rumo logística operadora multimodal s.a.ri.rumolog.com/ptb/7275/rumo - itr e release 3t15.pdf · 3...

Rumo Logística Operadora Multimodal S.A.

Interim Financial Statements

September 30, 2015

and review report of the independent auditors thereon

(A free translation of the original in Portuguese)


Interim Financial Statements

September 30, 2015

Contents

Independent auditor’s report on review of interim financial

statements 3

Balance sheets 5

Statements of income 8

Statements of comprehensive income 10

Statements of changes in equity 11

Statements of cash flows – indirect method 14

Statements of value added 17

Notes to the interim financial statements 19

3

Independent auditor's report on review of interim financial statements

To the Board of Directors and Shareholders Rumo Logística Operadora Multimodal S.A.

Santos-SP

Introduction

We have reviewed the accompanying individual and consolidated interim financial statements of

Rumo Logística Operadora Multimodal S.A. (“the Company”) in the Quarterly Information Form

– ITR for the quarter ended September 30, 2015, which comprise the balance sheet as at

September 30, 2015 and the related statements of income and other comprehensive income for the

3- and 9-month periods then ended and the changes in equity and cash flows for the 9-month

period then ended, and explanatory notes.

Management is responsible for the preparation and fair presentation of these interim financial

statements in accordance with Technical Pronouncement CPC 21(R1) and IAS 34, ‘Interim

Financial Reporting’ as issued by the International Accounting Standards Board – IASB, as well

as the presentation of the information in accordance with Comissão de Valores Mobiliários

(“CVM”) regulations applicable to the Quarterly Information Form – ITR. Our responsibility is to

express a conclusion on these interim financial statements based on our review.

Scope of Review

We conducted our review in accordance with the Brazilian and International Standard on Review

Engagements 2410, “Review of Interim Financial Information Performed by the Independent

Auditor of the Entity”. A review of interim financial statements consists of making inquiries,

primarily of persons responsible for financial and accounting matters, and applying analytical and

other review procedures. A review is substantially less in scope than an audit conducted in

accordance with auditing standards and consequently does not enable us to obtain assurance that

we would become aware of all significant matters that might be identified in an audit.

Accordingly, we do not express an audit opinion.

Conclusion on the interim financial statements

Based on our review, nothing has come to our attention that causes us to believe that the

accompanying interim financial statements included in the Quarterly Information Form – ITR

referred above were not prepared, in all material respects, in accordance with CPC21 (R1) and

IAS 34 applicable to the preparation of the Quarterly Information Form – ITR and presented in

accordance with the CVM regulations.

4

Other matters

Statement of value added

We have also reviewed the Statements of value added (DVA), individual and consolidated, for

the 9-month period ended September 30, 2015, prepared by Management, whose presentation in

interim financial information is required by CVM regulation applicable to the Quarterly

Information Form – ITR and is considered supplementary information by IFRS, that does not

required the DVA presentation. These statements were subject to the same review procedures

previously described and, based on our review, nothing has come to our attention that causes us to

believe that they were not prepared, in all material respects, consistently with the individual and

consolidated interim financial statements as a whole.

Corresponding figures

The corresponding figures, individual and consolidated, for the balance sheet as at December 31,

2014 were audited by another auditor who issued an unmodified report on March 3, 2015 and the

statements, individual and consolidated, of income and other comprehensive income for the 3-

and 9-month periods ended September 30, 2014 and changes in equity and cash flows for the 9-

month period ended September 30, 2014 were reviewed by another auditor who issued an

unmodified report on November 5, 2014. The corresponding figures related to the statement of

value added (DVA), individual and consolidated, for the 9-month period ended September 30,

2014, were subject to the same review procedures by those auditors and, based on their review,

those auditors issued a report stating that nothing has come to their attention that causes them to

believe that the DVA were not prepared, in all material respects, consistently with the individual

and consolidated interim financial statements as a whole.

Curitiba, November 5, 2015.

KPMG Auditores Independentes

CRC SP-014428/O-6

Original in Portuguese signed by

João Alberto Dias Panceri

Accountant CRC PR048555/O-2

5


Balance sheets

At September 30, 2015 and December 31, 2014 (Amounts in thousands of Brazilian Reais, R$)

Parent Company Consolidated

Note

September

30, 2015

December 31, 2014

September

30, 2015

December 31, 2014

Assets

Current

Cash and cash equivalents 4 19,546 74,826 69,700 85,475

Marketable securities 5 - - 879,027 -

Accounts receivable 6 30,691 40,663 185,610 42,685

Inventories 6,666 5,549 190,880 5,817

Related parties 8 19,666 12,612 24,889 12,692

Current income taxes 4,480 - 22,265 -

Other recoverable taxes 7 9,094 - 234,437 -

Other credits 7,965 11,561 81,315 11,479

98,108 145,211 1,688,123 158,148

Non-current

Accounts receivable 6 - 446,693 22,648 446,693

Restricted cash - - 92,628 - Deferred income tax and social

contribution 14 - - 1,380,332 875

Related parties 8 541,336 - - -

Income taxes - - 223,707 -

Other recoverable taxes 7 - - 528,494 -

Judicial deposits 16 11,172 29,647 345,594 29,671

Derivative financial instruments 27 78,808 - 80,997 -

Other non-current assets 4,217 3,716 187,327 3,749

Equity method investments 9 4,127,710 76,118 45,290 -

Property and equipment 10 1,334,049 958,867 9,122,433 1,084,455

Intangible assets 11 787,407 822,717 7,784,835 860,253

6,884,699 2,337,758 19,814,285 2,425,696

Total Assets 6,982,807 2,482,969 21,502,408 2,583,844

The notes are an integral part of these interim financial statements.

6


Balance sheets

At September 30, 2015 and December 31, 2014 (Amounts in thousands of Brazilian Reais, R$)


Note

September

30, 2015

December

31, 2014 September

30, 2015

December

31, 2014

Liabilities

Current

Current portion of long-term debt 12 181,511 125,893 1,398,905 127,425

Finance leases 17 - - 537,048 -

Real estate credit certificates 19 - - 108,688 -

Derivative financial instruments 27 - - 12,260 -

Accounts payable - suppliers 15 92,918 140,489 745,931 141,289

Salaries payable 28,272 18,346 170,841 19,302

Current income tax and social contribution

payable - 3,020 9,337 2,962

Other taxes payable 13 4,151 6,959 27,758 7,300

Dividends and interest on capital payable - 27,200 8,174 28,003

Leases and concessions 18 - - 19,545 -

Related parties 8 153,444 21,064 85,056 20,292

Deferred income - - 107,252 -

Other current liabilities 31,182 25,430 192,473 26,529

491,478 368,401 3,423,268 373,102

Non-current

Long-term debt 12 2,596,267 636,895 6,912,797 657,284

Finance leases 17 - - 1,286,597 -

Real estate credit certificates 19 - - 197,409 -

Other taxes payable 13 - - 25,501 -

Provision for judicial demands 16 15,525 13,198 561,589 13,378

Leases and concessions 18 - - 2,114,396 -

Deferred income tax and social contribution

14 153,121 169,847 2,720,349 196,598

Deferred income - - 104,526 -

Other current liabilities 118 86 151,139 11,874

2,765,031 820,026 14,074,303 879,134

Equity 20

Common stock 5,451,490 1,099,746 5,451,490 1,099,746

Capital reserve (1,781,811) (137,601) (1,781,811) (137,601)

Profit reserve 59,597 332,397 59,597 332,397

Other equity 3,738 - 3,738 -

Loss for the period (6,716) - (6,716) -

Equity attributable to owners of the

Company 3,726,298 1,294,542 3,726,298 1,294,542

Equity attributable to non-controlling interests

- - 278,539 37,066

Total equity 3,726,298 1,294,542 4,004,837 1,331,608

Total liabilities and equity 6,982,807 2,482,969 21,502,408 2,583,844


7


Statements of income

For the three and nine month periods ended September 30, 2015 and 2014 (In thousands of Brazilian Reais – R$, except earnings per share)

Parent Company

Note

July 1, 2015

to

September

30, 2015

January 1,

2015 to

September

30, 2015

July 1, 2014 to

September

30, 2014

January 1, 2014 to

September

30, 2014

Net revenue from services 23 274,784 625,268 258,166 652,553

Cost of services (182,588) (431,629) (179,999) (429,106)

Gross profit 92,196 193,639 78,167 223,447

Selling, general and administrative (31,799) (77,606) (19,701) (59,914)

Other, net 25 5,099 6,903 782 (988)

Operating expenses (26,700) (70,703) (18,919) (60,902)

Income before financial results, equity

income on investments and income

taxes

65,496 122,936 59,248 162,545

Equity income on investments 9 (33,137) 20,219 496 110

Financial result 24 (82,772) (166,696) (3,053) (23,156)

Income (loss) before income taxes (50,413) (23,541) 56,691 139,499

Income tax and social contribution

(expense) benefit

Current 14 - 99 (16,254) (29,212)

Deferred 14 5,856 16,726 (2,589) (17,698)

5,856 16,825 (18,843) (46,910)

Net income (loss) for the period (44,557) (6,716) 37,848 92,589


8


Statements of income


Consolidated

Note

July 1,

2015 to

September

30, 2015

January 1,

2015 to

September

30, 2015

July 1, 2014

to September

30, 2014

January 1,

2014 to September

30, 2014

Net revenue from services 23 1,357,726 2,783,622 261,300 659,715

Cost of services (921,415) (1,833,763) (180,666) (432,766)

Gross profit 436,311 949,859 80,634 226,949


Other, net 25 11,202 50,572 1,017 (464)

Operating expenses (84,023) (152,858) (19,878) (64,096)

Income before financial results, equity

income on investments and income taxes 352,288 797,001 60,756 162,853

Equity income on associates 9 4,074 4,255 - -

Financial result 24 (399,401) (750,625) (3,061) (23,110)

Income (loss) before income taxes (43,039) 50,631 57,695 139,743

Income tax and social contribution

(expense) benefit

Current 14 (16,196) (26,920) (16,254) (29,211)

Deferred 14 18,112 (20,116) (3,117) (17,837)

1,916 (47,036) (19,371) (47,048)

Net income (loss) from continued

operations (41,123) 3,595 38,324 92,695

Net loss from discontinued operations 26 (2,624) (6,206) - -


Net income (loss) attributable to:

Non-controlling interests 810 4,105 476 106

Owners of the Company 21 (44,557) (6,716) 37,848 92,589

Earnings per share: 21

Basic (0.149) (0.029) 0.369 0.902

Diluted (0.158) (0.032) 0.369 0.902


9


Statements of comprehensive income


Parent Company

July 1, 2015

to

September

30, 2015

January 1,

2015 to

September

30, 2015

July 1, 2014 to

September

30, 2014

January 1, 2014 to

September 30,

2014


Currency translation adjustment (750) 3,738 - -

Total comprehensive income (loss) (45,307) (2,978) 37,848 92,589

Consolidated

July 1, 2015

to

September

30, 2015

January 1,

2015 to

September

30, 2015

July 1, 2014

to September

30, 2014

January 1,

2014 to September 30,

2014


Currency translation adjustment (752) 3,717 - -

Total comprehensive income (loss) (44,499) 1,106 38,324 92,695

Attributable to:

Non-controlling interests 808 4,084 476 106

Owners of the Company (45,307) (2,978) 37,848 92,589

(44,499) 1,106 38,324 92,695


10


Statements of changes in equity

For the nine month periods ended September 30, 2015 and 2014

(Amounts in thousands of Brazilian Reais, R$)

Attributable to shareholders of Company

Profit reserve

Common

stock

Capital

reserve Legal

Retained

earnings

Profit for the

period Total

Non-

controlling

interest Total equity

Balance at January 1, 2014 1,099,746

(137,601) 24,486 372,250 - 1,358,881 37,013 1,395,894

Income for the period - - - - 92,589 92,589 106 92,695

Total comprehensive income for the

period - - - - 92,589 92,589 106 92,695

Reserve from write-off of dividends - - - 98,334 - 98,334 - 98,334

Interim dividends - - - (250,000) - (250,000) 65 (249,935)

Total contributions or distributions

to shareholders, recognized directly

in equity - - - (151,666) - (151,666) 65 (151,601)

Balance at September 30, 2014 1,099,746 (137,601) 24,486 220,584 92,589 1,299,804 37,184 1,336,988


11


Statements of changes in equity

For the nine month periods ended September 30, 2015 and 2014

(Amounts in thousands of Brazilian Reais, R$)

Attributable to shareholders of Company

Profit reserve

Common

stock

Capital

reserve Legal

Retained

earnings

Loss for the

period Other equity Total

Non-

controlling

interest Total equity

Balance at January 1,

2015 1,099,746 (137,601) 30,212 302,185 - - 1,294,542 37,066 1,331,608

Loss for the period - - - - (6,716) - (6,716) 4,105 (2,611)

Currency translation

adjustment - - - - - 3,738 3,738 (21) 3,717

Total comprehensive

income for the period - - - - (6,716) 3,738 (2,978) 4,084 1,106

Capital increase (ALL

acquisition) 4,351,744 (1,644,210) - - - - 2,707,534 240,900 2,948,434

Dividends (Note 20 c) - - - (272,800) - - (272,800) (3,511) (276,311)

Total contributions or

distributions to

shareholders,

recognized directly in

equity 4,351,744 (1,644,210) - (272,800) - - 2,434,734 237,389 2,672,123

Balance at September

30, 2015 5,451,490 (1,781,811) 30,212 29,385 (6,716) 3,738 3,726,298 278,539 4,004,837


12


Statements of cash flows

For the nine month periods ended September 30, 2015 and 2014 (Amounts in thousands of Brazilian Reais, R$)

Parent Company

January 1,

2015 to

September 30,

2015

January 1, 2014 to

September 30,

2014

Cash flows from operating activities

Income before income taxes (23,541) 139,499 Adjustments to reconcile income before income tax and social contribution to cash

flows from operating activities:

Depreciation and amortization 83,529 67,380

Equity pick-up of investees / associates (20,219) (110)

Provision for profit sharing 14,415 6,431

Income on disposal of fixed assets and intangible 526 1

Provision for losses on judicial demands 2,133 961

Reversal for losses on doubtful accounts - (702)

Interest, indexation charges and exchange variations, net 164,729 29,403

221,572 242,863

Changes in: Accounts receivable (57,069) (150,504) Advances from customers (4,751) 726 Judicial deposits 19,000 (20,720)

Related parties (41,516) 12,841

Other recoverable taxes (13,506) 3,453 Taxes payable (5,829) (42,322) Inventories (1,117) (870)

Salaries payable (4,489) (2,743)

Accounts payable 73,490 32,914 Deferred income (2,337) (104) Provision for judicial demands (1,106) (900)

Other asset and liabilities, net 10,143 (22,579)

Net cash from operating activities 192,485 52,055

Cash flows from investing activities

Purchase of property and equipment, software and intangible assets (400,319) (175,609)

Capital increase in subsidiary (1,320,111) -

Net cash used in investing activities (1,720,430) (175,609)

Cash flow from financing activities

Proceeds from debt 1,950,847 77,593

Repayments of principal (92,973) (76,029)

Payments of interest (92,936) (30,562)

Derivative financial instruments 7,727 -

Dividends paid (300,000) (250,000)

Net cash from (used in) financing activities 1,472,665 (278,998)

Decrease in cash and cash equivalents (55,280) (402,552)

Cash and cash equivalents at beginning of year 74,826 496,943

Cash and cash equivalents at end of the period 19,546 94,391

Supplemental disclosure of cash flow information

Income taxes paid 2,241 28,634


13


Statements of cash flows


Consolidated

January 1,

2015 to

September

30, 2015

January 1, 2014 to

September 30,

2014

Cash flow from operating activities

Income before income taxes 50,631 139,743 Adjustments to reconcile net income before income tax and social contribution to cash flows

from operating activities:


Equity pick-up of investees / associates (4,255) -


Income on disposal of fixed assets and intangible 3,463 1

Provision for losses on judicial demands 4,801 971

Provision (reversal) for losses on doubtful accounts 386 (702)

Other 52,102 - Interest, indexation charges and exchange variations, net 767,889 29,810

1,318,881 246,832

Changes in: Accounts receivable (39,676) (150,804) Advances from customers (13,745) (89)

Judicial deposits (2,687) (20,736)

Related parties 14,029 11,349 Other recoverable taxes 656 3,428 Taxes payable (43,309) (42,614)

Inventories (81,068) (862)

Salaries payable 7,817 (2,785) Accounts payable 54,568 31,908 Deferred income (34,116) (80)

Judicial demands (13,855) (892)

Other asset and liabilities, net (68,948) (22,261)

Net cash from operating activities 1,098,547 52,394

Cash flow from investing activities

Purchase of property, plant and equipment, software and intangible assets (890,184) (183,280)

Marketable securities (161,405) -

Restricted cash 130,440 -

Net cash acquired in business acquisition 169,703 -

Net cash used in investing activities (751,446) (183,280)


Proceeds from debt 2,537,908 87,576

Repayments of principal (2,053,608) (76,840)


Derivative financial instruments 7,727 -

Dividends paid (301,500) (250,000)

Net cash used in financing activities (362,876) (270,103)







14


Statements of value added


Parent Company

January 1,

2015 to

September 30,

2015

January 1,

2014 to

September 30, 2014

Revenue

Sale of services 671,800 712,809

Other operating revenue 16,122 11,237

Allowance for doubtful accounts - 702

687,922 724,748

Raw materials acquired from third parties

Cost of services rendered (241,867) (256,298)

Materials, energy, third party services, other (97,217) (83,317)

(339,084) (339,615)

Gross value added 348,838 385,133

Retention

Depreciation and amortization (83,529) (67,380)

Net value added 265,309 317,753

Value added transferred in

Equity pick-up in investees 20,219 110

Financial income 6,788 28,379

27,007 28,489

Value added to be distributed 292,316 346,242

Distribution of value added

Personnel 71,733 57,551

Direct remuneration 55,265 42,950

Benefits 13,099 11,845

FGTS 3,369 2,756

Taxes and contributions 41,381 134,310

Federal 28,164 96,942

State 7,010 14,909

City 6,207 22,459

Third party capital remuneration 185,918 61,792

Interest 173,484 51,535

Leasing 12,434 10,257

Equity capital remuneration (6,716) 92,589

Retained earnings (6,716) 92,589

292,316 346,242


15


Statements of value added


Consolidated

January 1, 2015

to September

30, 2015

January 1, 2014

to September

30, 2014

Revenue

Sale of services 3,032,180 721,069

Other operating revenue 493,690 11,237

Allowance for doubtful accounts (386) 702

3,525,484 733,008

Raw materials acquired from third parties

Cost of services rendered (804,967) (249,812)

Materials, energy, third party services, others (297,158) (87,051)

Loss / recovery of assets (274,802) -

Other (198,984) -

(1,575,911) (336,863)

Gross value added 1,949,573 396,145

Retention

Depreciation and amortization (398,871) (70,378)

Net value added 1,550,702 325,767

Value added received in transfer

Equity pick-up in associates 4,255 -

Financial income 97,673 28,602

101,928 28,602

Value added to be distributed 1,652,630 354,369

Distribution of value added

Personnel 305,842 61,894

Direct remuneration 273,345 46,036

Benefits 17,366 12,822

FGTS 15,131 3,036

Taxes and contributions 291,800 136,567

Federal 243,383 98,618

State 38,769 14,908

City 9,648 23,041

Third party capital remuneration 1,057,599 63,213

Interest 848,298 51,712

Leasing 209,301 11,501

Equity capital remuneration (2,611) 92,695

Non-controlling interests 4,105 106

Retained earnings (6,716) 92,589

1,652,630 354,369



Notes to the interim financial statements

September 30, 2015 and 2014 (In thousands of Brazilian Reais – R$, unless otherwise stated)

16

1. Operations

Rumo Logística Operadora Multimodal S.A. ("The Company" or "Rumo"), is a publicly traded

company with its shares traded on the São Paulo stock exchange (“BM&FBOVESPA) under

the ticker RUMO3, and has its headquarters in the city of Santos, State of São Paulo, Brazil. The

Company is a direct subsidiary of Cosan Logística S.A. ("Cosan Logística") which owns 26.26%

of its capital, and its Parent Company is Cosan Ltd. ("CZZ"). On April 1, 2015 the Company

acquired full control over the capital of ALL - América Latina Logística S.A. ("ALL").

