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  • 1. Earnings Release 2010 Obrascon Huarte Lain Brasil S.A. March 25 th, 2011 Page 1 / 23E- Earnings Release 2010 São Paulo, March 25, 2011
  • 2. Earnings Release 2010 March 25 th, 2011 Page 2 / 23596,5 MILLION TOLL-PAYING VEHICLE-EQUIVALENTS (+33.6%), NET REVENUE OF R$ 2,184.5 MILLION (+18,1%), ADJUSTED EBITDA OF R$ 942.1 MILLION (+39.2%) AND NET INCOME OF R$ 304.2 MILLION São Paulo, March 25, 2011 – Obrascon Huarte Lain Brasil S.A. – OHL Brasil (Novo Mercado da BM&FBOVESPA: OHLB3) announces its results for the year DISCLOUSE AGENDA 2010, ended December 31, 2010. Financial and operating information below, CONFERENCE CALL except when otherwise stated, is presented on a consolidated basis and in Reais, according to Corporate Legislation. Since 2010, the Company has been submitting its financial statements in IN PORTUGUESE Monday (March 28, 2011) compliance with accounting standards established by the International Accounting 09:00 (US Eastern Time) Standards Board - IASB (known as International Financial Reporting Standards - 10:00 (São Paulo) Tel.: +55 (11) 4688-6361 IFRS) and reflected by CVM Instruction 457, July 13 2007 and amendments Code: OHL thereto. Replay: From March 28 to April 3 Fone: +55 (11) 4688-6312 Code: 7082638 HIGHLIGHTS 2010 WEBCAST The audio for the video conference 1ST DEBENTURES ISSUANCE IN THE STATE CONCESSIONS will be available live on the internet In 2010, Grupo OHL Brasil decided to extend the profile of its consolidated debt through the link http://webcall.riweb.com.br/ohlbrasil and adapt it to the profile of long-term concession projects, as well as to migrate and will be available on the the debt with commercial banks to the market of fixed income institutional company‟s website after the event. investors. In April 2010 OHL Brasil concluded its first public issue of debentures for state concessions, issuing R$1.4 billion in two tranches of 5 and 7 years, at an average cost of CDI + 1.6%p.y. and IPCA + 8%p.y., respectively. Yet within this same goal, in November 2010, two of the four concessionaires (Autovias and Intervias) issued over $ 400 million in debentures with a maturity of five years and interest rate CDI + 1.7% p.y. INCORPORATION OF THE SPR BY VIANORTE On December 17, 2010 SPR - Sociedade para Participações em Rodovias S/A (“SPR”) was entirely acquired by Vianorte S.A., and OHL Brasil S.A. assumed direct control of Vianorte S.A. The incorporation integrated the project of structure reorganization of OHL Brasil Group, aiming at providing better economic efficiency and better synergy, reducing operational and financial costs and simplifying the corporate structure.BM&FBovespa: OHLB3Bloomberg: OHLB3 BZThomson Reuters: OHLB3.BR APPROVAL OF THE TERMS OF LONG-TERM FINANCING FOR REGIS BITTENCOURT CONCESSIONAIREUpdated:03/24/2011Closed Price: R$ 60,50 per share On October 14, 2010, BNDES approved a long-term financial collaboration withMarket Cap.: R$ 4,2 billion Régis Bittencourt concessionaire on the amount of R$ 1.1 billion for the implementation of investments to improve and recover the highway‟s infrastructure. This approval is part of the overall financial plan for federal concessionaires in which the BNDES has committed to finance up to 70% of major investments. The Company expects that in the first half of 2011 the long term contract for the other four federal concessions will be signed.Investor Relations www.ohlbrasil.com.br ri@ohlbrasil.com.brRua Joaquim Floriano, 913, 6º andar - José Carlos Ferreira de Oliveira Filho CEO and IRO josecarlo@ohlbrasil.com.brItaim Bibi – São Paulo – SP - Alessandro Scotoni Levy IR Manager and Planning alessandro@ohlbrasil.com.brCEP 04534-013Phone: (+55 11) 3074-2409
  • 3. Earnings Release 2010 March 25 th, 2011 Page 3 / 23 OBRASCON HUARTE LAIN BRASIL S.A. CONSOLIDATED INCOME STATEMENT (In thousands of Brazilian reais) 2009 Adjustment 2009 IFRS 2010 IFRS Var%GROSS SERVICE REVENUE 1,301,777 670,192 1,971,969 2,342,622 18.8% Toll plazas revenue 1,292,113 - 1,292,113 1,631,185 26.2% State 840,539 - 840,539 971,562 15.6% Autovias 211,077 - 211,077 243,855 15.5% Centrovias 202,333 - 202,333 238,606 17.9% Intervias 238,619 - 238,619 272,631 14.3% Vianorte 188,510 - 188,510 216,470 14.8% Federal 451,574 - 451,574 659,623 46.1% Planalto Sul 60,854 - 60,854 77,603 27.5% Fluminense 67,703 - 67,703 112,701 66.5% Fernão Dias 95,179 - 95,179 134,928 41.8% Régis Bittencourt 153,072 - 153,072 204,238 33.4% Litoral Sul 74,766 - 74,766 130,153 74.1% Accessory revenues 9,664 - 9,664 10,424 7.9% Others - 57,102 57,102 83,186 45.7% Construct revenue - 613,090 613,090 617,827 0.8%DEDUCTIONS FROM REVENUE (112,768) (9,110) (121,878) (158,093) 29.7%NET SERVICE REVENUE 1,189,009 661,082 1,850,091 2,184,529 18.1%COST AND SERVICE EXPENSES (512,039) (684,143) (1,196,182) (1,350,320) 12.9% Cost of services (excl. depreciation and amortization) (405,318) 17,513 (387,805) (460,112) 18.6% Cost of construction services - (613,090) (613,090) (617,827) 0.8% Administrative expenses (excl. depreciation and amortization) (94,726) (11,526) (106,252) (116,771) 9.9% Directors compensation (9,639) (1,282) (10,921) (12,526) 14.7% Tax expenses (5,775) (21) (5,796) (2,199) -62.1% Provision for highwayss maintenance - (75,737) (75,737) (146,085) 92.9% Other operating revenues, net 3,419 - 3,419 5,200 52.1%EBITDA 676,970 (23,061) 653,909 834,209 27.6%EBITDA margin 56.9% 35.3% 38.2%DEPRECIATIONS AND AMORTIZATIONS (256,613) 111,884 (144,729) (181,460) 25.4% Depreciation and amortization (248,480) 111,884 (136,596) (175,359) 28.4% Amortization of goodwill on investments (8,133) - (8,133) (6,101) -25.0%FINANCIAL RESULTS (155,585) (10,311) (165,896) (217,898) 31.3% Financial revenues 33,246 62 33,308 92,792 178.6% Financial expenses (188,831) (10,373) (199,204) (310,690) 56.0%INCOME BEFORE INCOME TAX AND SOCIAL CONTRIBUTION 264,772 78,512 343,284 434,851 26.7%INCOME TAX AND SOCIAL CONTRIBUTION (88,494) (27,438) (115,932) (130,602) 12.7% Current (97,430) (16,072) (113,502) (147,243) 29.7% Deferred 8,936 (11,366) (2,430) 16,641 -784.8%NET INCOME FOR THE PERIOD 176,278 51,074 227,352 304,249 33.8% Basic profit per share (in R$) 2.55887 3.30027 4.41652 33.8% Numb er of shares (units) 68,888,888 68,888,888 68,888,888
