(Convenience Translation into English from the Original Previously Issued in Portuguese)
Biosev S.A.
Individual and Consolidated Interim Financial Statements
For the Nine-month Period Ended December 31, 2020
Interim Financial Statements
December 31, 2020
CONTENTS
INDEPENDENT AUDITOR'S REVIEW REPORT ON THE INTERIM FINANCIAL INFORMATION……… ........ . 04
BALANCE SHEET ................................................................................................................................................ 06
STATEMENT OF OPERATIONS ......................................................................................................................... 07
STATEMENT OF COMPREHENSIVE INCOME (LOSS) ..................................................................................... 08
STATEMENT OF CHANGES IN EQUITY ............................................................................................................ 09
STATEMENT OF CASH FLOWS ......................................................................................................................... 10
STATEMENT OF VALUE ADDED ........................................................................................................................ 11
NOTES
28.EMPLOYEES' BENEFIT.................................................................................................................................. 51
Tel.: +55 11 3848 5880 | Rua Major Quedinho 90 |
Fax: + 55 11 3045 7363 | Consolação - São Paulo, SP - Brasil |
www.bdo.com.br | 01050-030 |
(Convenience Translation into English fromthe Original Previously Issued in Portuguese)
INDEPENDENT AUDITOR'S REVIEW REPORT ON THE INTERIM FINANCIAL INFORMATION
To the
Board of Directors and Shareholders Biosev S.A.
São Paulo - SP
Introduction
We have reviewed the accompanying individual and consolidated interim financial information of Biosev S.A. (the "Company"), contained in the Quarterly Information Form (ITR) for the quarter ended December 31, 2020, which comprises the statement of financial position as of December 31, 2020, and the respective statements of profit or loss and other comprehensive income for the three and nine-month periods then ended and changes in equity and cash flows for the nine-month period then ended, including the explanatory notes.
The Company´s management is responsible for the preparation of the individual and consolidated interim financial information in accordance with Technical Pronouncement CPC 21 (R1) - Interim Financial Reporting and IAS 34 - Interim Financial Reporting, issued by International Accounting Standards Board (IASB), as well for the presentation of this information in accordance with standards issued by the Brazilian Securities and Exchange Commission, applicable to the preparation of Quarterly Information - ITR. Our responsibility is to express a conclusion on this interim financial information based on our review.
Scope of review
We conducted our review in accordance with the Brazilian and International standards on review engagements 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 financial information consists of making inquiries, primarily of persons responsible for the 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 the audit standards and, consequently, does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
Conclusion on the interim financial information
Based on our review, nothing has come to our attention that causes us to believe that the accompanying individual and consolidated interim financial information included in the Quarterly Information referred to above has not been prepared, in all material respects, in accordance with Technical Pronouncement CPC 21 (R1) and IAS 34, issued by IASB, applicable to the preparation of Quarterly Information - ITR, and presented in accordance with standards issued by the Brazilian Securities and Exchange Commission.
4
Emphasis of matter
Transactions with related parties
The Company and its subsidiaries have carried out significant transactions with related parties of the Louis Dreyfus Company Group. The effects on results of these transactions and the corresponding assets and liabilities are disclosed in note 20. Our conclusion is not modified with respect to this matter.
Other matters
Statements of Value Added
The quarterly information referred to above includes the individual and consolidated statements of value added for the nine-month period ended December 31, 2020. These statements are the responsibility of the Company's management and are presented as supplementary information under IAS 34. These statements have been subjected to review procedures performed together with the review of the interim accounting information for the purpose of concluding whether they are reconciled with the interim accounting information and accounting records, as applicable, and if their form and content are in accordance with the criteria defined in the accounting standard CPC 09 - "Statement of Value Added". Based on our review, nothing has come to our attention that causes us to believe that these statements of value added have not been properly prepared, in all material respects, in accordance with the criteria established in this accounting standard, and consistent with the individual and consolidated interim accounting information taken as a whole.
The accompanying individual and consolidated interim financial information has been translated into English for the convenience of readers outside Brazil.
São Paulo, February 11, 2021.
BDO RCS Auditores Independentes SS
CRC 2 SP 013846/O-1
Franc isc o de Paula dos Reis Júnior AccountantCRC 1 SP 139268/O-6
4
Biosev S.A.
(Convenience Translation into English from the Original Previously Issued in Portuguese)
BALANCE SHEET
AS AT DECEMBER 31, 2020
(In thousands of Brazilian reais - R$)
Com pany
Cons olidate d
Com pany
Cons olidate d
ASSETS | Note | 12.31.20 | 03.31.20 | 12.31.20 | 03.31.20 | LIABILITIES AND EQUITY | Note | 12.31.20 | 03.31.20 | 12.31.20 | 03.31.20 |
CURRENT ASSETS | CURRENT LIABILITIES | ||||||||||
Cash and cash equivalents | 3 | 141,536 | 396,124 | 484,178 | 1,174,943 | Borrow ings and financing | 16 | 1,318,124 | 2,935,559 | 3,058,308 | 7,225,234 |
Short-term investments | 4 | 71,453 | 42,052 | 119,732 | 52,245 | Lease liabilities | 12.2 | 207,270 | 215,257 | 561,217 | 498,932 |
Derivative financial instruments | 26 | 92,157 | 225,787 | 105,423 | 225,787 | Advances from domestic customers | 16,977 | 7,611 | 21,311 | 28,128 | |
Trade receivables | 5 | 158,455 | 210,771 | 265,477 | 202,050 | Advances from foreign customers | 270,497 | 968,764 | 462,881 | 2,585,641 | |
Inventories | 6 | 426,221 | 1,105,650 | 864,170 | 2,948,633 | Trade payables | 17 | 287,643 | 309,104 | 663,105 | 798,903 |
Biological assets | 7 | 691,173 | 303,621 | 1,275,757 | 663,908 | Accrued payroll and related taxes | 48,704 | 47,218 | 93,903 | 90,483 | |
Recoverable taxes | 8 | 56,357 | 50,274 | 144,704 | 158,777 | Taxes payable | 18 | 13,891 | 21,314 | 57,000 | 75,152 |
Other receivables | 47,456 | 44,364 | 95,235 | 88,170 | Derivative financial instruments | 26 | 120,108 | 575,188 | 231,324 | 586,843 | |
1,684,808 | 2,378,643 | 3,354,676 | 5,514,513 | Other payables | 51,840 | 80,594 | 94,961 | 118,051 | |||
Assets held for sale | 10 | 26,674 | 45,165 | 26,674 | 45,165 | Total current liabilities | 2,335,054 | 5,160,609 | 5,244,010 | 12,007,367 | |
Total current assets | 1,711,482 | 2,423,808 | 3,381,350 | 5,559,678 | |||||||
NON-CURRENT ASSETS | |||||||||||
Long-term receivables | |||||||||||
Long-term investments | 4 | - | - | 8,217 | - | NON-CURRENT LIABILITIES | |||||
Advances to suppliers | 41,221 | 34,719 | 65,055 | 56,602 | Borrow ings and financing | 16 | 1,696,519 | 67,484 | 3,856,252 | 96,191 | |
Escrow deposits | 9 | 130,360 | 192,166 | 284,956 | 385,413 | Lease liabilities | 12.2 | 629,008 | 516,857 | 1,574,048 | 1,182,337 |
Recoverable taxes | 8 | 10,788 | 11,502 | 80,409 | 57,529 | Advances from foreign customers | 20 | 500,153 | 802,505 | - | 626,116 |
Derivative financial instruments | 26 | - | - | - | 55,885 | Trade payables | 17 | 4,286 | 5,733 | 4,529 | 5,965 |
Deferred income tax and social contribution | 11.1 | 78,609 | 418,029 | 389,423 | 872,971 | Deferred income tax and social contribution | 11.1 | - | - | 35,384 | 36,883 |
Other receivables | 304,196 | 335,939 | 305,606 | 320,012 | Derivative financial instruments | 26 | - | - | 10,594 | 16,596 | |
Lease asset use right | 12.1 | 786,610 | 700,306 | 1,983,844 | 1,577,379 | Provision for tax, labor, civil and enviromental contingencies | 19 | 106,912 | 108,081 | 290,927 | 294,668 |
Investments | 13 | 1,253,961 | 1,240,462 | 154,547 | 160,393 | Taxes payable | 18 | 18,324 | 18,501 | 18,324 | 18,501 |
Property, plant and equipment | 14 | 1,509,156 | 1,635,433 | 3,142,165 | 3,477,391 | Other payables | 72,576 | 86,047 | 149,070 | 167,247 | |
Intangible assets | 15 | 7,998 | 11,856 | 917,460 | 921,964 | Provision for investment loss | 13 | 947,760 | 1,251,234 | - | - |
Total non-current assets | 4,122,899 | 4,580,412 | 7,331,682 | 7,885,539 | Total non-current liabilities | 3,975,538 | 2,856,442 | 5,939,128 | 2,444,504 | ||
EQUITY | |||||||||||
Capital | 6,077,674 | 6,077,674 | 6,077,674 | 6,077,674 | |||||||
Capital reserve | 1,353,937 | 1,353,937 | 1,353,937 | 1,353,937 | |||||||
Accumulated losses | (8,167,310) | (8,167,310) | (8,167,310) | (8,167,310) | |||||||
Profit for the period | 453,998 | - | 453,998 | - | |||||||
Other comprehensive loss | (194,510) | (277,132) | (194,510) | (277,132) | |||||||
Total equity attributable to the Company's owners | (476,211) | (1,012,831) | (476,211) | (1,012,831) | |||||||
Non-controlling interests | - | - | 6,105 | 6,177 | |||||||
Total equity | (476,211) | (1,012,831) | (470,106) | (1,006,654) | |||||||
TOTAL ASSETS | 5,834,381 | 7,004,220 | 10,713,032 | 13,445,217 | TOTAL LIABILITIES AND EQUITY | 5,834,381 | 7,004,220 | 10,713,032 | 13,445,217 |
The accompanying notes are an integral part of these interim financial statements.
Biosev S.A.
(Convenience Translation into English from the Original Previously Issued in Portuguese)
STATEMENT OF OPERATIONS FORTHETHREE-ANDNINE-MONTHPERIODSENDEDDECEMBER31,2020
(In thousands of Brazilian reais - R$)
Com pany
Cons olidate d
Three-month period | Nine-month period | Three-month period | Nine-month period |
ended | ended | ended | ended |
Note | 12.31.20 | 12.31.19 | 12.31.20 | 12.31.19 | 12.31.20 | 12.31.19 | 12.31.20 | 12.31.19 | |
NET REVENUE | 21 | 874,886 | 657,388 | 3,108,597 | 2,478,884 | 2,868,662 | 1,389,546 | 8,522,891 | 4,660,369 |
Cost of sales and services | 21 and 22 | (629,331) | (588,450) | (2,038,416) | (2,003,833) | (2,238,320) | (1,217,363) | (6,464,952) | (3,995,806) |
GROSS PROFIT | 245,555 | 68,938 | 1,070,181 | 475,051 | 630,342 | 172,183 | 2,057,939 | 664,563 | |
OPERATING INCOME (EXPENSES) | 35,918 | (47,634) | 132,122 | (503,667) | (282,992) | (122,550) | (661,760) | (374,478) | |
General, administrative and selling expenses | 22 | (56,281) | (64,319) | (165,330) | (171,333) | (175,405) | (128,028) | (505,624) | (388,863) |
Equity in subsidiaries | 13 | 146,131 | (10,922) | 364,304 | (394,203) | (2,816) | (3,412) | (6,724) | (10,054) |
Other operating income | 24 | 7,406 | 7,098 | 19,210 | 88,657 | 19,292 | 14,621 | 36,463 | 187,254 |
Other operating expenses | 24 | (61,338) | 20,509 | (86,062) | (26,788) | (124,063) | (5,731) | (185,875) | (162,815) |
OPERATINGINCOME(LOSS) BEFOREFINANCEINCOME(COSTS) | 281,473 | 21,304 | 1,202,303 | (28,616) | 347,350 | 49,633 | 1,396,179 | 290,085 | |
Finance income | 23 | 4,962 | 7,276 | 14,709 | 20,557 | 2,616 | 10,302 | 18,181 | 32,000 |
Finance costs | 23 | (74,081) | (68,318) | (235,046) | (281,328) | (141,361) | (143,179) | (454,872) | (519,203) |
Derivatives | 23 | (42,148) | 38,814 | (293,354) | 20,620 | (130,494) | 1,403 | (37,393) | (47,420) |
Exchange rate changes | 23 | 289,271 | 77,816 | 10,199 | (105,750) | 559,660 | 180,321 | (33,699) | (206,126) |
INCOME (LOSS) BEFORE TAXES | 459,477 | 76,892 | 698,811 | (374,517) | 637,771 | 98,480 | 888,396 | (450,664) | |
INCOME TAX AND SOCIAL CONTRIBUTION | 11.2 | (147,863) | (73,935) | (244,813) | (95,600) | (326,154) | (95,623) | (434,496) | (19,708) |
PROFIT (LOSS) FOR THE PERIOD | 311,614 | 2,957 | 453,998 | (470,117) | 311,617 | 2,857 | 453,900 | (470,372) | |
Attributable to: | |||||||||
Company's ow ners | 25 | 311,614 | 2,957 | 453,998 | (470,117) | 311,614 | 2,957 | 453,998 | (470,117) |
Non-controlling interests | - | - | - | - | 3 | (100) | (98) | (255) | |
EARNINGS (LOSS) PER SHARE - R$ | |||||||||
Basic | 25 | 0.60186 | 0.06718 | 0.89105 | (1.08402) | 0.60186 | 0.06718 | 0.89105 | (1.08402) |
Diluted | 25 | 0.60186 | 0.06718 | 0.89105 | (1.08402) | 0.60186 | 0.06718 | 0.89105 | (1.08402) |
The accompanying notes are an integral part of these interim financial statements. |
Biosev S.A.
(Convenience Translation into English from the Original Previously Issued in Portuguese)
STATEMENT OF COMPREHENSIVE INCOME (LOSS)
FOR THE THREE- AND NINE-MONTH PERIODS ENDED DECEMBER 31, 2020 (In thousands of Brazilian reais - R$)
Com pany
Cons olidate d
Three-month | Nine-month period | Three-month | Nine-month period |
period ended | ended | period ended | ended |
Note | 12.31.20 | 12.31.19 | 12.31.20 | 12.31.19 | 12.31.20 | 12.31.19 | 12.31.20 | 12.31.19 | |
PROFIT (LOSS) FOR THE PERIOD | 311,614 | 2,957 | 453,998 | (470,117) | 311,617 | 2,857 | 453,900 | (470,372) | |
OTHER COMPREHENSIVE INCOME (LOSS) | |||||||||
Items subsequently reclassified to profit or loss: | |||||||||
Financial instruments - hedge accounting of futures | 26 | (89,295) | (72,120) | (253,925) | (39,323) | (89,295) | (72,120) | (253,925) | (39,323) |
Financial instruments - hedge accounting of Libor sw ap | 26 | 3,919 | 2,455 | 5,363 | (5,191) | 3,919 | 2,455 | 5,363 | (5,191) |
Financial instruments - hedge accounting of Non-Deliverable Forw ard (NDF) | 26 | 159,961 | 50,420 | 293,309 | 29,844 | 159,961 | 50,420 | 293,309 | 29,844 |
Financial instruments - hedge accounting of exchange differences | 26 | - | 32,764 | 79,173 | 266,201 | - | 32,764 | 79,173 | 266,201 |
Deferred income tax and social contribution related to components of other | |||||||||
comprehensive income (loss) | 11.3 | (25,359) | (4,597) | (42,133) | (85,521) | (25,359) | (4,597) | (42,133) | (85,521) |
Equity in investees - other comprehensive income (loss) | 835 | (552) | 835 | (552) | 835 | (552) | 835 | (552) | |
50,061 | 8,370 | 82,622 | 165,458 | 50,061 | 8,370 | 82,622 | 165,458 | ||
COMPREHENSIVE INCOME (LOSS) FOR THE PERIOD | 361,675 | 11,327 | 536,620 | (304,659) | 361,678 | 11,227 | 536,522 | (304,914) | |
Attributable to: | |||||||||
Company's ow ners | 361,675 | 11,327 | 536,620 | (304,659) | 361,675 | 11,327 | 536,620 | (304,659) | |
Non-controlling interests | - | - | - | - | 3 | (100) | (98) | (255) | |
The accompanying notes are an integral part of these interim financial statements. |
Biosev S.A.
(Convenience Translation into English from the Original Previously Issued in Portuguese)
STATEMENT OF CHANGES IN EQUITY
FOR THE NINE-MONTH PERIOD ENDED DECEMBER 31, 2020 (In thousands of Brazilian reais - R$)
Assessable capital | Total consolidated | ||||||
Capital | s tock | Capital reserve | Accumulated losses | Company's equity | e quity | ||
BALANCES AS AT MARCH 31, 2019 | 6,077,674 | 1,353,937 | (287,906) | (6,617,139) | 526,566 | 6,280 | 532,846 |
Loss for the period | - | - | - | (470,117) | (470,117) | (255) | (470,372) |
Adjusted derivatives (hedge accounting), net of taxes | - | - | 165,458 | - | 165,458 | - | 165,458 |
Comprehensive income (loss) for the period | - | - | 165,458 | (470,117) | (304,659) | (255) | (304,914) |
Non-controlling interest | - | 55 | 55 | ||||
Dissolution of indirect subsidiary | - | - | - | 919 | 919 | - | 919 |
BALANCES AS AT DECEMBER 31, 2019 | 6,077,674 | 1,353,937 | (122,448) | (7,086,337) | 222,826 | 6,080 | 228,906 |
BALANCES AS AT MARCH 31, 2020 | 6,077,674 | 1,353,937 | (277,132) | (8,167,310) | (1,012,831) | 6,177 | (1,006,654) |
Profit (loss) for the period | - | - | - | 453,998 | 453,998 | (98) | 453,900 |
Other comprehensive income | - | - | 82,622 | - | 82,622 | - | 82,622 |
Comprehensive income (loss) for the period | - | - | 82,622 | 453,998 | 536,620 | (98) | 536,522 |
Non-controlling interest | - | - | - | - | - | 26 | 26 |
BALANCES AS AT DECEMBER 31, 2020 | 6,077,674 | 1,353,937 | (194,510) | (7,713,312) | (476,211) | 6,105 | (470,106) |
The accompanying notes are an integral part of these interim financial statements. | |||||||
8 |
Non-controlling inte r e s ts
(Convenience Translation into English from the Original Previously Issued in Portuguese)
STATEMENT OF CASH FLOWS
FOR THE NINE-MONTH PERIOD ENDED DECEMBER 31, 2020 (In thousands of Brazilian reais - R$)
Com pany Nine-month period ended
NoteCons olidate dNine-month period ended
12.31.20
12.31.19
12.31.20
12.31.19
CASH FLOW FROM OPERATING ACTIVITIES Profit (loss) for the period
Non-cash transactions:
Depreciation and amortization
Income (loss) from sale of property, plant and equipment Investments sold
Equity in subsidiaries
Interest, exchange rate changes and inflation adjustments, net Exchange, interest rate and commodities risk management
Recognition of provision for tax, labor, civil and enviromental contingencies Recognition (reversal) of estimated losses on doubtful accounts Derecognition of intangible assets
Reversal of impairment loss Impairment of assets held for sale
Provision for other losses
Recognition (reversal) of allow ance for negative margin and
realization of storeroom inventories
Gains on changes in fair value less estimated costs to sell biological assets Deferred income tax and social contribution
Hedge operations
Derecognition of operating leases Dissolution of indirect subsidiary
Decrease (increase) in assets:
Trade receivables Inventories
Derivative financial instruments Escrow deposits
Recoverable taxes Advances to suppliers Other receivables
Increase (decrease) in liabilities:
Trade payables
Advances from foreign customers Accrued payroll and related taxes Taxes payable
Advances from domestic customers
Payments of labor, civil, tax and environmental contingencies Derivative financial instruments
Other payables
Cash used in operating activities, net interest Interest on borrow ings and financing
Cash provided by operating activities
CASH FLOW FROM INVESTING ACTIVITIES
Decrease (increase) in short- and long-term investments
Decrease (increase) in investments (provision for investment loss) Additions to lease agreements
Increase in property, plant and equipment Additions to biological assets
Additions to intangible assets
Cash provided by investing activities
CASH FLOW FROM FINANCING ACTIVITIES
Additions to lease operations Shareholders' contributions Borrow ings and financing
Payment of borrow ings and financing
Cash provided by (used in) financing activities
DECREASE IN CASH AND CASH EQUIVALENTS
Cash and cash equivalents at the beginning of the period Cash and cash equivalents at the end of the period
Non-cash items
Transfer of depreciation and amortization to inventories
Transfer of assets and liabilities to held for sale - Estivas plant Acquisition of financed property, plant and equipment
The accompanying notes are an integral part of these interim financial statements.
