |
Rumo S.A. Shares (i) |
|
| — |
| 770,862 |
| — |
| 770,862 |
Cosan Logística S.A. Shares (i) |
|
| — |
| 8,833 |
| — |
| 8,833 |
Other financial assets (ii) |
|
| — |
| — |
| 69,381 |
| 69,126 |
|
|
| — |
| 779,695 |
| 69,381 |
| 848,821 |
Current |
|
| — |
| 779,695 |
| 69,381 |
| 848,821 |
|
|
| — |
| 779,695 |
| 69,381 |
| 848,821 |
(i) | Through the corporate reorganization detailed in note 1.2, the registered value of the shares started to be classified as investments. |
(ii) | On March 31, 2020, Cosan Lubes Investments Limited (“CLI”) received R$65,478 due to the satisfaction of the conditions precedent on December 31, 2019, as provided for in the investment agreement between the Company and CVC Fund VII (“CVC”). On April 15, 2021, the updated amount of R$ 68,876 was liquidated. |
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
5.5 Related parties
a) Summary of balances to related parties
|
| Parent Company |
| Consolidated | ||||
|
| March 31, 2021 |
| December 31, 2020 |
| March 31, 2021 |
| December 31, 2020 |
Current asset |
|
|
|
|
|
|
|
|
Commercial operations |
|
|
|
|
|
|
|
|
Raízen Energia S.A. (i) |
| 13,833 |
| 23,274 |
| 45,213 |
| 29,485 |
Rumo S.A |
| 1,330 |
| 4,289 |
| — |
| 8,388 |
Aguassanta Participações S.A. |
| 947 |
| 837 |
| 947 |
| 837 |
Cosan Lubrificantes e Especialidades (ii) |
| 12,149 |
| 219,613 |
| — |
| — |
Compass Gás e Energia |
| 3,562 |
| 3,732 |
| — |
| — |
Payly Soluções e Pagamentos S.A |
| 1,747 |
| 2,390 |
| — |
| — |
Raízen Combustíveis S.A. (i) |
| 1,953 |
| 644 |
| 9,134 |
| 1,448 |
Termag - Terminal Marítimo de Guarujá S.A. |
| — |
| — |
| 14,286 |
| — |
Other |
| 1,780 |
| 9,190 |
| 694 |
| 8,601 |
|
| 37,301 |
| 263,969 |
| 70,274 |
| 48,759 |
Financial operations |
|
|
|
|
|
|
|
|
Raízen Energia S.A. (i) |
| 22,245 |
| 21,141 |
| 22,245 |
| 21,141 |
Cosan Lubrificantes e Especialidades |
| 69,436 |
| — |
| — |
| — |
Raízen Combustíveis S.A. |
| 1,883 |
| 1,883 |
| 1,883 |
| 1,883 |
|
| 93,564 |
| 23,024 |
| 24,128 |
| 23,024 |
Total current assets |
| 130,865 |
| 286,993 |
| 94,402 |
| 71,783 |
Non-current assets |
|
|
|
|
|
|
|
|
Commercial operations |
|
|
|
|
|
|
|
|
Raízen Combustíveis S.A. (i) |
| — |
| — |
| 47,731 |
| — |
Termag - Terminal Marítimo de Guarujá S.A. |
| — |
| — |
| 75,000 |
| — |
|
| — |
| — |
| 122,731 |
| — |
Preferred shares |
|
|
|
|
|
|
|
|
Janus Brasil Participações S.A |
| 4,959 |
| — |
| 4,959 |
| — |
Raízen Combustíveis S.A. (i) |
| — |
| — |
| 199 |
| — |
|
| 4,959 |
| — |
| 5,158 |
| — |
Corporate / financial operations |
|
|
|
|
|
|
|
|
Raízen Energia S.A. |
| 155,175 |
| 155,175 |
| 155,175 |
| 155,175 |
Other |
| — |
| — |
| — |
| 44,808 |
Cosan Lubrificantes e Especialidades (ii) |
| 415,838 |
| 318,174 |
| — |
| — |
|
| 571,013 |
| 473,349 |
| 155,175 |
| 199,983 |
Total non-current assets |
| 575,972 |
| 473,349 |
| 283,064 |
| 199,983 |
Total assets |
| 706,837 |
| 760,342 |
| 377,466 |
| 271,766 |
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
|
| Parent Company |
| Consolidated | ||||
|
| March 31, 2021 |
| December 31, 2020 |
| March 31, 2021 |
| December 31, 2020 |
Current liabilities |
|
|
|
|
|
|
|
|
Commercial operations |
|
|
|
|
|
|
|
|
Raízen Energia S.A. (i) |
| 30,934 |
| 30,447 |
| 58,125 |
| 42,709 |
Raízen Combustíveis S.A. (i) |
| — |
| — |
| 206,382 |
| — |
Rumo S.A |
| 387 |
| 571 |
| — |
| 704 |
Cosan Lubrificantes e Especialidades (ii) |
| 533 |
| 8,059 |
| — |
| — |
Other |
| 5,041 |
| 258 |
| 933 |
| 53 |
|
| 36,895 |
| 39,335 |
| 265,440 |
| 43,466 |
Corporate / financial operations |
|
|
|
|
|
|
|
|
Raízen Combustíveis S.A. (i) |
| 14,693 |
| 11,386 |
| 14,693 |
| 11,387 |
Cosan Overseas Limited (iii) |
| 36,814 |
| 33,579 |
| — |
| — |
Cosan Luxembourg S.A. (iii) |
| 23,275 |
| 103,643 |
| — |
| — |
Raízen Energia S.A. |
| 81,978 |
| 90,797 |
| 86,561 |
| 95,631 |
Shell Brazil Holding B.V. |
| — |
| — |
| 141 |
| — |
|
| 156,760 |
| 239,405 |
| 101,395 |
| 107,018 |
Total current liabilities |
| 193,655 |
| 278,740 |
| 366,835 |
| 150,484 |
Non-current liabilities |
|
|
|
|
|
|
|
|
Corporate / financial operations |
|
|
|
|
|
|
|
|
Cosan Lubrificantes e Especialidades (ii) |
| 877,012 |
| 875,690 |
| — |
| — |
Cosan Luxembourg S.A. (iii) |
| 3,951,078 |
| 3,603,911 |
| — |
| — |
Aldwich |
| 49,261 |
| — |
| — |
| — |
Cosan Overseas Limited (iii) |
| 2,868,591 |
| 2,616,538 |
| — |
| — |
Total non-current liabilities |
| 7,745,942 |
| 7,096,139 |
| — |
| — |
Total liabilities |
| 7,939,597 |
| 7,374,879 |
| 366,835 |
| 150,484 |
(i) | Current and non-current assets receivable from Raízen Energia and Raízen Combustíveis are, primarily, tax credits which will be reimbursed to the Company when realized. The preferred shares are used to Raízen reimburse Cosan, with preferential dividends, when the net operating loss is consumed in Raízen. |
Current liabilities represent amounts owed to Raízen Energia and Raízen Combustíveis related to expenses regarding legal disputes and other liabilities, generated before the formation of joint ventures, which are responsibility of Cosan S.A.. | |
(ii) | On December 31, 2018, a contract for the assumption of rights and obligations between the Company and the subsidiary CLE was signed and assets and liabilities related to the fuel business were transferred from the acquisition of Esso Brasileira de Petróleo Ltda. (“Esso”) in 2008, which were not contributed to the formation of Raízen, a fact that generated an increase in the active and passive accounts of related parties of the Company in that year and which has been moved as the transactions are settled. This transfer of assets and liabilities does not impact the consolidated position of Company. nor the information by segment. |
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
(iii) | These operations serve as a vehicle for the transfer of resources from the Company to the subsidiaries, which are the bondholders and who are responsible for honoring their obligations. The increases observed in these liability balances refer to the exchange rate variation, which affected the PPE (Export Prepayment) operations that we have today between the Companies and the subsidiaries Cosan Luxemburgo S.A and Cosan Overseas Limited. |
b) Related party transactions
| Parent Company |
| Consolidated | ||||
| March 31, 2021 |
| March 31, 2020 |
| March 31, 2021 |
| March 31, 2020 |
Revenue |
|
|
|
|
|
|
|
Rumo S.A (i) | — |
| — |
| 10,636 |
| 7,662 |
Raízen Energia S.A. | — |
| — |
| 14,030 |
| 5,725 |
Raízen Combustíveis S.A | — |
| — |
| 8,945 |
| 10,046 |
Shell Energy do Brasil Ltda. | — |
| — |
| 7,934 |
| — |
| — |
| — |
| 41,545 |
| 23,433 |
Purchase of goods / inputs / services |
|
|
|
|
|
|
|
Raízen Energia S.A. | — |
| — |
| (13,332) |
| — |
Raízen Combustíveis S.A | — |
| — |
| (823) |
| — |
Other | — |
| — |
| — |
| (14) |
| — |
| — |
| (14,155) |
| (14) |
Shared (expenses) income |
|
|
|
|
|
|
|
Rumo S.A (i) | 842 |
| 1,192 |
| 842 |
| 1,192 |
Cosan Lubrificantes e Especialidades | 740 |
| 1,045 |
| — |
| — |
Payly Soluções de Pagtos S.A. | 36 |
| — |
| — |
| — |
Compass Gas e Energia S.A | 784 |
| — |
| — |
| — |
Comgas Cia De Gas De São Paulo | 328 |
| — |
| — |
| — |
Sinlog Tecnologia em Logística S.A. | 36 |
| — |
| 36 |
| — |
Raízen Energia S.A. | (1,258) |
| (1,061) |
| (12,245) |
| (13,201) |
| 1,508 |
| 1,176 |
| (11,367) |
| (12,009) |
Financial result |
|
|
|
|
|
|
|
Cosan Lubrificantes e Especialidades | — |
| (1,750) |
| — |
| — |
Cosan Limited (i) | 82 |
| 286 |
| 168 |
| 533 |
Cosan Luxembourg S.A. | (378,158) |
| (849,240) |
| — |
| — |
Cosan Overseas Limited | (311,234) |
| (639,973) |
| — |
| — |
Raízen Combustíveis S.A | 1,308 |
| 2,067 |
| — |
| — |
Aldwych Temple Venture | (1,491) |
| — |
| 1,308 |
| 2,067 |
| (689,493) |
| (1,488,610) |
| 1,476 |
| 2,600 |
Total | (687,985) |
| (1,487,434) |
| 17,499 |
| 14,010 |
(i) Balances related to the months before the date of the corporate restructuring 1.2.
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
c) Officers’ and directors’ compensation
The Company has a compensation policy approved by the Board of Directors that includes salaries, contributions to a post-employment defined benefit plan and share-based payment according notes 21 and 22.
| March 31, 2021 |
| March 31, 2020 |
Short-term benefits to officers and directors | 9,983 |
| 7,044 |
Share-based payment transactions | 445 |
| 3,762 |
Post-employment benefits | 87 |
| — |
| 10,515 |
| 10,806 |
5.6 Loans, borrowings and debentures
Description |
| Index |
| Annual interest rate |
| March 31, 2021 |
| December 31, 2020 |
| Maturity |
| Objective |
Without guarantee |
|
|
|
|
|
|
|
|
|
|
|
|
Senior Notes Due 2029 |
| Fixed 5,50% |
| 5.50% |
| 4,254,085 |
| — |
| Sep-29 |
| Acquisition |
Non-convertible debentures |
| CDI + 2,65 |
| 5.37% |
| 1,761,793 |
| — |
| Aug-25 |
| Investment |
Total |
|
|
|
|
| 6,015,878 |
| — |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current |
|
|
|
|
| 44,863 |
| — |
|
|
|
|
Non-current |
|
|
|
|
| 5,971,015 |
| — |
|
|
|
|
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
|
| Interest |
| Consolidated |
|
|
|
| ||||||||||
Description |
| Index |
| Annual interest rate |
| March 31, 2021 |
| December 31, 2020 |
| Maturity |
| Objective | ||||||
Secured |
|
|
|
|
|
|
|
|
|
|
|
| ||||||
BNDES |
| URTJLP |
| 6.51% |
| 3,060,887 |
| — |
| Dec-29 |
| Investment | ||||||
|
| Fixed |
| 5.63% |
| 600,795 |
| — |
| Jan-25 |
| Investment | ||||||
|
| IPCA |
| 7.46% |
| 831 |
| — |
| Nov-21 |
| Investment | ||||||
|
| URTJLP |
| 9.93% |
| 264 |
| — |
| Mar-22 |
| Investment | ||||||
|
| Fixed |
| 3.50% |
| 990 |
| — |
| Jan-24 |
| Investment | ||||||
|
| IPCA - 3.25% |
| 8.21% |
| 978,684 |
| 807,438 |
| Apr-29 |
| Investment | ||||||
|
| IPCA - 4.10% |
| 9.10% |
| 170,257 |
| 175,374 |
| Apr-29 |
| Investment | ||||||
Export Credit Agreement (ECA) |
| Euribor + 0,58% |
| 0.58% |
| 112,213 |
| — |
| Sep-26 |
| Investment | ||||||
European investment bank (EIB) |
| USD + Libor 6M + 0,54% |
| 0.80% |
| 33,725 |
| 30,817 |
| May-21 |
| Investment | ||||||
|
| USD + Libor 6M + 0,61% |
| 0.80% |
| 31,539 |
| 57,813 |
| Sep-21 |
| Investment | ||||||
|
|
|
|
|
| 4,990,185 |
| 1,071,442 |
|
|
|
| ||||||
Unsecured |
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Foreign loans |
| GBP+Libor 06 + 1,50% Base 365 |
| 1.40% |
| 157,557 |
| 143,039 |
| Jul-21 |
| Working capital | ||||||
|
| GBP - Fixed |
| 1.40% |
| 39,487 |
| 35,556 |
| Nov-22 |
| Working capital | ||||||
|
| GBP+Libor-06 + 1,10% Base 360 |
| 1.18% |
| 157,259 |
| 142,091 |
| Dec-21 |
| Acquisition | ||||||
|
| GBP+Libor-06 + 1,50% Base 360 |
| 1.53% |
| 276,269 |
| 248,666 |
| Dec-22 |
| Acquisition | ||||||
|
| EUR - Pré-fixado |
| 4.42% |
| 1,734 |
| 2,095 |
| Sep-22 |
| Investment | ||||||
|
| CDI + 1,03% |
| 3.70% |
| 82,792 |
| — |
| Feb-23 |
| Investment | ||||||
|
| CDI + 0,80% |
| 3.47% |
| 501,824 |
| — |
| Dec-23 |
| Investment | ||||||
Loan 4131 |
| USD |
| 0.93% |
| 299,534 |
| — |
| Nov-22 |
| Working capital | ||||||
|
| CDI |
| 4.60% |
| 209,466 |
| — |
| Apr-21 |
| Working capital | ||||||
|
| USD + 3,67% |
| 3.67% |
| 448,384 |
| 415,232 |
| May-23 |
| Investment | ||||||
|
| USD + 1,59% |
| 1.59% |
| — |
| 388,912 |
| Apr-21 |
| Investment | ||||||
|
| USD + 1,36% |
| 1.60% |
| 411,505 |
| — |
| Feb-24 |
| Investment | ||||||
|
| IPCA + 0,81% |
| 5.81% |
| 264,866 |
| — |
| Jan-48 |
| Working capital | ||||||
|
| Fixed |
| 1.87% |
| 20,209 |
| — |
| Oct-21 |
| Working capital | ||||||
Perpetual Notes |
| USD |
| 8.25% |
| 2,884,555 |
| 2,631,100 |
| Nov-40 |
| Acquisition | ||||||
Senior Notes Due 2023 |
| USD |
| 5.00% |
| 603,906 |
| 569,466 |
| Mar-23 |
| Acquisition | ||||||
Senior Notes Due 2025 |
| USD |
| 5.88% |
| 3,198,838 |
| — |
| Jan-25 |
| Acquisition | ||||||
Senior Notes Due 2027 |
| USD |
| 7.00% |
| 4,443,306 |
| 4,379,812 |
| Jan-27 |
| Acquisition | ||||||
Senior Notes Due 2028 |
| USD |
| 5.25% |
| 2,775,562 |
| — |
| Jan-28 |
| Acquisition | ||||||
Senior Notes Due 2029 |
| Fixed 5,50% |
| 5.50% |
| 4,254,085 |
| — |
| Sep-29 |
| Acquisition | ||||||
Prepayment |
| 100% Libor-03 - 3.50% base 360 |
| 0.00% |
| — |
| 27,129 |
| Mar-21 |
| Working capital | ||||||
|
| 100% Libor-03 - 1% base 360 |
| 1.20% |
| 115,420 |
| 104,318 |
| Nov-21 |
| Working capital | ||||||
Debentures |
| IPCA + 4,68% |
| 9.70% |
| 552,106 |
| — |
| Feb-26 |
| Investment | ||||||
|
| IPCA + 4,50% |
| 9.52% |
| 694,131 |
| — |
| Feb-29 |
| Investment | ||||||
|
| IPCA + 3,60% |
| 6.24% |
| 374,017 |
| — |
| Dec-30 |
| Working capital | ||||||
|
| CDI + 2,65 |
| 5.37% |
| 1,761,793 |
| — |
| Aug-25 |
| Investment | ||||||
|
| IPCA + 6,80% |
| 11.93% |
| 838,747 |
| — |
| Apr-30 |
| Investment | ||||||
|
| IPCA + 3,90% |
| 8.89% |
| 1,002,781 |
| — |
| Oct-29 |
| Investment | ||||||
|
| IPCA + 4,00% |
| 8.99% |
| 1,003,867 |
| — |
| Dec-35 |
| Investment | ||||||
|
| IPCA + 7,48% |
| 12.64% |
| 312,369 |
| 299,524 |
| Dec-22 |
| Investment | ||||||
|
| IPCA + 7,36% |
| 12.51% |
| 102,168 |
| 97,956 |
| Dec-25 |
| Investment | ||||||
|
| IPCA + 5,87% |
| 10.95% |
| 883,036 |
| 890,658 |
| Dec-23 |
| Investment | ||||||
|
| IPCA + 4,33% |
| 9.34% |
| 468,629 |
| 452,457 |
| Oct-24 |
| Investment | ||||||
|
| IGPM + 6,10% |
| 19.49% |
| 325,315 |
| 298,706 |
| May-28 |
| Investment | ||||||
|
| 100% CDI +0,50% |
| 3.16% |
| 2,020,296 |
| 2,007,849 |
| Oct-22 |
| Investment | ||||||
Working capital |
| 100% CDI - 2.75% |
| 5.47% |
| 100,036 |
| 100,045 |
| Jun-22 |
| Working capital | ||||||
Promissory notes |
| 100% CDI - 3.00% |
| 4.96% |
| — |
| 601,058 |
| Apr-21 |
| Investment | ||||||
|
| 100% CDI - 3.40% |
| 5.36% |
| — |
| 520,116 |
| Apr-21 |
| Investment | ||||||
|
|
|
|
|
| 31,585,849 |
| 14,355,785 |
|
|
|
| ||||||
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Total |
|
|
|
|
| 36,576,034 |
| 15,427,227 |
|
|
|
| ||||||
|
|
|
|
|
|
|
|
|
|
|
|
| ||||||
Current |
|
|
|
|
| 2,413,080 |
| 2,352,057 |
|
|
|
| ||||||
Non-current |
|
|
|
|
| 34,162,954 |
| 13,075,170 |
|
|
|
|
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
The Company used the annual average rate of the CDI of 2.65% and Long-term Interest Rate (Taxa de Juros de Longo Prazo), or “TJLP,” of 4.39%.