  • 4. Earnings Release 2010 March 25 th, 2011 Page 4 / 23ECONOMIC AND FINANCIAL PERFORMANCEGROSS SERVICE REVENUEIn fiscal year 2010, consolidated gross revenue reached R$ 2.3 billion, an increaseof 18.8% over the previous year. This total consists of toll plaza revenues,construct revenues and other revenues (accessories, maintenance and roadpaving), amounting respectively to R$ 1.6 billion, R$ 617.8 million and R$ 93.6million. Revenue Breakdown 2010 2009 4% 3% 26% 31% 70% 66% Toll Plazas Construct Others Toll Plazas Construct OthersToll Plazas RevenueThe state concessionaires accounted for 59.6% of the total amount collected fromtolls, closing the year with R$ 971.6 million (+15.6%) while the federalconcessionaires, which were in the process of opening markets in 2009, advanced46.1%, and ended the year with R$ 659.6 million, growing its 34.9% share of totalrevenues from tolls for 2009 to 40.4% in 2010. Consolidated toll revenues rose26.2% in fiscal year 2010 against 2009 as a result of two main factors: (i) tolledtraffic growth (+33.6%) offset by a (ii) reduction of average toll tariff practiced (-5.5%).Tolled traffic: This year, tolled traffic totaled 596.5 million vehicle-equivalents,33.6% higher than in 2009. Var% Vehicle-Equivalents 2010 2009 2010/2009 Autovias 41,849,580 37,653,446 11.1% Centrovias 29,265,444 22,523,774 29.9% Intervias 56,858,906 51,628,066 10.1% Vianorte 31,466,466 28,545,634 10.2% Total - State Concessions 159,440,396 140,350,920 13.6% Planalto Sul 26,696,770 22,477,509 18.8% Fluminense 43,491,756 27,081,364 60.6% Fernão Dias 121,656,967 86,526,227 40.6% Régis Bittencourt 136,158,667 102,048,021 33.4% Litoral Sul 109,039,366 67,969,091 60.4% Total - Federal Concessions 437,043,526 306,102,213 42.8% Total 596,483,922 446,453,133 33.6%
  • 5. Earnings Release 2010 March 25 th, 2011 Page 5 / 23The 33.6% growth in total traffic tolled was due to (i) strong economic growthconcurrent with the resumption of industrial production, contributing to the increaseof traffic on the highways managed by the Company, (ii) the beginning of tollcollection in federal concessionaires plazas in 2009 and (iii) the charging of tolls inboth directions in four toll plazas by Centrovias concessionaire.The strong economic growth in 2010, together with the resumption of industrialproduction, was also confirmed by the growth of tolled traffic at Autovias, Interviasand Vianorte concessionaires.The 42.8% growth in tolled traffic in federal concessionaires was due to theopening of 23 toll plazas in 2009 and 01 toll plaza in 2010. (ii) In September 2010,the last toll plaza from Autopista Fernão Dias concessionaire located in themunicipality of Mairiporã came into operation.The following charts illustrate the seasonality of the traffic on federal and stateconcessionaires in 2010. Federal Concessions - Seasonality 2010 1,20 ABCR BRA 1,15 OHL Federais ABCR SP 1,10 Média Trim. OHL Federais 1,05 1,00 0,95 0,90 0,85 jan feb mar apr may jun jul aug sep oct nov dec State Concessions - Seasonality 2010 1,20 ABCR BRA 1,15 OHL Estaduais ABCR SP 1,10 Média Trim. OHL Estaduais 1,05 1,00 0,95 0,90 0,85 jan feb mar apr may jun jul aug sep oct nov decIn the second half of 2010, four toll plazas managed by Centrovias concessionairestarted charging tolls in both directions and had their toll tariffs reduced by half. Asa result tolled traffic grew 29.9% and the average fare dropped 9.2% in the sameyear.Tolled traffic (measured in vehicle-equivalents) in 2010 was broken down as 61.9%for trucks and heavy vehicles and 38.1% light vehicles for state concessionaires,and 74.6% heavy vehicles and 25.4% light vehicles in federal concessionaires.
  • 6. Earnings Release 2010 March 25 th, 2011 Page 6 / 23Average toll tariff: Next, see the table with the consolidated comparative averagetoll tariff evolution for each concessionaire: Average Toll Tariff Var% 2010 2009 (in R$/Vehicle-Equivalents) 2010/2009 Autovias 5.83 5.61 3.9% Centrovias 8.15 8.98 -9.2% Intervias 4.79 4.62 3.7% Vianorte 6.88 6.60 4.2% State Concessions 6.09 5.99 1.7% Planalto Sul 2.91 2.71 7.4% Fluminense 2.59 2.50 3.7% Fernão Dias 1.11 1.10 0.8% Régis Bittencourt 1.50 1.50 0.0% Litoral Sul 1.19 1.10 8.5% Federal Concessions 1.51 1.48 2.3% Total 2.73 2.89 -5.5%In accordance with the concession agreements, toll tariffs are adjusted once a yearin compliance with criteria set in the contracts and the accumulated variation ofIGP-M index for state concessionaires and IPCA for federal concessionaires.The increase of average toll tariffs of the Autovias, Intervias and Vianorteconcessionaires is explained by the contractual adjustment based on the IGP-M. AtCentrovias, despite the contract adjustment, average toll tariff dropped 9.2% due tothe fact that toll collection switched to bidirectional (both side directions) in fourplazas, and toll tariff were reduced by 50%.On July 1st 2010, state concessionaires had adjustment toll tariff by 4.18%, and onJuly 1st 2009 the adjustment was 3.64% according to the IGP-M variationaccumulated between June of the year prior to the adjustment and May of the yearwhen the adjustment was made.Federal concessionaires, on the other hand, adjust their basic toll tariffs once ayear according to the cumulative variation of the IPCA, rounding the first decimalplace. Adjustments provided for concessionaires Fluminense and Litoral Sul alwaysoccur in February, whereas Fernão Dias, Regis Bittencourt and Planalto Sul havetheir adjustments implemented in December.In December 2009, the tariff adjustment adopted by the Planalto Sulconcessionaire increased the toll tariff to R$ 2.90, taking into consideration (i) thecriterion for rounding the first decimal place, and (ii) IPCA variation betweenDecember 2008 and November 2009 (+4.22%). In February 2010, the toll tariffcharged by concessionaires Fluminense and Litoral Sul also were increased, set atR$ 2.60 and R$1.20 respectively. The toll tariff charged by concessionaires FernãoDias and Regis Bittencourt for the same comparable periods were not changeddue to the criterion of rounding place by the contracts.In 2010, the average toll tariff dropped by 5.5% due to the fact that federalconcessionaires, which operate at lower tariffs, increased their share of total tollrevenue breakdown.