453,998 (470,117)
22 24
453,900
814,314
719,307 1,654,121
(470,372)
1,419,049
7,403 -(407)
5,025 (6,436)
62,418
- 62,418
13
(363,469)
393,651
7,559 9,502
168,044
252,455
392,396 573,361
81,679
138,744
(29,660) 144,629
9,795 (25,829)
5
47,361 14,761
(30)
747 (466) 1,002
15
264 (3,518)
-
374
-
24
(555) 773 (1,976)
10
(119) (53,374)
24 6
(119) (53,374)
39 730
168
13,937 59,702
(5,932)
(4,937) (18,097)
21 and 22 11.2
(594,047)
(152,114)
(927,443) (247,305)
5,715 - 1,002,006
251,354
169,854
176,664
95,600
5,898
439,916 20,291 123,920 251,531 11,584 6,908
919 1,138,243
26 2,188,267
974 1,766,568
5
52,827 833,353 133,630 61,806
(52,194)
(62,282)
6
(15,016) 2,316,646
26
(61,690)
(1,011,400)
(47,955) (22,108)
176,249 (53,061)
9
100,457 (63,378)
8
(5,369) 33,004
(6,502) 28,612
(8,807) 6,715
(2,006) (24,343)
(8,453) (20,037)
(6,596) (38,248)
1,098,357
(130,618) 2,507,214
(1,241,099)
17
(22,830)
(88,411) (137,104)
(1,000,619)
(23,095) (2,748,876)
1,486
(171,458) 583,667
(3,446)
3,420 (3,475)
18
(7,600)
(9,603)
(18,329) (15,668)
9,366
1,964
(6,817) 22,606
19 26.1
(10,964)
(3,826)
(51,102) (15,517)
(536,759)
(267,416)
(331,861) (267,503)
(42,225) 2,389
(41,267) 10,592
(1,610,145)
490,218 (95,921) 394,297
(391,444)
616,181 (130,362) 485,819
(3,331,936) 143,244 1,363,545 668,713
(230,924)
(293,838)
1,132,621 374,875
4
(29,233)
(17,603)
(75,146) 74,458
13
47,331
(149,694)
(878) 569
12
(249,065)
(765,422)
(791,394) (1,814,492)
14
(231,167)
(161,792)
(436,119) (348,736)
7
(236,191)
(218,502)
(412,222) (376,651)
15
(482)
(8,829)
(929) (9,836)
(698,807)
(1,321,842)
(1,716,688)
(2,474,688)
12 12 16 16
197,275 (123,926) 655,621 (679,048)
(1,070,400)
766,207 (166,631) 809,392
792,379 (436,432) 1,227,667 (1,690,312)
1,815,411 (394,816) 2,176,427 (2,483,462)
49,922
338,568
(106,698) 1,113,560
(254,588)
(497,455)
(690,765) (986,253)
3 3
396,124 141,536
577,523 1,174,943
1,189,112
80,068
484,178 202,859
(27,424)
5,533
(24,633) 177,966
18,609 -
(3,473) 24,271
18,609 (6,978)
6,160 51,235
(Convenience Translation into English from the Original Previously Issued in Portuguese)
STATEMENT OF VALUE ADDED
FOR THE NINE-MONTH PERIOD ENDED DECEMBER 30, 2020
(In thousands of Brazilian reais - R$)
Com pany | Cons olidate d |
Nine-month period | Nine-month period |
ended | ended |
Note | |||
1 - REVENUE | |||
1.1) Sales | 21 | ||
1.2) Reversal of estimated losses on doubtful accounts | 24 | ||
1.3) Other operating income | 24 | ||
2 - INPUTS PURCHASED FROM THIRD PARTIES | |||
2.1) Cost of sales and services | |||
2.2) Materials, electric pow er, external services and other | |||
2.3) Gains on changes in fair value of biological assets and other | |||
3 - GROSS VALUE ADDEED (1-2) | |||
4 - DEPRECIATION AND AMORTIZATION | 22 | (814,314) | (719,307) |
5 - VALUE ADDED CREATED BY THE ENTITY (3-4) | 1,260,660 | 889,705 | |
6 - VALUE ADDED RECEIVED IN TRANSFER | 379,013 | (373,646) | |
6.1) Equity in subsidiaries | 13 | 364,304 | (394,203) |
6.2) Finance income | 14,709 | 20,557 | |
7 - VALUE ADDED FOR DISTRIBUTION (5+6) | 1,639,673 | 516,059 | |
8 - DISTRIBUTION OF VALUE ADDED | 1,639,673 | 516,059 | |
8.1) Personnel and payroll taxes | 22 | 198,205 | 220,743 |
Direct compensation | 140,062 | 158,165 | |
Benef its | 43,581 | 43,993 | |
Severance pay fund (FGTS) | 14,562 | 18,585 | |
8.2) Taxes, rates and contributions | 330,415 | 257,432 | |
Federal | 268,440 | 151,988 | |
State | 61,883 | 105,442 | |
Municipal | 92 | 2 | |
8.3) Third-party capital use | 657,054 | 508,001 | |
Rentals | 138,853 | 141,543 | |
Interest and exchange rate changes | 518,201 | 366,458 | |
8.4) Equity capital | 453,998 | (470,117) | |
Pofit (loss) for the period | 453,998 | (470,117) | |
The accompanying notes are an integral part of these interim financial statements. |
12.31.20 | 12.31.19 | |
8,748,960 | 5,201,730 | |
8,712,031 | 5,015,478 | |
466 | (1,002) | |
36,463 | 187,254 | |
(4,677,665) | (2,366,554) | |
(237,518) (167,510) | (1,249,785) | (894,947) |
(1,483,906) (1,099,313) | (4,355,322) | (1,718,911) |
594,049 152,113 | 927,442 | 247,304 |
2,074,974 1,609,012 | 4,071,295 | 2,835,176 |
(1,654,121) | (1,419,049) | |
2,417,174 | 1,416,127 | |
11,457 | 21,946 | |
(6,724) | (10,054) | |
18,181 | 32,000 | |
2,428,631 | 1,438,073 | |
2,428,631 | 1,438,073 | |
481,534 | 450,951 | |
345,121 | 311,051 | |
104,603 | 99,939 | |
31,810 | 39,961 | |
635,109 | 379,609 | |
537,600 | 192,535 | |
97,330 | 186,917 | |
179 | 157 | |
858,088 | 1,077,885 | |
332,124 | 305,136 | |
525,964 | 772,749 | |
453,900 | (470,372) | |
453,900 | (470,372) |
12.31.20
12.31.19
3,202,349 2,723,722
3,183,109 2,635,812
30 19,210
(747) 88,657
(1,127,375) (1,114,710)
10
Biosev S.A.
Notes to the Interim Financial Statements
For the Nine-month Period Ended December 31, 2020 (Amounts in thousands of Brazilian reais, unless otherw ise stated)
1.
GENERAL INFORMATION
Biosev S.A. ("Company"), a publicly-held company headquartered at Avenida Brigadeiro Faria Lima, 1355, 11º andar,
Pinheiros, São Paulo, SP, and its subsidiaries (hereinafter referred to as, collectively, "Group") are mainly engaged in the production, processing and sale of agricultural products, primarily sugarcane and its by-products; the agricultural operations inCompany-ownedorthird-partyland;theexport,importandsaleofpetroleumby-products,lubricants,fuel,greaseand hydrated ethyl alcohol; the purchase, sale, import and export of agricultural products and its by-products; and the generation and sale of electricity and its by-products.
The Group comprises the activities of Biosev S.A. and Biosev Bioenergia S.A. ("Biosev Bioenergia"), based in Brazil, and Biosev Bioenergia International S.A. ("Biosev Bioenergia International"), based in Sw itzerland. Additionally, the Group consists of the subsidiaries of such companies, including Biosev Comercializadora S.A., a special-purpose entity established to sell ethanol by-products, sugar and electric pow er arising from the cogeneration assets of the Santa Elisa and Passa Tempo units, located in the State of São Paulo and State of Mato Grosso do Sul, respectively.
The Group is organized in industrial clusters, composed as follow s, w ith their corresponding branches:
• North Ribeirão Preto Agri-Industrial Cluster: Continental (located in the State of São Paulo) and Lagoa da Prata (located in the State of Minas Gerais) plants;
• South Ribeirão Preto Agri-Industrial Cluster: Santa Elisa, Leme, Vale do Rosário and MB (Morro Agudo) (located in the State of São Paulo) plants;
• Mato Grosso do Sul Agri-Industrial Cluster: Passa Tempo and Rio Brilhante (located in the State of Mato Grosso do Sul) plants;
The Company is a subsidiary of the Louis Dreyfus Company Group, directly controlled by Hédera Investimentos e Participações Ltda., w hich holds 79.43% of its shares.
The Company's Management had adopted measures to adjust the debt profile. Specifically, the Company has maintained its strategy to maximize the use of its assets, aligned w ith strict financial discipline, in order to increase the operationa l efficiency and the generation of positive free cash flow .
The Company recorded net profit of R$453,998 in the nine-month period ended December 31, 2020. The Company's capacity to continue as a going concern depends on the obtaining of additional capital, renew al and extension of the credit facilities and, finally, generation of profitable transactions, similarly to this period to reverse the historical losses incurred over the last years. Specifically, the Company's and its subsidiaries' debt levels may significantly impact the business, inclusive in relation to w orking capital financing and recurring capital disbursements, taking into account the necessary funds to pay the debt service.
Although there is no guarantee that the Company willbe able to generate sufficientcash flow tofinance the transactions and pay its debt, Management continues to implement actions to improve the operational activities and reduce costs and expenses, in addition to the negotiations in progress w ith the financial institutions that historically have supported the
Company's activities. The Company's Management expects that the improvement actions, current cash balances, favorable liquidity developments and available credit facilities, and results from operations are sufficient to meet the w orking capital, capital expenses, debt service and other needs for the next year.
Should the Company is not able to generate sufficient cash to conduct the transactions in progress, the Company may need to seek for additional debt financing. The Company may fully or partially refinance its debt, w hich may be more costly, in addition to all other impacts.
Covid-19 effects
InconnectionwiththefinancialstatementsasatMarch31,2020,theCompanycontinuestocomplywithallguidelinesto prevent Covid-19 disclosed by the proper health bodies and maintain the measures to mitigate the risk of transmission of Covid-19 in workplaces.
Although the pandemic has not been fully eradicated, the Brazilian authorities began to loosen the restrictions, and the Company believes that the pandemic effects in the global economy has begun to be mitigated. As of the date, the Company has not identified significant effects on its operations; therefore, the Company has maintained the estimated production, sales and delivery of products. The agro industrial sector is deemed an essential activity by virtue of the essential supplies
Biosev S.A.
Notes to the Interim Financial Statements
For the Nine-month Period Ended December 31, 2020 (Amounts in thousands of Brazilian reais, unless otherw ise stated)
produced to the population, relating to the meal and transportation segments. In addition, there w as no change in the measurement of the economic and financial impacts from Covid-19, as disclosed in the financial statements as at March 31, 2020.
2. SUMMARY OF SIGNIFICANT ACCOUNTING PRACTICES
2.1 Statement of compliance and basis of preparation
The individual and consolidated interim financial statements have been prepared and is presented in accordance w ith CPC 21 (R1) - Interim Financial Reporting and IAS 34 - Interim Financial Reporting issued by the International Accounting Standards Board (IASB).
These interim financial statements are presented in accordance w ith the standards issued by the Brazilian Securities and Exchange Commission (CVM), applicable to the preparation of Interim Financial Information (ITR).
The preparation of the individual and consolidated financial statements under CPC 21 (R1) and IAS 34 requires the use of certain critical accounting estimates by the Company's Management. The interim financial statements have been prepared based on the historical cost, except for certain financial instruments, held-for-sale assets and biological assets measured at their fair values. The historical cost is generally based on the fair value of the consideration paid in exchange for assets on the transaction date.
Management undertakes that all relevant information related to the interim financial statements, and only such information, is being highlighted and corresponds to the information used by Management in its management.
The accounting practices and the methods for calculation of estimates used in the preparation of these interim financial statements are the same accounting practices and methods used in the preparation of the Company's financial statements as at March 31, 2020, filed w ith CVM and, therefore, must be read jointly.
2.1.1 New and revised standards and interpretations
Leases - CPC 06 (R2)/IFRS 16
Such pronouncement has been changed by virtue of the benefits granted relating to COVID-10 to the lessees in connection w ith the lease agreements. The Company analyzed the contents of this pronouncements and has not identified impacts, as the clauses of the lease agreements in forceremained unchanged.
3.
CASH AND CASH EQUIVALENTS
Com pany
Cons olidate d
12.31.20 | 03.31.20 | 12.31.20 | 03.31.20 | |
Cash and banks | 31,743 | 21,625 | 354,623 | 364,024 |
Short-term investments | 2,973 | 3,004 | 22,735 | 41,792 |
Debentures | 106,820 | 371,495 | 106,820 | 769,127 |
141,536 | 396,124 | 484,178 | 1,174,943 |
Short- and long-term investments refer to floating rate Certificates of Bank Deposit (CDBs) and/or CDBs indexed at rates ranging from 95% to 100% of the Interbank Deposit Rate (CDI) as at December 31, 2020 (95% to 96% as at March 31, 2020). The CDBs investments are subject to repurchase commitments by the financial institutions issuers and/or custodians.
Debentures not subject to Tax on Financial Transactions (IOF) are issued from local prime financial institutions indexed at 73% of the CDI rate as at December 31, 2020 (73% to 80% as at March 31, 2020).
Biosev S.A.
Notes to the Interim Financial Statements
For the Nine-month Period Ended December 31, 2020 (Amounts in thousands of Brazilian reais, unless otherw ise stated)
4.
SHORT- AND LONG-TERM INVESTMENTS
Com pany
Cons olidate d
12.31.20 | 03.31.20 | 12.31.20 | 03.31.20 | |
Short-term investments | 71,453 | 42,052 | 127,949 | 52,245 |
Current assets | 71,453 | 42,052 | 119,732 | 52,245 |
Non-current assets | - | - | 8,217 | - |
Short- and long-term investments refer to restricted deposits and are operations represented by (i) floating rate Certificates of Bank Deposit (CDBs) and/or CDBs indexed at rates ranging from 95% to 100% of the Interbank Deposit Rate (CDI) as at December 31, 2020 (95% to 96% as at March 31, 2020); (ii) margin deposits in derivative transactions; and (iii) foreign currency-denominated deposits related to prepayments of exports indexed at average rate of 0.10% p.a. performed by subsidiary Biosev Bioenergia Internacional S.A. These deposits may be considered, together with future agricultural production and sugar and ethanol inventories, for purposes of calculation of the indices set forth in the prepaid export agreements.
5.
TRADE RECEIVABLES
Com pany
Cons olidate d
12.31.20 | 03.31.20 | |||
Related parties (Note 20) | ||||
In Brazil | 8,463 | 7,498 | - | - |
Abroad | 83,852 | 133,503 | 4,613 | 2,505 |
92,315 | 141,001 | 4,613 | 2,505 | |
Third parties | ||||
In Brazil | 66,731 | 67,955 | 181,466 | 191,167 |
Abroad | 145 | 2,581 | 93,124 | 22,570 |
66,876 | 70,536 | 274,590 | 213,737 | |
159,191 | 211,537 | 279,203 | 216,242 | |
(-) Estimated loss for doubtful accounts | (736) | (766) | (13,726) | (14,192) |
158,455 | 210,771 | 265,477 | 202,050 |
12.31.20
03.31.20
The aging list of overdue receivables is as follow s:
Com pany
Cons olidate d
12.31.20 | 03.31.20 | 12.31.20 | 03.31.20 | |
Overdue | ||||
Up to 30 days | 1,981 | 24,648 | 67,905 | 3,457 |
31 to 60 days | 18,403 | 2,083 | 148 | 6,462 |
61 to 90 days | 5 | 20,887 | 44 | 452 |
91 to 180 days | 1 | 20,455 | 33 | 325 |
Over 180 days | 876 | 17,001 | 16,242 | 16,874 |
21,266 | 85,074 | 84,372 | 27,570 |
The change in the estimated loss for doubtful accounts is as follow s:
Com pany
Cons olidate d
12.31.20 | 03.31.20 | 12.31.20 | 03.31.20 | |
At the beginning of the | (766) | (175) | (14,192) | (13,395) |
Reversal (recognition) of | ||||
30 | (591) | 466 | (797) | |
estimated loss for doubtful | ||||
(736) | (766) | (13,726) | (14,192) |
Biosev S.A.
Notes to the Interim Financial Statements
For the Nine-month Period Ended December 31, 2020 (Amounts in thousands of Brazilian reais, unless otherw ise stated)
6.
INVENTORIES
Com pany
Cons olidate d
12.31.20 | 03.31.20 | 12.31.20 | 03.31.20 | |
Finished products | ||||
Sugar | 42,458 | 4,218 | 91,040 | 14,838 |
Ethanol | 236,075 | 20,676 | 491,359 | 79,839 |
Sugar syrup | 959 | 317 | 3,258 | 1,241 |
Other | 98 | 247 | 277 | 331 |
Allow ance for negative inventory margin | (2,093) | (3,298) | (8,733) | (18,985) |
277,497 | 22,160 | 577,201 | 77,264 | |
Raw materials and packaging materials | 1,239 | 1,033 | 1,298 | 1,166 |
Storeroom supplies | 47,021 | 37,492 | 96,308 | 76,476 |
Allow ance for realization of storeroom | ||||
(6,054) | (4,119) | (12,412) | (7,097) | |
inventories | ||||
Advances to suppliers (*) | 106,518 | 1,049,084 | 201,775 | 2,800,824 |
148,724 | 1,083,490 | 286,969 | 2,871,369 | |
426,221 | 1,105,650 | 864,170 | 2,948,633 |
(**) Out of the total amount as at December 31, 2020, R$94,890, in Company, and R$185,821 in Consolidated (R$105,192 and R$223,699 as at March 31, 2020, respectively), refer to advances to sugarcane suppliers that are adjusted on a monthly basis according to the specific conditions and indices set forth in the agreements, and R$11,628, in Company, and R$15,954 in Consolidated (R$943,892, in Company, and R$2,577,125, in Consolidated, as at March 31, 2020), refer to advances to export of commodities, as described in Note 20.
