sbspr2q15_6k.htm - Generated by SEC Publisher for SEC Filing
 
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
 

 
FORM 6-K
 
REPORT OF FOREIGN ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 OF THE
SECURITIES EXCHANGE ACT OF 1934
 
For August 13, 2015
(Commission File No. 1-31317)
 

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


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



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

Form 20-F ___X___ Form 40-F ______
Indicate by check mark if the registrant is submitting the Form 6-K
in paper as permitted by Regulation S-T Rule 101(b)(1)__.
Indicate by check mark if the registrant is submitting the Form 6-K
in paper as permitted by Regulation S-T Rule 101(b)(7)__.

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

Yes ______ No ___X___

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

 

 

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

 

 

SABESP announces 2Q15 results

São Paulo, August 13, 2015 - Companhia de Saneamento Básico do Estado de São Paulo - SABESP (BM&FBovespa: SBSP3; NYSE: SBS), one of the largest water and sewage services providers in the world based on the number of costumers, announces today its results for the second quarter of 2015 (2Q15). The Company’s operating and financial information, except when indicated otherwise is presented in Brazilian Reais, in accordance with the Brazilian Corporate Law. All comparisons in this release, unless otherwise stated, refer to the same period of 2014.

SBSP3: R$ 15.47/share
SBS: US$ 4.33 (ADR=1 share)
Total shares: 683,509,869
Market value: R$ 10.6 billion
Closing quote: 08/13/2015

 


 

 

 

 

 

R$ million

 

 

 


 
 

 

1.    Financial highlights

               

R$ million

 

2Q15

2Q14

Chg. (R$)

%

1H15

1H14

Chg. (R$)

%

(+) Gross operating revenue

2,047.2

2,224.0

(176.8)

(7.9)

4,051.7

4,668.4

(616.7)

(13.2)

(+) Construction revenue

904.8

678.7

226.1

33.3

1,493.2

1,210.0

283.2

23.4

(-) COFINS and PASEP taxes

129.1

148.6

(19.5)

(13.1)

253.4

332.3

(78.9)

(23.7)

(=) Net operating revenue

2,822.9

2,754.1

68.8

2.5

5,291.5

5,546.1

(254.6)

(4.6)

(-) Costs and expenses

1,465.1

1,650.8

(185.7)

(11.2)

2,254.3

3,166.4

(912.1)

(28.8)

(-) Construction costs

885.2

664.2

221.0

33.3

1,461.6

1,184.7

276.9

23.4

(+) Equity result

(0.1)

-

(0.1)

-

1.0

(0.3)

1.3

(433.3)

(+) Other operating revenue/expenses, net

11.7

5.2

6.5

125.0

43.8

(37.8)

81.6

(215.9)

(=) Earnings before financial result, income tax and social contribution

484.2

444.3

39.9

9.0

1,620.4

1,156.9

463.5

40.1

(+) Financial result

155.4

(21.6)

177.0

(819.4)

(830.3)

5.9

(836.2)

n.m.

(=) Earnings before income tax and social contribution

639.6

422.7

216.9

51.3

790.1

1,162.8

(372.7)

(32.1)

(-) Income tax and social contribution

302.3

120.3

182.0

151.3

134.6

382.8

(248.2)

(64.8)

Net Income

337.3

302.4

34.9

11.5

655.5

780.0

(124.5)

(16.0)

Earnings per share* (R$)

0.49

0.44

 

 

0.96

1.14

 

 

* Total shares = 683,509,869

               

 

Adjusted EBITDA Reconciliation (Non-accounting measures)

               

R$ million

 

2Q15

2Q14

Chg. (R$)

%

1H15

1H14

Chg. (R$)

%

Net income

337.3

302.4

34.9

11.5

655.5

780.0

(124.5)

(16.0)

(-) Income tax and social contribution

302.3

120.3

182.0

151.3

134.6

382.8

(248.2)

(64.8)

(+) Financial result

(155.4)

21.6

(177.0)

(819.4)

830.3

(5.9)

836.2

n.m.