  • 7. Earnings Release 2010 March 25 th, 2011 Page 7 / 23Electronic Collection: The revenue from the electronic payment systems (AVISystem) at state concessionaires‟ toll plazas accounted for 56.4% of total revenuein 2010 against 52.9% recorded last year. In the federal concessionaires theaverage percentage of revenue from electronic billing was 35.7% versus 28.8% in2009. Below we present a chart with quarterly figures for revenue by electroniccollection, starting in the first quarter of 2009: AVI State Concessions 1Q09 2Q09 3Q09 4Q09 2009 1Q10 2Q10 3Q10 4Q10 2010 57.3% 56.7% 56.4% 56.0% 53.7% 53.8% 53.9% 53.0% 52.9% 50.7% AVI Federal Concessions 1Q09 2Q09 3Q09 4Q09 2009 1Q10 2Q10 3Q10 4Q10 2010 36.9% 38.1% 35.4% 35.7% 30.2% 31.6% 29.6% 28.8% 27.5% 25.0%Construct RevenueThe new accounting standards (ICPC-01 / IFRIC 12), which came into effect on01/01/2010, have changed the way we record revenues from concession contractsand now they also include revenues of works from investments in intangible assets.This new form to enter revenues changed the Profit and Loss statement andimpacted the margins EBITDA, EBIT and Net Income, but had no impact on theCompany‟s Net Income volume, since the counterpart of this revenue, the cost ofwork, in equal value (no margin of work) is rubric as “Cost of ConstructionServices”.In 2010, revenue from work grew 0.8% compared to the previous year, and 89.8%of these works were performed in federal concessionaires due to largerinvestments tied to concession contracts.Other RevenuesThe revenues from the exploration of the domain of the highway side areas byconcessionaires, as well as revenue from maintenance and paving of highways byconstruction companies in the group OHL grew 40.2% in 2010.
  • 8. Earnings Release 2010 March 25 th, 2011 Page 8 / 23The concessionaires had R$ 10.4 million of revenue with exploration of the domainof the highway side areas, with a growth of 7.9% compared to 2009. Revenuesfrom maintenance and paving were R$ 83.2 million, being 45.7% higher than 2009.NET SERVICE REVENUE AND DEDUCTIONS FROM REVENUEIn the year ended December 31, 2010, the Company recorded net revenue ofservices worth amounting to R$ 2.2 billion, an increase of 18.1% against 2009.Deductions from revenue consists principally of taxes such as ISS, PIS andCOFINS have kept pace with increases in revenue from tolls and ended the yearwith R$ 158.1 million, growing 29.7% vis-à-vis 2009. The taxes are calculated onthe revenues from tolls at the following rates: PIS (0.65%), COFINS (3.0%) andISS (5.0%).COST AND SERVICE EXPENSESCosts and operating expenses (excluding depreciation and amortization) grew12.9% or R$ 154.1 million mainly as a result of the start-up and opening of tollplazas in the federal concessionaires. It must be remembered that during 2009 23toll plazas came into operation on the federal concessionaires and hence thestructure of costs and expenses related to staff and operations for these tollincreased.With the adoption of new accounting standards (ICPC-01 / IFRIC 12), which cameinto effect on 01/01/2010, two new costs started being recorded in the Company‟sResults: (i) "Cost of Construction Services" as a counterpart to the "ConstructRevenue", already mentioned in the section contemplating gross revenues, and (ii)"Provision for Highways‟ maintenance”, which regarding the provision forinvestments on highway maintenance for future years.Next we present a table with the composition of costs and expenses (excludingdepreciation and amortization): Cost and Services Expenses ¹ Var% 2010 2009 (R$ Thousand) 2010/2009 Cost of construction services (617,827) (613,090) 0.8% Outside services (173,541) (155,050) 11.9% Personnel expenses (157,829) (114,026) 38.4% Provision for highwayss maintenance (146,085) (75,737) 92.9% Routine maintenance (79,153) (78,606) 0.7% Supervision and tecn. development fee (30,798) (28,379) 8.5% Variable charge (state concessions) (30,355) (26,292) 15.5% Insurance and guarantees (12,703) (13,007) -2.3% Directors compensation (12,526) (10,921) 14.7% Consumption (6,176) (4,897) 26.1% Tax expenses (2,199) (5,796) -62.1% Transportation (1,448) (1,311) 10.5% Other operating expenses, net (79,680) (69,070) 15.4% Total (1,350,320) (1,196,182) 12.9% ¹ Excl. depreciation and amortization.
  • 9. Earnings Release 2010 March 25 th, 2011 Page 9 / 23Regarding the increase of R$ 154.1 million in costs and operating expenses thefollowing aspects stand out:  Constitution of the rubric "Cost of construction services" which includes works undertaken by the concessionaires during the year, in that the largest amount concerns the federal concessionaires;  Increase of R$ 70.3 million in "Provision for highways‟ maintenance” because of the expectation of maintenance, according to the concession contracts. It must be highlighted that the cash disbursements of such costs will occur in subsequent years;  Increases in costs with "Personnel" and "Outsourced Services", in the respective amounts of R$ 43.8 million and R$ 18.5 million, mainly due to the growth in headcount and the expansion of federal concessionaires‟ operating structure with the opening of new toll plazas;  Growth of the cost relative to the "variable charge" in 2010, in line with the increase in toll revenues (+15.6%) of the state concessionaires;  Reduction of R$ 3.6 million in "Tax expenses” due mainly to additional installment plan devised for Vianorte concessionaire‟s debits with PIS / COFINS taxes in 2009.EBITDA AND ADJUSTED EBITDAThe operating income as measured by EBITDA amounted to R$ 834.2 million in2010, showing an increase of 27.6% over the previous year. As a consequence,the EBITDA margin increased 2.9 percentage points, going from 35.3% last year to38.2% in 2010. The calculation considered the new accounting methodology(ICPC-01 / IFRIC 12), which is reflected mainly in the acknowledgement of costsconcerning "Provision for maintenance of highways."For the sake of comparison with data reported by the Company prior to theadoption of those accounting practices, adjustments were made in the calculationbasis for reversal of the amount in "Provision for maintenance of highways” and forthe reversal of unrealized profits of the following companies: Latina Manutenção,Latina Sinalização, and Paulista. Therefore, the Adjusted EBITDA for the year2010 totaled R$ 942.1 million, which corresponds to a margin of 43.1% andrepresents a strong growth over the margin of 36.6% recorded in 2009. EBITDA Var% 2010 2009 2010/2009 Net Revenue 2,184,529 1,850,091 18.1% Cost and Service Expenses (1,350,320) (1,196,182) 12.9% EBITDA 834,209 653,909 27.6% EBITDA Margin 38.2% 35.3% (+) Provision for highwayss maintenance 146,085 75,737 92.9% (-) Consolidation Adjustments ¹ (38,214) (52,676) Adjusted EBITDA (before IFRS) 942,080 676,970 39.2% EBITDA Margin 43.1% 36.6% 1) Consolidation adjustments and reversal of unrealized profit retention (EBITDA Constructors). 2) EBITDA (Earnings before Interest, Taxes, Depreciation and Amortization). 3) Refers to the provision set for the maintenance of highways, in accordance with accounting pronouncement ICPC 01. EBITDA is not used in the accounting practices nor does it represent the cash flow for the periods presented. Therefore, it should not be considered as an alternative for cash flow as an indicator of liquidity. EBITDA does not have a standardized meaning and thus cannot be compared to the EBITDA of other companies.
