sbs20170328_6k1.htm - Generated by SEC Publisher for SEC Filing
 
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
 

 
FORM 6-K
 
REPORT OF FOREIGN ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 OF THE
SECURITIES EXCHANGE ACT OF 1934
 
For March, 2017
(Commission File No. 1-31317)
 

 
Companhia de Saneamento Básico do Estado de São Paulo - SABESP
(Exact name of registrant as specified in its charter)
 
Basic Sanitation Company of the State of Sao Paulo - SABESP
(Translation of Registrant's name into English)
 


Rua Costa Carvalho, 300
São Paulo, S.P., 05429-900
Federative Republic of Brazil
(Address of Registrant's principal executive offices)



Indicate by check mark whether the registrant files or will file
annual reports under cover Form 20-F or Form 40-F.

Form 20-F ___X___ Form 40-F ______
Indicate by check mark if the registrant is submitting the Form 6-K
in paper as permitted by Regulation S-T Rule 101(b)(1)__.
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)__.

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

Yes ______ No ___X___

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

 
 

CIA. DE SANEAMENTO BÁSICO DO ESTADO DE SÃO PAULO - SABESP
Rui de Britto Álvares Affonso
Chief Financial Officer and Investor Relations Officer
Mario Azevedo de Arruda Sampaio
Head of Capital Markets and Investor Relations

 

 

SABESP announces 2016 results

 

 

SBSP3: R$ 31.60/share

SBS: US$ 10.06 (ADR=1 share)

Total shares: 683,509,869

Market value: R$ 21.6 billion

Closing quote: 03/27/2017

São Paulo, March 27, 2017 - Companhia de Saneamento Básico do Estado de São Paulo - SABESP (BM&FBovespa: SBSP3; NYSE: SBS), one of the largest water and sewage services providers in the world based on the number of costumers, announces today its 4Q16 and FY2016 results. The Company’s operating and financial information, except when indicated otherwise is presented in Brazilian Reais, in accordance with the Brazilian Corporate Law. All comparisons in this release, unless otherwise stated, refer to the same period of 2015.

 

 

 

 

 


 
 

 

1.    Financial highlights

                 

R$ million

 

 

2016

2015

Chg. (R$)

%

4Q16

4Q15

Chg. (R$)

%

 

Gross operating revenue

11,122.2

8,946.8

2,175.4

24.3

2,974.0

2,567.9

406.1

15.8

 

Construction revenue

3,732.9

3,336.7

396.2

11.9

1,112.6

828.3

284.3

34.3

 

COFINS and PASEP taxes

(756.9)

(571.9)

(185.0)

32.3

(200.7)

(173.1)

(27.6)

15.9

(=)

Net operating revenue

14,098.2

11,711.6

2,386.6

20.4

3,885.9

3,223.1

662.8

20.6

 

Costs and expenses

(7,026.6)

(5,550.1)

(1,476.5)

26.6

(1,878.8)

(1,725.0)

(153.8)

8.9

 

Construction costs

(3,651.4)

(3,263.8)

(387.6)

11.9

(1,088.1)

(809.2)

(278.9)

34.5

 

Equity result

4.7

2.5

2.2

88.0

2.5

2.9

(0.4)

(13.8)

 

Other operating revenue (expenses), net

4.7

143.8

(139.1)

(96.7)

(23.2)

45.6

(68.8)

(150.9)

(=)

Earnings before financial result, income tax and social contribution

3,429.6

3,044.0

385.6

12.7

898.3

737.4

160.9

21.8

 

Financial result

699.4

(2,456.5)

3,155.9

(128.5)

163.4

(86.7)

250.1

(288.5)

(=)

Earnings before income tax and social contribution

4,129.0

587.5

3,541.5

602.8

1,061.7

650.7

411.0

63.2

 

Income tax and social contribution

(1,181.9)

(51.2)

(1,130.7)

2,208.4

(114.8)

(189.8)

75.0

(39.5)

(=)

Net income

2,947.1

536.3

2,410.8

449.5

946.9

460.9

486.0

105.4

 

Earnings per share* (R$)

4.31

0.78

 

 

1.39

0.67

 

 

 

* Total shares = 683,509,869

               

 

 

Adjusted EBITDA Reconciliation (Non-accounting measures)

 

                 

R$ million

 

 

2016

2015

Chg. (R$)

%

4Q16

4Q15

Chg. (R$)

%

 

Net income

2,947.1

536.3

2,410.8

449.5

946.9

460.9

486.0

105.4

 

Income tax and social contribution

1,181.9

51.2

1,130.7

2,208.4

114.8

189.8

(75.0)

(39.5)

 

Financial result

(699.4)

2,456.5

(3,155.9)

