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Form 6-K Fibria Celulose S.A. For: Jul 22

July 23, 2015 7:04 AM EDT

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 


 

FORM 6-K

 


 

Report of Foreign Private Issuer

Pursuant to Rule 13a-16 or 15d-16 of

the Securities Exchange Act of 1934

 

Dated July 22, 2015

 

Commission File Number: 1-15018

 


 

Fibria Celulose S.A.

 


 

Fidêncio Ramos, 302 – 3rd and (part of) 4th floors

Edifício Vila Olímpia, Torre B, Bairro Vila Olímpia

04551-010, São Paulo, SP, 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: x             Form 40-F: o

 

(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: o             No: x

 

(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: o             No: x

 

(Indicate by check mark whether the registrant by furnishing the information contained in this Form, the Registrant is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.)

 

Yes: o            No: x

 

If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b):

 

 

 



 

Fibria Celulose S.A.

Unaudited Consolidated Interim Financial

Information at June 30, 2015

and Report on Review of Interim

Financial Information

 



 

REPORT ON REVIEW OF INTERIM FINANCIAL INFORMATION

 

To the Board of Directors and Shareholders

Fibria Celulose S.A

São Paulo – SP

 

Introduction

 

We have reviewed the accompanying consolidated interim accounting information of Fibria Celulose S.A., for the quarter ended June 30, 2015, comprising the balance sheet at that date the statements of income and comprehensive income for the quarter and six-month periods then ended, the statements of changes in equity and cash flows for the six-month period then ended, and a summary of significant accounting policies and other explanatory information.

 

Management is responsible for the preparation of the consolidated interim accounting information in accordance with the Deliberation CVM 673/11 (which approved accounting standard CPC 21(R1) - Interim Financial Reporting), and International Accounting Standard (IAS) 34 - Interim Financial Reporting issued by the International Accounting Standards Board (IASB).   Our responsibility is to express a conclusion on this interim accounting information based on our review.

 

Scope of the review

 

We conducted our review in accordance with Brazilian and International Standards on Reviews of Interim Financial Information (NBC TR 2410 — Review of Interim Financial Information Performed by the Independent Auditor of the Entity and ISRE 2410 — Review of Interim Financial Information Performed by the Independent Auditor of the Entity, respectively).   A review of interim information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures.   A review is substantially less in scope than an audit conducted in accordance with Brazilian and International Standards on Auditing and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit.   Accordingly, we do not express an audit opinion.

 

Conclusion on the consolidated interim information

 

Based on our review, nothing has come to our attention that causes us to believe that the accompanying consolidated interim accounting information referred to above has not been prepared, in all material respects, in accordance with Deliberation CVM 673/11 and IAS 34.

 

São Paulo, July 21, 2015.

 

Eduardo Affonso de Vasconcelos

Accountant – CRC-1SP166001/O-3

Baker Tilly Brasil Auditores Independentes S/S

CRC-2SP016754/O-1

 

2



 

Fibria Celulose S.A.

 

Unaudited consolidated balance sheet at

In thousands of Reais

 

Assets

 

June 30,
2015

 

December 31,
2014

 

 

 

 

 

 

 

Current

 

 

 

 

 

Cash and cash equivalents (Note 7)

 

684,536

 

461,067

 

Marketable securities (Note 8)

 

701,361

 

682,819

 

Derivative financial instruments (Note 9)

 

26,338

 

29,573

 

Trade accounts receivable, net (Note 10)

 

691,493

 

538,424

 

Inventory (Note 11)

 

1,454,708

 

1,238,793

 

Recoverable taxes (Note 12)

 

183,306

 

162,863

 

Other assets

 

120,466

 

147,638

 

 

 

 

 

 

 

 

 

3,862,208

 

3,261,177

 

 

 

 

 

 

 

Non-current

 

 

 

 

 

Marketable securities (Note 8)

 

71,518

 

51,350

 

Derivative financial instruments (Note 9)

 

175,026

 

161,320

 

Related parties receivables (Note 14)

 

9,308

 

7,969

 

Recoverable taxes (Note 12)

 

1,857,580

 

1,752,101

 

Advances to suppliers

 

700,572

 

695,171

 

Judicial deposits (Note 20)

 

195,582

 

192,028

 

Deferred taxes (Note 13)

 

1,511,358

 

1,190,836

 

Assets held for sale (Note 1(b))

 

598,257

 

598,257

 

Other assets

 

85,529

 

91,208

 

 

 

 

 

 

 

Investments (Note 15)

 

95,163

 

79,882

 

Biological assets (Note 16)

 

3,810,293

 

3,707,845

 

Property, plant and equipment (Note 17)

 

9,007,120

 

9,252,733

 

Intangible assets (Note 18)

 

4,520,937

 

4,552,103

 

 

 

 

 

 

 

 

 

22,638,243

 

22,332,803

 

 

 

 

 

 

 

Total assets

 

26,500,451

 

25,593,980

 

 

3



 

Fibria Celulose S.A.

 

 

 

Unaudited consolidated balance sheet at

 

In thousands of Reais

(continued)

 

Liabilities and shareholders’ equity

 

June 30,
2015

 

December 31,
2014

 

 

 

 

 

 

 

Current

 

 

 

 

 

Loans and financing (Note 19)

 

893,931

 

965,389

 

Derivative financial instruments (Note 9)

 

247,662

 

185,872

 

Trade payables

 

636,575

 

593,348

 

Payroll, profit sharing and related charges

 

110,664

 

135,039

 

Taxes payable

 

97,633

 

56,158

 

Dividends payable

 

152

 

38,649

 

Other payables

 

99,109

 

124,775

 

 

 

 

 

 

 

 

 

2,085,726

 

2,099,230

 

 

 

 

 

 

 

Non-current

 

 

 

 

 

Loans and financing (Note 19)

 

8,121,375

 

7,361,130

 

Derivative financial instruments (Note 9)

 

593,017

 

422,484

 

Taxes payable

 

98

 

124

 

Deferred taxes (Note 13)

 

256,719

 

266,528

 

Provision for contingencies (Note 20)

 

146,363

 

144,582

 

Liabilities related to the assets held for sale (Note 1(b))

 

477,000

 

477,000

 

Other payables

 

256,745

 

207,197

 

 

 

 

 

 

 

 

 

9,851,317

 

8,879,045

 

 

 

 

 

 

 

Total liabilities

 

11,937,043

 

10,978,275

 

 

 

 

 

 

 

Shareholders’ equity

 

 

 

 

 

Share capital

 

9,729,006

 

9,729,006

 

Share capital reserve

 

6,567

 

3,920

 

Treasury shares

 

(10,378

)

(10,346

)

Statutory reserves

 

3,117,291

 

3,228,145

 

Other reserves

 

1,620,826

 

1,613,312

 

Accumulated earnings

 

42,388

 

 

 

 

 

 

 

 

 

Equity attributable to shareholders of the Company

 

14,505,700

 

14,564,037

 

 

 

 

 

 

 

Equity attributable to non-controlling interests

 

57,708

 

51,668

 

 

 

 

 

 

 

Total shareholders’ equity

 

14,563,408

 

14,615,705

 

 

 

 

 

 

 

Total liabilities and shareholders’ equity

 

26,500,451

 

25,593,980

 

 

The accompanying notes are an integral part of these unaudited consolidated interim financial information.

 

4



 

Fibria Celulose S.A.

 

Unaudited consolidated statement of profit or loss

In thousands of Reais, except for the income per shares

 

 

 

2015

 

2014

 

 

 

April 1 to
June 30,
(three months)

 

June 30,
(six months)

 

April 1 to
June 30,
(three months)

 

June 30,
(six months)

 

 

 

 

 

 

 

 

 

 

 

Revenues (Note 21)

 

2,309,319

 

4,306,385

 

1,693,845

 

3,336,176

 

Cost of sales (Note 23)

 

(1,441,056

)

(2,713,321

)

(1,450,976

)

(2,698,770

)

 

 

 

 

 

 

 

 

 

 

Gross profit

 

868,263

 

1,593,064

 

242,869

 

637,406

 

 

 

 

 

 

 

 

 

 

 

Operating income (expenses)

 

 

 

 

 

 

 

 

 

Selling expenses (Note 23)

 

(106,637

)

(201,968

)

(87,857

)

(167,061

)

General and administrative (Note 23)

 

(81,158

)

(153,926

)

(62,344

)

(130,715

)

Equity in income/losses of associate

 

(40

)

750

 

 

 

 

 

Other operating income (expenses), net (Note 23)

 

6,384

 

(14,210

)

914,702

 

920,443

 

 

 

 

 

 

 

 

 

 

 

 

 

(181,451

)

(369,354

)

764,501

 

622,667

 

 

 

 

 

 

 

 

 

 

 

Income before financial income and expenses

 

686,812

 

1,223,710

 

1,007,370

 

1,260,073

 

 

 

 

 

 

 

 

 

 

 

Financial income (Note 22)

 

44,449

 

80,991

 

37,365

 

70,052

 

Financial expenses (Note 22)

 

(136,689

)

(247,119

)

(277,679

)

(750,649

)

Result of derivative financial instruments, net (Note 22)

 

229,825

 

(318,972

)

58,973

 

178,551

 

Foreign exchange losses/gains, net (Note 22)

 

183,323

 

(939,802

)

113,011

 

263,839

 

 

 

 

 

 

 

 

 

 

 

 

 

320,908

 

(1,424,902

)

(68,330

)

(238,207

)

 

 

 

 

 

 

 

 

 

 

Income (loss) before income taxes

 

1,007,720

 

(201,192

)

939,040

 

1,021,866

 

 

 

 

 

 

 

 

 

 

 

Income taxes

 

 

 

 

 

 

 

 

 

Current (Note 13)

 

(18,743

)

(78,601

)

(89,567

)

(101,390

)

Deferred (Note 13)

 

(374,557

)

328,221

 

(218,475

)

(270,074

)

 

 

 

 

 

 

 

 

 

 

Net income for the period

 

614,420

 

48,428

 

630,998

 

650,402

 

 

 

 

 

 

 

 

 

 

 

Attributable to

 

 

 

 

 

 

 

 

 

Shareholders of the Company

 

611,748

 

42,388

 

629,692

 

646,761

 

 

 

 

 

 

 

 

 

 

 

Non-controlling interest

 

2,672

 

6,040

 

1,306

 

3,641

 

 

 

 

 

 

 

 

 

 

 

Net income for the period

 

614,420

 

48,428

 

630,998

 

650,402

 

 

 

 

 

 

 

 

 

 

 

Basic earnings per share - in Reais (Note 25(a))

 

1.105

 

0.077

 

1.137

 

1.168

 

 

 

 

 

 

 

 

 

 

 

Diluted earnings per share - in Reais (Note 25(b))

 

1.104

 

0.076

 

1.137

 

1.168

 

 

The accompanying notes are an integral part of these unaudited consolidated interim financial information.

 

5



 

Fibria Celulose S.A.

 

Unaudited consolidated statement of comprehensive income

In thousands of Reais, except for the income per shares

 

 

 

2015

 

2014

 

 

 

April 1 to
June 30,
(three months)

 

June 30,
(six months)

 

April 1 to
June 30,
(three months)

 

June 30,
(six months)

 

 

 

 

 

 

 

 

 

 

 

Net income for the period

 

614,420

 

48,428

 

630,998

 

650,402

 

 

 

 

 

 

 

 

 

 

 

Other comprehensive income

 

 

 

 

 

 

 

 

 

Items that may be subsequently reclassified to profit or loss

 

 

 

 

 

 

 

 

 

Foreign exchange effect on available-for-sale financial assets — Ensyn

 

(2,688

)

11,384

 

 

 

 

 

Tax effect thereon

 

914

 

(3,870

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total other comprehensive income (loss) for the period, net of taxes

 

(1,774

)

7,514

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total comprehensive income for the period, net of taxes

 

612,646

 

55,942

 

630,998

 

650,402

 

 

 

 

 

 

 

 

 

 

 

Attributable to

 

 

 

 

 

 

 

 

 

Shareholders of the Company

 

609,974

 

49,902

 

629,692

 

646,761

 

Non-controlling interest

 

2,672

 

6,040

 

1,306

 

3,641

 

 

 

 

 

 

 

 

 

 

 

 

 

612,646

 

55,942

 

630,998

 

650,402

 

 

The accompanying notes are an integral part of these unaudited consolidated interim financial information.