Thechangesintheallowancefornegativeinventorymarginandrealizationofstoreroominventoriesarebrokendownas follow s:
Com pany
Cons olidate d
12.31.20 | 03.31.20 | 12.31.20 | 03.31.20 | |
Negative inventory margin | ||||
Opening balance | (3,298) | (7,410) | (18,985) | (25,793) |
A dditions | (2,093) | (3,298) | (8,733) | (18,985) |
Reversals | 3,298 | 7,410 | 18,985 | 25,793 |
(2,093) | (3,298) | (8,733) | (18,985) | |
Realization of storeroom inventories | ||||
Opening balance | (4,119) | (3,568) | (7,097) | (5,818) |
A dditions | (6,054) | (4,119) | (12,412) | (7,097) |
Reversals | 4,119 | 3,568 | 7,097 | 5,818 |
(6,054) | (4,119) | (12,412) | (7,097) |
The allow ance for negative inventory margin is calculated by analyzing the average production cost of finished products as compared to their realizable value in the market, less costs to sell.
Theallowanceforrealizationofstoreroominventories,consideringobsoleteandslow-movingitems,isrecognizedona quarterly basis based on inventory management procedure of storeroom inventories duly approved by the Company.
Biosev S.A.
Notes to the Interim Financial Statements
For the Nine-month Period Ended December 31, 2020 (Amounts in thousands of Brazilian reais, unless otherw ise stated)
7.
BIOLOGICAL ASSETS
Com pany
Cons olidate d
12.31.20
03.31.20
12.31.20
03.31.20
Opening balance
663,908 501,124
Increases arising from expenses on sugarcane crops and crop treatments
695,077 1,518,981
1,412,868
303,621 405,015 708,636
264,480 430,597
855,073 911,744
120,821 927,443
222,448
Gains on changes in fair value less estimated costs to sell Transfer to assets held for sale
(490,374) (1,169,750) (945,620)
Sugarcane harvest at fair value in the year/period Wr ite- of f
594,047 904 (612,414)
(13,682)
904 (13,682)
(1,821) (12,106)
1,275,757
663,908
- 691,173
(8,221) 303,621
The follow ing assumptions w ere used to determine the fair value:
Com pany
Cons olidate d
Estimated harvest area (in hectares)
Expected yields (in ton of sugarcane per hectare)
Total volume of recoverable sugar (in kilogram per ton of sugarcane)
Value of a kilogram of total recoverable sugar (in R$) - CONSECANA Discount rate
12.31.20 | 03.31.20 | 12.31.20 | 03.31.20 |
126,956 | 123,816 | 223,958 | 222,421 |
88.50 | 85.88 | 90.14 | 89.07 |
129.56 | 126.29 | 132.15 | 129.90 |
0.87 | 0.66 | 0.87 | 0.66 |
8.57% | 10.21% | 8.57% | 10.21% |
As at December 31, 2020, the Company provided as guarantee for the export prepayment 158,608 hectares (158,608 hectares as at March 31, 2020), equivalent to approximately 14,296,164 tons of sugarcane (14,127,348 as at March 31, 2020), at fair value of R$903,496 (R$473,432 as at March 31, 2020). Such prepayment falls due betw een March 2023 and April 2023.
8.
RECOVERABLE TAXES
Com pany
Cons olidate d
prepayments |
Tax on manufactured products (IPI) and other taxes |
Current assets |
Non-current assets |
12.31.20 | 03.31.20 | 12.31.20 | 03.31.20 | |
State VAT (ICMS) | 53,746 | 39,859 | 79,466 | 60,952 |
Taxes on revenue (PIS and COFINS) (a) | 3,409 | 16,166 | 55,468 | 75,050 |
Witholding Income Tax (IRRF) on short-term investments and | ||||
7,112 | 2,978 | 62,954 | 55,466 | |
2,878 | 2,773 | 27,225 | 24,838 | |
67,145 | 61,776 | 225,113 | 216,306 | |
56,357 | 50,274 | 144,704 | 158,777 | |
10,788 | 11,502 | 80,409 | 57,529 |
(a) Refers to taxes on revenues (PIS and COFINS) relating to: (i) Law 10637/02; (ii) Law 10833/03; (iii) Law 11774/200; and (iv) Law 13043/14.
Biosev S.A.
Notes to the Interim Financial Statements
For the Nine-month Period Ended December 31, 2020 (Amounts in thousands of Brazilian reais, unless otherw ise stated)
9.
The changes in the Company's escrow deposits are as follow s:
Com pany
Cons olidate d
ESCROW DEPOSITS | ||||
12.31.20 | 03.31.20 | 12.31.20 | 03.31.20 | |
Civil | 2,244 | 3,500 | 4,007 | 7,365 |
Environmental | 2,284 | 2,442 | 7,133 | 7,548 |
4,528 | 5,942 | 11,140 | 14,913 | |
Tax | ||||
Tax on manufactured products (IPI) | - | - | 18,799 | 18,673 |
Income tax (IRPJ) and social contribution (CSLL) | 16,335 | 16,235 | 33,388 | 33,262 |
ICMS, PIS and COFINS | 9,889 | 9,758 | 40,074 | 46,344 |
Social security contributions | 21,633 | 21,738 | 27,353 | 27,419 |
Other | - | - | 3,047 | 3,054 |
47,857 | 47,731 | 122,661 | 128,752 | |
Tax | ||||
Labor appeals | 77,975 | 138,493 | 151,155 | 241,748 |
77,975 | 138,493 | 151,155 | 241,748 | |
130,360 | 192,166 | 284,956 | 385,413 | |
Cons olidate d |
Com pany
Opening balance | |
Additions | |
Of f sets/redemptions | |
10. | ASSETS AND LIABILITIES HELD FOR SALE |
12.31.20 | 03.31.20 | 12.31.20 | 03.31.20 |
192,166 | 210,108 | 385,413 | 367,388 |
8,594 | 31,563 | 15,729 | 81,534 |
(70,400) | (49,505) | (116,186) | (63,509) |
130,360 | 192,166 | 284,956 | 385,413 |
Com pany
Consolidated
12.31.20 26,674 26,674
03.31.20 45,165 45,165
12.31.20
03.31.20
Assets held for sale
26,674 45,165
26,674 45,165
The breakdow n of assets and liabilities classified as held for sale is as follow s:
MaracajuNoteplant
12.31.20
03.31.20
14 (74,735)Com pany Assets Biological assets Fixed assets Impairment losses Total assets
7 14
- 101,409
- 101,408 (74,734)
904 119,114 (74,853)
26,674
26,674
45,165
Biosev S.A.
Notes to the Interim Financial Statements
For the Nine-month Period Ended December 31, 2020 (Amounts in thousands of Brazilian reais, unless otherw ise stated)
11. CURRENT AND DEFERRED INCOME TAX AND SOCIAL CONTRIBUTION
11.1 Deferred income tax and social contribution assets and liabilities disclosed in balance sheet
Com pany
Cons olidate d
12.31.20 | 03.31.20 | 12.31.20 | 03.31.20 | |
Deferred income tax and social contribution assets | 78,609 | 418,029 | 389,423 | 872,971 |
Deferred income tax and social contribution liabilities | - | - | (35,384) | (36,883) |
78,609 | 418,029 | 354,039 | 836,088 |
11.2
Income tax and social contribution recognized in profit or loss for the period
Com panyThree-month period endedNine-month period ended
12.31.20
12.31.19
12.31.19
Results from current income tax and social contribution
Results from deferred income tax and social contribution related to the origin and reversal of temporary differences and tax loss carryforw ards
12.31.20 | |||
- | - | 6,541 | - |
(147,863) | (73,935) | (251,354) | (95,600) |
(147,863) | (73,935) | (244,813) | (95,600) |
Cons olidate dThree-month period endedNine-month period ended
12.31.20
12.31.19
12.31.20
12.31.19
Results from current income tax and social contribution
1,581
602
5,421
583
Results from deferred income tax and social contribution related to the origin and reversal of temporary differences and tax loss carryforw ards
(327,735) (96,225) (439,917) (20,291)
(326,154) (95,623) (434,496) (19,708)
11.3 Income tax and social contribution recognized in other comprehensive income (loss)
Com panyThree-month period endedNine-month period ended
12.31.20 | 12.31.19 | 12.31.20 | 12.31.19 | |
Results from deferred income tax and social contribution recognized in other | ||||
comprehensive income (loss): | ||||
Financial instruments - hedge accounting of futures | 11,660 | 16,416 | 33,816 | 14,709 |
Financial instruments - hedge accounting of Non-Deliverable Forw ard (NDF) | (14,035) | (4,544) | (121,883) | (2,309) |
Financial instruments - hedge accounting of exchange differences | - | (11,141) | - | (23,054) |
(2,375) | 731 | (88,067) | (10,654) | |
Effects on subsidiaries | (22,984) | (5,328) | 45,934 | (74,867) |
(25,359) | (4,597) | (42,133) | (85,521) |
Biosev S.A.
Notes to the Interim Financial Statements
For the Nine-month Period Ended December 31, 2020 (Amounts in thousands of Brazilian reais, unless otherw ise stated)
Cons olidate dThree-month period endedNine-month period ended
12.31.20 | 12.31.19 | 12.31.20 | 12.31.19 | |
Results from deferred income tax and social contribution recognized in other | ||||
comprehensive income (loss): | ||||
Financial instruments - hedge accounting of futures | 30,360 | 24,521 | 86,334 | 13,370 |
Financial instruments - hedge accounting of Sw ap Libor | (1,332) | (835) | (1,823) | 1,765 |
Financial instruments - hedge accounting of Non-Deliverable Forw ard (NDF) | (54,387) | (17,143) | (99,725) | (10,147) |
Financial instruments - hedge accounting of exchange differences | - | (11,140) | (26,919) | (90,509) |
(25,359) | (4,597) | (42,133) | (85,521) |
11.4 Reconciliation of income tax and social contribution expenses at statutory and effective rates
Com panyThree-month period endedNine-month period ended
Results before taxation Statutory rate
Income (loss) from income tax and social contribution at statutory rate Equity in subsidiaries
Unrecognized deferred income tax and social contribution credits Tax revenue (grants)
Accrued income (foreign subsidiary) Subcapitalization rules
Loss from income tax and social contribution at effective rate
Othere
12.31.20 | 12.31.19 | 12.31.20 | 12.31.19 |
459,477 | 76,892 | 698,811 | (374,517) |
34% | 34% | 34% | 34% |
(156,222) | (26,143) | (237,595) | 127,336 |
49,684 | (3,713) | 123,863 | (134,029) |
(17,302) | (31,467) | (100,658) | (82,061) |
7,708 | 4,990 | 20,571 | 25,058 |
(27,930) | (7,508) | (27,930) | (7,508) |
(6,973) | (6,298) | (22,326) | (18,108) |
3,172 | (3,796) | (737) | (6,288) |
(147,863) | (73,935) | (244,812) | (95,600) |
Cons olidate dThree-month period endedNine-month period ended
12.31.20
12.31.19
12.31.20
12.31.19
Results before taxation Statutory rate
637,771 34%
98,480 34%
888,396 34%
(450,664)
34%
(216,842)
(33,483)
(302,054) 153,226
Income (loss) from income tax and social contribution at statutory rate Equity in subsidiaries
(957)
(1,160)
(2,286) (3,418)
(60,964)
(41,923)
(73,443) (145,899)
Unrecognized deferred income tax and social contribution credits Tax revenue (grants)
7,708
4,990
20,571 25,058
(10,979)
101
(945) 5,805
(11,361)
(11,846)
(38,077) (39,801)
Difference rate - foreign subsidiary Accrued income (foreign subsidiary) Subcapitalization rules
(27,930)
(7,508)
(27,930) (7,508)
Other
(4,829)
(4,794)
(10,332) (7,171)
Loss from income tax and social contribution at effective rate
(326,154)
(95,623)
(434,496) (19,708)
Biosev S.A.
Notes to the Interim Financial Statements
For the Nine-month Period Ended December 31, 2020 (Amounts in thousands of Brazilian reais, unless otherw ise stated)
11.5 Balances of deferred income tax and social contribution assets and liabilities
Ope ning | in profit or | Clos ing | ||
balance as at | loss for the | balance as at | ||
Com pany | 03.31.20 | period | 12.31.20 | |
Temporary differences: | ||||
Provision for tax, labor, civil and environmental contingencies | 37,028 | (398) | - | 36,630 |
Adjustment at fair value of biological assets | (16,585) | (152,576) | - | (169,161) |
Other receivables (AVP) | 14,162 | (3,284) | - | 10,878 |
Hedge accounting of Libor sw ap, NDF and exchange rate changes | 63,527 | 74,677 | (88,067) | 50,137 |
Unrealized exchange rate changes | 412,077 | (57,989) | - | 354,088 |
Amortization of tax goodw ill | (245,277) | - | - | (245,277) |
Accelerated depreciation | (39,048) | (21,566) | - | (60,614) |
Impairment of fixed assets | 65,310 | (1,237) | - | 64,073 |
Mark-to-market of derivatives | 2,363 | (94,096) | - | (91,733) |
Impairment of assets held for sales | 10,859 | 6,028 | - | 16,887 |
Other | 11,661 | (912) | - | 10,749 |
316,077 | (251,353) | (88,067) | (23,343) | |
Unutilized tax losses and credits | ||||
Tax loss carryforw ards | 74,616 | - | - | 74,616 |
Social contribution tax loss carryforw ards | 27,336 | - | - | 27,336 |
418,029 | (251,353) | (88,067) | 78,609 | |
Re cognize d | Recognized in | |||
Ope ning | in profit or | other | Clos ing | |
balance as at | loss for the | com pr e he ns ive | balance as at | |
Com pany | 03.31.19 | period | income (loss) | 12.31.19 |
Temporary differences: | ||||
Provision for tax, labor, civil and environmental contingencies | 47,227 | (10,083) | 37,144 | |
Adjustment at fair value of biological assets | (15,389) | (24,355) | (39,744) | |
Other receivables (AVP) | 1,795 | 17,136 | 18,931 | |
Hedge accounting of Libor sw ap, NDF and exchange rate changes | 7,817 | (9,176) | (12,013) | |
Unrealized exchange rate changes | 209,867 | (653) | 209,214 | |
Amortization of tax goodw ill | (245,277) | - | (245,277) | |
Accelerated depreciation | (25,179) | (10,040) | (35,219) | |
Impairment | 65,746 | (266) | 65,480 | |
Mark-to-market of derivatives | (16,095) | (39,883) | (55,978) | |
Impairment of assets held for sales | 18,003 | (18,003) | - | |
Other | 26,074 | (277) | 25,797 | |
74,589 | (95,600) | (31,665) | ||
Unutilized tax losses and credits | ||||
Tax loss carryforw ards | 74,616 | - | 74,616 | |
Social contribution tax loss carryforw ards | 27,336 | - | 27,336 | |
176,541 | (95,600) | 70,287 | ||
19 |
- - - (10,654)
- - - - - - - (10,654)
- - (10,654)
Biosev S.A.
Notes to the Interim Financial Statements
For the Nine-month Period Ended December 31, 2020 (Amounts in thousands of Brazilian reais, unless otherw ise stated)
Re cognize d | ||||
in profit or | Clos ing | |||
loss for the | balance as at | |||
Cons olidate d | 03.31.20 | period | 12.31.20 | |
Temporary differences: | ||||
Provision for tax, labor, civil and environmental contingencies | 100,468 | (1,272) | - | 99,196 |
Adjustment at fair value of biological assets | (71,630) | (245,616) | - | (317,246) |
Other receivables (AVP) | 14,162 | (3,284) | - | 10,878 |
Hedge accounting of Libor sw ap, NDF and exchange rate changes | 159,955 | - | (42,133) | 117,822 |
Unrealized exchange rate changes | 827,139 | (124,331) | - | 702,808 |
Amortization of tax goodw ill | (245,277) | - | - | (245,277) |
Accelerated depreciation | (39,048) | (54,075) | - | (93,123) |
Mark-to-market of derivatives | (10,244) | (19,335) | - | (29,579) |
Impairment of property, plant and equipment | 76,443 | (1,258) | - | 75,185 |
Appreciation of acquired assets | (231,020) | 18,822 | - | (212,198) |
Impairment of fixed assets | 906 | (906) | - | - |
Fair value of financial debts | 1,161 | (1,161) | - | - |
Leases | 35,367 | 16,116 | - | 51,483 |
Other | 60,563 | (27,148) | - | 33,415 |
678,945 | (443,448) | (42,133) | 193,364 | |
Unutilized tax losses and credits | ||||
Tax loss carryforw ards | 115,532 | 2,597 | - | 118,129 |
Social contribution tax loss carryforw ards | 41,611 | 935 | - | 42,546 |
836,088 | (439,916) | (42,133) | 354,039 | |
Re cognize d | ||||
Ope ning | in profit or | Recognizd in other | Clos ing | |
balance as at | loss for the | com pr e he ns ive | balance as at | |
Cons olidate d | 03.31.19 | period | income (loss) | 12.31.19 |
Temporary differences: | ||||
Provision for tax, labor, civil and environmental contingencies | 97,941 | (257) | 97,684 | |
Adjustment at fair value of biological assets | (32,728) | (68,505) | (101,233) | |
Other receivables (AVP) | 1,795 | 17,913 | 19,708 | |
Hedge accounting of Libor sw ap, NDF and exchange rate changes | 165,790 | - | 80,269 | |
Unrealized exchange rate changes | 439,388 | (19,168) | 420,220 | |
Amortization of tax goodw ill | (245,277) | - | (245,277) | |
Accelerated depreciation | (25,179) | (10,040) | (35,219) | |
Mark-to-market of derivatives | (82,228) | 25,395 | (56,833) | |
Impairment of property, plant and equipment | 77,177 | (541) | 76,636 | |
Appreciation of acquired assets | (253,050) | 16,256 | (236,794) | |
Impairment of fixed assets | 18,896 | (17,990) | 906 | |
Fair value of financial debts | 1,161 | - | 1,161 | |
Other | 50,545 | 36,646 | 87,191 | |
214,231 | (20,291) | 108,419 | ||
Unutilized tax losses and credits | ||||
Tax loss carryforw ards | 109,760 | - | 109,760 | |
Social contribution tax loss carryforw ards | 40,819 | - | 40,819 | |
364,810 | (20,291) | 258,998 |
- - (85,521)
- - - (85,521)
- - - - - - - - - (85,521)
As at December 31, 2020, the Company has tax loss carryforwards in the amount of R$3,411,588, in Company, and R$6,585,822 in Consolidated (R$3,115,535 and R$6,369,813 as at March 31, 2020, respectively) for w hich no deferred income tax and social contribution assets have been recognized.
Biosev S.A.
Notes to the Interim Financial Statements
For the Nine-month Period Ended December 31, 2020 (Amounts in thousands of Brazilian reais, unless otherw ise stated)
12. LEASES
12.1 Asset use right in leases
This line item includes the amounts that correspond to the right to use the current agreements; the amount is equivalent to thepresentvalueoftheobligationsassumedwiththecounterparties.Theseagreementsarepayableontherespective maturity dates (betw een 1 and 13 years).