Non-current borrowings are scheduled to fall due as follows:
|
| Parent Company |
| Consolidated | ||||
|
| March 31, 2021 |
| December 31, 2020 |
| March 31, 2021 |
| December 31, 2020 |
13 to 24 months |
| — |
| — |
| 4,343,252 |
| 2,605,687 |
25 to 36 months |
| 580,000 |
| — |
| 3,322,477 |
| 2,039,863 |
37 to 48 months |
| 580,000 |
| — |
| 5,009,523 |
| 623,971 |
49 to 60 months |
| 580,000 |
| — |
| 1,304,915 |
| 171,794 |
61 to 72 months |
| — |
| — |
| 5,047,022 |
| 238,050 |
73 to 84 months |
| — |
| — |
| 3,996,770 |
| 4,512,773 |
85 to 96 months |
| — |
| — |
| 1,609,097 |
| 238,095 |
Thereafter |
| 4,231,015 |
| — |
| 9,529,898 |
| 2,644,937 |
|
| 5,971,015 |
| — |
| 34,162,954 |
| 13,075,170 |
The carrying amounts of loans, borrowings and debentures are denominated in the following currencies:
|
| Parent Company |
| Consolidated | ||||
|
| March 31, 2021 |
| December 31, 2020 |
| March 31, 2021 |
| December 31, 2020 |
Brazilian reais (BRL) |
| 1,761,793 |
| — |
| 16,310,947 |
| 6,251,180 |
U.S. Dollar (USD) |
| 4,254,085 |
| — |
| 19,500,359 |
| 8,604,600 |
British pound (GBP) |
| — |
| — |
| 630,572 |
| 569,352 |
Euro (EUR) |
| — |
| — |
| 134,156 |
| 2,095 |
|
| 6,015,878 |
| — |
| 36,576,034 |
| 15,427,227 |
On February 23, 2021, the subsidiary Comgás, based on its Liability Management policy and current market conditions, decided to prepay the loan 4131 contracted with Scotiabank in April 2020, with exchange of indexer by means of swap considering tax of CDI + 2.75% and original maturity in April 2021, subsequently contracting a debt of equal value with the same counterparty, however, extending the term by three years to mature in February 2024, with exchange of indexer by means of swap tax of CDI + 1.25%. The only effect of this transaction on the interim financial statements for the three-month period ended March 31, 2021, was the positive result of the settlement of the swap for on 2020 operation with a net cash receipt of approximately R$5 million.
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
All debts denominated in U.S. dollar have currency risk protection through derivative financial instruments (Note 5.10), except for perpetual notes.
Below are the movements in loans, borrowings and debentures occurred for the period ended March 31, 2021:
|
| Parent Company |
| Consolidated |
March 31, 2020 |
| — |
| 15,427,227 |
Corporate reorganization (Note 1.2) |
| 5,982,343 |
| 26,817,519 |
Raised |
| — |
| 583,128 |
Amortization of principal (i) |
| (5,427) |
| (6,945,855) |
Payment of interest |
| (134,759) |
| (513,490) |
Interest, exchange rate and fair value |
| 173,721 |
| 1,207,505 |
March 31, 2021 |
| 6,015,878 |
| 36,576,034 |
(i) Debt settlement: Senior Notes Due 2024 (R$4,514,289), NCE CDI + 3.05% (R$208,464) and NCE CDI + 3.15% (R$468,516), by the subsidiary Rumo S.A..
a) Guarantees
The subsidiary Comgás has financing contracts with the European Investiment Bank (“EIB”), destined for investments and is guaranteed, according to each contract, by bank guarantee, with an average cost of 1.47% per year or by real guarantees (assets) and guarantee account. As of March 31, 2021, the balance of bank guarantees contracted was R$123,885 (R$113,000 on December 31, 2020).
In Rumo some financing contracts with the National Bank for Economic and Social Development (“BNDES”), intended for investments, are also guaranteed, according to each contract, by bank guarantee, with an average cost of 0.93% per year or by real guarantees (assets) and guarantee account. On March 31, 2021, the balance of bank guarantees contracted was R$3,392,192 (R$3,687,323 on December 31, 2020).
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
To calculate the average rates, the annual average CDI of 2.25% (2.78% as of December 31, 2020) and TJLP of 4.70% (4.87% as of December 31, 2020) were considered on an annual basis.
b) Available credit line
As of March 31, 2021, the Company had credit lines in banks with AA rating, which were not used, in the total amount of R$250,000 (R$250,000 on December 31, 2020) and R$1,201,981 (R$487,378 in December 31, 2020), to investee Rumo SA.
The use of these credit lines is subject to certain contractual conditions.
c) Financial covenants
Under the terms of the major borrowing facilities, the Company and its subsidiaries are required to comply with the following financial covenants:
Debt | Triggers | Ratios | ||
Debenture 4th Issue – Comgás | Short-term indebtedness/ Total indebtedness (iii) cannot exceed 0.6 | 0.05 | ||
Debenture 4th to 8th Issue – Comgás | Net debt (i) / EBITDA (ii) cannot exceed 4.00 | 1.70 | ||
BNDES - Comgás | 1.70 | |||
Resolution 4131 - Comgás | 1.70 | |||
Senior Notes Due 2027 - Cosan | Net debt pro forma (iv) / EBITDA (ii) | (iv) not higher than or equal to 3.5 | 3.00 | ||
Senior Notes Due 2029 - Cosan | Net debt (i) / EBITDA (ii) not higher than or equal to 3.5 | 3.00 | ||
Senior Notes Due 2025 - Rumo | Net debt (i) / EBITDA (ii) not higher than or equal to 3.3 | 2.00 | ||
BNDES - Rumo | EBITDA (ii) / Consolidated financial result (v) higher or equal 2.0x in December 2021 | 293.86 (vi) |
(i) | Net debt consists of current and non-current debt, net of cash and cash equivalents and marketable securities. Net debt is a non-GAAP measure. | |
(ii) | Corresponds to the accumulated EBITDA of the last twelve months. | |
(iii) | Indebtedness means the sum of current and noncurrent loans, financing and debentures, leases and current and noncurrent derivative financial instruments. |
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
(iv) | Net debt and EBITDA pro forma, including joint ventures financial information. Net debt and EBITDA pro forma are a non-GAAP measure. | |
(v) | The financial result of the net debt is represented by the cost of the net debt. | |
(vi) | The Rumo S.A. presented a financial result from the consolidated debt due to the prepayment of Senior Notes 2024, excluding the effects of this operation, the index would be 11.11. |
For the other loans, borrowings and debentures of the Company there are no debt financial covenants.
The terms of loans included cross-default provisions.
On March 31, 2021, the Company and its subsidiaries was in compliance with all debt financial covenants.
d) Fair value and exposure to financial risk
The fair value of the loans is based on the discounted cash flow using its implicit discount rate. They are classified as a level 2 fair value in the hierarchy (Note 5.10) due to the use of unobservable data, including own credit risk.
The details of the Company’s exposure to risks arising from loans are shown in Note 5.12.
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
5.7 Trade payables
The carrying amounts of suppliers and other accounts payable are the same as their fair values, due to their short-term nature.
|
| Parent Company |
| Consolidated | ||||
|
| March 31, 2021 |
| December 31, 2020 |
| March 31, 2021 |
| December 31, 2020 |
Materials and service suppliers |
| 1,323 |
| 4,066 |
| 1,450,456 |
| 1,095,051 |
Natural gas/ transport and logistics suppliers |
| — |
| — |
| 859,515 |
| 780,141 |
|
| 1,323 |
| 4,066 |
| 2,309,971 |
| 1,875,192 |
5.8 Leases
Accounting policy At the beginning or in the modification of a contract, the Company assesses whether a contract is or contains a lease.
The lease liability is initially measured at the present value of lease payments that are not made on the start date, discounted at the interest rate implicit in the lease or, if that rate cannot be determined immediately, by the Company’s incremental loan rate. The Company generally uses its incremental loan rate as a discount rate.
The lease payments included in the measurement of the lease liability comprise the following:
|
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
Subsequent valuation of the lease liability is at amortized cost, using the effective interest method. It is remeasured when there is a change in future lease payments resulting from a change in index or rate, if there is a change in the amounts that are expected to be paid according to the residual value guarantee, if the Company changes its valuation, an option will be exercised purchase, extension or termination or if there is an essentially fixed revised lease payment.
When the lease liability is remeasured in this way, an adjustment corresponding to the carrying amount of the right-of-use asset is made or is recorded in the income statement if the carrying amount of the right-of-use asset has been reduced to zero. |
| Consolidated | ||||||
| Financial |
| Operational - concessions |
| Operational - other |
| Total |
At January 1, 2021 | — |
| — |
| 79,763 |
| 79,763 |
Corporate reorganization (Note 1.2) | 403,008 |
| 2,353,947 |
| 194,006 |
| 2,950,961 |
Additions | — |
| — |
| 22,693 |
| 22,693 |
Appropriation of interest and exchange variation | 4,142 |
| 22,484 |
| 5,538 |
| 32,164 |
Repayments of principal from debts | (10,739) |
| (12,124) |
| (4,906) |
| (27,769) |
Payments of interest from debts | — |
| (16,514) |
| (1,968) |
| (18,482) |
Contractual adjustment | — |
| 47,815 |
| 45 |
| 47,860 |
At March 31, 2021 | 396,411 |
| 2,395,608 |
| 295,171 |
| 3,087,190 |
|
|
|
|
|
|
|
|
Current | 223,399 |
| 239,256 |
| 70,860 |
| 533,515 |
Non-current | 173,012 |
| 2,156,352 |
| 224,311 |
| 2,553,675 |
| 396,411 |
| 2,395,608 |
| 295,171 |
| 3,087,190 |
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
5.9 Sector financial asset and liability
The changes in net sector financial asset (liability) for the period ended March 31, 2021 were as follows:
|
| Sectorial assets |
| Sectorial liabilities |
| Total |
January 01, 2021 |
| 241,749 |
| (565,911) |
| (324,162) |
Cost of gas (i) |
| (59,010) |
| - |
| (59,010) |
Credits of taxes (ii) |
| - |
| (37,599) |
| (37,599) |
Monetary variations (iii) |
| 1,366 |
| - |
| 1,366 |
Other revenue (iv) |
| - |
| - |
| - |
March 31, 2021 |
| 184,105 |
| (603,510) |
| (419,405) |
|
|
|
|
|
|
|
Current |
| 184,105 |
| (92,386) |
| 91,719 |
Non-current |
| - |
| (511,124) |
| (511,124) |
|
| 184,105 |
| (603,510) |
| (419,405) |
(i) | Refers to the cost of gas purchased higher than that contained in the tariffs, 100% classified in current assets, since ARSESP's resolution provides for tariff recovery on a quarterly basis. |
(ii) | Credits, mainly, from the exclusion of ICMS on the basis of PIS and COFINS, which will be returned to consumers when the lawsuit is final, and which should be discussed with ARSESP regarding the mechanisms and criteria for reimbursement. |
(iii) | Monetary restatement on the current gas account, based on the SELIC rate. |
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
5.10 Derivative financial instruments
| Notional |
| Fair value | ||||
| March 31, 2021 |
| December 31, 2020 |
| March 31, 2021 |
| December 31, 2020 |
Fuel derivative agreements |
|
|
|
|
|
|
|
Forward agreements (i) | — |
| 13,422 |
| — |
| (348) |
|
|
|
|
|
|
|
|
Energy derivative agreements |
|
|
|
|
|
|
|
Forward agreements (ii) | 1,374,618 |
| 1,354,967 |
| (137,781) |
| (189,423) |
|
|
|
|
|
|
|
|
Exchange rate derivatives |
|
|
|
|
|
|
|
Forward agreements | 1,540,336 |
| 345,144 |
| 86,318 |
| (509) |
|
|
|
|
|
|
|
|
Interest rate and exchange rate risk |
|
|
|
|
|
|
|
Swap agreements (shares) (iii) | 600,000 |
| — |
| 308,440 |
| — |
Swap agreements (interest rate) | 4,463,765 |
| 1,170,861 |
| 645,488 |
| 346,488 |
Swap agreements (exchange and interest rate) | 11,124,750 |
| 4,281,071 |
| 4,989,671 |
| 2,553,383 |
| 16,188,515 |
| 5,451,932 |
| 5,943,599 |
| 2,899,871 |
|
|
|
|
|
|
|
|
Total financial instruments |
| 5,892,136 |
| 2,709,591 | |||
|
|
|
|
|
|
|
|
Current assets |
|
|
|
| 382,585 |
| 156,208 |
Non-current assets |
|
|
|
| 5,850,020 |
| 2,971,210 |
Current liabilities |
|
|
|
| (225,870) |
| (293,656) |
Non-current liabilities |
|
|
|
| (114,599) |
| (124,171) |
Total |
|
|
|
| 5,892,136 |
| 2,709,591 |
(i) | Forward contracts for fuels contracted by the subsidiary Moove, which seek to reduce possible impacts on the price fluctuation of the commodity that can affect our lubricant costs. |
(ii) | The subsidiary Compass Gás e Energia has a portfolio of energy contracts (purchase and sale) aimed at meeting demands and offers for consumption or supply of energy. In addition, there is a portfolio of contracts that comprises forward positions, usually short-term. For this portfolio, there is no purchase commitment with a sales contract. |
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
(iii) | The Company contracted a Total Return Swap, with Banco Santander (Brasil) S.A. In accordance with the total return swap, which will have a financial settlement, Cosan will receive the return on the variation in the price of CSAN3 shares adjusted by the dividends for the period and will pay interest annual rates referenced to CDI + Spread. The equivalent contracted amount of CSAN3 shares with a total return swap was 9,937,003 and the total initial value is R$600,000. |
Derivatives are only used for economic hedging purposes and not as speculative investments.
Fair value hedge
Currently the Company has adopted the hedge accounting of fair value for some its operations. Both the hedging instruments and the hedged items are measured and recognized at fair value through profit or loss.