(+) Other operating revenues/expenses, net

(11.7)

(5.2)

(6.5)

125.0

(43.8)

37.8

(81.6)

(215.9)

(=) Adjusted EBIT*

472.5

439.1

33.4

7.6

1,576.6

1,194.7

381.9

32.0

(+) Depreciation and amortization

284.1

222.6

61.5

27.6

537.4

482.9

54.5

11.3

(=) Adjusted EBITDA **

756.6

661.7

94.9

14.3

2,114.0

1,677.6

436.4

26.0

(%) Adjusted EBITDA margin

26.8

24.0

 

 

40.0

30.2

 

 


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

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

 

In 2Q15, net operating revenue, including construction revenue, reached R$ 2.8 billion; a 2.5% increase compared to 2Q14.

Costs and expenses, including construction costs, totaled R$ 2.4 billion, up by 1.5% compared to R$ 2.3 billion recorded in 2Q14.

Adjusted EBIT, in the amount of R$ 472.5 million, grew 7.6% from R$ 439.1 million recorded in the same quarter of the previous year.

Adjusted EBITDA, in the amount of R$ 756.6 million, increased 14.3% from R$ 661.7 million recorded in 2Q14 (R$ 3,355.1 million in the last 12 months).

The adjusted EBITDA margin was 26.8% in 2Q15, versus 24.0% in 2Q14 (30.6% in the last 12 months). Excluding construction revenues and construction costs, the adjusted EBITDA margin was 38.4% in 2Q15 (31.2% in 2Q14 and 42.4% in the last 12 months).

Net income totaled R$ 337.3 million, 11.5% higher than R$ 302.4 million recorded in 2Q14.

 

2. Gross operating revenue

Gross operating revenue from water and sewage, not including construction revenue, totaled R$ 2.0 billion, a drop of R$ 176.8 million or 7.9%, when compared to the R$ 2.2 billion recorded in 2Q14.

The main factors that led to this variation were:

·         Bonus granted within the Water Consumption Reduction Incentive Program, with a R$ 231.0 million impact in 2Q15, versus the R$ 88.1 million granted in 2Q14, leading to a decrease of 6.4% in gross operating revenue;

·         Decrease of 7.5% in the Company’s total billed volume (8.3% in water and 6.3% in sewage); and

·         Decrease in the average billed price, due to the migration of clients to lower volume of consumption ranges.

 

The decline in gross operating revenue was mitigated by the application of contingency tariff, in the amount of R$ 123.0 million, and by the application of the following adjustments:

 

Page 2 of 11


 
 

 

·         6.5% repositioning tariff index since December 2014; and

 

·         15.2% tariff increase (7.8% ordinary tariff adjustment and 6.9% Extraordinary Tariff Revision) since June 2015, with a 1.5% impact in the quarter.

 

3. Construction revenue

Construction revenue increased R$ 226.1 million or 33.3%, when compared to 2Q14. The variation was mainly due to higher investments in 2Q15.


4. Billed volume

 

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

 

                   

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

 

 

Water

 

 

Sewage

 

Water + Sewage

 

Category

2Q15

2Q14

%

2Q15

2Q14

%

2Q15

2Q14

%

Residential

358.0

382.0

(6.3)

301.3

319.2

(5.6)

659.3

701.2

(6.0)

Commercial

39.4

42.7

(7.7)

37.5

40.3

(6.9)

76.9

83.0

(7.3)

Industrial

8.0

9.9

(19.2)

9.7

10.9

(11.0)

17.7

20.8

(14.9)

Public

10.7

13.3

(19.5)

8.4

10.3

(18.4)

19.1

23.6

(19.1)

Total retail

416.1

447.9

(7.1)

356.9

380.7

(6.3)

773.0

828.6

(6.7)

Wholesale

52.4

63.1

(17.0)

5.9

6.6

(10.6)

58.3

69.7

(16.4)

Total

468.5

511.0

(8.3)

362.8

387.3

(6.3)