 

6



 

Fibria Celulose S.A.

 

Unaudited statement of changes in shareholders’ equity

In thousands of Reais, unless otherwise indicated

 

 

 

Capital

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Transaction

 

 

 

 

 

Other reserves

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

costs of the

 

 

 

 

 

Other

 

 

 

 

 

 

 

 

 

Non-

 

 

 

 

 

 

 

capital

 

Capital

 

Treasury

 

comprehensive

 

Statutory reserves

 

Retained

 

 

 

controlling

 

 

 

 

 

Capital

 

increase

 

reserve

 

shares

 

income

 

Legal

 

Investments

 

earnings

 

Total

 

interest

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

As at December 31, 2013

 

9,740,777

 

(11,771

)

2,688

 

(10,346

)

1,614,270

 

303,800

 

2,805,481

 

 

 

14,444,899

 

46,355

 

14,491,254

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income and other comprehensive income for the period

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

646,761

 

646,761

 

3,641

 

650,402

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

As at June 30, 2014

 

9,740,777

 

(11,771

)

2,688

 

(10,346

)

1,614,270

 

303,800

 

2,805,481

 

646,761

 

15,091,660

 

49,996

 

15,141,656

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

As at December 31, 2014

 

9,740,777

 

(11,771

)

3,920

 

(10,346

)

1,613,312

 

311,579

 

2,916,566

 

 

 

14,564,037

 

51,668

 

14,615,705

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income for the period

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

42,388

 

42,388

 

6,040

 

48,428

 

Other comprehensive income for the period

 

 

 

 

 

 

 

 

 

7,514

 

 

 

 

 

 

 

7,514

 

 

 

7,514

 

 

 

 

 

 

 

 

 

 

 

7,514

 

 

 

 

 

42,388

 

49,902

 

6,040

 

55,942

 

Transactions with shareholders

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Repurchase of shares

 

 

 

 

 

 

 

(32

)

 

 

 

 

 

 

 

 

(32

)

 

 

(32

)

Dividends distributed

 

 

 

 

 

 

 

 

 

 

 

 

 

(110,854

)

 

 

(110,854

)

 

 

(110,854

)

Stock options program

 

 

 

 

 

2,647

 

 

 

 

 

 

 

 

 

 

 

2,647

 

 

 

2,647

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

As at June 30, 2015

 

9,740,777

 

(11,771

)

6,567

 

(10,378

)

1,620,826

 

311,579

 

2,805,712

 

42,388

 

14,505,700

 

57,708

 

14,563,408

 

 

The accompanying notes are an integral part of these unaudited consolidated interim financial information.

 

7



 

Fibria Celulose S.A.

 

Unaudited consolidated statement of cash flows

In thousands of Reais

 

 

 

June 30,
2015

 

June 30,
2014

 

 

 

 

 

 

 

Income (loss) before income taxes

 

(201,192

)

1,021,866

 

 

 

 

 

 

 

Adjusted by

 

 

 

 

 

Depreciation, depletion and amortization

 

896,126

 

847,601

 

Depletion of wood from forestry partnership programs

 

29,866

 

51,536

 

Foreign exchange losses, net

 

939,802

 

(263,839

)

Change in fair value of derivative financial instruments

 

318,972

 

(178,551

)

Equity in losses of jointly-venture

 

(750

)

 

 

Loss on disposal of property, plant, equipment and biological assets, net

 

2,658

 

3,792

 

Interest and gain/losses from marketable securities

 

(38,380

)

(45,380

)

Interest expense from loans and financing

 

207,856

 

245,718

 

Change in fair value of biological assets

 

(29,831

)

(87,192

)

Financial charges on bonds upon partial repurchase

 

 

 

456,417

 

Impairment of recoverable taxes - ICMS

 

42,682

 

47,606

 

Tax credits

 

 

 

(849,520

)

Stock options program

 

2,647

 

 

 

Provisions and other

 

1,539

 

15,168

 

 

 

 

 

 

 

Decrease (increase) in assets

 

 

 

 

 

Trade accounts receivable

 

(17,531

)

(115,024

)

Inventory

 

(151,571

)

(27,274

)

Recoverable taxes

 

(165,356

)

(69,953

)

Other assets

 

(7,023

)

151,996

 

 

 

 

 

 

 

Increase (decrease) in liabilities

 

 

 

 

 

Trade payables

 

(9,452

)

42,109

 

Taxes payable

 

7,678

 

(23,753

)

Payroll, profit sharing and related charges

 

(24,375

)

(34,537

)

Other payables

 

8,700

 

(10,735

)

 

 

 

 

 

 

Cash provided by operating activities

 

1,813,065

 

1,178,051

 

 

 

 

 

 

 

Interest received - marketable securities

 

36,784

 

42,994

 

Interest paid - loans and financing

 

(178,726

)

(239,020

)

Income taxes paid

 

(45,807

)

(5,147

)

 

 

 

 

 

 

Net cash provided by operating activities

 

1,625,316

 

976,878

 

 

8



 

Fibria Celulose S.A.

 

Unaudited consolidated statement of cash flows

In thousands of Reais

(continued)

 

 

 

June 30,
2015

 

June 30,
2014

 

 

 

 

 

 

 

Cash flows from investing activities

 

 

 

 

 

Proceeds from sale of land and building - Asset Light project

 

 

 

902,584

 

Acquisition of property, plant and equipment, intangible assets and forests

 

(751,593

)

(703,719

)

Advances for acquisition of wood from forestry partnership program

 

(34,371

)

(16,679

)

Subsidiary incorporation - Fibria Innovations (Note 15)

 

(11,630

)

 

 

Marketable securities, net

 

(26,636

)

136,996

 

Proceeds from sale of property, plant and equipment

 

30,291

 

(7,861

)

Derivative transactions settled (Note 9(c))

 

(97,122

)

(20,371

)

Others

 

(10

)

(615

)

 

 

 

 

 

 

Net cash provided by (used in) investing activities

 

(891,071

)

290,335

 

 

 

 

 

 

 

Cash flows from financing activities

 

 

 

 

 

Borrowings - loans and financing

 

422,891

 

2,427,458

 

Repayments - loans and financing - principal amount

 

(827,050

)

(3,513,267

)

Premium paid on bond repurchase transaction

 

 

 

(325,668

)

Dividends paid

 

(149,350

)

 

 

Others

 

4,400

 

6,290

 

 

 

 

 

 

 

Net cash used in financing activities

 

(549,109

)

(1,405,187

)

 

 

 

 

 

 

Effect of exchange rate changes on cash and cash equivalents

 

38,333

 

(76,570

)

 

 

 

 

 

 

Net increase (decrease) in cash and cash equivalents

 

223,469

 

(214,544

)

 

 

 

 

 

 

Cash and cash equivalents at beginning of the period

 

461,067

 

1,271,752

 

 

 

 

 

 

 

Cash and cash equivalents at end of the period

 

684,536

 

1,057,208

 

 

The accompanying notes are an integral part of these unaudited consolidated interim financial information.

 

9



 

Fibria Celulose S.A.

 

Notes to the unaudited consolidated interim
financial information at June 30, 2015

In thousands of Reais, unless otherwise indicated

 

1                                        Operations and current developments

 

(a)                                General information

 

Fibria Celulose S.A. is incorporated under the laws of the Federal Republic of Brazil, as a publicly-held company. Fibria Celulose S.A. and its subsidiaries are referred to in this consolidated interim financial information as the “Company”, “Fibria”, or “we”. We have the legal status of a share corporation, operating under Brazilian corporate law. Our headquarters and principal executive office is located in São Paulo, SP, Brazil.

 

We are listed on the stock exchange of São Paulo (BM&FBOVESPA) and the New York Stock Exchange (NYSE) and we are subject to the reporting requirements of the Brazilian Comissão de Valores Mobiliários (CVM) and the United States Securities and Exchange Commission (SEC).

 

Our activities are focused on the growth of renewable and sustainable forests and the manufacture and sale of bleached eucalyptus kraft pulp. Forests in formation are located in the States of São Paulo, Mato Grosso do Sul, Minas Gerais, Rio de Janeiro, Espírito Santo and Bahia.

 

We operate in a single operating segment, which is the producing and selling of short fiber pulp, with our pulp production facilities located in the cities of Aracruz (State of Espírito Santo), Três Lagoas (State of Mato Grosso do Sul), Jacareí (State of São Paulo) and Veracel (State of Bahia) (jointly- controlled entity).

 

The pulp produced for export is delivered to customers by sea vessels on the basis of long-term contracts with the owners of these vessels, through the ports of Santos, located in the State of São Paulo (operated under a concession from Federal Government until 2017) and Barra do Riacho, located in the State of Espírito Santo (operated by our subsidiary Portocel - Terminal Especializado Barra do Riacho S.A.).

 

(b)                                Non-current assets held for sale

 

Losango project assets

 

On December 28, 2012, the Company and CMPC Celulose Riograndense Ltda. (“CMPC”) signed the definitive Purchase and Sale Agreement for the sale of all of the Losango project assets, comprising approximately 100 thousand hectares of land owned by Fibria and approximately 39 thousand hectares of planted eucalyptus and leased land, all located in the State of Rio Grande do Sul, in the amount of R$ 615 million. On this date the first installment of the purchase price, amounting to R$ 470 million, was paid to us. The second installment, amounting to R$ 140 million, was deposited in an escrow account and will be released to us once additional government approvals are obtained. On November 2014, we received an additional R$ 7 million as an advance from CMPC. The final installment of R$ 5 million is payable to us upon the completion of the transfer of the existing land lease contracts for the assets, and the applicable government approvals. The sale and purchase agreement establishes a period of 48 months, renewable at the option of CMPC for an additional 48 months, to obtain the required government approvals. If this approval is ultimately not obtained, we will be required to return to CMPC the amount paid to us, plus interest and the escrow deposits made by CMPC will revert. We have recorded the amount received as a liability under “Advances received in relation to assets held for sale”.

 

Since the signing of the Purchase and Sale Agreement with CMPC, we have taken action to obtain the approvals needed, such as the fulfillment of all conditions precedent, the partial renewal of the operating license of the areas and obtaining the documentation to be presented to the applicable government

 

10



 

Fibria Celulose S.A.

 

Notes to the unaudited consolidated interim
financial information at June 30, 2015

In thousands of Reais, unless otherwise indicated

 

agencies. The consistent progress in obtaining these approvals indicates that favorable resolution will be achieved.

 

We have concluded that these assets should remain classified as assets held for sale. However, the completion of the sale is not under our sole control and it depends on various government approvals, which have been slower than expected. Accordingly we have concluded that they should continue to be classified as non-current assets held for sale as at June 30, 2015.

 

The Losango assets did not generate any significant impact in the unaudited consolidated statement of profit or losses for the six-month period ended June 30, 2015 and 2014.

 

(c)                                 Approval of the expansion plan of the Três Lagoas Unit

 

On May 14, 2015, the Board of Directors approved the expansion plan of the Company consisting of the construction of the second line of pulp production in the unit of Três Lagoas, state of Mato Grosso do Sul, called Horizonte 2 Project.

 

The Horizonte 2 Project consists in the construction of a new bleached eucalyptus pulp production line with capacity of 1.75 million tons per year and an estimated investment of R$ 7.7 billion. The startup of the new production line is projected for the fourth quarter of 2017.

 

The Project will be financed by the free cash flow of the Company and financing, in accordance to the limits established on the Indebtedness Management Policy.

 

2                                        Presentation of consolidated interim financial information and summary of significant accounting policies

 

2.1                              Consolidated interim financial information - basis of preparation

 

(a)                                Accounting policies adopted

 

The consolidated interim financial information has been prepared and is being presented in accordance with IAS 34 and Deliberation 673/11 issued by the Brazilian Securities and Exchange Commission (CVM), which approved the CPC 21(R1) - “Interim Financial Reporting” as issued by the International Accounting Standards Board (IASB) and the Accounting Statements Committee Standards (CPC).