The changes for the period are broken dow n as follow s:
Com pany
AgriculturalEquipm e nt
Land
BuildingsV e hicle spartnershipsTotal
03.31.20
440,009 700,306
Additions/adjustments Derecognition Amortization
12.31.20
549,299
786,610
121,329 20,569 (3,816) (42,279) 95,803
134,947 24,753 - (21,813) 137,887
1,533 - - (767) 766
2,488 3,817 (1,899) (1,551) 2,855
199,926 249,065
- (5,715)
(90,636) (157,046)Com panyEquipm e nt
Land
BuildingsV e hicle sAgricultural partnershipsTotal
03.31.19
143,509 249,375
Initial adoption on April 1, 2019 Additions/adjustments Derecognition Amortization
142,669 55,367 (19,991) (56,716) 121,329
112,768 50,499 - (28,320) 134,947
2,554 - - (1,021)
4,845 - - (2,357)
393,697 656,533
- (19,991)
(97,197) (185,611)
03.31.20
1,533
2,488
440,009
700,306
Cons olidate dEquipm e nt
Land
BuildingsV e hicle sAgricultural partnershipsTotal
03.31.20
Additions/adjustments Derecognition Amortization
254,249 57,309 (7,593)
137,257 27,366 - (23,510) 141,113
1,533 - - (767) 766
5,174 8,028 (3,991) (3,113) 6,098
1,179,166 698,693
1,577,379 791,396
- (11,584)
(90,412) 213,553
(255,545) (373,347)
12.31.20
1,622,314
1,983,844
Cons olidate dEquipm e nt
Land
BuildingsV e hicle sAgricultural partnershipsTotal
03.31.19
(314,849) (477,197)
Initial adoption on April 1, 2019 Additions/adjustments Derecognition Amortization
03.31.20
296,896 118,960 (34,675) (126,932)
254,249
115,195 51,556 - (29,494) 137,257
2,554 - - (1,021)
10,075 - - (4,901)
1,068,666 425,349
1,493,386 595,865
- (34,675)
1,533
5,174
1,179,166
1,577,379
Biosev S.A.
Notes to the Interim Financial Statements
For the Nine-month Period Ended December 31, 2020 (Amounts in thousands of Brazilian reais, unless otherw ise stated)
12.2 Lease liabilities
Lease liabilities refer to future payments stated to present value at the discount rate, subject to possible effects from recoverable taxes (PIS and COFINS).
The incremental interest rate of the lease liability varies betw een 5.10% and 11.25% per year.
The changes for the period are broken dow n as follow s:
Com pany
Cons olidate d
Present value of liability
Clas s ification:
Current Non-current
Total
12.31.20 | 03.31.20 | 12.31.20 | 03.31.20 |
836,278 | 732,114 | 2,135,265 | 1,681,269 |
836,278 | 732,114 | 2,135,265 | 1,681,269 |
207,270 | 215,257 | 561,217 | 498,932 |
629,008 | 516,857 | 1,574,048 | 1,182,337 |
836,278 | 732,114 | 2,135,265 | 1,681,269 |
Com pany
Cons olidate d
13. INVESTMENTS (PROVISION FOR INVESTMENT | ||||
12.31.20 | 12.31.20 | 03.31.20 | ||
Investments in subsidiaries and jointly-controlled subsidiaries | 1,251,459 | 1,237,960 | 152,044 | 157,891 |
Other investments | 2,502 | 2,502 | 2,503 | 2,502 |
Inve s tm e nts | 1,253,961 | 1,240,462 | 154,547 | 160,393 |
Provision for investment loss | (947,760) | (1,251,234) | - | - |
22 |
12.31.20 | 03.31.20 | 12.31.20 | 03.31.20 |
732,114 | 656,533 | 1,681,269 | 1,493,386 |
197,274 | 249,605 | 792,379 | 596,011 |
- | (4,065) | - | (6,065) |
(123,924) | (221,208) | (436,432) | (521,309) |
30,814 | 51,249 | 98,049 | 119,246 |
836,278 | 732,114 | 2,135,265 | 1,681,269 |
Cons olidate d |
Com pany 03.31.20
Opening balance A dditions Derecognition Payments Financial charges
Closing balance
The future payments are broken dow n as follow s:
Com pany
Cons olidate d
12.31.20
03.31.20
12.31.20
03.31.20
207,270
215,257
561,217 498,932
129,873
109,793
338,263 260,574
118,862
86,462
267,565 193,298
Up to 1 year Up to 2 years Up to 3 years Up to 4 years Up to 5 years Above 5 years
165,501
111,148
2,135,265
1,681,269
103,624 836,278
161,243
87,311
72,048 732,114
416,773 365,273
282,806 210,009
268,641 153,183
LOSS)
Biosev S.A.
Notes to the Interim Financial Statements
For the Nine-month Period Ended December 31, 2020 (Amounts in thousands of Brazilian reais, unless otherw ise stated)
a) Interest in subsidiaries and jointly-controlled entities
Cons olidate d | ||||
Bios e v | ||||
Biosev | Bioe ne r gia | |||
Bioenergia S.A. | International S.A. | TEAG | ||
Capital | 2,985,044 | 175 | 14,365 | 44,701 |
Profit (loss) for the period | 391,792 | (10,016) | (17,467) | (849) |
Equity | (946,644) | 315,981 | 30,033 | 39,517 |
Elimination of gains on the sale of property, plant and equipment w ith related parties | (1,111) | - | - | - |
Shareholding interest | 100% | 100% | 100% | 50% |
Value of investments in subsidiaries under equity method | (947,755) | 315,981 | 30,033 | 19,759 |
Goodw ill/realization of concession value, net | 494,079 | - | - | 132,285 |
Elimination of gains on the sale of property, plant and equipment w ith related parties | (5) | - | - | - |
Inve s tm e nts | (453,681) | 315,981 | 30,033 | 152,044 |
Provision for investment loss | (947,760) | - | - | - |
Equity pick up in subsidiaries | 391,787 | (10,016) | (17,467) | (425) |
Com pany
Biosev Com ercializadora
S.A.
b) Changes in investments in subsidiaries, jointly-controlled entities and non-controlled entities
Com pany
Goodw illBios e v ComercializadoraTavares de
S.A.
Melo (*)Ampla (*)
Bios e v | ||||||||
Biosev | Bioe ne r gia | |||||||
Bioenergia S.A. | International S.A. | Othe r | 12.31.20 | 03.31.20 | ||||
Opening balance | (1,251,233) | 326,014 | 6,500 | - | - | 2,502 | (916,217) | (85,938) |
Capital increase | - | - | 41,000 | - | - | - | 41,000 | 4,000 |
Equity pick up in subsidiaries | 391,787 | (10,016) | (17,467) | - | - | - | 364,304 | (1,109,447) |
Other comprehensive income (loss) | (88,314) | (17) | - | - | - | (88,331) | 274,249 | |
Other | - | - | - | - | - | - | - | 920 |
Value of investments in subsidiaries under equity method | (947,760) | 315,981 | 30,033 | - | - | 2,502 | (599,244) | (916,216) |
Goodw ill | 494,079 | - | - | 407,675 | 3,691 | - | 905,445 | 905,446 |
Value of investments | 494,079 | 315,981 | 30,033 | 407,675 | 3,691 | 2,502 | 1,253,961 | 1,240,462 |
Provision for investment loss | (947,760) | - | - | - | - | - | (947,760) | (1,251,233) |
(*) Companies merged in prior years. | ||||||||
TEAG | ||||||||
23 |
Cons olidate dOthe r
12.31.20
03.31.20
Opening balance
157,890
160,393
Equity pick up in subsidiaries
Loss
Realization of concession value, net
Other
Value of investments
878 152,044
(6,724)
2,503 - - - - 2,503
(425)
169,913
(6,724)
(425)
(6,299)
(8,952)
(553)
(6,299)
878
(8,399)
(568)
154,547
160,393
Biosev S.A.
Notes to the Interim Financial Statements
For the Nine-month Period Ended December 31, 2020 (Amounts in thousands of Brazilian reais, unless otherw ise stated)
c) Investments in direct subsidiaries
• Biosev Comercializadora S.A. ("Biosev Comercializadora") - Direct subsidiary
On September 30, 2020, Biosev Comercializadora S.A. entered into the Private Agreement for Future Capital Increase, on an irrevocable and unconditional basis, w ith parent company Biosev S.A., in the amount of R$41,000, w hich w ill be fully convertible into the Company's registered common shares, w ithout par value.
d) Investments in jointly-controlled entities
The balances of the balance sheet and statement of operations of the company are broken dow n as follow s:
TEAG
12.31.20
03.31.20
Balance sheet Assets
Total current assets
39,374 47,820
Long-term receivables
3,534 3,032
Property, plant and equipment and intangible assets
126,339 124,014
Total non-current assets
129,873 127,046
Total assets
169,247
174,866
L iab ilit ie s
Total current liabilities
17,520 18,286
Total non-current liabilities Equity
112,210 117,970
Total equity
39,517 38,610
Total liabilities and equity
169,247
174,866
TEAG
12.31.20
03.31.20
Statement of operations Net revenue
50,204
52,971
Operating expenses
General, administrative and selling expenses
(45,586) (51,652)
Other operating income
(1,465) 4,541
Operating income (loss) before finance income (costs)
3,153 5,860
Finance income (costs), net
(4,473) (7,529)
Loss before taxation
(1,320) (1,669)
Income tax and social contribution Loss for the period
471 (849)
563 (1,106)
Biosev S.A.
Notes to the Interim Financial Statements
For the Nine-month Period Ended December 31, 2020 (Amounts in thousands of Brazilian reais, unless otherw ise stated)
14. PROPERTY, PLANT AND EQUIPMENT
Com pany
12.31.20 | ||||
Accum ulate d | ||||
Cos t | de pr e ciation | |||
Land | 15,095 | - | ||
Buildings | 261,196 | (95,920) | ||
Improvements | 25,623 | (14,129) | ||
Facilities | 358,086 | (217,463) | ||
Furniture and fixtures | 12,397 | (8,594) | ||
IT equipment | 31,287 | (29,257) | ||
Machinery and equipment (*) | 2,326,957 | (1,537,951) | ||
Vehicles | 8,222 | (6,565) | ||
Agricultural machinery and implements (**) | 961,109 | (863,733) | ||
Bearer plant | 1,727,704 | (1,461,734) | ||
5,727,676 | (4,235,346) | |||
Construction in progress (Note 14.1) | 16,826 | - | ||
5,744,502 | (4,235,346) | |||
12.31.20 | ||||
Accum ulate d | ||||
Cos t | de pr e ciation | Net | Cos t | |
Land | 20,702 | - | 20,702 | 21,084 |
Buildings | 479,283 | (197,458) | 281,825 | 475,559 |
Improvements | 128,627 | (62,958) | 65,669 | 128,777 |
Facilities | 560,585 | (338,427) | 222,158 | 545,312 |
Furniture and fixtures | 21,331 | (15,076) | 6,255 | 20,731 |
IT equipment | 62,163 | (55,222) | 6,941 | 60,607 |
Machinery and equipment (*) | 5,753,067 | (4,003,342) | 1,749,725 | 5,595,046 |
Vehicles | 29,558 | (29,413) | 145 | 35,459 |
Agricultural machinery and inputs (**) | 1,747,559 | (1,555,507) | 192,052 | 1,734,333 |
Bearer plant | 3,136,884 | (2,596,187) | 540,697 | 2,966,966 |
11,939,759 | (8,853,590) | 3,086,169 | 11,583,874 | |
Construction in progress (Note 14.1) | 55,996 | - | 55,996 | 72,993 |
11,995,755 | (8,853,590) | 3,142,165 | 11,656,867 | |
(*) Includes deferred manufacturing costs. | ||||
(**) Includes deferred agricultural costs. | ||||
Net
15,095
165,276
11,494
140,623
3,803
2,030
789,006
1,657
97,376
265,970 1,492,330 16,826 1,509,156
03.31.20 | ||
Accum ulate d | ||
de pr e ciation | Net | |
15,095 | - | 15,095 |
259,775 | (92,431) | 167,344 |
25,587 | (13,501) | 12,086 |
351,848 | (208,192) | 143,656 |
12,186 | (8,193) | 3,993 |
30,927 | (28,672) | 2,255 |
2,246,767 | (1,388,282) | 858,485 |
10,615 | (8,567) | 2,048 |
960,728 | (805,016) | 155,712 |
1,627,300 | (1,366,804) | 260,496 |
5,540,828 | (3,919,658) | 1,621,170 |
14,263 | - | 14,263 |
5,555,091 | (3,919,658) | 1,635,433 |
03.31.20 | ||
Accum ulate d | ||
de pr e ciation | Net | |
- | 21,084 | |
(184,730) | 290,829 | |
(60,118) | 68,659 | |
(320,850) | 224,462 | |
(14,443) | 6,288 | |
(53,128) | 7,479 | |
(3,657,614) | 1,937,432 | |
(34,121) | 1,338 | |
(1,426,694) | 307,639 | |
(2,427,778) | 539,188 | |
(8,179,476) | 3,404,398 | |
- | 72,993 | |
(8,179,476) | 3,477,391 | |
25 |
Cos t
Biosev S.A.
Notes to the Interim Financial Statements
For the Nine-month Period Ended December 31, 2020 (Amounts in thousands of Brazilian reais, unless otherw ise stated)
The changes in the net value of property, plant and equipment are as follow s:
Com pany
Cons olidate d
12.31.20 | 03.31.20 | 12.31.20 | 03.31.20 | |
Opening balance | 1,635,433 | 1,697,433 | 3,477,391 | 3,641,525 |
Acquisitions and additions | 225,586 | 378,970 | 435,769 | 793,991 |
Residual value of w rite-offs | (8,832) | (53,726) | (13,686) | (58,913) |
Transfer to assets held for sale | 17,706 | 19,312 | 17,706 | 22,818 |
Reversal of allow ance for impairment losses (*) | 3,377 | 706 | (1,024) | 522 |
Depreciation for the period/year | (364,114) | (407,262) | (773,991) | (922,552) |
1,509,156 | 1,635,433 | 3,142,165 | 3,477,391 | |
(*) See Note 14.3. | ||||
14.1 Construction in progress |
Construction in progress is broken dow n by plant as follow s:
Com pany
Cons olidate d
Plant | 12.31.20 | 03.31.20 | 12.31.20 | 03.31.20 |
Leme | 3,878 | 7,959 | 3,878 | 7,959 |
Passatempo | 5,402 | 2,497 | 5,402 | 2,497 |
Lagoa da Prata | 3,699 | 2,294 | 3,699 | 2,294 |
Rio Brilhante | 3,843 | 1,513 | 3,844 | 1,513 |
Santa Elisa | - | - | 16,679 | 16,295 |
Vale do Rosário | - | - | 11,027 | 18,635 |
MB | - | - | 6,344 | 7,647 |
Continental | - | - | 5,119 | 16,153 |
Corporativo | 4 | - | 4 | - |
16,826 | 14,263 | 55,996 | 72,993 |
The balance of construction in progress refers basically to the adaptation of industrial facilities, increase in sugar production and refurbishment of administrative facilities.
14.2 Fixed assets given in guarantee and commitments for acquisition of fixed assets
As at December 31, 2020, the Company had agreements with suppliers for acquisition of fixed assets, amounting to R$136,067 (R$21,607 as at March 31, 2020), and total fixed assets given in guarantee in the amount of R$1,064,124 (R$809,362 as at March 31, 2020).
14.3 Impairment
As at December 31, 2020, the reversal/impairment totaled R$3,377, in Company, and (R$1,024) in Consolidated (R$706, in Company, and R$522, in Consolidated, as at March 31, 2020), due the sales and/or transfers of fixed assets betw een industrial clusters of the Group.
As at December 31, 2020, the accumulated balance of impairment is R$58,115, in Company, and R$191,985 in Consolidated (R$61,492 and R$190,961 as at March 31, 2020, respectively).
The main impaired assets comprise land, buildings, furniture and fixtures, computers, machinery and equipment, vehicles, and agricultural machinery and implements.
Biosev S.A.
Notes to the Interim Financial Statements
For the Nine-month Period Ended December 31, 2020 (Amounts in thousands of Brazilian reais, unless otherw ise stated)
15.
INTANGIBLE ASSETS
Com pany
Cons olidate d
12.31.20 | 03.31.20 | |||
Goodw ill | ||||
Biosev Bioenergia | - | - | 494,079 | 494,079 |
Usinas Tavares de Melo | - | - | 407,675 | 407,675 |
A mpla | - | - | 3,691 | 3,691 |
- | - | 905,445 | 905,445 | |
Softw are | ||||
Licences | 7,998 | 11,856 | 9,189 | 12,997 |
7,998 | 11,856 | 9,189 | 12,997 | |
Other | - | - | 2,826 | 3,522 |
- | - | 2,826 | 3,522 | |
7,998 | 11,856 | 917,460 | 921,964 | |
Com pany |
03.31.20
12.31.20
03.31.20
The changes in intangible assets are as follow s:
AdditionsSoftw are Licences
11,856 11,856
483 483
Write-off
(264)
(264)Am ortization
(4,218)
(4,218)Reversal impairment
141 7,998
Com pany
03.31.19
Softw are LicencesAdditions
(5,090) 12,865
Goodw ill
Biosev Bioenergia
9,126 9,126
8,829 8,829
Am ortization
12.31.19
(5,090) 12,865
Cons olidate d
12.31.20
141
7,998
03.31.20
AdditionsWrite-offAm ortizationReversal impairment
12.31.20
Usinas Tavares de Melo
A mpla
494,079 407,675
- -- -- -- 494,079 - 407,675
3,691 - - - - 3,691
Softw are
Licences Othe r Other
12,997
3,522 921,964
929
- 929
(374)
- (374)
(4,614)
(696)
(5,310)
251 9,189
- 2,826 251 917,460
Biosev S.A.
Notes to the Interim Financial Statements
For the Nine-month Period Ended December 31, 2020 (Amounts in thousands of Brazilian reais, unless otherw ise stated)
Cons olidate d
03.31.19 | Additions | Am ortization | 12.31.19 | |
Biosev Bioenergia | 494,079 | - | - | 494,079 |
Usinas Tavares de Melo | 407,675 | - | - | 407,675 |
A mpla | 3,691 | - | - | 3,691 |
Softw are | ||||
Licences | 9,726 | 9,836 | (5,893) | 13,669 |
Othe r | ||||
Other | 4,489 | - | (526) | 3,963 |
919,660 | 9,836 | (6,419) | 923,077 |
Goodw ill
16.
BORROWINGS AND FINANCING
De s cr iption
CurrencyWeighted average financial charges
Com panyMaturity (*)
Collaterals
12.31.20
03.31.20
Advance on Foreign Exchange Contract (ACC) (a)US$
Exchange rate change plus average interest rate of 5.37% p.a.
As at 03.31.23
Guarantee and promissory note
1,681,902
1,625,953
Export Prepayment - PPE (a)
US$
Exchange rate change plus Libor plus average interest rate of 4% p.a.
As at 03.25.23
Promissory note, receivables and collateral
687,669 680,727
Constitutional Fund to Finance the the Midw est - FCO
R$
Interest of 10% p.a.
Average interest rate of 9.38% p.a. From 04.17.23
Finame
R$
and TLP + 4.92% p.a.
to 04.15.25
guarantee and promissory 30,374 38,370 note
Export Credit Note and Bill - NCE
R$
CDI plus average interest rate of 2%
As at 12.01.23
Guarantee, conditional sale and receivables Conditional sale,
As at 04.29.22
Guarantee, promissory note and collateral
41,505 51,868
181,108 181,212
Exchange rate change plus Libor
Mortgage, credit rightsOffshore Loan (a)
US$
plus average interest rate of 5.75% As at 10.15.27 p.a.
244,099 285,479
and collateralBank Credit Note - CCB
CDI plus average interest rate of
R$
2%As at 03.30.23
Collection and assignment of receivables
147,986 139,434
3,014,643 3,003,043
(*) Refers to the last maturity date of the agreements.
Current liabilities Non-current liabilities
1,318,124 2,935,559
1,696,519
67,484
Biosev S.A.
Notes to the Interim Financial Statements
For the Nine-month Period Ended December 31, 2020 (Amounts in thousands of Brazilian reais, unless otherw ise stated)
Cons olidate dDe s cr iption
CurrencyWeighted average financial charges
Maturity (*)
Collaterals
12.31.20
03.31.20
Restructured debt (ex-Debentures) - R$
R$
CDI plus 1.72% p.a.