831.3

898.3

(7.5)

 

1H15

1H14

%

1H15

1H14

%

1H15

1H14

%

Residential

727.0

792.6

(8.3)

609.9

659.5

(7.5)

1,336.9

1,452.1

(7.9)

Commercial

79.9

87.7

(8.9)

75.6

82.3

(8.1)

155.5

170.0

(8.5)

Industrial

16.5

20.1

(17.9)

19.6

22.0

(10.9)

36.1

42.1

(14.3)

Public

21.2

27.1

(21.8)

16.5

20.9

(21.1)

37.7

48.0

(21.5)

Total retail

844.6

927.5

(8.9)

721.6

784.7

(8.0)

1,566.2

1,712.2

(8.5)

Wholesale

105.7

138.5

(23.7)

12.4

13.1

(5.3)

118.1

151.6

(22.1)

Total

950.3

1,066.0

(10.9)

734.0

797.8

(8.0)

1,684.3

1,863.8

(9.6)

                   

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

 

Water

 

 

Sewage

 

 

Water + Sewage

 

Region

2Q15

2Q14

%

2Q15

2Q14

%

2Q15

2Q14

%

Metropolitan

267.1

292.8

(8.8)

231.7

251.2

(7.8)

498.8

544.0

(8.3)

Regional (2)

149.0

155.1

(3.9)

125.2

129.5

(3.3)

274.2

284.6

(3.7)

Total retail

416.1

447.9

(7.1)

356.9

380.7

(6.3)

773.0

828.6

(6.7)

Wholesale

52.4

63.1

(17.0)

5.9

6.6

(10.6)

58.3

69.7

(16.4)

Total

468.5

511.0

(8.3)

362.8

387.3

(6.3)

831.3

898.3

(7.5)

 

1H15

1H14

%

1H15

1H14

%

1H15

1H14

%

Metropolitan

535.0

601.9

(11.1)

462.6

514.1

(10.0)

997.6

1,116.0

(10.6)

Regional (2)

309.6

325.6

(4.9)

259.0

270.6

(4.3)

568.6

596.2

(4.6)

Total retail

844.6

927.5

(8.9)

721.6

784.7

(8.0)

1,566.2

1,712.2

(8.5)

Wholesale

105.7

138.5

(23.7)

12.4

13.1

(5.3)

118.1

151.6

(22.1)

Total

950.3

1,066.0

(10.9)

734.0

797.8

(8.0)

1,684.3

1,863.8

(9.6)

(1) Unaudited

(2) Including coastal and interior region

 

 

Page 3 of 11


 
 

 

5. Costs, administrative and selling expenses

In 2Q15, costs, administrative and selling expenses, grew 1.5% (R$ 35.3 million). Excluding construction costs, total costs and expenses dropped 11.2%. As a percentage of net revenue, cost and expenses were 84.1% in 2Q14 and 83.3% in 2Q15.

               

R$ million

 

2Q15

2Q14

Chg. (R$)

%

1H15

1H14

Chg. (R$)

%

Payroll and benefits

528.8

551.4

(22.6)

(4.1)

1,063.4

1,048.1

15.3

1.5

Supplies

43.1

46.9

(3.8)

(8.1)

91.7

94.1

(2.4)

(2.6)

Treatment supplies

63.6

64.6

(1.0)

(1.5)

135.9

134.3

1.6

1.2

Services

270.0

351.6

(81.6)

(23.2)

566.0

666.2

(100.2)

(15.0)

Electric power

208.3

144.5

63.8

44.2

367.4

284.5

82.9

29.1

General expenses

48.7

190.0

(141.3)

(74.4)

103.1

342.7

(239.6)

(69.9)

Tax expenses

18.3

17.6

0.7

4.0

38.2

37.3

0.9

2.4

São Paulo state government reimbursement

-

-

-

-

(696.3)

-

(696.3)

-

Sub-total

1,180.8

1,366.6

(185.8)

(13.6)

1,669.4

2,607.2

(937.8)

(36.0)