 

The consolidated interim financial information should be read in conjunction with the audited financial statements for the year ended December 31, 2014, considering that its purpose is to provide an update on the activities, events and significant circumstances in relation to those presented in the annual financial statements.

 

The current accounting practices, which include the measurement principles for the recognition and valuation of the assets and liabilities, the calculation methods used in the preparation of this interim financial information and the estimates used, are the same as those used in the preparation of the most recent annual financial statements, except to the items related to the adoption of the new standards, amendments and interpretations issued by IASB and CVM, as detailed in Note 3 below.

 

11



 

Fibria Celulose S.A.

 

Notes to the unaudited consolidated interim
financial information at June 30, 2015

In thousands of Reais, unless otherwise indicated

 

(b)                                Approval of the consolidated interim financial information

 

The consolidated unaudited interim financial information was approved by the Board of Directors on July 21, 2015.

 

2.2                              Critical accounting estimates and assumptions

 

Estimates and assumptions are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. Accounting estimates will seldom match the actual results. In the six-month period ended June 30, 2015, there were no significant changes in the estimates and assumptions which are likely to result in significant adjustments to the carrying amounts of assets and liabilities during the current financial year, compared to those disclosed in Note 3 to our most recent annual financial statements.

 

3                                        New standards, amendments and interpretations issued by IASB and CVM

 

The standards below have been issued and are effectives for future periods. We have not early adopted these standards.

 

Standard

 

Effective
date

 

Main points introduced by the
standard

 

Impacts of the
adoption

IFRS 9 - Financial Instruments

 

January 1, 2018

 

The main change is that, in cases where the fair value option is taken for financial liabilities, the part of a fair value change which is due to an entity’s own credit risk is recorded in other comprehensive income rather than the income statement.

 

The Company is currently assessing the impacts of the adoption.

 

 

 

 

 

 

 

IFRS 15 - Revenue

 

January 1, 2017

 

This accounting standard establishes the accounting principles to be followed by entities to determine and measure revenue and when the revenue should be recognized.

 

The Company is currently assessing the impacts of the adoption.

 

 

 

 

 

 

 

IAS 41 - Agriculture (equivalent to CPC 29 - Biological Assets and Agricultural Produce)

 

January 1, 2016

 

The “bearer plants” should be accounted for as property, plant and equipment (IAS 16/CPC 27), i.e., at cost less depreciation or impairment provision. “Bearer plants” are defined as those used to produce fruit/ regenerate for several years, but the plant itself, once mature, does not suffer relevant changes.

 

The Company is currently assessing the impacts of the adoption.

 

There are no other IFRSs or IFRIC interpretations that are not yet effective that the Company expect to have a material impact on the Company’s financial position and results of operations.

 

12



 

Fibria Celulose S.A.

 

Notes to the unaudited consolidated interim
financial information at June 30, 2015

In thousands of Reais, unless otherwise indicated

 

4                                        Risk management

 

The risk management policies and financial risk factors disclosed in the annual financial statements (Note 4) did not show any significant changes. The Company’s financial liabilities which present liquidity risk are presented below by maturity (Note 4.1), exchange risk exposure (Note 4.2), sensitivity analysis (Note 5) and fair value estimates (Note 6), which was considered relevant by Fibria’s management to be accompanied quarterly.

 

4.1                              Liquidity risk

 

The table below presents the financial liabilities into relevant maturity groupings based on the remaining period from the balance sheet date to the contractual maturity date. The amounts disclosed in the table are the contractual undiscounted cash flows and as such they differ from the amounts presented in the consolidated balance sheet.

 

 

 

Less than
one year

 

Between
one and
two years

 

Between
two and
five years

 

Over five
years

 

 

 

 

 

 

 

 

 

 

 

At June 30, 2015

 

 

 

 

 

 

 

 

 

Loans and financing

 

1,128,158

 

2,046,055

 

4,991,813

 

2,567,315

 

Derivative instruments

 

257,063

 

208,473

 

729,007

 

102,115

 

Trade and other payables

 

735,683

 

74,333

 

35,668

 

35,682

 

 

 

 

 

 

 

 

 

 

 

 

 

2,120,904

 

2,328,861

 

5,756,488

 

2,705,112

 

 

 

 

 

 

 

 

 

 

 

At December 31, 2014

 

 

 

 

 

 

 

 

 

Loans and financing

 

1,156,951

 

2,105,192

 

4,353,071

 

2,203,134

 

Derivative instruments

 

178,964

 

142,662

 

504,133

 

74,545

 

Trade and other payables

 

725,123

 

36,927

 

30,546

 

34,087

 

 

 

 

 

 

 

 

 

 

 

 

 

2,061,038

 

2,284,781

 

4,887,750

 

2,311,766

 

 

4.2                              Foreign exchange risk

 

 

 

June 30,
2015

 

December 31,
2014

 

 

 

 

 

 

 

Assets in foreign currency

 

 

 

 

 

Cash and cash equivalents (Note 7)

 

669,178

 

279,664

 

Marketable securities (Note 8)

 

 

 

61,352

 

Trade accounts receivable (Note 10)

 

621,779

 

496,493

 

 

 

 

 

 

 

 

 

1,290,957

 

837,509

 

 

 

 

 

 

 

Liabilities in foreign currency

 

 

 

 

 

Loans and financing (Note 19)

 

7,093,849

 

6,280,545

 

Trade payables

 

47,964

 

72,263

 

Derivative instruments (Note 9(a))

 

789,322

 

538,451

 

 

 

 

 

 

 

 

 

7,931,135

 

6,891,259

 

 

 

 

 

 

 

Liability exposure

 

(6,640,178

)

(6,053,750

)

 

13



 

Fibria Celulose S.A.

 

Notes to the unaudited consolidated interim
financial information at June 30, 2015

In thousands of Reais, unless otherwise indicated

 

5                                        Sensitivity analysis

 

Sensitivity analysis of changes in foreign currency

 

The Company’s significant risk factor, considering the period of three-month period for the evaluation is its U.S. Dollar exposure. We adopted as the probable scenario the fair value considering the market yield as at June 30, 2015.

 

To calculate the probable scenario the closing exchange rate at the date of these consolidated interim financial information was used (R$ x USD = 3.1026). As the amounts have already been recognized in the consolidated interim financial information, there are no additional effects in the income statement in this scenario. In the “Possible” and “Remote” scenarios, the US Dollar is deemed to appreciate/depreciate by 25% and 50%, respectively, before tax, when compared to the “Probable” scenario:

 

 

 

Impact of an appreciation/depreciation of the
real against the U.S. Dollar
on the fair value - absolute amounts

 

 

 

Possible (25%)

 

Remote (50%)

 

 

 

 

 

 

 

Derivative instruments

 

 

 

 

 

Options

 

344,594

 

958,547

 

Swap contracts

 

577,949

 

1,155,798

 

Loans and financing

 

1,634,019

 

3,268,038

 

Marketable securities

 

120,226

 

240,452

 

 

Sensitivity analysis in changes in interest rate

 

We adopted as the probable scenario the fair value considering the market yield as at June 30, 2015. As the amounts are already recognized in the consolidated interim financial information, there are no additional effects in the income statement in this scenario. In the “Possible” and “Remote” scenarios, the interest rates are deemed to increase/decrease by 25% and 50%, respectively, before tax, when compared to the “Probable” scenario:

 

14



 

Fibria Celulose S.A.

 

Notes to the unaudited consolidated interim
financial information at June 30, 2015

In thousands of Reais, unless otherwise indicated

 

 

 

Impact of an increase/decrease of the interest
rate on the fair value - absolute amounts

 

 

 

Possible (25%)

 

Remote (50%)

 

 

 

 

 

 

 

Loans and financing

 

 

 

 

 

LIBOR

 

372

 

669

 

Currency basket

 

1,604

 

3,207

 

TJLP

 

1,402

 

2,878

 

Interbank Deposit Certificate (CDI)

 

1,557

 

3,072

 

 

 

 

 

 

 

Derivative instruments

 

 

 

 

 

LIBOR

 

13,668

 

27,442

 

TJLP

 

2,597

 

5,307

 

Interbank Deposit Certificate (CDI)

 

20,587

 

39,711

 

 

 

 

 

 

 

Marketable securities (a)

 

 

 

 

 

Interbank Deposit Certificate (CDI)

 

3,180

 

6,110

 

 


(a) Only marketable securities indexed to post-fixed rate were considered in the sensitivity analysis above.

 

Sensitivity analysis in changes in the United States Consumer Price Index - US-CPI

 

To calculate the “Probable” scenario, we used the US-CPI index at June 30, 2015. The “Probable” scenario was stressed considering an additional increase/decrease of 25% and 50% in the US-CPI.

 

 

 

Impact of an appreciation of the
US-CPI at the fair value - absolute amounts

 

 

 

Possible (25%)

 

Remote (50%)

 

 

 

 

 

 

 

Embedded derivative in forestry partnership and standing timber supply agreements

 

137,434

 

284,214

 

 

6                                        Fair value estimates

 

In the six-month period ended June 30, 2015, there were no changes in the criteria of classification of the assets and liabilities in the levels of the fair value hierarchy when compared to the criteria used in the classification of those instruments disclosed in Note 6 to our most recent annual financial statements as at December 31, 2014.

 

15



 

Fibria Celulose S.A.

 

Notes to the unaudited consolidated interim
financial information at June 30, 2015

In thousands of Reais, unless otherwise indicated

 

 

 

June 30, 2015

 

 

 

Level 1

 

Level 2

 

Level 3

 

Total

 

 

 

 

 

 

 

 

 

 

 

Recurring fair value measurements

 

 

 

 

 

 

 

 

 

Assets

 

 

 

 

 

 

 

 

 

At fair value through profit and loss

 

 

 

 

 

 

 

 

 

Derivative instruments (Note 9)

 

 

 

201,364

 

 

 

201,364

 

Warrant to acquire Ensyn’s shares (Note 15)

 

 

 

 

 

14,939

 

14,939

 

Marketable securities (Note 8)

 

105,665

 

589,217

 

 

 

694,882

 

 

 

 

 

 

 

 

 

 

 

Available for sale financial assets

 

 

 

 

 

 

 

 

 

Other investments - Ensyn (Note 15)

 

 

 

 

 

79,116

 

79,116

 

 

 

 

 

 

 

 

 

 

 

Biological asset (Note 16) (*)

 

 

 

 

 

3,810,293

 

3,810,293

 

 

 

 

 

 

 

 

 

 

 

Total assets

 

105,665

 

790,581

 

3,904,348

 

4,800,594

 

 

 

 

 

 

 

 

 

 

 

Liabilities

 

 

 

 

 

 

 

 

 

At fair value through profit and loss

 

 

 

 

 

 

 

 

 

Derivative instruments (Note 9)

 

 

 

840,679

 

 

 

840,679

 

 

 

 

 

 

 

 

 

 

 

Total liabilities

 

 

 

840,679

 

 

 

840,679

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31, 2014

 

 

 

Level 1

 

Level 2

 

Level 3

 

Total

 

 

 

 

 

 

 

 

 

 

 

Recurring fair value measurements

 

 

 

 

 

 

 

 

 

Assets

 

 

 

 

 

 

 

 

 

At fair value through profit and loss

 

 

 

 

 

 

 

 

 

Derivative instruments (Note 9)

 

 

 

190,893

 

 

 

190,893

 

Warrant to acquire Ensyn’s shares (Note 15)

 

 

 

 

 

11,791

 

11,791

 

Marketable securities (Note 8)

 

193,131

 

489,688

 

 

 

682,819

 

 

 

 

 

 

 

 

 

 

 

Available for sale financial assets

 

 

 

 

 

 

 

 

 

Other investments — Ensyn (Note 15)

 

 

 

 

 

67,733

 

67,733

 

 

 

 

 

 

 

 

 

 

 

Biological asset (Note 16) (*)

 

 

 

 

 

3,707,845

 

3,707,845

 

 

 

 

 

 

 

 

 

 

 

Total assets

 

193,131

 

680,581

 

3,787,369

 

4,661,081

 

 

 

 

 

 

 

 

 

 

 

Liabilities

 

 

 

 

 

 

 

 

 

At fair value through profit and loss

 

 

 

 

 

 

 

 

 

Derivative instruments (Note 9)

 

 

 

608,356

 

 

 

608,356

 

 

 

 

 

 

 

 

 

 

 

Total liabilities

 

 

 

608,356

 

 

 

608,356

 

 


(*) See the changes in the fair value of the biological assets in Note 16.