  • 10. Earnings Release 2010 March 25 th, 2011 Page 10 / 23 Below, a table with the calculation of EBITDA and Adjusted EBITDA for companies in the Group. Net Revenue Costs and Services ¹ Provision for AjustedGroup Com panies Services Construct Total Cost of Cost of Total EBITDA highw ayss Ajusted EBITDA EBITDA(R$ Thousand) Revenue (A) Revenue (B) (A + B) Services (A) Construction (A + B) m aintenance M argin Service (B) Autovias 224.711 4.327 229.038 (82.172) (4.327) (86.499) 142.539 28.570 171.109 74,7% Centrovias 219.869 30.354 250.223 (70.056) (30.354) (100.410) 149.813 23.293 173.106 69,2% Intervias 252.298 16.703 269.001 (91.854) (16.703) (108.557) 160.444 31.143 191.587 71,2% Vianorte 199.120 11.333 210.453 (86.454) (11.333) (97.787) 112.666 41.141 153.807 73,1%State Concessions 895.998 62.717 958.715 (330.536) (62.717) (393.253) 565.462 124.148 689.610 71,9% Planalto Sul 69.990 66.380 136.370 (44.786) (66.380) (111.166) 25.204 3.204 28.408 20,8% Fluminense 101.773 54.839 156.612 (54.437) (54.839) (109.276) 47.336 3.413 50.749 32,4% Fernão Dias 123.486 180.198 303.684 (96.723) (180.198) (276.921) 26.763 5.388 32.151 10,6% Régis Bittencourt 186.302 154.613 340.915 (86.876) (154.613) (241.489) 99.426 5.206 104.632 30,7% Litoral Sul 118.933 99.080 218.013 (72.577) (99.080) (171.657) 46.356 4.726 51.082 23,4%Federal Concessions 600.484 555.110 1.155.594 (355.399) (555.110) (910.509) 245.085 21.937 267.022 23,1%Total Concessionaires 1.496.482 617.827 2.114.309 (685.935) (617.827) (1.303.762) 810.547 146.085 956.632 45,2%OHL Holding - - - (14.270) - (14.270) (14.270) - (14.270)Constructors - 267.818 267.818 - (229.604) (229.604) 38.214 - 38.214Other companies and eliminations for consolidation - (197.598) (197.598) (282) 197.598 197.316 (282) - (282)Total 1.496.482 688.047 2.184.529 (700.487) (649.833) (1.350.320) 834.209 146.085 980.294 44,9%Consolidation adjusts ² - - - - - - - - (38.214)Total Consolidated 1.496.482 688.047 2.184.529 (700.487) (649.833) (1.350.320) 834.209 146.085 942.080 43,1% ¹ Excl. depreciation and amortization. ² Adjustments for the elimination of unrealized profits by construction companies. FINANCIAL RESULTS Var% Financial Result (R$ thousand) 2010 2009 2010/2009 Financial Revenues 92,647 33,058 180.3% Financial Expenses (310,577) (198,736) 56.3% Financial charges (236,154) (160,131) 47.5% Monetary correction of fixed c. charge (55,149) (12,764) 332.1% Other financial expenses (19,274) (25,841) -25.4% Net Exchange Variation 32 (218) -114.7% Net Financial Result (217,898) (165,896) 31.3% In 2010, the net financial result was negative at R$ 217.9 million, compared to a negative result of R$ 165.9 million recorded in 2009. The main factors contributing to such variation include:  Increase of R$ 76 million in financial charges generated by (i) the issue of debentures, which were realized by state concessionaires, and (ii) the release of credit lines from BNDES for investments included in the federal concession contracts and (iii) the passage of time effect (adjustment of present value);  Increase of R$ 42.4 million in "Monetary Correction of Fixed Concession Charge" caused by (i) the increase in the IGP-M inflation index in 2010, which showed a growth of 11.3% over a negative variation of 1.7% in 2009;  Increase of R$ 59.6 million in revenues from financial investments due to the increase of CDI plus the addition of the balance of financial investments.
  • 11. Earnings Release 2010 March 25 th, 2011 Page 11 / 23NET INCOMEIn 2010, the consolidated net income grew 33.8% over the previous year. Asalready mentioned, the main factors leading to the increase were: (i) star-up of100% of the toll plazas operation in federal concessions; (ii) contractual tariffadjustments, and (iii) two-way charging at the Centrovias toll plazas. Moreover, thebest performance of the economy impacted positively vehicle traffic tolled. Net Income (R$ million) 304.2 227.4 2009 2010INDEBTEDNESSOn December 31, 2010, the consolidated net debt (loans and financing plusdebentures minus cash and cash equivalents) of the company amounted to R$ 1.5billion, an increase of $ 176.6 million or 13.1% over the same period last year. Debt 31-dez-10 31-dez-09 Var% (In thousands of Brazilian reais) Gross Debt 2,788,542 1,793,933 55.4% Short Term 1,234,363 946,883 30.4% Long Term 1,554,179 847,050 83.5% Cash and equivalents 1,168,288 442,192 Restricted cash investments ¹ 97,176 5,298 Net Debt 1,523,078 1,346,443 13.1% ¹ Short and long term.This R$ 176.6 million increase was due mainly to the following:  Increase of R$ 1.8 billion due to the first issuance of debentures (totaling R$ 1.4 billion) from the four state concession companies, conducted in April, and the second issuance of debentures (totaling R$ 400 million), conducted in November, from state concession companies Autovias and Intervias;  Increase of R$ 124.1 million due to disbursements for the BNDES bridge loan for federal concessions;  Reduction of R$ 198 million related to the repaying of principal and interest on bank credit agreements signed by Autovias and Intervias;  Reduction of R$ 753.3 million due to the repaying of promissory notes and loans with BNDES on the part of the state concession companies;
  • 12. Earnings Release 2010 March 25 th, 2011 Page 12 / 23  Reduction of R$ 818.0 million related to the increase in cash and investments in the period;  Increase of R$ 48.8 million due to interest accrued and other transactions involving interest and principal.Debentures: In April 2010, the subsidiaries Autovias, Centrovias, Intervias andVianorte issued debentures, not convertible into shares, with real guarantees, inthe amount of R$ 1.4 billion. The funds raised were used for the early redemptionof debt (promissory notes), investments included in the concession agreement,strengthening of working capital, and distribution of proceeds. The operations werecharacterized by:  Autovias: issue of 405,000 debentures in two series: the first with a volume of R$ 285 million, to pay CDI + 1.6% per year and with a maturity period of five years; and the second with a volume of R$120 million, to pay IPCA + 8% per year and with a maturity period of seven years.  Centrovias: issue of 406,000 debentures in two series: the first with a volume of R$ 286 million, to pay CDI + 1.7% per year and with a maturity period of five years; and the second with a volume of R$ 120 million, to pay IPCA + 8% per year and with a maturity period of seven years.  Intervias: issue of 308,000 debentures in a single series, with a volume of R$ 308 million, to pay CDI + 1.5% per year and with a maturity period of five years.  Vianorte: issue of 257,000 debentures in two series: the first with a volume of R$ 157 million, to pay CDI + 1.7% per year and with a maturity period of five years; and the second with a volume of R$100 million, to pay IPCA + 8% per year and with a maturity period of seven years.Also in 2010, in the month of November, new issues from Autovias and Interviaswere approved under CVM Instruction 476, with restricted distribution efforts. At thetime, 4,000 non-convertible debentures were issued (3,000 by Intervias and 1,000by Autovias), with real guarantees and a face value of R$ 100,000, to pay CDI +1.7% per year and with a maturity period of five years. Together the operationsamounted to $ 400 million.BNDES Loans: Since winning the auction for federal highways in 2007, theCompany has funds in the form of bridge loans and long term loans granted byBanco Nacional de Desenvolvimento Econômico e Social - BNDES, to financeinvestment programs of the five federal concession companies.In mid 2009 the Company signed five contracts for bridge loans in the total amountof R$ 1 billion to allow for continued investments until the signing of long-termcontracts. By December 31, 2010, R$ 907.5 million of this total had beendisbursed.