Depreciation and amortization

284.1

222.6

61.5

27.6

537.4

482.9

54.5

11.3

Credit write-offs

0.2

61.6

(61.4)

(99.7)

47.5

76.3

(28.8)

(37.7)

Sub-total

284.3

284.2

0.1

0.0

584.9

559.2

25.7

4.6

Costs and expenses

1,465.1

1,650.8

(185.7)

(11.2)

2,254.3

3,166.4

(912.1)

(28.8)

Construction costs

885.2

664.2

221.0

33.3

1,461.6

1,184.7

276.9

23.4

Costs, adm., selling and construction expenses

2,350.3

2,315.0

35.3

1.5

3,715.9

4,351.1

(635.2)

(14.6)

% of net revenue

83.3

84.1

 

 

70.2

78.5

 

 

 

 

5.1. Payroll and benefits

 

In 2Q15 payroll and benefits dropped R$ 22.6 million or 4.1%, due to the following:

 

·         R$ 15.9 million in provisions for severance payments (TAC); and

·         R$ 10.7 million in expenses related to the Profit Sharing Program, due to a higher reversion of provision in 2Q15, as a result of achievements lower than the targets estimated for the period.

The average wage increase of 6.8%, since May 2014 and of 9.7% since May 2015 were offset by the 4.4% drop in the number of employees, that reduced from 14,799 in 2Q14 to 14,147 this quarter.

 

5.2. Supplies

 

In 2Q15, expenses with supplies decreased R$ 3.8 million or 8.1%, from R$ 46.9 million to R$ 43.1 million, mostly due to lower use of materials in preventive and corrective maintenance in several water and sewage systems, thus, resulting in a reduction of R$ 3.0 million.

 

5.3. Services

 

Services expenses, in the amount of R$ 270.0 million, dropped R$ 81.6 million or 23.2%, in comparison to R$ 351.6 million in 2Q14. The main factors were:

·         Advertising campaigns, in the amount of R$ 38.3 million, mainly due to the intensification in 2Q14, for the rational use of water;

·         Estimate of service expenses, totaling R$ 22.1 million, especially due to the lower expense related to advertising campaigns in 2Q15; and

·         Expenses with risk contracts for credit recovery, in the amount of R$ 7.8 million.

 

5.4. Electric power

 

Electric power expenses totaled R$ 208.3 million, an increase of R$ 63.8 million or 44.2% in comparison to the R$ 144.5 million in 2Q14, chiefly due to the following:

·         Average increase of 82.0% in the regulated market tariffs (ACR), with a 10.3% decrease in consumption; and

·         Average increase of 210.4% in the grid market tariffs (TUSD).

 

Page 4 of 11


 
 

The regulated market (ACR) accounts for 69.2% of the total electric power consumed by the Company, while the grid market represents 11.5% of total consumption.


5.5. General expenses

 

General expenses dropped R$ 141.3 million or 74.4%, totaling R$ 48.7 million, versus the R$ 190.0 million recorded in 2Q14 mainly due to:

·         R$ 117.8 million decrease in the provision for lawsuits; and

·         Lower provision for the Municipal Fund for Environmental Sanitation and Infrastructure, in the amount of R$ 13.3 million, as a result of the decrease in revenues with the municipality of São Paulo.

 

5.6. Depreciation and amortization

 

R$ 61.5 million increase or 27.6%, reaching R$ 284.1 million in comparison to the R$ 222.6 million recorded in 2Q14, mostly related to the addition intangible assets in operation.

 

 

5.7. Credit write-offs

 

Credit write-offs decreased R$ 61.4 million, especially due to higher allowance for losses occurred in 2Q14, in municipalities served with water on wholesale basis.

 

 

6. Other operating revenues and expenses, net

 

Other net operational revenues and expenses reported an upturn of R$ 6.5 million, mainly due to the gain from selling surplus energy in 2Q15, in the amount of R$ 9.7 million.

 

 

 

7. Financial result

 

       

R$ million

 

2Q15

2Q14

Chg.