The Company is a service provider in the logistics sector (transport and elevation), principally for

export commodities, providing an integrated transport solution, handling, storage and shipment

from the production centers to the main southern and southeast ports, and also holds interests in

other companies, ventures and consortia related to infrastructure.

The Company also operates in the rail transportation segment in Southern Brazil through its

subsidiary ALL - América Latina Logística Malha Sul S.A. ("ALL Malha Sul"), and the Central

West region and State of São Paulo through subsidiaries ALL - América Latina Logística Malha

Paulista S.A. ("ALL Malha Paulista"), ALL - America Latina Logística Malha Norte S.A. ("ALL

Malha Norte") and ALL - América Latina Logística Malha Oeste S.A. ("ALL Malha Oeste"). In

addition, the subsidiary Brado Logística e Participações S.A. ("Brado") operates in the container

segment.

Additionally, the Company has terminals for transshipment and terminals for export of sugar and

grains at the Port of Santos.

On September 30, 2015, the Company had a negative consolidated working capital of R$

1,735,145. On the other hand, it generated consolidated operating cash flows of R$ 1,098,547 and

made investments in modernizing its rolling stock and improving the railway network in the

amount of R$ 890,184, in line with its business plan. Management has been working on measures

that will enable the Company to present a balanced structure of debt, in order to fully meet its

business plan. Thus, management believes the use of the going concern assumption in the

preparation of these interim financial statements is appropriate.

a) ALL Acquisition

On May 8, 2014, the shareholders approved at the Extraordinary General Meeting the

acquisition of ALL’s shares by the Company, effectively suspended until obtaining the approval

of the Merger of Shares by Conselho Administrativo de Defesa Econômica ("CADE"), by

Agência Nacional de Transportes Terrestres ("ANTT") as well as from any other public

administration bodies from which prior authorizations are necessary and verification (or waiver

by the applicable part) of any other conditions precedent set forth in the proposal sent by the

Company to ALL on 24 February, 2014, to the effectiveness of the acquisition.




17

On February 11, 2015, in response to the provisions of article 2 of CVM Instruction 358/2002,

the Company announced the unanimous approval by CADE, pursuant to art. 61 of Law No.

12,529 / 2011, the concentration acts on the merger of ALL shares issued by the Company upon

the conclusion of an Agreement in concentration control ("ACC").

As required by ACC, the new company started to adopt certain behaviors aimed to eliminate the

competition concerns identified in the opinion of the General Superintendence of the CADE.

These behavioral obligations remain in force for a period of seven (7) years (from the publication

of its approval in the Diário Oficial da União) and are meant primarily to ensure isonomic

attendance by the users of railway services charges, primarily through strengthening the

governance rules, the adoption of transparent mechanisms in pricing parameters, service

attendance control and limitation of the use of rail transport by related parties.

On March 19, 2015 Agência Nacional de Transportes Aquaviários ("ANTAQ") approved the

change of control, which was the last condition precedent to the effectiveness of the merger.

On March 23, 2015 ALL's Board of Directors approved the merger, and from April 1, 2015, the

Company's shares, already reflecting the effects of the Share Exchange, began trading on the

BM&FBOVESPA. As a result of this process the ALL's shares (Bovespa: ALLL3) ceased to be

traded on the BM&FBOVESPA on March 31, 2015. As a result, on April 1, 2015, ALL has

become a wholly owned subsidiary of the Company.

The accounting effects of the acquisition of ALL are presented in note 3 and the financial position

and consolidated results of operations for the periods subsequent to the acquisition are not

necessarily comparable with information presented in prior periods.

b) The concession of railway operation and port terminal

The Company holds, through subsidiaries or affiliates, concessions of railway services and port

terminals, whose scope and completion are as follows:

Companies Concession end Coverage area

Subsidiaries

Terminais Portuários Rumo e Teaçú December 2036 Port of Santos-SP

ALL Malha Sul February 2027 Southern Brazil and Sao Paulo State

ALL Malha Paulista December 2028 Sao Paulo State

ALL Malha Oeste June 2026 Midwest and State of São Paulo

ALL Malha Norte May 2079 Midwest and State of São Paulo

Portofer June 2025 Port of Santos-SP

Associates

Terminal XXXIX October 2025 Port of Santos-SP

TGG - Terminal de Granéis do Guarujá August 2027 Port of Santos-SP

Termag - Terminal Marítimo de Guarujá August 2027 Port of Santos-SP




18

The subsidiaries and associates above are subject to compliance with certain conditions set out in

the privatization bids and the concession contracts for railway networks and port terminals.

The concession agreements of these subsidiaries and associates shall be terminated by: expiration

of the contractual term; expropriation; forfeiture; termination; annulment and bankruptcy; or

termination of the dealership.

In the event of the termination of any of the concessions, the main effects would be as follows:

Return to the government all the rights and privileges transferred to the subsidiaries,

together with leased assets and those resulting from investments that are considered

reversible by the Federal Government as being necessary to the continuous provision of

the granted service.

The reversible assets would be indemnified by the Federal Government at the residual

cost, calculated based on the accounting records of the subsidiaries, considering

depreciation; such costs would be subject to technical and financial analysis by the

Federal Government. Any and all improvements made to the permanent track

superstructure would not be considered as investments for indemnification purposes.

c) Liquidity rights exercised at Brado

On June 3, 2015 the Company, through its direct subsidiary ALL, informed that Brado’s non-

controlling shareholders exercised their liquidity right provided in the shareholders’ agreement,

which enables the exit of Brado’s original shareholders via a share exchange. As a result, the

Company and the Brado’s original shareholders prepared appraisal reports, based on the

economic value of the companies, to establish an exchange ratio, which has not yet been

concluded.

2. Presentation of interim financial statements and significant accounting policies

2.1. Basis of preparation

The interim financial statements have been prepared in accordance with CPC 21 (R1) and IAS 34

- Interim Financial Reporting issued by the International Accounting Standards Board (IASB),

and presented in accordance with the standards issued by the Brazilian Securities and Exchange

Commission (CVM) applicable to the Quarterly Information (ITR) and do not include all of the

information required in complete, annual financial statements.

These interim financial statements were prepared following the basis of preparation and

accounting policies consistent with those adopted in preparing the financial statements as of

December 31, 2014 and should be read together. New applicable accounting policies due to the

acquisition of ALL are described below. The notes that have not changed significantly or had

irrelevant changes compared to December 31, 2014 were not repeated in full in these interim

financial statements.




19

However, selected information has been included to explain the main events and transactions that

occurred to enable the understanding of changes in financial position and performance of

operations since the issuance of the annual financial statements for the year ended December 31,

2014.

In preparing these interim financial statements, management used judgments, estimates and

assumptions that affect the application of the Company's accounting policies and the reported

amounts of assets, liabilities, income and expenses. Actual results may differ from these

estimates. Estimates and assumptions are reviewed on an ongoing basis and have not changed in

relation to the financial statements of December 31, 2014.

The presentation of the Statement of Value Added (“DVA”) is required by Brazilian corporate

law and the accounting practices adopted in Brazil applicable to publicly traded companies. IFRS

does not require the presentation of such statement. As a result, under IFRS, such statement is

presented as supplementary information.

On November 5, 2015, the Company’s management approved and authorized the issuance of

these interim financial statements.

Presentation of segment information

Operating segment information is presented consistently with the internal reporting provided to

the chief operating decision maker. The chief operating decision maker, responsible for allocating

resources and assessing performance of the operating segments is the Executive Board, also

responsible for making the strategic decisions of the Company and its subsidiaries.

With the acquisition of ALL, management initiated an internal restructuring that led to the

creation of two vice-presidencies, the first focused on South operations (comprised of railway and

transshipment in the concession area of ALL Malha Sul and ALL Malha Oeste) and the second

focused on the North Operations (composed by railway operations, transshipment and port

elevation in the areas of the Company's concession, ALL Malha Norte and ALL Malha Paulista).

A third segment includes Brado, the Company's indirect subsidiary focused on container

operations and the container operations of other group companies. Therefore, the Company now

discloses three segments: (i) North Operations, (ii) South Operations, and (iii) Container

Operations.




20

2.2. Basis of consolidation

The consolidated interim financial statements include the financial statements of the Company

and its subsidiaries, listed below:

Directly and indirectly controlled

September 30, 2015 December 31, 2014

Subsidiaries

Direct

Logispot Armazéns Gerais S.A. 51.00% 51.00%

Rumo Um S.A. - 100.00%

Rumo Dois S.A. - 100.00%

ALL – América Latina Logística S.A. 100.00% -

Indirect

ALL Intermodal S.A. 100.00% - ALL Malha Oeste S.A. 100.00% - ALL Malha Paulista S.A. 100.00% - ALL Malha Sul S.A. 100.00% - ALL Malha Norte S.A. 99.24% - ALL Participações S.A. 100.00% - ALL Armazéns Gerais Ltda. 100.00% - Portofer Ltda. 100.00% - Boswells S.A. 100.00% - Brado Holding S.A. 100.00% - Brado Logística e Participações S.A. 62.22% - Brado Logística S.A. 62.22% - Tezza Consultoria de Negócios Ltda. 99.99% - ALL Equipamentos Ltda. 99.99% - ALL Argentina S.A. 90.96% - ALL Mesopotâmica S.A. 70.56% -

ALL Central S.A. 73.55% -

Paranaguá S.A. 99.83% - ALL Rail Management Ltda. 50.01% - PGT S.A. 100.00% -

Associates (Equity)

Rhall Terminais Ltda. 30.00% -

Termag S.A. 19.85% -

TGG S.A. 9.92% -

Terminal XXXIX S.A. 49.62% -

2.3. Hedge

The Company entered into bilateral loans denominated in US Dollars through Resolution

4,131/62 denominated in US$ equivalent to R$ 409,271. The currency exposure in US$ of these

operations was protected with SWAP transactions exchanging indexes and eliminating the risk of

currency fluctuations. The fair value changes of the contracted derivative are recognized through

profit or loss.




21

The Company has designated these loan agreements as liabilities measured at fair value through

profit or loss in order to eliminate or at least significantly reduce the measurement inconsistency

that would otherwise arise from measurement and recognition of gains and losses on loans and

derivatives on different bases. As a result, the fair value fluctuations on these loans are recognized

through profit or loss.

2.4. Business combination

Business combinations are recognized using the acquisition method. The transferred

consideration for the acquisition is generally measured at fair value, as well as the identifiable net

assets acquired and liabilities assumed. Any resulting goodwill is tested annually for impairment.

Transaction costs are charged to income as incurred, except costs related to the issuance of debt

instruments or equity.

The consideration transferred does not include amounts related to pre-existing relationships

payments. These amounts are generally recognized in the income statement.

2.5. Non-current assets held for sale and discontinued operations

The Company classifies non-current assets as held for sale if their carrying amounts are

recoverable mainly through sale rather than through continued use. Non-current assets classified

as held for sale are measured at the lower of their carrying amount and fair value less selling

costs.

Classification criteria as held for sale are considered met only when the sale is highly probable

and the asset is available for immediate sale. Management must be committed to the completion

of the sale within one year from the date of classification.

Discontinued operations are excluded from the results from continuing operations and are

presented as a single line item in the income statement.

Additional disclosures are presented in note 26. All other notes to the financial statements include

amounts for continuing operations, unless otherwise stated.

2.6. Deferred income

Substantially comprised of amounts received from clients for investment in fixed assets in return

of a rail service contract requiring future performance of services by the Company.

2.7. New standards and interpretations not yet adopted

The following new standards and interpretations were issued by the IASB but are not effective for

the year 2015. Early adoption of standards, although encouraged by the IASB, is not permitted in

Brazil by the Brazilian Accounting Pronouncements Committee (CPC), which has not yet issued

its version of these standards.




22

IFRS 9 - "Financial instruments" addresses the classification, measurement and recognition of

financial assets and liabilities. The full version of IFRS 9 was published in July 2014, effective as

of January 1, 2018. Management is evaluating the full impact of its adoption.

IFRS 15 - "Contract Revenue from Customers" - This new standard provides the principles that

an entity applies to determine the measurement of revenue and when it is recognized. It is

effective on January 1, 2018 and supersedes IAS 11 - "Construction Contracts", IAS 18 -

"Income" and their related interpretations. Management is evaluating the impact of its adoption.

There are no other IFRS or IFRIC interpretations that are not yet effective and that are expected

to have a significant impact on the Company.

2.8. Cash flow – non cash transactions

During the nine-month period ended September 30, 2015, the Company made the following non

cash transactions that are not reflected in the statement of consolidated cash flows:

Acquisition of net assets of ALL in the amount of R$ 2,567,669 through the issuance of

equity instruments, except for the cash acquired in the transaction of R$ 169,703 (Note

3).

Finance lease of locomotives and rail cars in the amount of R$ 262,759.




23

3. Business combination

As described in note 1, on April 1, 2015, after the necessary approvals of the competent bodies,

the Company acquired 100% of the common shares of ALL and through the shareholders'

agreement, obtained its control and consolidated its results.

The acquisition took place by an exchange of shares, with the issuance by the Company of

1,963,670,770 registered common shares with no par value, representing 65.67% of its equity in

exchange for 100% of the share capital of ALL, represented by 681,995,165 common shares.

As a result of the acquisition, the Company consolidates its participation strategy in the logistics

and infrastructure business in Brazil, by adding approximately 12,000 km of existing rail tracks in

ALL concessions.

a) Consideration transferred

As a basis for measuring the fair value of the consideration transferred, the share price of ALL

("ALLL3") on the BM&FBOVESPA at the close of business on March 31, 2015 was used, at the

price of R$ 3.97 per share. Additionally, the value was adjusted for the settlement of pre-existing

relationship, as follows:

Acquired common shares (681,995,165) at R$ 3.97 2,707,534

Pre-existing relationship settlement 29,838

Total consideration transferred 2,737,372

Settlement of pre-existing relationship

In March 2009, the Company and ALL signed an operating agreement (pre-existing relationship)

for the supply of sugar and other grains transportation logistics from the western state of São

Paulo to the Port of Santos, in which the Company has port concessions for elevation services.

According to the terms of the existing agreement, the Company invested in the construction and

improvement of permanent tracks under concession of ALL and acquired rolling stock for use in

the transport of products in ALL’s rail network, in order to increase ALL’s rail freight transport

capacity. In exchange for the Company's investments, the agreement stipulated that ALL would

provide a certain capacity of rail transport services, as well as compensate the Company through

the payment of a contractually fixed fee per ton of product transported by ALL using the rail

network and / or by the use of the rolling stock provided by the Company to ALL.

This preexisting relationship was settled when the Company acquired ALL. The Company

recognized a gain of R$ 29,838 as a result of this settlement and this amount was recognized in

the income statement as "other operating income".




24

The fair value measurement of the pre-existing relationship was based on the difference between

the value of the investment made by the Company and the discounted cash flow return on this

investment, considering the contractually agreed volume and rate.

b) Identifiable assets acquired and liabilities assumed

The preliminary fair value of assets acquired and liabilities assumed is as follows: Fair value of identifiable assets acquired and liabilities assumed

Cash and cash equivalents 169,703

Marketable securities 940,689

Accounts receivable 385,367

Inventories 84,326

Other assets 1,617,232

Property and plant 7,225,047

Intangible assets 7,500,080

Loans and financing (3,782,919)

Debentures (2,856,304)

Finance lease (1,857,947)

Real estate credit certificates (340,255)

Suppliers payable (890,153)

Lease and concession (1,974,280)

Provision for judicial demands (553,094)

Other liabilities (1,563,425)

Deferred income and social contribution taxes (1,125,795)

Non-controlling interest (240,900)

Total net identifiable assets 2,737,372

Measurement of fair values

In measuring fair values management used valuation techniques considering market prices for

similar items, replacement costs, discounted cash flow, among others.

Since this is a preliminary measure of fair value, if new information obtained within one year

from the date of purchase, on facts and circumstances that existed at the acquisition date, indicate

adjustments to the amounts mentioned above, or any additional liability that existed at the

acquisition date, the purchase price allocation will be revised.

The Company has elected to measure the non-controlling interest on Brado – indirect subsidiary

controlled by ALL - based on the proportionate interest in the recognized amount of fair value of

identifiable net assets of Brado.

Accounts receivable fair value of R$ 385,367 is net of an allowance of R$ 51,495.




25

The acquisition-related costs were recorded in "other operating expenses" in the income statement

in the amount of R$ 5,295.

The consolidated income statement includes, from the acquisition date - April 1, 2015, revenue

and profit of R$ 2,277,132 and R$ 21,021, respectively, generated by ALL and its subsidiaries.

If ALL had been consolidated from January 1, 2015, the consolidated income statement for the 9

month period ended September 30, 2015 would present revenue of R$ 3,548,149 and a loss of R$

237,536.