(128.5)

(163.4)

86.7

(250.1)

(288.5)

 

Other operating revenues (expenses), net

(4.7)

(143.8)

139.1

(96.7)

23.2

(45.6)

68.8

(150.9)

(=)

Adjusted EBIT*

3,424.9

2,900.2

524.7

18.1

921.5

691.8

229.7

33.2

 

Depreciation and amortization

1,146.6

1,074.1

72.5

6.7

287.6

265.4

22.2

8.4

(=)

Adjusted EBITDA **

4,571.5

3,974.3

597.2

15.0

1,209.1

957.2

251.9

26.3

 

(%) Adjusted EBITDA margin

32.4

33.9

 

 

31.1

29.7

 

 

(*) Adjusted EBIT is net income before: (i) other operating revenues/expenses, net; (ii) financial result; and (iii) income tax and social contribution.
(**) Adjusted EBITDA is net income before: (i) depreciation and amortization expenses; (ii) income tax and social contribution; (iii) financial result; and (iv) other operating revenues/expenses, net.


In 2016, net operating revenue, including construction revenue, reached R$ 14,098.2 million; a 20.4% increase compared to 2015.

Costs and expenses, including construction costs, totaled R$ 10,678.0 million, 21.1% higher than in 2015.

Adjusted EBIT, in the amount of R$ 3,424.9 million, grew 18.1% from R$ 2,900.2 million recorded in 2015.

Adjusted EBITDA, in the amount of R$ 4,571.5 million, increased 15.0% from R$ 3,974.3 million recorded in 2015.

The adjusted EBITDA margin was 32.4% in 2016 against 33.9% in 2015. Excluding construction revenues and construction costs, the adjusted EBITDA margin was 43.3% in 2016 (46.6% in 2015).

In 2016 the Company recorded a net income of R$ 2,947.1 million, in comparison to a net income of R$ 536.3 million in 2015.

 

2. Gross operating revenue

Gross operating revenue from water and sewage, not including construction revenue, totaled R$ 11,122.2 million, an increase of R$ 2,175.4 million or 24.3%, when compared to the R$ 8.946.8 million recorded in 2015.

The main factors that led to this variation were:

·         Tariff increase of 15.2% (7.8% ordinary tariff adjustment and 6.9% extraordinary tariff revision) since June 2015;

·         Tariff increase of 8.4% since May 2016;

·         Increase of 4.4% in the Company’s total billed volume (4.0% in water and 4.8% in sewage); and

·         Bonus granted within the Water Consumption Reduction Incentive Program, concluded in April 2016, was lower in 2016, amounting to R$ 187.4 million (R$ 926.1 million in 2015).

 

Page 2 of 14


 
 

 

The increase resulting from the above mentioned factors was partially offset by the suspension of the Contingency Tariff in April 2016, in the amount of R$ 224.7 million in 2016 (R$ 499.7 million in 2015).

 

3. Construction revenue

Construction revenue increased R$ 396.2 million or 11.9%, when compared to 2015. The variation was mainly due to higher investments in the municipalities served by the Company.


4. Billed volume

 

The following tables show the water and sewage billed volume, on quarter-on-quarter and annual basis, per customer category and region.

 

WATER AND SEWAGE BILLED VOLUME (1) PER CUSTOMER CATEGORY - million m3

 

 

Water

 

 

Sewage

 

Water + Sewage

 

Category

4Q16

4Q15

%

4Q16

4Q15

%

4Q16

4Q15

%

Residential

392.0

374.9

4.6

332.7

316.0

5.3

724.7

690.9

4.9

Commercial

41.2

40.5

1.7

39.3

38.5

2.1

80.5

79.0

1.9

Industrial

7.9

8.0

(1.3)

9.6

9.7

(1.0)

17.5

17.7

(1.1)

Public

10.3

9.8

5.1

9.1

8.6

5.8

19.4

18.4

5.4

Total retail

451.4

433.2

4.2

390.7

372.8

4.8

842.1

806.0

4.5

Wholesale (3)

60.2

50.7

18.7

7.8

6.1

27.9

68.0

56.8

19.7

Total

511.6

483.9

5.7

398.5

378.9

5.2

910.1

862.8

5.5

 

2016

2015

%

2016

2015

%

2016

2015

%

Residential

1,527.6

1,465.0

4.3

1,294.0

1,232.1

5.0

2,821.6

2,697.1

4.6

Commercial

162.9

160.0

1.8

155.0

151.9

2.0

317.9

311.9

1.9

Industrial

31.6

32.6

(3.1)

38.3

38.9

(1.5)

69.9

71.5

(2.2)