The effects of the foreign currency-related hedging instruments and interest rate swaps on the Company’s financial position and performance are as follows:
|
|
| Book value |
| Accumulated fair value adjustment | ||||
| Notional |
| March 31, 2021 |
| December 31, 2020 |
| March 31, 2021 |
| December 31, 2020 |
Exchange rate hedge |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Designated items |
|
|
|
|
|
|
|
|
|
Senior notes 2025 (Rumo Luxembourg) | (1,740,550) |
| (3,198,838) |
| — |
| 15,777 |
| — |
Senior notes 2028 (Rumo Luxembourg) | (2,791,600) |
| (2,775,562) |
| — |
| 71,314 |
| — |
Total debt | (4,532,150) |
| (5,974,400) |
| — |
| 87,091 |
| — |
|
|
|
|
|
|
|
|
|
|
Derivative financial instruments |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Senior swaps notes 2025 (Rumo Luxembourg) | 1,740,550 |
| 1,485,832 |
| — |
| (13,748) |
| — |
Senior swaps notes 2028 (Rumo Luxembourg) | 2,791,600 |
| 494,411 |
| — |
| 5,589 |
| — |
Derivative total | 4,532,150 |
| 1,980,243 |
| — |
| (8,159) |
| — |
|
|
|
|
|
|
|
|
|
|
Total | — |
| (3,994,157) |
| — |
| 78,932 |
| — |
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
|
|
| Book value |
| Accumulated fair value adjustment | ||||
| Notional |
| March 31, 2021 |
| December 31, 2020 |
| March 31, 2021 |
| December 31, 2020 |
Interest rate hedge |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Designated items |
|
|
|
|
|
|
|
|
|
Senior notes 2023 (Cosan Luxembourg) | (691,157) |
| (603,906) |
| (569,466) |
| (231,636) |
| (237,050) |
Debenture 3rd issue - 3rd series (Comgás) | — |
| — |
| — |
| — |
| 575 |
Debenture 5th issue - single series (Comgás) | (684,501) |
| (883,036) |
| (890,658) |
| 7,622 |
| (22,040) |
Debenture (Rumo) | (2,329,136) |
| (2,380,664) |
| — |
| 36,984 |
| — |
Total debt | (3,704,794) |
| (3,867,606) |
| (1,460,124) |
| (187,030) |
| (258,515) |
|
|
|
|
|
|
|
|
|
|
Derivative financial instruments |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Senior swaps notes 2023 (Cosan Luxembourg) | 691,157 |
| 433,317 |
| 392,899 |
| 35,012 |
| (42,532) |
Debenture 3rd issue swaps - 3rd series (Comgás) | — |
| — |
| — |
| — |
| 862 |
Debenture 5th issue swaps - single series (Comgás) | 684,501 |
| 195,752 |
| 211,741 |
| (15,989) |
| 10,731 |
Debenture Swap (Rumo) | 2,354,965 |
| 123,905 |
| — |
| 7,627 |
| — |
Derivative total | 3,730,623 |
| 752,974 |
| 604,640 |
| 26,650 |
| (30,939) |
|
|
|
|
|
|
|
|
|
|
Total | 25,829 |
| (3,114,632) |
| (855,484) |
| (160,380) |
| (289,454) |
Fair value option
Certain derivative instruments have not been linked to documented hedge structures. The Company opted to designate the protected liabilities (hedge objects) to be recorded at fair value through profit or loss. Considering that derivative instruments are always accounted for at fair value through profit or loss, the accounting effects are the same that would be obtained through hedge documentation:
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
|
|
|
|
| Book value |
| Accumulated fair value adjustment | ||||
|
|
| Notional |
| March 31, 2021 |
| December 31, 2020 |
| March 31, 2021 |
| December 31, 2020 |
Exchange rate hedge |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Objects |
|
|
|
|
|
|
|
|
|
|
|
Sênior Notes 2027 | USD+7,0% |
| (3,703,245) |
| (4,461,557) |
| (4,379,812) |
| 207,213 |
| (349,181) |
EIB 3ª Tranche | US$ + LIBOR6M + 0,54% |
| (9,625) |
| (33,725) |
| (30,817) |
| 507 |
| 156 |
EIB 4ª Tranche | US$ + LIBOR6M + 0,61% |
| (9,237) |
| (31,539) |
| (57,813) |
| 441 |
| 308 |
Loan 4131 (Comgás - 2018) | US$ + 3,67% |
| (268,125) |
| (448,384) |
| (415,232) |
| (15,811) |
| (24,247) |
Loan 4131 (Comgás - 2020) | US$ + 1,59% |
| — |
| — |
| (388,912) |
| — |
| 1,967 |
Loan 4131 (Comgás - 2021) | US$ + 1,60% |
| (407,250) |
| (411,505) |
| — |
| 16,374 |
| — |
ECA | EUR + 0,58% |
| (100,198) |
| (112,213) |
| — |
| 11,588 |
| — |
Loan 4131 (Rumo) | USD + 2,20% |
| (220,000) |
| (299,534) |
| — |
| 3,162 |
| — |
Total |
|
| (4,717,680) |
| (5,798,457) |
| (5,272,586) |
| 223,474 |
| (370,997) |
|
|
|
|
|
|
|
|
|
|
|
|
Derivative instruments |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FX and interest swap | BRL + 126,85% do CDI |
| 3,703,245 |
| 2,157,170 |
| 2,272,648 |
| 270,391 |
| 1,320,629 |
EIB 3ª Tranche | BRL + 88,5% do CDI |
| 9,625 |
| 23,789 |
| 21,176 |
| 2,613 |
| 24,927 |
EIB 4ª Tranche | BRL + 81,1% do CDI |
| 9,237 |
| 22,120 |
| 39,256 |
| 4,891 |
| 26,219 |
Loan 4131 (Comgás - 2018) | BRL + 107,9% do CDI |
| 268,125 |
| 192,812 |
| 154,627 |
| 38,185 |
| 117,080 |
Loan 4131 (Comgás - 2020) | BRL + CDI + 2,75% |
| — |
| — |
| (6,214) |
| 15,711 |
| (12,904) |
Loan 4131 (Comgás - 2021) | BRL + CDI + 1,25% |
| 407,250 |
| 4,811 |
| — |
| 4,811 |
| — |
Inflation and interest rate swaps | BRL + 107% do CDI |
| 100,198 |
| 42,327 |
| — |
| (5,902) |
| — |
Inflation and interest rate swaps | BRL + 118% do CDI |
| 220,000 |
| 100,438 |
| — |
| 4,128 |
| — |
Derivative total |
|
| 4,717,680 |
| 2,543,467 |
| 2,481,493 |
| 334,828 |
| 1,475,951 |
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
| — |
| (3,254,990) |
| (2,791,093) |
| 558,302 |
| 1,104,954 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| Book value |
| Accumulated fair value adjustment | ||||
|
|
| Notional |
| March 31, 2021 |
| December 31, 2020 |
| March 31, 2021 |
| December 31, 2020 |
Interest rate hedge |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Objects |
|
|
|
|
|
|
|
|
|
|
|
Debenture (Rumo) | IPCA + 4,68% |
| (500,000) |
| (552,106) |
| — |
| (3,056) |
| — |
Debenture (Rumo) | IPCA + 4,50% |
| (600,000) |
| (694,131) |
| — |
| 1,757 |
| — |
Total |
|
| (1,100,000) |
| (1,246,237) |
| — |
| (1,299) |
| — |
|
|
|
|
|
|
|
|
|
|
|
|
Derivative instruments |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FX and interest swap | 107% CDI |
| 500,000 |
| 70,819 |
| — |
| (2,658) |
| — |
FX and interest swap | 105% CDI |
| 600,000 |
| 90,259 |
| — |
| (5,306) |
| — |
Derivative total |
|
| — |
| — |
| — |
| — |
| — |
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
| (1,100,000) |
| (1,246,237) |
| — |
| (1,299) |
| — |
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
There is an economic relationship between the hedged item and the hedge instrument, since the terms of the interest rate and foreign exchange swap correspond to the terms of the fixed rate loan, that is, notional amount, term and payment. The Company established a 1:1 hedge ratio for hedge relationships, since the underlying risk of the interest rate and exchange rate swap is identical to the hedged risk component. To test the effectiveness of the hedge, the Company uses the discounted cash flow method and compares the changes in the fair value of the hedge instrument with the changes in the fair value of the hedged item attributable to the hedged risk.
5.11 Recognized fair value measurements
The market value of the Senior Notes are listed on the Luxembourg Stock Exchange (Note 5.6) is based on their quoted market price are as follows:
|
| Company |
| March 31, 2021 |
| December 31, 2020 |
Senior notes 2023 |
| Cosan Luxembourg |
| 100.16% |
| 101.02% |
Senior notes 2025 |
| Rumo Luxembourg |
| 105.43% |
| 104.96% |
Senior notes 2028 |
| Rumo Luxembourg |
| 105.07% |
| 105.04% |
Senior notes 2027 |
| Cosan Luxembourg |
| 106.57% |
| 108.20% |
Senior notes 2029 |
| Cosan S.A. |
| 106.01% |
| 103.47% |
Perpetual notes |
| Cosan Overseas Limited |
| 102.79% |
| 102.88% |
All the resulting fair value estimates are included in level 2.
The carrying amounts and fair value of financial assets and financial liabilities are as follows:
|
|
| Carrying amount |
| Assets and liabilities measured at fair value | ||||||||
|
|
| March 31, 2021 |
| December 31, 2020 |
| March 31, 2021 |
| December 31, 2020 | ||||
| Note |
|
|
|
|
| Level 1 |
| Level 2 |
| Level 1 |
| Level 2 |
Assets |
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment funds | 5.1 |
| 1,509,462 |
| 2,154,257 |
| — |
| 1,509,462 |
| — |
| 2,154,257 |
Marketable securities | 5.2 |
| 3,735,659 |
| 2,271,570 |
| — |
| 3,735,659 |
| — |
| 2,271,570 |
Other financial assets | 5.4 |
| 69,381 |
| 848,821 |
| 69,381 |
| — |
| 848,821 |
| — |
Derivate financial instruments | 5.10 |
| 6,232,605 |
| 3,127,418 |
| — |
| 6,232,605 |
| — |
| 3,127,418 |
Total |
|
| 11,547,107 |
| 8,402,066 |
| 69,381 |
| 11,477,726 |
| 848,821 |
| 7,553,245 |
Liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
|
Loans, borrowings and debentures | 5.6 |
| (19,351,831) |
| (6,837,028) |
| — |
| (19,351,831) |
| — |
| (6,837,028) |
Consideration payable |
|
| (218,115) |
| (224,787) |
| — |
| (218,115) |
| — |
| (224,787) |
Derivative financial instruments | 5.10 |
| (340,469) |
| (417,827) |
| — |
| (340,469) |
| — |
| (417,827) |
Total |
|
| (19,910,415) |
| (7,479,642) |
| — |
| (19,910,415) |
| — |
| (7,479,642) |
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
5.12 Financial risk management
This note explains the Company’s exposure to financial risks and how these risks could affect the group’s future financial performance. Current period profit and loss information has been included where relevant to add further context.
Risk | Exposure arising from | Measurement | Management |
Market risk – foreign exchange | (i) Future commercial transactions. (ii) Recognized financial assets and liabilities not denominated in Brazilian reais. | (i) Cash flow forecasting (ii) Sensitivity analysis | Foreign currency forwards. |
Market risk – interest rate | Cash and cash equivalents, marketable securities, loans, borrowings and debentures, leases and derivative. | (i) Sensitivity analysis | Interest rate Swap. |
Credit risk | Cash and cash equivalents, marketable securities trade receivables, derivatives, receivables from related parties and dividends. | (i) Ageing analysis (ii) Credit ratings | Diversification of bank deposits, credit limits and letters of credit. |
Liquidity risk | Loans, borrowings and debentures, trade payables, other financial liabilities, REFIS, leases, derivative, payables to related parties and dividends. | (i) Rolling cash flow forecasts | Availability of committed credit lines and borrowing facilities. |
The Company’s risk management is predominantly controlled by a central treasury department under policies approved by the Board of Directors. The Company’s Management identifies, evaluates and hedges financial risks in close co-operation with the Company’s operating units. The Board provides written principles for overall risk management, as well as policies covering specific areas, such as foreign exchange risk, interest rate risk, credit risk, use of derivative financial instruments and non-derivative financial instruments, and investment of excess liquidity.
Where all relevant criteria are met, hedge accounting is applied to remove the accounting mismatch between the hedging instrument and the hedged item. This will effectively result in recognizing interest expense at a fixed interest rate for the hedged floating rate loans and inventory at the fixed foreign currency rate for the hedged purchases.
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
The Company may choose to formally designate new debt transactions involving hedging derivative financial instruments through swap between exchange variation and interest rates, as measured at fair value. The fair value option is intended to eliminate or reduce any inconsistency in measurement or recognition of certain liabilities, which would otherwise arise. Thus, both the swaps and the respective debts are measured at fair value and this option is irrevocable and should be made only upon initial recording (“inception”) of the operation.
The Company’s policy is to maintain capital base to promote the confidence of investors, creditors and the market, and to ensure the future development of the business. Management monitors that the return on capital is adequate for each of its businesses.
The usage of financial instruments in order to protect against these areas of volatility is determined through an analysis of the risk exposure that management intends to cover.
a) Market risk
The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimizing the return.
- Foreign exchange risk
At March 31, 2021 and December 31, 2020, the Company had the following net exposure to the exchange rate variations on assets and liabilities denominated in U.S. Dollar (U.S.$.) and Euro:
| March 31, 2021 |
| December 31, 2020 |
Cash and cash equivalents | 1,271,634 |
| 143,676 |
Trade receivables | 81,750 |
| 17,502 |
Trade payables | (97,488) |
| (174,178) |
Loans, borrowings and debentures | (19,579,128) |
| (8,007,493) |
Consideration payable | (218,115) |
| (224,787) |
Derivative financial instruments (notional) | 16,775,697 |
| 5,453,252 |
Foreign exchange exposure, net | (1,765,650) |
| (2,792,028) |
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
The sensitivity of profit or loss to changes in the exchange rates arises mainly from U.S. Dollar denominated financial instruments and the impact on other components of equity arises from foreign forward exchange contracts designated as cash flow hedges though its joint ventures.
A reasonably possible strengthening (weakening) of the Real against the US dollars and Euro as of March 31, 2021 would have affected the measurement of foreign currency-denominated financial instruments and the affected shareholders' equity and income by the amounts indicated below:
|
|
|
|
|
| Variation scenario | ||||||
Instrument |
| Risk factor |
| Probable |
| 25% |
| 50% |
| -25% |
| -50% |
Cash and cash equivalents |
| Currency fluctuation |
| (160,033) |
| 766,053 |
| 1,647,756 |
| (997,354) |
| (1,879,057) |
Trade receivables |
| Currency fluctuation |
| 69,593 |
| 52,195 |
| 34,797 |
| 86,991 |
| 104,389 |
Trade payables |
| Currency fluctuation |
| (82,988) |
| (62,241) |
| (41,494) |
| (103,735) |
| (124,482) |
Derivative financial instruments |
| Currency fluctuation |
| 2,067,352 |
| 4,978,825 |
| 7,746,682 |
| (556,889) |
| (3,324,746) |
Loans, borrowings and debentures |
| Currency fluctuation |
| 949,259 |
| (4,427,509) |
| (9,804,277) |
| 6,326,026 |
| 11,702,794 |
Consideration payable |
| Currency fluctuation |
| 185,677 |
| 139,258 |
| 92,838 |
| 232,096 |
| 278,516 |
Impacts on profit or loss |
|
|
| 3,028,860 |
| 1,446,581 |
| (323,698) |
| 4,987,135 |
| 6,757,414 |
The probable scenario was defined based on the U.S dollar and Euro market rates projected for December 31, 2021, which determines the fair value of the derivatives at that date. Stressed scenarios (positive and negative effects, before taxes) were defined based on adverse impacts of 25% and 50% on the US dollar exchange rates used in the probable scenario.
Based on the financial instruments denominated in U.S. Dollars at March 31, 2021, the Company performed a sensitivity analysis with a 25% and 50% increase in the exchange rate (R$/ US$). The probable scenario considers the Company's projections made by specialized advisory services for 12-month exchange rates, as follows:
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
|
| Exchange rate sensitivity analysis (R$/U.S.$) and (R$/Euro) | ||||||||||
|
| March 31, 2021 |
| Scenario | ||||||||
|
|
| Probable |
| 25% |
| 50% |
| -25% |
| -50% | |
U.S.$ |
| 5.6973 |
| 5.4500 |
| 6.8125 |
| 8.1750 |
| 4.0875 |
| 2.7250 |
Euro |
| 6.6915 |
| 6.5400 |
| 8.1750 |
| 9.8100 |
| 4.9050 |
| 3.2700 |
- Interest rate risk
The Company and its subsidiaries monitor the fluctuations in variable interest rates in connection with their borrowings and uses derivative instruments in order to minimize variable interest rate fluctuation risks.
A sensitivity analysis on the interest rates on loans and borrowings in compensation for the CDI investments with pre-tax increases and decreases of 25% and 50% is presented below:
|
|
|
| Variation scenario | ||||||
Exposure interest rate |
| Probable |
| 25% |
| 50% |
| -25% |
| -50% |
Cash and cash equivalents |
| 167,300 |
| 208,829 |
| 250,949 |
| 125,475 |
| 83,650 |
Marketable securities |
| 151,814 |
| 189,768 |
| 227,722 |
| 113,861 |
| 90,795 |
Derivative financial instruments |
| 2,031,505 |
| 1,741,123 |
| 1,289,932 |
| 2,787,483 |
| 3,398,214 |
Loans, borrowings and debentures |
| (303,772) |
| (370,598) |
| (437,257) |
| (237,280) |
| (170,622) |
Impacts on profit or loss |
| 2,046,847 |
| 1,769,122 |
| 1,331,346 |
| 2,789,539 |
| 3,402,037 |
The probable scenario considers the estimated interest rate, made by a specialized third party and Central Bank of Brazil (Banco Central do Brasil), or “BACEN,” as follows:
|
| Probable |
| 25% |
| 50% |
| -25% |
| -50% |
SELIC |
| 4.48% |
| 5.60% |
| 6.73% |
| 3.36% |
| 2.24% |
CDI |
| 4.48% |
| 5.60% |
| 6.73% |
| 3.36% |
| 2.24% |
TJLP462 (TJLP + 1% p.y.) |
| 5.90% |
| 7.13% |
| 8.35% |
| 4.68% |
| 3.45% |
TJLP |
| 4.90% |
| 6.13% |
| 7.35% |
| 3.68% |
| 2.45% |
IPCA |
| 3.48% |
| 4.35% |
| 5.22% |
| 2.61% |
| 1.74% |
IGPM |
| 5.72% |
| 7.15% |
| 8.57% |
| 4.29% |
| 2.86% |
Libor |
| 0.41% |
| 0.51% |
| 0.62% |
| 0.31% |
| 0.21% |
Fed Funds |
| 0.15% |
| 0.19% |
| 0.23% |
| 0.11% |
| 0.08% |
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
b) Credit risk
The Company’s regular operations expose it to potential defaults when customers, suppliers and counterparties are unable to comply with their financial or other commitments. The Company seeks to mitigate this risk by entering into transactions with a diverse pool of counterparties. However, the Company continues to remain subject to unexpected third-party financial failures that could disrupt its operations. The exposure to credit risk was as follows:
| March 31, 2021 |
| December 31, 2020 |
Cash and cash equivalents | 7,933,170 |
| 4,614,053 |
Trade receivables | 2,311,402 |
| 1,604,839 |
Marketable securities | 3,735,659 |
| 2,271,570 |
Restricted cash | 59,872 |
| — |
Derivative financial instruments | 6,232,605 |
| 3,127,418 |
Receivables from related parties | 377,466 |
| 271,766 |
Dividends receivable | 102,592 |
| 77,561 |
Restricted cash | 69,381 |
| 68,838 |
| 20,822,147 |
| 12,036,045 |
The Company is also exposed to risks in connection with its cash management activities and temporary investments.
Liquid assets are invested primarily in government security and other investments in Banks with a minimum grade of “A.” Credit risk from balances with banks and financial institutions is managed by the Company’s treasury department in accordance with the Company’s policy.