4. Cash and cash equivalent


September

30, 2015

December

31, 2014

September

30, 2015

December

31, 2014

Cash and bank accounts 12,528 5,857 19,175 6,097

Financial investments (i) 7,018 68,969 50,525 79,378

19,546 74,826 69,700 85,475

(i) The financial investments were as below:


September

30, 2015

December

31, 2014

September

30, 2015

December

31, 2014

Exclusive funds

Repurchase transactions 3,773 54,674 3,773 63,298

Bank deposit certificates - CDBs 3,245 11,314 31,305 13,099

7,018 65,988 35,078 76,397

Bank investments

Bank deposit certificates - CDBs - - 10,801 -

Repurchase transactions - 2,981 4,646 2,981

- 2,981 15,447 2,981

7,018 68,969 50,525 79,378




26

5. Marketable securities

Consolidated

September 30,

2015

December 31,

2014

Current assets

CDB investments linked to BNDES loans 196,059 -

Government bonds 682,968 -

879,027 -

6. Accounts receivable


September 30,

2015

December 31,

2014

September 30,

2015

December 31,

2014

Domestic and foreign 31,806 509,421 238,023 511,500

Allowance for doubtful

accounts (1,115) (22,065) (29,765) (22,122)

30,691 487,356 208,258 489,378

Current 30,691 40,663 185,610 42,685

Non-current - 446,693 22,648 446,693

The reduction in the consolidated balance refers mainly to the elimination of accounts receivable from ALL due to its

consolidation with the acquisition of control on April 1, 2015. Regarding the Parent Company, balances receivable

from ALL were reclassified to related parties.

7. Other recoverable taxes Parent Company Consolidated

September

30, 2015

December

31, 2014

September

30, 2015

December

31, 2014

Contribution to social security financing

(“COFINS”) 7,469 - 238,383 -

Social integration program (“PIS”) 1,625 - 71,303 -

Tax on circulation of goods, transport services

and communication (“ICMS”) (i) - - 217,062 -

ICMS - CIAP (ii) - - 222,569 -

Other - - 13,614 -

9,094 - 762,931 -

Current 9,094 - 234,437 -

Non-current - - 528,494 -

(i) ICMS credit on the acquisition of inputs and diesel used in transport services.

(ii) ICMS credit arising from acquisitions of fixed assets.




27

8. Related parties

a) Summary of the main balances and transactions with related parties


September

30, 2015

December

31, 2014

September

30, 2015

December

31, 2014

Current assets

Commercial operations

Cosan S.A. Indústria e Comércio 1,554 1,486 1,632 1,564

Raízen Energia S.A. and subsidiaries 17,856 9,921 18,963 9,947

Raízen Combustíveis S.A. 197 - 4,255 -

Other 59 228 39 204

19,666 11,635 24,889 11,715

Corporate operations / agreements

Other - 977 - 977

- 977 - 977

19,666 12,612 24,889 12,692


September

30, 2015

December

31, 2014 September

30, 2015

December

31, 2014

Non-current assets


ALL - América Latina Logística S.A. (i) 541,336 - - -

541,336 - - -

541,336 - - -

(i) The balance receivable on September 30, 2015 from ALL refers mainly to leased rolling stock.




28


September

30, 2015

December

31, 2014

September

30, 2015

December

31, 2014

Current liabilities


Cosan S.A. Indústria e Comércio 5,049 3,342 5,049 3,342

ALL - América Latina Logística S.A. (i) 134,791 - - -

Raízen Energia S.A. and subsidiaries 12,116 16,441 12,406 16,542

Cosan Lubrificantes e Especialidades S.A. 377 363 4,983 363

Raízen Combustíveis S.A. (ii) 1 - 62,618 -

Logispot Armazéns Gerais S.A. 1,110 - - -

Other - 918 - 45

153,444 21,064 85,056 20,292

(i) The balance payable on September 30, 2015 to ALL refers to rail transport services provided.

(ii) The balance payable on September 30, 2015 to Raízen Combustíveis refers to purchases of fuel.

b) Summary of transactions with related parties

Parent Company

July 1, 2015

to

September

30, 2015

January 1,

2015 to

September

30, 2015

July 1,

2014 to

September

30, 2014

January 1,

2014 to

September

30, 2014

Services

Raízen Energia S.A. and subsidiaries (i) 98,094 224,140 75,037 208,899

ALL - América Latina Logística S.A. 67,441 110,578 - -

Other - - 315 1,387

165,535 334,718 75,352 210,286

Shared expenses

Cosan S.A. Indústria e Comércio (3,908) (6,621) (2,440) (7,221)

Raízen Energia S.A. (1,229) (3,571) (1,090) (3,869)

(5,137) (10,192) (3,530) (11,090)

Purchases

Raízen Combustíveis S.A. - (12) (11) (729)

Logispot Armazéns Gerais S.A. (1,572) (6,444) (4,861) (10,650)

ALL - América Latina Logística S.A. (59,342) (63,318) - -

Brado Logística S.A - (14,682) - -

Cosan Cayman Finance Lim (3) (3) - -

Cosan Lubrificantes e Especialidades (51) (154) - -

(60,968) (84,613) (4,872) (11,379)

Financial result

Rezende Barbosa S.A. Administração e

Participações - 10 85 378

Other - (9) 15 15

- 1 100 393

(i) The balances in the three- and nine-month periods ended September 30, 2015 with Raizen Energia and its

subsidiaries refer mainly to transport storage and port elevation services.




29

Consolidated

July 1, 2015

to

September

30, 2015

January 1,

2015 to

September

30, 2015

July 1,

2014 to

September

30, 2014

January 1,

2014 to

September

30, 2014

Services

Raízen Energia S.A. and subsidiaries (i) 99,658 229,998 77,617 211,478

Raízen Combustíveis S.A. (ii) 28,155 55,518 - -

Other - - 315 1,387

127,813 285,516 77,932 212,865

Shared expenses

Cosan S.A. Indústria e Comércio (3,908) (6,621) (2,440) (7,221)

Raízen Energia S.A. (2,313) (4,857) (1,189) (4,190)

(6,221) (11,478) (3,629) (11,411)

Purchases

Raízen Combustíveis S.A. (iii) (200,570) (202,334) (11) (729)

Cosan Cayman Finance Lim (3) (3) - -

Cosan Lubrificantes e Especialidades (11,793) (20,546) - -

(212,366) (222,883) (11) (729)

Financial result

Rezende Barbosa S.A. Administração e

Participações - 10 85 378

Raízen Energia S.A. (9) (9) - -

Outros - - 15 15

(9) 1 100 393

(i) The balances in the three- and nine-month periods ended September 30, 2015 with Raizen Energia and its

subsidiaries refer mainly to transport, storage and port elevation services.

(ii) The balances in the three-and nine-month periods ended September 30, 2015 with Raizen Combustíveis refer

to fuel transportation services.

(iii) The balances in the three- and nine-month periods ended September 30, 2015 with Raizen Combustíveis

refer to acquisition of fuel.

Officers and directors remuneration

Fixed and variable remuneration of the statutory officers, board of directors and fiscal board

amounts to R$ 5,546 during the nine-month period ended September 30, 2015 (2014: R$ 2,282),

and the entire amount is classified as short-term benefits.




30

9. Equity method investments (Parent Company)

Direct

subsidiaries

Total

shares of

the investee

Shares held

by the

Company

Percentage

of interest

(%)

Balance at

December

31, 2014

Equity

pick-up

Business

Combination

Capital

increase

Comprehensive

income Other

Balance at

September

30, 2015

Logispot

Armazéns

Gerais S.A.

("Logispot") 2,040,816 1,040,816 51% 76,108 (650) - - - - 75,458

ALL 681,995,165 681,995,165 100% - 20,869 2,707,534 1,320,111 3,738 - 4,052,252

Rumo Um

S.A. - - - 5 - - - - (5) -

Rumo Dois

S.A. - - - 5 - - - - (5) -

76,118 20,219 2,707,534 1,320,111 3,738 (10) 4,127,710

(Consolidated)

Indirect associates

Total

shares of

the

investee

Shares

held by

the

Company

Percentage

of interest

(%)

Balance at

December

31, 2014

Equity

pick-

up

Business

combination Other

Balance at

September

30, 2015

Rhall Terminais 28,580 8,574 30.00% - 122 3,492 - 3,614

Termag S.A. 500,000 99,246 19.85% - (1,732) 6,175 - 4,443

TGG S.A. 79,747,000 7,914,609 9.92% - 3,256 16,275 - 19,531

Terminal XXXIX 200,000 99,246 49.62% - 2,609 15,343 (250) 17,702

- 4,255 41,285 (250) 45,290




31

Information of the associates:

RHALL

TERMINAIS

LTDA.

TERMINAL

XXXIX

TERMAG S/A TGG S/A

September 30,

2015

September 30,

2015

September 30,

2015

September 30,

2015

Current

Assets 6,735 17,050 26,290 61,296

Liabilities 662 6,450 15,526 50,634

Net current assets 6,073 10,600 10,764 10,662

Non-current

Assets 6,736 31,576 154,901 195,951

Liabilities 762 6,772 143,448 11,307

Net non-current assets 5,974 24,804 11,453 184,644

Equity 12,047 35,404 22,217 195,306

Result for the period 371 6,013 (2,250) 38,091




32

10. Property and equipment

September 30, 2015 December 31, 2014

Useful life in

years Cost

Accumulated

Depreciation Net Net

Improvements / Overhauls on concession

assets

Locomotives 1 - 23 679,252 (26,808) 652,444 -

Freight cars 1 - 27 42,462 (19,131) 23,331 -

Track structure 2 - 23 1,468,861 (35,743) 1,433,118 -

Other 10 - 15 107,217 (4,413) 102,804 -

2,297,792 (86,095) 2,211,697 -

Own fixed assets in operation

Track structure 2 - 97 1,763,293 (67,644) 1,695,649 -

Freight cars 1 - 35 582,591 (22,571) 560,020 245,544

Locomotives 1 - 30 776,871 (53,276) 723,595 218,762

Buildings and Improvements 10 - 25 412,845 (79,669) 333,176 216,908

Machinery equipment installations 4 - 10 504,508 (166,857) 337,651 242,986

Land and rural properties 110,112 - 110,112 58,612

Replacement parts 70,211 - 70,211 -

Furniture and fixtures and computer

equipment 4 - 10 20,577 (6,070) 14,507 2,481 Frequent replacement of parts and

components 23,243 (3,992) 19,251 -

Other 5 - 10 241,170 (14,161) 227,009 99,162

4,505,421 (414,240) 4,091,181 1,084,455

Leases

Locomotives 10 - 25 829,375 (14,115) 815,260 -

Freight Cars 15 - 30 1,198,207 (66,951) 1,131,256 -

Terminals 10 - 20 124,098 (5,057) 119,041 -

Equipment 10 - 15 6,966 (864) 6,102 -

2,158,646 (86,987) 2,071,659 -

Construction in Progress

Track structure 427,356 - 427,356 -

Other 320,540 - 320,540 -

747,896 - 747,896 -

9,709,755 (587,322) 9,122,433 1,084,455




33

Consolidated

Parent

Company

Land, buildings

and

improvements

Machinery,

equipment and

facilities

Freight cars and

locomotives

Construction in

progress Track structure Others Total Total

Cost:

At December 31, 2014 343,727 374,067 519,993 99,135 - 5,046 1,341,968 1,199,952

Additions 23,896 7,652 644,877 154,795 315,355 5,783 1,152,358 424,058

Business combination ALL 252,487 82,664 2,946,849 57,085 3,409,109 476,852 7,225,046 -

Disposals - (1,947) (1,473) - (4,076) (28,684) (36,180) (610)

Transfers 26,946 49,038 (1,054) 9,524 (60,874) 2,982 26,562 491

At September 30, 2015 647,056 511,474 4,109,192 320,539 3,659,514 461,979 9,709,754 1,623,891

Depreciation:

At December 31, 2014 (68,207) (131,081) (55,688) - - (2,537) (257,513) (241,085)

Additions (16,501) (37,498) (142,543) - (93,102) (26,714) (316,358) (48,842)

Disposals - 1,270 781 - 280 853 3,184 84

Transfers (18) 20 (5,836) - (10,567) (233) (16,634) 1

At September 30, 2015 (84,726) (167,289) (203,286) - (103,389) (28,631) (587,321) (289,842)

At December 31, 2014 275,520 242,986 464,305 99,135 - 2,509 1,084,455 958,867

At September 30, 2015 562,330 344,185 3,905,906 320,539 3,556,125 433,348 9,122,433 1,334,049

At September 30, 2015, the bank loans were secured by wagons and locomotives for an amount of R$ 3,413,813 (R$ 464,304 at December 31, 2014).

Capitalization of borrowing costs

During the nine-month period ended September 30, 2015, borrowing costs capitalized amounted to R$ 48,011 (R$ 29,825 at September 30, 2014). The weighted average

rate of financial charges or borrowings, used for capitalization of interest on the balance of construction in progress, was 6.72% p.a until September 30, 2015 (5.58% p.a

for the nine-month period ended September 30, 2014).




34

11. Intangible assets

Consolidated Parent Company

Goodwill (i) Concession

Rights

Improvements in

public concessions

and operation

licenses

Other Total Total

Cost:

At December 31, 2014 100,451 - 870,755 3,741 974,947 937,404

Additions - - - 585 585 368

ALL acquisition - 7,420,367 - 79,713 7,500,080 -

Disposals (ii) - - (495,116) - (495,116) -

Transfers - - (392) 1,938 1,546 (822)

At September 30, 2015 100,451 7,420,367 375,247 85,977 7,982,042 936,950

Amortization

At December 31, 2014 - - (113,433) (1,261) (114,694) (114,687)

Additions - (58,783) (34,179) (5,197) (98,159) (34,855)

Disposals (ii) - - 15,646 - 15,646 -

Transfers - - - - - (1)

At September 30, 2015 - (58,783) (131,966) (6,458) (197,207) (149,543)

At December 31, 2014 100,451 - 757,322 2,480 860,253 822,717

At September 30, 2015 100,451 7,361,584 243,281 79,519 7,784,835 787,407

(i) Goodwill arising from business combinations, of which R$ 62,922 of previously direct subsidiary Teaçú Armazéns Gerais S.A. merged by the Company, and R$ 37,529 of direct subsidiary Logispot presented

only in consolidated.

(ii) This refers to the elimination of intangible assets related to the investment in the network of ALL since it was acquired by the Company on April 1, 2015.




35

Intangibles (other than goodwill) Annual rate of

amortization September 30, 2015 December 31, 2014

Software (a) 20% 14,623 2,480

Operating license and customer base (b) 3.7% 243,281 250,825

Right of way on public concessions (c ) 5.93% - 506,497

Public concession rights (d) 1.56% 7,361,584 -

Other 64,896 -

Total 7,684,384 759,802

a) Refers mainly to the business management system - ERP of the Company

b) Port operation license and relationships with the Company's customers, from the Teaçú business combination.

c) Refers to the improvements made to the railways under concession and operated by ALL until March 31, 2015, when ALL was acquired by the Company.

d) Refers to the concession rights acquired, allocated to Malha Norte concession upon the business combination of ALL, which will be amortized the term of this concession

by 2079.

The Company annually tests the recoverable amount of goodwill arising from expected future results of business combinations. The assets subject to

depreciation and amortization are tested only if there are indicators that the carrying amount is not recoverable.




36

12. Loans and borrowings

Financial charges (a) Parent Company Consolidated

Description Index Average

interest

rate

September

30, 2015

December

31, 2014

September

30, 2015

December

31, 2014

Maturity

date

Finame Pré-fixed 4.27% 504,125 305,218 843,788 307,005 2025

Long-term

interest rate

reference

unit(“URTJ

LP”)

8.47%

432,846 457,570 433,112 457,570 2022

Finem Pré-fixed 4.02% - - 4,717 3,420 2024

URTJLP 8.25% - - 2,404,349 13,231 2029

Consumer

price index

(“IPCA”)

17.95%

- - 3,965 3,483 2021

SELIC 15.85% - - 5,984 - 2020

UMBNDES 10.16% - - 1,189 - 2022

FRN Dollar (US$) 2.63% 200,439 - 200,439 - 2017

Loan 4131 Dollar (US$) 3.13% 208,832 - 300,538 - 2017

Commercial

banks % of CDI 14.13% - - 1,450 - 2015

CDI +

spread 17.87% - - 304,711 - 2016

Pré-fixed 20.98% - - 4,860 - 2016

Debentures URTJLP 8,00% - - 2,539 - 2016

Non-

convertible

debentures % of CDI 15.26% - - 506,980 - 2018

Pré-fixed 10.1% - - 164,909 - 2020

% Net

revenue - - - 27,488 - 2016

CDI +

spread 16.16% 1,431,536 - 2,233,286 - 2018

FCO Pré-fixed 4.12% - - 3,010 - 2024

NCE Dollar (US$) 3.4% - - 127,800 - 2016

% of CDI 15.70% - - 736,588 - 2019

2,777,778 762,788 8,311,702 784,709

Current 181,511 125,893 1,398,905 127,425

Non-current 2,596,267 636,895 6,912,797 657,284

a) Financial charges at September 30, 2015, unless otherwise indicated.




37

All loans and borrowings are secured by guarantees of the Company and its subsidiaries, in the

same amounts and conditions of the debt funded. For financing of locomotives and freight cars,

the financed assets are pledged as collateral.

Some financing agreements with the BNDES are also guaranteed, according to each contract, by

a bank guarantee, with the average cost of 1.55% p.a. or by collateral (assets) and an escrow

account.

To calculate the average rates, average annual CDI of 14.13% and TJLP of 6.5% were used.

Unused credit lines

At September 30, 2015, the Company and its subsidiaries had lines of credit for financing from

BNDES, which were unused, totaling R$ 1,455,461. These credit lines are directed to support

investment in infrastructure and modernization of rolling stock (freight cars and locomotives)

until 2017.

Financial covenants

The Company and its subsidiaries are subject to certain financial covenants in most loans and

financing agreements, based on certain financial and non-financial rations. Financial ratios are: (i)

consolidated net debt / EBITDA; (ii) EBITDA / consolidated financial result (considers only

interest on debentures, loans / financing and derivative activities); (iii) equity / net assets, being

item (iii) applicable only to BNDES. Except for BNDES, whose measurement is required

annually, a quarterly measurement is required on the date of the financial statements, using the

consolidated financial statements.

On December 31, 2014, ALL failed to meet certain covenants for which waivers were later

obtained from creditors releasing ALL from early call of the debt.