Public

40.8

40.6

0.5

35.9

33.4

7.5

76.7

74.0

3.6

Total retail

1,762.9

1,698.2

3.8

1,523.2

1,456.3

4.6

3,286.1

3,154.5

4.2

Wholesale (3)

227.4

215.5

5.5

29.0

24.4

18.9

256.4

239.9

6.9

Total

1,990.3

1,913.7

4.0

1,552.2

1,480.7

4.8

3,542.5

3,394.4

4.4

 

WATER AND SEWAGE BILLED VOLUME (1) PER REGION - million m3

 

Water

 

Sewage

 

Water + Sewage

 

Region

4Q16

4Q15

%

4Q16

4Q15

%

4Q16

4Q15

%

Metropolitan

290.7

277.6

4.7

252.8

240.8

5.0

543.5

518.4

4.8

Regional (2)

160.7

155.6

3.3

137.9

132.0

4.5

298.6

287.6

3.8

Total retail

451.4

433.2

4.2

390.7

372.8

4.8

842.1

806.0

4.5

Wholesale (3)

60.2

50.7

18.7

7.8

6.1

27.9

68.0

56.8

19.7

Total

511.6

483.9

5.7

398.5

378.9

5.2

910.1

862.8

5.5

 

2016

2015

%

2016

2015

%

2016

2015

%

Metropolitan

1,136.7

1,084.3

4.8

987.8

939.1

5.2

2,124.5

2,023.4

5.0

Regional (2)

626.2

613.9

2.0

535.4

517.2

3.5

1,161.6

1,131.1

2.7

Total retail

1,762.9

1,698.2

3.8

1,523.2

1,456.3

4.6

3,286.1

3,154.5

4.2

Wholesale (3)

227.4

215.5

5.5

29.0

24.4

18.9

256.4

239.9

6.9

Total

1,990.3

1,913.7

4.0

1,552.2

1,480.7

4.8

3,542.5

3,394.4

4.4

             (1) Unaudited

             (2) Including coastal and interior region

             (3) Reused water volume and non-domestic sewage are included in

 

 

Page 3 of 14


 
 

 

5. Costs, administrative, selling and construction expenses

In 2016, costs, administrative, selling and construction expenses, grew 21.1% (R$ 1,864.1 million). Excluding construction costs, total costs and expenses increased by 26.6% (R$ 1,476.5 million).

As a percentage of net revenue, costs and expenses were 75.7% in 2016 compared to 75.3% in 2015.

 

               

R$ million

 

2016

2015

Chg. (R$)

%

4Q16

4Q15

Chg. (R$)

%

Salaries and payroll charges and Pension plan obligations

2,171.2

2,193.7

(22.5)

(1.0)

683.2

578.3

104.9

18.1

General supplies

179.4

178.6

0.8

0.4

54.8

44.9

9.9

22.0

Treatment supplies

279.2

269.3

9.9

3.7

73.8

70.5

3.3

4.7

Services

1,278.8

1,162.6

116.2

10.0

333.0

300.1

32.9

11.0

Electricity

935.0

817.5

117.5

14.4

227.1

230.1

(3.0)

(1.3)

General expenses

855.0

466.7

388.3

83.2

214.4

219.1

(4.7)

(2.1)

Tax expenses

91.0

81.5

9.5

11.7

24.5

23.6

0.9

3.8

São Paulo state government reimbursement

-

(696.3)

696.3

-

-

-

-

-

Sub-total

5,789.6

4,473.6

1,316.0

29.4

1,610.8

1,466.6

144.2

9.8

Depreciation and amortization

1,146.6

1,074.1

72.5

6.7

287.6

265.4

22.2

8.4

Allowance for doubtful accounts

90.4

2.4

88.0

3,666.7

(19.6)

(7.0)

(12.6)

180.0

Sub-total

1,237.0

1,076.5

160.5

14.9

268.0

258.4

9.6

3.7

Costs, administrative and selling expenses

7,026.6

5,550.1

1,476.5

26.6

1,878.8

1,725.0

153.8

8.9

Construction costs

3,651.4

3,263.8

387.6

11.9

1,088.1

809.2

278.9

34.5

Costs, adm., selling and construction expenses

10,678.0

8,813.9

1,864.1

21.1

2,966.9

2,534.2

432.7

17.1

% of net revenue

75.7

75.3

 

 

76.4

78.6

 

 

 

 

5.1. Salaries and payroll charges and Pension plan obligations

 

There was a decrease of R$ 22.5 million in 2016, mainly due to:

 

·         Decrease of R$ 307.4 million due to the migration of 3,572 participants from the Defined Benefit Plan (G1) to the Defined Contribution Plan (Sabesprev Mais), generating in advance a decrease of R$ 334.2 million in the actuarial deficit, offset by the extraordinary contribution and incentive of R$ 26.8 million;

 

The above mentioned decrease was partly compensated by the following factors:

 

·         Increase of R$ 126.8 million due to the 10.03% salary adjustment in May 2016;

·         Increase of R$ 129.9 million in provisions for severance pay (TAC), mainly due to the higher number of retired employees in 2016; and

·         R$ 27.6 million increase in provisions for supplementary payments for retirement plans and pensions under the G0 Plan, due to changes in actuarial assumptions.