  • 13. Earnings Release 2010 March 25 th, 2011 Page 13 / 23Additionally, in October 2010, BNDES approved the granting of long-term financialcooperation to Autopista Régis Bittencourt in the amount of R$ 1.1 billion. Thatfunding was divided into two credit categories: Credit A, amounting to R$ 446.4million, with an amortization period of 144 months and a 12-month grace period,and costing TJLP (long term interest rate) + 2.21% per year; and Credit B,amounting to R$ 623.1 million, with an amortization period of 126 months and agrace period extending up to June 15, 2014, and costing TJLP (long term interestrate) + 2.21% per year.The long-term financing from BNDES to concession companies Autopista PlanaltoSul SA, Autopista Fernão Dias SA, Autopista Litoral Sul SA, and AutopistaFluminense SA are being examined by BNDES. Indebtness (R$ million) 2,789 1,794 1,554 847 1,234 947 2009 2010 Short Term Long TermOn December 31, 2010, the consolidated gross debt (loans and financing plusdebentures) of the company amounted to R$ 2.8 billion, with 34.3% of this amountcorresponding to TJLP (long term interest rate) indexed contracts, 52.3% to CDI-linked contracts, and 13.4% to contracts linked to IPCA (inflation). Gross Debt 31-dez-10 31-dez-09 Var% (In thousands of Brazilian reais) Indexes TJLP 961,874 890,361 8.0% CDI 1,463,260 903,572 61.9% IPCA 376,023 - - Prepaid charges (12,615) - - Total 2,788,542 1,793,933 55.4%The net debt at the end of 2010 was R$ 1.5 billion, which represented 1.7 times theAdjusted EBITDA minus the fixed concession charge paid in the last 12 months. 2.500 3,0 2.2 2.000 1.7 2,0 1.500 1,0 1.000 - 1,346.4 1,523.1 500 (1,0) - (2,0) 2009 2010 Net Debt Net Debt / Ajusted EBITDA - Fixed Concession Charge (last 12 months)
  • 14. Earnings Release 2010 March 25 th, 2011 Page 14 / 23On December 31, 2010, 97.3% of long-term debt consisted of debentures. Theamortization schedule of the Companys debt was: Year R$ Thousand 2011 296,085 2012 334,375 2013 335,085 2014 335,794 2015 273,968 2016 116,031 2017 116,168 Total 1,807,506FIXED CONCESSION CHARGE PAIDIn accordance with conditions set out in the concession contracts, the stateconcessions must pay a fixed charge to the concession authority for the granting ofthe concession. In 2010, the state concessions paid the Granting Authority R$ 55.5million in fixed charges. Fixed Concession Charge Paid Var% 2010 2009 (R$ Thousand) 2010/2009 Total (55,517) (53,427) 3.9% Autovias (5,846) (5,625) 3.9% Centrovias (8,746) (8,417) 3.9% Intervias (5,443) (5,238) 3.9% Vianorte (35,482) (34,147) 3.9%On December 31, 2010, the nominal value and the number of monthly installmentsto be paid related to the fixed concession charge were represented as follows: 12/31/2010 Nominal Value (R$ thousand) # of Monthly Concessionaires Short Term Long Term Total Payments Autovias 6,151 42,246 48,397 92 Centrovias 9,203 60,835 70,038 89 Intervias 5,727 47,696 53,423 109 Vianorte 37,336 237,191 274,527 86 Total 58,417 387,968 446,385INVESTMENTSOHL Brazil companies invested about R$ 598.3 million in fixed and intangibleassets in 2010. A significant portion of that amount (88.8%) was allocated toprojects conducted by federal concessions. Still in the early stages of theconcession contract, the main investments in federal concessions include:
  • 15. Earnings Release 2010 March 25 th, 2011 Page 15 / 23  Road enlargement at Serra do Cafezal (Rod. Régis Bittencourt)  Implementation of new toll plazas (Rod. Fernão Dias)  Paving and recovery of containing structures  Reinforcement and widening of bridges  Improved draining and lighting systems  Implementation of walkways Investments in state concessions (R$ 57.1 million) were directed, mainly to projects to split toll plazas (to have toll collection in both directions) in the municipality of Brotas, Dois Córregos, Rio Claro, and Itirapina (Centrovias Concessionaire). Additionally, we spent R$ 127.2 million in maintenance work for state highways which, in turn, have already reached an advanced stage of maturity, investment- wise. The funds were intended to preserve the roads, with the installation of concrete barriers and the repair of guard rails. With the adoption of new accounting standards (ICPC-01 / IFRIC 12), which came into effect as of 01/01/2010, future investments in maintenance of roads are now entered in the Companys results as "Provision for maintenance of Highways” under "Cost of Services". Similarly, payments (cash flow) related to the maintenance of highways are now entered in the "Cash Flow from Operating Activities" and no longer under "Cash Flow from Investing Activities". The following table shows the payment of fixed investments, intangibles and highway maintenance. 2010 2009 IFRS IFRSCapex Before BeforeCash Flow (R$ Thousand) IFRS (A + B) Intangible and Maintenance IFRS (A + B) Intangible and Maintenance Property (A) Realized (B) Property (A) Realized (B) Autovias 28,552 3,565 24,987 37,558 14,707 22,851 Centrovias 51,037 30,518 20,519 30,050 10,120 19,930 Intervias 60,408 10,818 49,590 40,960 19,000 21,960 Vianorte 44,270 12,174 32,096 28,976 15,720 13,256State Concessions 184,267 57,075 127,192 137,544 59,547 77,997 Planalto Sul 60,746 60,746 - 65,412 65,412 - Fluminense 51,735 51,735 - 98,521 98,521 - Fernão Dias 176,811 176,811 - 182,415 182,415 - Régis Bittencourt 147,633 147,633 - 199,619 199,619 - Litoral Sul 94,250 94,250 - 139,440 139,440 -Federal Concessions 531,175 531,175 - 685,407 685,407 -Total 715,442 588,250 127,192 822,951 744,954 77,997Others invest. and consolidation adjustments 10,031 10,031 - 5,833 5,833 -Total 725,473 598,281 127,192 828,784 750,787 77,997 In accordance with the obligations of road maintenance and new investments in intangible assets set out in the concession agreements, the Company expects to invest in 2011 about R$ 930 million in federal concessions and R$ 135 million in state concessions. Between 2012 and 2015, the Company intends to invest R$ 2.7 billion in federal concessions and R$ 570 million in state concessions.
