Cosan Limited : Cosan’s Net Revenue up 28% to R$30 billion

- Results for 2013 fiscal year show 28% increase in revenue.
- Consolidated EBITDA increases 48%, to R$3.1 billion.
- Comgás contributes with EBITDA of R$471.5 million
- Radar's lands portfolio reaches R$2.5 billion

São Paulo, June 5, 2013 - Cosan S.A. (BM&FBovespa: CSAN3) registered consolidated net revenue of R$30 billion in the 2013 fiscal year, beginning on April 1, 2012 and ended on March 31, 2013. The result represents an increase of 28.3% compared to the same period in 2012 when revenue totaled R$23 billion. Consolidated EBITDA also grew 48%, from R$2.1 billion to R$3.1 billion.

Net income for the period, excluding the effects of the formation of Raizen, grew 34.6%, from R$474 million to R$638.2 million.

The slower economic growth and the international crisis this year strengthened our focus on operating efficiency. We have evolved in various aspects of our business portfolio and continued in our strategy of growing in the Energy and Infrastructure sectors.

Accordingly, we began integrating Comgás, aligning corporate cultures and identifying key talent. Comgás has provided Cosan with an entirely new perspective on the oil and natural gas industry, making the Company an unquestionable player in this important energy segment.

Quarter-over-quarter, Cosan's net revenue increased 47.4% to R$8.5 billion in the last three months of the 2013 fiscal year, compared to R$5.8 billion in the same period of the 2012 fiscal year. The consolidated EBITDA increased from R$489.1 million to R$915.6 million, up 87%. Net income totaled R$29.7 million.

Raízen Combustíveis

The 5% increase in the volume of fuel sold compared to the previous fiscal year helped Raizen Combustíveis end 2013 with net revenues 9.7% higher than in 2012, totaling R$43.5 billion. Moreover, the average price of products sold grew up by 4.5%, chiefly driven by the rise in average gasoline and diesel fuel prices announced by Petrobras on 1Q12.

Raizen Combustíveis' EBITDA was 25.5% higher than that reported in 2012 at R$1.7 billion, with a margin of 3.8%. In the fourth quarter of the 2013 fiscal year, this growth was 20.5% compared with the same period in 2012, totaling R$422.9 million with a margin of 3.9%. In terms of sales volumed, EBITDA margin reached R$ 79.6/m³ in the quarter.

The main factors that led to growth in EBITDA were the expansion of the Shell network through the rebranding process, the increased penetration of premium products (V-Power Gasoline and Ethanol and Evolux Diesel), the higher mix of gasoline sales in the total otto cycle and the improvement of the portfolio of contracts for industrial (B2B) customers. 

Raízen Energia

The increased sales volumes of sugar and electricity from cogeneration boosted Raizen Energia's revenue in the fiscal year, together with higher average prices of sugar, ethanol and electricity. In the 2013 fiscal year, net revenue totaled R$8.5 billion, representing a growth of 16.8% over the amount reported for the previous year, when revenue totaled R$7.2 billion.

In the last quarter of 2013, net revenue was R$2.4 billion, up 97% over the last quarter of the previous year due to the delayed 2012/2013 harvest and a longer operating period at production units.

Raizen Energia's EBITDA presented quarterly growth of 9.4%, from R$375.2 million in the fourth quarter of the 2012 fiscal year to R$410.5 million in the same period of 2013. For the year, the unit's EBITDA reached R$2.4 billion, up 13.9% as compared to 2012, when the reported value was R$2.1 billion. EBITDA margin in 2013 was 28.4%.

Among the initiatives implemented this year in the ethanol, sugar and bioenergy segment, many of which seek to reduce capital needs, we highlight the launch of a major partnership program with our sugarcane suppliers, "Cultivar," to increase  efficiency and the percentage of third party sugarcane in our crushing.

Comgás

Comgás uses the calendar year in its financial statements as a business performance calculation period. During the first quarter of 2013 (period from January to March, corresponding to the fourth quarter of Cosan's 2013 fiscal year), the company maintained its strategic focus on the residential sector and in the development of commercial and industrial segments, the latter the most significant in terms of volume sold.

In the residential segment, 41.8 million cubic meters of gas were distributed in the first quarter, 2.3% higher than the volume distributed in the same period of 2012, totaling 40.8 million m³. The residential segment ended the quarter with 897,974 connected meters, an increase of 6.8% (840,915 meters), with a contribution margin of 20%.