 

 5.2. Services

 

Services expenses, in the amount of R$ 1,278.8 million, grew R$ 116.2 million or 10.0%, in comparison to R$ 1,162.6 million in 2015. The main items that led to this increase were:

                          

·         Maintenance of networks and sewage and equipment connections, amounting to R$ 28.8 million;

·         Advertising campaigns totaling R$ 19.5 million;

·         Asphalt and pavement replacement amounting to R$ 15.6 million;

·         Reading water meters and delivering bills, R$ 14.1 million;

·         Surveillance contract, R$ 7.9 million; and

·         Credit recovery contracts totaling R$ 7.7 million.

 

 

 

Page 4 of 14


 
 

 

5.3. Electricity

 

Electricity expenses totaled R$ 935.0 million in 2016, an increase of R$ 117.5 million or 14.4% in comparison to the R$ 817.5 million in 2015. The main factors that contributed to this increase were:

·         Average increase of 15.4% in the free market tariffs, with an 2.3% increase in consumption;

·         Average increase of 21.5% in the grid market tariff (TUSD), with a 5.0% rise in consumption; and

·         Average increase of 1.5% in the regulated market tariffs, with consumption remaining stable.

 

In 2016, the regulated market accounted for 37.3% of the total electricity consumed by the Company, the free market accounted for 32.6% and the grid market accounted for 30.1% of total consumption.

 

5.4. General expenses

 

General expenses increased R$ 388.3 million, or 83.2%, totaling R$ 855.0 million in 2016, versus the R$ 466.7 million recorded in 2015, mainly due to:

·         Increase of R$ 212.3 million, mainly due to increased provisions for court proceedings in 2016 and reversals in 2015, resulting from judicial decisions;

·         Higher provision for the Municipal Fund for Environmental Sanitation and Infrastructure, in the amount of R$ 101.1 million, as a result of the increase in revenues with the municipality of São Paulo;

·         Provision of R$ 38.1 million concerning the agreement entered into with EMAE – Empresa Metropolitana de Águas e Energia; and

·         Reversal of provision in 2015, amounting to R$ 17.9 million, due to the recovery of funds from the São Paulo State Government (GESP), due to employees assignment.

 

5.5. GESP Reimbursement

In 2015, the Company entered into an Agreement with the São Paulo State Government (GESP) in order to receive the undisputed amount related to the state government's debt with the Company for the payment of the benefits related to State Law 4,819, of August 26, 1958, to former employees (G0), which generated a R$ 696.3 million credit in the result.

 

5.6. Depreciation and amortization

 

Depreciation and amortization increased R$ 72.5 million or 6.7%, reaching R$ 1,146.6 million in 2016 in comparison to the R$ 1,074.1 million recorded in 2015, largely due to the beginning of operations of intangible assets, in the amount of R$ 2.1 billion.

 


5.7. Allowance for doubtful accounts

 

 

Increase of R$ 88.0 million, mainly resulting from:

 

·         Increase in default, causing a R$165.4 million impact; and

·         Lower recovery of funds, amounting to R$ 34.5 million.

 

This increase was partially offset by the higher receipt of court-ordered debt payments, especially from the city of Guarulhos, amounting to R$ 110.9 million.

 

 

 

 

 

 

Page 5 of 14


 
 

 

6. Other operating revenues (expenses), net

 

Other net operational revenues and expenses reported a negative variation of R$ 139.1 million, mainly due to the following events:

 

·         Reduction of R$ 47.4 million in revenue from the sale of properties;

·         Decline of R$ 42.8 million in revenue from the sale of surplus electricity; and

·         Decrease of R$ 23.2 million in the amount received from REAGUA - Programa Estadual de Apoio à Recuperação de Águas (State Program to Support Water Recovery).

 

 

7. Financial result

 

       

R$ million

 

2016

2015

Chg.

%

Financial expenses, net of income

(332.8)

(435.4)

102.6

(23.6)

Net monetary and exchange variation

1,032.2

(2,021.1)

3,053.3

(151.1)

Financial result

699.4

(2,456.5)

3,155.9

(128.5)

 

 

 

7.1. Financial income and expenses

 

 

       

R$ million

 

2016

2015

Chg.