 

There were no transfers between levels 1, 2 and 3 during the periods presented.

 

16



 

Fibria Celulose S.A.

 

Notes to the unaudited consolidated interim
financial information at June 30, 2015

In thousands of Reais, unless otherwise indicated

 

6.1                              Fair value of loans and financing

 

The fair value of loans and financing, which are measured at amortized cost in the balance sheet, is estimated as follows: (a) bonds, for which fair value is based on the observed quoted price in the market (based on an average of closing prices provided by Bloomberg), and (b) for the other financial liabilities that do not have a secondary market, or for which the secondary market is not active, fair value is estimated by discounting the future contractual cash flows by current market interest rates, also considering the Company’s credit risk. The fair value of loans and financing are classified as Level 2 on the fair value hierarchy. The following table presents the fair value of loans and financing:

 

 

 

Yield used to discount (*)

 

June 30,
2015

 

December
31, 2014

 

 

 

 

 

 

 

 

 

Quoted in the secondary market

 

 

 

 

 

 

 

In foreign currency

 

 

 

 

 

 

 

Bonds - VOTO IV

 

 

 

340,400

 

292,188

 

Bonds - Fibria Overseas

 

 

 

1,874,219

 

1,598,708

 

Estimative based on discounted cash flow

 

 

 

 

 

 

 

In foreign currency

 

 

 

 

 

 

 

Export credits

 

LIBOR USD

 

4,310,234

 

3,824,319

 

Export credits (ACC/ACE)

 

DDI

 

153,203

 

260,345

 

In local currency

 

 

 

 

 

 

 

BNDES — TJLP

 

Brazilian interbank rate (DI 1)

 

947,796

 

1,072,412

 

BNDES — Fixed rate

 

Brazilian interbank rate (DI 1)

 

91,956

 

77,980

 

Currency basket

 

Brazilian interbank rate (DI 1)

 

465,357

 

400,233

 

FINEP

 

Brazilian interbank rate (DI 1)

 

2,403

 

2,675

 

FINAME

 

Brazilian interbank rate (DI 1)

 

7,232

 

9,457

 

NCE in Reais

 

Brazilian interbank rate (DI 1)

 

723,657

 

707,872

 

Midwest Fund

 

Brazilian interbank rate (DI 1)

 

26,770

 

32,304

 

 

 

 

 

 

 

 

 

 

 

 

 

8,943,227

 

8,278,493

 

 


(*) Used to calculate the present value of the loans.

 

6.2                              Fair value measurement of derivative financial instruments (including embedded derivative)

 

The Company estimates the fair value of its derivative financial instruments and acknowledges that it may differ from the amounts payable/receivable in the event of early settlement of the instrument. This difference results from factors such as liquidity, spreads or the intention of early settlement from the counterparty, among others. The amounts estimated by management are also compared with the Mark-to-Market (MtM) provided as reference by the banks (counterparties) and with the estimates performed by an independent financial advisor.

 

A summary of the methodologies used for purposes of determining fair value by type of instrument is presented below.

 

·             Swap contracts - the present value of both the asset and liability legs are estimated through the discount of forecasted cash flows using the observed market interest rate for the currency in which the swap is denominated, considering both of Fibria’s and counterpart credit risk. The contract fair value is the difference between the asset and liability.

 

17



 

Fibria Celulose S.A.

 

Notes to the unaudited consolidated interim
financial information at June 30, 2015

In thousands of Reais, unless otherwise indicated

 

·             Options (Zero Cost Collar) - the fair value was calculated based on the Garman-Kohlhagen model, considering both of Fibria’s and counterpart credit risk. Volatility information and interest rates are observable and obtained from BM&FBOVESPA exchange information to calculate the fair values.

 

·             Swap US-CPI - the cash flow of the liability position is projected using the yield of the US-CPI index, obtained through the implicit rates in the American titles indexed to the inflation rate (TIPS), issued by the Bloomberg. The cash flow of the asset position is projected using the fixed rate established in the embedded derivative instrument. The fair value of the embedded derivative instrument is the present value of the difference between both positions.

 

The yield curves used to calculate the fair value in June 30, 2015 are as follows:

 

Interest rate curves

 

 

 

 

 

Brazil

 

United States

 

Dollar coupon

 

Vertex

 

Rate (p.a.) - %

 

Vertex

 

Rate (p.a.) - %

 

Vertex

 

Rate (p.a.) - %

 

1M

 

13.68

 

1M

 

0.20

 

1M

 

15.76

 

6M

 

14.24

 

6M

 

0.35

 

6M

 

3.80

 

1Y

 

14.27

 

1Y

 

0.52

 

1Y

 

3.05

 

2Y

 

13.60

 

2Y

 

0.91

 

2Y

 

3.07

 

3Y

 

13.07

 

3Y

 

1.27

 

3Y

 

3.17

 

5Y

 

12.72

 

5Y

 

1.81

 

5Y

 

3.60

 

10Y

 

12.58

 

10Y

 

2.52

 

10Y

 

4.07

 

 

7                                        Cash and cash equivalents

 

 

 

Average
yield p.a. - %

 

June 30,
2015

 

December 31,
2014

 

 

 

 

 

 

 

 

 

Cash and banks

 

 

 

200,832

 

122,515

 

Fixed-term deposits

 

 

 

 

 

 

 

Local currency

 

 

 

2,804

 

157,883

 

Foreign currency

 

0.16

 

480,900

 

180,669

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

 

 

684,536

 

461,067

 

 

The increase of R$ 223,469 in the six-month period ended June 30, 2015 refers, mainly, to our strategy of keeping cash balance available with higher liquidity.

 

18



 

Fibria Celulose S.A.

 

Notes to the unaudited consolidated interim
financial information at June 30, 2015

In thousands of Reais, unless otherwise indicated

 

8                                        Marketable securities

 

 

 

Average
yield p.a.- %

 

June 30,
2015

 

December 31,
2014

 

 

 

 

 

 

 

 

 

In local currency

 

 

 

 

 

 

 

Brazilian federal provision fund

 

75 of CDI

 

235

 

30

 

Brazilian federal government securities

 

 

 

 

 

 

 

At fair value

 

109.8 of CDI

 

105,430

 

193,101

 

Held to maturity (i)

 

109.8 of CDI and 6

 

77,997

 

51,350

 

Private securities

 

101.7 of CDI

 

589,217

 

428,336

 

 

 

 

 

 

 

 

 

In foreign currency

 

 

 

 

 

 

 

Private securities

 

 

 

 

 

61,352

 

 

 

 

 

 

 

 

 

Marketable securities

 

 

 

772,879

 

734,169

 

 

 

 

 

 

 

 

 

Current

 

 

 

701,361

 

682,819

 

 

 

 

 

 

 

 

 

Non-Current

 

 

 

71,518

 

51,350

 

 


(i)        The yield of 109.8% of CDI refers to the investment fund - Pulp and the yield of 6% p.a. refers to the agrarian debt bounds.

 

19



 

Fibria Celulose S.A.

 

Notes to the unaudited consolidated interim
financial information at June 30, 2015

In thousands of Reais, unless otherwise indicated

 

9                                        Derivative financial instruments (including embedded derivative)

 

(a)                                Derivative financial instruments by type

 

 

 

Reference value (notional)
- in U.S. Dollars

 

Fair value

 

Type of derivative

 

June 30,
2015

 

December 31,
2014

 

June 30,
2015

 

December 31,
2014

 

 

 

 

 

 

 

 

 

 

 

Instruments contracted of economic hedge strategy

 

 

 

 

 

 

 

 

 

Operational hedge

 

 

 

 

 

 

 

 

 

Cash flow hedges of exports

 

 

 

 

 

 

 

 

 

Zero cost collar

 

920,000

 

1,465,000

 

(24,787

)

(19,443

)

 

 

 

 

 

 

 

 

 

 

Hedges of debts

 

 

 

 

 

 

 

 

 

Hedges of interest rates

 

 

 

 

 

 

 

 

 

Swap LIBOR x Fixed (US$)

 

530,557

 

538,207

 

(10,822

)

3,353

 

 

 

 

 

 

 

 

 

 

 

Hedges of foreign currency

 

 

 

 

 

 

 

 

 

Swap DI x US$ (US$)

 

396,767

 

405,269

 

(398,895

)

(215,654

)

Swap TJLP x US$ (US$)

 

134,742

 

180,771

 

(208,419

)

(196,818

)

Swap Pre x US$ (US$)

 

150,964

 

191,800

 

(146,399

)

(109,889

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(789,322

)

(538,451

)

 

 

 

 

 

 

 

 

 

 

Embedded derivative in forestry partnership and standing timber supply agreements (*)

 

 

 

 

 

 

 

 

 

Swap changes in US-CPI

 

879,989

 

902,267

 

150,007

 

120,988

 

 

 

 

 

 

 

 

 

 

 

Classified

 

 

 

 

 

 

 

 

 

In current assets

 

 

 

 

 

26,338

 

29,573

 

In non-current assets

 

 

 

 

 

175,026

 

161,320

 

In current liabilities

 

 

 

 

 

(247,662

)

(185,872

)

In non-current liabilities

 

 

 

 

 

(593,017

)

(422,484

)

 

 

 

 

 

 

 

 

 

 

Total, net

 

 

 

 

 

(639,315

)

(417,463

)

 


(*) The embedded derivative is a swap of the US-CPI variations during the term of the Forestry Partnership and Standing Timber Supply Agreements.

 

20



 

Fibria Celulose S.A.

 

Notes to the unaudited consolidated interim
financial information at June 30, 2015

In thousands of Reais, unless otherwise indicated

 

(b)                                Derivative financial instruments of economic hedge strategy by type and broken down by nature of the exposure

 

 

 

Reference value (notional) -
in currency of origin

 

Fair value

 

Type of derivative and
protected risk

 

June 30,
2015

 

December 31,
2014

 

June 30,
2015

 

December 31,
2014

 

 

 

 

 

 

 

 

 

 

 

Swap contracts - Hedges of debts

 

 

 

 

 

 

 

 

 

Asset

 

 

 

 

 

 

 

 

 

USD LIBOR (LIBOR to fixed)

 

530,557

 

538,207

 

1,582,195

 

1,352,345

 

BRL fixed rate (BRL to USD)

 

771,874

 

788,208

 

1,112,327

 

1,082,215

 

BRL TJLP (BRL to USD)

 

218,953

 

293,676

 

209,759

 

279,328

 

BRL Pre (BRL to USD)

 

313,869

 

395,697

 

255,636

 

323,898

 

Liability

 

 

 

 

 

 

 

 

 

USD fixed rate (LIBOR to fixed)

 

530,557

 

538,207

 

(1,593,017

)

(1,348,992

)

USD fixed rate (BRL to USD)

 

396,767

 

405,269

 

(1,511,222

)

(1,297,868

)

USD fixed rate (BRL TJLP to USD)

 

134,742

 

180,771

 

(418,178

)

(476,146

)

USD fixed rate (BRL to USD)

 

150,964

 

191,800

 

(402,035

)

(433,788

)

 

 

 

 

 

 

 

 

 

 

Total of swap contracts

 

 

 

 

 

(764,535

)

(519,008

)

 

 

 

 

 

 

 

 

 

 

Options

 

 

 

 

 

 

 

 

 

Cash flow hedge - zero cost collar

 

920,000

 

1,465,000

 

(24,787

)

(19,443

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(789,322

)

(538,451

)

 

(c)                                 Derivative financial instruments by type of economic hedge strategy contracts

 

 

 

Fair value

 

Amount paid

 

Type of derivative

 

June 30,
2015

 

December 31,
2014

 

June 30,
2015

 

December 31,
2014

 

 

 

 

 

 

 

 

 

 

 

Operational hedges

 

 

 

 

 

 

 

 

 

Cash flow hedges of exports

 

(24,787

)

(19,443

)

(5,879

)

(13

)

Hedges of debts

 

 

 

 

 

 

 

 

 

Hedges of interest rates

 

(10,822

)

3,353

 

(2,210

)

(5.445

)

Hedges of foreign currency

 

(753,713

)

(522,361

)

(89,033

)

(47.641

)

 

 

 

 

 

 

 

 

 

 

 

 

(789,322

)

(538,451

)

(97,122

)

(53.099

)

 

21



 

Fibria Celulose S.A.