For the commercial segment, 25.8 million cubic meters of gas were distributed, representing a decrease of 1.5% as compared to the first three months of 2012, in which the total volume distributed was 26.2 million m³. In the quarter, 167 new commercial clients were connected.
The volume of the industrial segment amounted to 928.1 million cubic meters of gas in the first quarter of 2013, 0.7% less than the 934.5 million cubic meters distributed in the same period in 2012.

As a result, net sales and services revenues totaled R$1.4 billion, an increase of 29.2% over the same period of 2012. EBITDA was R$314.4 million, an increase of 42.8% year-over0-year, totaling R$220.2 million.

Rumo Logística

Rumo showed growth of over 75% in transported volume, making Cosan responsible for the shipment of approximately half of all sugar exported through the Port of Santos. According to information from Sugar Cane Industry Association (UNICA) based on data provided by the Bureau of Foreign Trade (SECEX), the Port of Santos was responsible for 69.5% of the total volume of sugar exported by Brazil, and Rumo handled approximately 48% of this total.

Accordingly, the unit's net revenue totaled R$168.4 million in the fourth quarter, up 126.7% over the same period of the previous year. For the year, revenue reached R$712.8 million, an increase of 24.6% as compared to 2012.

EBITDA was R$296.7 million with margin at 41.6%, an increase of 39.2% and 4.4 percentage points respectively, as compared to 2012. The result is in line with the company's growth plan, marked by the start of operations of the Itirapina Terminal, the conclusion of part of the investments in Port of Santos and the significant increase of the transportation operation.

Radar Propriedades Agrícolas

Radar, Cosan's business unit that invests in agricultural properties and land leasing in the rural real estate market, ended 2013 fiscal year with a property portfolio valued at R$2.5 billion and total area of 107.5 thousand hectares (265.6 thousand acres), distributed among six Brazilian states: São Paulo, Maranhão, Mato Grosso, Bahia, Goiás and Mato Grosso do Sul .

Radar's net revenue is derived from the sale of assets and leasing of agricultural lands. In 4Q13, no properties were sold and Radar's net revenue came from leasing, reaching a total of R$15.6 million. The 23.5% decline is associated with the variation in agricultural commodities prices, as well as other variables that impact land leasing prices.

In the 2013 fiscal year, Radar's net revenue grew 27.6% as compared to 2012, totaling R$86.9 million, primarily due to the sale of properties.

Radar reported EBITDA of R$65.2 million in 4Q13. In FY13, EBITDA was R$192.9 million, down 34.1% compared to the previous year, mainly explained by the recognition of fair market value of the land portfolio, which was higher in FY12 due the completion of the first independent assessment, showing gains that had not been captured previously.

Other Businesses

Income in Other Businesses segment's consists of manufacturing and distribution activities for lubricants and automotive specialties under the Mobil and Comma brands, base oil distribution, and the Cosan corporate structure, except for Raízen.

Net revenue from lubricant and other product sales in 4Q13 reached R$357.7 million, up 32% over 4Q12's R$270.9 million. In 2013 fiscal year, net revenue was R$1.4 billion, an increase of 33.5% as compared to 2012 from operations outside Brazil. Net revenue from operations in Brazil also grew due to a 7% increase in sales volume. The average unit price for lubricants and base oils reached R$4,965/m3 in 2013.

In 4T13, adjusted EBITDA was R$54.1 million and in FY13, R$92.7 million, up 90.2% as compared to FY12.

Debt

Cash and cash equivalents totaled R$2.6 billion at the end of the fourth quarter of 2013, as compared with R$2.3 billion in the third quarter of the same year. Net debt for the quarter was R$8.6 billion, compared to R$8.8 billion in the previous quarter, equivalent to leverage of 2.3 times pro-forma LTM EBITDA, which considers Comgás and Radar.

The main events in the period were: promissory note issue in the amount of R$400 million by Comgás, in addition to the issue of the 2018 and 2023 Senior Notes in the amount of R$1.8 billion, which were used for prepayment the 1st series debentures issue for the Comgás acquisition in the amount of R$1.9 billion.

About Cosan:

Cosan is one of Brazil's largest private economic groups, with businesses in the energy and infrastructure sectors. The Group is composed of Rumo Logística, Cosan Lubrificantes e Especialidades, Radar Propriedades Agrícolas and Raízen.

Since 2005, Cosan has been listed on the Novo Mercado segment of São Paulo Exchange (Bovespa), and Cosan Limited (CZZ) has been traded on the New York Stock Exchange (NYSE) since 2007. At the end of the fiscal year closed on March 31, 2013, Cosan registered consolidated net income of R$30 billion, up 28.3% over the previous year.

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