%

Financial expenses

 

 

 

 

Interest and charges on domestic loans and financing

(317.4)

(326.3)

8.9

(2.7)

Interest and charges on international loans and financing

(113.3)

(127.3)

14.0

(11.0)

Other financial expenses

(198.6)

(210.1)

11.5

(5.5)

Total financial expenses

(629.3)

(663.7)

34.4

(5.2)

Financial income

296.5

228.3

68.2

29.9

Financial expenses net of income

(332.8)

(435.4)

102.6

(23.6)

                                                                                                                                                         

 

7.1.1. Financial expenses

 

 

Decrease of R$ 34.4 million, mainly due to the following events:

 

·         Interest and charges on domestic loans and financing: reduction of R$ 8.9 million, due to increased capitalization of interests in 2016, as a result of an upturn in work in progress; and

·         Interest and charges on international loans and financing: decrease of R$ 14.0 million, due to the reduction in the total debt amount, as a result of the depreciation of the dollar and the yen in 2016 (16.5% and 13.9%, respectively), versus an appreciation in 2015 (47.0% and 45.9%, respectively).

 

7.1.2. Financial income

 

Increase of R$ 68.2 million, chiefly due to higher interest on financial investments in 2016, as a result of the upturn in the invested amount.



 

 

 

 

 

 

Page 6 of 14


 
 

 

7.2. Monetary and exchange rate variation on assets and liabilities

 

       

R$ million

 

2016

2015

Chg.

%

Monetary variation on loans and financing

(121.0)

(171.7)

50.7

(29.5)

Currency exchange variation on loans and financing

1,090.2

(1,992.7)

3,082.9

(154.7)

Other monetary variations

(89.5)

(24.3)

(65.2)

268.3

Monetary/exchange rate variation on liabilities

879.7

(2,188.7)

3,068.4

(140.2)

Monetary/exchange rate variation on assets

152.5

167.6

(15.1)

(9.0)

Monetary/exchange rate variation, net

1,032.2

(2,021.1)

3,053.3

(151.1)

 

 

7.2.1 Monetary and exchange rate variation on liabilities

 

The effect of monetary and currency variations in 2016 was R$ 3,068.4 million less than in 2015, mainly due to:

 

·         Reduction of R$ 50.7 million in expenses with monetary variation on loans and financing, due to the lower increase in the IPCA in 2016 compared with 2015 (6.29% and 10.67%, respectively).

 

·         A positive variation of R$ 3,082.9 million in the cost of currency variations on loans and financing, due to the dollar and the yen devaluation against the Real in 2016 (16.5% and 13.9%, respectively), compared with their appreciation in 2015 (47.0% and 45.9%, respectively); and

·         Increase in the cost of other monetary variations by R$ 65.2 million, principally due to higher provisioning for court proceedings in 2016.

 

 

7.2.2 Monetary and exchange rate variation on assets

 

Decrease of R$ 15.1 million, mainly due to the lower monetary restatement of judicial deposits in 2016.

 

8. Income tax and social contribution


Increase of R$ 1,130.7 million, mainly due to the upturn in operating revenue and the financial result, which was impacted by exchange rate oscillations. These increases were partially offset by the upturn in operating costs and expenses.

 


9. Indicators



 

9.1. Operating

 

Water production volume increased 9.3% in 2016.

 

Page 7 of 14


 
 

 

 

Operating indicators *

2016

2015

%

Water connections (1)

8,654

8,420

2.8

Sewage connections (1)

7,091

6,861

3.4

Population directly served - water (2)

24.7

24.4

1.2

Population directly served - sewage (2)

21.3

21.0

1.4

Number of Employees (3)

14,137

14,223

(0.6)

Water volume produced(4)

2,696

2,467

9.3

IPM - Measured water loss (%)

31.8

28.5

11.6

IPDt (liters/connection x day)

308

258

19.4

(1)    Total connections, active and inactive, in thousand units at the end of the period

(2)    In million inhabitants, at the end of the period. Not including wholesale

(3)    In 2015, the number included 370 employees retired for disability, excluded from the total figure in 2016.

(4)    In millions of cubic meters

        ( * )  Unaudited

 

 

 

9.2. Financial

 

Economic Indexes * (year end)

2016

2015

Accumulated Amplified Consumer Price Index (%)

6.29

10.67

Accumulated Referential Rate (%)

2.01

1.80

Interbank Deposit Certificate (%)

13.63

14.14

US DOLAR (R$)

3.2591

3.9048

YEN (R$)

0.02792

0.03243

                            (*) Unaudited

 

 

10. Loans and financing

 

In November 2016, the Company paid the last installment of the principal and interest of the Eurobond 2016 issue, in the amount of R$ 454 million.