 

Notes to the unaudited consolidated interim
financial information at June 30, 2015

In thousands of Reais, unless otherwise indicated

 

(d)                                Fair value and counterparty by maturity date of economic hedge strategy contracts

 

Fair values by maturity:

 

 

 

June 30,
2015

 

December 31,
2014

 

 

 

 

 

 

 

2015

 

(145,980

)

(158,095

)

2016

 

(166,647

)

(99,947

)

2017

 

(235,578

)

(134,814

)

2018

 

(160,991

)

(87,208

)

2019

 

(49,516

)

(35,401

)

2020

 

(30,610

)

(22,986

)

 

 

 

 

 

 

 

 

(789,322

)

(538,451

)

 

Notional and fair value by counterparty:

 

 

 

June 30, 2015

 

December 31, 2014

 

 

 

Notional – in
U.S. Dollars

 

Fair value

 

Notional – in
U.S. Dollars

 

Fair value

 

 

 

 

 

 

 

 

 

 

 

Banco Itaú BBA S.A.

 

362,363

 

(116,960

)

603,906

 

(67,675

)

Deutsche Bank S.A.

 

175,900

 

(1,137

)

253,450

 

12

 

Banco CreditAgricole Brasil S.A.

 

55,985

 

(9,239

)

68,623

 

(10,085

)

Banco Citibank S.A.

 

78,955

 

(44,277

)

45,671

 

(48,612

)

Bank of America Merrill Lynch

 

300,000

 

(10,178

)

300,000

 

(1,385

)

Banco Santander Brasil S.A.

 

151,629

 

(109,640

)

196,987

 

(95,818

)

Banco Safra S.A.

 

193,326

 

(231,495

)

198,598

 

(132,726

)

Banco BNP Paribas Brasil S.A.

 

45,000

 

(1

)

210,000

 

(1,741

)

HSBC Bank Brasil S.A.

 

90,454

 

(46,686

)

160,446

 

(40,675

)

Banco Bradesco S.A.

 

180,625

 

(201,320

)

182,229

 

(126,785

)

Banco J. P. Morgan S.A.

 

427,856

 

(10,728

)

467,857

 

(3,446

)

Goldman Sachs do Brasil

 

40,000

 

(824

)

65,000

 

(1,007

)

Banco Votorantim S.A.

 

25,937

 

(6,723

)

13,280

 

(8,237

)

Morgan Stanley & CO.

 

5,000

 

(114

)

15,000

 

(271

)

 

 

 

 

 

 

 

 

 

 

 

 

2,133,030

 

(789,322

)

2,781,047

 

(538,451

)

 

Fair value does not necessarily represent the cash required to immediately settle each contract, as such disbursement will only be made on the date of maturity of each transaction, when the final settlement amount will be determined.

 

The outstanding contracts at June 30, 2015 are not subject to margin calls or anticipated liquidation clauses resulting from mark-to-market variations. All operations are over-the-counter and registered at CETIP (a clearing house).

 

22



 

Fibria Celulose S.A.

 

Notes to the unaudited consolidated interim
financial information at June 30, 2015

In thousands of Reais, unless otherwise indicated

 

10                                 Trade accounts receivable

 

 

 

June 30,
2015

 

December 31,
2014

 

 

 

 

 

 

 

Domestic customers

 

77,307

 

50,729

 

Export customers

 

621,779

 

496,493

 

 

 

 

 

 

 

 

 

699,086

 

547,222

 

 

 

 

 

 

 

Allowance for doubtful accounts

 

(7,593

)

(8,798

)

 

 

 

 

 

 

 

 

691,493

 

538,424

 

 

In the six-month period ended June 30, 2015, we made some factoring transactions without recourse for certain customers’ receivables, in the amount of R$ 1,281,310 (R$ 1,230,143 at December 31, 2014), that were derecognized from accounts receivable in the balance sheet.

 

11                                 Inventory

 

 

 

June 30,
2015

 

December 31,
2014

 

 

 

 

 

 

 

Finished goods

 

 

 

 

 

At plants/warehouses in Brazil

 

165,854

 

137,741

 

Outside Brazil

 

695,933

 

515,522

 

Work in process

 

14,946

 

16,942

 

Raw materials

 

414,616

 

402,293

 

Supplies

 

159,408

 

161,758

 

Imports in transit

 

3,578

 

3,873

 

Advances to suppliers

 

373

 

664

 

 

 

 

 

 

 

 

 

1,454,708

 

1,238,793

 

 

23



 

Fibria Celulose S.A.

 

Notes to the unaudited consolidated interim
financial information at June 30, 2015

In thousands of Reais, unless otherwise indicated

 

12                                 Recoverable taxes

 

 

 

June 30,
2015

 

December 31,
2014

 

 

 

 

 

 

 

Current

 

 

 

 

 

 

 

 

 

 

 

Withholding tax and prepaid Income Tax (IRPJ) and Social Contribution (CSLL)

 

776,525

 

680,927

 

Value-added Tax on Sales and Services (ICMS) on purchases of property, plant and equipment

 

19,198

 

19,465

 

Value-added Tax on Sales and Services (ICMS and IPI) on purchases of raw materials and supplies

 

940,975

 

896,460

 

Federal tax credits

 

404,506

 

444,906

 

Credit related to Reintegra Program (a)

 

67,152

 

37,027

 

Social Integration Program (PIS) and Social Contribution on Revenue (COFINS) Recoverable

 

600,144

 

570,333

 

Provision for the impairment of ICMS credits

 

(767,614

)

(734,154

)

 

 

 

 

 

 

 

 

2,040,886

 

1,914,964

 

 

 

 

 

 

 

Current

 

183,306

 

162,863

 

 

 

 

 

 

 

Non-current

 

1,857,580

 

1,752,101

 

 

During the six-month period ended June 30, 2015, there were no relevant changes to our expectations regarding the recoverability of the tax credits presented in this note and the Note 14 to the most recent annual financial statements.

 

(a)                                Reintegra Special Tax Regime

 

Fibria is beneficiary of the Special Tax Refund Regime for Exporting Companies (known as Reintegra), established by Provisional Measure nº 651/2014 (enacted as Law 13.043/2014 on November 13, 2014),

 

With the issuance of the Act nº 8,415, on February 27, 2015, the percentage to be applied over the export revenue for calculation of the tax credit was changed from 3% to 1% between March 1, 2015 and December 31, 2016. In 2017, the percentage to be used will be 2% and in 2018, 3% over the export revenue.

 

In the six-month period ended June 30, 2015, the Company recognized Reintegra credits of R$ 39,060, under “Cost of sales” in the Statement of profit and loss.

 

13                                 Income taxes

 

The Company and the subsidiaries located in Brazil are taxed based on their taxable income. The subsidiaries located outside of Brazil use methods established by the respective local jurisdictions. Income taxes have been calculated and recorded considering the applicable statutory tax rates enacted at the date of the interim financial information.

 

The Company pays income taxes on the profits generated by foreign subsidiaries in accordance with the Law 12,973/14, which revoked the Article 74 of Provisional Measure 2,158/01, but kept the determination that the profits earned each year by foreign controlled subsidiaries are subject to the payment of income tax and social contribution in Brazil in the same year, at a rate of 34%, applied to the subsidiaries’ accounting profits before income tax. The repatriation of these profits in subsequent years is not subject to future taxation in Brazil. The Company records a provision for income taxes on foreign subsidiaries on an accruals basis. As from 2014, the Company decided to start paying these taxes primarily to mitigate any risk of future tax assessments on this matter.

 

24



 

Fibria Celulose S.A.

 

Notes to the unaudited consolidated interim
financial information at June 30, 2015

In thousands of Reais, unless otherwise indicated

 

(a)                                Deferred taxes

 

 

 

June 30,
2015

 

December 31,
2014

 

 

 

 

 

 

 

Tax loss carryforwards (i)

 

245,035

 

192,647

 

Provision for contingencies

 

107,663

 

111,799

 

Sundry provisions (impairment, operational and other)

 

484,855

 

447,273

 

Results of derivative contracts - cash basis for tax purposes

 

217,368

 

141,938

 

Exchange losses (net) - cash basis for tax purposes

 

1,427,813

 

913,219

 

Tax amortization of the assets acquired in the business combination - Aracruz

 

101,134

 

102,335

 

Actuarial gains on medical assistance plan (SEPACO)

 

6,609

 

6,609

 

Provision for income tax and social contribution from foreign subsidiaries

 

(327,950

)

(25,977

)

Tax accelerated depreciation

 

(8,406

)

(9,889

)

Reforestation costs already deducted for tax purposes

 

(359,157

)

(348,398

)

Fair values of biological assets

 

(139,658

)

(153,020

)

Effects of business combination - acquisition of Aracruz

 

(1,004

)

(3,165

)

Tax benefit of goodwill - goodwill not amortized for accounting purposes

 

(492,023

)

(447,293

)

Other provisions

 

(7,640

)

(3,770

)

 

 

 

 

 

 

Total deferred taxes asset, net

 

1,254,639

 

924,308

 

 

 

 

 

 

 

Deferred taxes - asset (net by entity)

 

1,511,358

 

1,190,836

 

 

 

 

 

 

 

Deferred taxes - liability (net by entity)

 

256,719

 

266,528

 

 


(i)        The balance as at June 30, 2015 is presented net of Hungarian Forint HUF 25,752 million (equivalent to R$ 282,314 as of June 30, 2015 and R$ 263,297 as of December 31, 2014) related to the provision for impairment for foreign tax credits.

 

Changes in the net balance of deferred income tax are as follows:

 

 

 

June 30,
2015

 

December 31,
2014

 

 

 

 

 

 

 

At the beginning of the period

 

924,308

 

732,220

 

Tax loss carryforwards

 

52,388

 

20,128

 

Temporary differences regarding provisions

 

33,446

 

23,261

 

Provision for income tax and social contribution from foreign subsidiaries

 

(301,973

)

(25,977

)

Derivative financial instruments taxed on a cash basis

 

75,430

 

(15,933

)

Amortization of goodwill

 

(45,931

)

(98,063

)

Reforestation costs

 

(9,276

)

(36,804

)

Exchange losses (net) taxed on a cash basis

 

514,594

 

266,933

 

Fair value of biological assets

 

13,362

 

46,841

 

Actuarial losses on medical assistance plan (SEPACO)

 

 

 

2,478

 

Other

 

(1,709

)

9,224

 

 

 

 

 

 

 

At the end of the period

 

1,254,639

 

924,308

 

 

25



 

Fibria Celulose S.A.

 

Notes to the unaudited consolidated interim
financial information at June 30, 2015

In thousands of Reais, unless otherwise indicated

 

(b)                                Reconciliation of taxes on income

 

 

June 30,
2015

 

June 30,
2014

 

 

 

 

 

 

 

Income (loss) before tax

 

(201,192

)

1,021,866

 

 

 

 

 

 

 

Income tax and social contribution benefit (expense) at statutory nominal rate - 34%

 

68,405

 

(347,434

)

 

 

 

 

 

 

Reconciliation to effective expense:

 

 

 

 

 

 

 

 

 

 

 

Benefits to directors

 

(6,067

)

(3,335

)

Equity in net income of jointly-venture

 

255

 

 

 

Taxes on earnings of foreign subsidiaries

 

 

 

(3,484

)

Difference in tax rates of foreign subsidiaries

 

(7

)

12,987

 

Credit of Reintegra Program

 

13,281

 

 

 

Benefit - Tax on net income (Imposto sobre o Lucro Líquido - ILL)

 

 

 

32,117

 

Foreign exchange effects on foreign subsidiaries (i)

 

180,550

 

(62,375

)

Other, mainly non-deductible provisions

 

(6,797

)

60

 

 

 

 

 

 

 

Income tax and social contribution benefit (expense) for the period

 

249,620

 

(371,464

)

 

 

 

 

 

 

Income tax and social contribution — current

 

(78,601

)

(101,390

)

 

 

 

 

 

 

Income tax and social contribution — deferred

 

328,221

 

(270,074

)

 

 

 

 

 

 

 

 

249,620

 

(371,464

)

 

 

 

 

 

 

Effective rate - %

 

124.1

 

36.4

 

 


(i)        Relates to net foreign exchange gains recognized by our foreign subsidiaries that use the real as the functional currency. As the real is not used for tax purposes in the foreign country this net foreign exchange gain is not recognized for tax purposes in the foreign country nor will it ever be subject to tax in Brazil.