As at 07.10.24
Guarantee, receivables, mortgage and shares
68,994
99,771
Exchange rate change plus Libor
Restructured debt - US$
US$
plus average interest rate of 2.47% As at 07.10.23 p.a.
Guarantee, receivables, mortgage and shares
510,533
741,176
Restructured debt (debenture) - R$ (a)
R$
CDI plus 1.72% p.a.
As at 07.10.24
Guarantee, receivables, mortgage and shares
104,040
140,590
Advance on Foreign Exchange Contract - ACC (a)US$
Exchange rate change plus average interest rate of 5.40% p.a.
As at 03.31.23
Guarantee and promissory note
3,527,147 3,642,512
Exchange rate change plus Libor
From
Export Prepayment - PPE (a)/(b)
US$
plus average interest rate of 5.64% 03.25.2023 toGuarantee, promissory note,receivables and collateral 2,007,966 1,962,581
p.a.
04.30.23
Constitutional Fund to Finance the Midw est - FCO
R$
Interest of 10% p.a.
As at 12.01.23 Guarantee, conditional sale and receivables 41,505 51,868
Average interest rate of 9.55% p.a. From 04.15.21
Finame
R$
Conditional sale, guarantee and promissory note 65,966 76,802
and TLP + 4.92% p.a.
to 04.15.25
Export Credit Note and Bill - NCE
R$
CDI plus average interest rate of 2.% p.a.
As at 04.29.22
Guarantee, promissory note and collateral 181,108 181,212
Exchange rate change plus Libor
Offshore Loan (a)
US$
plus average interest rate of 5.75% As at 10.15.27 p.a.
Mortgage, credit rights and collateral 244,099 285,479
CDI plus average interest rate of
Bank Credit Note - CCB
R$
As at 03.30.23
Collection and assignment of receivables
2% p.a. 163,202 139,434
6,914,560
7,321,425
Current liabilitiesNon-current liabilities
3,058,308 3,856,252
7,225,234 96,191
(*) Refers to the last maturity date of the agreements.
(a) Net of commission costs and deferred expenses, in the amount of R$2,531, in Company, and R$7,517, in Consolidated, as at December 31, 2020 (R$2,755, in Company, and R$8,843, in Consolidated, as at March 31, 2020), monthly recorded in profit or loss through the maturity of such transaction.
(b) Include export prepayments, contracted on January 9, 2015, by subsidiary Biosev Bioenergia International S.A. withthe trade union of foreign financial institutions, in the amount of R$1,148,393 as at December 31, 2020 (R$1,150,301 as at March 31, 2020). These operations are collateralized by a set of assets for settlement. As at December 31, 2020, the foreign currency-denominated deposits comprise, together w ith the agricultural production (sugarcane) of specific units and sugar and ethanol inventories, the ratio of 142.70% of the obligations.
Non-current liabilities mature as follow s (crop year):
Com pany | Cons olidate d | |
12.31.20 | 12.31.20 | |
January 2022 to March 2022 | 100,171 | 309,008 |
April 2022 to March 2023 | 1,399,112 | 3,026,750 |
April 2023 to March 2024 | 51,200 | 361,988 |
April 2024 to March 2025 | 40,128 | 48,620 |
April 2025 to October 2027 | 105,908 | 109,886 |
1,696,519 | 3,856,252 |
The verification of compliance w ith the restrictive covenants occurs annually, at the close of Company's year. As at March 31,2020,theCompanyhasnotachievedsomefinancialcovenants.However,theCompanyobtainedthecreditors'waiver, that is, the Company is not obligated to comply w ith the financial covenants not performed on the balance sheet date and, therefore, the original maturity dates have been maintained.
Biosev S.A.
Notes to the Interim Financial Statements
For the Nine-month Period Ended December 31, 2020 (Amounts in thousands of Brazilian reais, unless otherw ise stated)
16.1 Changes in borrowings and financing
Com pany
Cons olidate d
17.
18.
Related parties (Note 20)
667,634 804,868
12.31.20
03.31.20
12.31.20
03.31.20
Opening balance
3,003,043
2,508,176
7,321,425
5,979,328
A dditions
655,622
1,840,335
1,233,828
4,459,444
Payment of principal
(686,058)
(1,961,531)
(1,705,482)
(4,733,209)
Interest, exchange rate changes and inflation
136,838
825,313
293,591
2,080,661
adjustments and adjustment to fair value of loans, net
Payment of interest
(94,802)
(209,250)
(228,802)
(464,799)
Closing balance
3,014,643
3,003,043
6,914,560
7,321,425
Cons olidate d
Cons olidate d
Com pany
TRADE PAYABLES
In Brazil
Abroad
Third parties
In Brazil Abroad
Current liabilities Non-current liabilities
TAXES PAYABLE
12.31.20
03.31.20
12.31.20
03.31.20
8,975 62,043 71,018
6,068 89,808 95,876
8,181 8,001 5,680 4,494 13,861 12,495
218,256 2,655 220,911 291,929 287,643 4,286
215,843 664,037 662,534 3,118 (10,264) 129,839 218,961 653,773 792,373
314,837 309,104 5,733
663,105 798,903 4,529 5,965
Com pany
03.31.20 | 12.31.20 | 03.31.20 | ||
Payment in installments | - | 125 | 2,026 | 2,137 |
Tax on Manufactured Products (IPI) | - | - | 598 | 1,027 |
State VAT (ICMS) | 1,683 | 6,916 | 1,683 | 8,152 |
Taxes on revenue (PIS and COFINS) | 2,074 | 314 | 7,598 | 4,979 |
Social Security Tax (INSS) | 4,007 | 3,867 | 7,393 | 11,083 |
Income tax (IRPJ) and social contribution (CSLL) | 299 | 3,378 | 31,873 | 40,299 |
Withholding Income Tax (IRPF) | 12,660 | 12,660 | 12,660 | 12,660 |
Other | 11,492 | 12,555 | 11,493 | 13,316 |
32,215 | 39,815 | 75,324 | 93,653 | |
Current liabilities | 13,891 | 21,314 | 57,000 | 75,152 |
Non-current liabilities | 18,324 | 18,501 | 18,324 | 18,501 |
30 |
12.31.20
Biosev S.A.
Notes to the Interim Financial Statements
For the Nine-month Period Ended December 31, 2020 (Amounts in thousands of Brazilian reais, unless otherw ise stated)
19.
PROVISION FOR TAX, LABOR, CIVILAND ENVIRONMENTAL CONTINGENCIES
The Company is a party to various ongoing law suits involving tax, labor, civil and environmental matters arising in the norma l course of business.
Tax
Income tax (IRPJ) and social contribution (CSLL)
Com pany
Re cognition
(reversal) of
Labor Environmental Civil
Criminal
Tax
Income tax (IRPJ) and social contribution (CSLL)
03.31.20 |
79 |
79 |
84,919 |
1,696 |
20,782 |
605 |
108,002 |
108,081 |
inflation | Inflation | |
adjus tm e nts | adjus tm e nts | Additions |
- | - | - |
- | - | - |
(5,701) | 14,693 | (10,616) |
(646) | 1,018 | (263) |
(228) | 1,062 | (301) |
(132) | - | (495) |
(6,707) | 16,773 | (11,675) |
(6,707) | 16,773 | (11,675) |
Com pany | ||
-
Wr itte n-off r e ve r s alsWr itte n-off paym e nts
12.31.20
-
7,758 680 2,944 22 11,404 11,404
03.31.19
Re cognition (reversal) of inflation adjus tm e nts
Additions
- | 79 | |
- | 79 | |
(10,964) | 80,089 | |
- | 2,485 | |
- | 24,259 | |
- | - | |
(10,964) | 106,833 | |
(10,964) | 106,912 | |
Wr itte n-off | Wr itte n-off | |
reversals | paym e nts | 12.31.19 |
76 76
2 2
- -- -- -
78
78
Labor Environmental Civil
128,197 1,468 8,338 - 138,003 138,079
(6,165)
32,771 3 9,510 202 42,486 42,486
(66,896)
257 5,021 99 (788) (786)
(3,826)
84,081
(73) (560)
- - -
1,655
22,309
Criminal
- (67,529) (67,529)
108,346 | ||
108,424 | ||
12.31.20 | ||
- | - | 17,856 |
- | - | 3,406 |
- | - | 2,853 |
- | - | 16 |
- | - | 24,131 |
(16,322) | (51,102) | 219,771 |
(406) | - | 14,767 |
(1,691) | - | 32,258 |
(495) | - | - |
(18,914) | (51,102) | 266,796 |
(18,914) | (51,102) | 290,927 |
31 |
301
(3,826) (3,826)
Labor Environmental Civil
227,868 11,354 30,782 605 270,609 294,668
21,276 2,751 4,023 22 28,072 28,144
(18,322) 56,373
(997) 2,065
(2,346) 1,490
Criminal
(21,797) (21,797)
(132)
- 59,928 59,928
Biosev S.A.
Notes to the Interim Financial Statements
For the Nine-month Period Ended December 31, 2020 (Amounts in thousands of Brazilian reais, unless otherw ise stated)
Cons olidate d
03.31.19 | adjus tm e nts | 12.31.19 | ||||
Tax | ||||||
IPI levied on sugar sales | ||||||
17,584 | 162 | - | - | - | 17,746 | |
PIS and COFINS | 3,406 | - | - | - | - | 3,406 |
Income tax (IRPJ) and social contribution (CSLL) | 2,850 | 2 | - | - | - | 2,852 |
Other | 16 | - | - | - | - | 16 |
23,856 | 164 | - | - | - | 24,020 | |
Labor | 236,368 | (1,706) | 90,867 | (91,076) | (15,517) | 218,936 |
Environmental | 7,611 | 2,584 | 1,367 | (474) | - | 11,088 |
Civil | 19,402 | 3,850 | 10,426 | (1,542) | - | 32,136 |
Criminal | - | 99 | 202 | - | - | 301 |
263,381 | 4,827 | 102,862 | (93,092) | (15,517) | 262,461 | |
287,237 | 4,991 | 102,862 | (93,092) | (15,517) | 286,481 |
Contingencies - court or out-of-court claims classified as possible losses and not accrued
Tax
The tax claims (court and out-of-court) as at December 31, 2020, w ith an acknow ledged possible likelihood of loss and not accrued are show n in the table below :
Com pany
Cons olidate d
Tax
12.31.20 | 03.31.20 | 12.31.20 | 03.31.20 |
674,573 | 725,832 | 1,579,820 | 1,652,707 |
674,573 | 725,832 | 1,579,820 | 1,652,707 |
Among the contingencies for w hich a provision has not been recognized and that have been assessed as possible loss is the collection of ICMS due to an alleged difference identified in inventories. Additionally, there is a discussion also involving ICMS on the reasonableness in levying ICMS on export of semi-finished products.
Civil, environmental and labor
The civil, environmental and labor claims (court and out-of-court) as at December 31, 2020, w ith an acknow ledged possible likelihood of loss and not accrued are show n in the table below :
Com pany
Cons olidate d
12.31.20 | 03.31.20 | 12.31.20 | 03.31.20 | |
Civil | 156,396 | 101,979 | 205,611 | 147,405 |
Environmental | 34,716 | 12,278 | 76,545 | 74,433 |
Labor | 73,270 | 76,297 | 127,033 | 126,742 |
264,382 | 190,554 | 409,189 | 348,580 |
AsatDecember31,2020,theGroupwasapartytolabor,environmentalandcivillawsuitswhoselikelihoodoflossis considered possible based on the opinion of Group's legal counsel.
Labor claims are substantially related to (i) working hours; (ii) time in transit; (iii) additional premiums; (iv) refund of deductions, such as trade union fees; (v) contractual exclusivity; (vi) jointly-liability w ith service providers; (vii) occupational accidents and/or hazards/diseases; (viii) organizational climate; (ix) validity of the collective bargaining agreement, and (x) compensation costs in relation to the items mentioned above.
Civil law suits basically refer to discussions involving contractual issues and occupational and/or traffic accidents, collection, possession issues and general indemnities.
Biosev S.A.
Notes to the Interim Financial Statements
For the Nine-month Period Ended December 31, 2020 (Amounts in thousands of Brazilian reais, unless otherw ise stated)
Environmental law suits are substantially related to: (i) burn of sugarcane straw ; and (ii) alleged non-authorized intervention or damages in an area considered by environmental authorities as a permanent preservation area.
20. RELATED PARTIES
The information on related-party transactions has not significantly changed compared to the information disclosed in the financial statements as at March 31, 2020.
The related-party transactions described in the tables below refer basically to: (i) sales in the domestic and international markets at the price agreed betw een the parties, based on the market quotation; (ii) loan transactions; (iii) apportionment of costs relating to the shared facilities; (iv) provision of brokerage services involving derivative transactions; (v) commodities export performance operations; and (vi) lifting and sugar storage services.
The tables below show the balances and transactions as at December 31, 2020 betw een the Company and its subsidiaries, w hich are consolidated in its balance sheet:
Com pany Assets
Trade
Subs idiar ie s
receivables
Loan
Total
Biosev Bioenergia International S.A. Biosev Bioenergia S.A.
Biosev Comercializadora S.A.
12.31.20
12,602
103,961
82,896 3,806 4,657 91,359
- 82,896
3,487 7,293
9,115 13,772
Subs idiar ie s
Biosev Bioenergia International S.A. Biosev Bioenergia S.A.
Biosev Comercializadora S.A.
03.31.20
26,736
166,723
132,489 4,164 3,334 139,987
- 132,489
26,736 30,900
- 3,334
Com pany L iab ilit ie s
Trade payablesSubs idiar ie s
(*)Advances from customers (**)Loan
Total
Biosev Bioenergia International S.A. Biosev Bioenergia S.A.
Biosev Comercializadora S.A.
Sociedade Operadora Portuária de São Paulo S.A. 12.31.20
68,244 3,051 3,154 - 74,449
759,044 - - - 759,044
- 827,288
- 3,051
- 3,154
14,315 14,315
14,315 847,808
Subs idiar ie s
Biosev Bioenergia International S.A. Biosev Bioenergia S.A.
Sociedade Operadora Portuária de São Paulo S.A. 03.31.20
95,932 4,134 - 100,066
814,736 - - 814,736
- 910,668
- 4,134
14,108 14,108
14,108 928,910
(*) As at December 31, 2020, the amount of R$3,061 (R$3,062 as at March 31, 2020) w as recorded in current liabilities, in line item "Other payables".
(**) As at December 31, 2020, the amounts of R$258,891 (R$12,232 as at March 31, 2020) and R$500,153 (R$802,505 as at March 31, 2020) w ere recorded in current liabilities and non-current liabilities, respectively.
Biosev S.A.
Notes to the Interim Financial Statements
For the Nine-month Period Ended December 31, 2020 (Amounts in thousands of Brazilian reais, unless otherw ise stated)
Com pany Profit (loss)
Expenses | ||||||
Total | ||||||
Subs idiar ie s | Sale s | Total | Pur chas e s | Inte r e s t | expenses | |
Biosev Bioenergia International S.A. | 640,294 | - | 640,294 | (511) | (46,038) | (46,549) |
Biosev Bioenergia S.A. | 44,424 | 5 | 44,429 | (1,894) | - | (1,894) |
Biosev Comercializadora S.A. | 21,243 | 24 | 21,267 | (8,817) | - | (8,817) |
Sociedade Operadora Portuária de São Paulo S.A. | - | - | - | - | (385) | (385) |
12.31.20 | 705,961 | 29 | 705,990 | (11,222) | (46,423) | (57,645) |
Subs idiar ie s | ||||||
Biosev Bioenergia International S.A. | 145,642 | - | 145,642 | (325) | (50,151) | (50,476) |
Biosev Bioenergia S.A. | 13,447 | 2,243 | 15,690 | (732) | - | (732) |
Biosev Comercializadora S.A. | 31,879 | 275 | 32,154 | (907) | - | (907) |
Sociedade Operadora Portuária de São Paulo S.A. | - | - | - | - | (556) | (556) |
12.31.19 | 190,968 | 2,518 | 193,486 | (1,964) | (50,707) | (52,671) |
Incom e
Inte r e s t
The tables below show the balances and transactions as at December 31, 2020 betw een the Company and other related parties:
Com pany Assets
Advances to s upplie r sTotal
Companies under common control Louis Dreyfus Company Suisse S.A. Louis Dreyfus Company Brasil S.A. Term Commodities Inc.
12.31.20
Companies under common control Louis Dreyfus Company Suisse S.A. Louis Dreyfus Company Brasil S.A. Term Commodities Inc.
03.31.20
Companies under common control
Trade | |||
Derivatives (*) | receivables | ||
- | 956 | - | 956 |
- | - | 11,615 | 11,615 |
22,819 | - | - | 22,819 |
22,819 | 956 | 11,615 | 35,390 |
- | 1,014 | - | 1,014 |
- | - | 885,170 | 885,170 |
19,112 | - | - | 19,112 |
19,112 | 1,014 | 885,170 | 905,296 |
Cons olidate d
AssetsDerivatives (*)
Louis Dreyfus Company Brasil S.A.
LDC Ethanol Interior Merchandising Louis Dreyfus Company Suisse S.A. Term Commodities Inc.
12.31.20
Companies under common control Louis Dreyfus Company Brasil S.A. LDC Ethanol Interior Merchandising
- - - 22,819 22,819
19,112 261
Louis Dreyfus Company Suisse S.A. - 2,153
Term Commodities Inc. 03.31.20
- -
19,112 2,505
Trade | Advances to | |
receivables | s upplie r s | Total |
11,615 | 11,615 | |
- | 90 | |
- | 4,360 | |
- | 22,982 | |
11,615 | 39,047 | |
2,506,685 | 2,506,685 | |
- | 91 | |
- | 2,153 | |
- | 19,373 | |
2,506,685 | 2,528,302 |
- 90 4,360 163 4,613
- 91
(*) As at December 31, 2020, the amount of R$22,819 (R$19,112 as at March 31, 2020) w as recorded in line item "Short- term investments", relating to margin deposits in derivative transactions.
Biosev S.A.
Notes to the Interim Financial Statements
For the Nine-month Period Ended December 31, 2020 (Amounts in thousands of Brazilian reais, unless otherw ise stated)
Companies under common control Louis Dreyfus Company Brasil S.A. Term Commodities Inc.
- 1,160 - 1,160
Louis Dreyfus Company Suisse S.A.
1,239 - - 1,239
- 1,239
- 1,160
11,528 11,528
11,528 13,927
Jointly-controlled entity
TEAG - Terminal Exp. Açúcar Guarujá Ltda.
12.31.20
- - 1,160
1,531 1,531 2,770
- 1,531
- 1,531
11,528 15,458
Companies under common control Louis Dreyfus Company Brasil S.A. Louis Dreyfus Company Suisse S.A. Term Commodities Inc.
- - 6,585 6,585
185 - - 185
- 185
878,580 878,580
- 6,585
878,580 885,350
Jointly-controlled entity
TEAG - Terminal Exp. Açúcar Guarujá Ltda.
03.31.20
- - 6,585
1,749 1,749 1,934
- 1,749
- 1,749
878,580 887,099
Cons olidate d
L iab ilit ie sDe r ivat ive sTrade payable s
Advances from cus tom e r s
Total
- 1,363
1,160 - - 1,160
Companies under common control Louis Dreyfus Company Brasil S.A. Louis Dreyfus Company Suisse S.A. Term Commodities Inc.
LDC Trading and Services Co.S.A. Term Commodities Inc.
- -1,363 5,595
11,528 17,123
- - 1,160
- 85 7,043
- - 11,528
- 85 19,731
Jointly-controlled entity
TEAG - Terminal Exp. Açúcar Guarujá Ltda.