 

 

               

R$ million

INSTITUTION

2017

2018

2019

2020

2021

2022

2023 Onwards

Total

Local currency

 

 

 

 

 

 

 

 

Caixa Econômica Federal

59.2

63.5

65.4

67.6

71.1

74.8

745.8

1,147.4

Debentures

596.0

889.4

1,001.5

416.9

197.1

176.7

253.6

3,531.2

BNDES

87.5

93.3

101.4

83.4

83.0

83.0

408.0

939.6

Leasing

14.9

39.1

29.0

30.6

32.3

34.1

372.4

552.4

Others

0.7

1.4

1.4

1.4

1.4

1.4

3.9

11.6

Interest and other charges

121.6

-

-

-

-

-

-

121.6

Total in local currency

879.9

1,086.7

1,198.7

599.9

384.9

370.0

1,783.7

6,303.8

Foreign currency

 

 

 

 

 

 

 

 

IADB

190.4

108.6

108.6

108.6

108.6

108.6

1,064.7

1,798.1

IBRD

-

-

8.7

17.4

17.4

17.4

199.4

260.3

Deutsche Bank 350

-

240.1

240.1

-

-

-

-

480.2

Eurobond

-

-

-

1,137.4

-

-

-

1,137.4

JICA

62.3

63.5

105.2

105.2

105.2

105.2

1,060.0

1,606.6

IDB 1983AB

78.0

77.4

57.7

55.8

25.0

25.0

22.9

341.8

Interest and other charges

35.9

-

-

-

-

-

-

35.9

Total in foreign currency

366.6

489.6

520.3

1,424.4

256.2

256.2

2,347.0

5,660.3

Total

1,246.5

1,576.3

1,719.0

2,024.3

641.1

626.2

4,130.7

11,964.1

 

 

 

Page 8 of 14


 
 

11. Capex

2016 investments, totaling R$ 3.9 billion, including R$ 1.3 billion related to the São Lourenço PPP, still reflected the priority given to the water supply infrastructure.


The chart below shows the breakdown of investments by water, sewage and region:

 

 

     

R$ million

Investments in 2016

Water

Sewage

Total

Metropolitan Region

2,373.5

819.4

3,192.9

Regional Systems

270.1

414.7

684.8

Total

2,643.6

1,234.1

3,877.7

 Note: Does not include obligations related to program contracts (R$ 5.8 million)

 

 

 


Capex Plan 2017-2021: R$ 13.9 billion

 

Between 2017 and 2021, the Company plans to invest directly approximately R$ 13.9 billion, R$ 7.1 billion of which in water and R$ 6.8 billion in sewage collection and treatment.

 

           

R$ million

 

2017

2018

2019

2020

2021

Total

Water

1,553

1,617

1,327

1,192

1,409

7,098

Sewage Collection

642

989

1,152

1,395

1,245

5,423

Sewage Treatment

136

248

330

362

282

1,358

Total

2,331

2,854

2,809

2,949

2,936

13,879

 

 

 

 

 

 

12. Conference calls

 

 

In English

March 28, 2017

1:00 pm (US EST) / 2:00 pm (Brasília)

Dial in: 1 (412) 317-5486

Conference ID: Sabesp

 

 

Replay available for 7 days

Dial in: 1(412) 317-0088

Replay ID: 24033715

 

Click here for the webcast

 

 

 

 

 

 

 

 

 

In Portuguese

March 28, 2017

9:30 am (US EST) / 10:30 am (Brasília)

Dial in: 55 (11) 3127-4971 or

55 (11) 3728-5971

Conference ID: Sabesp

 

Replay available for 7 days

Dial in: 55 (11) 3127-4999

Replay ID: 10098739

 

Click here for the webcast

 

 

Page 9 of 14


 
 

 

 

For more information, please contact:

 

Mario Arruda Sampaio

Head of Capital Markets and Investor Relations

Phone.(55 11) 3388-8664

E-mail: maasampaio@sabesp.com.br

 

Angela Beatriz Airoldi                                                                         

Investor Relations Manager

Phone.(55 11) 3388-8793

E-mail: abairoldi@sabesp.com.br

 

 

 

Statements contained in this press release may contain information that is forward-looking and reflects management's current view and estimates of future economic circumstances, industry conditions, SABESP performance, and financial results. Any statements, expectations, capabilities, plans and assumptions contained in this press release that do not describe historical facts, such as statements regarding the declaration or payment of dividends, the direction of future operations, the implementation of principal operating and financing strategies and capital expenditure plans, the factors or trends affecting financial condition, liquidity or results of operations are forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995 and involve a number of risks and uncertainties. There is no guarantee that these results will actually occur. The statements are based on many assumptions and factors, including general economic and market conditions, industry conditions, and operating factors. Any changes in such assumptions or factors could cause actual results to differ materially from current expectations.

