United States
Securities and Exchange Commission
Washington, D.C. 20549
FORM 6-K
Report of Foreign Private Issuer
Pursuant To Rule 13a-16 or 15d-16
of the
Securities Exchange Act of 1934
For the month of
November 2002
Valley of the Doce River Company
(Translation of Registrant's name in English)
Avenida Graca Aranha, No. 26
20005-900 Rio de Janeiro, RJ, Brazil
(Address of principal executive office)
(Indicate by check mark whether the registrant files or will file annual reports
under cover of Form 20-F or Form 40-F.)
(Check One) Form 20-F X Form 40-F
--- ---
(Indicate by check mark whether the registrant by furnishing the information
contained in this Form is also thereby furnishing information to the Commission
pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.)
(Check One) Yes No X
--- ---
(If "Yes" is marked, indicate below the file number assigned to the registrant
in connection with Rule 12g3-2(b). 82-___.)
Companhia Vale do Rio Doce
TABLE OF CONTENTS
This Form 6-K contains the following:
Sequential
Page
Item Number
---- ------
1. Press Release titled "Performance of Companhia Vale do Rio
Doce in the Third Quarter Performance in 2002;
BR GAAP" dated November 13, 2002................. 1
2. Third Quarterly Financial Statements; BR GAAP............. 23
BR GAAP
BOVESPA: VALE3, VALE5
NYSE: RIO, RIOPR
LATIBEX: XVALO, XVALP
www.cvrd.com.br
CVRD
Investor Relations
Roberto Castelio Branco
Andreia Reis
Barbara Geluda
Daniela Tinoco
Eduardo Mello Franco
Rafael Azevedo
Tel. (5521) 3814-4540
rio@cvrd.com.br
Companhia
Vale do Rio Doce
PRESS RELEASE 3Q02
PERFORMANCE OF COMPANHIA VALE DO RIO DOCE IN THE THIRD QUARTER OF 2002
THE FINANCIAL AND OPERATIONAL INFORMATION CONTAINED IN THIS PRESS RELEASE,
EXCEPT OTHERWISE INDICATED, REFERS TO THE PARENT COMPANY AND WAS CALCULATED IN
ACCORDANCE WITH GENERALLY ACCEPTED BRAZILIAN ACCOUNTING PRINCIPLES (BRAZILIAN
GAAP). FROM THE FIRST QUARTER OF 2003, THE COMPANY WILL BE PUBLISHING QUARTERL Y
CONSOLIDATED FINANCIAL STATEMENTS IN BRAZILIAN GAAP.
Rio de Janeiro, November 13, 2002 - Companhia Vale do Rio Doce (CVRD) has
reported accumulated net earnings of R$ 502 million in the first nine months of
the year, compared to R$ 2.412 billion in the same period a year earlier. In the
third quarter of 2002 (3Q02), CVRD reported a loss of R$ 216 million,
corresponding to R$ 0.56 per share.
The depreciation of the Real against the US dollar (USD) was the main factor
behind this quarterly result, once the negative monetary variation from exchange
rate losses totalled R$ 2.122 billion and were not compensated for by an
improvement in the Company's operating results.
The rate of exchange on the last day of 3Q02, used for the calculation of
monetary variation, was R$ 3.8949 per USD, a difference of 36.9% relative to the
rate recorded on the last day of 2Q02, of R$ 2.8444 per USD. The average daily
exchange rate in 3Q02, which impacts CVRD's cash flow and operating result, was
R$ 3,1227 per USD, a difference of 25% compared to the previous quarter, of R$
2,4408 per USD.
CVRD's cash flow is positively correlated to the appreciation in the USD against
the Real, due to the asymmetry between revenues and expenses in regard to
currency composition. For example, in 3Q02 about 81% of the Company's gross
revenues were US dollar-linked while 85% of the cost of goods sold (COGS) was
denominated in Reais.
The Board of Directors of CVRD has approved the payment of interest on
shareholders equity of R$ 2.68 per share, totalling R$ 1.029 billion, which will
be paid out from December 10th, 2002. Therefore, in this year CVRD will have
distributed to its shareholders R$ 4.985 per share, totalling R$ 1.915 billion,
taking into account the amount of R$ 2.305 per share paid from April 30th, 2002.
The average dividend yield in USD of CVRD's shares in the period 1997/2001 was
6.5%, 120 basis point higher than the average yield of the 10-year US Treasury
Bond. 2002 dividend yield is estimated to be approximately the same number.
1
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Companhia
Vale do Rio Doce BR GAAP 3Q02
BR GAAP 3Q02
Gross operating revenues in 3Q02 amounted to R$ 2.340 billion, up by 27% qoq,
while gross margin was 54.5%. Revenues for the first nine months of the year
amounted to R$ 5.784 billion, 20.3% higher than the same period in 2001.
Cash generation as measured by EBITDA (earnings before interest, tax,
depreciation and amortization) amounted to R$ 1.205 billion in 3Q02, 22.2%
higher than in 3Q01 and 39.5% higher than the previous quarter. EBITDA margin,
in other words, the ratio between EBITDA and net revenues, came to 53.3% in
3Q02. This percentage is the highest in 2002 and higher than the average of
49.0% for the 19 quarters between 1Q98 and 3Q02.
The volume shipped of iron ore and pellets, of 36.925 million tons, is a new
quarterly record beating the previous record achieved in 2Q02 by 595,000 tons.
Total volume for the first nine months of the year amounted to 106.918 million
tons, compared to 96.133 million tons in the same period of the previous year.
By the same token, general cargo transportation (cargo other than iron ore and
pellets) set another new record, with CVRD railroads (Carajas and Vitoria a
Minas) handling 3.89 billion net ton kilometres (ntk). This performance began to
reflect focus on maximising the use of transportation assets, which is being
achieved through the offering of new services, such as scheduled trains, the
exploitation of intermodal connections and greater integration between CVRD's
own assets.
Capital expenditures by the Parent Company totalled US$ 155.5 million in 3Q02
and US$ 528.6 million in the first nine months of the year.
CVRD's gross consolidated revenue, calculated according to Brazilian GAAP,
amounted to R$ 10.756 billion in the period January to September 2002,
equivalent to US$ 4.015 billion. CVRD's consolidated exports totalled US$ 2.304
billion, representing 5.3% of Brazil's entire export revenue in this period.
CVRD's net exports (exports less imports) amounted to US$ 2.139 billion,
therefore making an important contribution to Brazil's current trade surplus of
US$ 7.856 billion in the first nine month of 2002. The Company's investment
program in new mining and metals projects and the expansion of existing
projects, allows the Company to look forward to growth in exports over the next
few years.
Revenue generated by foreign-based subsidiaries and affiliates amounted to US$
741 million, accounting for 18.5% of consolidated gross revenues.
RELEVANT EVENTS
CORPORATE GOVERNANCE
Continuing the implementation of the Corporate Governance model announced in
October 2001, which is based on the principles of transparency in the
decision-making process and the definition of clear roles and responsibilities,
CVRD has been developing new initiatives designed to improve corporate
governance practices. These efforts seek to emphasize the transparency of
information and the protection of investors' rights.
At the end of July 2002, the Company announced its DISCLOSURE POLICY, in
accordance with the best investor relations practices, with the main aim of
presenting a global and simultaneous spread of information to capital markets
and minimising the risk of an information imbalance.
Today, the Company is releasing three important documents.
1. DIVIDEND POLICY, which has two basic objectives: (a) increase
predictability in the distribution of dividends and/or interest on
shareholders equity; (b) increase the correlation between the remuneration
to shareholders and free cash flow performance, linking this policy more
closely to the Company's financial management. The reduction in uncertainty
is to be achieved by the announcement, until January 31 of each year, of a
minimum amount per share, denominated in USD, to be paid to shareholders in
April and October. Thus the distribution periodicity will be known and
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Companhia
Vale do Rio Doce BR GAAP 3Q02
the exchange rate risk for investors not resident in Brazil will be
eliminated, an innovative and a pioneering move by CVRD in shareholder
remuneration policy in Latin America.
2. SECURITIES TRADING POLICY, which specifies the occasions when, and the
mechanisms through which the Company's executives can trade securities
issued by CVRD and its subsidiaries, seeking to minimize the possible use
of privileged information for personal benefit.
3. CODE OF ETHICS AND STANDARDS OF PROFESSIONAL CONDUCT FOR MEMBERS OF THE
FINANCIAL AREA, which defines a code of conduct of the highest ethical
standards for the professionals in this area of the Company, who in their
business activities deal with privileged information and large sized
financial transactions.
RISK MANAGEMENT
The Board of directors of CVRD approved prudential rules for financial
investments (cash management) and commercial risk management criteria.
DIVESTITURES
The sale of the assets of Florestas Rio Doce was completed for R$ 195.3 million,
resulting in a capital gain of R$ 111 million. This transaction concludes the
divestiture of CVRD's pulp and paper assets, as determined by its strategic
directives. The forestry assets of Celmar are likely to be used in projects
linked to the mining and metals businesses, which are currently under analysis.
SHAREHOLDERS DEBENTURES
On October 4, 2002 the CVM (the Brazilian Securities Commission) authorised the
registry with the SND - Sistema Nacional de Debentures (the National Debenture
System), of Shareholders Debentures that were issued by CVRD at the time of its
privatization in 1997 as a way of guaranteeing to all its shareholders prior to
privatization, including the Brazilian government, the right to participate in
the net revenues derived from the exploration of specific mineral deposits of
the Company and some of its subsidiaries. From October 28th, 2002, the trading
of these notes was authorised by the SND. More detailed information on these
debentures can be found on CVRD's website (www.cvrd.com.br), Investor Relations
section under Shareholders Information, Debentures.
PUBLIC OFFERING FOR THE PURCHASE OF SHARES IN COMPANHIA PAULISTA DE FERRO LIGAS
On November 26, 2002 at 1.30 p.m. on Bovespa - Sao Paulo Stock Exchange, an
auction will be held to repurchase shares of Companhia Paulista de Ferro Ligas,
a ferro-alloys company controlled by CVRD. The purpose of this transaction is to
acquire the remaining 6% of the capital still owned by minority shareholders,
and subsequently delist the company. The price of the offer is R$ 15.80 per
share, corrected by the variation in the TR index (reference rate) calculated
pro rata die , from September 2nd, 2002 to the date of settlement of the auction
held on Bovespa. The price set incorporates a 45.5% premium to the average
trading price of the shares over the thirty trading days prior to the price
being set and a premium of 7.9% over the book value of the shares as at June
30th, 2002.
THE SHORT TERM OUTLOOK
Recent statistics reveal that the global economy is recovering much more slowly
than had been expected at the beginning of the year. Probably 2003 will be the
third year running of growth below the long term trend in the global economy,
which has progressed over the past three decades at an average annual rate of
3.5%. This is due, in large part, to the absence of an engine to lead global
economic expansion.
This role was played in the latter half of the nineties by the United States,
responsible for 40% of global economic growth in this period. Despite the fact
that US GDP grew by 3.1% in 3Q02, the outlook is not good. A substantial part of
this expansion in 3Q02 was explained by a rise in vehicle purchases,
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Companhia
Vale do Rio Doce BR GAAP 3Q02
stimulated by aggressive incentive policies, and leading indicators of economic
activity have been suggesting a slowdown in the growth rate. This situation has
led the Federal Reserve Bank to cut the short term interest rate by 50 basis
points to 1.25% per year, the lowest rate in nominal terms since 1961.