  • 16. Earnings Release 2010 March 25 th, 2011 Page 16 / 23PERSONNELAs a result of increased operations and improved quality of services provided in2010, the workforce grew 21.8% over the previous year. The main indicators of thisincrease include (i) the incorporation of the toll collection activity at the Fernão Diashighway, which since the beginning of operations had been carried out by a third-party company, and (ii) the split of charges (into both sides/ways of the highway) infour toll plazas of the Centrovias operation. Personnel 2010 2009 Var. % OHL (Holding) 103 83 24.1% State Concessions 1,302 1,228 6.0% Autovias 193 194 -0.5% Centrovias 328 252 30.2% Intervias 542 543 -0.2% Vianorte 239 239 0.0% Federal Concessions 2,031 1,575 29.0% Litoral Sul 302 258 17.1% Planalto Sul 152 152 0.0% Fluminense 234 219 6.8% Fernão Dias 809 439 84.3% Régis Bittencourt 534 507 5.3% Paulista 203 203 0.0% Latina Manutenção 1,491 1,095 36.2% Latina Sinalização 176 171 2.9% Total 5,306 4,355 21.8%STOCK MARKETSOHL Brazil”s market value at the end of the year amounted to R$ 4.1 billion, basedon the closing price of R$ 59.99 per share on 30/12/2010. That price represents again of 76.44% over the closing price in the previous year. In the same period, theBovespa Index dropped 1.06%. Traded under the code OHLB3, the Companysshares were present in 100% of the trading sessions of the BM&FBOVESPA;transactions reached a total of about R$ 1.1 billion in the year. 195 Base 100 (12/30/2009) 170 145 120 95 70 12/30/09 01/30/10 02/28/10 03/31/10 04/30/10 05/31/10 06/30/10 07/31/10 08/31/10 09/30/10 10/31/10 11/30/10 12/31/10 OHLB3 IBOV Daily Average ¹ 2010 2009 Var. % Nº of Trades 183 145 26,2% Volume (R$ Milion) 4,58 2,43 88,5% ¹ Lote Padrão
  • 17. Earnings Release 2010 March 25 th, 2011 Page 17 / 23Shares are part of the theoretical portfolio of indexes: IGC – Stock Index withDistinguished Corporate Governance, ITAG - Stock Index with Distinguished TagAlong, and SMLL - Small Cap Index.SHAREHOLDING STRUCTUREThe Company‟s subscribed and paid-in capital was R$ 549.1 million on December31, 2010, representing a single class of 68,888,888 common shares. Partícipes em Brasil S.L. 14,7% 5,0% Credit Suisse Hedging Griffo 8,4% Skopos Adm. de Recursos 60,0% 11,9% Kendall Develops S.L. OthersORGANIZATIONAL STRUCTURE 100% 100% Participes en Brasil SL 60% STATE TOLL ROADS FEDERAL TOLL ROADS 100% 100% OTHER BUSINESS 100% 100% 100% 4.68%
  • 18. Earnings Release 2010 March 25 th, 2011 Page 18 / 23 PORTFOLIO OF CONCESSION ASSETS Below, we present the main information concerning our portfolio of concessions: Fixed ConcessionConcessionaires Km Toll Plazas Concession Contract Index Maturity ChargeState Concessions Autovias 316.6 5 ago-18 ago-18 IGP-M Centrovias 218.2 5 jun-18 jun-19 IGP-M Intervias 375.7 9 fev-20 jan-28 IGP-M Vianorte 236.6 4 mar-18 mar-18 IGP-MFederal Concessions Planalto Sul 382.3 5 n.a. fev-33 IPCA Fluminense 412.7 5 n.a. fev-33 IPCA Fernão Dias 320.1 8 n.a. fev-33 IPCA Régis Bittencourt 562.1 6 n.a. fev-33 IPCA Litoral Sul 401.6 5 n.a. fev-33 IPCA n.a. – not applicable CORPORATE PROFILE OHL Brasil is one of the largest companies in the highway concession sector by kilometers administrated in Brazil, with 3,226 km in operation. Through its new concessions, OHL Brasil administrates highways located in the states of São Paulo, Minas Gerais, Rio de Janeiro, Santa Catarina and Paraná. Currently, it holds 100% of capital in the following state concessions: Autovias, Centrovias, Intervias and Vianorte; and in the following federal concessions: Autopista Fernão Dias, Autopista Regis Bittencourt, Autopista Litoral Sul, Autopista Planalto Sul and Autopista Fluminense. OHL Brasil is a Brazilian company, 60.0% of the companys control being held by OHL Concesiones, a Spanish corporation that, since November 2000, has developed activities in the area of infrastructure promotion (ports, airports, highways and railways), including project selection, participation in bidding, financing, construction and operation of its projects. Currently, OHL Concesiones, in addition to being the majority shareholder in OHL Brasil, administrates different highway concession corporations in Spain, Chile, Peru, Mexico and Argentina. OHL Concesiones is a wholly-owned subsidiary of OHL S.A., a Spanish company and leader in the construction and concession sectors. Founded 98 years ago and currently present in 21 countries, OHL S.A. has been listed on the Madrid Stock Market since 1991. For more information, access: www.ohlbrasil.com.br This release contains forward-looking statements relating to the prospects of the business, estimates for operating and financial results, and those related to growth prospects of OHL Brasil. These are merely projections and, as such, are based exclusively on the expectations of OHL Brasil’s management concerning the future of the business and its continued Access to capital to fund the Company’s business plan. Such forward-looking statements depend substantially on changes in market conditions, government regulations, competitive pressures, and the performance of the Brazilian economy and the industry, and are, therefore, subject to change without prior notice.