Page 10 of 14


 
 

 

Income Statement

 

Brazilian Corporate Law

 

R$ '000

 

2016

2015

Net Operating Income

14,098,208

11,711,569

Operating Costs

(9,013,120)

(8,260,763)

Gross Profit

5,085,088

3,450,806

Operating Expenses

 

 

Selling

(730,047)

(598,125)

Administrative revenue (expenses)

(934,896)

44,958

Other operating revenue (expenses), net 

4,722

143,755

Operating Income Before Shareholdings 

3,424,867

3,041,394

Equity Result 

4,740

2,597

Earnings Before Financial Results, net

3,429,607

3,043,991

Financial, net

(391,181)

(464,498)

Exchange gain (loss), net

1,090,628

(1,991,964)

Earnings before Income Tax and Social Contribution

4,129,054

587,529

Income Tax and Social Contribution

 

 

Current

(1,121,289)

(1,226)

Deferred

(60,667)

(50,024)

Net Income for the period

2,947,098

536,279

Registered common shares ('000)

683,509

683,509

Earnings per shares - R$ (per share)

4.31

0.78

Depreciation and Amortization

(1,146,626)

(1,074,032)

Adjusted EBITDA

4,571,511

3,974,268

% over net revenue

32.4%

33.9%

 

Net Operating Income Breakdown

 

R$ '000

 

2016

2015

Gross operating income

14,855,109

12,283,541

Water suply - retail

5,879,336

4,879,753

Water suply - wholesale

90,867

66,564

Sewage collection and treatment

4,944,983

3,828,288

Sewage collection and treatment - wholesale

36,160

26,549

Construction revenue - water

2,563,839

2,090,012

Construction revenue - sewage

1,169,038

1,246,704

Other services

170,886

145,671

Gross sales deductions (Cofins/Pasep)

(756,901)

(571,972)

Net operating income

14,098,208

11,711,569

 

 



 

Page 11 of 14


 
 

 

Balance Sheet

 

Brazilian Corporate Law

   

R$ '000

ASSETS

12/31/16

 

12/31/15

Current assets

 

 

 

Cash and cash equivalents

1,886,221

1,639,214

Trade receivables

1,557,472

1,326,972

Related parties and transactions

202,553

156,155

Inventories

58,002

64,066

Restricted cash

24,078

29,156

Currrent recoverable taxes

42,633

77,828

Other receivables

52,676

156,942

Total current assets

3,823,635

3,450,333

 

 

 

 

Noncurrent assets

 

 

 

Trade receivables

153,834

182,616

Related parties and transactions

669,156

715,952

Escrow deposits

77,915

 

76,663

Deferred income tax and social contribution

186,345

128,242

Water National Agency &8211; ANA

81,221

88,368

Other receivables

114,693

140,676

 

 

 

Equity investments

31,096

28,105

Investment properties

57,968

56,957

Intangible assets

31,246,788

28,513,626

Property, plant and equipment

302,383

325,076

Total noncurrent assets

32,921,399

30,256,281

 

 

 

 

Total assets

36,745,034

33,706,614

 

 

 

 

LIABILITIES AND EQUITY

12/31/16

 

12/31/15

Current liabilities

 

 

 

Trade payables

311,960

248,158

Borrowings and financing

1,246,567

1,526,262

Accrued payroll and related charges

458,299

347,976

Taxes and contributions

168,757

107,295

Dividends and interest on capital payable

700,034

127,441

Provisions

730,334

631,890

Services payable

460,054

387,279

Public-Private Partnership &8211; PPP

31,898

33,255

Program Contract Commitments

109,042

228,659

Other liabilities

85,563

102,101

Total current liabilities

4,302,508

3,740,316

 

 

 

 

Noncurrent liabilities

 

 

 

Borrowings and financing

10,717,576

11,595,338

Deferred Cofins and Pasep

138,071

132,921

Provisions

442,741

450,324

Pension obligations

3,265,250

2,832,216

Public-Private Partnership &8211; PPP

2,217,520

1,001,778

Program Contract Commitments

69,051

92,055

Other liabilities

173,106

145,060

Total noncurrent liabilities

17,023,315

16,249,692

 

 

Total liabilities

21,325,823

 

19,990,008

 

 

 

 

Equity

 

 

 

Paid-up capital

10,000,000

10,000,000

Profit reserve

6,244,859

4,069,988

Other comprehensive income

(825,648)

(353,382)

Total equity

15,419,211

13,716,606

 

 

 

 

Total equity and liabilities

36,745,034

33,706,614

 

 

 