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
Investments of surplus funds are made only with approved counterparties and within credit limits assigned to each counterparty. Counterparty credit limits are reviewed on an annual basis and may be updated throughout the period. The limits are set to minimize the concentration of risks and therefore mitigate financial loss through potential counterparty’s failure to make payments. The credit risk on cash and cash equivalents, marketable securities, restricted cash and derivative financial instruments are determined by rating instruments widely accepted by the market and are arranged as follows:
| March 31, 2021 |
| December 31, 2020 |
AAA | 16,892,915 |
| 8,997,661 |
AA | 1,068,391 |
| 1,015,380 |
| 17,961,306 |
| 10,013,041 |
c) Liquidity risk
The Company’s approach to managing liquidity is to ensure, as far as possible, that it will have sufficient liquidity to meet its liabilities when they are due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Company’s reputation.
The financial liabilities of the Company sorted by due dates (based on undiscounted cash flows contracted) are as follows:
| March 31, 2021 |
| December 31, 2020 | ||||||||
| Up to 1 year |
| 1 - 2 years |
| 3 - 5 years |
| More than 5 years |
| Total |
| Total |
Loans, borrowings and debentures | (3,447,685) |
| (5,772,340) |
| (15,991,229) |
| (32,523,942) |
| (57,735,196) |
| (20,543,616) |
Trade payables | (2,309,971) |
| — |
| — |
| — |
| (2,309,971) |
| (1,875,192) |
Other financial liabilities | (509,656) |
| — |
| — |
| — |
| (509,656) |
| (149,293) |
Tax installments - REFIS | (5,767) |
| (3,836) |
| (2,590) |
| (182,308) |
| (194,501) |
| (193,353) |
Leases | (574,155) |
| (407,930) |
| (1,139,410) |
| (12,357,849) |
| (14,479,344) |
| (107,451) |
Lease and concession instalments | (52,401) |
| (205,087) |
| (617,436) |
| (358,174) |
| (1,233,098) |
| — |
Payables to related parties | (366,835) |
| — |
| — |
| — |
| (366,835) |
| (150,484) |
Dividends payable | (147,214) |
| — |
| — |
| — |
| (147,214) |
| (16,301) |
Derivative financial instruments | 353,260 |
| 441,072 |
| 1,457,116 |
| 4,686,379 |
| 6,937,827 |
| 4,087,083 |
| (7,060,424) |
| (5,948,121) |
| (16,293,549) |
| (40,735,894) |
| (70,037,988) |
| (18,948,607) |
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
6 Other tax receivables
|
| Parent Company |
| Consolidated | ||||
|
| March 31, 2021 |
| December 31, 2020 |
| March 31, 2021 |
| December 31, 2020 |
COFINS - Revenue tax |
| 26,976 |
| 26,952 |
| 539,495 |
| 322,500 |
ICMS - State VAT (i) |
| — |
| — |
| 767,559 |
| 159,299 |
ICMS CIAP - State VAT (ii) |
| — |
| — |
| 114,377 |
| 17,763 |
PIS - Revenue tax |
| 2,785 |
| 2,785 |
| 135,099 |
| 20,071 |
Credit installment |
| 42,231 |
| 42,138 |
| 42,231 |
| 42,138 |
Other |
| 1,184 |
| 1,165 |
| 54,953 |
| 39,933 |
|
| 73,176 |
| 73,040 |
| 1,653,714 |
| 601,704 |
|
|
|
|
|
|
|
|
|
Current |
| 35,525 |
| 35,507 |
| 675,385 |
| 434,480 |
Non-current |
| 37,651 |
| 37,533 |
| 978,329 |
| 167,224 |
(i) ICMS credit related to the purchase of inputs and diesel used in transportation incorporated into the balance due to the corporate reorganization, Note 1.2.
(ii) ICMS credit arising from acquisitions of property, plant and equipment incorporated into the balance due to the corporate reorganization, Note 1.2.
7 Inventories
|
| Consolidated | ||
|
| March 31, 2021 |
| December 31, 2020 |
Finished goods |
| 828,469 |
| 545,529 |
Raw material for construction process |
| 115,403 |
| 118,319 |
Warehouse and other |
| 18,103 |
| 22,052 |
|
| 961,975 |
| 685,900 |
The balances are presented net of the provision for obsolete inventories in the amount of R$37,482 on March 31, 2021 (R$17,449 on December 31, 2020).
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
8 Investments in associates
8.1 Investments in subsidiaries and associates
Cosan’s subsidiaries and associates are listed below:
| March 31, 2021 |
| December 31, 2020 |
Directly owned subsidiaries |
|
|
|
Compass Gás e Energia | 99.01% |
| 99.01% |
Cosan Lubes Investments Limited (CLI) | 70.00% |
| 70.00% |
Cosan Cayman II Limited | 100.00% |
| 100.00% |
Cosan Global Limited | 100.00% |
| 100.00% |
Cosan Investimentos e Participações S.A. | 100.00% |
| 100.00% |
Cosan Luxembourg S.A. (ii) | 100.00% |
| 100.00% |
Cosan Overseas Limited | 100.00% |
| 100.00% |
Pasadena Empreendimentos e Participações S.A. | 100.00% |
| 100.00% |
Payly Soluções de Pagamentos S.A. | 75.00% |
| 75.00% |
Cosan Limited Partners Brasil Consultoria Ltda (i) | 60.00% |
| — |
Sinlog Tecnologia em Logística S.A. (i) | 78.43% |
| — |
Rumo S.A. | 30.37% |
| 2.16% |
Cosan Logística S.A. | — |
| 0.10% |
|
|
|
|
Interest of Compass Gás e Energia in its subsidiaries |
|
|
|
Companhia de Gás de São Paulo - Comgás | 99.15% |
| 99.15% |
Compass Comercialização S.A. | 100.00% |
| 100.00% |
Compass Geração Ltda | 100.00% |
| 100.00% |
Compass Energia Ltda | 100.00% |
| 100.00% |
Terminal de Regaseificação de São Paulo - TRSP | 100.00% |
| 100.00% |
Rota 4 Participações S.A. | 100.00% |
| 100.00% |
Edge II - Empresa de Geração de Energia | 100.00% |
| — |
|
|
|
|
Interest of Cosan Lubes Investments Limited in its subsidiaries |
|
|
|
Moove Lubricants Limited | 100.00% |
| 100.00% |
Cosan Cinco S.A. | 100.00% |
| 100.00% |
Airport Energy Limited | 100.00% |
| 100.00% |
Airport Energy Services Limited | 100.00% |
| 100.00% |
Wessesx Petroleum Limited | 100.00% |
| 100.00% |
Stanbridge Group Limited | 100.00% |
| 100.00% |
Cosan Lubricants España S.L.U. | 100.00% |
| 100.00% |
Techniques ET Technologies Appliquees SAS | 75.00% |
| 75.00% |
Cosan Lubrificantes S.R.L. | 98.00% |
| 98.00% |
Lubrigrupo II - Comércio e Distribuição | 100.00% |
| 100.00% |
de Lubrificantes SA | 100.00% |
| 100.00% |
Comma Oil & Chemicals Marketing SRL | 100.00% |
| 100.00% |
Comma Otomotiv Yag Ve Kimyasallari | 100.00% |
| 100.00% |
Pazarlama Limited Sirketi | 100.00% |
| 100.00% |
Comma Oil & Chemicals Marketing B | 100.00% |
| 100.00% |
Commercial Lubricants Moove Corp | 100.00% |
| 100.00% |
Cosan Lubrificantes e Especialidades S.A. | 100.00% |
| 100.00% |
Cosan US, Inc | 100.00% |
| 100.00% |
Ilha Terminal Distribuição de Produtos Derivados de Petróleo Ltda. | 100.00% |
| 100.00% |
Zip Lube S.A. | 100.00% |
| 100.00% |
Cosan Paraguay S.A. | 100.00% |
| 100.00% |
|
|
|
|
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
Interest of Rumo S.A. Investments Limited in its subsidiaries (i) |
|
|
|
Elevações Portuárias S.A. | 100.00% |
| — |
Rumo Intermodal S.A. | 100.00% |
| — |
Rumo Malha Central S.A. | 100.00% |
| — |
Boswells S.A. | 100.00% |
| — |
Rumo Malha Sul S.A. | 100.00% |
| — |
Rumo Luxembourg Sarl | 100.00% |
| — |
Rumo Malha Paulista S.A. | 100.00% |
| — |
ALL Armazéns Gerais Ltda. | 100.00% |
| — |
Rumo Malha Oeste S.A. | 100.00% |
| — |
Paranaguá S.A. | 99.90% |
| — |
Rumo Malha Norte S.A. | 99.74% |
| — |
ALL Argentina S.A. | 90.96% |
| — |
Brado Participações S.A. | 62.22% |
| — |
Logispot Armazéns Gerais S.A. | 51.00% |
| — |
Terminal São Simão S.A. | 51.00% |
| — |
(i) | Movement of equity interest resulting from the corporate reorganization as specified in note 1.2. | |
(ii) | Management concluded that there are no material uncertainties that put the subsidiaries operational continuity in doubt. Despite presenting on March 31, 2021 a combined investment amount with an unsecured liability of R$331,040, as shown below, no events or conditions were identified that, individually or collectively, could raise significant doubts as to the ability to maintain their continuity operational. The subsidiaries have the financial support of the Company. |
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
Below are investments in subsidiaries and associates that are material for the Company on March 31.2021:
a) Parent company
|
| Shares issued by the associate |
| Shares held by Cosan |
| Cosan ownership interest |
| Economic benefit (%) |
Compass Gás e Energia |
| 628,487,690 |
| 622,265,040 |
| 99.01% |
| 99.01% |
Cosan Global Limited |
| 1 |
| 1 |
| 100.00% |
| 100.00% |
Cosan Investimentos e Participações S.A. |
| 3,778,868,643 |
| 3,778,868,643 |
| 100.00% |
| 100.00% |
Cosan Luxemburgo S.A. |
| 500,000 |
| 500,000 |
| 100.00% |
| 100.00% |
Radar II Propriedades Agrícolas S.A. |
| 81,440,221 |
| 24,920,708 |
| 51.00% |
| 3.00% |
Radar Propriedades Agrícolas S.A. |
| 1,735,703 |
| 531,125 |
| 51.00% |
| 2.51% |
Tellus Brasil Participações S.A. |
| 120,920,492 |
| 61,359,624 |
| 50.74% |
| 5.00% |
Janus Brasil Participações S.A. |
| 207,712,545 |
| 105,461,644 |
| 50.77% |
| 5.00% |
Cosan Lubes Investment |
| 34,963,764 |
| 24,474,635 |
| 70.00% |
| 70.00% |
Payly Soluções de Pagamentos S.A. |
| 71,527,201 |
| 53,646,401 |
| 75.00% |
| 75.00% |
Pasadena Empreendimentos e Participações S.A. |
| 32,752,251 |
| 32,751,751 |
| 99.99% |
| 99.99% |
Sinlog Tecnologia em Logística S.A. |
| 51,000 |
| 40,000 |
| 78.43% |
| 78.43% |
Rumo S.A. |
| 1,854,158,791 |
| 562,529,490 |
| 30.34% |
| 30.37% |
Cosan Limited Partners Brasil Consultoria Ltda |
| 10 |
| 6 |
| 60.00% |
| 60.00% |
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
|
| At January 1, 2021 |
| Interest in earnings of subsidiaries |
| Sales or purchase of interests |
| Other comprehensive income |
| Dividends |
| Increase of capital |
| Merged net assets |
| Other |
| At March 31, 2021 |
Rumo S.A. |
| — |
| 17,067 |
| 1,740 |
| 708 |
| — |
| — |
| 4,585,932 |
| (9,037) |
| 4,596,410 |
Cosan Global |
| 132,896 |
| 10,867 |
| — |
| — |
| — |
| — |
| — |
| — |
| 143,763 |
Compass Gás e Energia |
| 3,288,317 |
| 462,395 |
| — |
| 1,734 |
| (198,020) |
| — |
| — |
| (80) |
| 3,554,346 |
Cosan Investimentos e Participações S.A. |
| 5,836,793 |
| 291,365 |
| — |
| (75,726) |
| — |
| — |
| — |
| — |
| 6,052,432 |
Cosan Limited Partners Brasil Consultoria Ltda |
| — |
| — |
| — |
| — |
| — |
| — |
| 430 |
| — |
| 430 |
Sinlog Tecnologia em Logística S.A. |
| — |
| (1,014) |
| 4,009 |
| — |
| — |
| 6,675 |
| 9,372 |
| — |
| 19,042 |
Cosan Lubes Investment |
| 1,364,608 |
| 46,434 |
| — |
| 59,478 |
| — |
| — |
| — |
| — |
| 1,470,520 |
Payly Soluções de Pagamentos S.A. |
| 9,071 |
| (401) |
| — |
| — |
| — |
| 5,250 |
| — |
| — |
| 13,920 |
Radar II Propriedades Agrícolas S.A. |
| 33,209 |
| 241 |
| — |
| 23 |
| — |
| — |
| — |
| — |
| 33,473 |
Radar Propriedades Agrícolas S.A. |
| 62,391 |
| 368 |
| — |
| 116 |
| — |
| — |
| — |
| — |
| 62,875 |
Tellus Brasil Participações S.A. |
| 105,662 |
| 1,127 |
| — |
| — |
| — |
| — |
| — |
| — |
| 106,789 |
Pasadena Empreendimentos e Participações S.A. |
| 473 |
| (19) |
| — |
| — |
| — |
| — |
| — |
| — |
| 454 |
Janus Brasil Participações S.A. |
| 130,900 |
| (3,157) |
| — |
| — |
| — |
| — |
| — |
| — |
| 127,743 |
Outros |
| 62,260 |
| 1,269 |
| — |
| 5,118 |
| — |
| — |
| — |
| (6) |
| 68,641 |
Total investments in associates |
| 11,026,580 |
| 826,542 |
| 5,749 |
| (8,549) |
| (198,020) |
| 11,925 |
| 4,595,734 |
| (9,123) |
| 16,250,838 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cosan Luxemburg S.A. |
| (458,852) |
| 127,811 |
| — |
| — |
| — |
| — |
| — |
| — |
| (331,041) |
Total provision for uncovered liability of associates |
| (458,852) |
| 127,811 |
| — |
| — |
| — |
| — |
| — |
| — |
| (331,041) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
| 10,567,728 |
| 954,353 |
| 5,749 |
| (8,549) |
| (198,020) |
| 11,925 |
| 4,595,734 |
| (9,123) |
| 15,919,797 |
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
a) Consolidated
|
| Shares issued by the associate |
| Shares held by Cosan |
| Cosan ownership interest |
| Economic benefit (%) |
Radar II Propriedades Agrícolas S.A. |
| 81,440,222 |
| 24,920,708 |
| 51.00% |
| 3.00% |
Radar Propriedades Agrícolas S.A. |
| 1,735,703 |
| 531,125 |
| 51.00% |
| 2.51% |
Tellus Brasil Participações S.A. |
| 120,920,492 |
| 61,359,624 |
| 50.74% |
| 5.00% |
Janus Brasil Participações S.A. |
| 136,928,272 |
| 69,361,678 |
| 50.77% |
| 5.00% |
(i) The Company has no significant influence, justifying the criteria to define the measurement of the retained portion of the investment using the equity method, although it does not consolidate due to the shareholders' agreement that inhibits its decision making.
|
| At January 1, 2021 |
| Interest in earnings of subsidiaries |
| Other comprehensive income |
| Merged net assets |
| Other |
| At March 31, 2021 |
|
Tellus Brasil Participações S.A. |
| 105,665 |
| 1,127 |
| — |
| — |
| — |
| 106,792 |
|
Janus Brasil Participações S.A. |
| 130,901 |
| (3,157) |
| — |
| — |
| — |
| 127,744 |
|
Radar Propriedades Agrícolas S.A |
| 62,372 |
| 368 |
| 116 |
| — |
| — |
| 62,856 |
|
Radar II Propriedades Agrícolas S.A |
| 33,205 |
| 241 |
| 23 |
| — |
| — |
| 33,469 |
|
Other |
| 1,562 |
| 227 |
| 24 |
| 49,953 |
| 13 |
| 51,779 |
|
|
| 333,705 |
| (1,194) |
| 163 |
| 49,953 |
| 13 |
| 382,640 |
|
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
8.2 Non-controlling interests in subsidiaries
Set out below is summarized financial information for each subsidiary that has non-controlling interests that are material to the group. The amounts disclosed for each subsidiary are before inter-company elimination.
| Shares issued by the subsidiary |
| Shares held by non-controlling shareholders |
| Non-controlling interest |
Compass Gás e Energia | 628,487,690 |
| 6,222,650 |
| 0.99% |
Comgás | 132,520,587 |
| 1,139,210 |
| 0.86% |
Cosan Lubes | 34,963,764 |
| 10,489,129 |
| 30.00% |
Payly Soluções de Pagamentos S.A. | 44,861,170 |
| 11,215,293 |
| 25.00% |
Rumo S.A. | 1,854,158,791 |
| 1,291,629,301 |
| 69.63% |
Cosan Limited Partners Brasil Consultoria Ltda | 10 |
| 4 |
| 40.00% |
Sinlog Tecnologia em Logística S.A. | 51,000 |
| 10,000 |
| 21.57% |
TTA | 10,521 |
| 2,630 |
| 25.00% |
The following table summarizes the information relating to each of the Company’s subsidiaries that has material non-controlling interests, before any intra-group elimination.