Except for BNDES, whose new net debt indicators (EBITDA and ICD) are yet to be set, all other

creditors have agreed to a ratio of up to 5.5x net debt / EBITDA. If the negotiations with BNDES

require a lower leverage ratio, such ratio will be extended to all other creditors with equivalent

covenants conditions. On September 30, 2015, quarterly financial covenants were met within the

new established standards.

Debentures have covenants in similar conditions to those described and also had their covenant

net debt / EBITDA ratio adjusted to 5.5x.




38

The installments on long-term, net of amortization of issuing costs have the following scheduled

maturities:


September 30,

2015

December 31,

2014 September 30,

2015

December 31,

2014

13 to 24 months 561,268 136,234 1,429,839 140,050

25 to 36 months 1,555,033 136,234 3,082,251 139,336

37 to 48 months 157,961 136,224 824,239 139,326

49 to 60 months 111,333 125,531 468,845 128,633

61 to 72 months 83,587 60,520 515,877 63,622

73 to 84 months 50,459 35,505 179,773 38,607

85 to 96 months 37,970 6,647 96,491 7,247

Thereafter 38,656 - 315,482 463

2,596,267 636,895 6,912,797 657,284

On September 30, 2015 and December 31, 2014, carrying value approximates fair value of debt.

13. Other taxes payable


September

30, 2015

December

31, 2014

September

30, 2015

December

31, 2014

Description

Contribution to social security financing

(“COFINS”) - 1,846 1,901 1,919

Social integration program (“PIS”) - 375 408 390

National social security institute (“INSS”) 1,635 1,508 4,460 1,687

Tax on circulation of goods, transport services

and communication (“ICMS”) 53 1,025 4,134 1,025

Recovery program (“Refis”) 902 902 30,899 902

Other 1,561 1,303 11,457 1,377

4,151 6,959 53,259 7,300

Current 4,151 6,959 27,758 7,300

Non-current - - 25,501 -




39

14. Income tax and social contribution

a) Reconciliation of income tax and social contribution expenses:

Parent Company

Description

July 1, 2015

to

September

30, 2015

January 1,

2015 to

September

30, 2015

July 1, 2014

to September

30, 2014

January 1,

2014 to

September

30, 2014

Income before income taxes (50,413) (23,541) 56,691 139,499

Income tax and social contribution expense at

nominal rate (34%) 17,140 8,004 (19,275) (47,430)

Adjustments to determine the effective rate:

Equity pick-up (11,267) 6,875 169 38

Other (17) 1,946 263 482

Income (expense) tax and social

contribution 5,856 16,825 (18,843) (46,910)

Effective rate % 11.62% 71.47% 33.24% 33.63%




40

Consolidated

Description

July 1, 2015

to

September

30, 2015

January 1,

2015 to

September

30, 2015

July 1, 2014

to September

30, 2014

January 1,

2014 to

September

30, 2014

Income before income taxes (43,039) 50,631 57,695 139,743

Income tax and social contribution expense at nominal rate (34%) 14,633 (17,215) (19,616) (47,513)

Adjustments to determine the effective rate:

Equity pick-up 1,385 1,446 - -

Rate difference on deemed profit taxation method (156) 383 - -

Goodwill amortization tax (realization) 463 927 - -

Unrecognized NOLs and temporary differences (26,618) (53,903) - -

Exploration profit - tax incentive 11,850 20,946 - -

Other 359 380 245 465

Income (expense) tax and social contribution 1,916 (47,036) (19,371) (47,048)

Effective rate % 4.45% 92.90% 33.58% 33.67%




41

b) Deferred corporate income tax (IRPJ) and social contribution (CSLL) assets and liabilities:

Parent Company

Description September 30, 2015

December 31,

2014

Basis IRPJ 25% CSLL 9% Total

Tax losses:

Tax losses carry forwards – income tax 78,952 19,738 - 19,738 -

Tax losses of social contribution 104,035 - 9,363 9,363 -

Temporary differences:

Exchange variation - Cash basis 140,382 35,096 12,634 47,730 -

Derivatives (78,809) (19,702) (7,093) (26,795) -

Accelerated depreciation (234,995) (58,749) - (58,749) (65,020)

Tax goodwill amortized (13,786) (3,447) (1,241) (4,688) 8,398

Review of useful life (161,986) (40,497) (14,579) (55,076) (41,669)

Business combination - Fixed assets (137) (34) (12) (46) (405)

Business combination - Intangible assets (241,645) (60,411) (21,748) (82,159) (85,154)

Provision for judicial demands 15,525 3,881 1,397 5,278 4,488

Provision for profit sharing 14,517 3,629 1,307 4,936 3,348

Allowance for doubtful accounts 1,115 279 100 379 7,502

Other (38,332) (9,583) (3,449) (13,032) (1,335)

Total (129,800) (23,321) (153,121) (169,847)




42

Consolidated

Description September 30, 2015

December 31,

2014

Basis IRPJ 25% CSLL 9% Total

Taxes losses:

Taxes losses carry forwards – income tax 4,907,456 1,226,864 - 1,226,864 572

Tax losses of social contribution 4,934,455 - 444,101 444,101 206

Temporary differences:

Exchange variation - Cash basis 139,962 34,990 12,597 47,587 -

Derivatives (78,808) (19,702) (7,093) (26,795) -

Accelerated depreciation (307,811) (76,953) - (76,953) (65,020)

Tax goodwill amortized 94,925 23,731 8,543 32,274 8,398

Review of useful life (161,986) (40,497) (14,579) (55,076) (41,670)

Business combination - Fixed assets 802,656 200,664 72,239 272,903 (27,156)

Business combination - Intangible assets (7,612,092) (1,903,023) (685,088) (2,588,111) (85,154)

Impairment provision 1,003,927 250,982 90,353 341,335 -

Provision for judicial demands 543,102 135,775 48,879 184,654 4,549

Provision for profit sharing 66,037 16,509 5,943 22,452 3,447

Allowance for doubtful accounts 60,431 15,108 5,439 20,547 7,522

Other 699,530 174,883 62,958 237,841 (1,417)

(-) Unrecognized credits (4,187,177) (1,046,794) (376,846) (1,423,640) -

Total (1,007,463) (332,554) (1,340,017) (195,723)

Deferred income tax - Assets 1,380,332 875

Deferred income tax - Liabilities (2,720,349) (196,598)

Total deferred taxes (1,340,017) (195,723)




43

c) Changes in deferred taxes (net):


January 1, 2015 to

September 30, 2015

January 1, 2015 to

September 30, 2015

Deferred tax at the beginning of the year (169,847) (195,723)

Income statement 16,726 (20,116)

Business combination ALL - (1,125,795)

Other - 1,617

Deferred tax at the end of the period (153,121) (1,340,017)

15. Accounts payable - suppliers

The balance of the Company and its subsidiaries’ account payable consists of:


September 30,

2015

December 31,

2014

September 30,

2015

December 31,

2014

Material - - 127,375 -

Service 92,918 140,489 269,312 141,289

Fuels and lubricants - - 249,575 -

Other - - 101,060 -

Total 92,918 140,489 747,322 141,289

Current liabilities 92,918 140,489 745,931 141,289

Non-current liabilities (i) - - 1,391 -

(i) Presented in the balance sheet under "other accounts payable" in noncurrent liabilities.

16. Provision for judicial demands


September

30, 2015

December

31, 2014

September

30, 2015

December

31, 2014

Tax 2,961 1,765 65,549 1,825

Civil, regulatory and environmental - 12 115,113 12

Labor 12,564 11,421 380,927 11,541

15,525 13,198 561,589 13,378




44

Judicial deposits at September 30, 2015 and December 31, 2014, were as follows:


September

30, 2015

December

31, 2014

September

30, 2015

December

31, 2014

Tax 5,178 5,123 21,764 5,123

Civil, regulatory and environmental 536 20,321 162,815 20,321

Labor 5,458 4,203 161,015 4,227

11,172 29,647 345,594 29,671

Changes in the provision were:

Parent Company

Tax

Civil,

regulatory and

environmental

Labor Total

Balance at December 31, 2014 1,765 12 11,421 13,198

Write-offs (503) (12) (886) (1,401)

Additions 1,134 - 1,290 2,424

Monetary restatement 565 - 739 1,304

Balance at September 30, 2015 2,961 - 12,564 15,525

Consolidated

Tax

Civil,

regulatory and

environmental

Labor Total

Balance at December 31, 2014 1,825 12 11,541 13,378

Others movements (6,406) 468 - (5,938)

Installment - (2,392) (13,928) (16,320)

Write-offs (10,801) (713) (4,890) (16,404)

Business combination ALL 66,460 107,713 378,921 553,094

Additions 10,458 5,352 5,237 21,047

Monetary restatement 4,013 4,673 4,046 12,732

Balance at September 30, 2015 65,549 115,113 380,927 561,589




45

a) Tax

Judicial claims deemed as probable losses:


September

30, 2015

December

31, 2014

September

30, 2015

December

31, 2014

ICMS - Credit materials (i) - - 51,889 -

Compensation of PIS and COFINS 1,072 1,036 2,739 1,037

Other 1,889 729 10,921 788

2,961 1,765 65,549 1,825

(i) ICMS - Credit on inputs: The accrued amounts refer to essentially the disallowance of ICMS credits on acquisition of

production inputs. In the opinion of the tax authorities, such inputs would be classified as consumable materials, not entitled to

VAT credits.

Judicial claims deemed as possible losses:


September

30, 2015

December

31, 2014

September

30, 2015

December

31, 2014

Financial operations abroad (i) - - 893,551 -

Goodwill ALL (ii) - - 437,322 -

Isolated fine - PIS and COFINS /

REPORTO (xii) 251,766 - 251,766 -

ICMS - Export (vi) - - 84,911 -

MP 470 installment debts (iii) - - 99,224 -

PIS / COFINS Mutual Traffic (iv) - - 91,201 -

Intermodal (v) - - 75,441 -

PIS and COFINS - - 2,847 -

IR/CSLL - Labor provision (xiv) - - 32,668 -

Withholding income tax ("IRRF")

Swap (vii) - - 61,709 -

Stock option plan (viii) - - 56,399 -

PIS/COFINS Malha Sul (ix) - - 49,004 -

Social Security Contributions (xi) - - 40,135 -

ICMS Armazéns Gerais (x) - - 52,126 -

IOF on loan (xiii) - - 48,593 -

Other 22,711 18,215 227,249 18,215

274,477 18,215 2,504,146 18,215




46

(i) Financial operations abroad: Tax assessment notices issued to require differences in income tax, social contribution, PIS and

COFINS, for the calendar years 2005 to 2008 as a result of the following alleged violations: (a) improper deduction from taxable

income and CSL calculation basis of financial costs arising from loans with foreign financial institutions, (b) improper exclusion

from taxable income and CSL calculation basis of financial income from securities issued by the Government of Austria and the

Government of Spain, (c) no inclusion, in the income tax and CSL calculation basis, of gains earned in swap operations, and non-

taxation of financial income resulting from these contracts by PIS and COFINS, (d) improper exclusion from taxable income and

the CSLL calculation basis, using PIS and COFINS credits, (e) improper exclusion from taxable income and CSL calculation

using deferred CSL.

(ii) Goodwill ALL S.A.: Tax assessment notices issued by the tax authorities in 2011 and 2013 against ALL Holding concerning:

a) disallowance of amortization expense deduction based on future profitability as well as financial expenses; b) non-taxation of

supposed capital gain on disposal of equity interest in a company of the group.

(iii) MP 470 installment payment of debts: The tax authorities partially rejected the installment requests for federal tax debts

made by Malha Sul and Intermodal, arguing that the NOLs offered by the companies were not sufficient to discharge their

existing debts. The probability of loss is considered possible, since the NOLs existed and were available for such use.

(iv) PIS / COFINS Mutual Traffic: Tax authorities assessed ALL Malha Paulista under non-taxation by PIS and COFINS by

revenues from mutual traffic and rite of passage billed against ALL Malha Norte. The chance of loss is considered possible as tax

already has been collected by the concessionaire responsible for transporting from origin.

(v) Intermodal: Tax assessment against ALL Intermodal issued by the tax authorities concerning the disallowance of expenses

relating to the payment of variable lease installments. The chance of loss is considered possible, since the expense is ordinary and

necessary to the company's operations.

(vi) ICMS - Export: The state tax authorities assessed the rail concessions by non-taxation of VAT (ICMS) on invoices for the

provision of rail freight services for export. All assessments were contested, since there is a favorable position to taxpayers in the

higher courts, based on the Federal Constitution and Complementary Law 87/1996.

(vii) IRRF Swap: ALL Malha Paulista had part of its credit balance used to offset income tax partially disallowed by the tax

authorities on the grounds that the Company would not be entitled to offset withholding tax on swap operations.

(viii) Stock Option Plan: Tax assessment notice issued by the federal tax authorities due to no taxation by social security

contribution of the Company's stock option plans offered to its employees, based on the understanding that they had

compensation nature for services rendered.

(ix) PIS / COFINS Malha Sul: In 2012, ALL filed an application for refund of PIS / COFINS on fuels on the grounds that the

amounts charged in the price exceeded the value of the actual credit. It turns out that tax authorities did not recognize the request

for refund and imposed a fine for what they consider an improper request. ALL appealed and is awaiting an administrative

decision on the issue.

(x) ICMS Armazéns Gerais: In 2013, ALL Armazéns Gerais São Paulo branch received a tax assessment from State of São Paulo

tax authorities on the grounds that the company was not authorized to operate as a general warehouse in that state. The company

appealed at the administrative level. The company is duly registered with the commercial registry with the corporate purpose of

general warehouse, as well as it has the same object registered in the Federal Revenue Service and state tax authorities. At the

time of the release of the state registration, the tax authorities allowed the company's activities, including issuance of invoices.

(xi) Social Security Contributions: The federal tax authorities assessed ALL Malha Paulista for the nonpayment of social security

contributions on certain indemnification labor payments. The probability of loss is considered possible cud to the nature of the

funds and their eventuality characteristic.

(xii) Isolated fine - PIS / COFINS / REPORTO: The Company was assessed due to the disregard of the tax benefits of REPORTO

(PIS and COFINS suspension), on the grounds that the locomotives and freight cars purchased in 2010 were used outside the

limit area of the port. Therefore, the Company was assessed to pay PIS and COFINS, as well as an isolated fine corresponding to

50% of the value of acquired assets.

(xiii) IOF on loan: Federal tax authorities intends to enforce the incidence of IOF on current accounts held by the parent company

with subsidiaries / affiliates (most of the assessment amount). In the opinion of the tax authorities, the use of an general ledger

account named advances to related parties without formal agreement characterizes the existence of a current account, that should

be charged IOF due according to revolving credit operations regulations. The tax assessments are still being challenged at the

administrative level.




47

(xiv) Income tax / social contribution - Labor provisions: Notice of violation requiring income tax and social contribution for the

year 2009 on the grounds of the ALL would have excluded from taxable income labor provisions. Tax authorities understand

labor provisions charges were made by ALL without individualization processes (provisions and reversals), which would impact

the tax calculation. The loss is possible, considering the statute of limitations and that ALL complied with all tax rules relating to

the addition and exclusion of provisions in the calculation of income tax and social contribution.

b) Civil, regulatory and environmental

Judicial claims deemed as probable loss:


September

30, 2015

December

31, 2014

September

30, 2015

December

31, 2014

Civil (i), regulatory (ii) and environmental (iii) - 12 115,113 12

- 12 115,113 12

Judicial claims deemed as possible losses:


September

30, 2015

December

31, 2014

September

30, 2015

December

31, 2014

Civil (i) 19,535 17,539 1,128,836 17,539

Regulatory (ii) - - 296,564 -

Environmental (iii) - - 292,188 -

19,535 17,539 1,717,588 17,539

(i) Civil: The subsidiaries are parties to various civil lawsuits involving discussions for damages in general, such as

collisions in passages levels, rail running over, traffic accidents, possessory actions, extrajudicial collection and

contractual rights and obligations with customers. For the civil claims, management based on the opinion of its legal

counsel, assessed the circumstances and recognized provisions for probable losses in amounts deemed sufficient and

appropriate, representing at the reporting date, its best estimate of the disbursement that may be required to settle the

disputes.

(ii) Regulatory: Refers mainly to fines and discussions with ANTT.

(iii) Environmental: These amounts arise from assessments made by CETESB (SP), IBAMA and Municipal

Environmental authorities mostly due to soil and water contamination due to the overflow of products and non-

compliance with conditions imposed by operation licenses. Measures are being adopted to reduce the existing

liabilities, as well as repairing and prevention measures related to the environment.




48

c) Labor

Judicial claims deemed as probable loss:


September

30, 2015

December

31, 2014

September

30, 2015

December

31, 2014

Labor (i) 12,564 11,421 380,927 11,541

12,564 11,421 380,927 11,541

Judicial claims deemed as possible loss:


September

30, 2015

December

31, 2014

September

30, 2015

December

31, 2014

Labor (i) 71,013 61,678 515,547 61,915

71,013 61,678 515,547 61,915

(i) The Company and its subsidiaries discuss several labor claims filed by former employees and employees

of service providers to cover losses that are considered probable. The actions in progress, mostly claims on

overtime, night shift, unsanitary and dangerous conditions, any breach of regulatory MTE standards, job

reinstatement, compensation for work accidents and reimbursement of payroll discounts, such as

confederation dues, union dues and others, recognition of nonstop work shift, standby compensation, salary

differences and others.




49

17. Leases

Finance leases

The Company and its subsidiaries have lease agreements, mainly of railcars and locomotives,

classified as finance leases.

The balances of liabilities related to finance lease agreements are:

Consolidated

Less than

a year

Between

one and five

years

More

than five

years

Total

Future minimum lease payments 767,975 1,323,001 314,772 2,405,748

Rolling stock 743,779 1,234,039 189,726 2,167,544

Terminal

24,197 88,962 125,045 238,204

Interest in the parcel 230,928 294,637 56,538 582,103

Rolling stock 214,154 244,883 22,715 481,752

Terminal

16,774 49,754 33,823 100,351

Present value of minimum payments 537,047 1,028,364 258,234 1,823,645

Current liabilities 537,048

Non-current liabilities 1,286,597

Leases have various terms, the latter due to end in June 2022. The amounts are adjusted

annually for inflation (IGP-M and IPCA) or may incur interest calculated based on the TJLP

or CDI.

Operating lease

Total future minimum lease payments

Assets Up to 1 year From 1 to 5 years Over 5 years Total

Locomotives 12,898 3,115 - 16,013

Rail cars 6,396 19,469 14,768 40,633

Total 19,294 22,584 14,768 56,646

Operating leases payments (rentals) are recognized as expenses on a straight line basis over the term of the contracts.