%

Financial expenses, net of revenues

(64.5)

(74.4)

9.9

(13.3)

Net monetary and exchange variation

219.9

52.8

167.1

316.5

Financial result

155.4

(21.6)

177.0

(819.4)

 

7.1. Financial revenues and expenses      

 

       

R$ million

 

2Q15

2Q14

Chg.

%

Financial expenses

 

 

 

 

Interest and charges on international loans and financing

(25.1)

(23.1)

(2.0)

8.7

Interest and charges on domestic loans and financing

(81.0)

(79.9)

(1.1)

1.4

Other financial expenses

(48.9)

(45.3)

(3.6)

7.9

Total financial expenses

(155.0)

(148.3)

(6.7)

4.5

Financial revenues

90.5

73.9

16.6

22.5

Financial expenses net of revenues

(64.5)

(74.4)

9.9

(13.3)

 

 

7.1.1. Financial expenses

 

Financial expenses grew R$ 6.7 million. The main reasons were:

 

·         R$ 3.3 million upturn in other financial expenses, mainly due to the increased recognition of interest arising from the startup of a sewage treatment station, financed through leasing; and
 

 

 

Page 5 of 11


 
 

·         R$ 2.0 million increase in interest and charges on international loans and financing, especially due to the total debt increase, resulting from new funding.

 

7.1.2. Financial revenues

 

Financial revenues increased R$ 16.6 million, due to interest mainly over instalment agreement in 2Q15.

 

7.2. Monetary and exchange rate variation on assets and liabilities

 

       

R$ million

 

2Q15

2Q14

Chg.

%

Currency exchange variation on loans and financing

208.9

84.2

124.7

148.1

Monetary variation on loans and financing

(41.6)

(28.9)

(12.7)

43.9

Other monetary variations

17.8

(13.1)

30.9

(235.9)

Monetary/exchange rate variation on liabilities

185.1

42.2

142.9

338.6

Monetary/exchange rate variation on assets

34.8

10.6

24.2

228.3

Monetary/exchange rate variation, net

219.9

52.8

167.1

316.5

 

 

7.2.1. Monetary/currency exchange variation on liabilities

 

The effect on the monetary/currency exchange variation on liabilities in 2Q15 was R$ 142.9 million, higher than in 2Q14, especially due to:

 

·         An increase of R$ 124.7 million in expenses with exchange rate change on loans and financing, due to a higher depreciation of the US dollar and the Yen versus the Brazilian Real in 2Q15 (3.3% and 5.0%, respectively), when compared to the depreciation recorded in 2Q14 (2.7% and 1.0%, respectively);

·         R$ 30.9 million decrease in other monetary variation expenses, chiefly due to the reversion of R$ 25.6 million regarding provision for lawsuits in 2T15; and

·         An upturn of R$ 12.7 million in expenses with monetary variation on loans and financing, due to the increase in the IPCA in 2Q15 compared to 2Q14 (2.26% and 1.54%, respectively).

 

7.2.2. Monetary/Exchange rate variation on assets

 

R$ 24.2 million increase, mainly due to the monetary updates on judicial deposits.


8. Income tax and social contribution

Recorded a R$ 182.0 million upturn, due to the increase in taxable income in 2Q15 and to the impacts of deferred income tax and social contribution, versus 2Q14.

 

9. Indicators



 

9.1. Operating

 

As a result of the water crisis, there was a substantial reduction in the water production volume, down by 14.6% in the quarter and 18.1% in the semester.

 

There was also a substantial decline in the index that measures water losses per connection per day (IPDT) which came to 272 liters/connection x day versus 356 liters/connection x day on the same period last year.

 

This reduction was the result not only of loss control initiatives, but also of the water crisis and the consequent need to reduce the network pressure as a demand management mechanism.

.