  • 19. Earnings Release 2010 March 25 th, 2011 Page 19 / 23ANNEX 1 BALANCE SHEET OBRASCON HUARTE LAIN BRASIL S.A. BALANCE SHEET AS OF DECEMBER 31.2010 AND DECEMBER 31.2009 (In thousands of Brazilian reais) 2009 2009 IFRS Adjustment 2010 IFRS ASSETS CURRENT Cash and equivalents 442,192 442,192 - 1,168,288 Trade accounts receivable 64,141 64,141 - 84,428 Trade accounts receivable - intercompany 87 87 - 89 Inventories 2,279 2,279 - 2,819 Prepaid expenses 6,762 6,762 - 5,702 Deferred income tax and social contribution 5,868 - (5,868) - Recoverable taxes 13,550 13,550 - 24,680 Advances for new projects 256 256 - - Restricted cash investments - - - 96,875 Other receivables 2,977 2,977 - 4,797 Total current assets 538,112 532,244 (5,868) 1,387,678 NONCURRENTS Restricted cash investments 5,298 5,298 - 301 Collateral for agreements 98 98 - 97 Recoverable taxes 1,699 1,699 - - Prepaid expenses 510 510 - 162 Deferred income tax and social contribution 14,089 61,530 47,441 88,151 Escrow deposits 10,660 10,660 - 14,290 Other receivables 72 72 - 51 Investments 1,053 1,053 - 1,053 Property and equipament 2,298,276 27,671 (2,270,605) 48,114 Intangible assets 342,077 2,826,779 2,484,702 3,281,580 Deferred 138,914 - (138,914) - Total noncurrent assets 2,812,746 2,935,370 122,624 3,433,799 TOTAL ASSETS 3,350,858 3,467,614 116,756 4,821,477 LIABILITIES AND SHAREHOLDERS EQUITY CURRENT Loans and financing 946,883 946,883 - 938,278 Debentures - - - 296,085 Suppliers 55,076 55,076 - 71,124 Payroll taxes 33,358 33,358 - 40,810 Taxes payable 48,779 48,779 - 50,444 Deferred income tax and social contribution 1,057 - (1,057) - Payables - intercompany 895 895 - 816 Collateral for agreements 20,411 20,411 - 24,397 Proposed dividends 41,866 41,866 - 68,650 Concession fee obligations 55,194 55,194 - 59,639 Provision for highwayss maintenance - 62,474 62,474 38,990 Provision for highwayss investment - 5,078 5,078 9,474 Risks civil, labor and tax 7,264 - (7,264) - Other payables 10,958 10,958 - 38,591 Total current liabilities 1,221,741 1,280,972 59,231 1,637,298 NONCURRENT Loans and financing 847,050 847,050 - 42,758 Debentures - - - 1,511,421 Concession fee obligations 320,576 320,576 - 316,066 Deferred revenue 452 452 - 501 Deferred income tax and social contribution 10,389 17,765 7,376 28,402 Provision for highwayss maintenance - 78,756 78,756 124,331 Provision for highwayss investment - 61,252 61,252 54,840 Risks civil, labor and tax 104 7,368 7,264 10,218 Other payables 2,241 2,241 - 8,861 Total noncurrent liabilities 1,180,812 1,335,460 154,648 2,097,398 SHAREHOLDERS EQUITY Capital 549,083 549,083 - 549,083 Legal reserves 26,640 26,640 - 41,093 Profit reserves 218,575 112,244 (106,331) 283,277 Retained earnings 176,278 185,486 9,208 235,599 Adjustment to shareholders equity - exchange variation on capital (22,271) (22,271) - (22,271) Total shareholders equity 948,305 851,182 (97,123) 1,086,781 TOTAL LIABILITIES AND SHAREHOLDERS EQUITY 3,350,858 3,467,614 116,756 4,821,477
  • 20. Earnings Release 2010 March 25 th, 2011 Page 20 / 23ANNEX 2 FINANCIAL STATEMENTS OF INCOME OBRASCON HUARTE LAIN BRASIL S.A. CONSOLIDATED INCOME STATEMENT (In thousands of Brazilian reais) 2009 Adjustment 2009 IFRS 2010 IFRS Var%GROSS SERVICE REVENUE 1,301,777 670,192 1,971,969 2,342,622 18.8% Toll plazas revenue 1,292,113 - 1,292,113 1,631,185 26.2% State 840,539 - 840,539 971,562 15.6% Federal 451,574 - 451,574 659,623 46.1% Accessory revenues 9,664 - 9,664 10,424 7.9% Others - 57,102 57,102 83,186 45.7% Construct revenue - 613,090 613,090 617,827 0.8%DEDUCTIONS FROM REVENUE (112,768) (9,110) (121,878) (158,093) 29.7%NET SERVICE REVENUE 1,189,009 661,082 1,850,091 2,184,529 18.1%COST OF SERVICES (643,577) (559,429) (1,203,006) (1,385,738) 15.2%GROSS PROFIT 545,432 101,653 647,085 798,791 23.4%OPERATING (EXPENSES) INCOME (125,075) (12,830) (137,905) (146,042) 5.9% Administrative expenses (104,947) (11,527) (116,474) (130,416) 12.0% Directors compensation (9,639) (1,282) (10,921) (12,526) 14.7% Tax expenses (5,775) (21) (5,796) (2,199) -62.1% Amortization of goodwill on investments (8,133) - (8,133) (6,101) -25.0% Other operating revenues, net 3,419 - 3,419 5,200 52.1%NET FINANCIAL RESULTS (155,585) (10,311) (165,896) (217,898) 31.3%INCOME BEFORE INCOME TAX AND SOCIAL CONTRIBUTION 264,772 78,512 343,284 434,851 26.7%INCOME TAX AND SOCIAL CONTRIBUTION (88,494) (27,438) (115,932) (130,602) 12.7% Current (97,430) (16,072) (113,502) (147,243) 29.7% Deferred 8,936 (11,366) (2,430) 16,641 -784.8%NET INCOME FOR THE PERIOD 176,278 51,074 227,352 304,249 33.8%
  • 21. Earnings Release 2010 March 25 th, 2011 Page 21 / 23ANNEX 3 CASH FLOW STATEMENTS OBRASCON HUARTE LAIN BRASIL S.A. STATEMENT OF CASH FLOWS (In thousand of Brazilian reais) 2009 2009 IFRS Adjusment 2010 IFRS CASH FLOW FROM OPERATING ACTIVITIES NET INCOME 176,278 227,352 51,074 304,249 Adjusments to reconcile net income to net cash provided by operating activities: Depreciation amortization 248,480 136,596 (111,884) 175,359 Amortization of goodwill on investments 8,133 8,133 - 6,101 Writte-offs on property and equipment 5,863 1,053 (4,810) 1,879 Deferred income tax and social contribution (8,936) 2,430 11,366 (16,641) Interest and monetary variation obligations to grant - 12,764 12,764 55,148 Revenue from restricted cash investments - (262) (262) (4,454) Interest and monetary variation on loans and financing 170,196 160,175 (10,021) 111,627 Interest and monetary variation on debentures - - - 114,274 Financial expenses AVP - 9,294 9,294 7,780 Provision (reversal of) allowance for risks civil, labor and tax 4,327 4,492 165 3,061 Provision (reversal of) provision for maintenance - 3,940 3,940 15,569 Reversal of deferred revenue 23 - (23) - Decrease (increase) in assets: Trade accounts receivable (25,618) (25,692) (74) (20,287) Payables - intercompany - - (2) Inventories 1,111 1,111 - (540) Prepaid expenses (6,105) (6,105) - 1,408 Recoverable taxes (1,657) (1,657) - (8,686) Advances for new projects - (9) (9) 256 Other credits - 1,980 1,980 (1,820) Collateral for agreements - (98) (98) 1 Escrow deposits - (5,888) (5,888) (3,630) Other receivables (4,007) 74 4,081 21 Increase (decrease) in liabilities: Trade accounts payable 41,109 38,662 (2,447) (14,408) Trade accounts payable - intercompany - (83) (83) (79) Collateral for agreements (1,554) (1,554) - 3,986 Payroll taxes 12,590 12,590 - 7,452 Taxes payable (6,418) (6,418) - 1,665 Deferred revenue - 23 23 49 Other payables - (9,272) (9,272) 34,920 Concession fee obligations - 240 240 304 Risks civil, labor and tax - (619) (619) (211) Payment of interest - - - (79,979) Provision for highwayss investment (10,583) - 10,583 - NET CASH (USED IN) PROVIDED BY OPERATING ACTIVITIES 603,232 563,252 (39,980) 694,372 CASH FLOW FROM INVESTING ACTIVITIES Increase in restricted deposits 240 - (240) - Acquisition of property and equipment (786,894) (12,645) 774,249 (9,203) Increase in intangible (4,104) (738,142) (734,038) (589,078) Advances for new projects (9) - 9 - Restricted cash investments - - - (182,686) Redemption of deposits - - - 94,517 NET CASH USED IN INVESTING ACTIVITIES (790,767) (750,787) 39,980 (686,450) CASH FLOW FROM FINANCING ACTIVITIES Loans and financing Borrowings 2,050,356 2,050,356 - 187,461 Payment of interest and principal (1,458,479) (1,458,479) - (1,065,169) Debentures Debentures Issued - - - 1,781,369 Payment of interest and principal - - - (88,137) Payment of intercompany loans - - - - Payment of concession fee obligations (53,427) (53,427) - (55,517) Payment of dividends (25,007) (25,007) - (41,833) NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES 513,443 513,443 - 718,174 INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS 325,908 325,908 - 726,096 CASH AND CASH EQUIVALENTS AT BEGINNING OF THE PERIOD 116,284 116,284 - 442,192 CASH AND CASH EQUIVALENTS AT END OF THE PERIOD 442,192 442,192 - 1,168,288