 

14                                 Significant transactions and balances with related parties

 

(a)                                Related parties

 

The Company is governed by a Shareholders Agreement entered into between Votorantim Industrial S.A. (“VID”), which holds 29.42% of our shares, and BNDES Participações S.A. (“BNDESPAR”), which holds 30.38% of our shares (together the “Controlling Shareholders”).

 

The Company’s commercial and financial transactions with its subsidiaries, companies of the Votorantim Group and other related parties are carried out at normal market prices and conditions, based on usual terms and rates applicable to third parties.

 

In Abril 2015, the subsidiary Fibria-MS made a marketable security investment with Banco Votorantim, maturing in Abril 2016 and average interest rate of 102.1% of CDI.

 

26



 

Fibria Celulose S.A.

 

Notes to the unaudited consolidated interim
financial information at June 30, 2015

In thousands of Reais, unless otherwise indicated

 

In the six-month period ended June 30, 2015, except for the transaction mentioned above, there were no changes in the terms of the contracts, agreements and transactions, and there were no new contracts, agreements or transactions with distinct nature between the Company and its related parties when compared to the transactions disclosed in Note 16 to the most recent financial statements as at December 31, 2014.

 

(i)                                   Balances recognized in assets and liabilities

 

 

 

Balances receivable (payable)

 

 

 

Nature

 

June 30,
2015

 

December 31,
2014

 

 

 

 

 

 

 

 

 

Transactions with controlling shareholders

 

 

 

 

 

 

 

Votorantim Industrial S.A.

 

Rendering of services

 

(28

)

(172

)

Banco Nacional de Desenvolvimento Econômico e Social (BNDES)

 

Financing

 

(1,706,742

)

(1,756,133

)

 

 

 

 

 

 

 

 

 

 

 

 

(1,706,770

)

(1,756,305

)

 

 

 

 

 

 

 

 

Transactions with Votorantim Group companies

 

 

 

 

 

 

 

Votorantim Participações S.A.

 

Financing

 

9,308

 

7,969

 

Votener - Votorantim Comercializadora e Energia

 

Energy supplier

 

8,915

 

20,719

 

Banco Votorantim S.A.

 

Marketable securities

 

30,645

 

 

 

Banco Votorantim S.A.

 

Financial instruments

 

(6,723

)

(8,237

)

Votorantim Cimentos S.A.

 

Input supplier

 

(241

)

(269

)

Votorantim Metais

 

Chemical products supplier

 

(230

)

 

 

Votorantim Metais

 

Leasing of land

 

 

 

(773

)

Companhia Brasileira de Alumínio (CBA)

 

Leasing of land

 

(39

)

(39

)

 

 

 

 

 

 

 

 

 

 

 

 

41,635

 

19,370

 

 

 

 

 

 

 

 

 

Net

 

 

 

(1,665,135

)

(1,736,935

)

 

 

 

 

 

 

 

 

Presented in the following lines

 

 

 

 

 

 

 

In assets

 

 

 

 

 

 

 

Marketable securities (Note 8)

 

 

 

30,645

 

 

 

Related parties - non-current

 

 

 

9,308

 

7,969

 

Other assets - current

 

 

 

8,915

 

20,719

 

In liabilities

 

 

 

 

 

 

 

Loans and financing (Note 19)

 

 

 

(1,706,742

)

(1,756,133

)

Derivative financial instruments (Note 9)

 

 

 

(6,723

)

(8,237

)

Suppliers

 

 

 

(538

)

(1,253

)

 

 

 

 

 

 

 

 

 

 

 

 

(1,665,135

)

(1,736,935

)

 

27



 

Fibria Celulose S.A.

 

Notes to the unaudited consolidated interim
financial information at June 30, 2015

In thousands of Reais, unless otherwise indicated

 

(ii)                               Transactions recognized in the Statement of profit and loss

 

 

 

Income (expense)

 

 

 

Nature

 

June 30,
2015

 

June 30,
2014

 

 

 

 

 

 

 

 

 

Transactions with controlling shareholders

 

 

 

 

 

 

 

Votorantim Industrial S.A.

 

Rendering of services

 

(4,647

)

(6,661

)

Banco Nacional de Desenvolvimento Econômico e Social (BNDES)

 

Financing

 

(149,166

)

(40,311

)

 

 

 

 

 

 

 

 

 

 

 

 

(153,813

)

(46,972

)

 

 

 

 

 

 

 

 

Transactions with associates

 

 

 

 

 

 

 

Bahia Produtos de Madeira S.A.

 

Sales of wood

 

 

 

4,647

 

 

 

 

 

 

 

 

 

Transactions with Votorantim Group companies

 

 

 

 

 

 

 

Votorantim Participações S.A.

 

Financing

 

1,339

 

 

 

Votener - Votorantim Comercializadora de Energia

 

Energy supplier

 

49,380

 

23,207

 

Banco Votorantim S.A.

 

Marketable securities

 

666

 

 

 

Banco Votorantim S.A.

 

Financial instruments

 

1,514

 

 

 

Votorantim Cimentos S.A.

 

Energy supplier

 

3,104

 

3,654

 

Votorantim Cimentos S.A.

 

Input supplier

 

(43

)

(2,479

)

Sitrel Siderurgia Três Lagoas

 

Energy supplier

 

1,773

 

1,633

 

Votorantim Metais Ltda.

 

Chemical products supplier

 

(1,862

)

(87

)

Votorantim Metais Ltda.

 

Leasing of lands

 

(2,318

)

(4,503

)

Companhia Brasileira de Alumínio (CBA)

 

Leasing of lands

 

(235

)

(221

)

 

 

 

 

 

 

 

 

 

 

 

 

53,318

 

21,204

 

 

(b)                                Key management compensation

 

The remuneration effects on the statement of profit or loss, including all benefits, are summarized as follows:

 

 

 

June 30,
2015

 

June 30,
2014

 

 

 

 

 

 

 

Benefits to officers and directors

 

23,968

 

20,675

 

Benefit program - Phantom Stock Options and Stock Options plans

 

4,893

 

(1,333

)

 

 

 

 

 

 

 

 

28,861

 

19,342

 

 

Benefits include fixed compensation (salaries and fees, vacation pay and 13th month salary), social charges and contributions to the National Institute of Social Security (INSS), the Government Severance Indemnity Fund for Employees (FGTS) and the variable compensation program.

 

Benefits to key management do not include the compensation for the Statutory Audit Committee, Finance, Compensation and Sustainability Committees’ members of R$ 577 for the six-month period ended June 30, 2015 (R$ 819 for the six-month period ended June 30, 2014).

 

28



 

Fibria Celulose S.A.

 

Notes to the unaudited consolidated interim
financial information at June 30, 2015

In thousands of Reais, unless otherwise indicated

 

The Company does not have any additional post-employment active plan and does not offer any other benefits, such as additional paid leave for time of service.

 

The balances to be paid to the Company’s key management are recorded in the following lines items of the current and non-current liabilities and in the shareholders’ equity:

 

 

 

June 30,
2015

 

December 31,
2014

 

 

 

 

 

 

 

Current liability

 

 

 

 

 

Payroll, profit sharing and related charges

 

11,710

 

18,748

 

 

 

 

 

 

 

Non-current liability

 

 

 

 

 

Other payables

 

25,281

 

13,665

 

 

 

 

 

 

 

Shareholders’ equity

 

 

 

 

 

Capital reserve

 

2,860

 

918

 

 

 

 

 

 

 

 

 

39,851

 

33,331

 

 

15                                 Investments

 

 

 

June 30,
2015

 

December 31,
2014

 

 

 

 

 

 

 

Investment in associate and joint-venture - equity method (i)

 

14,737

 

13,987

 

Impairment of investments (i)

 

(13,629

)

(13,629

)

Other investments - at fair value (ii)

 

94,055

 

79,524

 

 

 

 

 

 

 

 

 

95,163

 

79,882

 

 


(i)    On July 31, 2014, the Company acquired 100% of the capital of WOP - Wood Participações Ltda. (former Weyerhaeuser Brasil Participações Ltda.), for R$ 6,716, which held 66.67% of the capital of our associate Bahia Produtos de Madeira S.A. As from that date, the Company holds, directly and indirectly, 100% of the capital of Bahia Produtos de Madeira S.A. We recognized provision for impairment in these subsidiaries.

 

(ii)   Fair value change in our interest in Ensyn was not significant in the six-month period ended June 30, 2015. The increase in the balance refers to the foreign currency effect on the investment.

 

None of the subsidiaries and jointly-operated entities has publicly traded shares.

 

The provisions and contingent liabilities related to the entities of the Company are described in Note 20.

 

Additionally, the Company does not have any significant restriction or commitments with regards to its associates and joint-venture.

 

29



 

Fibria Celulose S.A.

 

Notes to the unaudited consolidated interim
financial information at June 30, 2015

In thousands of Reais, unless otherwise indicated

 

Incorporation of subsidiary

 

In January 2015, the Company concluded the process of incorporation of the subsidiary Fibria Innovations LLC., located in Vancouver - Canada, whose purpose is the research and development of bio-products from biomass.

 

16                                 Biological assets

 

 

 

June 30,
2015

 

December 31, 
2014

 

 

 

 

 

 

 

At the beginning of the period

 

 

 

 

 

Historical cost

 

3,172,431

 

2,730,510

 

Fair value - step up

 

535,414

 

692,924

 

 

 

3,707,845

 

3,423,434

 

 

 

 

 

 

 

Additions

 

612,706

 

1,190,349

 

Harvests in the period

 

 

 

 

 

Historical cost

 

(442,570

)

(749,986

)

Fair value

 

(84,309

)

(209,265

)

Change in fair value - step up

 

29,831

 

51,755

 

Reversal of disposals (disposals)

 

 

 

1,817

 

Transfer (i)

 

(13,210

)

(259

)

 

 

 

 

 

 

At the end of the period

 

3,810,293

 

3,707,845

 

Historical cost

 

3,329,357

 

3,172,431

 

Fair value - step up

 

480,936

 

535,414

 

 


(i) Includes transfers between biological assets and property, plant and equipment.

 

In accordance with our accounting policies, in the six-month period ended June 30, 2015 we performed a valuation of the biological assets at their fair value. In the following table we present the main inputs used to estimate the fair value of biological assets:

 

 

 

June 30,
2015

 

December 31,
2014

 

 

 

 

 

 

 

Actual planted area (hectare)

 

452,937

 

459,487

 

Average annual growth (IMA) - m3/hectare

 

40

 

40

 

Net average sale price - R$/m3

 

64.83

 

62.78

 

Remuneration of own contributory assets - %

 

5.6

 

5.6

 

Discount rate - %

 

6.43

 

6.65

 

 

30



 

Fibria Celulose S.A.

 

Notes to the unaudited consolidated interim
financial information at June 30, 2015

In thousands of Reais, unless otherwise indicated

 

The changes in the fair value of the biological assets in June 30, 2015 are presented as follows:

 

 

 

June 30,
2015

 

December 31,
2014

 

 

 

 

 

 

 

Fair value of the forest renovations during the year

 

(73,355

)

(197,088

)

Growing of plantation (IMA, area and age)

 

43,453

 

69,153

 

Variations in price

 

59,733

 

179,690

 

 

 

 

 

 

 

 

 

29,831

 

51,755

 

 

The biological assets are classified within Level 3 of the fair value hierarchical level. There were no transfers between levels during the periods presented.