50

18. Lease and Concessions

The Company and its subsidiaries recognize expenses related to operating leases arising from

the concession and concession liabilities on a straight line basis over the term of the contracts.

The lease and concession liabilities represent the updated value of the grants acquired, net of

payments made by the reporting date, as follows:

Leases Concessions Total

Amounts payable:

Malha Sul 39,125 26,017 65,142

Malha Paulista - 24,201 24,201

39,125 50,218 89,343

Amounts under judicial discussion:

Malha Paulista 1,125,209 1,559 1,126,768

Malha Oeste 861,762 56,068 917,830

1,986,971 57,627 2,044,598

Total 2,026,096 107,845 2,133,941


Non-current liabilities 2,114,396

2,133,941

Amounts under judicial discussion

The Company is challenging in court the economic and financial unbalance of certain Lease

and Concession Agreements.

In May 2005, ALL Malha Paulista filed a Declaratory Action in the 20th Federal Court of Rio

de Janeiro questioning the economic and financial unbalance of its Lease and Concession

Agreements, due to the high disbursement incurred by ALL Malha Paulista for the payment

of labor judicial proceedings and other costs involved, which are the responsibility of Rede

Ferroviária Federal S.A. (predecessor owned by the federal government).

ALL Malha Paulista required an expert new value calculation for the lease and concession

installments, as well as suspension of the payment of due and falling due installments until the

effective expert inspection for determination of the adequate value. In July 2005, an

injunction was granted. In September 2005, the said injunction was revoked by the Federal

Court of Rio de Janeiro. The value related to the lease installments was being deposited in

court until September 2007, when the Company obtained a judicial authorization to replace

the judicial deposits with a bank guarantee letter. In October 2015 a judgment was issued that

partially upheld the action recognizing the occurrence of economic and financial imbalance of

the agreements, allowing the Company to compensate part of the amounts claimed against the

debt. Nevertheless, the Company believes that all amounts discussed in the process could be

compensated, due to the provision of clause 7 of the bidding documents. Management,

supported by the opinion of its legal counsel assesses the chances of success as probable for




51

the value awarded in the decision and as possible regarding severance pay, but continues to

recognize the financial liability as it is a contractual obligation not yet removed from the

Company.

ALL Malha Oeste is claiming the reestablishment of the economic-financial balance of its

concession, lost by the cancellation of transportation agreements existing at the time of

privatization, which then set a change in the regulatory environment and conditions that were

set forth in the Notice of Privatization - growth forecasts used to value the concession deal

never materialized. The lawsuit is filed in the 16th Federal Court of Rio de Janeiro. The

amounts related to overdue installments were being secured by government bonds (Treasury

Bills - LFT). In March 2008, the Company was authorized to replace the collateral by a bank

guarantee and, in May 2008, the Company was able to redeem the bonds. In December 2014,

a decision recognized the occurrence of economic and financial imbalance of contracts, now

remaining the definition from an expert to determine the amount of the imbalance and related

aspects.

Management, based on the opinion of its lawyers, assesses the chances of success as probable,

but continues to recognize the financial liability as it is a contractual obligation not yet

removed from the Company.

Judicial deposits on September 30, 2015 concerning the above claims total:

September 30, 2015

Malha Paulista 116,038

Malha Oeste 17,690

133,728

Judicial deposits are recorded in the line "regulatory" under note 16.

19. Real estate credit certificates

The Company and its subsidiaries entered into contracts for rent of terminals that have been

securitized and resulted in the transfer of the rights of these credits, the balance of which is:

Consolidated

Terminal Rate Maturity Start date

September 30,

2015

Terminal Intermodal Tatuí-SP 12.38% p.a.

March 31,

2018

February

29, 2008 61,342

Terminal Alto Araguaia-MT CDI + 2.6% p.a.

November

30, 2018

November

28, 2008 244,755

Total 306,097


Non-current liabilities 197,409




52

20. Equity

a. Common stock

The subscribed and fully paid-in capital as of September 30, 2015 is R$5,451,490

(R$1,099,746 in December 31, 2014) and is represented by 299,015,898 (1,026,488,214 in

December 31, 2014) registered common shares with no par value.

Changes in capital and shares are as follows:

Common stock Ordinary shares

Balance at December 31, 2014 1,099,746 1,026,488,214

Capital increase (i) 4,351,744 1,963,670,770

Subtotal 5,451,490 2,990,158,984

Reverse stock split - (10:1)

Balance at September 30, 2015 5,451,490 299,015,898

(i) The Board of Directors during its meeting held on March 23, 2015, approved the conclusion of the

ALL Share Exchange with effect from April 1, 2015.

b. Capital reserve

The Company has a negative capital reserve in September 30, 2015 of R$ 1,781,811 due to the

difference between the capital increase at book value at the time of the incorporation of ALL

in the amount of R$ 4,351,744 and the market value of the shares issued considered as

consideration transferred in the amount of R$ 2,707,534 (Note 3).

c. Dividends

At the Board of Directors' Meeting held on February 6, 2015, shareholders approved by

unanimous vote and without reservations, the payment of dividends totaling R$ 300,000,

consisting of the following amounts: (i) R$ 220,584 from the retained earnings reserve

account relating to prior fiscal years, and (ii) R$ 79,416 corresponding to the portion of net

income for the fiscal year 2014, of which R$ 27,200 was allocated to the mandatory minimum

dividends account and R$ 52,216 allocated in the Company's retained earnings reserve

account.




53

21. Earnings per share

Earnings per share are calculated by dividing net income by the weighted average number of ordinary shares outstanding during the period. Diluted

earnings per share are calculated by adjusting the result and the number of shares by the impact of potentially dilutive instruments. The following table

sets forth the computation of earnings per share (in thousands, except per share amounts) for the quarter and nine-month period ended September 30,

2015 and 2014:

Basic and diluted

July 1, 2015 to

September 30,

2015

January 1, 2015

to September 30,

2015

July 1, 2014 to

September 30,

2014

January 1, 2014 to

September 30,

2014

Numerator Income from operations attributable to controlling shareholders (44,557) (6,716) 37,848 92,589

Denominator Weighted average number of common share - considers reverse stock split 299,015,898 233,560,206 102,648,821 102,648,821

Basic earnings per share R$ (0.149) R$ (0.029) R$ 0.369 R$ 0.902

Dilutive effect Brado Logística (R$ 0.009) - - -

Dilutive effect BNDES Participações (R$ 0.000) (R$ 0.003) - -

Diluted earnings per share R$ (0.158) R$ (0.032) R$ 0.369 R$ 0.902




54

The minority shareholders of the indirect subsidiary Brado have the right to exercise a

Liquidity option provided for in the shareholders' agreement signed on August 05, 2013. This

option would exchange all Brado shares held by such minority shareholders by shares of ALL.

The exchange ratio shall take into account the economic value for both Brado and ALL shares.

At the Company's exclusive discretion, an equivalent cash payment is also possible.

ALL Malha Norte issued to BNDES Participações S.A., bonds convertible into shares,

remunerated at market rates, amounting to R$ 2,539 on September 30, 2015, whose maturity is

June 2016. The conversion, if performed on July 1, 2015, would result in the issuance of

13,890 new shares by ALL Malha Norte.

Antidilutive instruments

The stock option plan (see note 22) is out of money, so, the exercise price of the options

granted is much higher than the average stock price during the period. These financial

instruments have antidilutive effects in the periods presented.

22. Stock option plan

With the acquisition of ALL by the Company, the existing compensation plan was canceled

and assumed by the Company. The fair value of the options assumed by the Company was

recalculated on the acquisition date April 1, 2015.

A total of 1,478,659 options was assumed by the Company at an average fair value per option

of R$ 0.18 calculated using the binomial method. The average exercise price is R$ 5.03. This

plan will generate total expenses relating to the plan of R$ 264 over future periods.




55

23. Gross revenues


July 1, 2015

to

September

30, 2015

January 1,

2015 to

September

30, 2015

July 1,

2014 to

September

30, 2014

January 1,

2014 to

September

30, 2014

July 1,

2015 to

September

30, 2015

January 1,

2015 to

September

30, 2015

July 1,

2014 to

September

30, 2014

January 1,

2014 to

September

30, 2014

Gross revenue from services 292,753 671,800 281,444 712,809 1,485,239 3,042,264 285,162 721,069

Taxes and deduction over sales (17,969) (46,532) (23,278) (60,256) (127,513) (258,642) (23,861) (61,354)

Net revenue 274,784 625,268 258,166 652,553 1,357,726 2,783,622 261,300 659,715

Breakdown of net revenue by service:

Consolidated

July 1, 2015

to

September

30, 2015

January 1,

2015 to

September

30, 2015

July 1,

2014 to

September

30, 2014

January 1,

2014 to

September

30, 2014

Elevation 77,799 165,319 65,159 158,467

Transport 1,061,011 2,384,783 190,658 483,397

Other 218,916 233,520 5,483 17,851

1,357,726 2,783,622 261,300 659,715

Breakdown of net revenue by region:

Consolidated

July 1, 2015

to

September

30, 2015

January 1,

2015 to

September

30, 2015

July 1,

2014 to

September

30, 2014

January 1,

2014 to

September

30, 2014

Domestic 1,301,546 2,664,499 215,166 548,735

Foreign 56,180 119,123 46,134 110,980

1,357,726 2,783,622 261,300 659,715




56

24. Financial result


July 1,

2015 to

September

30, 2015

January 1,

2015 to

September

30, 2015

July 1, 2014 to

September

30, 2014

January 1, 2014 to

September

30, 2014

July 1, 2015

to

September

30, 2015

January 1,

2015 to

September

30, 2015

July 1, 2014 to

September

30, 2014

January 1, 2014 to

September

30, 2014

Gross debt charges (46,413) (109,627) (9,868) (29,431) (194,015) (408,954) (10,033) (29,825)

Income from financial investments 1,409 6,012 6,154 27,244 32,060 68,347 6,221 27,468

(=) Subtotal: Net debt interest (45,004) (103,615) (3,714) (2,187) (161,955) (340,607) (3,812) (2,357)

Other charges and monetary restatement asset 285 776 247 1,137 19,887 29,327 248 1,133

Other charges and monetary restatement liability (3,862) (11,291) 128 (22,674) (83,931) (158,377) 213 (22,458)

Gains (losses) on derivatives 60,623 86,535 - - 71,733 96,350 - -

Foreign exchange differences (94,814) (139,101) 286 568 (139,032) (195,307) 290 572

Monetary restatement on the concession and lease

agreements - - - - (62,498) (116,189) - -

Interest and monetary restatement of finance leases - - - - (43,605) (65,822) - -

(=) Finance, net (82,772) (166,696) (3,053) (23,156) (399,401) (750,625) (3,061) (23,110)




57

25. Other income (expenses), net


July 1, 2015

to

September

30, 2015

January 1,

2015 to

September

30, 2015

July 1, 2014

to September

30, 2014

January 1,

2014 to

September

30, 2014

July 1, 2015

to

September

30, 2015

January 1,

2015 to

September

30, 2015

July 1, 2014

to September

30, 2014

January 1,

2014 to

September

30, 2014

Provision for judicial demands (803) (2,133) (559) (961) (3,436) (4,792) (567) (971)

Income of port operations - 20 2,322 10,126 - 20 2,322 10,126

Rentals and leases revenues - - - - 259 2,380 267 587

Income from sales of scrap and waste 4 59 - - 3,937 5,550 - -

Gain on settlement of pre-existing relationship - - - - - 29,838 - -

Expense with corporate restructuring operations (i) 119 (5,176) (1,405) (10,226) 119 (5,176) (1,405) (10,226)

Insurance claims recovery 5,633 14,044 577 1,091 5,633 13,877 577 1,091

Provision (reversal) for losses on doubtful accounts - - - 702 (6) (14) - 703

Other 146 89 (153) (1,720) 4,697 8,890 (177) (1,774)

5,099 6,903 782 (988) 11,203 50,573 1,017 (464)

(i) These costs relate mainly to transactions related to the acquisition of ALL control by the Company.




58

26. Discontinued operations

Discontinued operations represent the results of ALL's subsidiaries in Argentina which are in

the final phase of discontinuity. The results of discontinued operations for the period ended

September 30, 2015 are as follows:

Consolidated

Selling expenses, general and administrative (1,997)

Financial result (4,201)

Loss before income tax and social contribution (6,198)

Income tax and social contribution (8)

Loss from discontinued operations (6,206)

The operating cash flow from discontinued operations amounted to an outflow of R$ 153.

27. Financial instruments

(a) Risk Management Framework

In September 30, 2015 and December 31, 2014, the fair values related to transactions

involving derivative financial instruments to hedge the risk exposure of the Company were

measured using observable inputs such as quoted prices in active markets or discounted cash

flows based on market curves and are as follows:

Notional Fair value

September

30, 2015

December

31, 2014

September

30, 2015

December 31,

2014

Result

Exchange rate risk

Swap contracts (interest) (i) 185,929 - (37,672) - (17,787)

Swap contracts (interest / FX) (ii) 653,711 - 106,409 - 27,601

839,640 - (68,737) - 9,814

Non-current assets 80,997

Current liabilities (12,260)

(68,737)

(i) Refers mainly to an interest rate swap for the 8th issue of ALL Malha Norte debentures that have a fixed rate of

10.10% p.a. which was swapped to 109.85% of CDI.




59

(ii) In order to finance working capital, the Company entered into two contracts for external bilateral lending

through 4131 and FRN, on February 5, 2015, with (i) Itaú Unibanco S.A. Nassau Branch, (4131) worth US$ 55,635

and Banco Santander Brazil S.A. - Grand Cayman Branch (FRN) in the amount of US$ 54,000, with semi-annual

interest at the rate of 3.4255% and 2.6306% p.a., respectively, both with final maturity in 2017. These operations

were hedged in Brazilian Reais with (i) an start rate of R$ / US$ 2.6961 and CDI interest + 2.33% p.a. (Itaú

Unibanco) and (ii) start rate of R$ / US$ 2.6950 and 109.92% of interest p.a. (Banco Santander). The agreement

with Itaú Unibanco has Cosan Logística S.A. (our Parent Company) as guarantor and the fiduciary assignment of

receivables of the SWAP operation itself as collateral.

(b) Exchange rate risk

In September 30, 2015 and December 31, 2014, the Company and its subsidiaries had the

following net exposure to exchange rates on assets and liabilities denominated in US dollars:

Consolidated

September 30, 2015

December 31, 2014

R$

US$

R$

US$

Cash and cash equivalents

3,541

891

-

-

Accounts receivable

7

2

4,708

1,772

Loans and funding

(628,777)

(158,266)

-

-

Derivative financial instruments

653,711

164,542

-

-

Foreign exchange exposure, net

28,482

7,169

4,708

1,772

(c) Sensitivity analysis

The following is a sensitivity analysis of the effects of changes in the relevant risk factors to

which the Company and its subsidiaries are exposed in September 30, 2015. The indices used

in the analysis are:

Simulations exchange and interest rate on September 30, 2015

Scenarios

Probable

25%

50%

-25%

-50%

R$/US$

3.9729

4.9661

5.9594

2.9797

1.9865

CDI Average

14.13%

17.7%

21.2%

10.6%

7.1%

TJLP

6.5%

8.1%

9.8%

4.9%

3.3%

SELIC

14.15%

17.7%

21.2%

10.6%

7.1%

IPCA

9.49%

11.87%

14.24%

7.12%

4.75%

UMBNDES

0.08033

0.10041

0.12050

0.06025

0.04017

IGPM

8.35%

10.44%

12.53%

6.26%

4.18%

Sensitivity analysis of changes in exchange rates

The probable scenario was defined based on market rates in US Dollar September 30, 2015,

used in determining the fair value of derivatives. Stressed scenarios (positive and negative

effects, pre-tax) were defined based on adverse impacts of 25% and 50% in US Dollar

exchange rates used in the probable scenario.




60

Sensitivity table

Based on the assets and liabilities denominated in US Dollars, September 30, 2015, the

Company conducted simulations with an increase and decrease in exchange rate (R$ / US$) of

25% and 50%.

Given the above scenario, the gains and losses would be affected as follows:

September 30, 2015

Balances

25%

50%

-25%

-50%

Cash and cash equivalents 3,541 885 1,771 (885) (1,771)

Accounts receivable 7 2 3 (2) (3)

Derivative financial instruments 653,711

163,428

326,855

(163,428)

(326,855)

Loans and financing (628,777)

(157,194)

(314,389)

157,194

314,389

7,121 14,240 (7,121) (14,240)

The Company performed a sensitivity analysis on interest rates on loans and financing and

remuneration for CDI of financial investments considering increases and decreases of 25%

and 50%, the results are as follows:

September 30, 2015

Interest rate exposure Balances on

September 30,

2015

Probable future

balance in 1

year

25% 50% -25% -50%

Financial investments 50.525 57,664 7,571 15,141 (7,571) (15,141)

Marketable securities 879,027 1,003,233 31,052 62,103 (31,052) (62,103)

Loans and financing (5,408,036) (6,172,191) (190,721) (381,441) 190,721 381,441

Debentures (2,903,667) (3,313,955) (102,572) (205,144) 102,572 205,144

Derivative interest rate (37,672) (42,995) (1,244) (2,488) 1,244 2,488

Advance of real estate credits (306,098) (325,994) (10,813) (21,626) 10,813 21,626

Leases (1,823,645) (2,081,326) (64,420) (128,840) 64,420 128,840

Impact on income for the period (331,147) (662,295) 331,147 662,295

The categories of financial instruments are presented as follows:

Measured at fair

value through

profit or loss

Other financial

assets and

liabilities (*)

Total

Assets

Marketable securities - 879,027 879,027

Accounts receivable - 208,258 208,258

Restricted cash - 92,628 92,628

Derivative financial instruments 80,997 - 80,997

Related parties - 24,889 24,889

80,997 1,204,802 1,285,799




61

Liabilities

Long-term debt (628,777) (7,682,925) (8,311,702)

Finance leases - (1,823,645) (1,823,645)

Real estate credit certificates - (306,097) (306,097)

Lease and concessions - (2,133,941) (2,133,941)

Derivatives financial instruments (12,260) - (12,260)

Related parties - (85,221) (85,221)

Accounts payable - (745,949) (745,949)

(641,037) (12,777,778) (13,418,815)

(*)Except for marketable securities and restricted cash, classified as financial assets available for sale.

(d) Capital management

Management monitors returns on capital, which the Company defines as result from operating

activities divided by total equity and financial leverage ratios, involving cash generation

(EBITDA), short-term debt and total debt.