In the Eurozone, economic growth has been extremely modest and future
expectations are pessimistic. Recently, the IMF revised its predictions for GDP
growth in the region to 0.75% in 2002 and 2% in 2003. In Japan, the recovery
driven by external demand has losed steam. The behaviour of leading indicators
suggest that the fragile Japanese recovery has already reached its peak and a
return to recession has become increasingly probable.
China appears as an oasis of prosperity in this low expansion environment.
Export growth, investment in infrastructure and foreign direct investment are
fuelling GDP growth of 8% a year in that country. One of the consequences of the
rapid growth in China is its economy's increasing influence on mining and metals
markets, such as iron ore, steel, alumina, copper, and aluminum.
Global steel production is rising at growing rates this year. In the first nine
months of 2002, steel output was up by 5.1% in relation to the same period in
2001, and September showed an increase of 8.5% on the same month in the previous
year.
The current dynamism in the steel market has therefore been not only directly
affected by China, whose steel production is expanding at 25% a year, but also
indirectly by growth in its imports, which amounted to 17.2 million tons between
January and September, and are mainly supplied by Japan.
The International Institute for Steel and Iron (IISI) projects a 4.2% growth in
the steel global demand in 2002 and 4.9% in 2003, based mainly in the strong
Chinese demand expansion.
At the same time, there was a substantial recovery in the price of steel
products, the CRUspi index showing a variation of 35.6% between December 2001
and the end of October this year. Usually, the steel prices recovery cycle takes
from 15 to 18 months.
The pace in the seaborne demand for iron ore and pellets has seen an upturn,
with an expected increase of 20 million tons for 2002 for a forecast total of
470 million tons. The Company expects a continuation of this strong demand and
that the seaborne market will reach 490 million tons in 2003.
Chinese imports in the period January to September rose 23.8% in relation to
2001, rising from 67.1 million tons to 83.1 million tons. It is very probable
that the estimate of 110 million tons for 2002 will be met. In the first nine
months of the year, CVRD's market share in China was 16%. Japan, the world's
largest importer of iron ore, purchased 95.7 million tons in the first nine
months of the year, compared to 94.8 million in 2001.
The rise in the cost of maritime freight, also widening the freight spreads for
iron ore shipped from Brazil to China, and that shipped from Australia to China,
by some US$ 2.50 per ton, in large part reflected the strong Chinese demand for
iron ore. In the iron ore upcycle freight spreads tend to widen, and vice-versa.
The growing sophistication in Chinese steel plants, seeking to mix their
domestic ore which has a low iron content and a high level of impurities with
high quality ore, is favouring, and should continue to favour CVRD, a high
quality ore supplier. The difference in quality represents an important
compensating factor in offsetting the competitive disadvantage of geographical
distance.
In the case of aluminum, despite the recovery in demand, there has been
excessive growth in global supply. This is because various aluminum smelters,
which were shut down during the power crisis on the West Coast of the United
States, have re-started operations causing a build-up in stock levels and
keeping prices relatively low.
Furthermore, the global production capacity of primary aluminium is likely to
increase by approximately 2.5 million tons between 2003 and 2005, which will
probably prevent any vigorous price recovery, possibly forcing the closure of
smelters with a high cost of production. In this context, Albras, one of the
lowest cost producers in the world, should continue to obtain good profit
margins.
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Companhia
Vale do Rio Doce BR GAAP 3Q02
Alumina, CVRD's strategic focus in this segment, is likely to benefit from
expected growth in Chinese imports and the expansion in production capacity of
primary aluminum by companies who do not have sufficient domestic supplies of
this raw material. In January 2003, Alunorte's stage 3 should begin to operate,
increasing its annual nominal production capacity to 2.4 million tons. Alunorte
nominal production capacity can be expanded up to 6.1 million tons of alumina
per year.
SALES VOLUME AND REVENUES
Shipments of iron ore and pellets in 3Q02 reached a record level of 36.925
million tons, surpassing the previous record achieved in 2Q02 of 36.330 million
tons. Sales in 3Q02 were up 6.2% qoq. In the nine months ended on September,
sales amounted to 106.918 million tons, up 11.2% compared to the same period in
2001.
Sales of iron ore fines were responsible for 77.7% of shipments in 3Q02, lumps
accounting for 10.8% and pellets, 11.5%. In a similar vein to that which
occurred in 2Q02, pellet sales saw the highest growth, up 5.3% QoQ, compared to
growth in iron ore sales of 1.2%. This trend is reflecting the recovery in
demand for pellets, influenced by the rise in steel prices.
CVRD purchased 2.749 million tons of pellets for resale to customers from the
pellet joint ventures (Nibrasco, Itabrasco, Kobrasco and Hispanobras) compared
to 3.049 million in 2Q02. In the first nine months of the year, CVRD purchased
7.568 million tons of pellets from the joint ventures for resale to its clients,
very close to the volume purchased in the same period in 2001, 7.553 million
tons.
Sales of iron ore to China amounted to 13.6 million tons for the first nine
months of 2002 up 18.3% on the same period in 2001. In 2002, China became CVRD's
second largest iron ore market, accounting for 13% of the total, being only
surpassed by the Brazilian domestic market with a 15% share.
Sales to Europe, which accounted for some 30% of total shipments, have grown
considerably in relation to last year, up by 34.4%. This is explained
principally by the increase in shipments to Germany and Eastern European
countries.
SALES OF IRON ORE AND PELLETS - PARENT COMPANY
thousand tons
1Q 01 2Q 01 3Q 01 4Q 01 1Q 02 2Q 02 3Q 02
Iron Ore and Pellets 30,175 31,189 34,769 33,815 33,663 36,330 36,925
Iron Ore 26,546 27,038 30,996 29,983 30,379 32,289 32,668
Fines 23,512 24,226 27,617 26,044 27,016 28,648 28,687
Lump 3,034 2,812 3,379 3,939 3,363 3,641 3,981
Pellets 3,629 4,151 3,773 3,832 3,284 4,041 4,257
Railroad general cargo transportation also reached record levels in 3Q02, with
the shipment of 3.89 billion net ton kilometres (ntk). This amount is 6.4% and
16.5% higher than 2Q02 and 3Q01 figures, respectively. In addition to general
cargo, the Vitoria a Minas Railroad (EFVM) transported 1.587 million tons of
iron ore for third parties, compared to 1.401 million in 2Q02..
GENERAL CARGO RAILROAD TRANSPORTATION
million ntk
1Q 01 2Q 01 3Q 01 4Q 01 1Q 02 2Q 02 3Q 02
EF Vitoria a Minas 2,643 2,890 2,844 2,791 2,737 2,807 3,049
EF Carajas 356 543 494 423 664 848 841
TOTAL 2,999 3,433 3,338 3,214 3,401 3,655 3,890
CVRD's ports handled 5.83 million tons of general cargo in 3Q02 compared to 6.06
million tons in the previous quarter.
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Companhia
Vale do Rio Doce BR GAAP 3Q02
Railroad productivity indicators showed improvement in the quarter. EFVM
transported 0.96 million ntk per locomotive in service, per day, compared to
0.95 million in 2Q02, while on the Carajas Railroad (EFC) this index remained
constant at 1.91 million ntks. The fleet of waggons was more intensively used
for general cargo on both railroad networks. EFVM transported 5,540 ntk per
waggon in service per day in 3Q02 compared to 4,810 in 2Q02 and EFC, 16,340 ntk
compared to 15,960 in 2Q02.
Gold sales fell sharply due to the closure of the Igarape Bahia mine at the end
of the last quarter. CVRD, therefore, shipped only 63.5 troy ounces of gold in
3Q02 compared to 111.9 in 2Q02.
Potash sales were up 16.1% in relation to the previous quarter, totalling
223,000 tons. The Taquari-Vassouras mine is operating at full capacity and all
production for the year has already been reserved, the result of the strong
growth in production in Brazil's agricultural segment.
SALES OF LOGISTICS SERVICES, GOLD AND POTASH - PARENT COMPANY
thousand tons
1Q 01 2Q 01 3Q 01 4Q 01 1Q 02 2Q 02 3Q 02
Gold (troy ounces ) 108,253 114,780 144,295 141,444 115,455 111,854 63,531
Potash 133 151 124 95 113 192 223
Logistics 25,966 24,613 21,306 20,204 18,775 21,919 21,762
Railroads 16,611 16,042 14,078 13,640 13,258 14,912 14,755
Ports 9,355 8,571 7,228 6,564 5,517 7,007 7,007
Gross operating revenues amounted to R$ 2.340 billion in 3Q02, of which 81% is
denominated in USD. The export market accounted for 62.2% of sales revenues.
Overseas, the main markets were Europe, accounting for 25. 0% of revenue
generated, China 8.5% and Japan 7.8%.
Iron ore accounted for 62% of total revenues, pellets 18%, railroad
transportation 10.3% and potash 3.5%.
CVRD has stakes in two hydro-ele ctric plants under operation: Igarapava
(38.15%), with installed capacity of 210 MW, and Porto Estrela (33.33%), with
installed capacity of 112 MW, both located in the state of Minas Gerais. CVRD's
take in Igarapava is dedicated to supply the energy needs of the Southern
System, contributing to cost reductions, while the energy produced by Porto
Estrela is sold in the market. In the first nine months of 2002, revenues
derived from energy sales amounted to R$ 9 million.
GROSS REVENUES BY PRODUCT - PARENT COMPANY
million R$
3Q01 % 2Q 02 % 3Q02 %
Iron Ore 1,117 60.8% 1,117 60.6% 1,452 62.0%
Pellets 307 16.7% 290 15.7% 422 18.0%
Gold 103 5.6% 89 4.8% 63 2.7%
Railroads 195 10.6% 204 11.1% 240 10.3%
Ports 61 3.3% 67 3.6% 73 3.1%
Potash 44 2.4% 62 3.4% 81 3.5%
Others 11 0.6% 13 0.7% 10 0.4%
TOTAL 1,838 100.0% 1,842 100.0% 2,341 100.0%
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Companhia
Vale do Rio Doce BR GAAP 3Q02
GROSS REVENUES BY DESTINATION - PARENT COMPANY
million R$
3Q01 % 2Q02 % 3Q02 %
FOREIGN MARKET
Latin America 51 2.8% 67 3.6% 101 4.3%
United States 151 8.2% 92 5.0% 118 5.0%
Europe 360 19.6% 498 27.0% 584 25.0%
Middle East 94 5.1% 69 3.7% 124 5.3%
Japan 156 8.5% 150 8.1% 183 7.8%
China 215 11.7% 189 10.3% 199 8.5%
Asia. except Japan and China 102 5.5% 67 3.6% 147 6.3%
DOMESTIC MARKET 709 38.6% 711 38.6% 884 37.8%
TOTAL 1,838 100.0% 1,843 100.0% 2.340 100.0%
EXCHANGE RATE VOLATILITY GENERATES QUARTERLY LOSS
The effect of the depreciation of the Real against the US dollar on CVRD's net
liabilities denominated in foreign currency was the determining factor in
causing the loss of R$ 216 million in 3Q02, as negative monetary variation
amounted to R$ 2.122 billion.
Compared with 2Q02, net operating revenues were up by R$ 497 million, results of
investment participation grew by R$ 75 million and the sale of the assets of
Florestas Rio Doce resulted in capital gain of R$ 111 million, all these factors
helped to offset the negative effect of monetary variation.
In the quarter, results of investment participation amounted to R$ 482 million.