 

31



 

Fibria Celulose S.A.

 

Notes to the unaudited consolidated interim
financial information at June 30, 2015

In thousands of Reais, unless otherwise indicated

 

17                                 Property, plant and equipment

 

 

 

Land

 

Buildings

 

Machinery,
equipment
and facilities

 

Advances to
suppliers

 

Construction
in progress

 

Other

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

At December 31, 2013

 

1,249,332

 

1,426,592

 

6,902,717

 

24,317

 

191,029

 

30,517

 

9,824,504

 

Additions

 

 

 

18

 

6,325

 

(18,912

)

360,348

 

1,715

 

349,494

 

Disposals

 

(57,202

)

(10,140

)

(44,467

)

(3,726

)

 

 

(11,306

)

(126,841

)

Depreciation

 

 

 

(128,368

)

(657,191

)

 

 

 

 

(12,081

)

(797,640

)

Transfers and others (*)

 

8,382

 

70,614

 

250,403

 

66

 

(335,495

)

9,246

 

3,216

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

At December 31, 2014

 

1,200,512

 

1,358,716

 

6,457,787

 

1,745

 

215,882

 

18,091

 

9,252,733

 

Additions

 

 

 

135

 

1,136

 

5,515

 

131,693

 

401

 

138,880

 

Disposals

 

(3,485

)

(2,414

)

(2,483

)

 

 

 

 

(697

)

(9,079

)

Depreciation

 

 

 

(56,202

)

(328,999

)

 

 

 

 

(7,035

)

(392,236

)

Acquisition of assets - Fibria Innovations (Note 15)

 

 

 

 

 

4,212

 

 

 

 

 

 

 

4,212

 

Transfers and others (*)

 

 

 

28,154

 

66,346

 

321

 

(116,280

)

34,069

 

12,610

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

At June 30, 2015

 

1,197,027

 

1,328,389

 

6,197,999

 

7,581

 

231,295

 

44,829

 

9,007,120

 

 


(*) Includes transfers between property, plant and equipment, biological assets, intangible assets and inventory.

 

32



 

Fibria Celulose S.A.

 

Notes to the unaudited consolidated interim
financial information at June 30, 2015

In thousands of Reais, unless otherwise indicated

 

18                                 Intangible assets

 

 

 

June 30,
2015

 

December 31,
2014

 

 

 

 

 

 

 

At the beginning of the period

 

4,552,103

 

4,634,265

 

Additions

 

7

 

40

 

Amortization

 

(40,734

)

(90,854

)

Disposals

 

(66

)

(20

)

Acquisition of assets - Fibria Innovations (Note 15)

 

7,388

 

 

 

Transfers and others (*)

 

2,239

 

8,672

 

 

 

 

 

 

 

At the end of the period

 

4,520,937

 

4,552,103

 

 

 

 

 

 

 

Composed by

 

 

 

 

 

Goodwill - Aracruz

 

4,230,450

 

4,230,450

 

Systems development and deployment

 

20,185

 

26,703

 

Acquired from business combination

 

 

 

 

 

Databases

 

159,600

 

182,400

 

Patents

 

 

 

5,160

 

Relationships with suppliers

 

 

 

 

 

Chemical products

 

97,969

 

103,125

 

Other

 

12,733

 

4,265

 

 

 

 

 

 

 

 

 

4,520,937

 

4,552,103

 

 


(*) Includes transfers between property, plant and equipment and intangible assets.

 

33



 

Fibria Celulose S.A.

 

Notes to the unaudited consolidated interim

financial information at June 30, 2015

In thousands of Reais, unless otherwise indicated

 

19                                 Loans and financing

 

(a)                                Breakdown of the balance by type of loan

 

 

 

 

 

Average
annual

 

Current

 

Non- current

 

Total

 

Type/purpose

 

Interest
rate

 

interest
rate - %

 

June 30,
2015

 

December 31,
2014

 

June 30,
2015

 

December 31,
2014

 

June 30,
2015

 

December 31,
2014

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

In foreign currency

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BNDES

 

UMBNDES

 

6.4

 

68,770

 

62,307

 

489,003

 

409,594

 

557,773

 

471,901

 

Bonds

 

Fixed

 

5.6

 

12,550

 

11,154

 

2,132,434

 

1,825,189

 

2,144,984

 

1,836,343

 

Export credits (prepayment)

 

LIBOR

 

2.9

 

279,245

 

190,707

 

3,958,748

 

3,518,474

 

4,237,993

 

3,709,181

 

Export credits (ACC/ACE)

 

Fixed

 

1.1

 

153,099

 

263,120

 

 

 

 

 

153,099

 

263,120

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

513,664

 

527,288

 

6,580,185

 

5,753,257

 

7,093,849

 

6,280,545

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

In Reais

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BNDES

 

TJLP

 

9.3

 

254,209

 

320,838

 

785,746

 

870,720

 

1,039,955

 

1,191,558

 

BNDES

 

Fixed

 

4.4

 

22,547

 

16,654

 

86,467

 

76,020

 

109,014

 

92,674

 

FINAME

 

TJLP and Fixed

 

4.0

 

4,394

 

4,978

 

3,549

 

5,451

 

7,943

 

10,429

 

NCE

 

CDI

 

13.9

 

87,037

 

83,507

 

646,435

 

630,742

 

733,472

 

714,249

 

Midwest Region Fund (FCO and FINEP)

 

Fixed

 

8.1

 

12,080

 

12,124

 

18,993

 

24,940

 

31,073

 

37,064

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

380,267

 

438,101

 

1,541,190

 

1,607,873

 

1,921,457

 

2,045,974

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

893,931

 

965,389

 

8,121,375

 

7,361,130

 

9,015,306

 

8,326,519

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest

 

 

 

 

 

60,881

 

51,957

 

91,898

 

65,710

 

152,779

 

117,667

 

Short-term borrowing

 

 

 

 

 

153,100

 

262,739

 

 

 

 

 

153,100

 

262,739

 

Long-term borrowing

 

 

 

 

 

679,950

 

650,693

 

8,029,477

 

7,295,420

 

8,709,427

 

7,946,113

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

893,931

 

965,389

 

8,121,375

 

7,361,130

 

9,015,306

 

8,326,519

 

 

The average rates were calculated based on the forward yield curve of benchmark rates to which the loans are indexed, weighted through the maturity date for each installment, including the issuing/contracting costs, when applicable.

 

34



 

Fibria Celulose S.A.

 

Notes to the unaudited consolidated interim

financial information at June 30, 2015

In thousands of Reais, unless otherwise indicated

 

(b)                                Breakdown by maturity

 

 

 

2016

 

2017

 

2018

 

2019

 

2020

 

2021

 

2022

 

2023

 

2024

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

In foreign currency

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BNDES

 

26,297

 

71,884

 

64,168

 

50,658

 

126,795

 

127,265

 

21,936

 

 

 

 

 

489,003

 

Bonds

 

 

 

 

 

 

 

 

 

295,712

 

 

 

 

 

 

 

1,836,722

 

2,132,434

 

Export credits (prepayment)

 

148,086

 

558,327

 

952,371

 

1,744,823

 

555,141

 

 

 

 

 

 

 

 

 

3,958,748

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

174,383

 

630,211

 

1,016,539

 

1,795,481

 

977,648

 

127,265

 

21,936

 

 

 

1,836,722

 

6,580,185

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

In Reais

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BNDES - TJLP

 

77,568

 

159,227

 

114,992

 

84,783

 

144,100

 

151,959

 

44,380

 

8,737

 

 

 

785,746

 

BNDES - Fixed

 

12,558

 

25,116

 

24,181

 

18,076

 

6,536

 

 

 

 

 

 

 

 

 

86,467

 

FINAME

 

1,323

 

2,059

 

167

 

 

 

 

 

 

 

 

 

 

 

 

 

3,549

 

NCE

 

71,440

 

257,325

 

231,221

 

43,225

 

43,224

 

 

 

 

 

 

 

 

 

646,435

 

Midwest Region Fund (FCO e FINEP)

 

5,947

 

11,893

 

659

 

494

 

 

 

 

 

 

 

 

 

 

 

18,993

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

168,836

 

455,620

 

371,220

 

146,578

 

193,860

 

151,959

 

44,380

 

8,737

 

 

 

1,541,190

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

343,219

 

1,085,831

 

1,387,759

 

1,942,059

 

1,171,508

 

279,224

 

66,316

 

8,737

 

1,836,722

 

8,121,375

 

 

35



 

Fibria Celulose S.A.

 

Notes to the unaudited consolidated interim

financial information at June 30, 2015

In thousands of Reais, unless otherwise indicated

 

(c)                                 Breakdown by currency

 

 

 

June 30,
2015

 

December 31,
2014

 

 

 

 

 

 

 

Real

 

1,921,457

 

2,045,974

 

U.S. Dollar

 

6,536,077

 

5,808,644

 

Currency basket

 

557,772

 

471,901

 

 

 

 

 

 

 

 

 

9,015,306

 

8,326,519

 

 

(d)                                Roll forward

 

 

 

June 30,
2015

 

December 31,
2014

 

 

 

 

 

 

 

At the beginning of period

 

8,326,519

 

9,773,097

 

Borrowings

 

422,891

 

4,382,345

 

Interest expense

 

209,029

 

475,780

 

Foreign exchange

 

1,054,050

 

690,271

 

Repayments - principal amount

 

(827,050

)

(6,636,153

)

Interest paid

 

(178,726

)

(491,173

)

Expense of transaction costs of Bonds early redeemed

 

 

 

133,233

 

Addition of transaction costs

 

 

 

(36,736

)

Other (*)

 

8,593

 

35,855

 

 

 

 

 

 

 

At the end of the period

 

9,015,306

 

8,326,519

 

 


(*)  It includes amortization of transactions costs.

 

(e)                                 Relevant operations settled in the period

 

Export credits - ACC and ACE

 

In the three-month period ended March 31, 2015, the Company paid in the maturity date the amount of US$ 35 million (equivalents then to R$ 91,777) and, US$ 29 million (equivalents then to R$ 84,078), through its jointly-operation Veracel, regarding exports credits (ACC and ACE), with interest rates between 0.18% and 0.93% p.a.

 

During the second quarter of 2015, the Company, through its jointly-operation Veracel, paid in the maturity date the amount of US$ 32 million (equivalents then to R$ 98,958), regarding exports credits (ACC), with interest rates between 0.87% and 0.92% p.a.

 

(f)                                  Relevant operations contracted in the period

 

Export credits - ACC

 

In the three-month period ended March 31, 2015, the Company, through its jointly-operation Veracel, entered into export contracts (ACC) in the amount of US$ 17 million (equivalent then to R$ 48,750), with maturities between August and September 2015 and fixed interest rate between 1.02% and 1.09% p.a.

 

36



 

Fibria Celulose S.A.

 

Notes to the unaudited consolidated interim

financial information at June 30, 2015

In thousands of Reais, unless otherwise indicated

 

During the second quarter of 2015, the Company, through its jointly-operation Veracel, entered into export contracts (ACC) in the amount of US$ 26 million (equivalent then to R$ 78,948), with maturities between October and December 2015 and fixed interest rate between 1.10% and 1.14% p.a.

 

BNDES

 

In the six-month period ended June 30, 2015, was released from BNDES the amount of R$ 72,109, with maturities between 2015 and 2022, subject to interest rate between TJLP plus 2.42% p.a. and 3.42% p.a., UMBNDES plus 2.42% p.a. and fixed interest rate between 4.00% and 6.00%. The value was used in industrial, forestry and IT projects.

 

(g)                                Covenants

 

Some of the financing agreements of the Company contain covenants establishing maximum indebtedness and leverage levels, as well as minimum coverage of outstanding amounts.

 

The Company’s debt financial covenants are measured based on consolidated information translated into U.S. Dollars. The covenants specify that indebtedness ratio (Net debt to Adjusted EBITDA, as defined (Note 4.2.2 to the most recent financial statements for the year ended December 31, 2014)) cannot exceed 4.5x.