For more information see note 20 of the financial statements of December 31, 2014.

(e) Fair value hierarchy

Financial assets of R$ 80,997 and liabilities of R$ 641,037 are measured at fair value using

Level 2 inputs. Other financial instruments are measured at amortized cost which

approximates fair values at the reporting date.

(f) Liquidity risk

September 30, 2015

Up to 1 year 1 to 2 years From 2 to 5

years

Over 5 years Total

Accounts payable - suppliers (745,931) - - - (745,931)

Leases (1,232,995) (1,118,432) (384,896) (343,885) (3,080,208)

Loans and financing (1,926,576) (5,641,953) (2,085,155) (1,845,937) (11,499,621)

Advance of real estate credits (138,869) (251,183) (27,225) - (417,277)

Derivatives (34,205) 98,600 (30,833) (5,052) 28,510

Total (4,078,577) (6,912,968) (2,528,109) (2,194,874) (15,714,528)

The long term liability regarding lease and concessions are not considered in the liquidity analysis due to the legal

discussion on those amounts presented in note 18.




62

28. Operating segment information

Management evaluates the performance of its operating segments based on EBITDA (earnings

before income tax and social contribution, interest, depreciation and amortization).

As mentioned in Note 2.1, with the acquisition of ALL, operating segments have been revised

and became defined as follows:

Operational segments

(i) North Operations: comprised of the railway operations, transshipment and port

elevation in the areas of the Company's concession, ALL Malha Norte and ALL Malha

Paulista.

(ii) South Operations: comprised of the railway and transshipment in the concession area

of ALL Malha Sul and ALL Malha Oeste.

(iii) Container Operations: comprised by Group Company this focuses on container

logistics either by rail or road transport and other container operations results.

The segment information has been prepared in accordance with the same accounting policies

used in preparing the consolidated information.

As the acquisition of ALL occurred on April 1, 2015, the result of information with new

segments are presented only for 2015, as for all prior periods, the Company had only one

reportable segment, coinciding with the results consolidated, as shown below.

Quarter ended and nine months period ended September 30, 2015 and 2014:

July 1, 2015 to September 30, 2015

Results by Segment North

Operations

South

Operations

Container

Operations Consolidated

Net revenue 972,369 317,885 67,472 1,357,726

Cost of services (558,499) (272,570) (90,346) (921,415)

Gross profit 413,870 45,315 (22,874) 436,311

Gross margin (%) 42.6% 14.3% -33.9% 32.1%


Other income (expenses) and equity 11,652 3,588 35 15,276

Depreciation and amortization 130,429 50,429 14,474 195,332

EBITDA 490,230 85,010 (23,546) 551,694

Margin EBITDA (%) 50.4% 26.7% -34.9% 40,6%




63

January 1, 2015 to September 30, 2015

Results by Segment North

Operations

South

Operations

Container

Operations Consolidated

Net revenue 1,995,330 638,036 150,256 2,783,622

Cost of services (1,130,044) (518,094) (185,625) (1,833,763)

Gross profit 865,286 119,942 (35,369) 949,859

Gross margin (%) 43.4% 18.8% -23.5% 34.1%


Other income (expenses) and equity 48,671 5,738 418 54,827

Depreciation and amortization 272,339 97,466 29,066 398,871

EBITDA 1,043,300 192,320 (35,493) 1,200,127

Margin EBITDA (%) 52.3% 30.1% -23.6% 43,1%

July 1, 2014 to September 30, 2014

Results by Segment North Operations Consolidated

Net revenue 261,300 261,300

Cost of services (180,666) (180,666)

Gross profit 80,634 80,634

Gross margin (%) 30.9% 30.9%

Selling, general and administrative (20,895) (20,895)

Other income (expenses) and equity 1,017 1,017


EBITDA 86,406 86,406

Margin EBITDA (%) 33.1% 33.1%

January 1, 2014 to September 30, 2014

Results by Segment North Operations Consolidated

Net revenue 659,715 659,715

Cost of services (432,766) (432,766)

Gross profit 226,949 226,949

Gross margin (%) 34.4% 34.4%

Selling, general and administrative (63,632) (63,632)

Other income (expenses) and equity (464) (464)


EBITDA 233,231 233,231

Margin EBITDA (%) 35.3% 35.3%

29. Subsequent events

Stock Option Plan

On October 2, 2015, the Board of Directors approved the creation of the Stock Option Plan

Calendar Year 2015 ("2015 Program").

A total of 4,485,238 options were granted at an exercise price of R$ 7.31 (to be adjusted by

IPCA until the date of exercise). This plan has a single vesting period of 5 years and the

options can be exercised at any time between October 1, 2020 and 2022.




64

30. Supplementary information – Statements of consolidated cash flows for the

quarter ended September 30, 2015.

July 1, 2015 to

September 30,

2015

July 1, 2014 to

September 30,

2014

Cash flows from operating activities

Income before income taxes (43,039) 57,695

Adjustments to reconcile net income before income tax and social contribution to

cash flows from operating activities:


Equity pick-up of associates (4,074) -


Loss on disposal of fixed assets and intangible 2,685 -

Provision (reversal) for losses on judicial demands (1,474) 567

Reversal for losses on doubtful accounts (398) -

Other 37,259 -

Interest, indexation charges and exchange variations, net 406,951 10,687

617,217 98,086

Changes in:

Accounts receivable 1,320 (79,452) Advances from customers 7,057 (2,619)

Judicial deposits 13,545 (386)

Related parties 44,190 820

Other recoverable taxes 4,011 11,801 Taxes payable (18,060) (13,819)

Inventories (64,422) (788)

Salaries payable 12,423 1,365

Accounts payable 40,056 31,380 Deferred income (8,052) 105

Judicial demands (8,419) (518)

Other asset and liabilities, net (42,971) (2,385)

Net cash from operations activities 597,895 43,590


Purchase of property and equipment, software and intangible assets (387,563) (85,551)

Marketable Securities (344,597) -

Restricted cash 55,698 -

Net cash used in investing activities (676,462) (85,551)


Proceeds from debt 586,774 80,024

Repayments of principal (528,339) (27,798)


Derivative financial instruments (11,854) -

Dividends paid (1,500) (125,000)

Net cash used in financing activities (192,082) (83,644)







65 of 85

EARNINGS RELEASE 3Q15

São Paulo, November 5, 2015 – RUMO LOGÍSTICA OPERADORA MULTIMODAL S.A. (BM&FBovespa: RUMO3)

(“Rumo ALL”) and COSAN LOGÍSTICA S.A. (BM&FBovespa: RLOG3) (“Cosan Logística”) announce today their

results for the third quarter of 2015 (3Q15) comprising the months of July, August and September 2015. The results are

consolidated in accordance with the accounting practices adopted in Brazil and the International Financial Reporting

Standards (IFRS) applied to the interim financial statements.

Rumo ALL Highlights in 3Q15

Consolidated EBITDA of Rumo ALL grew 3% to R$551 million, despite higher costs and expenses resulting from the reclassification of maintenance expenses (parts, services and personnel)

Total volume transported reached 12.5 billion RTK (up 6% from 3Q14), mainly due to the 14% increase in the transportation of agricultural products

North Operations presented 16% volume growth and R$490 million of EBITDA (18% up from 3Q14)

Port loading of 3.7 million tons: up 20% from 3Q14 due to the sugar crop peak season, as well as additional corn volumes in the quarter

3Q15 3Q14 Chg. % Summary of Financial Information - Rumo ALL 9M15 9M14 Chg. %

Combined

(Amounts in R$ MM) Combined Combined

1,357.7 1,111.1 22.2% Net Revenue 3,548.2 3,247.8 9.2%

436.3 401.3 8.7% Gross Profit 1,158.1 1,230.8 -5.9%

551.6 536.0 2.9% EBITDA 1,450.0 1,554.9 -6.7%

40.6% 48.2% -7.6 p.p. EBITDA Margin (%) 40.9% 47.9% -7.0 p.p.

(43.7) 68.2 n/a Net Income (Loss) (237.5) 167.6 n/a

-3.2% 6.1% -9.4 p.p. Net Margin (%) -6.7% 5.2% -2.3 p.p.

479.3 406.6 17.9% Capex 1,435.3 1,115.8 28.6%

Note 1: The combined results refer to the sum of Rumo and ALL consolidated with the appropriate eliminations of transactions with related parties, not

necessarily fulfilling all the requirements of OCPC 06 - Presentation of Financial Pro Forma.

Investor Relations

E-mail: [email protected]

Phones: +55 41 2141-7459

+55 11 3897-9797

Website: ir.rumoall.com

Portuguese – 11:00 a.m. (EST)

November 6, 2015 (Friday)

Phone: + 55 11 3193 1001

+ 55 11 2820 4001

Code: RUMO

English – 12:00 p.m. (EST)

November 6, 2015 (Friday)

Phone (BR): + 55 11 3193 1001

+ 55 11 2820 4001

Phone (USA): +1 786 924 6977

Code: RUMO

Conference Call

66 of 85

Earnings Release 3rd Quarter of 2015

1. Executive Summary 3Q15

In October 2015, Brazil’s National Supply Company (CONAB) concluded its analysis of total grain

production in Brazil in the 2014/15 crop year, which reached an all-time high of 210 million tons.

Soybean and corn grew 11.8% and 8.4%, respectively, from the 2013/14 crop year. The key drivers of

this improved performance were productivity gains and expansion of the planting area in almost all

producing states, mainly in the Midwest region and in Paraná State. In this scenario, our business

benefitted significantly, since 80% of our transportation volumes consist of agricultural products bound for

exports.

Volume transported in 3Q15 grew 6.3% to 12.5 billion RTK. This increase reflects the 14.1% growth in

the volume of agricultural products transported, driven by corn in the second crop. Operational

improvements implemented during the quarter also boosted our productivity. Our fleet renovation plan,

which remains on schedule, has expanded capacity while reducing transit time in the main corridor of the

North Operations. We also made great progress in operational safety aspects.

Consolidated EBITDA in the quarter totaled R$551.6 million, up 2.9% from 3Q14. The increases on

volume and average yield were the key drivers of EBITDA growth. Meanwhile, EBITDA margin decreased

7.6 p.p. (40.6% in 3Q15 vs. 48.2% in 3Q14), impacted by increases in costs and expenses due to the

reallocation of maintenance costs and personnel expenses in accordance with the new criteria adopted by

the company as from 2Q15.

EBITDA in 9M15 reached R$1,450 million, nearly 80% of the midpoint of our guidance for 2015.

Market data (CONAB) point to significant growth in corn production in the second crop. Moreover, the

depreciation of the Brazilian real continues to drive up domestic corn prices, even after the record harvest

in the 2014/15 crop and the bumper grain production in the U.S., which should maintain the brisk pace of

exports in 4Q15. Brazil has been consolidating its position as an important corn exporter and this trend

should continue in 2016. Another significant aspect of freight supply and demand is the accumulated data

from FENABRAVE until September 2015. Note that truck sales fell by 44%, which could boost demand for

railroad transportation in the coming months.

Capex increased by 17.9% from 3Q14, which totaled R$479.3 million. Maintenance Capex

decreased from the year-ago period due to the allocation of part of the expenditure as operating costs in

3Q15. Whereas expansion Capex grew focused on the acquisition of rolling stock (locomotives and

freight cars) and materials and services for renovation of the rail structure (tracks and steel sleepers), in

accordance with the guidelines of our investment plan.

In 3Q15 the company registered net loss of R$43.7 million and leverage of 4.85 times the net

debt/LTM EBITDA. Net income (loss) was affected by: (i) higher operating costs and expenses due to

the adoption of new accounting policies; and (ii) higher financial expenses due to the increase in the

average balance and debt costs in line with the increase in average interest rates (CDI and TJLP)

between periods. Leverage decreased by 2.3% compared to 2Q15 due to the improvement in EBITDA

LTM.

All the comments in this report refer to the integrated operations of Rumo ALL, but all the 3Q15

financial information related to Cosan Logística is available in the appendices. We also provide all

the financial information published herein in our Investor Relations website (ir.rumoall.com) to facilitate the

analysis of our results going forward.

67 of 85


2. Consolidated Operating and Financial Indicators

3Q15 3Q14

Chg. % Operational na Financial Indicators 9M15 9M14

Chg. %

Combined (Amounts in R$ MM) Combined Combined

12,494 11,757 6.3% Transported Volume (millions RTK) 32,778 31,835 3.0%

10,240 8,978 14.1% Agricultural Products 25,974 24,126 7.7%

2,254 2,779 -18.9% Industrial Products 6,804 7,709 -11.7%

90.1 76.0 18.6% Average Transportation Yield (R$/000 RTK) 92.8 86.3 7.5%

3,747 3,124 19.9% Volume Loaded (TU '000) 8,168 8,059 1.4%

1,357.7 1,111.1 22.2% Net Operating Revenue 3,548.2 3,247.8 9.2%

1,058.6 818.9 29.3% Rail Operations 2,804 2,536 10.6%

77.8 65.2 19.4% Port Elevation 165.3 158.5 4.3%

221.3 227.0 -2.5% Other Net Revenue² 579.0 553.0 4.7%

551.6 536.0 2.9% EBITDA 1,450.0 1,554.9 -6.7%


Note 2: Includes income for the right of way of other railways, the sugar transportation revenues using other railways as well as using road transportation.

Transported Volume (millions RTK) and Average Transportation Yield (R$/000 RTK)

Rumo ALL Consolidated Transported Volumes

3Q15 3Q14 Chg. %

Operational Figures 9M15 9M14 Chg. %

Combined Combined Combined



1,079 1,067 1.1% Soybean 10,631 10,688 -0.5%

1,326 1,383 -4.1% Soybean meal 4,091 3,751 9.1%

6,342 4,688 35.3% Corn 7,372 5,319 38.6%

1,225 1,377 -11.0% Sugar 2,913 3,214 -9.4%

236 322 -26.7% Fertilizers 612 826 -25.9%

- 70 -100.0% Wheat 203 146 38.9%

32 72 -56.0% Rice 155 182 -15.1%


1,202 1,281 -6.2% Fuels 3,296 3,468 -5.0%

264 506 -47.9% Pulp and Paper 1,038 1,367 -24.1%

524 584 -10.2% Containers 1,631 1,615 1.0%

178 226 -21.1% Construction 533 674 -21.0%

35 100 -65.3% Steel and Mining 141 305 -53.6%

51 82 -38.5% Others 165 280 -41.0%

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3. Market Scenario

Calendar of Brazilian Crops

The four railroad concessions we operate cover approximately 12,000 kilometers of railroads

located in the South, Southeast and Midwest regions of Brazil, where approximately 80% of the

country's GDP is concentrated. Our railroads transport agricultural commodities and industrial products,

and are connected to the country's four main ports. Those four ports concentrate most of the country's

agricultural commodity exports. Exported agricultural commodities account for 70% to 80% of the volume

transported in this segment. The following table highlights the calendar of the main agricultural

commodities transported by Rumo ALL.

Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

1.6% 1.8% 8.1% 13.7% 15.0% 14.3% 13.2% 11.3% 9.5% 5.9% 3.1% 2.4%

8.1% 7.5% 6.5% 4.6% 5.3% 4.9% 5.7% 9.6% 12.7% 11.9% 11.5% 11.6%

5.7% 5.1% 5.2% 4.1% 7.0% 9.0% 11.1% 12.5% 11.5% 11.8% 9.4% 7.5%

Note: Exports*: 5-year average according to Brazilian Trade Balance

Source: SLC Agrícola, Raízen, Sã Martinho, SECEX, Embrapa, BofA Merrill Lynch Global Research

35% of sales

Exports*

Planting 2nd Crop

Planting 1st Crop

Handling 2nd Crop

Harvest 1st Crop

Harvest 2nd Crop

Handling 1st Crop

Corn

10% of sales 15% of sales 40% of sales

Exports*

Handling

Harvest

30% of sales 40% of sales 20% of sales 10% of sales

Soybean

Previous Fiscal Year Fiscal Year

3Q 4Q 1Q 2Q 3Q 4Q

Planting

Exports*

Sugar

Planting

Harvest

30% of sales 15% of sales 30% of sales 25% of sales

Handling

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Freight Dynamics in the Brazilian Market

Freight prices in Brazil are freely negotiated based on supply and demand. Freight prices, however,

are influenced by variables such as distance traveled, operating costs, the possibility of back hauling,

speed of loading and unloading, seasonality of demand for transportation, delivery time and some

geographical aspects. Agricultural trading is particularly sensitive to changes in transportation costs since

they account for a significant portion of the final price.

Given the dynamics described above, there is no official benchmark price in the Brazilian market

for road or railroad freights. The most important road routes are monitored by economic research

institutes to check the behavior of market prices. The data collected can serve as the basis for negotiating

the freights for specific products and their respective destinations. The table below shows historical freight

prices between the Rondonópolis (Mato Grosso) and the Port of Santos (São Paulo). This route is

responsible for a significant portion of the grains transported in Brazil according to the Instituto Mato-

Grossense de Economia Agropecuária (IMEA; www.imea.com.br).