12.31.20
- - 1,160
6,818 6,818 13,861
- - 11,528
6,818 6,818 26,549
Companies under common control Louis Dreyfus Company Brasil S.A. Louis Dreyfus Company Suisse S.A. LDC Trading and Services Co. S.A. Term Commodities Inc.
- 289 - 6,585 6,874
309 4,251 243 - 4,803
- 2,486,605 - - 2,486,605
309
2,491,145
243
6,585
2,498,282
Jointly-controlled entity
TEAG - Terminal Exp. Açúcar Guarujá Ltda.
03.31.20
- - 6,874
7,692 7,692 12,495
- - 2,486,605
7,692 7,692 2,505,974
Biosev S.A.
Notes to the Interim Financial Statements
For the Nine-month Period Ended December 31, 2020 (Amounts in thousands of Brazilian reais, unless otherw ise stated)
- 1,350,168
(185) - (185)Companies under common control Louis Dreyfus Company Brasil S.A. Louis Dreyfus Company Suisse S.A.
Macrofértil Indústria e Comércio de Fertilizantes Ltda. Term Commodities Inc.
Jointly-controlled entity
Teag-Terminal Exp. Açúcar Guarujá Ltda.
- 1,350,168 - - 1,350,168
-
-
(1,145,910)
- (1,145,910)
- - -
- - 1,350,168
(105) - (105)
(1,161,761)
(15,561)
- -(15,561) (1,161,761)
- - 1,350,168
- -- -
(4,875)
- (4,875)
(4,875)
- (4,875)
12.31.20
-1,350,168
(1,166,636)
- (1,166,636)
Companies under common control
Louis Dreyfus Company Brasil S.A. Louis Dreyfus Company Suisse S.A. Term Commodities Inc.
3,009 1,025,424 - 1,028,433
7,769 - - 7,769
10,778 1,025,424 - 1,036,202
(1,003,279)
- (1,003,279)
-
(7,103) (7,103)
(7,023)
- (7,023)
(1,010,302)
(7,103)
(1,017,405)
-
(1,914)
- (1,914)
Jointly-controlled entity Teag-Terminal Exp. Açúcar Guarujá Ltda.
12.31.19
(1,012,216)
(7,103)
(1,019,319)
- - 1,028,433
- - 7,769
- 1,036,202
(1,914)
- (1,914)
Companies under common control LDC Trading and Services Co.S.A. Louis Dreyfus Company Brasil S.A. Louis Dreyfus Company Suisse S.A.
Louis Dreyfus Commodities Agroindustrial S.A. Macrofértil Indústria e Comércio de Fertilizantes Ltda. Term Commodities Inc.
Jointly-controlled entity Teag-Terminal Exp. Açúcar Guarujá Ltda.
- 731 4,761,728 - - - 4,762,459
- - 23,980 - -
- 731 4,785,708 - -
(864)
(2)
(866)
(2,812,831)
- - - -
(2,812,831)
(386,585)
(386,585)
-
-
(185)
(185)
15 23,995
15 4,786,454
(15,939)
-
(15,939)
(3,216,404)
(2)
(3,216,406)
- - 4,762,459
-
-
(21,452)
- (21,452)
- 23,995
- 4,786,454
(21,452) (3,237,856)
- (21,452)
12.31.20
(2)
(3,237,858)Companies under common control
Louis Dreyfus Company Ethanol Merchandising LLC LDC Trading and Services Co.S.A.
- 3,405 1,859,470 - - - 1,862,875
9 46,903
9 50,308
(564)
-
(564)
(1,177,190)
- (1,177,190)
Louis Dreyfus Company Brasil S.A. Louis Dreyfus Company Suisse S.A.
Macrofértil Indústria e Comércio de Fertilizantes Ltda. Term Commodities Inc.
Jointly-controlled entity Teag-Terminal Exp. Açúcar Guarujá Ltda.
- 1,859,470
(31,085)
(46,382)
(77,467)
3 - 1 46,916
3
-
-
-
(674)
- -
(674)
1 (7,414)
(7,414)
1,909,791
(1,216,927)
(46,382)
(1,263,309)
- - 1,862,875
8 8 46,924
8 8 1,909,799
(17,235)
- (17,235)
(17,235) (1,234,162)
- (17,235)
12.31.19
(46,382)
(1,280,544)
Biosev S.A.
Notes to the Interim Financial Statements
For the Nine-month Period Ended December 31, 2020 (Amounts in thousands of Brazilian reais, unless otherw ise stated)
a) Compensation of key management personnel
The compensation of officers and other key management personnel for the period is as follow s:
Company and Consolidated
12.31.20 | 12.31.19 | |||
Short-termbenefits | 1,003 | 1,902 | 8,556 | 9,464 |
Long-term benef its | - | - | 2,302 | 1,458 |
1,003 | 1,902 | 10,858 | 10,922 |
The short-term benefits of key management personnel comprise salaries, social security contributions, pension fund contributions, social charges, profit sharing and short-term performance bonus. Long-term benefits include performance bonus and deferred benefits that expired in each financial statements.
Biosev S.A.
Notes to the Interim Financial Statements
For the Nine-month Period Ended December 31, 2020 (Amounts in thousands of Brazilian reais, unless otherw ise stated)
21.
NET REVENUE AND COST OF SALES AND SERVICES
Com pany
Cons olidate d
12.31.20
12.31.19
12.31.20
12.31.19
12.31.20
12.31.19
12.31.20
12.31.19
Three-month period | Nine-month period | Three-month period | Nine-month period |
ended | ended | ended | ended |
Gross revenue Domestic market
Sugar
520,988 1,139,980
874,305 1,992,677
Ethanol Energy Other
65,535 222,937 29,671 14,378 332,521
12,475 293,265 31,643 4,513 341,896
188,126 68,344
146,290 17,401 872,805
151,751 10,154 1,370,229
86,311 346,681 221,735 25,103 679,830
30,943 605,429 79,674 12,452 728,498
241,640 131,211
510,459 308,804
51,484 39,402
1,677,888 2,472,094
Foreign market
Sugar
252,805 99,166
32,184
-
1,083,794 244,611
Ethanol Other (a)
287,819 259,441
823,366 81,570 1,408,931
228,378 1,032,043
1,128 1,037,869
529,371 707,183
426,477 11,200 336,818
2,860,306 1,093,006
3,104,033 1,209,025
572,808
358,607
2,313,867
1,267,375
2,268,597
774,495
7,048,133 2,546,642
905,329
700,503
3,186,672
2,637,604
2,948,427
1,502,993
8,726,021 5,018,736
(28,402) (42,648)
(74,512)
(156,928)
(76,823) (112,452)
(189,140) (355,109)Taxes (b) Sales rebates
Net revenue
1,389,546
8,522,891
4,660,369
(2,041) 874,886
(467) 657,388
(3,563) 3,108,597
(1,792) 2,478,884
(2,942) 2,868,662
(995) (13,990) (3,258)
Cost of sales and services (c) Domestic market
Sugar
(29,311) (201,774)
(97,864)
Ethanol Energy
(58,660) (149,101) (11,364)
Other
(847)
(14,380) (187,073) (11,492) (7,622)
(161,254) (391,124) (32,984) (7,958)
(62,041) (788,854) (40,948) (9,224)
(75,626) (233,459) (189,184)
(405,774) (646,134) (1,373,244)
(7,504)
(52,206) (14,683)
(334,853) (161,439)
(41,197) (33,200)
(219,972)
(220,567)
(593,320)
(901,067)
(505,773)
(501,974) (1,223,958) (1,665,747)Foreign market
Sugar (d)
(153,388) (111,414)
(208,787) (787,466)
Ethanol (d)
(19,237)
-(545,625) (53,212)
(3,576) (420,450)
Other (a)
(297,554) (258,737)
(1,440,306) (1,042,517) (717,530)
(470,179)
(370,151)
(2,039,143) (1,254,880) (1,925,446)
(421,289) | (2,218,420) | (1,091,418) |
(6,976) | (824,648) | (269,363) |
(339,067) | (3,125,369) | (1,216,583) |
(767,332) (6,168,437) (2,577,364)
Gains on changes in fair value less estimated costs to sell biological assets
Sugar
33,905
912
Ethanol
26,915 1,356
60,820 (629,331)
2,268 (588,450)
379,208 | 29,909 | 105,083 | 26,006 | 580,466 | 79,487 |
214,839 | 122,205 | 87,816 | 25,937 | 346,977 | 167,818 |
594,047 | 152,114 | 192,899 | 51,943 | 927,443 | 247,305 |
(2,038,416) | (2,003,833) | (2,238,320) | (1,217,363) | (6,464,952) | (3,995,806) |
(a) Amounts relating to the export of commodities.
(b)Includegovernmentgrants,whichreducedthetaxablebaseonsalesbyR$60,504,inCompany,intheperiodended December 31, 2020 (R$73,699 as at December 31, 2019).
(c) Include PIS and COFINS credits in the amount of R$10,226, in Company, and R$18,404, in Consolidated, in the period ended December 31, 2020 (R$12,552 and R$22,765, as at December 31, 2019, respectively), as prescribed by article 3, of Law 10637/02, whichaddresses the non-cumulativeness of PIS/PASEP; and article 3, of Law 10833/03, whichaddresses the non-cumulativeness of COFINS.
(d) Include REINTEGRA credits, in the amount of R$905, in Company, and R$3,414, in Consolidated, in the period ended December 31, 2020 (R$2,516 and R$3,535, as at December 31, 2019, respectively), as set forth in article 21, of Law 13043, of November 13, 2014, w hich addresses the REINTEGRA reintroducing.
Biosev S.A.
Notes to the Interim Financial Statements
For the Nine-month Period Ended December 31, 2020 (Amounts in thousands of Brazilian reais, unless otherw ise stated)
22.
EXPENSES BY NATURE
The information on the nature of cost of sales and services and general, administrative and selling expenses is as follow s:
Com pany
Cons olidate d
Three-month period | Nine-month period | Three-month period | Nine-month period |
ended | ended | ended | ended |
12.31.20 | 12.31.19 | 12.31.20 | 12.31.19 | 12.31.20 | 12.31.19 | 12.31.20 | 12.31.19 | |
Cost of sales and services | ||||||||
Personnel (*) | (53,070) | (48,250) | (171,320) | (169,105) | (120,156) | (122,123) | (400,104) | (357,314) |
Depreciation and amortization (**) | (269,792) | (201,726) | (806,410) | (710,420) | (559,540) | (422,078) | (1,637,969) | (1,401,291) |
Raw materials and inputs, net of taxes: | ||||||||
Raw materials | (58,171) | (62,681) | (170,827) | (177,109) | (346,079) | (222,739) | (999,000) | (765,595) |
Inputs and services | (1,571) | (6,023) | (24,037) | (17,263) | (19,128) | (22,584) | (91,467) | (81,314) |
Products for resale | (307,547) | (272,038) | (1,459,869) | (1,082,050) | (1,386,316) | (479,782) | (4,263,855) | (1,637,597) |
(367,289) | (340,742) | (1,654,733) | (1,276,422) | (1,751,523) | (725,105) | (5,354,322) | (2,484,506) | |
Gains on changes in fair value less estimated costs to sell biological assets | 60,820 | 2,268 | 594,047 | 152,114 | 192,899 | 51,943 | 927,443 | 247,305 |
(629,331) | (588,450) | (2,038,416) | (2,003,833) | (2,238,320) | (1,217,363) | (6,464,952) | (3,995,806) | |
General, administrative and selling expenses | ||||||||
Personnel (*) | (11,942) | (15,304) | (32,221) | (57,801) | (29,520) | (30,245) | (93,401) | (106,337) |
Depreciation | (2,496) | (3,110) | (7,904) | (8,887) | (5,429) | (5,935) | (16,152) | (17,758) |
Freight | (21,084) | (9,175) | (71,261) | (28,080) | (77,888) | (30,858) | (221,419) | (115,217) |
Services | (12,884) | (28,386) | (34,983) | (54,845) | (29,885) | (41,381) | (84,175) | (88,825) |
Shipping expenses | (2,496) | (363) | (7,178) | (2,775) | (23,191) | (8,771) | (67,492) | (29,944) |
Other | (5,379) | (7,981) | (11,783) | (18,945) | (9,492) | (10,838) | (22,985) | (30,782) |
(56,281) | (64,319) | (165,330) | (171,333) | (175,405) | (128,028) | (505,624) | (388,863) |
(*) As at December 31, 2020, the personnel expenses, in Company and Consolidated, comprise R$203,541 and R$493,505, respectively (R$226,906 and R$463,651 as at December 31, 2019), and R$5,336 and R$11,971 (R$6,163 and R$12,700 as at December 31, 2019) relating to INSS contribution, respectively.
(**) Includes biological asset and agricultural produce.
Biosev S.A.
Notes to the Interim Financial Statements
For the Nine-month Period Ended December 31, 2020 (Amounts in thousands of Brazilian reais, unless otherw ise stated)
23. FINANCE INCOME (EXPENSES)
Com pany
Cons olidate d
Three-month period
Nine-month period
Three-month period
Nine-month period
ended
ended
ended
ended
24. OTHER OPERATING INCOME (EXPENSES)
Finance income | 12.31.20 | 12.31.19 | 12.31.20 | 12.31.19 | 12.31.20 | 12.31.19 | 12.31.20 | 12.31.19 |
Discounts obtained | 320 | 22 | 1,005 | 373 | 603 | 50 | 1,649 | 987 |
Revenue from fixed income short-term investments | 286 | 570 | 1,252 | 4,157 | 826 | 1,700 | 3,238 | 9,635 |
Interest | 4,356 | 6,631 | 10,739 | 15,054 | 945 | 7,708 | 9,979 | 17,557 |
Other | - | 53 | 1,713 | 973 | 242 | 844 | 3,315 | 3,821 |
4,962 | 7,276 | 14,709 | 20,557 | 2,616 | 10,302 | 18,181 | 32,000 | |
Finance costs | ||||||||
Interest | (72,624) | (67,073) | (229,958) | (278,465) | (138,058) | (140,674) | (442,538) | (506,458) |
Discounts granted | - | 1 | (1) | (36) | - | 1 | (8) | (36) |
Tax on Financial Transactions (IOF) | (410) | (468) | (2,543) | (1,235) | (1,528) | (1,119) | (7,180) | (4,714) |
Tax on Financial Transactions (IOF) - loan | - | - | - | (64) | (3) | (479) | (176) | (2,731) |
Other | (446) | (485) | (1,558) | (730) | (1,072) | (436) | (3,560) | (3,822) |
Taxes on revenue (PIS and COFINS) on finance income | (601) | (293) | (986) | (798) | (700) | (472) | (1,410) | (1,442) |
(74,081) | (68,318) | (235,046) | (281,328) | (141,361) | (143,179) | (454,872) | (519,203) | |
De r ivat ive s | ||||||||
Commodities derivatives - Commercial transactions | 35,068 | 52,544 | (315,865) | 75,302 | (50,963) | 15,491 | (52,742) | 8,292 |
Commodities derivatives - Financial transactions | (77,216) | (13,730) | 22,511 | (54,682) | (77,216) | (13,730) | 22,511 | (54,682) |
Interest rate derivatives - Libor sw ap | - | - | - | - | (2,315) | (358) | (7,162) | (1,030) |
(42,148) | 38,814 | (293,354) | 20,620 | (130,494) | 1,403 | (37,393) | (47,420) | |
Exchange rate changes | ||||||||
Foreign exchange assets | 404,257 | 267,940 | 580,466 | 488,556 | 1,384,550 | 653,572 | 2,951,186 | 1,322,034 |
Foreign exchange liabilities | (114,986) | (190,124) | (570,267) | (594,306) | (824,890) | (473,251) | (2,984,885) | (1,528,160) |
289,271 | 77,816 | 10,199 | (105,750) | 559,660 | 180,321 | (33,699) | (206,126) | |
Finance income (costs) | 178,004 | 55,588 | (503,492) | (345,901) | 290,421 | 48,847 | (507,783) | (740,749) |
Com pany |
Cons olidate d
Three-month period | Nine-month period | Three-month period | Nine-month period |
ended | ended | ended | ended |
12.31.20 | 12.31.19 | 12.31.20 | 12.31.19 | 12.31.20 | 12.31.19 | 12.31.20 | 12.31.19 | |
Recognition of provision for tax, labor, civil and environmental contingencies | 4,136 | 31,205 | 5,866 | 28,869 | 16,985 | 25,775 | 10,088 | 5,747 |
Contratual fines and indemnities | (61,046) | (6,612) | (72,853) | (25,825) | (115,875) | (19,936) | (152,153) | (66,587) |
Tax expenses | (844) | (3,673) | (3,099) | (6,696) | 588 | (5,885) | (1,196) | (11,636) |
Reversal of impairment of fixed assets and Intangible assets | 505 | - | 3,518 | 555 | (4,951) | - | (773) | 1,976 |
Gains (losses) on sale of property, plant and equipment | (2,309) | 2 | (7,403) | 407 | (1,384) | 2 | (5,025) | 6,436 |
Investments sold | - | - | - | (3,767) | - | - | - | (3,767) |
Impairment of assets held for sale | - | 103 | 119 | 53,374 | - | 103 | 119 | 53,374 |
Reversal (recognition) of estimated losses on doubtful accounts | 6 | (488) | 30 | (747) | 55 | (545) | 466 | (1,002) |
Law suit - Instituito do Acucar e do Alcool - IAA | - | - | - | (1,438) | - | - | - | 31,660 |
Provision for other losses | (22) | (42) | (39) | (168) | (10,283) | 1,890 | (13,937) | (59,702) |
Untimely PIS and COFINS credits | - | - | - | 18,110 | - | - | - | 65,101 |
Other operating expenses, net | 5,642 | 7,112 | 7,009 | (805) | 10,094 | 7,486 | 12,999 | 2,839 |
Total other operating income (expenses), net | (53,932) | 27,607 | (66,852) | 61,869 | (104,771) | 8,890 | (149,412) | 24,439 |
Total other operating income | 7,406 | 7,098 | 19,210 | 88,657 | 19,292 | 14,621 | 36,463 | 187,254 |
Total other operating expenses | (61,338) | 20,509 | (86,062) | (26,788) | (124,063) | (5,731) | (185,875) | (162,815) |
40 |
Biosev S.A.
Notes to the Interim Financial Statements
For the Nine-month Period Ended December 31, 2020 (Amounts in thousands of Brazilian reais, unless otherw ise stated)
25.
LOSS PER SHARE
ThebasicanddilutedlosspersharewascalculatedbasedonthelossattributabletotheBiosev'sownersdividedbythe w eighted average number of outstanding common shares in the period.
Com pany
Cons olidate dNine-month period endedNine-month period ended
12.31.20
12.31.19
12.31.20
12.31.19
Profit (loss) for the period attributable to the Company's ow ners Weighted average number of shares used to calculate basic and diluted earnings per share
Total basic and diluted earnings (loss) per share
453,998 509,508,430 0.89105
(470,117)
433,678,306
(1.08402)
453,998 509,508,430 0.89105
(470,117)
433,678,306
(1.08402)
26. RISK MANAGEMENT AND FINANCIAL INSTRUMENTS
I - Risk management
The Company is exposed to certain risks arising from its operations, such as: market, credit, liquidity and capital risks.
In order to manage these risks, the Company timely implements the proper committee to discuss the following issues: i) monitoring and approval of the hedge percentages through financial instruments and respective sugar, ethanol and power price levels; ii) monitoring of the exposure and approval of the credit limit; iii) monitoring of the liquidity and definition of the strategic actions to meet the cash needs in the short, medium and long terms; and iii) monitoring of the claims in the
Company's operations and insurance coverage.