The results of investment participation is composed by gain on equity income,
amortization goodwill, provisions for losses and dividends received from
affiliates and subsidiaries accounted as cost. Main contributions for the
positive result of investment participation appeared in the equity income
result, from subsidiaries and affiliates in the iron ore and pellet businesses
(R$ 791 million), steel (R$ 133 million) and manganese and ferro-alloys (R$ 77
million). The aluminum area contributed with a negative equity income result of
R$ 321 million, due to the impact of exchange rate devaluation on the foreign
currency denominated debt of Albras and Alunorte.
Loss provisions were made for investments in subsidiaries and affiliates in the
amount of R$ 377 million, made necessary by the negative net worth of these
companies. Most of the provisions were made for investments in Albras (R$ 107
million), PPSA (R$ 53 million) - whose net worth turned negative as a result of
exchange rate losses - and FCA and MRS (R$ 138 million).
RESULTS OF EQUITY INVESTMENTS - BY BUSINESS AREA
million R$
BUSINESS AREA 3Q 01 2Q 02 3Q 02
Ferrous Minerals
Iron Ore and Pellets 17 528 791
Manganese and Ferro-Alloys 84 6 77
Non-Ferrous Minerals (178) (41) (52)
Logistics (364) (57) (153)
Steel 57 58 133
Aluminum (125) (127) (321)
Others 16 - 7
TOTAL (569) 407 482
The cost of goods sold (COGS) increased by R$ 56 million compared to 2Q02, due
to the increase of R$ 24 million spent on outsourced services, an increase of R$
19 million on diesel fuel and gas and R$ 18
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Companhia
Vale do Rio Doce BR GAAP 3Q02
million on materials. These costs increases are associated with the Company's
restructuring and the growth in its logistics and mining activities.
COST OF GOODS SOLD
million R$
3Q 01 % 2Q 02 % 3Q 02 %
Personnel 127 14.6% 131 13.5% 136 13.2%
Materials 109 12.6% 116 11.9% 134 13.0%
Fuel 87 10.0% 91 9.4% 110 10.7%
Electrical Energy 31 3.6% 30 3.1% 33 3.2%
Outsourced Services 122 14.1% 119 12.2% 143 13.9%
Acquisition of Products 202 23.3% 250 25.7% 258 25.1%
Depreciation and Depletion 133 15.3% 164 16.9% 155 15.1%
Others 56 6.5% 71 7.3% 59 5.7%
TOTAL 867 100.0% 972 100.0% 1,028 100.0%
Operational expenses were up by R$ 74 million QoQ, due to an increase under the
other operational expenses line, which rose from R$ 77 million to R$ 130
million. The main items of other operational expenses were: provisions for
contingencies (R$ 62 million), provisions for profit sharing plan (R$ 37
million), provisions for losses with credits against Eletrobras (R$ 29 million)
and provision for a special pension plan (R$ 20 million).
The amount spent on research and development rose by R$ 16 million, while
administrative expenses were down R$ 5 million.
The financial result worsen in 3Q02, from minus R$ 148 million in 2Q02 to minus
R$ 491 million. Contributed to this deterioration the increase of R$ 111 million
with losses with derivatives and of R$ 156 million in financial expenses with
related parties.
CVRD uses derivatives operations to set the levels of interest taxes of its
liabilities contracted with floating exchange rates and also to hedge against
gold prices fluctuations, which are registered marked to market. The decrease of
the Libor was the main driver of the losses with derivatives in this quarter.
On March 2001, CVRD transferred its 10.33% ownership in CSN's capital,
equivalent to R$ 520 million, to Valia, its employees pension fund, cancelling
actuarial deficit existent on that time. The contract celebrated between CVRD
and Valia guaranteed to the pension fund minimum return on CSN shares equal to
the variation of the General Index of Price - Internal Availability (IGP-DI),
plus 6% of interest per year. As this condition was not satisfied, CVRD made in
this quarter a provision of R$ 140 million, classified as financial expense with
related parties. Such provision can appear again in future quarters if the
profitability of CSN shares on BOVESPA (Sao Paulo Stock Exchange) are lower than
the minimum assured by CVRD to Valia in the contract.
EBITDA PERFORMANCE
EBITDA generated in 3Q02 was of R$ 1.205 billion, 39.5% higher than 2Q02 and
22.2% higher than 3Q01. EBITDA accumulated in the first nine months of the year
was R$ 2.797 billion, 14.2% higher than the one obtained in the same period of
last year.
The strong EBITDA growth in the quarter was caused by the increase of R$ 497
million in net operating revenues, determined by the increase of iron ore and
pellets sales volumes and by the depreciation of the Real. EBITDA margin was
53.3%, the third highest quarterly margin since the privatization of the
Company.
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Companhia
Vale do Rio Doce BR GAAP 3Q02
The adjustment for non cash items was R$ 82 million, composed basically by
provisions for contingencies (R$ 62 million), for special retirement plan (R$ 20
million), for credits against Eletrobras (R$ 29 million) and a reversion of
provision for losses on investments (R$ (21) million).
EBITDA COMPOSITION
million R$
3Q 02
Net Revenues 2.259
Cost of Goods Sold (1.028)
Selling Expenses (44)
General & Administrative Expenses (91)
Research & Development Expenses (47)
Other Operatiung Revenues / Expenses (130)
Adjustment for Exceptional Non-Cash Items 82
Depreciation. Depletion and Amortization 174
Dividends Received 30
EBITDA 1.205
DIVIDENDS RECEIVED
million R$
3Q 02
Hispanobras 1
MSG 2
Aluvale 22
Fosfertil 5
TOTAL 30
INVESTMENTS
In the third quarter of 2002, CVRD carried out investment of US$ 155.5 million,
bringing the accumulated total for the first nine months of the year to US$
528.6 million. This amount includes disbursements for the acquisition of total
control of the Salobo Copper Project (US$ 50.4 million)
Bearing in mind that the Company has an extensive range of projects in its main
business areas, which are scheduled to enter into operation between 2003 and
2007, and will require capital expenses of an estimated US$ 6 billion, more than
50% of the amount invested in 3Q02, US$85.2 million, was allocated to greenfield
and brownfield capacity expansion.
Of this sum, US$ 28 million was directed to the ferrous minerals, the main
investments being in the infrastructure needed for the good functioning of the
new pellet plant at Sao Luis (US$ 16.5 million), and the last steps in the
enlarging of iron ore production capacity in the Northern System to 56 million
tons. This includes construction of Pier III at Ponta da Madeira and the
construction and enlargement of the iron ore stock yards, which in 3Q02 received
investment of US$ 5.7 million and US$ 1.8 million, respectively.
The Sossego and Salobo copper projects were responsible for investment of some
US$ 28 million. Work on the Sossego project began in April 2002 and is
progressing according to schedule. The current phase of copper's economic cycle,
with relatively low prices and little expansion in capacity, contributed to
reducing the costs of developing Sossego. At the same time, the depreciation in
real terms of the Brazilian currency, has helped further to reduce the US dollar
cost of this investment, given that only 25% of the capital expenditure planned
is actually denominated in US dollars. Therefore, these two factors could reduce
the amount spent on the project, compared with the initial budget of US$ 384
million.
10
Companhia
Vale do Rio Doce BR GAAP 3Q02
In the non-ferrous segment, US$ 2.6 million was invested in enlarging the
production capacity of the Taquari-Vassouras potash mine. New capacity of
850,000 tons a year is scheduled to come on stream in the middle of 2005.
Our hydroelectric generation projects have required investment of US$ 17.5
million in the quarter. Most of this was dedicated to the building of the
hydro-electric plants at Aimores (US$ 8.4 million), Funil (US$ 5.2 million) and
Candonga (US$ 2.5 million). The Funil plant, located in the state of Minas
Gerais, which has an installed capacity of 180 MW, is programmed to start up in
December 2002.
US$ 8.5 million was invested in the logistics segment, mainly in the purchase of
locomotives and the enlarging of capacity to handle general cargo in the
Southern System.
Maintenance costs for existing operations in 3Q02 amounted to US$ 40.6 million.
The Company invested US$ 9.5 million in mineral exploration, continuing its
prospecting for new deposits of copper, nickel, gold, platinum and zinc, among
others. In addition to this, US$ 2.7 million was spent on information technology
and US$ 1.1 million on environmental protection measures.
CAPITAL EXPENDITURES - 3Q02
BY BUSINESS AREA US$ MILLION % BY CATEGORY US$ MILLION %
Ferrous minerals 68.9 44.3% Capital injections 14.9 9.6%
Logistics 24.5 15.8% Maintenance 40.6 26.1%
Non-ferrous minerals 40.6 26.1% Projects 85.2 54.8%
Energy 17.8 11.5% Mineral exploration 9.5 6.1%
Others 3.6 2.3% Environment 1.1 0.7%
Information technology 2.7 1.7%
Technological research 1.6 1.0%
TOTAL 155.5 100.0% TOTAL 155.5 100.0%
CAPITAL EXPENDITURES - 9M 02
BY BUSINESS AREA US$ MILLION % BY CATEGORY US$ MILLION %
Ferrous minerals 265.1 50.2% Capital injections 25.8 4.9%
Logistics 63.3 12.0% Maintenance 130.3 24.6%
Non-ferrous minerals 71.3 13.5% Projects 281.0 53.2%
Energy 68.0 12.9% Mineral exploration 22.7 4.3%
Others 10.4 2.0% Environment 4.7 0.9%
TOTAL 478.2 90.5% Information technology 9.2 1.7%
Acquisitions 50.4 9.5% Technological research 4.6 0.9%
TOTAL 528.6 100.0% TOTAL 478.2 90.5%
Acquisitions 50.4 9.5%
TOTAL 528.6 100.0%
MINERAL EXPLORATION AND TECHNOLOGY
In 2002, CVRD's mineral exploration and technology activities underwent
reorganization, coming under control of the Department for the Development of
Mineral Projects. This department aims to develop new businesses and projects
for the Company, with a view to its long term growth.
11
Companhia
Vale do Rio Doce BR GAAP 3Q02
CVRD's mineral exploitation program is distributed into three main areas:
Carajas, other regions in Brazil and abroad. Investment in the first nine months
of 2002 amounted to US$ 38 million, including a tranche of US$ 15 million from
the BNDES, referring to the Mineral Risk Contract.
This exploration program gives priority to the mineral province of Carajas,
where 75% of efforts are concentrated, the main focus being the development of
the copper projects (Sossego, 118, Cristalino, Alemao and Salobo), as well as
the identification of new deposits of copper and gold. Investment is also being
made in the Niquel do Vermelho project, which is in the pre-feasibility stage,
with tests ongoing in a pilot plant and actions designed to minimize risk.
Additionally, prospecting programs are ongoing in the search for nickel, and
platinum group metals(PGMs), all still in their initial stages.
In terms of mineral exploration outside Brazil, the initial focus is the
copper-bearing province of Cordilheira dos Andes, with opportunities being
looked at in Argentina, Chile, Peru and Equador. In this context, CVRD and
Antofagasta Plc, one of the main copper producers in Chile, have formed a joint
venture company, Cordillera de las Minas S.A., whose aim is to carry out mineral
prospecting and extraction in the south of Peru, near Cuzco. The area of
interest covers an approximate total of 60,000 square kilometres. Other
significant mining enterprises are located in this region and there is a great
potential for rich mineral deposits.