Source: IMEA Note: monthly moving average freight released weekly by IMEA

http://www.imea.com.br/

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4. Result by Business Unit

Business Unit

The business units (reporting segments) are organized as follows:

North Operations Malha Norte, Malha Paulista and Port Operation in Santos

South Operations Malha Oeste and Malha Sul

Container Operations Container operations including Brado Logística

Results by Business Unit

Northern Operations

Southern Operations

Containers Operations

Consolidated 3Q15

Net Revenue 972.4 317.9 67.5 1,357.7

Cost of Goods and Services (558.5) (272.6) (90.3) (921.4)

Gross Profit 413.9 45.3 (22.9) 436.3

Gross Margin(%) 42.6% 14.3% -33.9% 32.1%

Selling Expenses, General and Administrative Expenses (65.7) (14.3) (15.2) (95.2)

Other Operating Revenues (Expenses) 11.6 3.6 0.0 15.2

Depreciation and Amortization 130.4 50.4 14.5 195.3

EBITDA 229.3 (15.8) (52.5) 161.0

EBITDA Margin (%) 23.6% -5.0% -77.8% 11.9%

Results by Business Unit

Northern Operations

Southern Operations

Containers Operations

Consolidated 9M15 Combined

Net Revenue 2,444.6 866.9 236.7 3,548.2

Costs of Services (1,392.9) (721.0) (276.1) (2,390.0)

Gross Profit 1,051.8 145.8 (39.5) 1,158.1

Gross Margin(%) 43.0% 16.8% -16.7% 32.6%

Selling Expenses, General and Administrative Expenses (145.4) (52.0) (43.0) (240.4)

Other Operating Revenues (Expenses) 16.0 (3.1) 1.7 14.7

Depreciation and Amortization 355.3 145.0 44.3 544.6

EBITDA 567.0 (54.2) (125.0) 387.8

EBITDA Margin (%) 23.2% -6.3% -52.8% 10.9%

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North Operations

3Q15 3Q14 Chg. %





156 379 -58.9% Soybean 7,149 7,581 -5.7%

1,188 1,214 -2.1% Soybean meal 3,555 3,183 11.7%

5,571 4,008 39.0% Corn 6,396 4,284 49.3%

484 572 -15.4% Sugar 1,335 1,564 -14.6%

- 15 -100.0% Fertilizers 1 62 -97.7%

727 826 -11.9% Industrial Products 2,047 2,168 -5.6%

648 538 20.4% Fuels 1,594 1,458 9.3%

79 288 -72.5% Pulp and Paper 453 709 -36.2%


3,747 3,124 19.9% Volume Loaded (TU '000) 8,168 8,059 1.4%

Total volume transported in the North Operations was 8.1 billion RTK, up 15.8% from 3Q14. The

higher volume in 3Q15 is mainly due to the second corn crop. The depreciation of the Brazilian currency, which enables better pricing of grain to the producer as well as the higher international demand for Brazilian corn, have established good commodity marketing conditions in 3Q15. Consequently, corn transportation volume grew 39.0%, representing a market share of approximately 60% of the volume of grains shipped through the port of Santos (SP) in the quarter. Transportation of industrial products in 3Q15 decreased 11.9% from 3Q14. Volume of pulp and

paper products transported decreased by 72.5%, mainly due to the strong comparison base in 3Q14, when there was an unusually significant volume, in addition to the inauguration of an important client terminal in the port of Santos (SP) that has privileged road transport. However, the volume of fuel transported increased 20.4% in the period, reflecting the operational start-up of the Raízen and Ipiranga plants in Rondonópolis in 2Q15. The volume loaded at the terminals controlled by Rumo ALL in the Port of Santos totaled 3.7 million tons, up 19.9% from 3Q14. In 3Q15, Rumo ALL loaded a huge volume of sugar due to peak

crop season, as well as additional volumes of corn (approximately 680,000 tons), a product not operated in 3Q14.

3Q15 3Q14 Chg. %

Financial Results 9M15 9M14 Chg. %


972.4 746.2 30.3% Net Operating Revenue 2,444.6 2,151.9 13.6%

740.7 528.5 40.2% Transportation 1,937.0 1,652.3 17.2%

678.0 467.6 45.0% Agricultural Products 1,757.8 1,477.5 19.0%

62.7 60.9 3.0% Industrial Products 179.2 174.7 2.5%

77.8 65.2 19.4% Port Elevation 165.3 158.5 4.3%

153.9 152.5 0.9% Other Net Revenue 342.3 341.1 0.3%

(558.5) (418.6) 33.4% Costs of Services (1,392.9) (1,131.4) 23.1%

413.9 327.6 26.3% Gross Profit 1,051.8 1,020.5 3.1%

42.6% 43.9% -1.3 p.p. Gross Margin (%) 43.0% 47.4% -4.4 p.p.

(65.7) (45.9) 43.3% Selling, General and Administrative Expenses (183.1) (145.4) 26.0%

11.6 13.4 -13.9% Other Operational Revenues (Expenses) and Equity Pickup

26.7 16.0 67.3%

130.4 121.8 7.1% Depreciation and Amortization 355.3 344.9 3.0%

490.2 416.9 17.6% Total EBITDA 1,250.7 1,236.0 1.2%


Note 2: Includes income for the right of way of other railways, the sugar transportation revenues using other railways as well as using road transportation.

Net revenue from North Operations totaled R$972.4 million in 3Q15, up 30.3% from 3Q14. This

growth was primarily driven by revenue from transportation of agricultural products, which was 45.0% higher than in 3Q14, basically due to the growth in corn transportation volume. Average transportation yield in 3Q15 increased significantly by 21.0% to reach R$91.2/thousand RTK, due to better prices for grain transportation, which were more competitive than those charged for road transportation.

Cost of services provided increased by 33.4% from 3Q14 to reach R$558.5 million, mainly due to higher volumes transported. Other factors also contributed to the increase in costs, such as: (i) higher

expenses with diesel due to the increase in average prices between the periods (ANP: +14.1% diesel), partially offset by the lower unit consumption due to the arrival of new locomotives over the course of the year; (ii) higher allocation of maintenance and personnel costs (R$40.9 million), in line with the new criteria adopted since 2Q15.

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EBITDA from North Operations reached R$490.2 million, up 17.6% from 3Q14. The growth in

volumes transported and increase in average yield, combined with the operational improvements implemented, were the key drivers of this growth.

South Operations

3Q15 3Q14 Chg. %



3,844 4,159 -7.6% Transported Volume (millions RTK) 10,664 11,378 -6.3%


923 688 34.1% Soybean 3,482 3,106 12.1%

138 169 -18.1% Soybean meal 536 568 -5.8%

772 680 13.5% Corn 976 1,035 -5.7%

742 804 -7.8% Sugar 1,577 1,650 -4.4%

236 307 -23.2% Fertilizers 610 764 -20.1%

- 70 -100.0% Wheat 203 146 38.9%

32 72 -56.0% Rice 155 182 -15.1%


554 743 -25.4% Fuels 1,702 2,010 -15.3%

185 219 -15.5% Pulp and Paper 585 657 -11.0%

178 226 -21.1% Construction 533 674 -21.0%

35 100 -65.3% Steel and Mining 141 305 -53.6%

51 82 -38.5% Others 165 280 -41.0%


The South Operations transported 3.8 billion RTK in 3Q15, a decrease of 7.6%. Volume of

agricultural products grew 1.9% in the quarter. Soybean transported volume increased by 34.1% due to

the shipment of the crop, which lasted until mid-3Q15 on account of heavy rainfall during the period,

which delayed harvest. Crop transported volume grew 13.5%, due to higher exports on account of

favorable price and demand conditions. Sugar transported volumes decreased by 7.8%, due to adverse

price and demand conditions for the commodity in the beginning of the crop season.

Volume of industrial products decreased by 26.8% due to: (i) lower demand for fuels, reflecting the

slowdown in economic activity and the fuel transportation stoppage of Malha Oeste; (ii) the 15.5% drop in

the volume of forest products caused by the interruption of certain flows and the temporary shutdown of a

plant of an important client; (iii) operational problems in Rio Grande do Sul and Paraná, which restricted

circulation in a few stretches, reducing the availability of routes; and (iv) heavy rainfall in the beginning of

the quarter, which affected our port operations in the South region.

3Q15 3Q14 Chg. %



317.9 290.4 9.5% Net Operating Revenue 866.9 884.0 -1.9%

317.9 290.4 9.5% Transportation 866.9 884.0 -1.9%

224.5 182.6 22.9% Agricultural Products 597.9 557.7 7.2%

93.4 107.8 -13.3% Industrial Products 269.0 326.3 -17.6%

(272.6) (210.5) 29.5% Costs of Services (721.0) (661.8) 8.9%

45.3 79.9 -43.3% Gross Profit 145.8 222.2 -34.4%

14.3% 27.5% -13.3 p.p. Gross Margin (%) 16.8% 25.1% -8.3 p.p.



(3.1) 4.6 n/a


85.0 118.9 -28.5% Total EBITDA 235.8 321.0 -26.6%


Net revenues from South Operations totaled R$317.9 million in 3Q15, up 9.5% from 3Q14. This

growth reflects the 18.4% increase in average yield, which reached R$82.7/thousand RTK due to the increase in the price for transporting agricultural products in the Central Corridor of Paraná, which connects the North of Paraná to the Port of Paranaguá. Note that in 3Q14, the Company reduced yields to gain market share due to a scenario of weak demand and low road freight prices. Cost of services provided increased by 29.5% to R$272.6 million in 3Q15. This increase mainly

reflects the hike in maintenance and personnel costs (R$47.9 million) resulting from changes in the criteria adopted by the Company since 2Q15. The decrease of 28.5% in EBITDA from South Operations, which totaled R$85.0 million, is mainly

due to lower transported volumes of industrial goods (24.9%) and higher costs, particularly because of higher maintenance and personnel costs.

73 of 85


Container Operations

3Q15 3Q14

Chg. % Operational Figures 9M15 9M14

Chg. %


19,285 20,678 -6.7% Total Volume (Containers '000) 59,845 55,538 7.8%

3.5 3.6 -2.9% Average Yield (R$ '000/containers) 4.0 3.8 3.6%

524 584 -10.2% Total Volume (millions RTK) 1,631 1,615 1.0%

The volume of transported containers decreased by 6.7% in 3Q15, equivalent to a 10.2% drop in RTK (60 million RTK). This decrease is due to lower transported volumes in the Rio Grande do Sul and

Mercosur corridors, as well as the loss of a major client in the refrigerated container segment in 2Q15.

3Q15 3Q14 Chg. % Financial Results 9M15 9M14 Chg. %

Combined

(Amounts in R$ MM) Combined Combined

67.5 74.5 -9.5% Net Operating Revenue 236.7 211.9 11.7%

(90.3) (80.7) 12.0% Costs of Services (276.1) (223.8) 23.4%

(22.9) (6.2) n/a Gross Profit (39.5) (11.9) n/a

-33.9% -8.3% -25.6 p.p. Gross Margin (%) -16.7% -5.6% -11.1 p.p.



1.7 8.1 -78.4%


(23.5) 0.2 n/a Total EBITDA (36.5) (2.1) n/a

-34.9% 0.2% -35.1 p.p. EBITDA Margin (%) -15.4% -1.0% -14.4 p.p.

Net revenues reached R$67.5 million in 3Q15, due to the lower volume of containers handled and the

2.9% decrease in average yield. Cost of services provided increased 12.0% compared to 3Q14, reaching R$90.3 million. This

increase is primarily due to the increase in variable costs at some ports operated by Brado, and to the higher fixed cost when compared to 3Q14. EBITDA from Container Operations was a loss of R$23.5 million, impacted by the increase in costs

and expenses in the period.

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5. Other Result Items

Breakdown of Costs of Services Provided

3Q15 3Q14 Chg. %

Consolidated Costs 9M15 9M14 Chg. %


(921.4) (709.8) 29.8% Costs of Services (2,390.0) (2,017.0) 18.5%

(202.8) (191.3) 6.0% Fuels and Lubricants (539.8) (473.5) 14.0%

(193.0) (173.5) 11.3% Depreciation and Amortization (538.1) (510.9) 5.3%

(170.6) (146.0) 16.8% Logistics Cost (358.9) (323.4) 11.0%

(70.7) (6.7) n/a Maintenance (parts and services) (148.4) (25.5) n/a

(112.1) (89.2) 25.7% Payroll Expenses (324.3) (270.9) 19.7%

(47.5) (43.5) 9.1% Leasing and Concession (141.0) (136.3) 3.4%

(14.6) (15.2) -3.7% Operational Leasing (40.2) (49.8) -19.2%

(29.6) (16.9) 75.6% Third Paties Services (65.1) (67.0) -2.9%

(80.5) (27.5) n/a Other Operational Costs (234.3) (159.7) 46.7%

Consolidated cost of services provided increased by 29.8% in 3Q15 to R$921.4 million, due to: (i)

higher spending on diesel and lubricants due to the increase in average prices between the periods (ANP: +14.1% diesel), as well as higher volumes consumed, which were partially offset by lower unit consumption of diesel of the new locomotives; (ii) higher depreciation and amortization costs due to the revision of the useful life of assets; (iii) higher logistics costs due to the use of road transportation and other railroads to transport certain cargo; and (ii) higher maintenance and personnel costs (+R$88.9 million) following the new criteria adopted by the Company in 2Q15.

Financial Result

3Q15 3Q14 Chg. %



(194.0) (188.2) 3.1% Gross Banking Debt Charges (589.3) (524.5) 12.4%

71.7 0.9 n/a Gain (loss) with derivatives 109.4 6.9 n/a

(139.0) (6.9) n/a Exchange Rate Variation (222.6) (19.7) n/a

32.0 89.1 -64.1% Income from Financial Investments 112.2 208.8 -46.3%

(229.3) (105.1) n/a (=) Subtotal: Net Banking Debt Interests (590.3) (328.5) 79.7%

(62.5) (42.9) 45.7% Monetary variation on lease and concession agreements (166.2) (81.2) n/a

(107.7) (118.2) -8.9% Lease interest and other monetary variation (307.5) (416.0) -26.1%

(399.5) (266.2) 50.1% (=) Financial, Net (1,064.0) (825.7) 28.9%

The financial result in 3Q15 reflects a 50.0% increase in expenses compared to 3Q14, due to: (i)

the increase in gross debt charges following the increase in the outstanding balance and the hike in interest rates (CDI and TJLP) between the periods; (ii) lower returns from financial investments caused by the reduction in the average balance of financial investments, despite the hike in interest rates (CDI); and (iii) the negative impact of approximately R$ 70 million (non-cash) from fixed to floating interest rate swap due to the increase of CDI future curve. Monetary variation on leasing and concession agreements reflects the update (SELIC) of the unpaid concession amounts of the Malha Oeste and Malha Paulista, which are currently under litigation.

Income Tax and Social Contribution

3Q15 3Q14 Chg. %

Income Tax and Social Contribution 9M15 9M14 Chg. %


(43.0) 89.6 n/a Income (loss) before income tax (158.7) 207.5 n/a

34% 34% n/a Theoretical rate - income tax 34% 34% n/a

14.6 (30.5) n/a Income Theoretical Tax Expenses -

Adjustments to calculate the effective rate

(26.6) (20.9) 27.4% Tax losses not recognized³ (153.4) (67.1) n/a

- 28.9 n/a Recognition of fiscal credits from previous years

- 74.3 n/a

11.9 2.8 n/a The operating profit of North Network4 29.4 32.4 -9.4%

2.1 2.1 -2.4% Other effects 0.7 (10.7) n/a

1.9 (17.6) n/a Income Tax Expenses (69.4) (41.7) 66.6%

-4.5% -19.6% 15.2 p.p. Effective rate - current (%) 0.4 (0.2) 63.8 p.p.

Note 3: We did not constitute IR / CS deferred tax losses from specific companies due to the lack of future taxable income to compensate them. Note 4: On May 30, 2014, the North Network was granted with the extension of the right to a 75% reduction of income tax and surcharges until 2023 (SUDAM benefit).

75 of 85


6. Loans and financing

Total gross bank debt at the end of 3Q15 was R$8.3 billion, up 4.3% from 2Q15 and implying a net debt/EBITDA of 4.85x considering an EBITDA of R$1,503.8 million in the last 12 months.

The main transactions during the quarter were the raising of (i) R$196.8 million through a bank credit

note (CCB); (ii) R$72 million (USD 23 million) of Loan Operation 4131; (iii) R$100 million through Export

Credit Note (NCE); and (iv) R$218 million under the FINAME facility. In addition we had total

amortizations of R$384.2 million in FINEM, FINAME, NCE, Debentures and working capital lines.

The 3.0% increase in the net debt balance is due to the net funding in the quarter, as described

above, as well as provision for interest and payments made. All the foreign currency-denominated

debt of Rumo ALL is hedged against exchange variations.

Total Banking Indebtness 3Q15 2Q15 Chg. %

(Amounts in R$ MM)

Commercial Banks 821.7 539.7 52.3%

NCE 864.4 832.1 3.9%

BNDES 3,690.4 3,624.1 1.8%

Debentures 2,935.2 2,970.0 -1.2%

Total Banking Debt 8,311.7 7,965.9 4.3%

Cash and Cash Equivalents and Secutities (948.7) (874.8) 8.5%

Net Derivatives Instruments (68.7) (12.5) n/a

Net Banking Debt 7,294.2 7,078.6 3.0%

EBITDA LTM 1,503.8 1,425.6 5.5%

Leverage (Net Banking Debt / EBITDA LTM) 4.85x 4.97x

The following table is a breakdown of the items that impacted the cash position and consolidated debt transactions of Rumo ALL.

Indebtedness (Amounts in R$ MM)

3Q15

Opening Balance of Gross Debt Rumo ALL (2Q15) 7,965.9

Cash and cash equivalents and marketable securities (2Q15) (874.8)

Bank Net Indebtedness (Net of MTM) (2Q15) 7,091.1

0.0%

Items with impact on cash 11.1

Funding 586.8

Amortization of principal (384.2)

Amortization of interest rates (191.5)

Items without impact on cash 334.7

Provision for interest rates (accrual) 194.0

Monetary variation 1.6

Exchange rate variation 139.0

Closing balance of gross indebtedness (3Q15) 8,311.7

Cash and cash equivalents and marketable securities (3Q15) (948.7)

Closing Balance of Bank Net Debt Rumo ALL (3Q15) 7,363.0

Rumo ALL has covenants in most of its loans and financing agreements, based on specific

financial and non-financial indicators. The financial indicators are: (i) consolidated net bank

debt/EBITDA; (ii) EBITDA/consolidated financial result (considering only interest on debentures,

loans/financing and hedge operations); (iii) shareholders' equity/net assets. We note that item (iii) is

exclusive for BNDES. For all our loans and financing agreements with the exception of BNDES, that

requires annual measurements, we have to calculate all those indicators every quarter as of the date of

the financial statements, using the consolidated results.

As mentioned in ALL's earnings results of December 2014, the net debt/EBITDA covenants were

renegotiated to 5.5 times with all creditors, except with the BNDES. The bank, however, which has until

now only granted consent to the non-compliance with covenants on December 31, 2014 thus far. We are

discussing those covenants with the BNDES, applying to the fiscal year ending on December 31, 2015.

76 of 85


7. Capex

3Q15 3Q14 Chg. %

Investments 9M15 9M14 Chg. %


479.3 406.6 17.9% Total Investments 1,435.3 1,115.8 28.6%

215.1 292.9 -26.6% Recurring 616.7 864.5 -28.7%

264.3 113.7 n/a Expansion 818.7 251.3 n/a

Recurring Capex totaled R$215.1 million, down 26.6% from 3Q14. This reduction is mainly due to the

allocation of approximately R$89 million in rail structure and rolling stock maintenance expenses, which, under the new criteria, are now considered maintenance costs (Opex) in this quarter and were considered as investments (Capex) in 3Q14. Recurring investments are related to maintenance of rolling stock, rail structure and operational technology, whose expected benefits last for more than 12 months. Furthermore, during the quarter, the company carried out maintenance work at the Discharge Grid and the pier coverage at Rumo's terminal in the Port of Santos, besides making improvements to operational safety, quality and environment at the terminals operated by it. In 3Q15, expansion Capex reached R$264.3 million, in line with the 18-month Investment Plan.