 

Page 6 of 11


 
 

 

 

 

Operating indicators *

2Q15

2Q14

%

Water connections (1)

8,310

8,100

2.6

Sewage connections (1)

6,753

6,542

3.2

Population directly served - water (2)

25.4

25.1

1.2

Population directly served - sewage (2)

22.6

22.1

2.3

Number of employees

14,147

14,799

(4.4)

Water volume produced - quarter (3)

606

710

(14.6)

Water volume produced - semester (3)

1,219

1,488

(18.1)

IPM - Measured water loss (%)

28.5

30.8

(7.5)

IPDt (liters/connection x day)

272

356

(23.6)

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

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

(3)        In millions of cubic meters

(*)      Unaudited

 

 

9.2. Financial

 

Economic Indexes * (quarter end)

2Q15

2Q14

Amplified Consumer Price Index (IPCA) - %

2.26

1.54

Referential Rate (TR) - %

0.40

0.15

Interbank Deposit Certificate (CDI) - %

13.64

10.80

US DOLAR (R$)

3.1026

2.2025

YEN (R$)

0.02541

0.0218

(*)     Unaudited

 

10. Loans and financing

 

On June 24, 2015, the Company fully redeemed the 16th debenture issue, totaling R$ 500 million. No premium was paid.

 

               

R$ million

INSTITUTION

2015

2016

2017

2018

2019

2020

2021 and onwards

Total

Local market

 

 

 

 

 

 

 

 

Caixa Econômica Federal

34.1

71.8

76.3

80.6

84.0

87.6

741.8

1,176.2

Debentures

61.6

359.5

883.7

595.2

685.7

380.2

575.2

3,541.1

BNDES

27.0

68.8

73.8

73.7

73.7

56.1

286.7

659.8

Commercial Leasing

5.9

19.5

20.6

21.7

23.0

25.1

387.9

503.7

Others

0.3

0.6

0.7

0.6

-

-

-

2.2

Interest and charges

57.0

29.4

-

-

-

-

-

86.4

Local market total

185.9

549.6

1,055.1

771.8

866.4

549.0

1,991.6

5,969.4

International market

 

 

 

 

 

 

 

 

BID

59.2

118.4

172.1

94.2

94.2

94.2

1,085.2

1,717.5

BIRD

-

-

-

-

4.7

9.5

127.7

141.9

Eurobonds

-

434.2

-

-

-

1,081.4

-

1,515.6

JICA

27.8

55.6

56.6

57.6

83.3

83.3

951.1

1,315.3

BID 1983AB

-

74.3

74.3

74.0

54.9

54.2

70.6

402.3

Interest and charges

29.4

-

-

-

-

-

-

29.4

International market total

116.4

682.5

303.0

225.8

237.1

1,322.6

2,234.6

5,122.0

Total

302.3

1,232.1

1,358.1

997.6

1,103.5

1,871.6

4,226.2

11,091.4

 

 

Page 7 of 11


 
 

 

11. Capex

 

In the second quarter of 2015 R$ 969.6 million were invested, totaling R$ 1.5 billion investments in the first six months of 2015.

 

12. Conference calls

 

 

In Portuguese

August 18, 2015

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

Dial in: 55 (11) 3728-5971 ou

55 (11) 3127-4971

Code: Sabesp

 

Replay available for 7 days

Dial in: 55 (11) 3127-4999

Code: 60830050

 

Click here to access the webcast

 

 

In English

August 18, 2015

2:00 pm (Brasília) / 1:00 pm (US EST)

Dial in: 1 (412) 317-6776

Code: Sabesp

 

 

Replay available for 7 days

Dial in: 1(412) 317-0088

Code: 10067911

 

Click here to access the webcast

 

 

 

 

For more information, please contact:

 

Mario Arruda Sampaio

Phone.(55 11) 3388-8664

E-mail: maasampaio@sabesp.com.br

 

Angela Beatriz Airoldi                                                                         

Phone.(55 11) 3388-8793

E-mail: abairoldi@sabesp.com.br

 

 

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

 

Page 8 of 11


 
 

 

Income Statement

 

Brazilian Corporate Law

 

R$ '000

 