12
Companhia
Vale do Rio Doce BR GAAP 3Q02
SELECTED FINANCIAL INDICATORS
million R$
3Q 01 2Q 02 3Q 02
Gross Revenues 1,839 1,843 2,340
Gross Margin (%) 51.2 44.8 54.5
Net Income 1,206 85 (216)
Net Income per Share (R$) 3.14 0.22 (0.56)
EBITDA 986 864 1,205
EBITDA Margin (%) 55.5 49.0 53.3
ROE annualized (%) 43.2 11.8 6.0
Investments (US$ million) * 158 165 156
* acquisitions not included
FINANCIAL STATEMENT
million R$
3Q 01 2Q 02 3Q 02
Gross Operating Revenues 1,839 1,843 2,340
Value Added Tax (61) (81) (81)
NET OPERATING REVENUES 1,778 1,762 2,259
Cost of Goods Sold (867) (972) (1,028)
GROSS INCOME 911 790 1,231
Gross Margin (%) 51.2 44.8 54.5
RESULT OF INVESTMENT PARTICIPATION (569) 407 482
Equity Income (5) 626 962
Goodwill Amortization (295) (104) (108)
Provision for Losses (269) (115) (377)
Others - - 5
OPERATING EXPENSES (400) (238) (312)
Selling (32) (35) (44)
General & Administrative (90) (95) (91)
Research and Development (30) (31) (47)
Others (248) (77) (130)
FINANCIAL RESULTS (686) (1,146) (2,613)
Financial Expenses (239) (186) (495)
Financial Revenues 24 38 4
Monetary Variation (471) (998) (2,122)
OPERATING INCOME (744) (187) (1,212)
Discontinued Operations 1,473 - 111
Income Taxes 477 272 885
NET INCOME 1,206 85 (216)
NET INCOME PER SHARE (R$) 3.14 0.22 (0.56)
13
Companhia
Vale do Rio Doce BR GAAP 3Q02
EQUITY INCOME
million R$
COMPANY/PARTICIPATION % 3Q 01 2Q 02 3Q 02
DOCENAVE 100.00 (79) 34 56
ALUVALE 94.74 (121) (133) (179)
FLORESTAS 99.85 4 2 2
RDE 99.80 72 220 1,024
ITACO 99.99 263 486 47
RDI 100.00 2 - 4
URUCUM 100.00 6 13 5
TERM,VILA VELHA 99.89 2 - 3
NORPEL 99.90 (1) 1 -
PARA PIGMENTOS 75.50 - (5) -
SAMITRI 100.00 (31) - -
SIBRA 99.23 6 23 47
FERTECO 100.00 (107) 19 44
BELEM 99.99 - (2) (1)
MSE 99.99 - 1 1
KSG 99.99 - 1 -
BRASAMERICAN LIMITED 99.70 - 7 15
BRASILUX 100.00 - 20 8
TOTAL FROM SUBSIDIARIES 16 687 1,076
MSG 51.00 3 2 3
CST 22.85 - (29) (11)
NIBRASCO 51.00 (18) 3 2
FOSFERTIL 11.12 4 1 10
HISPANOBRAS 50.89 5 1 5
ITABRASCO 50.90 2 3 6
NOVA ERA SILICON 49.00 - - 1
USIMINAS 11.46 - (26) (83)
KOBRASCO 50.00 (16) (9) -
FERROBAN 3.75 (1) - (1)
SAMARCO 50.00 - (10) (36)
BAOVALE 50.00 - 3 (3)
TOTAL FROM AFFILIATES (21) (61) (107)
ELETROBRAS ADJUST (7)
TOTAL FROM EQUITY INCOME (5) 626 962
14
Companhia
Vale do Rio Doce BR GAAP 3Q02
COMPANY/PARTICIPATION % 3Q 01 2Q 02 3Q 02
PROVISION FOR LOSSES
VALEPONTOCOM 100.00 - - (7)
KOBRASCO 50.00 (19) (16) (46)
CIA.FERROV.NORDESTE 32.40 (33) (2) (3)
DOCEPAR 100.00 (5) (5) (6)
FCA 45.65 (108) (20) (105)
PARA PIGMENTOS 75.50 (104) (35) (53)
MRS 17.26 - (33) (33)
FERROBAN 3.75 - (4) 4
ALBRAS 51.00 - - (107)
SEPETIBA TECON 50.00 - - (21)
TOTAL FROM PROVISION FOR LOSSES (269) (115) (377)
GOODWILL AMORTIZATION
FCA 45.65 (138) (18) (37)
GIIC (GULF) 50.00 (60) - -
PARA PIGMENTOS 75.50 (75) - -
CPFL 93.60 - (1) -
SIBRA 99.23 (20) (19) (20)
USIMINAS 11.46 (2) - -
CAEMI 16.86 - (14) (12)
BELEM 99.99 - (3) (2)
MRS 17.26 - (14) (3)
FERTECO 100.00 - (35) (34)
TOTAL FROM GOODWILL AMORTIZATION (295) (104) (108)
Gain on assets disposal and dividends - - 5
TOTAL (569) 407 482
EQUITY PARTICIPATION ON DOCENAVE % 3Q 01 2Q 02 3Q 02
NAVEDOCE/Seamar 100.00 - (2) (3)
Own operations 100.00 (157) (34) (83)
NAVEDOCE/Seamar (G/L Foreign Exchange) 100.00 78 70 142
TOTAL DOCENAVE (79) 34 56
EQUITY PARTICIPATION ON ALUVALE % 3Q 01 2Q 02 3Q 02
ALUNORTE 57.58 (60) (64) (154)
MRN 40.00 21 3 (3)
ALBRAS 51.00 (100) (95) (164)
VALESUL 54.51 7 9 12
Equity on Alunorte - 2 2
Own operations 5 5 7
TOTAL ALUVALE (127) (140) (300)
15
Companhia
Vale do Rio Doce BR GAAP 3Q02
EQUITY PARTICIPATION ON ITACO % 3Q 01 2Q 02 3Q 02
US$ million
CSI 50.00 (2) 6 6
RDL 100.00 (1) 3 4
RDA 100.00 - - -
RDME 100.00 2 2
CSN Aceros 62.50 - (10)
Caemi 16.86 (13) (1)
Aluvale 5.26 (3) (4)
GIIC (GULF) 50.00 1 -
CVRD Overseas 100.00 (1) 20 9
Quadrem 9.00 1 - -
Own operations 6 27 (33)
G/L Exchange (1) 108 (27)
TOTAL ITACO 24 151 (54)
EQUITY PARTICIPATION ON FERTECO % 3Q 01 2Q 02 3Q 02
Own operations 100.00 8 19 45
MRS 10.89 (13) (21) (20)
Zagaia (102) (8) (8)
TOTAL FERTECO (107) (10) 17
BALANCE SHEET
million R$
3Q 01 2Q 02 3Q 02
ASSETS
Current Assets 5,281 4,552 6,412
Long Term Assets 2,316 3,241 3,425
Permanent Assets 15,986 17,032 17,997
TOTAL 23,584 24,825 27,834
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities 5,074 4,167 5,199
Long Term Liabilities 7,336 8,532 11,396
Shareholders' Equity 11,174 12,126 11,239
Capital 4,000 5,000 5,000
Reserves 7,174 7,126 5,713
TOTAL 23,584 24,825 27,834
16
Companhia
Vale do Rio Doce BR GAAP 3Q02
IRON ORE AND PELLETS SALES - PARENT COMPANY
million tons
FOREIGN MARKET 3Q 01 2Q 02 3Q 02
ASIA
China 2.8 5.0 4.2
South Korea 1.6 1.1 2.0
Philippines 0.2 0.5 0.7
Japan 4.1 4.3 4.0
Taiwan 0.2 0.4 0.5
Others - - -
TOTAL 8.9 11.3 11.4
EUROPE
Germany 2.3 3.4 3.6
Spain 0.8 0.7 0.7
France 1.3 1.5 1.4
Italy 1.5 2.2 0.8
United Kingdom 0.4 0.4 0.8
Others 2.2 3.2 3.6
TOTAL 8.5 11.4 10.9
AMERICAS
Argentina 0.5 0.6 0.6
United States 0.5 1.0 1.2
Others 0.5 0.5 0.7
TOTAL 1.5 2.1 2.5
AFRICA/MIDDLE EAST /
AUSTRALASIA
Bahrain 0.8 0.5 0.6
Others 1.5 0.7 1.2
TOTAL 2.3 1.2 1.8
TOTAL 21.2 26.0 26.6
DOMESTIC MARKET 3Q 01 2Q 02 3Q 02
Steel Mills 4.9 5.7 5.3
Affiliated 5.0 4.6 5.0
Pelletizing Companies
TOTAL 9.9 10.3 10.3
TOTAL 31.1 36.3 36.9
GENERAL CARGO RAILROAD TRANSPORTATION - FCA
million ntk
1Q 01 2Q 01 3Q 01 4Q 01 1Q 02 2Q 02 3Q 02
Ferrovia Centro Atlantica 1,962 2,236 2,167 1,993 1,832 2,253 2,209
17
Companhia
Vale do Rio Doce BR GAAP 3Q02
IRON ORE AND PELLETS - FINANCIAL INDICATORS - NON AUDITED
million R$
HISPANOBRAS 3Q 01 2Q 02 3Q 02
Sales (thousand 882 835 686
tons)
Foreign Market 422 355 166
Domestic Market 460 480 520
Net Operating 73 59 67
Revenues
Cost of Goods Sold (60) (56) (57)
Financial Results 4 6 8
Net Earnings 10 2 10
Gross Margin (%) 17.8 5.1 14.9
EBITDA 17 5 13
EBITDA Margin (%) 23.3 8.5 19.4
NIBRASCO 3Q 01 2Q 02 3Q 02
Sales (thousand 1,443 2,257 1,842
tons)
Foreign Market 514 686 290
Domestic Market 929 1,571 1,552
Net Operating 109 164 162
Revenues
Cost of Goods Sold (102) (144) (148)
Financial Results (8) (4) (2)
Net Earnings (34) 6 4
Gross Margin (%) 6.4 12.2 8.6
EBITDA 24 26 19
EBITDA Margin (%) 22.0 15.9 11.7
GROSS DEBT (IN
US$ MILLION)
- Short Term 2 2 2
- Long Term 5 2 2
TOTAL 7 4 5
ITABRASCO 3Q 01 2Q 02 3Q 02
Sales (thousand 742 702 815
tons)
Foreign Market 471 533 572
Domestic Market 271 169 243
Net Operating 59 50 80
Revenues
Cost of Goods Sold (52) (48) (67)
Financial Results 2 9 13
Net Earnings 4 5 13
Gross Margin (%) 11.9 4.0 16.3
EBITDA 10 3 10
EBITDA Margin (%) 16.9 6.0 12.5
GROSS DEBT (IN
US$ MILLION)
- Short Term 1 17 15
18
Companhia
Vale do Rio Doce BR GAAP 3Q02
IRON ORE AND PELLETS - FINANCIAL INDICATORS - NON AUDITED
million R$
KOBRASCO 3Q 01 2Q 02 3Q 02
Sales (thousand 1,123 1,012 850
tons)
Foreign Market 493 534 850
Domestic Market 630 478 -
Net Operating 91 72 74
Revenues
Cost of Goods Sold (68) (67) (60)
Financial Results (52) (78) (147)
Net Earnings (72) (49) (92)
Gross Margin (%) 25.3 6.9 18.9
EBITDA 24 9 14
EBITDA Margin (%) 26.4 12.5 18.9
GROSS DEBT (IN
US$ MILLION)
- Short Term - - -
- Long Term 129 143 147
TOTAL 129 143 147
SAMARCO 3Q 01 2Q 02 3Q 02
Sales (thousand 2,312 3,436 3,871
tons)
Net Operating 167 239 311
Revenues
Cost of Goods Sold (73) (115) (138)
Financial Results (98) (96) (162)
Net Earnings (48) (19) (73)
Gross Margin (%) 56.3 51.9 55.6
EBITDA 86 114 155
EBITDA Margin (%) 51.5 47.7 49.8
GROSS DEBT (IN
US$ MILLION)
- Short Term 158 180 170
- Long Term 119 87 76
TOTAL 277 267 246
FERTECO 3Q 01 2Q 02 3Q 02
Sales (thousand 4,011 4,777 5,620
tons)
Foreign Market 3,556 3,434 3,335
Domestic Market 455 1,343 2,285
Net Operating 176 195 302
Revenues
Cost of Goods Sold (87) (128) (187)
Financial Results (76) (44) (59)
Net Earnings (5) (10) 24
Gross Margin (%) 50.6 34.4 38.1
EBITDA 67 63 104
EBITDA Margin (%) 38.1 32.3 34.4
GROSS DEBT (IN
US$ MILLION)
- Short Term 72 58 52
- Long Term 103 88 74
TOTAL 175 146 126
19
Companhia
Vale do Rio Doce BR GAAP 3Q02
IRON ORE AND PELLETS - FINANCIAL INDICATORS - NON AUDITED
Thousand US$
GIIC* 3Q 01 2Q 02 3Q 02
Sales (thousand 661 676 643
tons)
Net Operating 35,151 27,228 26,720
Revenues
Cost of Goods Sold (32,104) (23,737) (24,939)
Gross Profit 3,047 3,491 1,781
Other Income 427 79 188
S G & A (1.144) (2,028) (192)
Net Income 2,330 1,542 1,777
* financial indicators according to IASC (International
Accounting Standards Committee).