On a daily basis, the exposures are mapped and reported to the Company's management so that the n ecessary decisions are undertaken.
The definition of percentages and the contracting of hedges through derivative instruments guided by the Financial and Risk Management Policy approved and review ed by the Board of Directors on January 13, 2020. Additionally, the Company does not carry out transactions w ith any type of leverage, as w ell as does not have transactions w ith exotic derivatives.
The risk management policies, practices and instruments are oversight by the Executive Committee and the Strategic
Committee (the body that supports the Company's Board of Directors).
26.1 Market risk
The Company is mainly exposed to risks related to foreign exchange, agricultural commodity price fluctuations, pow er price and interest rates. In order to hedge against these market risks, the Company contracts the follow ing derivative instruments:
Foreign exchange | Price | Interest |
Futures and options-B3 (DDI/DI1/DOL); Forwards - OTC |
| Interest swap |
Biosev S.A.
Notes to the Interim Financial Statements
For the Nine-month Period Ended December 31, 2020 (Amounts in thousands of Brazilian reais, unless otherw ise stated)
As at December 31, 2020, the assets and liabilities relating to the derivative transactions are broken dow n as follow s:
Com pany
Cons olidate d
12.31.20 | 03.31.20 | 12.31.20 | 03.31.20 | |
Exchange risk management (Note 26.1.1) | (26,474) | (343,960) | (26,473) | (343,959) |
Interest rate risk management (Note 26.1.2) | - | - | (25,130) | (27,963) |
Agricultural commodity risk management (Note 26.1.3) | (1,478) | (5,441) | (84,892) | 50,155 |
(27,951) | (349,401) | (136,495) | (321,767) | |
Current assets | 92,157 | 225,787 | 105,423 | 225,787 |
Non-current assets | - | - | - | 55,885 |
Current liabilities | (120,108) | (575,188) | (231,324) | (586,843) |
Non-current liabilities | - | - | (10,594) | (16,596) |
26.1.1
Foreign exchange risk management
Because the Company's functional currency is the Brazilian real (R$), the foreign currency-denominated operations are exposed to the foreign exchange risk. In order to reduce the changes in profit or loss and balance arising from net revenue flows, costs and debts denominated in US dollars, the Company held the following outstanding derivative positions as at December 31, 2020:
Company and Consolidated
Notional value
Average exchange rate
Foreign currency
Domestic currency (*)
Fair value
12.31.20
03.31.20
12.31.20
03.31.20
12.31.20
03.31.20
12.31.20
03.31.20
(Sale) purchase
(Sale) purchaseOutstanding forward contracts - NDF
US Dollar
Hedge Accounting - Cash Flow
Sale
Purchase
4.2685
-
1,776
-5.3425 5.1370
4.2685 (230,888)
(380,500)
(1,233,528)
(1,624,177)
33,007 (359,644)
34,714 (196,174)
- (380,500)
178,326 (1,055,202)
(1,624,177)
34,784 (359,644)
Non-hedge Acccounting
Sale
Purchase
425,000
2,012,401
(106,236) 205,822
5.4119 5.4396
4.6227 (213,858)
(314,500)
4.7351 445,032 231,174
(1,157,373) 2,420,785
(1,453,833)
45,012 (190,392)
110,500
1,263,412
558,568
(61,224) 15,430
Futures B3 - Non - Hedge Accounting
DOL - dollar futures
5.1967
5.1987
DDI - future exchange coupon DI - 1 day:
(66,750) 129,818 (218,412)
54,750 (85,160)
(346,880)
(155,344)
70,725 40,315
674,627 (1,135,022)
284,629 (442,721)
2,350 1,443
(2,448)
(1,511)
(807,275)
367,677 209,585
65
(33) (26,473)
322 254 (343,960)
(*) Convenience conversion.
Biosev S.A.
Notes to the Interim Financial Statements
For the Nine-month Period Ended December 31, 2020 (Amounts in thousands of Brazilian reais, unless otherw ise stated)
26.1.2
Interest rate risk management
The Company is exposed to floating interest rates (Libor USD and CDI) arising from borrow ings and financing, advances from customers, cash and cash equivalents and short-term investments.
In order to hedge against variations that may impact its cash flow , the Company hedged a portion of its exposure (Debt indexed to the Libor USD) through derivative instruments (Cash Flow Sw ap) contracted w ith first class financial institutions, in order to exchange the exposure to the Libor USD for fixed interest rates.
These derivative instruments are broken dow n as follow s as at December 31, 2020:
Fixed averageCons olidate d Notional valueForeign currency
Domestic currency (*)
Fair value
Hedge Accounting |
Outstanding position: |
rate - % | |||||||
12.31.20 | 12.31.20 | 03.31.20 | 12.31.20 | 03.31.20 | 12.31.20 | 03.31.20 | |
Less than 1 year | 3.1467% | 39,967 | 39,967 | 207,695 | 207,775 | (14,536) | (11,367) |
1 to 2 years | 3.1467% | 39,967 | 39,967 | 207,695 | 207,775 | (8,311) | (10,659) |
2 to 5 years | 3.1467% | 16,035 | 56,002 | 83,329 | 291,136 | (2,283) | (5,937) |
95,968 | 135,936 | 498,718 | 706,686 | (25,130) | (27,963) |
(*) Convenience conversion.
26.1.3
Agricultural commodity risk management
The Company is exposed to the changes in sugar, ethanol and pow er prices that may impact its future income. In order to mitigate such market exposure, the Company's risk committee approves the volumes and price levels to be hedged as contracted by the Company's market intelligence desk.
As at December 31, 2020, the outstanding derivate instruments are broken dow n as follow s :
Com pany
Notional valueForeign currency
Domestic currency (*)
Fair valueSugar futures - ICE
Hedge Accounting - Cash Flow
Hedge Accounting - Fair Value Non-hedge Acccounting
Sugar options - ICE
Non-hedge Acccounting
Sugar options - OTC
Non-hedge Acccounting
NDF sugar - OTC
Non-hedge Acccounting
Ethanol futures - B3
Non-hedge Acccounting
(*) Convenience conversion.
12.31.20 | 03.31.20 | |
(157,266) | (138,660) | (817,265) |
99,870 | 132,652 | 518,993 |
8,177 | (5,365) | 42,492 |
(49,219) | (11,373) | (255,780) |
(2) | 2,359 | (12) |
(2) | 2,359 | (12) |
(10,545) | - | |
(10,545) | - | |
(9,822) | - | |
(9,822) | - | |
(425) | 128,623 | |
(425) | 128,623 | |
- -
- -24,751 24,751
12.31.20 | 03.31.20 | 12.31.20 | 03.31.20 |
(720,852) | (8,308) | (2,026) | |
689,618 | 6,566 | 1,600 | |
(27,889) | 593 | (6,159) | |
(59,123) | (1,149) | (6,585) | |
12,264 | (12) | 606 | |
12,264 | (12) | 606 | |
(54,820) | - | (836) | |
(54,820) | - | (836) | |
(51,062) | - | 1,156 | |
(51,062) | - | 1,156 | |
(2,211) | (317) | 218 | |
(2,211) | (317) | 218 | |
(1,478) | (5,441) | ||
43 |
Biosev S.A.
Notes to the Interim Financial Statements
For the Nine-month Period Ended December 31, 2020 (Amounts in thousands of Brazilian reais, unless otherw ise stated)
Cons olidate d
Notional valueForeign currency
Domestic currency (*)
Fair value
Sugar futures - ICE | |
Hedge Accounting - Cash Flow | |
Hedge Accounting - Fair Value | |
Non-hedge Acccounting | |
Sugar Sales Agreements | |
Hedge Accounting - Fair Value | |
Sugar options - ICE | |
Non-hedge Acccounting | |
Sugar options - OTC | |
Non-hedge Acccounting | - |
- | |
NDF sugar - OTC | |
Non-hedge Acccounting | - |
- | |
Power Sales Agreements | |
Non-hedge Acccounting | 19,279 |
19,279 | |
Ethanol futures - B3 | |
Non-hedge Acccounting | 24,751 |
24,751 | |
(*) Convenience conversion. |
12.31.20 | 03.31.20 | |
(157,266) | (138,660) | (817,265) |
99,870 | 132,652 | 518,993 |
8,177 | (5,365) | 42,492 |
(49,219) | (11,373) | (255,780) |
(99,870) | (132,652) | (518,993) |
(99,870) | (132,652) | (518,993) |
(2) | 2,359 | (12) |
(2) | 2,359 | (12) |
(14,035) | - | |
(14,035) | - | |
(9,822) | - | |
(9,822) | - | |
- | 100,186 | |
- | 100,186 | |
(425) | 128,623 | |
(425) | 128,623 | |
12.31.20 | 03.31.20 | 12.31.20 | 03.31.20 |
(720,852) | (8,308) | (2,026) | |
689,618 | 6,566 | 1,600 | |
(27,889) | 593 | (6,159) | |
(59,123) | (1,149) | (6,585) | |
(689,618) | (82,298) | 55,885 | |
(689,618) | (82,298) | 55,885 | |
12,264 | (12) | 606 | |
12,264 | (12) | 606 | |
(72,964) | - | (1,125) | |
(72,964) | - | (1,125) | |
(51,062) | - | 1,156 | |
(51,062) | - | 1,156 | |
- | (1,117) | - | |
- | (1,117) | - | |
(2,211) | (317) | 218 | |
(2,211) | (317) | 218 | |
(84,892) | 50,155 |
26.2
Credit risk
The credit risk is managed through the careful analysis of the customer portfolio, the definition of credit limits, and the ongoing control of outstanding positions. In conformity w ith the Company's credit policy, using a risk assessment methodology, the
Company adopted balanced scorecard techniques. The Company adopts hedging instruments, such as collaterals, pledges and guarantees, to mitigate potential credit exposures. Historically, the Company does not record significant losses in trade receivables.
26.3
Liquidity risk and capital management
Company monitors capital through financial leverage index analysis; these indexes include adjusted net debt to adjusted EBITDA ratio. In turn, the net debt corresponds to total borrow ings and financing (including short- and long-term borrow ings and financing), plus interest sw ap, less cash, cash equivalents, short-term investments and highly liquid inventory (ethanol, sugar and allow ance for negative inventory margin).
Moreover, the products manufactured by the Company are highly liquid and can be easily sold to generate cash or also be provided as a guarantee for financial transactions.
Biosev S.A.
Notes to the Interim Financial Statements
For the Nine-month Period Ended December 31, 2020 (Amounts in thousands of Brazilian reais, unless otherw ise stated)The contractual obligations and financial commitments that may impact the Company's liquidity are broken dow n below :
Com pany
Less than 1 | 1 to 5 years | Over 5 years | Total | |
As at December 31, 2020 | ||||
Borrow ings and financing | 1,318,124 | 1,590,611 | 105,908 | 3,014,643 |
Lease liability | 207,270 | 525,384 | 103,624 | 836,278 |
Derivative financial instruments | 120,108 | - | - | 120,108 |
Trade payables | 287,643 | 4,286 | - | 291,929 |
Accrued payroll and related taxes | 48,704 | - | - | 48,704 |
Taxes payable | 13,891 | 18,324 | - | 32,215 |
Other payables | 51,840 | 72,577 | - | 124,417 |
2,047,579 | 2,211,182 | 209,532 | 4,468,294 | |
As at March 31, 2020 | ||||
Borrow ings and financing | 2,935,559 | 67,484 | - | 3,003,043 |
Lease liability | 215,257 | 444,809 | 72,048 | 732,114 |
Derivative financial instruments | 575,188 | - | - | 575,188 |
Trade payables | 309,104 | 5,733 | - | 314,837 |
Accrued payroll and related taxes | 47,218 | - | - | 47,218 |
Taxes payable | 21,314 | 18,501 | - | 39,815 |
Other payables | 80,594 | 86,047 | - | 166,641 |
4,184,234 | 622,574 | 72,048 | 4,878,856 | |
Less than 1 | Total | |||
As at December 31, 2020 | ||||
Borrow ings and financing | 3,058,308 | 6,914,560 | ||
Lease liability | 561,217 | 2,135,265 | ||
Derivative financial instruments | 231,324 | 241,918 | ||
Trade payables | 663,105 | 667,634 | ||
Accrued payroll and related taxes | 93,903 | 93,903 | ||
Taxes payable | 57,000 | 75,324 | ||
Other payables | 94,961 | 244,031 | ||
4,759,819 | 10,372,635 | |||
As at March 31, 2020 | ||||
Borrow ings and financing | 7,225,234 | 7,321,425 | ||
Lease liability | 498,932 | 1,681,269 | ||
Derivative financial instruments | 586,843 | 603,439 | ||
Trade payables | 798,903 | 804,868 | ||
Accrued payroll and related taxes | 90,483 | 90,483 | ||
Taxes payable | 75,152 | 93,653 | ||
Other payables | 118,051 | 285,298 | ||
9,393,598 | 10,880,435 |
Cons olidate d
1 to 5 yearsOver 5 years
3,746,367 109,885
1,305,407 268,641
10,594
4,529 -
18,324
149,070 5,234,290
- - - - - 378,526
96,191
1,029,154
16,596
5,965 -
18,501
167,247 1,333,654
- 153,183 - - - - - 153,183
Biosev S.A.
Notes to the Interim Financial Statements
For the Nine-month Period Ended December 31, 2020 (Amounts in thousands of Brazilian reais, unless otherw ise stated)
26.4 Margin calls
Derivative transactions in commodity exchanges (ICE and B3) require an initial margin call in guarantee.
To trade on the ICE, the margin call required, as at December 31, 2020, is R$22,461 (R$7,376 as at March 31, 2020), fully deposited by the Company's in cash, through fiduciary agent Term Commodities Inc., a company under common control.
To trade on the B3, the margin call required, as at December 31, 2020, is R$43,312 (R$26,502 as at March 31, 2020), deposited in current account.
As at December 31, 2020, the Company's transactions in the over-the-counter market did not require an initial margin call in guarantee.
26.5
Categories of financial instruments
The financial instruments recognized in the balance sheet are stated at contractual value, as the characteristics of these financial instruments approximate their market value, except for derivative instruments and lease liabilities, w hich are stated at market value. The categories are described below :
Com pany
Cons olidate d
Clas s ification | |||||
CPC 48 / IFRS 9 | 12.31.20 | 03.31.20 | 12.31.20 | 03.31.20 | |
Financial assets: | |||||
Cash and cash equivalents (Note 3) | Amortized cost | 141,536 | 396,124 | 484,178 | 1,174,943 |
Short-term investments and debentures (Note 4) | Amortized cost | 71,453 | 42,052 | 127,949 | 52,245 |
Trade receivables (Note 5) | Amortized cost | 159,191 | 211,537 | 279,203 | 216,242 |
Other financial assets | Amortized cost | 482,012 | 572,469 | 685,797 | 793,595 |
Derivatives designated as hedge accounting (Note 26) | VJR | 51,775 | 225,676 | 65,041 | 281,561 |
Derivatives designated as cash flow hedge (Note 26) | V JORA | 40,381 | 111 | 40,382 | 111 |
- | - | ||||
Financial liabilities: | - | - | |||
Borrow ings and financing (Note 16) | Amortized cost | 3,014,643 | 3,003,043 | 6,914,560 | 7,321,425 |
Lease liability (Note 12) | Amortized cost | 836,278 | 732,114 | 2,135,265 | 1,681,269 |
Trade payables (Note 17) | Amortized cost | 291,929 | 314,837 | 667,634 | 804,868 |
Other financial liabilities | Amortized cost | 205,335 | 253,674 | 413,258 | 469,434 |
Derivatives designated as fair value hedge or not (Note 26) | VJR | 106,203 | 361,781 | 202,883 | 389,743 |
Derivatives designated as cash flow hedge (Note 26) | V JORA | 13,906 | 213,407 | 39,035 | 213,696 |
26.6
Measurement at fair value recognized in balance sheet
CPC 40 (R1) - Instrumentos Financeiros: Evidenciação/IFRS 7 - Financial Instruments: Disclosure defines fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the primary or most advantageous market for the asset or liability in an orderly transaction betw een market participants on the measurement date. CPC 40 (R1)/IFRS 7 also establishes a three-level fair value hierarchy, which prioritizes inputs for fair value measurement by an entity in order to maximize the use of observable data and minimize the use of unobservable data. CPC 40 (R1)/IFRS 7 describes the three levels of inputs that should be used to measure fair value, w hich are the follow ing:
•
Level 1 - Quoted prices (unadjusted) in active markets for identical assets and liabilities.
•
Level 2 - Inputs other than the data included in Level 1, w here prices are quoted (unadjusted).
Fair value measurements of Level 2 are obtained based on other variables besides quoted prices included in Level 1, w hich are directly or indirectly observable for an asset or liability.
• Level 3 - Inputs for the asset or liability that are not based on observable market data (unobservable inputs) because market activity is insignificant or does not exist.
Biosev S.A.
Notes to the Interim Financial Statements
For the Nine-month Period Ended December 31, 2020 (Amounts in thousands of Brazilian reais, unless otherw ise stated)
The Company's financial assets and liabilities measured at fair value on a recurring basis and subject to disclosure as required by CPC 40 (R1)/IFRS 7, as at December 31, 2020, are as follow s:
Com pany 12.31.20
Level 1
Level 2
Total
Level 1
TotalCons olidate d 12.31.20 Level 2
-
92,156
92,156
-105,423
105,423
Financial assets at fair value through profit or loss Derivative financial assets
-
92,156
92,156
-105,423
105,423
(1,511)
(118,598)
(120,109)
(1,510)
(240,408) (241,918)
Financial liabilities at fair value through profit or loss Derivative financial liabilities
(1,511)
(118,598)
(120,109)
(1,510)
(240,408) (241,918)
Com pany 03.31.20
Cons olidate d 03.31.20
Level 1
Level 2
Total
Level 1
Level 2
TotalFinancial assets at fair value through profit or loss Derivative financial assets
15,885 15,885
209,902 209,902
225,787 225,787
15,886 15,886
265,786 265,786
281,672 281,672
(22,000)
(553,188)
(575,188)
(21,999)
(581,440) (603,439)
Financial liabilities at fair value through profit or loss Derivative financial liabilities
(22,000)
(553,188)
(575,188)
(21,999)
(581,440) (603,439)
26.7
Derivative and non-derivative financial instruments with the application of hedge accounting
InaccordancewithaccountingpracticesadoptedinBrazil,derivativefinancialinstrumentsareaccountedforatfairvalue through profit or loss, unless a derivative is designated for hedge accounting. A derivative only qualifies for hedge accounting whenalltheconditionssetoutbyCPC48/IFRS9aremet.Theadoptionofhedgeaccountingisoptionalandaimsat recognizing gains or losses on derivatives and debts only w hen the hedged item is realized on an accrual basis and, therefore, reducing the volatility of gains or losses from the mark-to-market of derivatives.
The Company applies hedge accounting to account for part of its derivative and non-derivative financial instruments.
26.7.1 Cash flow hedge
The cash flow hedge is in conformity w ith CPC 48/IFRS 9, items 6.3.3/9 6.2.2, and is described below :
• Recognized liability hedge - debts subject to the Libor rate: The Company entered into sw ap contracts subject to the Libor interest rate contracted to mitigate the effects from interest rate changes of the long-term debts, in w hich case the respective exposure is subject to a fixed interest rate.
• Highly probable transaction hedge - Revenue from sugar and ethanol exports in US dollar: The Company entered into i) sugar futures contracts for purposes of price risk hedge; and ii) currency forw ard contracts (NDF) and US dollar-denominated debts (Natural HACC), both contracted to protect against exchange rate changes in the revenue from exports.