2Q15

2Q14

Gross Operating Revenue

2,952,002

2,902,766

Water Supply - Retail

1,116,535

1,148,197

Water Supply - Wholesale

11,261

59,220

Sewage Collection and Treatment

880,702

973,299

Sewage Collection and Treatment - Wholesale

4,816

6,883

Construction Revenue - Water

551,489

280,864

Construction Revenue - Sewage

353,271

397,886

Other Services

33,928

36,417

Taxes on Sales and Services - COFINS and PASEP

(129,150)

(148,613)

Net Operating Revenue

2,822,852

2,754,153

Operating Costs

(2,105,409)

(1,830,133)

Gross Profit

717,443

924,020

Operating Expenses

 

 

Selling

(146,971)

(215,232)

Administrative

(97,932)

(269,704)

Other operating revenue (expenses), net 

11,777

5,209

Operating Income Before Shareholdings 

484,317

444,293

Equity Result 

(115)

49

Earnings Before Financial Results, net

484,202

444,342

Financial, net

(53,569)

(105,534)

Exchange gain (loss), net

208,961

83,957

Earnings before Income Tax and Social Contribution

639,594

422,765

Income Tax and Social Contribution

 

 

Current

(225)

(135,474)

Deferred

(302,054)

15,131

Net Income (loss) for the period

337,315

302,422

Registered common shares ('000)

683,509

683,509

Earnings per shares - R$ (per share)

0.49

0.44

Depreciation and Amortization

(284,087)

(222,594)

Adjusted EBITDA

756,512

661,727

% over net revenue

26.8%

24.0%

 

 

Page 9 of 11


 
 

Balance Sheet

 

Brazilian Corporate Law

 

R$ '000

ASSETS

06/30/2015

12/31/2014

Current assets

 

 

Cash and cash equivalents

803,031

1,722,991

Trade accounts receivable

1,144,774

1,034,820

Accounts receivable from related parties

128,407

121,965

Inventories

55,330

66,487

Restricted cash

20,171

19,750

Recoverable taxes

112,331

148,768

Other accounts receivable

199,222

100,664

Total current assets

2,463,266

3,215,445

 

 

 

Noncurrent assets

 

 

Trade accounts receivable

165,243

189,458

Accounts receivable from related parties

689,267

102,018

Escrow deposits

81,614

69,488

Deferred income tax and social contribution

75,100

209,478

Water National Agency – ANA

127,855

122,634

Other accounts receivable

81,319

87,286

 

 

 

Investments

24,134

21,223

Investment properties

61,549

54,039

Intangible assets

27,043,222

25,979,526

Property, plant and equipment

307,434

304,845

Total noncurrent assets

28,656,737

27,139,995

 

 

 

Total assets

31,120,003

30,355,440

 

 

 

LIABILITIES AND EQUITY

06/30/2015

12/31/2014

Current liabilities

 

 

Trade payables and contractors

254,389

323,513

Current portion of long-term loans and financing

859,871

1,207,126

Accrued payroll and related charges

353,717

387,971

Taxes and contributions

70,590

74,138

Interest on shareholders' equity payable

126,887

214,523

Provisions

597,144

625,092

Services payable

302,680

318,973

Public-Private Partnership – PPP

38,977

38,047

Program Contract Commitments

201,762

189,551

Other liabilities

86,073

101,642

Total current liabilities

2,892,090

3,480,576

 

 

 

Noncurrent liabilities

 

 

Loans and financing

10,231,564

9,578,641

Deferred Cofins and Pasep

131,135

129,351

Provisions

378,834

595,255

Pension obligations

2,810,893

2,729,598

Public-Private Partnership – PPP

504,378

330,236

Program Contract Commitments

41,790

18,208

Other liabilities

191,425

189,172

Total noncurrent liabilities

14,290,019

13,570,461

 

Total liabilities

17,182,109

17,051,037

 

 

 

Equity

 

 

Capital stock

10,000,000

10,000,000

Earnings reserves

3,672,149

3,694,151

Other comprehensive income

(389,748)

(389,748)