ITACO 3Q 01* 2Q 02 3Q 02
Sales (thousand
tons)
Iron Ore 13,796 16,650 16,805
Pellets 1,966 2,513 2,267
Manganese 260 250 206
Bauxite 162 407 398
Alumina 42 106 -
Aluminum 35 53 49
Net Operating 384,594 473,753 419,677
Revenues
Cost of Goods Sold (348,026) (434,940) (394,946)
Equity Income 24,155 (46,637) (71,381)
Net Income 546.832 (37,427) (125,966)
EBITDA 571.637 32,833 (10,974)
* inludes sale of Cenibra
20
Companhia
Vale do Rio Doce BR GAAP 3Q02
MANGANESE AND FERRO-ALLOYS - FINANCIAL INDICATORS - NON AUDITED
million R$
SIBRA 3Q 01 2Q 02 3Q 02
Sales - 21 31 52
Ferro-alloys
(thousand tons)
Foreign Market 7 15 33
Domestic Market 14 16 19
Average Price 460.70 439.85 402.46
(US$/ton)
Sales - Manganese 306 265 275
(thousand tons)
Foreign Market 284 213 181
Domestic Market 22 52 94
Average Price 49.13 47.75 46.81
(US$/ton)
Net Operating 16 60 99
Revenues
Cost of Goods Sold (10) (36) (60)
Financial Results 1 (5) 8
Net Earnings 6 22 46
Gross Margin (%) 37.5 40.0 39.4
EBITDA 9 21 33
EBITDA Margin (%) 56.3 35.0 33.3
GROSS DEBT (IN
US$ MILLION)
- Short Term 20 23 20
- Long Term 44 21 19
TOTAL 64 44 39
CPFL 3Q 01 2Q 02 3Q 02
Sales (thousand 28 37 55
tons)
Foreign Market 14 17 34
Domestic Market 14 20 21
Average Price 868.73 569.36 469.53
(US$/ton)
Net Operating 47 47 74
Revenues
Cost of Goods Sold (35) (34) (46)
Financial Results (1) 1 6
Net Earnings 7 10 17
Gross Margin (%) 25.5 27.7 37.8
EBITDA 12 9 20
EBITDA Margin (%) 25.5 19.1 27.0
GROSS DEBT (IN
US$ MILLION)
- Short Term 8 6 4
- Long Term 9 4 4
TOTAL 17 10 8
21
Companhia
Vale do Rio Doce BR GAAP 3Q02
ALUMINUM - SELECTED FINANCIAL INDICATORS - ADJUSTED AND NON AUDITED
million R$
MRN 3Q 01 2Q 02 3Q 02
Sales (thousand 2,760 2,610 2,555
tons)
Foreign Market 954 790 740
Domestic Market 1,806 1,820 1,815
Average Price 20.99 18.34 18.46
(US$/ton)
Net Operating 139 111 147
Revenues
Cost of Goods Sold (60) (61) (73)
Financial Results (3) (32) (74)
Net Earnings 52 8 (7)
Gross Margin (%) 56.8 45.0 50.0
EBITDA 88 59 87
EBITDA Margin (%) 63.3 53.2 59.6
GROSS DEBT (IN
US$ MILLION)
- Short Term 12 19 23
- Long Term 8 90 78
TOTAL 20 109 101
ALUNORTE 3Q 01 2Q 02 3Q 02
Sales (thousand 409 410 348
tons)
Foreign Market 249 175 115
Domestic Market 160 235 233
Average Price 184.94 165.72 170.13
(US$/ton)
Net Operating 177 174 196
Revenues
Cost of Goods Sold (122) (135) (131)
Financial Results (157) (198) (374)
Net Earnings (128) (142) (307)
Gross Margin (%) 31.1 22.4 33.2
EBITDA 64 49 74
EBITDA Margin (%) 36.2 28.2 37.8
GROSS DEBT (IN
US$ MILLION)
- Short Term 20 - -
- Long Term 429 455 473
TOTAL 449 455 473
ALBRAS 3Q 01 2Q 02 3Q 02
Sales (thousand 80 110 104
tons)
Foreign Market 76 108 101
Domestic Market 4 2 3
Average Price 1,390.89 1,332.13 1,289.68
(US$/ton)
Net Operating 278 366 414
Revenues
Cost of Goods Sold (161) (224) (249)
Financial Results (252) (333) (505)
Net Earnings (196) (186) (322)
Gross Margin (%) 42.1 38.8 39.9
EBITDA 89 150 160
EBITDA Margin (%) 32.0 41.0 38.6
GROSS DEBT (IN
US$ MILLION)
- Short Term 137 49 20
- Long Term 497 507 499
TOTAL 634 556 519
22
Companhia
Vale do Rio Doce BR GAAP 3Q02
ALUMINUM - SELECTED FINANCIAL INDICATORS - ADJUSTED AND NON AUDITED
million R$
VALESUL 3Q 01 2Q 02 3Q 02
Sales (thousand 18 23 19
tons)
Foreign Market 7 12 8
Domestic Market 11 11 11
Average Price 1,784.68 1,663.20 1,654.96
(US$/ton)
Net Operating 77 93 94
Revenues
Cost of Goods Sold (55) (72) (62)
Financial Results (9) 1 (1)
Net Earnings 12 15 20
Gross Margin (%) 28.6 22.6 34.0
EBITDA 28 24 28
EBITDA Margin (%) 36.4 25.8 29.8
GROSS DEBT (IN
US$ MILLION)
- Short Term 1 1 1
- Long Term 3 1 0
TOTAL 4 2 1
--------------------------------------------------------------------------------
"This press release may contain statements that express management's
expectations about future events or results rather than historical facts. These
forward-looking statements involve risks and uncertainties that could cause
actual results to differ materially from those projected in forward-looking
statements, and CVRD cannot give assurance that such statements will prove
correct. These risks and uncertainties include factors: relating to the
Brazilian economy and securities markets, which exhibit volatility and can be
adversely affected by developments in other countries; relating to the iron ore
business and its dependence on the global steel industry, which is cyclical in
nature; and relating to the highly competitive industries in which CVRD
operates. For additional information on factors that could cause CVRD's actual
results to differ from expectations reflected in forward-looking statements,
please see CVRD's reports filed with the Comissao de Valores Mobiliarios and the
U.S. Securities and Exchange."
CONTENTS
PART I 3
1 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE OPERATING RESULTS FOR THE NINE
MONTHS ENDED SEPTEMBER 30, 2002 COMPARED WITH THE NINE MONTHS ENDED
SEPTEMBER 30, 2001 3
1.1 - General Aspects 3
1.2 - Comments on the Consolidated Results 4
1.2.1- Consolidated Gross Revenue 4
1.2.2- Consolidated Cost of Products and Services 5
1.3 - Comments on the Parent Company Results 5
1.3.1- Gross Revenues 5
1.3.2- Cost of Products and Services 6
1.3.3- Result of Shareholdings by Business Area 7
1.3.4- Operating Expenses 9
1.3.5- Net Financial Result 9
1.3.6- Discontinued Operations 9
1.3.7- Cash Flow 9
1.3.8- Income Tax and Social Contribution 9
PART II 10
QUARTERLY INFORMATION AND NOTES TO THE QUARTERLY INFORMATION 10
2 - BALANCE SHEET 10
3 - STATEMENT OF INCOME 11
4 - STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY 12
5 - STATEMENT OF CASH FLOWS (ADDITIONAL INFORMATION) 13
6 - NOTES TO THE QUARTERLY INFORMATION AT SEPTEMBER 30, 2002 AND 2001 14
6.1 - Operations 14
6.2 - Presentation of Financial Statements 14
6.3 - Significant Accounting Policies 14
6.4 - Cash and Cash Equivalents 14
6.5 - Accounts Receivable from Customers 15
6.6 - Transactions with Related Parties 15
6.7 - Inventories 16
6.8 - Deferred Income Tax and Social Contribution 16
6.9 - Investments 18
6.10- Property, Plant and Equipment 21
6.11- Loans and Financing 22
6.12- Securitization Program 23
6.13- Contingent Liabilities 24
6.14- Environmental and Site Reclamation and Restoration Costs 26
6.15- Pension Plan - VALIA 26
6.16- Capital 27
6.17- American Depositary Receipts (ADR) Program 27
6.18- Treasury Stock 28
6.19- Financial Result 28
6.20- Financial Instruments - Derivatives 28
6.21- Exchange Rate Exposure 30
6.22- Other Operating Expenses 30
CVRD 1
PART III 31
6.23- Subsequent Events 30
7 - OTHER INFORMATION THE COMPANY DEEMS RELEVANT 31
7.1 - Net Accumulated Income (in R$ Million) 31
7.2 - Factors Affecting Net Income in the Last 12 Months (in R$ Million) 31
7.3 - Business Performance Ratios 32
7.4 - Segment and Geographic Information 32
7.5 - Share Performance on Stock Exchanges (Non-Audited) 34
7.6 - Capital Expenditures (Non-Audited) 34
7.7 - Operations for the period (Non-Audited) 35
7.8 - Changes in Prices (Non-Audited) 35
7.9 - Iron Ore and Pellet Sales (Main Markets) (Non-Audited) 36
7.10- Shareholding Interests (Organizational Chart at 09/30/02) 37
7.11- Information About FERTECO (Non-Audited) 38
7.12- Information About RDIF (Non-Audited) 39
PART IV 40
8 - ATTACHMENT I - EQUITY INVESTEE INFORMATION 40
8.1 - Aluminum Area - ALBRAS (Adjusted and Non-Audited) 40
8.2 - Aluminum Area - ALUNORTE (Adjusted and Non-Audited) 41
8.3 - Aluminum Area - ALUVALE (Adjusted and Non-Audited) 42
8.4 - Aluminum Area - MRN (Adjusted and Non-Audited) 43
8.5 - Aluminum Area - VALESUL (Adjusted and Non-Audited) 44
8.6 - Pelletizing Affiliates - HISPANOBRAS (Adjusted and Non-Audited) 45
8.7 - Pelletizing Affiliates - ITABRASCO (Adjusted and Non-Audited) 46
8.8 - Pelletizing Affiliates - KOBRASCO (Adjusted and Non-Audited) 47
8.9 - Pelletizing Affiliates - NIBRASCO (Adjusted and Non-Audited) 48
8.10- Pelletizing Affiliates - SAMARCO (Adjusted and Non-Audited) 49
8.11- Iron Ore Area - FERTECO (Adjusted and Non-Audited) 50
8.12- Manganese and Ferroalloys Area - SIBRA (Adjusted and Non-Audited) 51
8.13- Manganese and Ferroalloys Area - CPFL (Adjusted and Non-Audited) 52
9 - OPINION OF THE INDEPENDENT ACCOUNTANTS 53
10- MEMBERS OF THE BOARD OF DIRECTORS, AUDIT COMMITTEE, CHIEF EXECUTIVE OFFICER,
CHIEF FINANCIAL OFFICER AND EXECUTIVE OFFICERS 54
2 CVRD
PART I
Expressed in thousands of reais
1- MANAGEMENT'S DISCUSSION AND ANALYSIS OF THE OPERATING RESULTS FOR THE
NINE MONTHS ENDED SEPTEMBER 30, 2002 COMPARED WITH THE NINE MONTHS ENDED
SEPTEMBER 30, 2001
1.1- General Aspects
(a) The Company's segments of business are mining, logistics and energy, as
follows:
o Ferrous minerals: includes iron ore and pellets as well as
manganese and ferroalloys;
o Non-ferrous minerals: includes gold, kaolin, potash and copper;
o Logistics: includes railroads, ports and maritime terminals and
shipping;
o Energy: includes electric power generation; and
o Shareholdings: includes equity holdings in producers of aluminum,
steel and fertilizers.
