On December 31, 2019, gross debt reached BRL 3,243.9 million, up BRL 228.9 million YoY, due mainly to new fundraising efforts (8th debentures issue and BNDES disbursements) for investment in growth projects (greenfield and reinforcements and improvements), partly offset by the period’s amortizations.

In accordance with CPC 06 (R2), according to which, starting January 2019, the Company must recognize future obligations on all leasing contracts with the exception of short-term and/or low-value agreements, BRL 49.9 million have been added to IFRS gross debt with respect to the Company’s leases. Therefore, IFRS gross debt was BRL 3,293.8 million. Regulatory accounting remains unchanged.

The increase in the Company’s cash and cash equivalents is justified, mainly, by the 1st debentures issue of IE Ivaí, in the amount of BRL 1.65 billion for the project’s CapEx. Excluding the availabilities of partially owned subsidiaries, the Company’s net debt was BRL 2,546.6 million in December of 2019 vs. BRL 2,548.2 million in December of 2018. The Net Debt/Adjusted EBITDA ratio, given this adjustment, was 1.0x in December 2019.

The company is compliant with the covenants and requirements for all of its issues. For the years 2019 and 2020, the most restrictive Net Debt/EBITDA index is 3.0x. Greater details on financial indicators are available in Attachment V to this document.

The average cost of consolidated debt was 7.5% p.a. on December 31, 2019 vs. 7.9% p.a. on December 31, 2018, because of the decrease in IPCA between periods. The IPCA is the company’s main debt index, as well as its main revenues index. The average maturity of the consolidated debt on December 31, 2019 was 4.0 years.

In 2020, the Company will repay BRL 1.1 billion of its gross debt, composed, mainly of debts under Law 4,131/62 and the 6th debenture issue.

Debt Amortization Schedule (BRL million)

Debt Breakdown


  
Issue Total offering Nominal Unit Value Series Issue Maturity Remuneration Documents
4th Issue R$ 148.3 million R$ 1 thousand Single Series 07/15/2016 07/15/2021 IPCA + 6.04%


5th Issue

 
R$ 300.0 million R$ 1 thousand Single Series 02/15/2014 02/15/2024 IPCA + 5,04% per year (Portuguese Only) (Portuguese Only) (Potuguese Only) (Portuguese Only) (Potuguese Only) (Potuguese Only) (Potuguese Only)
(Portuguese Only)
Report Rating (FITCH)
(Potuguese Only)
6th Issue R$ 350 million R$ 1,000 Single 12/13/2017 12/13/2020 105,65% of CDI per year
7th Issue R$ 621.0 million R$ 1,000 Single 02/05/2018 04/15/2025
IPCA + 4,70  per year
8th Issue R$ 409.0 million R$ 1,000 Single 12/20/2019 12/15/2029 IPCA + 3.50 per year
  Debenture
Issue Total offering Nominal Unit Value Series Issue Maturity Remuneration Documents
2nd Issue R$ 350 million R$ 10 thousand Single 03/18/2013 03/18/2025 IPCA + 5.5% per year
  Debenture
Issue Total offering Nominal Unit Value Series Issue Maturity Remuneration Documents
1st Issue R$ 1.6 billion 1.000 Single 12/15/2019 12/15/2043 (24 years) IIPCA + 4.9982% per year

Updated on March 25, 2020.