Accrued earnings

655,493

-

Total equity

13,937,894

13,304,403

 

 

 

Total equity and liabilities

31,120,003

30,355,440

 

Page 10 of 11


 
 

Cash Flow

 

Brazilian Corporate Law

 

R$ '000

 

 

Jan-Jun/2015

Jan-Jun/2014

Cash flow from operating activities

 

 

 

Profit before income tax and social contribution

790,096

1,162,789

Adjustment for:

 

 

 

Depreciation and amortization

537,395

482,852

 

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

3,491

1,801

 

Allowance for doubtful accounts

47,520

76,328

 

Provision and inflation adjustment

(171,045)

95,467

 

GESP Agreement

(696,283)

-

 

Interest calculated on loans and financing payable

232,201

216,351

 

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

773,054

(139,278)

 

Interest and inflation adjustment losses

12,123

10,850

 

Interest and inflation adjustment gains

(28,367)

(5,626)

 

Financial charges from customers

(111,328)

(99,846)

 

Margin on intangible assets arising from concession

(31,627)

(25,287)

 

Provision for Consent Decree (TAC)

(43,148)

23,986

 

Equity result

(999)

319

 

Provision from São Paulo agreement

(3,808)

(18,051)

 

Provision for defined contribution plan

4,605

3,515

 

Pension obligations

164,130

144,647

 

Other adjustments

(2,298)

60,967

   

1,475,712

1,991,784

Changes in assets

 

 

 

Trade accounts receivable

(18,269)

262,977

 

Accounts receivable from related parties

13,019

30,566

 

Inventories

11,045

(256)

 

Recoverable taxes

36,437

-

 

Escrow deposits

14,978

10,345

 

Other accounts receivable

(12,408)

(39,123)

Changes in liabilities

 

 

 

Trade payables and contractors

(15,114)

(18,357)

 

Services received

(12,485)

28,966

 

Accrued payroll and related charges

8,894

7,843

 

Taxes and contributions payable

11,317

(87,530)

 

Deferred Cofins/Pasep

1,784

1,563

 

Provisions

(73,324)

(123,598)

 

Pension obligations

(82,835)

(78,824)

 

Other liabilities

(16,827)

(13,121)

     

 

Cash generated from operations

1,341,924

1,973,235

     

 

 

Interest paid

(389,020)

(307,106)

 

Income tax and contribution paid

(17,743)

(388,216)

   

 

 

Net cash generated from operating activities

935,161

1,277,913

   

 

 

Cash flows from investing activities

 

 

 

Acquisition of intangibles

(1,196,001)

(1,130,122)

 

Restricted cash

(421)

(10,130)

 

Investment increase

243

(17)

 

Purchases of tangible assets

(14,784)

(52,135)

 

Dividends received

1,526

-

Net cash used in investing activities

(1,209,437)

(1,192,404)

   

 

 

Cash flow from financing activities

 

 

 

Loans and financing

 

 

 

Proceeds from loans

388,012

795,911

 

Repayments of loans

(876,443)

(326,390)

 

Payment of interest on shareholders'equity

(106,985)

(467,439)

 

Public-Private Partnership – PPP

(11,333)

(9,921)

 

Program Contract Commitments

(38,935)

(35,960)

Net cash generated by financing activities

(645,684)

(43,799)

   

Cash reduce and cash equivalents

(919,960)

41,710

       

Represented by:

   

Cash and cash equivalents at beginning of the period

1,722,991

1,782,001

Cash and cash equivalents at end of the period

803,031

1,823,711

Cash reduce and cash equivalents

(919,960)

41,710

 

Page 11 of 11

 

 

SIGNATURE  
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, in the city São Paulo, Brazil.
Date: August 13, 2015
 
Companhia de Saneamento Básico do Estado de São Paulo - SABESP
By: /s/  Rui de Britto Álvares Affonso    
 
Name: Rui de Britto Álvares Affonso
Title: Chief Financial Officer and Investor Relations Officer
 

 

 
FORWARD-LOOKING STATEMENTS

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