(b) The variations of the main currencies and indices at 09/30/02 and
09/30/01 in terms of percentages in relation to the real, which impacted
the results of the Company and its subsidiaries, jointly controlled
companies and affiliates, were as follows:
/\ % Currencies/Indexes Parity
----------------------- ------
Period U.S. YEN GOLD IGPM TJLP US$xR$ US$xYen
------ ---- --- ---- ---- ---- ------ -------
9/30/02 67.9 80.8 26.6 10.5 7.3 2.8949 121.87
9/30/01 36.6 30.9 6.8 7.7 6.9 2.6713 119.68
12/31/01 18.7 3.7 1.2 10.4 9.5 2.3204 131.30
12/31/00 9.3 (2.2) (5.4) 10.0 10.8 1.9554 114.70
About 62% of the Company's gross revenue on 09/30/02 (57% of the consolidated
revenue) is derived from exports and part of domestic sales are denominated in
U.S. dollars, while the costs are in mainly incurred in reais. Consequently,
fluctuations in the exchange rate between the two currencies have a significant
impact on the operating cash flows;
Approximately 95% of the short-term and long-term loans of the Company on
09/30/02 are denominated in U.S. dollars. As a result, exchange rate
fluctuations have a significant impact on the financial expenses (Notes 6.11 and
6.19);
CVRD 3
1.2- Comments on the Consolidated Results
1.2.1- Consolidated Gross Revenue
The following table shows sales volume and revenues by products and services at
09/30/02:
In thousands
of metric tons In thousands
(except gold) of reais
------------- --------
Iron ore 103,281 4,049,440
Pellets 19,284 1,991,511
-------- ----------
122,565 6,040,951
Railroad transportation 47,807 693,073
Sea transportation (see volumes note 7.7) - 139,754
Port services 22,707 267,126
Gold (kg) 9,046 232,030
Manganese and Ferroalloys 901 606,640
Potash 528 181,468
Steel 1,239 1,083,370
Aluminum (see volumes note 7.7) - 1,306,305
Kaolin 320 153,011
Other products and services - 51,912
-------- ----------
10,755,640
==========
30/09/02 - R$ 10,755,640 / US$ 4,014,918
PER MARKET PER PRODUCT PER CURRENCY (*)
------------------------------------- -------------------------------- ----------------------
EM From Brazil 75% R$ 6,173,548 Iron ore ................ 38% R$........13%
US$ 1,864,837 US$.......87%
Pellets ................. 18%
IM From Abroad 25% R$ 1,982,833
US$ 7 40,161 Aluminum ................ 12%
US$ (*)
R$ 1,184,483 Steel ................... 10%
US$ 442,149
R$ Transport ............... 10%
R$ 1,414,776
US$ 528,117 Manganese and
ferro-alloys ............ 6%
Potash, kaolin and others 4%
Gold .................... 2%
(*) Part of sales to the internal market are in U.S. dollars.
4 CVRD
1.2.2- Consolidated Cost of Products and Services
By category
1.2.2- Consolidated Cost of Products and Services
By category
09/30/02
--------
Personnel 712,359
Material 1,038,955
Oil and gas 559,352
Outsourced services 797,496
Energy 406,278
Acquisition of products 735,801
Depreciation and depletion 770,765
Others 672,681
---------
Total 5,693,687
=========
1.3- Comments on the Parent Company Results
The net income of the Company for the period was R$ 502,212 (net income of R$
718,388 in the first six months and loss of R$ 216,176 in the third quarter), a
79.2% decrease compared with the R$ 2,411,580 in the third quarter of 2001,
reducing the earnings per share to R$ 1.31 on 09/30/02 from R$ 6.28 on 09/30/01.
The 2002 results include a gain on discontinued operations due to sale of the
holding in Florestas Rio Doce in the amount of R$ 110,693, and in 2001 includes
a gain on investments in the amount of R$ 1,770,516, basically due to the sale
of Bahia Sul and Cenibra.
1.3.1- Gross Revenues
Gross revenues increased 20.3% (from R$ 4,806,738 on 09/30/01 to R$ 5,784,506 on
09/30/02), this reflects the strengthening of the dollar against the real (83%
of revenues are linked to the U.S. dollar) as well as growth in iron ore and
potash sales volumes. The increase in iron ore sales is due to growth of the
Chinese and European markets as well as mining operations previously belonging
to Samitri. However, these events resulted in a decrease in gross revenue from
railroad transport and port services, since CVRD ceased to sell these services
to that company and absorbed related costs as part of its own activities.
The following table shows sales volume and revenues by products and services:
In thousands of metric
tons (except gold) In millions of reais
09/30/02 09/30/01 /\% 09/30/02 09/30/01 /\%
-------- -------- --- -------- -------- ---
External market
Iron ore 67,512 56,320 19.9 2,631,019 1,937,398 35.8
Pellets 9,553 9,565 (0.1) 731,335 641,888 13.9
------- ------- ------- --------- --------- ----
77,065 65,885 17.0 3,362,354 2,579,286 30.4
------- ------- ------- --------- --------- ----
Internal market
Iron ore 27,824 28,260 (1.5) 927,185 810,200 14.4
Pellets 2,029 1,988 2.1 226,657 199,370 13.7
------- ------- ------- --------- --------- ----
29,853 30,248 (1.3) 1,153,842 1,009,570 14.3
------- ------- ------- --------- --------- ----
Total
Iron ore 95,336 84,580 12.7 3,558,204 2,747,598 29.5
Pellets 11,582 11,553 0.3 957,992 841,258 13.9
------- ------- ------- --------- --------- ----
106,918 96,133 11.2 4,516,196 3,588,856 25.8
------- ------- ------- --------- --------- ----
Railroad transportation 42,925 46,731 (8.1) 632,132 624,955 1.1
Port services 19,531 25,154 (22.4) 182,443 171,478 6.4
Gold (kg) 9,046 11,425 (20.8) 232,030 232,470 (0.2)
Potash 528 408 29.4 181,468 132,463 37.0
Other products and services - - - 40,237 56,516 (28.8)
------- ------- -------- --------- --------- ----
5,784,506 4,806,738 20.3
========= =========
CVRD 5
PER MARKET PER PRODUCT PER CURRENCY (*)
------------------------------------- -------------------------------- ----------------------
EM 62% R$ 3,554,383 Iron ore ................ 62% R$........17%
US$ 1,340,739 US$.......83%
Pellets ................. 17%
IM 38% US$ (*)
R$ 1,255,004 Logistics................ 14%
US$ 456,279
R$ Gold .................... 4%
R$ 965,119
US$ 359,267 Potash, and others 3%
(*) Part of sales to the internal market are in U.S. dollars.
1.3.2- Cost of Products and Services
The increase of 19.7% in the cost of products and services (from R$ 2,383,239 on
09/30/01 to R$ 2,852,228 on 09/30/02) is due principally to increased sales
volume, the effect of exchange rate variation on 33% of total costs, and
amortization of goodwill of the merged company. The following table shows each
component of the cost of products and services, and the change between periods:
By category
By category
Denominated
R$ US$ 09/30/02 09/30/01 /\%
-- --- -------- -------- ---
Personnel 389,575 - 389,575 330,528 17.9
Material 230,415 133,590 364,005 288,764 26.1
Oil and gas 238,509 42,090 280,599 234,871 19.5
Outsourced services 385,757 4,685 390,442 320,102 22.0
Energy 89,529 - 89,529 71,526 25.2
Acquisition of iron ore and pellets 10,321 641,185 651,506 627,296 3.9
Others 74,380 120,170 194,550 160,492 21.2
--------- ------- --------- --------- -----
1,418,486 941,720 2,360,206 2,033,579 16.1
Depreciation and depletion 418,765 - 418,765 337,336 24.1
Amortization of goodwill 73,257 - 73,257 12,324 494.4
--------- ------- --------- --------- -----
Total 1,910,508 941,720 2,852,228 2,383,239 19.7
========= ======= ========= ========= =====
67% 33% 100%
========= ======= ========
6 CVRD
1.3.3- Result of Shareholdings by Business Area
The results of shareholdings by business area are as follows:
Business Area 09/30/02 09/30/01
------------- -------- --------
Ferrous
.. Iron ore and pellets 1,474,291 270,513
.. Manganese and ferro-alloys 139,137 (8,732)
Non-ferrous (88,212) (186,769)
Logistics (286,205) (303,704)
Investments
.. Steel 181,907 244,631
.. Pulp and paper 7,258 24,274
.. Aluminum (382,726) (68,698)
.. Fertilizers 15,025 5,969
Others (19,769) 4
--------- -------
1,040,706 (22,512)
========= =======
The numbers reported per area do not necessarily reflect the individual results
of each company, but rather the amounts effectively applicable to the business
area.
Equity earnings increased from a loss of R$ 22,512 on 09/30/01 to a gain of R$
1,040,706 on 09/30/02, this variation was due to a combination of the following
factors:
Ferrous
(a) Iron ore and pellets
FERTECO - An increase in the equity result of R$ 189,352 (a gain of R$
92,395 on 09/30/2002 against a loss of R$ 96,957 on 09/30/2001) due to
increased sales volume and recording in 2001 of financial expenses and
exchange rate variation on loans indexed in dollars. The company was
acquired in April 2001. In 2002, R$ 69,312 was booked as amortization of
goodwill.