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
| At January 1, 2021 |
| Interest in earnings of subsidiaries |
| Sales or purchase of interests |
| Other comprehensive income |
| Dividends |
| Capital increase |
| Merged net assets |
| Other |
| At March 31, 2021 |
|
Comgás | 24,729 |
| 4,116 |
| — |
| — |
| (1,290) |
| — |
| — |
| 6 |
| 27,561 |
|
Compass Gás e Energia | 32,880 |
| 4,624 |
| — |
| — |
| (1,981) |
| — |
| — |
| 17 |
| 35,540 |
|
Rumo S.A. | — |
| 40,747 |
| (22,455) |
| 720 |
| (136) |
| — |
| 10,831,203 |
| 941 |
| 10,851,020 |
|
Sinlog Tecnologia em Logística S.A. | — |
| (279) |
| 873 |
| — |
| — |
| — |
| 4,643 |
| — |
| 5,237 |
|
Cosan Limited Partners Brasil Consultoria Ltda | — |
| (58) |
| — |
| — |
| — |
| — |
| 287 |
| — |
| 229 |
|
Cosan Lubes | 582,283 |
| 19,901 |
| — |
| 25,490 |
| — |
| — |
| — |
| — |
| 627,674 |
|
TTA | 15,834 |
| 538 |
| — |
| 786 |
| — |
| — |
| — |
| — |
| 17,158 |
|
Payly | 2,423 |
| (133) |
| — |
| — |
| — |
| 1,750 |
| — |
| — |
| 4,040 |
|
| 658,149 |
| 69,456 |
| (21,582) |
| 26,996 |
| (3,407) |
| 1,750 |
| 10,836,133 |
| 964 |
| 11,568,459 |
|
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
9 Investments in joint ventures
Changes to investments in joint ventures were as follows:
| Raízen Combustíveis S.A. |
| Raízen Energia S.A. |
| Total |
Shares issued by the joint venture | 1,661,418,472 |
| 7,243,283,198 |
|
|
Shares held by Cosan | 830,709,236 |
| 3,621,641,599 |
|
|
Cosan ownership interest | 50% |
| 50% |
|
|
|
|
|
|
|
|
At January 1, 2021 | 3,847,506 |
| 4,140,702 |
| 7,988,208 |
Interest in earnings of joint ventures | 164,754 |
| 90,047 |
| 254,801 |
Other comprehensive (losses) income | (614,489) |
| 538,763 |
| (75,726) |
Interest on capital (i) | (19,221) |
| — |
| (19,221) |
Dividends (i) | — |
| (2,498) |
| (2,498) |
At March 31, 2021 | 3,378,550 |
| 4,767,014 |
| 8,145,564 |
(i) Amount proposed but not paid in the period.
According to the terms of the jointly-controlled subsidiary - Raizen, the subsidiary Cosan is responsible for certain legal proceedings that existed before the formation of Raizen, net of judicial deposits on April 1, 2011, as well as tax installments under the terms of the tax amnesty and Refinancing program recorded in “Other taxes payable”. In addition, Cosan granted Raizen access to a credit line (stand-by) in the amount of US$ 350,000 thousand, unused on March 31, 2021.
The statement of financial position and statement of profit or loss of the joint ventures are disclosed in Note 4 – Segment information.
As of March 31, 2021, the Company was in compliance with the covenants of the contracts that govern the respective joint ventures.
1
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
10 Property, plant and equipment, intangible assets, goodwill and contract asset
10.1 Property, plant and equipment
a) Reconciliation of carrying amount
| Consolidated |
| Parent Company | ||||||||||||
| Land, buildings and improvements |
| Machinery, equipment and facilities |
| Railcars and locomotives (i) | (iii) |
| Permanent easement (iii) |
| Construction in progress |
| Other |
| Total |
| Total |
Cost |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At December 31, 2020 | 262,442 |
| 289,852 |
| — |
| — |
| 53,423 |
| 135,851 |
| 741,568 |
| 81,529 |
Corporate reorganization (Note 1.2) | 1,357,217 |
| 1,152,944 |
| 6,720,454 |
| 7,530,328 |
| 3,146,532 |
| 374,622 |
| 20,282,097 |
| 4,073 |
Additions | 90 |
| 354 |
| 67 |
| 2,284 |
| 340,511 |
| 26 |
| 343,332 |
| 65 |
Disposals | — |
| — |
| (236) |
| — |
| — |
| — |
| (236) |
| — |
Transfers (ii) | 36,081 |
| 17,605 |
| 372,811 |
| 297,962 |
| (751,661) |
| 6,107 |
| (21,095) |
| — |
Effect of exchange rate fluctuations | 8,677 |
| 13,219 |
| — |
| — |
| 320 |
| 8,731 |
| 30,947 |
| — |
At March 31, 2021 | 1,664,507 |
| 1,473,974 |
| 7,093,096 |
| 7,830,574 |
| 2,789,125 |
| 525,337 |
| 21,376,613 |
| 85,667 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Depreciation |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At December 31, 2020 | (101,956) |
| (162,437) |
| — |
| — |
| — |
| (60,179) |
| (324,572) |
| (20,070) |
Corporate reorganization (Note 1.2) | (415,398) |
| (579,129) |
| (2,561,600) |
| (2,647,648) |
| (13,379) |
| (27,699) |
| (6,244,853) |
| (1,349) |
Additions | (7,109) |
| (20,401) |
| (37,488) |
| (43,549) |
| (594) |
| (3,172) |
| (112,313) |
| (1,526) |
Disposals | — |
| — |
| 429 |
| — |
| — |
| — |
| 429 |
| — |
Transfers (ii) | (17,300) |
| — |
| (26) |
| 17,293 |
| 7 |
| (12) |
| (38) |
| — |
Effect of exchange rate fluctuations | (3,939) |
| (7,299) |
| — |
| — |
| — |
| (3,800) |
| (15,038) |
| — |
At March 31, 2021 | (545,702) |
| (769,266) |
| (2,598,685) |
| (2,673,904) |
| (13,966) |
| (94,862) |
| (6,696,385) |
| (22,945) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At December 31, 2020 | 160,486 |
| 127,415 |
| — |
| — |
| 53,423 |
| 75,672 |
| 416,996 |
| 61,459 |
At March 31, 2021 | 1,118,805 |
| 704,708 |
| 4,494,411 |
| 5,156,670 |
| 2,775,159 |
| 430,475 |
| 14,680,228 |
| 62,722 |
(i) | On March 31, 2021, wagons and locomotives in the amount of R$745,203 were pledged to guarantee bank loans (Note 5.6). | |
(ii) | They are substantially transferring from property, plant and equipment under construction as a result of the capitalization of reffered assets. | |
(iii) | Depreciation is calculated on a straight-line basis over the estimated useful lives of the assets, for railcars from 2.9% to 6%, locomotives from 3.3% to 8% and permanent easement from 3% to 4%. |
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
10.2 Intangible assets and goodwill
| Consolidated |
| Parent Company | ||||||||||||
| Goodwill |
| Concession rights |
| Operating license |
| Trademarks |
| Customer relationships |
| Other |
| Total |
| Total |
Cost |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At December 31, 2020 | 977,307 |
| 10,758,762 |
| — |
| 63,408 |
| 1,029,212 |
| 311,562 |
| 13,140,251 |
| 15,462 |
Corporate reorganization (Note 1.2) | 111,413 |
| 8,017,957 |
| 343,348 |
| — |
| — |
| 235,724 |
| 8,708,442 |
| — |
Additions | 4,884 |
| — |
| — |
| — |
| 49,657 |
| 796 |
| 55,337 |
| 49 |
Disposals (ii) | — |
| (147,834) |
| — |
| — |
| (29) |
| — |
| (147,863) |
| — |
Transfers (i) | — |
| 335,122 |
| — |
| — |
| 395,166 |
| (67,578) |
| 662,710 |
| 9 |
Effect of exchange rate fluctuations | 30,688 |
| — |
| — |
| 5,787 |
| 27,847 |
| 1,075 |
| 65,397 |
| — |
At March 31, 2021 | 1,124,292 |
| 18,964,007 |
| 343,348 |
| 69,195 |
| 1,501,853 |
| 481,579 |
| 22,484,274 |
| 15,520 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amortization: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At December 31, 2020 | — |
| (2,333,680) |
| — |
| (9,201) |
| (509,297) |
| (242,777) |
| (3,094,955) |
| (13,271) |
Corporate reorganization (Note 1.2) | — |
| (1,144,572) |
| (157,411) |
| — |
| — |
| (164,684) |
| (1,466,667) |
| — |
Additions | — |
| (121,559) |
| (997) |
| — |
| (25,631) |
| (8,200) |
| (156,387) |
| (37) |
Disposals (ii) | — |
| 144,868 |
| — |
| — |
| 27 |
| — |
| 144,895 |
| (190) |
Transfers | — |
| (37,037) |
| — |
| — |
| (395,203) |
| 37,035 |
| (395,205) |
| — |
Effect of exchange rate fluctuations | — |
| — |
| — |
| — |
| (9,003) |
| (3,783) |
| (12,786) |
| — |
At March 31, 2021 | — |
| (3,491,980) |
| (158,408) |
| (9,201) |
| (939,107) |
| (382,409) |
| (4,981,105) |
| (13,498) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At December 31, 2020 | 977,307 |
| 8,425,082 |
| — |
| 54,207 |
| 519,915 |
| 68,785 |
| 10,045,296 |
| 2,191 |
At March 31, 2021 | 1,124,292 |
| 15,472,027 |
| 184,940 |
| 59,994 |
| 562,746 |
| 99,170 |
| 17,503,169 |
| 2,022 |
(i) Contract asset transfers, the amount also includes a portion of the intangible asset that was reclassified to the financial asset.
(ii) Includes the amount of R$142,316 related to the write-off of fully depreciated assets.
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
a) Capitalization of borrowing costs
Capitalized borrowing costs for the period ended March 31, 2021, R$25,026 was capitalized at an average rate of 6.96% p.a. (R$9,265 at an average rate of 7.55% p.y. at March 31, 2020).
b) Amortization methods and useful lives
Intangible assets (excluding goodwill) | Annual rate of amortization |
| March 31, 2021 |
| December 31, 2020 |
|
|
|
|
|
|
|
|
Comgás (i) | During the term of the concession and extension |
| 8,608,770 |
| 8,425,082 |
|
Rumo(ii) |
| 6,863,257 |
| — |
| |
|
|
| 15,472,027 |
| 8,425,082 |
|
|
|
|
|
|
|
|
Operating license for port terminal | 3.70% |
| 184,940 |
| — |
|
|
|
| 184,940 |
| — |
|
Trademarks |
|
|
|
|
|
|
Comma | Undefined |
| 59,994 |
| 54,207 |
|
|
|
| 59,994 |
| 54,207 |
|
Customers relationship |
|
|
|
|
|
|
Comgás | 20.00% |
| 239,771 |
| 210,038 |
|
Moove | 8.70% |
| 321,162 |
| 309,877 |
|
Other | 20.00% |
| 1,813 |
| — |
|
|
|
| 562,746 |
| 519,915 |
|
Other |
|
|
|
|
|
|
Software license | 20.00% |
| 18,076 |
| 18,478 |
|
Other |
|
| 81,094 |
| 50,307 |
|
|
|
| 99,170 |
| 68,785 |
|
|
|
|
|
|
|
|
Total |
|
| 16,378,877 |
| 9,067,989 |
|
(i) | Refers to the intangible asset for the public gas distribution service concession, which represents the right to charge users for the supply of gas, comprised of: (i) the concession rights recognized in the business combination and (ii) concession assets. | ||
(ii) | Refers to the concession contract of Rumo Malha Norte. The asset was identified and measured at fair value in the business combination between Rumo and ALL. The amount will be amortized until the end of the concession in 2079, being recorded in the income statement, under costs of services provided, in the depreciation and amortization group. |
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
10.3 Contract asset
| Comgás |
| Moove |
| Total |
Cost: |
|
|
|
|
|
At January 1, 2021 | 686,690 |
| 9,248 |
| 695,938 |
Additions | 174,925 |
| 8,959 |
| 183,884 |
Disposals | — |
| (5,748) |
| (5,748) |
Transfers to intangible assets | (271,981) |
| — |
| (271,981) |
At March 31, 2021 | 589,634 |
| 12,459 |
| 602,093 |
10.4 Right-of-use
Accounting policy:
The right-to-use asset is initially measured at cost, which comprises the initial measurement value of the lease liability, adjusted for any lease payments made up to that of the start date, plus any initial direct costs incurred by the lessee and an estimate of costs to be incurred by the lessee in disassembling and removing the underlying asset, restoring the location in which it is located or restoring the underlying asset to the condition required by the lease terms and conditions, less any lease incentives received.
The right-of-use asset is subsequently depreciated using the straight-line method from the start date to the end of the lease term, unless the lease transfers ownership of the underlying asset to the lessee at the end of the lease term, or if the cost of the right-of-use asset reflect that the lessee will exercise the call option. In this case, the right-of-use asset will be depreciated over the useful life of the underlying asset, which is determined on the same basis as that of property, plant and equipment. In addition, the right-of-use asset is periodically reduced by impairment losses, if any, and adjusted for certain remeasurements of the lease liability. |
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
| Consolidated |
| Parent Company | ||||||||||||
| Land, buildings and improvements |
| Machinery, equipment and facilities |
| Railcars and locomotives |
| Software |
| Vehicles |
| Port and rail infrastructure |
| Total |
| Total |
Cost: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At December 31, 2020 | 94,971 |
| 15,810 |
| — |
| — |
| — |
| — |
| 110,781 |
| 31,654 |
Corporate reorganization (Note 1.2) | 282,565 |
| 31,857 |
| 937,268 |
| 87,028 |
| 13,925 |
| 7,440,652 |
| 8,793,295 |
| 11,561 |
Additions | 410 |
| 6,121 |
| — |
| — |
| 13,188 |
| — |
| 19,719 |
| 209 |
Contractual adjustments | 45 |
| — |
| — |
| — |
| — |
| — |
| 45 |
| — |
Disposals | — |
| (1,304) |
| — |
| — |
| — |
| — |
| (1,304) |
| — |
Currency translation adjustments | 3,204 |
| 298 |
| — |
| — |
| — |
| — |
| 3,502 |
| — |
At March 31, 2021 | 381,195 |
| 52,782 |
| 937,268 |
| 87,028 |
| 27,113 |
| 7,440,652 |
| 8,926,038 |
| 43,424 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amortization: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At December 31, 2020 | (19,106) |
| (7,451) |
| — |
| — |
| — |
| — |
| (26,557) |
| (6,845) |
Corporate reorganization (Note 1.2) | (100,177) |
| (6,759) |
| (362,498) |
| (13,252) |
| (13,618) |
| (478,741) |
| (975,045) |
| (3,131) |
Additions | (7,078) |
| (2,108) |
| (8,821) |
| (371) |
| (19) |
| (21,657) |
| (40,054) |
| (988) |
Disposals | — |
| 1,480 |
| — |
| — |
| — |
| — |
| 1,480 |
| — |
Currency translation adjustments | (616) |
| 61 |
| — |
| — |
| — |
| — |
| (555) |
| — |
At March 31, 2021 | (126,977) |
| (14,777) |
| (371,319) |
| (13,623) |
| (13,637) |
| (500,398) |
| (1,040,731) |
| (10,964) |
|
|
|
|
|
|
| — |
|
|
|
|
|
|
|
|
At December 31, 2020 | 75,865 |
| 8,359 |
| — |
| — |
| — |
| — |
| 84,224 |
| 24,809 |
At March 31, 2021 | 254,218 |
| 38,005 |
| 565,949 |
| 73,405 |
| 13,476 |
| 6,940,254 |
| 7,885,307 |
| 32,460 |
11 Liabilities, provisions and commitments to the Granting Authority
The Company, through its subsidiaries, is a party to sub-concession and lease agreements with the Government. The main liabilities and provisions generated by the contracts are:
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
a) Lease and concession instalments and balances in dispute
Accounting policy:
The Company records in this account the balance of the lease installments involved in disputes with the granting authority. The initial registration occurs at the amount of the installment at maturity, by transferring the “Liabilities for leases” account. Subsequently, the values are corrected by Selic. Balances in installments with the Granting Authority are maintained in this account. The initial registration takes place at the amount that was left over from the resolution of the dispute. The amounts are corrected by Selic until payment. Balances payable as a concession for concession rights (“Concessions”) are also recorded in this account, initially recorded as a contra entry to intangible assets. Subsequent measurement occurs at the effective rate. |
| March 31, 2021 |
| December 31, 2020 |
Lease and concession in dispute: |
|
|
|
Rumo Malha Paulista S.A. | 102,323 |
| 101,871 |
Rumo Malha Oeste S.A. | 1,640,897 |
| 1,617,764 |
| 1,742,768 |
| 1,719,635 |
|
|
|
|
Installment leases: |
|
|
|
Rumo Malha Paulista S.A. | 1,160,073 |
| 1,154,919 |
| 1,160,073 |
| 1,154,919 |
|
|
|
|
Concessions: |
|
|
|
Rumo Malha Sul S.A. | 86,439 |
| 84,637 |
Rumo Malha Paulista S.A. | 25,752 |
| 24,151 |
| 112,191 |
| 108,788 |
|
|
|
|
Total | 3,015,484 |
| 2,983,342 |
|
|
|
|
Current | 159,745 |
| 158,705 |
Non-current | 2,855,739 |
| 2,824,637 |
| 3,015,484 |
| 2,983,342 |
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
Lease and concession under litigation:
Rumo Malha Oeste also pleads for the reestablishment of the economic and financial balance, lost due to the cancellation of transportation contracts existing at the time of privatization, configuring changes in the regulatory scenario and conditions established in the Privatization Notice - in addition, the growth forecasts that defined the business value did not materialize. The lawsuit is pending before the Federal Regional Court of the second Region. The amount referring to the Company’s overdue installments was guaranteed by the acquisition of public debt securities (Letras Financeiras do Tesouro) or “LFT.” In March 2008, the Company obtained authorization to replace the guarantee with bank guarantee and in May 2008 the Company redeemed the amounts. In December 2014, a decision was handed down that upheld the lawsuit, recognizing the occurrence of economic and financial imbalance in the contracts. In December 2015, a request for replacement of letters of guarantee presented by the Company with guarantee insurance was granted. An appeal judgment is pending before the Federal Regional Court (Tribunal Regional Federal), or “TRF.” Management, supported by the opinion of its lawyers, assesses the chances of success as probable, but maintains the record of the liability because it is a contractual obligation not yet withdrawn from the Company, and because the amount is still pending.