Page 12 of 14


 
 

 

Cash Flow

 

Brazilian Corporate Law

 

R$ '000

 

 

2016

2015

Cash flow from operating activities

 

 

Profit before income tax and social contribution

4,129,054

587,529

Adjustment for:

 

 

Depreciation and amortization

1,146,626

1,074,032

Residual value of property, plant and equipment and intangible assets written-off

15,168

52,040

Allowance for doubtful accounts

90,488

2,420

Provision and inflation adjustment

276,654

(4,706)

Pension obligations - curtailment

(334,152)

-

Interest calculated on loans and financing payable

449,470

474,056

Inflation adjustment and foreign exchange gains (losses) on loans and financing

(969,430)

2,163,754

Interest and inflation adjustment losses

24,297

27,168

Interest and inflation adjustment gains

(80,675)

(130,762)

Financial charges from customers

(207,789)

(125,966)

Fair value margin on intangible assets arising from concession

(81,513)

(72,908)

Provision for Consent Decree (TAC)

89,083

(15,601)

Equity result

(4,740)

(2,597)

Provision from São Paulo agreement

-

11,252

Provision for defined contribution plan

235

8,349

Pension obligations

377,886

352,710

Other adjustments

24,412

(6,103)

GESP Agreement

-

(696,283)

   

4,945,074

3,698,384

Changes in assets

 

 

Trade accounts receivable

(34,665)

(111,738)

Accounts receivable from related parties

(3,163)

(2,818)

Inventories

7,156

(550)

Recoverable taxes

35,195

70,940

Escrow deposits

33,232

35,083

Other accounts receivable

144,920

(9,785)

Changes in liabilities

 

 

Trade payables and contractors

6,371

(18,314)

Services payable

72,775

57,054

Accrued payroll and related charges

21,240

(24,394)

Taxes and contributions payable

(90,325)

35,947

Deferred Cofins/Pasep

5,150

3,570

Provisions

(185,793)

(133,427)

Pension obligations

(201,736)

(182,514)

Other liabilities

17,842

(47,607)

     

 

Cash generated from operations

4,773,273

3,369,831

     

 

Interest paid

(739,944)

(710,688)

Income tax and contribution paid

(1,029,737)

(17,743)

   

 

 

Net cash generated from operating activities

3,003,592

2,641,400

   

 

 

Cash flows from investing activities

 

 

 

Acquisition of intangibles

(2,108,167)

(2,397,352)

Restricted cash

5,078

(9,406)

Investment increase

-

(2,540)

Purchases of tangible assets

(27,631)

(54,794)

Dividends received

-

4,612

Net cash used in investing activities

(2,130,720)

(2,459,480)

   

 

 

Cash flow from financing activities

 

 

 

Loans and financing

 

 

Proceeds from loans

1,250,524

1,303,296

Repayments of loans

(1,535,312)

(1,292,322)

Payment of interest on shareholders'equity

(139,399)

(202,115)

Public-Private Partnership – PPP

(30,498)

(23,799)

Program Contract Commitments

(171,180)

(50,757)

Net cash generated by (used in) financing activities

(625,865)

(265,697)

   

Increase/(reduction) of cash and cash equivalents

247,007

(83,777)

       

Represented by:

   

Cash and cash equivalents at beginning of the period

1,639,214

1,722,991

Cash and cash equivalents at end of the period

1,886,221

1,639,214

Increase/(reduction) of cash and cash equivalents

247,007

(83,777)

 

 

Page 13 of 14

 

SIGNATURE  
 
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, in the city São Paulo, Brazil.
Date: March 28, 2017
 
Companhia de Saneamento Básico do Estado de São Paulo - SABESP
By: /s/  Rui de Britto Álvares Affonso    
 
Name: Rui de Britto Álvares Affonso
Title: Chief Financial Officer and Investor Relations Officer
 

 

 
FORWARD-LOOKING STATEMENTS

This press release may contain forward-looking statements. These statements are statements that are not historical facts, and are based on management's current view and estimates of future economic circumstances, industry conditions, company performance and financial results. The words "anticipates", "believes", "estimates", "expects", "plans" and similar expressions, as they relate to the company, are intended to identify forward-looking statements. Statements regarding the declaration or payment of dividends, the implementation of principal operating and financing strategies and capital expenditure plans, the direction of future operations and the factors or trends affecting financial condition, liquidity or results of operations are examples of forward-looking statements. Such statements reflect the current views of management and are subject to a number of risks and uncertainties. There is no guarantee that the expected events, trends or results will actually occur. The statements are based on many assumptions and factors, including general economic and market conditions, industry conditions, and operating factors. Any changes in such assumptions or factors could cause actual results to differ materially from current expectations.