.. ITACO/RDE - An improved equity result of R$ 1,016,829 (a gain of R$
1,459,054 on 09/30/02 against a gain of R$ 442,225 on 09/30/01),
basically due to the devaluation of the real against the dollar (positive
exchange rate variation of R$ 1,077,932 on 09/30/02 versus positive
exchange rate variation of R$ 243,260 on 09/30/01). In operational terms,
iron ore sales rose 42.0% (63,791 thousand tons in 2002 against 44,926
thousand tons in 2001), including sales of its subsidiary CVRD Overseas.
.. KOBRASCO - A reduction in the equity result of R$ 23,954 (a loss of R$
69,276 on 09/30/02 versus a loss of R$ 45,322 on 09/30/01), due to the
increased negative effects of exchange rate variation on debt, a 3.9%
decrease in the average sale price (US$ 30.09 per ton on 09/30/02 against
US$ 31.32 per ton on 09/30/01) and a 12.8% drop in volume sold (2,718
thousand tons on 09/30/02 against 3,116 thousand tons on 09/30/01).
.. NIBRASCO - An improved equity result of R$ 11,656 (a gain of R$ 2,598 on
09/30/02 against a loss of R$ 9.058 on 09/30/01), due to booking in 2001
of R$ 21,000 as a provision for losses on the realization of ICMS (VAT)
credits. Additionally, sales volume dropped by 9.3% (5,099 thousand tons
on 09/30/2002 against 5,622 thousand tons on 09/30/2001) and the average
price fell 5.2% (US$ 28.69 per ton on 09/30/02 versus US$ 30.25 per ton
on 09/30/01).
.. SAMARCO - A reduction in the equity result of R$ 11,689 (a loss of R$
17,319 on 09/30/02 against a loss of R$ 5,630 on 09/30/01), due to
increased negative effects of exchange rate variation on debt. In
operational terms, sales volume increased 22.9% (10,608 thousand tons on
09/30/02 against 8,630 thousand tons on 09/30/01), offset by a 4.1% drop
in the average sales price (US$ 28.38 per ton on 09/30/02 against US$
29.58 per ton on 09/30/01).
CVRD 7
(b) Manganese and Ferro-alloys
.. RDME - An increase in the equity result of R$ 57,063 (a gain of R$ 80,808
on 09/30/02 versus a gain of R$ 23,745 on 09/30/01), due basically to the
fall in the exchange rate between the real and the euro in 2002.
.. SIBRA - A better equity result of R$ 83,704 (a gain of R$ 103,262 on
09/30/02 versus a gain of R$ 19,558 on 09/30/01), due to a 60.0% increase
in ferroalloy sales (112 thousand tons on 09/30/02 against 70 thousand
tons on 09/30/01), offset partly by a 13.3% decrease in the price of
ferroalloys (US$ 445.85 per ton on 09/30/02 against US$ 514.06 per ton on
09/30/01) as well as an 18.1% increase in the average manganese sales
price (US$ 54.68 per ton on 09/30/02 against US$ 46.28 per ton on
09/30/01), also partly offset by a 4.4% decrease in manganese sales
volume (818 thousand tons on 09/30/02 against 856 thousand tons on
09/30/01).
.. URUCUM - An improved equity result of R$ 7,091 (a gain of R$ 14,006 on
09/30/02 against a gain of R$ 6,915 on 09/30/01), due mainly to an
increase of 88.7% in manganese sales (251 thousand tons on 09/30/02
against 133 thousand tons on 09/30/01).
Non-ferrous
.. PARA PIGMENTOS - A provision for losses of R$ 87,936 was booked on
09/30/02 against R$ 103,725 on 09/30/01, due basically to the negative
effects of exchange rate variation on debt. In 2001, R$ 83,150 was
recorded as amortization of goodwill.
Logistics
.. DOCENAVE - An improved equity result of R$ 121,618 (a gain of R$ 107,014
on 09/30/02 against a loss of R$ 14,604 on 09/30/01), due to the
appreciation of the dollar against the real, offset partly by a 34.1%
drop in the average freight rate (US$ 4.80 per ton on 09/30/02 versus US$
7.28 per ton on 09/30/01).
.. DOCEPAR - R$ 50,735 basically refers to a provision for losses on assets
of doubtful realization.
.. FCA - R$ 131,115 was booked as a provision for losses on 09/30/02 against
R$ 107,965 on 09/30/01, due to the negative effects of exchange rate
variation of debt, along with R$ 86,172 of amortization of goodwill on
09/30/02 against R$ 138,559 on 09/30/01. CVRD's interest in FCA is held
through its subsidiary Tacuma.
.. MRS - R$ 65,543 was recorded as a provision for losses on 09/30/02, due
to the negative effects of exchange rate variation on debt, along with R$
16,881 of amortization of goodwill. Our participation on this investment
is held through Ferteco Mineracao S.A., Belem Administracoes e
Participacoes Ltda. and Caemi Mineracao e Metalurgia S.A..
Shareholdings
(a) Steel
.. CSI - An increase in the equity result of R$ 233,511 (a gain of R$
352,161 on 09/30/02 against a gain of R$ 118,650 on 09/30/01), caused by
a 10.5% increase in sales volume (R$ 1,520 thousand tons in 2002 against
1,376 thousand tons in 2001) and the appreciation of the dollar against
the real (positive exchange rate variation of R$ 303,682 on 09/30/02
versus a positive variation of R$ 132,019 on 09/30/01).
.. CSN - An equity result of R$ 107,522 was recorded on 09/30/01 due to
unwinding the cross shareholdings between CVRD and CSN carried out in
March 2001.
.. CST - A lower equity result of R$ 29,929 (a loss of R$ 42,907 on 09/30/02
against a loss of R$ 12,978 on 09/30/01), due to the increased negative
effects of exchange rate variation on indebtedness, offset in part by a
2.4% increase in the volume of slabs sold (3,547 thousand tons in 2002
against 3,464 thousand tons in 2001).
USIMINAS - A reduction in the equity result of R$ 110,172 (a loss of R$
107,453 on 09/30/02 versus a gain of R$ 2,719 on 09/30/01) caused mainly
by the negative effects of exchange rate variation on indebtedness.
(b) Aluminum
.. ALBRAS - A reduced equity result of R$ 126,958 (a loss of R$ 222,875 on
09/30/02 against a loss of R$ 95,917 on 09/30/01), due to increased
negative effects of exchange rate variation on the company's debt. In
operational terms, the average aluminum sales price dropped 10.5% (US$
1,313.92 per ton on 09/30/02 compared with US$ 1,468.08 per ton on
09/30/01) and sales volume rose by 15.3% (302 thousand tons on 09/30/02
against 262 thousand tons on 09/30/01).
8 CVRD
.. ALUNORTE - A reduced equity result of R$ 125,919 (a loss of R$ 213,782 on
09/30/02 against a loss of R$ 87,863 on 09/30/01), due to increased
negative effects of exchange rate variation on the company's debt.
Operationally, the average sales price of alumina dropped 13.8% (US$
165.51 per ton on 09/30/02 versus US$ 192.04 per ton on 09/30/01) while
sales volume remained stable (1,185 thousand tons on 09/30/02 versus
1,180 thousand tons on 09/30/01).
.. MRN - A reduction in the equity result of R$ 47,507 (a gain of R$ 10,256
on 09/30/02 against a gain of R$ 57,763 on 09/30/01), due to the negative
effects of exchange rate variation on debt, a 10.7% decrease in sales
volume (6,946 thousand tons on 09/30/02 compared with 7,777 thousand tons
on 09/30/01), and a 10.5% decrease in the sales price (US$ 18.75 per ton
on 09/30/02 against US$ 20.95 per ton on 09/30/01).
.. VALESUL - An increase in the equity result of R$ 2,718 (a gain of R$
22,443 on 09/30/02 against a gain of R$ 19,725 on 09/30/01), caused by a
5.0% rise in sales volume (63 thousand tons on 09/30/02 against 60
thousand tons on 09/30/01), while the average sales price dropped 12.4%
(US$ 1,679.61 per ton on 09/30/02 against US$ 1,916.59 per ton on
09/30/01).
.. ALUVALE - An increase in the equity result (own operations) of R$ 7,859
(a gain of R$ 25,442 on 09/30/02 against a gain of R$ 17,583 on 09/30/01)
basically due to financial result.
.. ITACO - A reduction in the equity result of R$ 24,221 (a loss of R$ 4,210
on 09/30/02 against a gain of R$ 20,011 on 09/30/01), due to increased
financial expenses. In operational terms, the average sales prices fell
for aluminum (10.5%), alumina (22.5%) and bauxite (17.8%), while sales
volume rose for all three: aluminum (19.8%), alumina (24.1%) and bauxite
(63.2%).
1.3.4- Operating Expenses
The operating expenses remained fairly stable (R$ 775,436 on 09/30/01 against R$
727,341 on 09/30/02), with the reduction in other expenses having been offset by
increases in:
o Selling expenses, due to an increase in commissions, in turn caused by
higher export sales;
o Administrative expenses, due to higher expenses for consulting; and
o Expenses for research and studies along with more copper prospecting.
1.3.5- Net Financial Result
The net financial result decreased R$ 2,421,670 (R$ 1,402,033 on 09/30/01
compared to R$ 3,823,703 on 09/30/02), mainly due to the increased effect of
exchange rate variation on the net Company debt (Note 6.19).
1.3.6- Discontinued Operations
The result in 2002 refers to gain on sale of assets of Florestas Rio Doce, and
in 2001 reflects gains on sale of the Company's holdings in Bahia Sul and
Cenibra, of R$ 230,384 and R$ 1,471,544 respectively.
1.3.7- Cash Flow
The operating cash flow measured by EBITDA (earnings before interest, income
tax, depreciation, amortization and depletion) was R$ 2,796,688 on 09/30/02,
reflecting an increase of 14.2% over 09/30/01, which was R$ 2,449,531 (other
information, item 7.4).
1.3.8- Income Tax and Social Contribution
Income tax and social contribution showed a credit of R$ 1,188,596 (credit of R$
585,034 on 09/30/01), mainly due to the tax write-off on losses from exchange
rate variation in the period for constitution of this tax/social contribution
benefit, based on the provisioning of interest on shareholders' equity of R$
349,753 on 09/30/02 (R$ 603,002 on 09/30/01) (Note 6.8).