Also in the context of the disputes involving the Western Network, in January 2020, the National Land Transport Agency (ANTT) decided to initiate an Ordinary Administrative Process to generate a conclusive report as to the suitability, or not, of the declaration of expiry of the concession of the Malha Oeste by the Union. The analysis will be conducted by a commission to be appointed by the Infrastructure and Railroad Cargo Transport Services area. Management, supported by the opinion of its lawyers, assesses the risk of loss as possible.
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
On July 21, 2020, the Company filed with the ANTT, a request to qualify for a new bidding process to third parties of the object of the Concession Contract signed between Rumo Malha Oeste and the Brazilian government, through the Ministry of Transport (“Re-bidding Process”), according to Federal Law No. 13,448 of June 5, 2017, and regulated by Decree No. 9,957 of August 7, 2019.
Judicial deposits concerning the above claims totaled R$22,119.
Installment leases:
As a condition for entering the renewal amendment for Rumo Malha Paulista, there was a need for the Company to resolve the dispute involving the economic and financial rebalancing of the original contract. To this end, an agreement was signed between Rumo Malha Paulista, Brazilian Federal Government and ANTT, in which it was agreed: i) a credit in favor of the Company related to labor liens paid up to 2005; ii) the conversion of existing judicial deposits in favor of the Union; iii) an uncontroversial balance in favor of the Federal Government, divided into eight annual installments adjusted by Selic (balance transferred from the “Lease and concession under litigation” account to “Leased installments”); iv) a portion of liabilities to be offset against potential credits in favor of the Company, these credits, subject to the assessment to be carried out by a working group involving the parties (balance maintained in the “Lease and concession under litigation” account).
As a result of the agreement, suspensions of the proceedings for return lawsuits filed by Rumo against the Brazilian Federal Government were required to determine labor claims that were not part of the agreement (from 2005) and which will be the subject of an investigation to be carried out by working group involving the parties. In parallel, the parties will submit a request for judicial approval of the agreement in the records of the economic and financial rebalancing action of the contract.
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
Leases and grants under IFRS16 (Note 5.8)
| March 31, 2021 |
| December 31, 2020 |
Leases: |
|
|
|
Rumo Malha Sul S.A. | 588,094 |
| 600,745 |
Rumo Malha Paulista S.A. | 465,566 |
| 475,647 |
Rumo Malha Oeste S.A. | 221,679 |
| 179,568 |
Elevações Portuárias S.A. | 98,681 |
| 76,925 |
Portofer Ltda. | 11,935 |
| 12,463 |
| 1,385,955 |
| 1,345,348 |
|
|
|
|
Grants: |
|
|
|
Rumo Malha Paulista S.A. | 505,278 |
| 492,222 |
Malha Central S.A. | 504,375 |
| 491,354 |
| 1,009,653 |
| 983,576 |
|
|
|
|
Total | 2,395,608 |
| 2,328,924 |
|
|
|
|
Current | 239,256 |
| 232,212 |
Non-current | 2,156,352 |
| 2,096,712 |
| 2,395,608 |
| 2,328,924 |
b) Investment commitments
Sub-concession contracts to which the Company, through its subsidiaries, is a party, often includes commitments to execute investments with certain characteristics during the term of the contract. Can be highlighted:
The renewal addendum to the concession of Malha Paulista, which foresees the execution of a set of investment projects to increase capacity and reduce urban conflicts, estimated by the agency at R$6,100,000 (value updated until December 2017). Of this amount, around R$3,000,000 is included in the obligations, whose physical execution was 8%.
The Rumo Malha Central sub-concession contract provides for investments with a fixed term (one to three years from the signing of the contract), estimated by ANTT at R$645,573. As of December 31, 2021, the physical execution of obligation book projects was 58%.
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
The Elevações Portuárias concession and lease agreement provide for investments aimed at improving and modernizing the facilities and equipment allocated therein, estimated for R$340,000. At the balance sheet date, the subsidiary had made investments for R$270,629.
12 Other taxes payable
|
| Parent Company |
| Consolidated | ||||
|
| March 31, 2021 |
| December 31, 2020 |
| March 31, 2021 |
| December 31, 2020 |
REFIS - Tax amnesty and refinancing program |
| 193,108 |
| 193,352 |
| 201,885 |
| 199,587 |
ICMS – State VAT |
| — |
| — |
| 220,513 |
| 182,227 |
COFINS – Revenue tax |
| 30,195 |
| 44,428 |
| 56,889 |
| 62,801 |
PIS – Revenue tax |
| 10,167 |
| 12,581 |
| 15,539 |
| 16,264 |
INSS – Social security |
| 16,631 |
| 15,085 |
| 27,933 |
| 19,026 |
Withholding income tax |
| — |
| — |
| 15,126 |
| 5,915 |
Other |
| 554 |
| 1,155 |
| 38,178 |
| 28,151 |
|
| 250,655 |
| 266,601 |
| 576,063 |
| 513,971 |
|
|
|
|
|
|
|
|
|
Current |
| 109,828 |
| 125,368 |
| 427,666 |
| 367,076 |
Non-current |
| 140,827 |
| 141,233 |
| 148,397 |
| 146,895 |
|
| 250,655 |
| 266,601 |
| 576,063 |
| 513,971 |
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
13 Income tax and social contribution
a) Reconciliation of income and social contribution tax expenses
|
| Parent Company |
| Consolidated | ||||
|
| March 31, 2021 |
| March 31, 2020 |
| March 31, 2021 |
| March 31, 2020 |
|
|
|
|
|
|
|
|
|
Profit before taxes |
| 521,732 |
| (50,711) |
| 666,439 |
| 102,526 |
Income tax and social contribution nominal rate (34%) |
| (177,389) |
| 17,242 |
| (226,589) |
| (34,859) |
|
|
|
|
|
|
|
|
|
Adjustments to determine the effective rate |
|
|
|
|
|
|
|
|
Interest in earnings of investees (non-taxable income) |
| 305,802 |
| 139,882 |
| 86,226 |
| 65,336 |
Differences in tax rates on earnings (losses) of overseas companies |
| (3,401) |
| (4,523) |
| (19,899) |
| (22,163) |
Granted income tax incentive |
| — |
| — |
| 23,519 |
| — |
Share-based payment transactions |
| (37) |
| 859 |
| (37) |
| 859 |
Interest on shareholders’ equity |
| — |
| — |
| (6,535) |
| (6,460) |
Non-deductible expenses (donations, gifts, etc.) |
| — |
| — |
| (792) |
| 4,258 |
Tax losses not recorded |
| — |
| — |
| (21,205) |
| 796 |
ICMS benefit - extemporaneous tax credits (i) |
| — |
| — |
| 198,784 |
| — |
ICMS benefit - current period (ii) |
| — |
| — |
| 20,111 |
| — |
Other |
| (7,900) |
| (498) |
| (11,759) |
| 6,411 |
Income tax and social contribution (current and deferred) |
| 117,075 |
| 152,962 |
| 41,824 |
| 14,178 |
|
|
|
|
|
|
|
|
|
Effective rate - % |
| (22.44%) |
| 301.63% |
| (6.28%) |
| (13.83%) |
(i) | The indirect subsidiary Comgás recognized the extemporaneous credit in the amount of R$262,848 (R$198,784 principal and R$64,064 interest), used through their compensation with IR and CS payable overdue in the period, related to overpayments of Income Tax and Social Contribution for the years 2015 and 2016, when this benefit wasn't counted in the calculation of the IR and CS payable by the Company, due to the non-taxation of the benefit of the reduction of the ICMS calculation base in the State of São Paulo from 12% to 15.6% under art. 8 of Annex II of the ICMS Regulation, approved by State Decree No. 45,900 (“RICMS / SP”), with wording given by State Decree No. 62,399 / 2016. These credits were recognized by the Company based on its best understanding on the topic, substantiated by the opinion of its external legal advisors, which took into account all the jurisprudence applicable to the topic. The Company also took into account all the current accounting rules, which after being analyzed together, did not indicate any other accounting effect to be recognized. |
(ii) | The subsidiary Comgás after from January 1, 2021, the Company changed its tax procedure, starting to exclude the benefit of the reduction in the ICMS calculation base, granted by the State of São Paulo, directly from the calculation of income tax and social contribution for the period. |
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
b) Deferred income tax assets and liabilities
The tax effects of temporary differences that give rise to significant portions of the Company’s deferred tax assets and liabilities are presented below:
| Parent Company |
| Consolidated | ||||
| March 31, 2021 |
| December 31, 2020 |
| March 31, 2021 |
| December 31, 2020 |
Assets credit of: |
|
|
|
|
|
|
|
Income tax losses | 531,364 |
| 508,453 |
| 2,714,840 |
| 721,115 |
Social contribution losses | 191,825 |
| 183,576 |
| 979,490 |
| 250,209 |
|
|
|
|
|
|
|
|
Temporary differences |
|
|
|
|
|
|
|
Foreign exchange - Loans and borrowings | 1,560,357 |
| 1,312,239 |
| 1,954,994 |
| 1,367,496 |
Provision for legal proceedings | 65,729 |
| 64,407 |
| 300,057 |
| 91,535 |
Impairment provision | — |
| — |
| 217,975 |
| — |
Post-employment benefits | — |
| — |
| 203,975 |
| 200,461 |
Allowance for expected credit losses | — |
| — |
| 30,383 |
| 16,664 |
Tax credit losses | 6,985 |
| 6,985 |
| 83,808 |
| 38,684 |
Share-based payment transactions | — |
| — |
| 20,959 |
| 4,857 |
Profit sharing | 2,142 |
| 2,773 |
| 12,629 |
| 32,022 |
Interest on preferred shareholders payable in subsidiaries | 264,444 |
| 167,412 |
| 264,444 |
| 167,412 |
Review of useful life of property, plant and equipment | — |
| — |
| 391,611 |
| (230,098) |
Miscellaneous expense allowance | 200,114 |
| 202,120 |
| 352,293 |
| 270,198 |
Other (i) | — |
| — |
| 249,181 |
| 8,076 |
Total | 2,822,960 |
| 2,447,965 |
| 7,776,639 |
| 2,938,631 |
|
|
|
|
|
|
|
|
(-) Deferred taxes assets net not recognized (ii) | — |
| — |
| (2,362,250) |
| (21,133) |
|
|
|
|
|
|
|
|
Liabilities credit of: |
|
|
|
|
|
|
|
Temporary differences |
|
|
|
|
|
|
|
Business combination - property, plant and equipment | — |
| — |
| 11,117 |
| (37,547) |
Tax deductible goodwill | (21,823) |
| (21,823) |
| (392,399) |
| (365,949) |
Leases | — |
| — |
| 2,044 |
| (3,245) |
Unrealized gains on derivatives instruments | (966,482) |
| (790,888) |
| (1,703,186) |
| (836,629) |
Income on formation of joint ventures | (1,135,036) |
| (1,135,036) |
| (1,135,036) |
| (1,135,036) |
Business combination - Intangible assets | — |
| — |
| (3,605,952) |
| (1,054,417) |
Provision for realization - Goodwill recorded in equity | (449,153) |
| (449,153) |
| (449,153) |
| (449,153) |
Other | 1,125 |
| 2,967 |
| 327,594 |
| 322,861 |
Total | (2,571,369) |
| (2,393,933) |
| (6,944,971) | (3,559,115) | |
|
|
|
|
|
|
|
|
Total of deferred taxes recorded, net | 251,591 |
| 54,032 |
| (1,530,582) |
| (641,617) |
|
|
|
|
|
|
|
|
Deferred tax assets | 251,591 |
| 54,032 |
| 2,150,103 |
| 629,591 |
Deferred tax liabilities | — |
| — |
| (3,680,685) |
| (1,271,208) |
(i) | Refers mainly to pre-operating expenses added to Rumo Malha Central. |
(ii) | Refers mainly to tax losses and temporary differences of the Company, Rumo Malha Sul and Rumo Malha Oeste, which, under current conditions, do not meet the requirements for accounting for said income tax and social contribution assets deferred due to the lack of predictability of future generation of tax profits. |
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
c) Analytical movement in deferred tax assets and liabilities
| Parent Company | ||||||||
| Tax loss and negative basis |
| Employee benefits |
| Provisions |
| Other |
| Total |
Balance on December 31, 2020 | 692,029 |
| 2,773 |
| 273,512 |
| 1,479,651 |
| 2,447,965 |
Credited / (charged) to the profit for period | 31,160 |
| (631) |
| (684) |
| 97,032 |
| 126,877 |
Exchange differences | — |
| — |
| — |
| 248,118 |
| 248,118 |
Balance on March 31, 2021 | 723,189 |
| 2,142 |
| 272,828 |
| 1,824,801 |
| 2,822,960 |
| Parent Company | ||||||
| Effects on the formation of joint ventures |
| Unrealized income on derivatives |
| Other |
| Total |
Balance on December 31, 2020 | (1,135,036) |
| (790,888) |
| (468,009) |
| (2,393,933) |
(Charged) to the profit for period | — |
| (175,594) |
| (82,326) |
| (257,920) |
Recognized in equity | — |
| — |
| 80,484 |
| 80,484 |
Balance on March 31, 2021 | (1,135,036) |
| (966,482) |
| (469,851) |
| (2,571,369) |
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
| Consolidated |
| ||||||||||||
| Tax loss and negative basis |
| Employee benefits |
| Provisions |
| Post-employment obligations |
| Property, plant and equipment |
| Other |
| Total |
|
Balance on December 31, 2020 | 971,324 |
| 36,879 |
| 417,081 |
| 200,461 |
| (230,098) |
| 1,542,984 |
| 2,938,631 |
|
Corporate reorganization (Note 1.2) | 2,638,981 |
| 29,389 |
| 584,013 |
| — |
| 652,716 |
| 995,740 |
| 4,900,839 |
|
Credited / (charged) to the profit for period | 84,025 |
| (32,680) |
| (16,578) |
| 3,514 |
| (31,007) |
| (306,019) |
| (298,745) |
|
Recognized in equity | — |
| — |
| — |
| — |
| — |
| 26,905 |
| 26,905 |
|
Exchange differences | — |
| — |
| — |
| — |
| — |
| 209,009 |
| 209,009 |
|
Balance on March 31, 2021 | 3,694,330 |
| 33,588 |
| 984,516 |
| 203,975 |
| 391,611 |
| 2,468,619 |
| 7,776,639 |
|
| Consolidated | ||||||||||||||
| Effects on the formation of joint ventures |
| Intangible assets |
| Unrealized income on derivatives |
| Leases |
| Fair value adjustment |
| Other |
| Unrealized credits |
| Total |
Balance on December 31, 2020 | (1,135,036) |
| (1,054,417) |
| (836,629) |
| (3,245) |
| — |
| (529,788) |
| (21,133) |
| (3,580,248) |
Corporate reorganization (Note 1.2) | — |
| (2,545,467) |
| (801,495) |
| (18,706) |
| 215,862 |
| (66,408) |
| (2,322,732) |
| (5,538,946) |
(Charged) / credited to the profit for period | — |
| (6,068) |
| (65,062) |
| 23,995 |
| (105,282) |
| (97,498) |
| (18,385) |
| (268,300) |
Recognized in equity | — |
| — |
| — |
| — |
| — |
| 80,273 |
| — |
| 80,273 |
Balance on March 31, 2021 | (1,135,036) |
| (3,605,952) |
| (1,703,186) |
| 2,044 |
| 110,580 |
| (613,421) |
| (2,362,250) |
| (9,307,221) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total deferred taxes recorded |
|
|
|
|
|
|
|
|
|
|
|
|
|
| (1,530,582) |
The Company expects to realize the full-deferred tax on temporary differences.
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
14 Provision for legal proceedings and judicial deposits
The Company had provision for legal proceedings and judicial deposits recorded at March 31, 2021 and December 31, 2020 in respect of:
| Provision for legal proceedings | ||||||
| Parent Company |
| Consolidated | ||||
| March 31, 2021 |
| December 31, 2020 |
| March 31, 2021 |
| December 31, 2020 |
Tax | 155,101 |
| 155,610 |
| 634,989 |
| 555,958 |
Civil, environmental and regulatory | 79,800 |
| 75,001 |
| 382,662 |
| 200,597 |
Labor | 77,807 |
| 78,208 |
| 376,802 |
| 131,239 |
| 312,708 |
| 308,819 |
| 1,394,453 |
| 887,794 |
| Judicial deposit | ||||||
| Parent Company |
| Consolidated | ||||
| March 31, 2021 |
| December 31, 2020 |
| March 31, 2021 |
| December 31, 2020 |
Tax | 301,549 |
| 296,223 |
| 470,914 |
| 414,413 |
Civil, environmental and regulatory | 49,896 |
| 50,027 |
| 142,041 |
| 81,420 |
Labor | 33,847 |
| 34,477 |
| 271,448 |
| 48,393 |
| 385,292 |
| 380,727 |
| 884,403 |
| 544,226 |
Changes in provision for legal proceedings:
| Parent Company | ||||||
| Tax |
| Civil, environmental and regulatory |
| Labor |
| Total |
At December 31, 2020 | 155,610 |
| 75,001 |
| 78,208 |
| 308,819 |
Provisions | 2,977 |
| 919 |
| 3,271 |
| 7,167 |
Settlement / Write-offs | (2,071) |
| (1) |
| (4,810) |
| (6,882) |
Monetary variation (i) | (1,415) |
| 3,881 |
| 1,138 |
| 3,604 |
At March 31, 2021 | 155,101 |
| 79,800 |
| 77,807 |
| 312,708 |
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
| Consolidated | ||||||
| Tax |
| Civil, environmental and regulatory |
| Labor |
| Total |
At December 31, 2020 | 555,958 |
| 200,597 |
| 131,239 |
| 887,794 |
Corporate reorganization (Note 1.2) | 79,494 |
| 170,122 |
| 247,958 |
| 497,574 |
Provisions | 3,264 |
| 2,249 |
| 10,434 |
| 15,947 |
Settlement / Write-offs | (2,596) |
| (3,517) |
| (18,143) |
| (24,256) |
Monetary variation (i) | (1,131) |
| 13,211 |
| 5,314 |
| 17,394 |
At March 31, 2021 | 634,989 |
| 382,662 |
| 376,802 |
| 1,394,453 |
(i) Includes write-off of interest due to reversals.