• Highly probable transaction hedge - Cost related to the future purchase of agricultural inputs in US dollar: Effective on July 22, 2021, the Company enters into currency forw ard contracts (NDF) to protect against exchange rate changes in the invoicing, upon issuance of the invoice and, therefore, the exposure is terminated.
26.7.2 Fair value hedge
Such hedge comprises the use of "sugar futures" derivative instruments to protect against changes in fair value in connection w ith a sugar sales agreement entered into w ith a third party.
Biosev S.A.
Notes to the Interim Financial Statements
For the Nine-month Period Ended December 31, 2020 (Amounts in thousands of Brazilian reais, unless otherw ise stated)
26.7.3
Discontinued hedge accounting
As at March 31, 2019, the Company discontinued the revenue hedge accounting program (Natural HACC) w ith respect to the debts already designated. Such discontinuity resulted from the change in the Company's foreign exchange risk management, w hich aimed to offset the exchange rate changes of the debts against equity, w hich w ill be directly recorded in the finance income (costs) to be offset against the long positions expressed in foreign currency using derivative financial instruments - also recognized in finance income (costs) (CPC 48, items B6.5.26 (a) and B6.5.28 (b)).
The gains and losses recorded in equity, in line item "Other comprehensive income (loss), w ill be maintained in this reserve until the expected transaction is concluded, in w hich case the amounts w ill be reclassified to operating income (revenues) - alignedwithrevenues.Intheeventsuchtransaction(revenue)isnotconcluded,theaccumulatedamountswillbefully reclassified to finance income (costs) under CPC 48.
As at December 31, 2020, the annual expected realization of derivatives recorded in equity is as follow s:
Com pany
He d g e
Im pact
2020/2021
2021/2022
Exchange rate changes on future interest flow s (*)
Finance income (costs)
(1,226)
(3,854)
(2,367) (1,226)
(1,226)
(3,854)He d g e
Im pact
2020/2021
2021/2022
Exchange rate changes on future interest flow s (*) HACC Natural
Finance costs Operating losses
(1,226)
- (1,226)
(3,854) (79,173)
(83,027)
(*) Program discontinued in prior years.
2024/2025 | 2025 to 2028 | Total | |
(733) | (759) | (10,165) | |
(733) | (759) | (10,165) | |
Cons olidate d | |||
2022/2023 2023/2024 | 2024/2025 | 2025 to 2028 | Total |
(733) | (759) | (10,165) | |
- | - | (183,890) | |
(733) | (759) | (194,055) | |
48 |
2022/2023 2023/2024
(2,367) (1,226)
(2,367) (1,226) (79,173) (25,544)
(81,540)
(26,770)
Biosev S.A.
Notes to the Interim Financial Statements
For the Nine-month Period Ended December 31, 2020 (Amounts in thousands of Brazilian reais, unless otherw ise stated)
26.7.4
Sensitivity analysis
The table below show s the Company's sensitivity to the presented risk factor, based on changes in the risk factor considered reasonably possible by management (probable scenario), w hich takes into account the current volatility of the asset - in addition to other tw o scenarios, based on w hich the market conditions are subject to 25% and 50% stress scenarios.
The probable scenario is obtained based on future dollar, sugar, ethanol and pow er (as at December 31, 2020) and the Group's expectations for each one of the variables indicated, over a tw elve-month period.
Com pany
Notional amount
Foreign currencyExchange risk Price risk
Sugar hedge accounting Ethanol
Effects on equity Exchange risk Price risk
(347,181) 132,795 108,044 24,751 (214,386) (196,174) (157,266)
Sugar hedge accounting Effects on equity
(157,266)
(353,441)
Risk factor | |||
Increase in US$ | (1,018,856) | (1,263,926) | (2,527,851) |
Decrease in price | 201,401 | 157,750 | 315,512 |
Increase in price | 206,921 | 163,553 | 327,118 |
Decrease in price | (5,520) | (5,803) | (11,606) |
(817,455) | (1,106,176) | (2,212,340) | |
Increase in US$ | 205,480 | 254,905 | 509,809 |
Increase in price | (295,657) | (233,694) | (467,388) |
Increase in price | (295,657) | (233,694) | (467,388) |
(90,177) | 21,211 | 42,421 |
Effects on fair value Probable scenario 25% stress 50% stress
Cons olidate d
Risk factor
Probable
25% stress
50% stressNotional amount Foreign currencyEffects on fair valueExchange risk Price risk
(906,688)Increase in US$
(1,765,014)
(2,189,559)
(4,379,119)
Sugar hedge accounting Ethanol
Energia
52,204 8,175 24,751 19,279
Decrease in price Decrease in price
Decrease in price Decrease in price
1,729 16,741 (5,520) (9,492)
4,356 8,723
13,230 26,472 (5,803) (11,606) (3,072) (6,143)
Effects on equity
(1,763,284)
(2,185,204)
(4,370,396)
(233,694) (467,388)
Exchange risk Price risk
(854,483) (196,174) (157,266)
Increase in US$ Decrease in price
205,480 (295,657)
254,905
509,809
Sugar hedge accounting Interest rate risk
(157,266)
Increase in price
(295,657)
(233,694) (467,388)
Effects on equity
95,968 Decrease in Libor rate (257,472)
(186)
(372)
(744)
(90,363)
20,839
41,678
As at December 31, 2020, the probable scenario considers the CDI rate projected for 12 months - disclosed at B3's w ebsite (DI sw ap reference rates x PRÉ) and the Libor rate for 12 months disclosed by Bloomberg. These rates w ere applied in the Company's exposure volume - composed of: borrowings and financing, advances from customers, cash and cash equivalents and short-term investments.
Based on the exposure in the probable scenario, a stress of 25% and 50% w as applied taking into account the w orst case scenarios in order to determine the impact on the Company's finance income (costs).
Theconsolidatedsensitivityresultsarebrokendownbelow:
Com pany
Probable
Notional amountscenario
25% stress
50% stress
(7,674) (11,511)
(2,804,184)
(12,792)
(15,991) (23,986)
Operations indexed to CDI Operations indexed to Libor Total
(221,639) (2,582,545)
(6,139) (6,653)
(8,317) (12,475)
Notional amountCons olidate d Probable scenario 25% stress
50% stress
(12,444) (18,667)
(6,318,167)
(25,308)
(31,633) (47,451)
Operations indexed to CDI Operations indexed to Libor Total
(359,406) (5,958,761)
(9,956) (15,352)
(19,189) (28,784)
Biosev S.A.
Notes to the Interim Financial Statements
For the Nine-month Period Ended December 31, 2020 (Amounts in thousands of Brazilian reais, unless otherw ise stated)
27. COMMITMENTS
a) Selling
The Group has several arrangements in the sugar and ethanol market under w hich it commits to sell volumes of these products in future crops. As at December 31, 2020, the volumes of these commitments total -1,315,234.61 tons of sugar (1,693,385 tons of sugar as at March 31, 2020), 122,822 cubic meters of ethanol (211,440 cubic meters as at March 31, 2020), and electricity supply commitments, assumed in pow er auctions and free market, w hich total 6,221 GWh to be supplied by 2035 (7,595 GWh as at March 31, 2020).
b) Purchases
The Group has several commitments for the purchase of sugarcane from third parties to ensure part of its production in future crops. The volume of sugarcane to be purchased is estimated based on the expected productivity of the areas w here the sugarcane plantations are located. The amount to be paid by the Group is determined at the end of each harvest campaign according to the price published by CONSECA NA, plus or less other applicable contractual terms.
As at December 31, 2020, estimated purchase commitments by crop are as follow s:
Cons olidate d
Estimated quantity | Es tim ate d | ||
Harvest | Area (hectares) | of cane (ton) | am ount |
2021/2022 | 119,228 | 9,141,541 | 813,053,466 |
2022/2023 | 93,049 | 7,207,772 | 641,062,991 |
2023/2024 | 73,357 | 5,595,239 | 497,643,514 |
2024/2025 | 45,849 | 3,621,041 | 322,057,262 |
After 2025 | 113,014 | 8,426,270 | 749,436,898 |
444,497 | 33,991,863 | 3,023,254,131 |
The Group has commitments for the purchase of energy in the amount of 316 GWh (1,048 GWh as at March 31, 2020). The price of these agreements is bilaterally negotiated by the agents selling electric energy in the Free Trade Market (ACL).
c) Terminalde Exportação de Açúcar do Guarujá Limitada - TEAG
TEAG is a party to an agreement for the lease of a port terminal with Companhia Docas do Estado de São Paulo ("CODESP"), w hich provides for the payment by TEAG, as lease, of a fixed monthly installment of R$3.4163/m² calculated on a minimum area of 74,206.410 m² equivalent to R$253.51 per month or R$3,042 per year, plus a guaranteed variable minimum installment equivalent to R$7,559 per year payable to CODESP, corresponding to R$3.103/ton calculated on a minimum handling of tw o million four hundred and thirty-six thousand tons of cargo. TEAG operates under the concession agreement entered into w ith Companhia Docas do Estado de São Paulo (CODESP), falling due on July 6, 2038.
d) Lawsuits against Instituto do Açúcar e do Álcool - IAA
The Company is a plaintiff in law suits seeking a compensation from the Federal Government for losses arising from pricing differences incurred in the period in w hich sugar and ethanol prices w ere frozen. In some cases, upon effective receipt of the indemnities, a portion of the amount received will be transferred on behalf of third parties in connection with the contractual obligations.
e) Bank guarantees and collateral insurance
As at December 31, 2020, the balances of (i) bank guarantee is R$144,198 in Consolidated (R$142,240 in Consolidated as at March 31, 2020); and (ii) collateral insurance relating to lawsuits of R$250,129, in Company, and R$667,326 in Consolidated (R$277,600 and R$588,750 as at March 31, 2020, respectively).
Biosev S.A.
Notes to the Interim Financial Statements
For the Nine-month Period Ended December 31, 2020 (Amounts in thousands of Brazilian reais, unless otherw ise stated)
28. EMPLOYEES' BENEFIT
The consolidated amount invested by the Company in the pension plan w as R$1,281 in the period ended December 31, 2020 (R$1,040 in the period ended December 31, 2019), recognized in line item "General, administrative and selling expenses". Due to the features and design of the pension plan, the Company does not incur any future postemployment or actuarial obligations.
As at December 31, 2020, the Company booked a liability related to the deferred variable compensation that w ill be paid to some eligible employees, according to the policy, in the amount of R$28,101 (R$26,021 as at March 31, 2020). Additionally, the Company has recorded a liability related to PPR (Profit Sharing Program), as set forth in the Collective Labor Agreement, in the amount of R$28,830 (R$31,550 as at March 31, 2020).
29. SEGMENT INFORMATION
Information by product margin, and geographic areas, used by the key decision makers is as follow s:
Cons olidate d
Three-month period ended 12.31.20
Consolidated profit (loss) by product | Sugar | Total | |||
Net revenue | 1,107,815 | 2,868,662 | |||
Cost of sales and services | (758,009) | (2,238,320) | |||
Gross profit | 349,806 | 630,342 | |||
Gross margin | 32% | 22% | |||
Selling expenses | (61,694) | (105,029) | |||
Operating margin | 288,112 | 525,313 | |||
Sales by geographic area | Sugar | Ethanol | Total | ||
Asia | 710,120 | 481,558 | - | 477,399 | 1,669,077 |
North America | 28,406 | 40,860 | - | 51,118 | 120,384 |
South America | 7,483 | 909 | - | - | 8,392 |
Africa | 284,797 | 516 | - | 43,088 | 328,401 |
Europe | 767 | 5,528 | - | 135,578 | 141,873 |
Oceania | 470 | - | - | - | 470 |
Foreign market | 1,032,043 | 529,371 | - | 707,183 | 2,268,597 |
Domestic market | 75,772 | 304,663 | 199,627 | 20,003 | 600,065 |
TOTAL | 1,107,815 | 834,034 | 199,627 | 727,186 | 2,868,662 |
Cons olidate d
Ethanol 834,034 (566,093) 267,941
Energy 199,627 (189,184)Othe r 727,186 (725,034)
10,443 2,152
32% (39,953) 227,988
5% 0%
(2,971) (411)
7,472 1,741
Three-month period ended 12.31.20
Biosev S.A.
Notes to the Interim Financial Statements
For the Nine-month Period Ended December 31, 2020 (Amounts in thousands of Brazilian reais, unless otherw ise stated)
Cons olidate d
Three-month period ended 12.31.19
Consolidated profit (loss) by productSugarEthanol Energy Othe r
TotalNet revenue
451,943
520,497
68,978
348,128
1,389,546
(424,594)
(353,750) (1,217,363)
Cost of sales and services Gross profit
27,349
(386,813) 133,684
(52,206) 16,772
(5,622)
172,183
(37,934) (2,128)
(194)Gross margin Selling expenses Operating margin
6%
26%
(10,585) 131,556
24% (2,026) 14,746
(5,816)
-2%
12% (42,282) 129,901
Cons olidate dThree-month period ended 12.31.19
North America South America Africa
9,413 - - - 9,413
Europe
23,700 396
- -- -
1,816 25,516
37,691 38,087
Nine-month period ended 12.31.20
Consolidated profit (loss) by product
Cost of sales and services
Net revenue
Gross profit (loss)
Sugar 3,077,873 (1,839,728) 1,238,145
Ethanol 1,848,845 (1,123,805)
725,040
Energy 448,550 (334,853) 113,697
Othe r 3,147,623 (3,166,566)
(18,943)
Total 8,522,891 (6,464,952) 2,057,939
Gross margin
40% (224,874) 1,013,271
39% (64,928) 660,112
25%
-1%
24%
Selling expenses
(1,083) (299,430)
Operating margin
(8,545) 105,152
(20,026) 1,758,509
Biosev S.A.
Notes to the Interim Financial Statements
For the Nine-month Period Ended December 31, 2020 (Amounts in thousands of Brazilian reais, unless otherw ise stated)
Cons olidate d
Nine-month period ended 12.31.20
Energy Othe r
Total
- - - -
- 116,376 441,017
117,688 970,915
Sales by geographic area Asia
North America South America Africa
Sugar 1,820,205 119,125 7,483 853,227
Ethanol 821,842 205,516 36,565 --2,320,721
4,962,768
- 44,048
Cons olidate d
Nine-month period ended 12.31.19
Consolidated profit (loss) by product Net revenue
Cost of sales and services Gross profit
Sugar 1,204,825 (1,109,795)
Ethanol 1,939,982 (1,474,789)
Energy 270,343 (161,439) 108,904
Othe r 1,245,219 (1,249,783)
Total 4,660,369 (3,995,806)
95,030
465,193
(4,564)
664,563
(122,296) (24,422)
(323)
Gross margin Selling expenses Operating margin
8%
24%
(27,266) 440,771
(7,145) 101,759
40%
(4,887)
0%
14% (154,186) 510,377
Cons olidate dNine-month period ended 12.31.19
Energy Othe r
TotalSales by geographic area Asia
Sugar 814,573
Ethanol 11,983
-1,018,773
1,845,329
121,581 232,628 - - 354,209
12,266 107,371
North America South America Africa
26,026 - - - 26,026
Europe
95,105 35,721 1,093,006 111,819 1,204,825
- - 244,611 1,695,371 1,939,982
- -
177,986 213,707
- 1,209,025 2,546,642
Foreign market Domestic market
270,343 270,343
36,194 2,113,727
TOTAL
1,245,219
4,660,369
The Company's key decision makers use the operating margin as a tool to measure the recurring operating cash generation capacity and it also allow s comparisons w ith other companies.
Cons olidate d | Cons olidate d |
Three-month period | Nine-month period |
ended | ended |
12.31.20 | 12.31.19 | 12.31.20 | 12.31.19 | |
Operating margin | 525,313 | 129,901 | 1,758,509 | 510,377 |
Other operating expenses | (177,963) | (80,268) | (362,330) | (220,292) |
Finance costs | 290,421 | 48,847 | (507,783) | (740,749) |
Income tax and social contribution | (326,154) | (95,623) | (434,496) | (19,708) |
Profit (loss) for the period | 311,617 | 2,857 | 453,900 | (470,372) |
Biosev S.A.
Notes to the Interim Financial Statements
For the Nine-month Period Ended December 31, 2020 (Amounts in thousands of Brazilian reais, unless otherw ise stated)
Information on key customers
In the period ended December 31, 2020, the Group has one customer, its related party Louis Dreyfus Company Suisse S.A.,
undercommoncontrol,whichaccountsfor56%oftheGroup'sconsolidatedrevenue.
30.
SUBSEQUENT EVENTS
According to the material fact disclosed on February 8, 2021, Biosev S.A. ("Company"), its parent company Hédera Investimentos e Participações S.A. ("Hédera"), Raízen S.A. and Raízen Combustíveis S.A., among others, entered into the acquisitionagreement,onthesamedate,whereby,uponcompliancewithcertainsuspensiveconditions,includingthe approval of the transaction by the Administrative Council of Economic Defense (CADE), Company shall become the subsidiary of one or both companies Raízen, or the subsidiary of a holding company that ow ns the companies Raízen
("Transaction"). In this context, the Company's shares will be merged into Hédera, in which case the Company's shareholderswillbecometheHédera'sshareholdersand,aftertheimplementation oftheTransaction,theshareholderswil hold indirect equity (through Hédera) in, represented by preferred shares w ith no voting right, the companies Raízen or in one of them, or in a holding company that owns the companies Raízen. The Transaction also comprises the Company's debtreorganization,whichwillresultinthe(i)assumptionofthedebtportionbyHéderathroughthesignatureofnew financing agreements entered into w ith the Company's creditors; and (ii) payment w ith the funds arising from the Company's capitalization by Raízen, in the amount of R$3.6 billion, after common adjustments to net debt and w orking capital, as w ell as other operational adjustments by virtue of the conduction of businesses through the closing of the Transaction.
31.
APPROVAL OF INTERIM FINANCIAL STATEMENTS
The interim financial statements wereapproved by the Company's Management and authorized for issue on February 11, 2021.
Biosev S.A.
Notes to the Interim Financial Statements
For the Nine-month Period Ended December 31, 2020 (Amounts in thousands of Brazilian reais, unless otherw ise stated)
NON-STATUTORY AUDIT COMMITTEE OPINION
The non-statutory Audit Committee of Biosev S.A. ("Company"), jointly w ith representatives of the Company and of BDO
RCS Auditores Independentes, independent auditors of the Company, examined the interim financial statements of the Company related to the period ended on December 31st, 2020 and the corresponding management reports. Based in the analysis performed and considering the draft of the audit report, without remarks, prepared by BDO RCS Auditores Independentes, the non-statutory Audit Committee of the Company recommended to the Board of Directors of the Company, unanimously and without remarks, the approval of the referred interim financial statements and the corresponding management reports.
São Paulo, February 10th, 2021
FEDERICO ADRIAN CERISOLI
PATRICK JULIEN TREUERADRIAN LIMADA HORA
Biosev S.A.
Notes to the Interim Financial Statements
For the Nine-month Period Ended December 31, 2020 (Amounts in thousands of Brazilian reais, unless otherw ise stated)
OPINIONS AND STATEMENTS
As Executive Officers of Biosev S.A., w e declare, under Article 25, Paragraph 1st, Item VI of CVM Instruction nº 480 of December 7, 2009, as amended, that we have reviewed, discussed and agreed with the interim financial statements and the terms of the independent auditors report on the interim financial statements related to the period ended on December 31st, 2020.
São Paulo, February 11th, 2021
Juan Jose Blanchard
Chief Executive Officer
Leonardo Oliveira D'Elia
Chief Financial and Investor Relations Officer
Ricardo Lopes da Silva
Chief Operating Officer
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Biosev SA published this content on 11 February 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 12 February 2021 08:35:10 UTC.