The expenses were mainly concentrated in: (i) the purchase of 38 locomotives, already delivered, to renew the North Operations fleet; (ii) the acquisition of 336 bulk freight cars received in 3Q15; and (iii) advances on the purchase of tracks and steel sleepers, with delivery expected for 4Q15.

8. Cash Generation

The following table shows the cash flow in 3Q15 considering the combined cash of Rumo ALL in the

quarter. Securities were considered as cash and cash equivalents in this statement.

Indirect Cash Flows (Amounts in R$ MM)

3Q15

EBITDA 551.6

Non-Cash Effects 51.2

Working Capital Variation (12.4)

Operating Financial Result 7.5

(a) (=) Cash flows from operations 598.0

Total Capex (387.6)

(b) Recurring (215.1)

Expansion

5 (172.5)

(c) (=) Cash flows from investments (387.6)

Funding 586.8

Amortization of principal (528.3)

Amortization of interest rates (237.2)

Restricted cash and derivatives 42.3

(d) (=) Ccash flows from financing (136.4)

(=) Total cash generation (consumption) 74.0

(+) Cash and cash equivalents + marketable securities, opening balance Rumo ALL Combined 874.8

(=) Cash and cash equivalents + marketable securities, closing balance Rumo ALL Combined

948.7

Metrics

(=) Cash generation after recurring Capex (a+ b) 383.0

(=) Cash generation after Total Capex (a+ c) 210.5

(=) Generation (Consumption) total cash (a+c+d) 74.0

Note 5: During the quarter, 12 locomotives were acquired through an operation accounted for as financial lease, totaling R$ 91.7 million

(until September 2015, we acquired 36 locomotives in a total amount of R$ 275.2 through the same operation). Considering this non-

cash effect, the Expansion Capex in the quarter was R$ 264.3 million (R$ 818.7 million in 9M15).

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9. Operational improvements

During 3Q15 we continued the initiatives in our Investment Plan and gains in efficiency are already evident through operational improvements being implemented in our corridors.

Operation of the new GE AC44 locomotives at the Port of Santos

North Operations Our North Operations set new production records in 3Q15. In August, the terminals in the state of

Mato Grosso shipped approximately 1.5 million tons, equivalent to 587 freight cars/day. Worth highlighting is the Rondonópolis terminal, which shipped a record 1.3 million tons of grains in the period, corresponding to an average of 483 freight cars/day. Also in August, we unloaded a record 380 freight cars in a single day at the Port of Santos. In line with our fleet renewal plan, by September 2015 we had received 38 GE AC44 locomotives and 336 HPT bulk freight cars, whose maximum capacity is approximately 110 tons. With the

arrival of the new assets combined with several initiatives for operational improvements, we acquired additional capacity to negotiate additional volume with our clients to attend during the second semester of 2015. We are also continuing implementation of the new renovation standard for freight cars and locomotives, established at the start our investment plan. We reduced the transit time between Rondonópolis and the Port of Santos by 5.4% in the quarter compared with 3Q14. This reduction represents about 5 hours less of transit time between the

departure from Rondonópolis and the arrival at the Port of Santos. The reduction has been benefiting the cycle time of freight cars, which is measured by the number of hours required for freight cars to load at the terminal, unload at the port and return to the terminal for another shipment. With the allocation of more efficient assets and improvements to railroads and terminals, there was a reduction of 17 hours in the cycle time of freight cars (average of 278 hours in 9M14), from 259 hours in 3Q14 to about 242 hours in 3Q15 (average of 260 hours in 9M15). We are continuing improvements to the rail structure, urban stretches and the Freight Car Maintenance Stations (PMV). We reached in September the highest level of rail structure reliability,

thanks to important initiatives, including: (i) the replacement of sleepers in the Rubinéia – Araraquara stretch in São Paulo; and (ii) change of the rail profile in the Boa Vista - Santos stretch in São Paulo, including the access to the Port of Santos, together with heavy infrastructure services in the entire corridor. Apart from these initiatives, we obtained excellent results in operational safety. In urban perimeter areas, we made several improvements such as replacement of damaged sleepers and drainage of the sites.

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Reconstruction of Warehouse X in the Port of Santos

Construction work at Warehouse X in the Port of Santos: Installation of roofing tiles in the warehouse

Improvements to rail structure

BEFORE AFTER Improvement projects in the Port of Santos – right bank (Small bridge on Channel 4)

BEFORE AFTER Improvement projects in the Port of Santos – right bank (L7 Macuco)

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BEFORE AFTER Recovery of railroad – Improvements to the urban stretch in Santa Fé do Sul (SP)

BEFORE AFTER Recovery of railroad – Improvements to the urban stretch in Aldeinha (SP)

BEFORE AFTER Recovery of railroad – Improvements in the urban stretch at Limeira (SP)

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South Operations

Continuing with our fleet renewal plan, in September we received 86 HPE bulk freight cars (of a total of 377 freight cars acquired in the beginning of the year). Each freight car has maximum cargo

capacity of 78 tons, while the previous average per freight car was 66 tons. The cars are already transporting sugar on the stretch connecting the North of Paraná to the Port of Paranaguá, the main corridor of our South Operations. We should begin the operation of the new ES43 BBi locomotive in early 2016. This model was

designed for the meter gauge and is the first locomotive with 8 axles, making it powerful and resistant to steep inclines, narrow tunnels and sharp bends. Already in 2015 we should start tests and training on this asset for drivers and maintenance crews. The model was designed by GE exclusively for the South Corridor, where most of the stretches have narrow gauges. At the Port of Paranaguá, we resumed operations in a major bulk terminal. Work on renovation of

the lines at the terminal, starting from km 5 to the railway loop at the Port and the public silo line, is expected to be completed by the beginning of 2016. These initiatives will increase our unloading capacity to up to 300 freight cars/day, of the terminal’s total capacity of 450 of freight cars/day. The renovation work in progress also includes extension of lines and replacement of tracks and sleepers in the urban perimeter areas of Maringá and Londrina, in order to improve circulation in these stretches.

Improvements in the Port of Paranaguá

BEFORE AFTER

BEFORE AFTER Remodeling of railroads in an important bulk terminal in the Port of Paranaguá

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Photos of the renewed stretch of the Port of Paranaguá (PR)

10. Guidance

This section contains the guidance ranges of some of the main parameters affecting the consolidated

results of Rumo ALL for 2015. Please note that other sections of this Earnings Release may contain

projections too. Those projections and guidance are mere estimates and indications, and should not be

taken as a guarantee of future results.

2015

2015 2Q15 Updated

6

Rumo ALL

EBITDA (R$ MM) 1,600 ≤ ∆ ≤ 2.000 1.750 ≤ ∆ ≤ 2.000

Total Capex (R$ MM) 1.600 ≤ ∆ ≤ 1.900 1.700 ≤ ∆ ≤ 1.900

Capex Recurring (R$ MM) 800 ≤ ∆ ≤ 1.000 800 ≤ ∆ ≤ 900

Capex Expansion (R$ MM) 800 ≤ ∆ ≤ 900 900 ≤ ∆ ≤ 1.000

Note 6: There was no change in the guidance since the revision made in 2Q15.

Disclaimer

This document contains forward-looking statements and information. These forward-looking statements and

information are solely forecasts and are not guarantees of future performance. All stakeholders are advised that these

forward-looking statements and information are and will be, as applicable, subject to risks, uncertainties and factors

related to the operations and business environment of Cosan and its subsidiaries, and hence actual results of these

companies could differ significantly from the future results expressed or implied by said forward-looking statements and

information.

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11. Appendices 11.1 Financial Statements of Rumo ALL

11.1.1 Balance Sheet Balance Sheet 06.30.2015 09.30.2015

(Amounts in R$ MM) Rumo ALL Rumo ALL

Current

Cash and cash equivalents 340.3 69.7

Securities 534.4 879.0

Trade receivables 157.0 185.6

Inventories 106.8 190.9

Peer company receivables 20.2 24.9

Income tax and social contribution 42.4 22.3

Other taxes recoverable 312.0 234.4

Dividends and interest on capital - -

Other assets 86.2 81.3

1,599.3 1,688.1

Non-current


Restricted cash 148.3 92.6

Deferred income tax and social contribution 1,344.7 1,380.3



Judicial deposits 357.5 345.6

Derivative financial instruments 13.9 81.0


Investments 41.1 45.3

Property and equipment 8,813.9 9,122.4

Intangible 7,801.4 7,784.8

19,385.4 19,814.3

Total Assets 20,984.7 21,502.4

Current

Borrowings 1,094.3 1,398.9

Leases 443.4 537.0

Advances on real estate credits 143.3 108.7


Trade accounts payable 701.8 745.9

Labor and social security obligations 134.4 170.8

Taxes and social security contributions payable 11.8 9.3

Other payable taxes 25.8 27.8

Leases and concessions 19.3 19.5

Dividends and interest on capital 8.3 8.2

Related parts 16.7 85.1

Tax installments - -

Deferred revenue 107.3 107.3

Other payables 195.4 192.5

2,903.2 3,423.3

Non - current

Borrowings 6,871.5 6,912.8

Leases 1,350.3 1,286.6


Derivative financial instruments 24.3 -

Leases and concessions 2,030.2 2,114.4

Provision for lawsuits 569.4 561.6

Taxes and social security contributions payable 2,714.8 2,720.3

Deferred income tax and social contribution 19.6 -



14,027.6 14,074.3

Equity 4,053.8 4,004.8

Total Liabilities 20,984.6 21,502.4

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11.1.2 Income Statement 3Q15 3Q14

Chg. % Consolidated 9M15 9M14

Chg. %

Combined (Amounts in R$ MM) Combined Combined 1,357.7 1,111.1 22,2% Net Operating Revenue 3,548.2 3,247.8 9.2%

436.3 401.3 8.7% Gross profit 1,158.1 1,230.8 -5.9%

(95.2) (67.2) 41.6% Sales, General and Administrative Expenses (278.1) (226.0) 23.0%

11.1 16.4 -31.9% Other Operating Income (Expenses), Net 21.1 18.1 16.4%

(399.4) (266.3) 50.0% Net financial result (1,064.1) (825,8) 28.9%

4.1 5.5 -25.7% Equity Pickup 3.6 10.5 -65.5%

1.9 (17.6) n/a Income Tax and Social Contribution (69.4) (31.1) n/a

(2.6) (3.9) -33.6% Discontinued Operations (8.7) (8.8) -0.6%

(43.7) 68.2 n/a Net Profit (losses) (237.5) 167.6 n/a

11.1.3 Cash Flow Cash Flow (Accounting) Rumo ALL

(Amounts in R$ MM) 3Q15 3Q14 9M15 9M14


Profit before income tax and social contribution (43.0) 57.7 50.6 139.7

Adjustments:

Depreciation and amortization 195.3 25.7 398.9 70.4

Equity (4.1) - (4.3) -

Provision for interest in the results of investees 24.0 3.5 45.0 6.6

Gain on disposal of declared dividends 2.7 - 3.5 0.0

Loss (gaing) on disposal of permanent assets (46.4) 0.6 (40.1) 1.0

Provision (reversal) for losses on doubtful accounts (0.4) - 0.4 (0.7)

Others 82.2 - 97.0 -

Interest, monetary and exchange variations, net 407.0 10.7 767.9 29.8

617.2 98.1 1,318.9 246.8

Variation in:

Accounts receivable 1.3 (79.5) (39.7) (150.8)

Advances from customers 7.1 (2.6) (13.7) (0.1)

Judicial deposits 13.5 (0.4) (2.7) (20.7)

Related parties 181.0 0.8 150.8 11.3

Taxes and contributions recoverable 4.0 11.8 0.7 3.4

Taxes and contributions payable (18.1) (13.8) (43.3) (42.6)

Inventories (64.4) (0.8) (81.1) (0.9)

Labor and social security obligations 12.4 1.4 7.8 (2.8)

Trade accounts payable (96.7) 31.4 (82.2) 31.9

Advances to suppliers (8.1) 0.1 (34.1) (0.1)

Contingencies (8.4) (0.5) (13.9) (0.9)

Other assets and liabilities, net (43.0) (2.4) (68.9) (22.3)

(19.3) (54.5) (220.3) (194.4)

Cash generated by (used in) operations 597.9 43.6 1,098.5 52.4


Addition to property, software and other intangibles (387.6) (85.6) (890.2) (183.3)

Securities (344.6) - (161.4) -

Restricted cash 55.7 - 130.4 -

Net cash acquired in business acquisition - - 169.7 -

Cash generated by (used in) investing activities (676.5) (85.6) (751.4) (183.3)


Borrowings 586.8 80.0 2,537.9 87.6

Payment of borrowings (528.3) (27.8) (2,053.6) (76.8)

Payment of interest on borrowings (237.2) (10.9) (553.4) (30.8)

Derivative financial instruments (11.9) - 7.7 -

Dividends payable (1.5) (125.0) (301.5) (250.0)

Cash generated by (used in) financing activities (192.1) (83.6) (362.9) (270.1)

Increase (decrease) in cash and cash equivalents (270.6) (125.6) (15.8) (401.0)

Beginning balance of cash and cash equivalents 340.3 222.4 85.5 497.8

Final balance of cash and cash equivalents 69.7 96.8 69.7 96.8

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11.2 Financial Statements of Cosan Logística 11.2.1 Balance Sheet Balance Sheet Cosan Logística

(Amounts in R$ MM) 3Q15 2Q15

Current

Cash and cash equivalents 240.6 508.5

Securities 879.0 534.4


Inventories 190.9 106.8

Peer company receivables 24.9 20.2



Dividends and interest on capital - -


1,864.6 1,768.4

Non-current


Restricted cash 92.6 148.3




Judicial deposits 345.6 357.5



Investments 45.3 41.1

Property and equipment 9,122.4 8,813.9

Intangible 7,784.8 7,801.4

19,815.2 19,385.4

Total Assets 21,679.9 21,153.8

Current

Borrowings 1,398.9 1,094.3

Leases 537.0 443.4



Trade accounts payable 745.9 701.8

Labor and social security obligations 170.8 134.4


Other payable taxes 27.9 25.8

Dividends and interest on capital 8.4 8.6

Leases and concessions 19.5 19.3

Related parts 85.2 16.7



3,430.7 2,903.6

Non - current

Borrowings 6,912.8 6,871.5

Leases 1,286.6 1,350.3


Derivative financial instruments - 24.3


Provision for lawsuits 561.6 569.4

Leases and concessions 2,114.4 2,030.2




14,074.3 14,027.6

Equity 4,174.9 4,222.6

Total Liabilities 21,679.9 21,153.8

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11.2.2 Income Statement

3Q15 3Q14 Chg. % Cosan Logística Consolidado

9M15 9M14 Chg. % (Amouts in R$ MM)

1,357.7 261.3 n/a Net Operating Revenue 2,783.6 659.7 n/a

436.4 80.6 n/a Gross profit 949.9 226.9 n/a

(98.7) (20.9) n/a Sales, General and Administrative Expenses (207.9) (63.6) n/a

11.2 1.0 n/a Other Operating Income (Expenses), Net 50.6 18.1 n/a

(394.1) (3.1) n/a Net financial result (737.5) (23.1) n/a

4.1 - - Equity Pickup 4.3 - -

1.3 (19.3) n/a Income Tax and Social Contribution (50.1) (47.0) 6.6%

(2.6) - - Discontinued Operations (6.2) - -

(42.6) 38.3 n/a Net Profit (losse) 2.9 111.3 -97.4%

11.2.3 Cash Flow Cash Flow Cosan Logística

(Amounts in R$ MM) 3Q15 3Q14 9M15 9M14


Profit before income tax and social contribution (41.3) 57.7 59.3 158.3

Adjustments:

- -

Depreciation and amortization 195.3 25.7 398.9 70.4

Equity (4.1) - (4.3) -

Stock option 0.2 - 0.6 -

Provision for interest in the results of investees 24.0 3.5 45.0 6.6

Gain on disposal of declared dividends - - - (18.6)

Loss (gaing) on disposal of permanent assets 2.7 - 3.5 0.0

Provision for lawsuits (1.5) 0.6 4.8 1.0

Provision (reversal) for losses on doubtful accounts (0.4) - 0.4 (0.7)

Others 40.1 - 54.9 -

Interest, monetary and exchange variations, net 407.0 10.7 767.9 29.8

622.0 98.1 1,330.9 246.8

Variation in:

- -

Accounts receivable 0.3 (79.5) (39.7) (150.8)

Advances from customers 7.1 (2.6) (13.7) (0.1)

Judicial deposits 13.5 (0.4) (2.7) (20.7)

related parties 33.4 0.8 14.2 11.3

Taxes and contributions recoverable (0.7) 11.8 (5.0) 3.4

Taxes and contributions payable (15.5) (13.8) (43.2) (42.6)

Inventories (64.4) (0.8) (81.1) (0.9)

Labor and social security obligations 12.4 1.4 7.8 (2.8)

Suppliers 52.1 31.4 54.6 31.9

Advances to suppliers (8.1) 0.1 (34.1) (0.1)

Contingencies (8.4) (0.5) (13.9) (0.9)

Other assets and liabilities, net (43.0) (2.4) (68.9) (22.3)

(21.4) (54.5) (225.7) (194.4)

Cash generated by (used in) operations 600.6 43.6 1,105.2 52.4

- -


- -

Addition to property, software and other intangibles (387.6) (85.6) (890.2) (183.3)

Securities (344.6) - (161.4) -

Restricted cash 55.7 - 130.4 -

Acquisitions, net of cash acquired - - 144.6 -

Cash generated by (used in) investing activities (676.5) (85.6) (776.5) (183.3)

- -


- -

Borrowings 586.8 80.0 2,537.9 87.6

Payment of borrowings (528.3) (27.8) (2,053.6) (76.8)

Payment of interest on borrowings (237.2) (10.9) (553.4) (30.8)

Derivative financial instruments (11.9) - 7.7 -

Capital increase - 1.0 - 1.0

Dividends payable (1.5) (125.0) (101.0) (250.0)

Purchase of treasury shares - - (12.2) -

Cash generated by (used in) financing activities (192.1) (82.6) (174.6) (269.1)

- -

Increase (decrease) in cash and cash equivalents (267.9) (124.6) 154.1 (400.0)

- -

Beginning balance of cash and cash equivalents 340.3 222.4 86.5 497.8

Final balance of cash and cash equivalents 72.4 97.8 240.6 97.8

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