The Company’s legal proceedings are secured by assets, cash deposit, bank guarantee or insurance guarantee.
The Company has indemnity actions in addition to those mentioned, which, since they are considered probable, were not recorded because they represent contingent assets.
a) Probable losses
Tax: The principal tax proceedings for which the risk of loss is probable are described below:
| Parent Company |
| Consolidated | ||||
| March 31, 2021 |
| December 31, 2020 |
| March 31, 2021 |
| December 31, 2020 |
Compensation with FINSOCIAL | — |
| — |
| 296,919 |
| 296,445 |
INSS - Social security | 63,299 |
| 63,109 |
| 98,503 |
| 73,835 |
State VAT - ICMS credit | 23,123 |
| 28,440 |
| 88,469 |
| 42,272 |
PIS and COFINS | 4,002 |
| 254 |
| 6,056 |
| 254 |
IPI - Excise tax credit - NT | 54,559 |
| 53,707 |
| 54,559 |
| 53,697 |
Federal income taxes | 901 |
| 900 |
| 8,395 |
| 9,508 |
Other | 9,217 |
| 9,200 |
| 82,088 |
| 79,947 |
| 155,101 |
| 155,610 |
| 634,989 |
| 555,958 |
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
Labor claims: The Company and its subsidiaries are also parties to a number of labor claims filed by former employees and service providers challenging, among other matters, the payment of overtime, night shift premiums and risk premiums, the recognition of employment relationships and the reimbursement of discounts from payroll, such as social contribution and trade union charges. Additionally, we are involved in several labor administrative and judicial proceedings such as labor investigations and class actions filed by the labor prosecutor’s office regarding alleged non-compliance with certain labor regulations, including work and safety rules, labor conditions and work environment, and social assistance plans. Moreover, we entered into certain consent orders (Termos de Ajustamento de Conduta) with Brazilian authorities and in the event we fail to comply with such consent orders, we could be subject to fines.
b) Possible losses
The principal proceedings for which we deem the risk of loss as possible are described below:
| Parent Company |
| Consolidated (i) | ||||
| March 31, 2021 |
| December 31, 2020 |
| March 31, 2021 |
| December 31, 2020 |
Tax | 4,642,673 |
| 4,527,947 |
| 13,807,860 |
| 9,761,688 |
Civil, environmental and regulatory | 976,249 |
| 938,232 |
| 5,597,877 |
| 1,710,495 |
Labor | 26,133 |
| 32,962 |
| 916,655 |
| 77,130 |
| 5,645,055 |
| 5,499,141 |
| 20,322,392 |
| 11,549,313 |
(i) With the corporate reorganization detailed in note 1.2, the processes were merged and are now consolidated.
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
Tax:
| Parent Company |
| Consolidated | ||||
| March 31, 2021 |
| December 31, 2020 |
| March 31, 2021 |
| December 31, 2020 |
Federal income taxes (i) | 824,107 |
| 553,814 |
| 4,638,088 |
| 3,834,562 |
ICMS - State VAT (ii) | 1,466,826 |
| 1,251,021 |
| 3,193,937 |
| 1,922,374 |
PIS and COFINS - Revenue taxes (iii) | 1,227,142 |
| 1,162,790 |
| 2,152,321 |
| 1,314,144 |
IRRF - Withholding tax | 1,332 |
| 1,323 |
| 1,230,466 |
| 1,093,718 |
Penalties related to tax positions (iv) | — |
| — |
| 532,951 |
| — |
IPI - Excise tax credit - NT | 314,627 |
| 314,525 |
| 455,793 |
| 455,121 |
MP 470 - Tax installments | 241,657 |
| 369,322 |
| 358,113 |
| 241,224 |
INSS - Social security and other | 114,315 |
| 159,460 |
| 185,875 |
| 210,357 |
Compensation with IPI - IN 67/98 | 138,142 |
| 138,687 |
| 183,875 |
| 137,976 |
Goodwill Rumo | — |
| — |
| 85,136 |
| — |
Stock option | — |
| — |
| 64,124 |
| — |
Other | 314,525 |
| 577,005 |
| 727,181 |
| 552,212 |
| 4,642,673 |
| 4,527,947 |
| 13,807,860 |
| 9,761,688 |
The main variations in the balances of possible tax contingencies in the period ended March 31, 2021 are due to the corporate reorganization (note 1.2) generated by the subsidiary Rumo and subsidiaries. Below is a description of the main processes:
(i) | Tax assessment notices requiring IRPJ and CSLL related: (a) Goodwill Malha Norte: Tax assessment notices issued for the collection of IRPJ and CSLL, combined with interest on late payment and official and isolated fines. According to the Federal Revenue, Rumo Malha Norte would have unduly amortized the goodwill from the acquisition of the companies Brasil Ferrovias S.A. and Novoeste Brasil S.A. (b) GIF, TPG and Teaçu premiums. Infraction notices drawn up for the collection of IRPJ and CSLL, combined with an official fine and late payment interest, in addition to an isolated fine, for the following reasons: Deduction, from the actual profit and the CSLL calculation base, from the amount corresponding to the amortization in acquisition of interest in Teaçu Armazéns Gerais S.A.; Deduction, from real profit and CSLL calculation base, of the amount corresponding to the amortization of goodwill paid by the companies TPG Participações S.A. and GIF LOG Participações S.A. on the acquisition of shares issued by Rumo Logística S.A.; (c) Labor provisions: In 2009, under the allegation that the Company would have excluded labor provisions from the calculation of taxable income and the adjusted calculation base of CSLL. In the understanding of the Tax Authorities, the write-offs of the labor provisions were made by the Company without the individualization of the processes (provisions and reversals), which would have an impact on the tax assessment. The likelihood of loss is possible, considering that the occurrence of the decay and that the Company complied with all tax rules related to the addition and exclusion of provisions in the calculation of IRPJ and CSLL. |
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
(ii) | Infraction Notices drawn up by the São Paulo State Finance Department, against Rumo Malha Paulista, for the period from February 2011 to July 2015, as well as 2014 and 2018, with the reporting of infractions for alleged lack collection of ICMS in the provision of rail transport services for export; improper credit of ICMS for alleged bookkeeping in the Book of Entries of amounts higher than those found in the Tax Books; improper credit of ICMS for acquisitions supposedly classified as use and consumption. Fines of 50% of the tax amount and 100% of the amount of credit considered undue were also included. | |
(iii) | The administrative demands for PIS and COFINS are substantially related to the disallowance of PIS and COFINS credits by the non-cumulative system related to the following items: a) credits launched out of time unaccompanied by prior rectification of tax returns; b) claims on expenses arising from mutual traffic contracts; c) credits related to expenses with services classified as inputs in the activity carried out by the Company that supposedly were not proven during the Inspection; d) credits on expenses with transportation of employees; e) credits related to electricity expenses; f) credits on expenses with machinery rentals and rentals that were not proven in the course of the Inspection; g) credits on expenses on the acquisition of machinery, equipment and other assets incorporated into the Company's fixed assets. | |
(iv) | The subsidiary Rumo was assessed for not considering the tax benefits of REPORTO (suspension of PIS and COFINS), under the allegation that the locomotives and wagons acquired in the year 2010 to 2012 were used outside the limits of the port area. Consequently, PIS and COFINS were required, in addition to the isolated fine corresponding to 50% of the value of the acquired assets. |
In addition, the effects of IFRIC 23 - Uncertain Tax Position that could affect the accounting policies of the Company and its subsidiaries and these interim financial statements were not identified.
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
c) Contingent assets
(i) | March 15, 2017, in case that sets a judicial precedent, the Brazilian Federal Supreme Court (Supremo Tribunal Federal) or “STF,” granted Extraordinary Appeal 574,706 against a decision that required the exclusion of a tax on sales and services which applies to goods, and transportation and communication (Imposto sobre Operações relativas à Circulação de Mercadorias e Prestação de Serviços de Transporte Interestadual e Intermunicipal e de Comunicação), or “ICMS,” in the calculation of the tax basis of social security regulations for unemployment insurance (Programa de Integração Social), or “PIS,” and retirement and health care contributions (Contribuição para o Financiamento da Seguridade Social), or “COFINS,” (respectively, the profit participation contributions due on certain revenues net of some expenses). Therefore, the amounts refer mainly to credits generated by excluding ICMS from the PIS and COFINS calculation basis. In 2018, the Company had already recognized credits related to periods after March 2017, based on the decision rendered on that date by the STF, in Extraordinary Appeal 574,706. In addition, the amounts related to the prior periods for the group companies with favorable final decisions for the referred subject were determined based on accounting and tax systems, considering the amount of ICMS highlighted in the invoices. The accuracy of the values was tested by crossing the information with relevant ancillary obligations. In the subsidiary Comgás there is still an approximate amount of R$954,000, resulting from the period prior to the STF decision and without final judgment, which remains a contingent asset. | |
(ii) | On December 6, 2019, ARSESP published Resolution 933, for the purpose of non-tariff compensation to the Concessionaire, in the amount of R$697,233 in April 2018 currency, before monetary restatements, as a result of the 3rd Ordinary Tariff Review, a be applied in the form that may be defined by the Granting Authority until May 31, 2020. With the publication of the aforementioned Resolution, there are no more tariff discussions related to previous periods with the Regulatory Agency. |
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
On May 27, 2020, ARSESP, through Deliberation No. 995, recalculated the amount object of Deliberation ARSESP No. 933, due to the update of the applicable regulatory remuneration base, reaching a credit in favor of the Concessioner in the amount of R$683,358 (previously was R$697,233), in 2018 currency, without capitalization, to be applied to the reversibility of assets at the time of the termination of the concession contract, or in the definition of the term extension of the current concession contract to recover the amount, or in the definition of the criteria for the extension of the current concession contract, as may be defined by Granting Authority. After certain additional review processes carried out by the Regulatory Agency (motivated by suits from customers and Comgás itself), which found that 4RTQ was overestimated, as well as 3RTQ, on the other hand, was underestimated in tariff terms, it was concluded that the correct amount of 3RTQ, after compensation for such errors by the agency would be estimated at R$296,191, which value on March 31, 2021 continues to be treated as a contingent asset. | ||
(iii) | The Company has an indemnity proceeding due to the economic and financial imbalance of the Concession Agreement, with respect to tariff reviews. The right to recovery is the result of the wrong criteria followed for the tariff review. The updated case amount is R$778,139 by way of economic and financial rebalancing of the subsidiary Comgás, there was no accounting record. |
15 Shareholders’ equity
a) Share capital
The subscribed capital of R$6,365,853 as of March 31, 2021 and R$5,727,478 as of 31 December 2020, fully paid in, is represented by 394,210,000 nominative common shares, book-entry and without par value. According to the bylaws, the authorized capital may be increased up to the limit of R$7,000,000. After the approval of the proposal to split the shares issued by the Company on April 30, 2021 (Note 23), the number increased to 1,874,070,932 shares.
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
As at March 31, 2021 the Company's capital stock is composed by the following:
Shareholders - Common shares |
| Quantity before split |
| Quantity after split | % | |
Group control |
| 168,190,533 |
| 672,762,132 | 35.90% | |
Administrators |
| 6,221,713 |
| 24,886,852 | 1.33% | |
Free Float |
| 292,309,436 |
| 1,169,237,744 | 62.39% | |
|
|
|
|
|
| |
Total shares outstanding |
| 466,721,682 |
| 1,866,886,728 | 99.62% | |
|
|
|
|
|
| |
Treasury shares |
| 1,796,051 |
| 7,184,204 | 0.38% | |
|
|
|
|
|
| |
Total |
| 468,517,733 |
| 1,874,070,932 | 100.00% |
As a consequence of the corporate reorganization detailed in note 1.2, it was deliberate to increase the Company's capital by R$638,375, in addition to the effect of a reduction in the capital reserve in the amount of R$1,400,557.
b) Treasury shares
On March 31, 2021, the Company had 1,796,051 shares in treasury (11,749,038 shares on December 31, 2020), whose market price was R$92.54. Additionally, 12,987 shares were delivered to the members of the share-based compensation plans. This reduction refers to: (i) the cancellations of 10,000,000 shares, equivalent to R$496,916 resulting from the corporate restructuring process as presented in note 1.2, effective on February 2, 2021, (ii) repurchase of 60,000 shares equivalent to R$4,778 and (iii) delivery of 12,987 shares to members of the share-based compensation plans.
On March 26, 2021, the Company approved the common share buyback program, with a maximum of 17,000,000 shares, representing 5.89% of the total shares available on the market, with the deadline until September 25, 2022, for the purpose of keeping in treasury, cancellation or sale. To date, no shares have been repurchased under this program.
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
c) Other comprehensive (loss) income
|
| December 31, 2020 |
| Comprehensive (loss) income |
| March 31, 2021 |
Loss on cash flow hedge |
| (761,203) |
| (256,387) |
| (1,017,590) |
Foreign currency translation effects |
| 782,899 |
| 272,535 |
| 1,055,434 |
Actuarial loss on defined benefit plan |
| (363,375) |
| — |
| (363,375) |
|
| 123,547 |
| — |
| 123,547 |
Gain on measurement of derivative financial instrument |
| (45,631) |
| — |
| (45,631) |
Change in fair value of financial assets net of tax |
| 26,256 |
| 139 |
| 26,395 |
Total |
| (237,507) |
| 16,287 |
| (221,220) |
|
|
|
|
|
|
|
Attributable to: |
|
|
|
|
|
|
Owners of the Company |
| (252,610) |
| (10,709) |
| (263,319) |
Non-controlling interests |
| 15,103 |
| 26,996 |
| 42,099 |
|
| December 31, 2019 |
| Comprehensive (loss) income |
| March 31, 2021 |
Loss on cash flow hedge |
| (234,575) |
| (155,635) |
| (390,210) |
Foreign currency translation effects |
| 50,183 |
| 610,682 |
| 660,865 |
Actuarial loss on defined benefit plan |
| (202,444) |
| — |
| (202,444) |
Gain on measurement of derivative financial instrument |
| (45,631) |
| — |
| (45,631) |
Change in fair value of financial assets net of tax |
| 25,979 |
| (1) |
| 25,978 |
Total |
| (406,488) |
| 455,046 |
| 48,558 |
|
|
|
|
|
|
|
Attributable to: |
|
|
|
|
|
|
Owners of the Company |
| (349,501) |
| 407,861 |
| 58,360 |
Non-controlling interests |
| (56,987) |
| 47,185 |
| (9,802) |
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
16 Earnings per share
Basic earnings per share are calculated by dividing net earnings by the weighted average number of common shares outstanding during the period. The diluted earnings per share are calculated by adjusting the earnings and the number of shares by the impacts of potentially dilutive instruments.
The following table sets forth the calculation of earnings per share (in thousands of Brazilian reais, except per share amounts):
|
| Consolidated | ||
|
| March 31, 2021 |
| March 31, 2020 (Restated) (i) |
Profit attributable from to ordinary equity holders - basic |
| 638,807 |
| 102,250 |
|
|
|
|
|
|
|
|
|
|
Effect of dilution: |
|
|
|
|
Dilutive effect of subsidiary's stock option plan |
| (2,839) |
| (879) |
Dilution effect of Brado's liquidity option |
| (77) |
| — |
|
|
|
|
|
Profit attributable to ordinary equity holders adjusted for the effect of dilution |
| 635,891 |
| 101,371 |
|
|
|
|
|
|
|
|
|
|
Weighted-average number of shares outstanding - basic (In thousands of shares) |
| 1,733,484 |
| 1,560,522 |
|
|
|
|
|
Dilutive effect of stock option plan |
| 2,980 |
| 5,186 |
|
|
|
|
|
Weighted-average number of shares outstanding - diluted (In thousands of shares) |
| 1,736,464 |
| 1,565,708 |
|
|
|
|
|
Earnings per share |
|
|
|
|
Basic |
| R$ 0.3685 |
| R$ 0.0655 |
Diluted |
| R$ 0.3662 |
| R$ 0.0647 |
(i) | As disclosed in note 23, it was approved at the AGM of April 30, 2021 to split the Company's shares in the proportion of 1: 4. Consequently, the weighted average of the shares is being adjusted for all reference periods. |
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
Dilutive instruments
The Company’s subsidiaries have two categories of potential dilutive effects: share options and put options. For the share options, a calculation is done to determine the effect of the dilution in the profit attributable to shareholders of the parent due the exercise of the share options at subsidiaries. For the put option, is assumed to have been converted into ordinary shares, and the profit attributable to shareholders of the parent is adjusted.
The non-controlling shareholders of the indirect subsidiary Brado, are entitled to exercise the Liquidity Option provided for in the shareholders' agreement signed on August 5, 2013. This option consists of replacing the totality of the shares held by said non-controlling shareholders with a number of shares determined according to the established exchange ratio, which takes into account the economic value to be established both for the Brado business and for the Company's business. At the Company's sole discretion, an equivalent cash payment is also possible. The assumptions of value and form of settlement are subject to the decision of the arbitration proceeding and on March 31, 2021 the effect is antidilutive whereas for March 31, 2021 the best estimate is 3,264 shares, with dilutive effect, which, therefore, are considered in the analysis of diluted earnings per share.
Anti-dilutive instruments
In the period ended March 31, 2021, 17,000,000 shares related to the Company's share buyback plan have an antidilutive effect, therefore they were not considered in the analysis of diluted earnings per share.