 

The Company is in full compliance with the covenants established in the financial contracts at June 30, 2015.

 

The loan indentures with debt financial covenants also present the following events of default:

 

·             Non-payment, within the stipulated period, of the principal or interest.

 

·             Inaccuracy of any declaration, guarantee or certification provided.

 

·             Cross-default and cross-judgment default, subject to an agreed.

 

·             Subject to certain periods for resolution, breach of any obligation under the contract.

 

·    Certain events of bankruptcy or insolvency of the Company, its main subsidiaries or Veracel.

 

37



 

Fibria Celulose S.A.

 

Notes to the unaudited consolidated interim

financial information at June 30, 2015

In thousands of Reais, unless otherwise indicated

 

20                                 Provision for contingencies

 

 

 

June 30, 2015

 

December 31, 2014

 

 

 

Judicial
deposits

 

Provision

 

Net

 

Judicial
deposits

 

Provision

 

Net

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Nature of claims

 

 

 

 

 

 

 

 

 

 

 

 

 

Tax

 

91,009

 

105,071

 

14,062

 

88,858

 

100,604

 

11,746

 

Labor

 

56,589

 

180,366

 

123,777

 

52,304

 

174,179

 

121,875

 

Civil

 

16,961

 

25,485

 

8,524

 

16,400

 

27,361

 

10,961

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

164,559

 

310,922

 

146,363

 

157,562

 

302,144

 

144,582

 

 

The change in the provision for contingencies is as follows:

 

 

 

June 30,
2015

 

December 31,
2014

 

 

 

 

 

 

 

At the beginning of the period

 

302,144

 

280,512

 

Disposals

 

(2,524

)

(7,280

)

Reversal

 

(18,037

)

(37,458

)

New litigation

 

12,016

 

17,723

 

Accrual of financial charges

 

17,323

 

48,647

 

 

 

 

 

 

 

At the end of the period

 

310,922

 

302,144

 

 

In the six-month period ended June 30, 2015, there were no significant changes in the possible loss contingencies in comparison with the most recent annual financial statements as at December 31, 2014. See below the main update in the period:

 

(i)                                   Swap of industrial and forestry assets with International Paper

 

On March 4, 2015, the Tax Federal Administrative Court (CARF - Conselho Administrativo de Recursos Fiscais), declared that they partially sustained the position of the tax authorities  in regards to the administrative process related to the tax assessment notice issued by the Federal Revenue Service Office regarding the swap of industrial and forestry assets between Fibria and International Paper in 2007 and reduced the applicable fines from 150% to 75%. Following the decision, the updated amount involved was reduced from R$ 1,957 million to R$ 1,550 million, of which R$ 557 million refers to the principal, R$ 417 million to fines and R$ 576 million to interest, as at June 30, 2015.

 

Against the decision, the Company presented the applicable appeals, which is pending of judgement. The National Finance (Fazenda Nacional) also appealed to reduce the qualified fine; however, the appeal was not received, making definitive the decision that reduced the fines from 150% to 75%. In the event of failure at the administrative level, the Company emphasizes that they will discuss the debt at the judicial level.

 

The Company reinforces that the CARF decision does not present any financial impact and maintain its position of not to constitute any provision for contingencies in relation to this matter, based on its understanding and in the internal and external advisors opinion that the probability of gain on the case

 

38



 

Fibria Celulose S.A.

 

Notes to the unaudited consolidated interim

financial information at June 30, 2015

In thousands of Reais, unless otherwise indicated

 

is possible.

 

21                                 Revenue

 

(a)                                Reconciliation

 

 

 

June 30,
2015

 

June 30,
2014

 

 

 

 

 

 

 

Gross amount

 

5,467,819

 

4,059,572

 

Sales taxes

 

(91,388

)

(68,629

)

Discounts and returns (*)

 

(1,070,046

)

(654,767

)

 

 

 

 

 

 

Net revenues

 

4,306,385

 

3,336,176

 

 


(*)  Related mainly to trade discounts.

 

(b)                                Information about markets

 

 

 

June 30,
2015

 

June 30,
2014

 

 

 

 

 

 

 

Revenue

 

 

 

 

 

Domestic market

 

361,422

 

265,434

 

Export market

 

3,903,525

 

3,028,615

 

Services

 

41,438

 

42,127

 

 

 

 

 

 

 

 

 

4,306,385

 

3,336,176

 

 

 

4,306,385

 

3,336,176

 

 

39



 

Fibria Celulose S.A.

 

Notes to the unaudited consolidated interim

financial information at June 30, 2015

In thousands of Reais, unless otherwise indicated

 

22                                 Financial results

 

 

 

June 30,
2015

 

June 30,
2014

 

 

 

 

 

 

 

Financial expenses

 

 

 

 

 

Interest on loans and financing (i)

 

(207,856

)

(245,718

)

Loans commissions

 

(4,626

)

(20,478

)

Financial charges upon partial repurchase of Bond

 

 

 

(456,417

)

Others

 

(34,637

)

(28,036

)

 

 

 

 

 

 

 

 

(247,119

)

(750,649

)

 

 

 

 

 

 

Financial income

 

 

 

 

 

Financial investment earnings

 

38,797

 

48,419

 

Others (ii)

 

42,194

 

21,633

 

 

 

 

 

 

 

 

 

80,991

 

70,052

 

 

 

 

 

 

 

Gains (losses) on derivative financial instruments

 

 

 

 

 

Gains

 

450,269

 

263,412

 

Losses

 

(769,241

)

(84,861

)

 

 

 

 

 

 

 

 

(318,972

)

178,551

 

 

 

 

 

 

 

Gains (losses) on foreign exchange rates

 

 

 

 

 

Loans and financing

 

(1,054,050

)

391,269

 

Other assets and liabilities (iii)

 

114,248

 

(127,430

)

 

 

 

 

 

 

 

 

939,802

 

263,839

 

 

 

 

 

 

 

Net

 

(1,424,902

)

(238,207

)

 


(i)        It includes the amount of R$ 1,173 as at June 30, 2015, of capitalized financing costs.

 

(ii)     It includes the interest accrual of the tax credits.

 

(ii)     It includes the effect of exchange foreign on cash and cash equivalents, trade accounts receivable, trade payable and others.

 

40



 

Fibria Celulose S.A.

 

Notes to the unaudited consolidated interim

financial information at June 30, 2015

In thousands of Reais, unless otherwise indicated

 

23                                 Expenses by nature

 

 

 

June 30,
2015

 

June 30,
2014

 

 

 

 

 

 

 

Cost of sales

 

 

 

 

 

Depreciation, depletion and amortization

 

(913,264

)

(886,163

)

Freight

 

(413,125

)

(386,852

)

Labor expenses

 

(236,675

)

(221,448

)

Variable costs (raw materials and miscellaneous materials)

 

(1,150,257

)

(1,204,307

)

 

 

 

 

 

 

 

 

(2,713,321

)

(2,698,770

)

 

 

 

 

 

 

Selling expenses

 

 

 

 

 

Labor expenses

 

(13,794

)

(11,896

)

Selling expenses (i)

 

(172,420

)

(144,440

)

Operational leasing

 

(729

)

(847

)

Depreciation and amortization charges

 

(4,972

)

(3,884

)

Other expenses

 

(10,053

)

(5,994

)

 

 

 

 

 

 

 

 

(201,968

)

(167,061

)

 

 

 

 

 

 

General and administrative

 

 

 

 

 

Labor expenses

 

(75,173

)

(53,935

)

Third-party services

 

(51,533

)

(55,305

)

Depreciation and amortization

 

(7,756

)

(9,090

)

Taxes and contributions

 

(3,986

)

(4,238

)

Operating leases and insurance

 

(3,692

)

(4,464

)

Other expenses

 

(11,786

)

(3,683

)

 

 

 

 

 

 

 

 

(153,926

)

(130,715

)

 

 

 

 

 

 

Other operating (expenses) income

 

 

 

 

 

Program of variable compensation to employees

 

(35,790

)

(34,832

)

Tax credits

 

 

 

860,764

 

(Provision)/reversal of contingencies

 

(7,022

)

11,796

 

Changes in fair value of biological assets

 

29,831

 

87,192

 

Loss on disposal of property, plant and equipment

 

(2,658

)

(3,792

)

Others

 

1,429

 

(685

)

 

 

 

 

 

 

 

 

(14,210

)

920,443

 

 


(i)            Includes handling expenses, storage and transportation expenses and sales commissions and others.

 

41



 

Fibria Celulose S.A.

 

Notes to the unaudited consolidated interim

financial information at June 30, 2015

In thousands of Reais, unless otherwise indicated

 

24                                 Shareholders’ equity

 

(a)                                Dividends

 

On April 28, 2015, was approved in the Ordinary and Extraordinary Shareholders Meeting the payments to the shareholders in the amount of R$ 147,805, as dividends related to the net income of the fiscal year ended December 31, 2014, being R$ 36,951 corresponding to 25% of the adjusted net income and, R$110,854 as additional dividend. The payment was made on May 14, 2015.

 

25                                 Earnings per share

 

(a)                                Basic

 

The basic earnings per share is calculated by dividing net income attributable to the Company’s shareholders by the weighted average of the number of common shares outstanding during the period, excluding the common shares purchased by the Company and maintained as treasury shares.

 

 

 

June 30,
2015

 

June 30,
2014

 

 

 

 

 

 

 

Numerator

 

 

 

 

 

Net income attributable to the shareholders of the Company

 

42,388

 

646,761

 

 

 

 

 

 

 

Denominator

 

 

 

 

 

Weighted average number of common shares outstanding

 

553,591,619

 

553,591,822

 

 

 

 

 

 

 

Basic earnings per share - in Reais

 

0.077

 

1.168

 

 

The weighted average number of shares in the presented periods is represented by a total number of shares of 553,934,646 issued and outstanding for the six-month period ended June 30, 2015 and 2014, without considering treasury shares, for total of 344,042 shares in the six-month period ended June 30, 2015 (342,824 as at June 30, 2014). In the six-month period ended June 30, 2015 and 2014 there were no changes in the number of shares of Company.

 

(b)                                Diluted

 

Diluted earnings per share are calculated by dividing net income attributable to the Company’s shareholders common shares by the weighted average number of common shares available during the year plus the weighted average number of common shares that would be issued when converting all potentially dilutive common shares into common shares:

 

42



 

Fibria Celulose S.A.

 

Notes to the unaudited consolidated interim

financial information at June 30, 2015

In thousands of Reais, unless otherwise indicated

 

 

 

June 30,
2015

 

 

 

 

 

Numerator

 

 

 

Net income attributable to the shareholders of the Company

 

42,388

 

 

 

 

 

Denominator

 

 

 

Weighted average number of common shares outstanding

 

553,591,619

 

Dilution effect

 

 

 

Stock options

 

687,840

 

Weighted average number of common shares outstanding adjusted according to dilution effect

 

554,279,459

 

 

 

 

 

Diluted earnings per share - in Reais

 

0.076

 

 

There was no dilutive effect in the six-month period ended June 30, 2014.

 

25                                 Explanatory notes not presented

 

According to the requirements for disclosure contained in Circular-Letter CVM/SNC/SEP/ No. 003/2011, we presented explanatory notes to the annual financial statements detailing the financial instruments by category (Note 7), credit quality of financial assets (Note 8), financial and operational lease agreements (Note 21), advances to suppliers (Note 22), the tax amnesty and refinancing program (Note 25), long term commitments (Note 26), benefits to employees (Note 28), compensation program based on shares (Note 29), insurance (Note 34), non-current assets held for sale (Note 36) and impairment testing (Note 37), that we omitted in the March 31, 2015 consolidated interim financial information because the assumptions, operations and policies have not seen any relevant changes compared to the position presented in the financial statements as At December 31, 2014.

 

In addition, the Company no longer has reportable segments to present as at June 30, 2015, therefore the Note regarding segment information was excluded.

 

*          *          *

 

43



 

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: July 22, 2015

 

 

 

Fibria Celulose S.A.

 

 

 

By:

/s/ Guilherme Perboyre Cavalcanti

 

Name:

Guilherme Perboyre Cavalcanti

 

Title:

CFO and IRO

 

44




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