  • 22. Earnings Release 2010 March 25 th, 2011 Page 22 / 23GLOSSARY State Concessionaires: Specific Purpose Companies established by the winner of the tender offer, with which the Concession Contracts were signed; their specific corporate objective is to exploit the Concession of State Toll Roads and their regulating agency is ARTESP (the São Paulo State Transportation Agency) in the State of São Paulo. OHL Brasil currently runs four state concessionaires in São Paulo (Autovias, Centrovias, Intervias and Vianorte). Federal Concessionaires: Specific Purpose Companies established by the winner of the tender offer, with which the Concession Contracts were signed; their specific corporate objective is to exploit the Concession of Federal Toll Roads and their regulating agency is ANTT (the National Agency of Transportation by Land). OHL Brasil currently runs five federal concessionaires in Brazil: (Autopista Planalto Sul, Autopista Fluminense, Autopista Fernão Dias, Autopista Régis Bittencourt and Autopista Litoral Sul). Vehicle-Equivalents: The Vehicle-Equivalent unit is used as the basis for toll tariff. A light vehicle, such as an automobile, is considered as one Vehicle-Equivalent, and a commercial vehicle (such as trucks or buses) is calculated by the number of axles which it has, been each axle counted as one light vehicle (one Vehicle-Equivalent). One light vehicle is equivalent to one axle of a commercial vehicle. Electronic Toll Collection / AVI System: The AVI system is an electronic payment system employed in the highways run by us. Motorists who use the AVI system have an electronic sensor installed on their windshield that identifies them so that the system recognizes the category of vehicle that they drive. When they go through a lane with the AVI system in the toll plaza, antennae capture the signals issued and the sensors record the vehicle‟s presence, calculating the total amount owed, without it being necessary for the motorist to stop the vehicle. Toll Readjustments: Regarding the São Paulo State Concessions, as established in the concession contract, the value of the toll tariff is readjusted in the month of July based on the fluctuation of the IGP- st M (general price index) over the 12 month period ended on the 31 of the preceding month of May. As for the adjustment of the federal concessions‟ toll tariff, it is based on the fluctuation of the IPCA consumer price index, calculated by IBGE (the Brazilian Geography and Statistic Institute), between the month before the reference date at the presentation of the toll tariff proposal, i.e., June 2007, and the month before the date when toll tariff started being charged. After this initial adjustment, the subsequent adjustments will take place annually, also based on the IPCA accrued over the last 12 months from the prior tariff. EBITDA: EBITDA is an English acronym for “Earnings Before Interest, Taxes, Depreciation and Amortization”. Fixed Concession Charge: In accordance with our concession contract, the State Concessionaires must pay the Granting Authority a fixed amount („Fixed Concession Charge‟) in exchange for being given the right to the concession. These contracts establish also that the fixed charge amount must be settled in monthly payments over the course of the concession. We have chosen to record in our assets the value of the concession granted and in our liabilities the total amount owed to the Granting Authority for the Fixed Concession Charge. Costs with the Concession Authority: These are the payments stipulated in the concession agreements. These costs are composed of: expenses with the “Variable Cahrge” for the state concessions, which corresponds to 3% of Gross Revenue at the concessions Autovias, Centrovias and Vianorte, and 3% of Toll Revenue plus 25% of Ancillary Revenue; and by costs with “Inspection Funds” and “Technological Development” at the federal concessions, which are not adjusted annually by the IPCA inflation index. Monetary Correction of the Fixed Concession Charge: The concession contracts between the State Concessionaires and the Granting Authority establish that the monthly payments of the Fixed Concession Charge will be adjusted by the IGP-M general price index, falling due as from the twelfth st month counted as from each 1 of July, on which date the toll tariffs are also adjusted by the same index. Leverage Ratio: The methodology used to define the Leverage Ratio takes into account the ratio of Net Debt (Gross Debt minus Cash and Cash Equivalent Assets) divided by EBITDA minus Fixed Debt Payment, included in the cash flow. Lower the Leverage Ratio, the greater the amount of capital that can be financed in the credit market. Deferred Charges: In the consolidated, it corresponds to the pre-operating expenses incurred by the subsidiaries that manage the concessions for federal highways until 31 December 2008 or started up date of operation, if it is earlier. The pre-operating costs will be amortized in ten years from the start of operations of the subsidiaries. From 2009, the accounting of pre-operating expenses will be made directly to result in operational costs because of the determined by the Provisional Measure n º 449/08.
  • 23. Earnings Release 2010 March 25 th, 2011 Page 23 / 23Change in Accounting Practices: On December 28, 2007, Law 11,638 was enacted, which amended,revoked and introduced new provisions to the Brazilian Corporate Law, particularly to chapter XV,regarding accounting matters. The new law took effect January 1, 2008. The main purpose of the newlaw was to update the Brazilian Corporate Law to enable convergence of accounting practices adoptedin Brazil with those of the International Financial Reporting Standards (IFRS), as well as to allow newrules and procedures to be issued by the Brazilian Securities and Exchange Commission – CVM, incompliance with international accounting standards.In addition to this process, CVM, by means of Rule 469, as of May 2, 2008, oriented publicly-heldcompanies regarding the disclosure and accounting treatment of certain changes introduced by Law11,638/07.Among the main changes brought by Law 11,638/07, which impact the Company‟s individual andconsolidated Quarterly Financial Information, is the mandatory booking at present value of significantlong-term assets and long-term liabilities, as “Concession fee obligation” and the “Concession Right”.Previously, the company booked them with a nominal value.The effects of the adjustments at present value occurred until 12/31/2007 from the amounts“Concession fee obligation” and “Concession Right” were accounted directly at the Shareholders‟ equityin 2008. Since 01/01/2008 the effects of the adjustments at present value were accounted directly at thequarter results.

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