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
17 Net sales
The following present the reconciliation between gross revenues and revenues presented in the income statement for the period:
|
| Consolidated | ||
|
| March 31, 2021 |
| March 31, 2020 |
Gross revenue from sales of products and services |
| 5,636,373 |
| 4,215,497 |
Construction revenue |
| 179,282 |
| 197,221 |
Indirect taxes and deductions |
| (1,099,856) |
| (906,206) |
Net sales |
| 4,715,799 |
| 3,506,512 |
In the following table, revenue is disaggregated by products and service lines and timing of revenue recognition:
|
| Consolidated | ||
|
| March 31, 2021 |
| March 31, 2020 |
At a point in time |
|
|
|
|
Natural gas distribution |
| 2,093,727 |
| 2,095,755 |
Electricity trading |
| 219,210 |
| 168,775 |
Lubricants and basic oil |
| 1,386,497 |
| 1,004,744 |
Other |
| 24,756 |
| 13,594 |
|
| 3,724,190 |
| 3,282,868 |
Over time |
|
|
|
|
Railroad transportation services |
| 759,107 |
| — |
Port elevation |
| 26,244 |
| — |
Construction revenue |
| 179,282 |
| 197,221 |
Other services |
| 31,059 |
| 26,423 |
|
| 995,692 |
| 223,644 |
|
|
|
|
|
Elimination |
| (4,083) |
| — |
|
|
|
|
|
Total of net sales |
| 4,715,799 |
| 3,506,512 |
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
18 Costs and expenses by nature
The costs and expenses are presented in the statement of profit and loss by function. The reconciliation of income by nature/purpose is as follows:
|
| Parent Company |
| Consolidated | ||||
|
| March 31, 2021 |
| March 31, 2020 |
| March 31, 2021 |
| March 31, 2020 |
Raw materials |
| — |
| — |
| (1,013,029) |
| (749,081) |
Commodity cost (natural gas) |
| — |
| — |
| (1,203,636) |
| (1,129,450) |
Electricity purchased for resale |
| — |
| — |
| (218,703) |
| (169,489) |
Transportation expenses |
| — |
| — |
| (452,959) |
| (218,169) |
Depreciation and amortization |
| (2,474) |
| (2,814) |
| (311,311) |
| (143,520) |
Personnel expenses |
| (17,429) |
| (12,706) |
| (252,519) |
| (126,519) |
Construction cost |
| — |
| — |
| (179,282) |
| (197,221) |
Expenses with third-party services |
| (9,798) |
| (5,409) |
| (110,857) |
| (65,720) |
Selling expenses |
| — |
| — |
| (4,113) |
| (5,043) |
Other |
| (17,636) |
| (13,993) |
| (145,721) |
| (132,786) |
|
| (47,337) |
| (34,922) |
| (3,892,130) |
| (2,936,998) |
|
|
|
|
|
|
|
|
|
Cost of sales |
| — |
| — |
| (3,369,867) |
| (2,486,377) |
Selling expenses |
| — |
| — |
| (158,655) |
| (279,396) |
General and administrative expenses |
| (47,337) |
| (34,922) |
| (363,608) |
| (171,225) |
|
| (47,337) |
| (34,922) |
| (3,892,130) |
| (2,936,998) |
19 Other income (expenses), net
| Parent company | Consolidated | |||||
| March 31, 2021 |
| March 31, 2020 |
| March 31, 2021 |
| March 31, 2020 |
Disposal of credit rights | — |
| (68,311) |
| — |
| (68,311) |
Gain (loss) on disposal of non-current assets and intangibles | — |
| — |
| 316 |
| (1,781) |
Net effect of legal proceedings | (24,013) |
| (7,027) |
| (35,459) |
| (6,775) |
Revenue from scrap / eventual sales | 1,240 |
| — |
| 11,375 |
| — |
Other | (2,267) |
| 790 |
| (5,158) |
| 40,913 |
| (25,040) |
| (74,548) |
| (28,926) |
| (35,954) |
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
20 Finance results
Details of finance income and costs are as follows:
| Parent Company | Consolidated | |||||
| March 31, 2021 |
| March 31, 2020 |
| March 31, 2021 |
| March 31, 2020 |
Cost of gross debt |
|
|
|
|
|
|
|
Interest on debt | (47,266) |
| (3,454) |
| (440,964) |
| (175,288) |
Monetary and exchange rate variation | (125,730) |
| — |
| (1,029,497) |
| (1,719,422) |
Derivatives and fair value measurement | 477,239 |
| 1,349,217 |
| 1,064,956 |
| 1,199,844 |
Amortization of borrowing costs | (756) |
| (4,320) |
| (50,419) |
| (4,544) |
Guarantees and warranties | — |
| — |
| (8,643) |
| (3,860) |
| 303,487 |
| 1,341,443 |
| (464,567) |
| (703,270) |
|
|
|
|
|
|
|
|
Income from financial investment and exchange rate in cash and cash equivalents | 8,236 |
| 26,840 |
| 92,757 |
| 179,331 |
| 8,236 |
| 26,840 |
| 92,757 |
| 179,331 |
|
|
|
|
|
|
|
|
Cost of debt, net | 311,723 |
| 1,368,283 |
| (371,810) |
| (523,939) |
|
|
|
|
|
|
|
|
Other charges and monetary variations |
|
|
|
|
|
|
|
Interest on other receivables | 8,158 |
| 5,683 |
| 84,149 |
| 30,067 |
Monetary variation of other financial assets | (42,709) |
| (167,354) |
| (42,709) |
| (167,354) |
Interest on other payables | (4,143) |
| (15,823) |
| (22,976) |
| (37,335) |
Interest on lease liabilities | (841) |
| — |
| (76,732) |
| — |
Interest on shareholders' equity | 19,221 |
| 19,000 |
| — |
| — |
Interest on contingencies and contracts | (7,299) |
| — |
| (39,005) |
| — |
Bank charges and other | (3,237) |
| (3,985) |
| (6,786) |
| (7,135) |
Exchange variation and non-debt derivatives | (586,181) |
| (1,558,462) |
| 93,958 |
| 82,499 |
| (617,031) |
| (1,720,941) |
| (10,101) |
| (99,258) |
|
|
|
|
|
|
|
|
Finance results, net | (305,308) |
| (352,658) |
| (381,911) |
| (623,197) |
|
|
|
|
|
|
|
|
Reconciliation |
|
|
|
|
|
|
|
Finance expense | (202,357) |
| (291,755) |
| (171,818) |
| (748,020) |
Finance income | 36,325 |
| 60,779 |
| 191,152 |
| 265,649 |
Foreign exchange, net | (729,972) |
| (1,406,185) |
| (991,459) |
| (1,538,025) |
Derivatives | 590,696 |
| 1,284,503 |
| 590,214 |
| 1,397,199 |
Finance results, net | (305,308) |
| (352,658) |
| (381,911) |
| (623,197) |
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
21 Post-employment benefits
| Consolidated | ||
| March 31, 2021 |
| December 31, 2020 |
Defined contribution |
|
|
|
Futura II | 238 |
| 129 |
|
|
|
|
Defined benefit |
|
|
|
Futura | 165,918 |
| 163,972 |
Comgás | 568,135 |
| 564,576 |
| 734,291 |
| 728,677 |
During the period ended March 31, 2021, the amount of the sponsors' contributions to the plans was R$7,434 (R$10,498 as of March 31, 2020).
22 Share-based payment
The plans have been administered by the Board of Directors, at its option, by a Committee, within the limits established in the guidelines for the elaboration and structuring of each plan and in the applicable legislation.
The detail of plans, including the quantity of granted shares and expected life in years is as follow:
a) Share-based compensation plan
According to the plan, eligible employees can receive common shares annually without cash payment. The number of shares issued to program participants is the value of the offer divided by the weighted average price at which the Company's shares are traded on the Stock Exchange.
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
For share-based compensation settled with shares, the expense is based on the date of granting the fair value of the premiums that must be acquired during the grace period. For awards with graduated vesting, the fair value of each tranche is recognized during the respective grace period. At the end of each reporting period, the Company reassesses its estimates of the number of premiums that must be acquired and recognizes the impact of the revisions in the income statement.
The Black-Scholes methodology was used to calculate the fair value under the terms of the Share-Based Compensation Plan.
Subsidiary CLI has a phantom stock plan that provides for the granting of share appreciation rights (“SARs”) and other cash-based awards to certain employees. SARs offer the opportunity to receive a cash payment equal to the fair market value of the Company's common shares, less the concession price. The offsetting expense is recognized based on the fair value of the premiums that must be acquired and remain open at the end of the reporting period using a Black-Scholes option pricing model. Any changes in liabilities are recognized in profit or loss.
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
Type of award / Grant date |
| Company |
| Expected life (years) |
| Granted |
| Exercised / canceled / transferred |
| Available |
| Fair value at grant date - R$ |
Stock grant programs |
|
|
|
|
|
|
|
|
|
|
|
|
April 27, 2017 |
| Cosan S.A. |
| 5 |
| 274,000 |
| (90,800) |
| 183,200 |
| 37.00 |
July 31, 2017 |
| Cosan S.A. |
| 5 |
| 298,107 |
| (99,212) |
| 198,895 |
| 32.22 |
July 31, 2018 |
| Cosan S.A. |
| 5 |
| 210,602 |
| (26,894) |
| 183,708 |
| 38.61 |
July 31, 2019 |
| Cosan S.A. |
| 5 |
| 57,255 |
| (5,020) |
| 52,235 |
| 49.85 |
July 31, 2020 |
| Cosan S.A. |
| 5 |
| 17,243 |
| — |
| 17,243 |
| 83.73 |
|
|
|
|
|
| 857,207 |
| (221,926) |
| 635,281 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
April 20, 2017 |
| Comgás |
| 5 |
| 61,300 |
| (14,405) |
| 46,895 |
| 47.80 |
August 12, 2017 |
| Comgás |
| 5 |
| 97,780 |
| (13,616) |
| 84,164 |
| 54.25 |
August 1, 2018 |
| Comgás |
| 5 |
| 96,787 |
| (5,338) |
| 91,449 |
| 59.66 |
July 31, 2019 |
| Comgás |
| 5 |
| 83,683 |
| (3,997) |
| 79,686 |
| 78.58 |
February 01, 2020 |
| Compass Gás e Energia |
| 5 |
| 1,858,969 |
| — |
| 1,858,969 |
| 13.58 |
|
|
|
|
|
| 2,198,519 |
| (37,356) |
| 2,161,163 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
January 02, 2017 |
| Rumo S.A. |
| 5 |
| 1,476,000 |
| (236,000) |
| 1,240,000 |
| 6.10 |
September 01, 2017 |
| Rumo S.A. |
| 5 |
| 870,900 |
| (144,450) |
| 726,450 |
| 10.42 |
August 01, 2018 |
| Rumo S.A. |
| 5 |
| 1,149,544 |
| (173,453) |
| 976,091 |
| 13.94 |
August 15, 2019 |
| Rumo S.A. |
| 5 |
| 843,152 |
| (61,023) |
| 782,129 |
| 22.17 |
November 11, 2020 |
| Rumo S.A. |
| 5 |
| 776,142 |
| (11,237) |
| 764,905 |
| 20.01 |
|
|
|
|
|
| 5,115,738 |
| (626,163) |
| 4,489,575 |
|
|
Stock grant - Modification |
|
|
|
|
|
|
|
|
|
|
|
|
August 18, 2011 |
| Cosan S.A. |
| 1 to 12 |
| 1,501,626 |
| (1,276,283) |
| 225,343 |
| 22.80 |
August 31, 2015 (i) |
| Cosan S.A. |
| 5 to 7 |
| 463,906 |
| (463,906) |
| — |
| 19.96 |
|
|
|
|
|
| 1,965,532 |
| (1,740,189) |
| 225,343 |
|
|
Cash-settled transactions |
|
|
|
|
|
|
|
|
|
|
|
|
July 31, 2019 |
| Moove |
| 5 |
| 132,670 |
| — |
| 132,670 |
| 6.74 |
July 31, 2019 |
| Moove |
| 5 |
| 106,952 |
| — |
| 106,952 |
| 13.36 |
|
|
|
|
|
| 239,622 |
| — |
| 239,622 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total |
|
|
|
|
| 10,376,618 |
| (2,625,634) |
| 7,750,984 |
|
|
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
(i) | On February 02, 2021, 12.987 shares were settled in cash in the amount of R$645. |
a) Reconciliation of outstanding share options
The movement in the number of awards outstanding and their related weighted-average exercise prices are as follows:
|
| Stock option programs |
At December 31, 2020 |
| 3,301,596 |
Vested |
| (38,479) |
Transferred |
| 4,532,761 |
Cancelled |
| (44,894) |
At March 31, 2021 |
| 7,750,984 |
b) Measurement of fair values
The weighted average fair value of the programs granted on March 31, 2021 and December 31, 2020 principal assumptions used in applying the Black-Scholes model were as follows:
|
| Stock grant programs | ||||||||||||
|
| Cosan S.A. |
| Compass |
| Comgás |
| Rumo | ||||||
|
| March 31, 2021 |
| December 31, 2020 |
| March 31, 2021 |
| December 31, 2020 |
| March 31, 2021 |
| December 31, 2020 |
| March 31, 2021 |
Weighted average fair value at grant date |
| 39.12 |
| 50.88 |
| 13.58 |
| 13.58 |
| 60.07 |
| 78.58 |
| 13.12 |
Weighted average of key assumptions: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share price at grant date |
| 83.73 |
| 50.88 |
| 13.58 |
| 13.58 |
| 78.58 |
| 78.58 |
| 20.01 |
Risk-free interest rate |
| 6.82% |
| 6.82% |
| N/A |
| N/A |
| 6.82% |
| 6.82% |
| 6.94% |
Dividend yield |
| - |
| 0.00% |
| N/A |
| N/A |
| - |
| - |
| - |
Volatility factor |
| 36.50% |
| 36.50% |
| N/A |
| N/A |
| 32.81% |
| 32.80% |
| 41.03% |
c) Expense recognized in profit or loss
Share-based compensation expense included in the statement of profit and loss for the period ended on March 31, 2021 and December 31, 2020 were R$6,489 and R$6,177, respectively.
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
23 Subsequent events
AGO's deliberations
On April 30, 2021, the Ordinary General Meeting approved: (i) Approval of the management accounts, the management report and the financial statements of the Company, accompanied by the report of the independent auditors, the opinion of the Fiscal Council and the opinion of the Statutory Audit Committee for the fiscal year ended December 31, 2020; (ii) Approval of the management's proposal for the allocation of the Company's results for the fiscal year ended on December 31, 2020; (iii) Installation of the Company's Fiscal Council; (iv) Establishment of the number of members of the Company's Fiscal Council; (v) Election of the effective and alternate members of the Company's Fiscal Council; and (vi) Establishment of the annual global remuneration of the administrators for the fiscal year 2021.
With the effect of the deliberations:
- Distribution of dividends
The distribution of mandatory and additional minimum dividends in the total amount of R$481,000.
- Legal reserve
For the constitution of a legal reserve, the amount of R$42,593 corresponding to 5% (five percent) of the net income for the year, pursuant to the terms of article 193 of the Brazilian Corporation Law;
- Statutory reserve
And the remaining portion related to the fiscal year ended on December 31, 2020 will be allocated to the Company's Special Reserve in the amount of R$328,266, as provided for in article 33, item (iv) of the Company By-Laws.
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
Deliberations of the EGM
On April 30, 2021, the Extraordinary Shareholders' Meeting approved: (i) Amend the caput of article 5 of the Company By-laws, due to the cancellation of 10,000,000 (ten million) shares issued by the Company, carried out by the Board of Administration on February 5, 2021; (ii) Approval of changes to the Company's Indemnity Policy, formerly known as the Directors' Risk Management Policy; and (iii) Approval of the proposal for the split of the shares issued by the Company, in the proportion of 1:4, without changing the capital stock of the Company, consequently changing the caput of article 5 of the Company By-laws .
Issue of debentures Rumo Malha Paulista S.A.
On April 19, 2021, the Board of Directors approved the 2nd issue of simple debentures of the subsidiary Rumo Malha Paulista, not convertible into shares, of unsecured type, with additional personal guarantee, in two series of R$750,000 with a total value of R$1,500,000.
The first series has a 6-year term at an average cost of CDI + 1.69%. The second has a 10-year term at an average cost of IPCA + 4.60%. The two series will have semiannual interest payments and the proceeds of this funding will be used for investment. The funds raised will be invested in expansion works, maintenance of roads, acquisition of assets and technology.
Reduction of Rumo S.A's share capital and profit reserves by absorbing accumulated losses
On April 27, 2021 through the Annual and Extraordinary Shareholders' Meeting, in addition to other resolutions, Management proposed the absorption of the total accumulated losses in the financial statements of December 31, 2020, in the amount of R$3,760,663, with a reserve profit of R$253,599 and with capital in the amount of R$3,507,064, without cancellation of shares. Accordingly, the share capital of Rumo S.A. after the proposed capital reduction will be R$12,547,842.
Notes to the interim financial statements
(In thousands of Brazilian Reais - R$, unless otherwise stated)
Payment 4131 Rumo Malha Central
On April 6, 2021, the Company settled, on the due date, Loan 4131 in the amount of R$209,908.
Funding of credit line with BNDES
On April 29, 2021, Comgás S.A. obtained a release of a credit line pre-approved by the BNDES in the amount of R$23,700, being remunerated by the IPCA + 3.245872% pa, maturing on April 16, 2029. The amount, net of IOF (financial transaction tax), was R$23,255.
Alteration of Comgás Headquarters
On April 28, 2021, the change of the Comgás subsidiary's head quarter office was approved, currently located in the City of São Paulo, State of São Paulo, at 4.100 Brigadeiro Faria Lima Avenue, 4th floor, Rooms 41 and 42, Itaim Bibi neighborhood, zip code 04538-132, for the City of São Paulo, State of São Paulo, at 134 Capitão Faustino de Lima Street, Brás neighborhood, zip code 03040-030, with the consequent amendment of Article 2 of the Company's Bylaws.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
Date: May 14, 2021
COSAN S.A. | |
By: | /s/ Marcelo Eduardo Martins |
| Name: Marcelo Eduardo Martins |
| Title: Chief Financial Officer |