CVRD 9
PART II
QUARTERLY INFORMATION AND NOTES TO THE QUARTERLY INFORMATION
(A free translation of the original in Portuguese
relating to the financial statements prepared in accordance with the
requirements of Brazilian Corporate Law)
2- BALANCE SHEET In thousands of reais
---------------------------------------------------------------------------------------------------------------------------------
Notes 09/ 30/ 02 06/ 30/ 02
----- ---------- ----------
Assets
Current asset s
Cash and cash equivalents 6.4 1,210,445 521,835
Accounts receivable from customers 6.5 1,398,483 989,739
Related parties 6.6 1,525,982 1,687,540
Inventories 6.7 382,511 401,925
Taxes recoverable - 124,014 111,465
Deferred income tax and social contribution 6.8 1,480,462 569,017
Others - 290,597 270,114
---------- ---------
6,412,494 4,551,635
---------- ---------
Long-term receivables
Related parties 6.6 1,831,490 1,711,249
Loans and financing - 282,674 296,237
Deferred income tax and social contribution 6.8 618,375 636,922
Judicial deposits 6.13 655,712 558,310
Others - 36,553 38,587
---------- ---------
3,424,804 3,241,305
---------- ---------
Permanent assets
Investments 6.9 9,599,470 8,904,602
Property, plant and equipment 6.10 8,397,623 8,126,748
---------- ---------
17,997,093 17,031,350
---------- ----------
27,834,391 24,824,290
========== ==========
Liabilities and stockholders' equity
Current liabilities
Short-term debt 6.11 1,066,196 1,668,905
Current portion of long-term debt 6.11 1,068,199 627,483
Payable to suppliers and contractors - 597,676 518,574
Related parties 6.6 1,100,963 720,089
Provision for interest on stockholders' equity 6.23 1,028,689 359,194
Payroll and related charges - 155,402 96,914
Pension Plan 6.15 68,809 64,533
Others - 112,616 111,138
---------- ----------
5,198,550 4,166,830
========== ==========
Long-term liabilit ies
Long-term debt 6.11 5,560,230 4,052,689
Related parties 6.6 3,698,208 2,690,581
Deferred income tax and social contribution 6.8 83,321 75,158
Provisions for contingencies 6.13 1,180,445 1,028,605
Pension Plan 6.15 455,758 429,493
Others - 418,036 255,419
---------- ----------
11,395,998 8,531,945
---------- ----------
Stockholders' equity
Paid-up capital 6.16 5,000,000 5,000,000
Revenue reserves - 6,239,843 7,125,515
---------- ----------
11,239,843 12,125,515
---------- ----------
27,834,391 24,824,290
========== ==========
The additional information, notes and attachment I are an integral part of these
statements.
10 CVRD
(A free translation of the original in Portuguese
relating to the financial statements prepared in accordance with the
requirements of Brazilian Corporate Law)
3- STATEMENT OF INCOME In thousands of reais
---------------------------------------------------------------------------------------------------------------------------------
From 07/01/02 From 01/01/02 From 07/01/01 From 01/01/01
Notes to 09/30/02 to 09/30/02 to 09/30/01 to 09/30/01
----- ----------- ----------- ----------- -----------
Operating revenues
Sales of ore and metals
Iron ore and pellets 1,873,012 4,516,196 1,423,677 3,588,856
Gold 63,465 232,030 102,643 232,470
Others 81,783 181,468 23,878 132,464
---------- ---------- ---------- ----------
2,018,260 4,929,694 1,550,198 3,953,790
Railroad and port services 312,507 814,575 255,790 796,433
Others 9,546 40,237 31,636 56,515
---------- ---------- ---------- ----------
2,340,313 5,784,506 1,837,624 4,806,738
Value Added taxes (80,856) (219,017) (59,766) (167,488)
---------- ---------- ---------- ----------
Net operating revenues 2,259,457 5,565,489 1,777,858 4,639,250
---------- ---------- ---------- ----------
Cost of products and services
Ore and metals (911,447) (2,537,913) (760,063) (2,047,126)
Railroad and port services (107,318) (286,487) (97,956) (298,561)
Others products and services (8,926) (27,828) (10,126) (37,552)
---------- ---------- ---------- ----------
(1,027,691) (2,852,228) (868,145) (2,383,239)
---------- ---------- ---------- ----------
Gross profit 1,231,766 2,713,261 909,713 2,256,011
Gross margin 54.5% 48.8% 51.2% 48.6%
Operating expenses
Selling (43,851) (107,277) (32,661) (85,505)
Administrative (91,166) (276,198) (88,998) (214,792)
Research and development (47,434) (99,501) (30,280) (71,349)
Other operating expenses 6.22 (130,183) (244,365) (244,479) (403,790)
---------- ---------- ---------- ----------
(312,634) (727,341) (396,418) (775,436)
---------- ---------- ---------- ----------
Operating profit before financial result and
result of investment participations 919,132 1,985,920 513,295 1,480,575
Result of investment participations 6.9
Gain on investments accounted for by the equity 962,235 1,871,936 (4,843) 558,519
method
Amortization of goodwill (108,822) (278,536) (294,731) (347,712)
Provision for losses (376,533) (558,661) (269,793) (244,339)
Others 5,239 5,967 614 11,020
---------- ---------- ---------- ----------
482,119 1,040,706 (568,753) (22,512)
Financial result, net 6.19
Financial expenses (income) (491,183) (727,971) (213,774) (414,363)
Monetary and exchange rate variation, net (2,121,674) (3,095,732) (472,410) (987,670)
---------- ---------- ---------- ----------
(2,612,857) (3,823,703) (686,184) (1,402,033)
---------- ---------- ---------- ----------
Operating profit (loss) (1,211,606) (797,077) (741,642) 56,030
Discontinued operations 110,693 110,693 1,471,544 1,770,516
---------- ---------- ---------- ----------
Income (loss) before income tax and social contribution (1,100,913) (686,384) 729,902 1,826,546
Income tax and social contribution 6.8 884,737 1,188,596 475,780 585,034
---------- ---------- ---------- ----------
Net income (loss) for the period (216,176) 502,212 1,205,682 2,411,580
========== ========== ========== ==========
Number of shares outstanding at the end of the period (in 383,839 383,839 384,309 384,309
thousands)
Net earnings (loss) per share outstanding at the end of the period (R$) (0.56) 1.31 3.15 6.28
The additional information, notes and attachment I are an integral part of
these statements.
CVRD 11
(A free translation of the original in Portuguese
relating to the financial statements prepared in accordance with the
requirements of Brazilian Corporate Law)
4- STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY In thousands of reais
-----------------------------------------------------------------------------------------------------------------------------------
Capital Revenue Retained
Notes Capital reserves reserves earnings Total
----- ------- -------- -------- -------- -----
On December 31, 2000 3,000,000 740,887 6,824,703 - 10,565,590
--------- ------- --------- --------- ----------
Treasury shares - - (57,528) - (57,528)
Capitalization of reserves 1,000,000 (300,629) (699,371) - -
Provision for pension plan liabilities - - - (22,160) (22,160)
Result on exchange of shares - 3,426 - - 3,426
Net income for the year - - - 3,050,710 3,050,710
Proposed appropriations:
Interest on stockholder's equity - - - (1,773,476) (1,773,476)
Appropriation to revenue reserves - - 1,255,074 (1,255,074) -
--------- ------- --------- --------- ----------
On December 31, 2001 4,000,000 443,684 7,322,878 - 11,766,562
--------- ------- --------- --------- ----------
Capitalization of reserves 6.16 1,000,000 (443,684) (556,316) - -
Realization of revenue reserves - - (526,477) 526,477 -
Treasury shares - - (242) - (242)
Net income for the period - - - 502,212 502,212
Provision for interest on stockholders' equity 6.23 - - - (1,028,689) (1,028,689)
--------- ------- --------- --------- ----------
On September 30, 2002 5,000,000 - 6,239,843 - 11,239,843
========= ======= ========== ========= ==========
The additional information, notes and attachment I are an integral part of
these statements.
12 CVRD
(A free translation of the original in Portuguese)
5- STATEMENT OF CASH FLOWS (ADDITIONAL INFORMATION)
--------------------------------------------------------------------------------
5- STATEMENT OF CASH FLOWS (ADDITIONAL INFORMATION)
09/30/02 09/30/01
-------- --------
Cash flows from operating activities:
Net income for the period 502,212 2,411,580
Adjustments to reconcile net income for the period
with cash provided by operating activities:
Result of investment participations (1,040,706) (22,512)
Depreciation, amortization and depletion 417,540 373,012
Deferred income tax and social contribution (1,192,561) (585,034)
Provision for contingencies 90,242 82,337
Discontinued operations (110,693) (1,770,516)
Finantial expenses and monetary and exchange rate variations on assets and 4,321,438 1,661,112
liabilities, net
Provision for losses - ICMS 17,298 126,864
Loss on disposal of property, plant and equipment 23,136 2,645
Dividends/interest on stockholders' equity received 98,065 251,518
Others 22,773 106,525
--------- ---------
3,148,744 2,637,531
--------- ---------
Decrease (increase) in assets:
Accounts receivable (515,205) 373,935
Inventories 61,994 (136,404)
Others (30,908) (29,983)
--------- ---------
(484,119) 207,548
--------- ---------
Increase in liabilities:
Suppliers and contractors 74,871 148,091
Payroll and related charges and others 37,190 27,064
Others 16,453 136,891
--------- ---------
128,514 312,046
--------- ---------
Net cash provided by operat ing act ivit ies 2,793,139 3,157,125
--------- ---------
Cash flows from investing activities:
Loans and advances receivable (549,654) (1,304,506)
Guarantees and deposits (138,337) (57,119)
Additions to investments (4,852) (1,432,923)
Additions to property, plant and equipment (1,039,157) (954,640)
Proceeds from disposal of property, plant and equipment and investments 3,947 988,142
--------- ---------
Net cash used in investing activities (1,728,053) (2,761,046)
--------- ---------
Cash flows from financing activities:
Short-term debt (250,883) 663,696
Long-term debt 908,180 397,808
Repayments:
Related parties (89,764) -
Financial institutions (289,794) (340,484)
Interest on stockholders' equity paid (777,484) (1,279,337)
Treasury shares (242) (33,642)
--------- ---------
Net cash used in f inancing act ivit ies (499,987) (591,959)
--------- ---------
Increase (decrease) in cash and cash equivalent s 565,099 (195,880)
Cash and cash equivalents, beginning of the period 645,346 1,569,185
Cash and cash equivalents, end of the period 1,210,445 1,373,305
========= =========
Cash paid during t he period f or:
Short-term interest (33,420) (47,903)
Long-term interest net of capitalization (191,221) (235,705)
Income tax and social contribution paid (3,967) (81,731)
Non-cash t ransact ions:
Change in treasury stocks - CVRD - 3,564
Conversion of loans into investments 165,174 520,589
Addition to property, plant and equipment with capitalization of interest 222,212 127,895
The additional information, notes and attachment I are an integral part of these
statements.
CVRD 13
6- NOTES TO THE QUARTERLY INFORMATION AT SEPTEMBER 30, 2002 AND 2001
Expressed in thousands of reais
6.1- Operations
Companhia Vale do Rio Doce - CVRD is a publicly traded corporation whose
predominant activities are mining, processing and sale of iron ore, pellets,
gold and potash, as well as port and railroad transportation services and power
generation. In addition, through its direct and indirect subsidiaries and
jointly controlled companies, CVRD operates in logistics, geological studies and
technological research services, steel and aluminum.
6.2- Presentation of Financial Statements
The quarterly information has been prepared according to the accounting
principles provided for in Brazilian corporate legislation as well as the rules
and guidelines issued by the Comissao de Valores Mobiliarios - CVM (Brazilian
Securities Commission) and IBRACON - Instituto dos Auditores Independentes do
Brasil (Brazilian Independent Auditors Institute).
In order to provide better information to the market, the Company is presenting
the Statement of Cash Flow. The disclosure of this statement is encouraged by
the CVM according to the Official Instruction 01/00 of 01/31/00.
Certain amounts and classifications in the 2001 quarterly information have been
adjusted to the criteria used on 09/30/02 for better comparability.
6.3- Significant Accounting Policies
(a) The Company adopts the accrual basis of accounting;
(b) Assets and liabilities that are realizable or due more than twelve months
after the quarterly information date are classified as long-term;
(c) Marketable securities, classified as cash and cash equivalents, are stated
at cost plus accrued income earned to the quarterly information date;
(d) Inventories are stated at average purchase or production cost, and imports
in transit at the cost of each item, not exceeding market or realizable
value;
(e) Assets and liabilities in foreign currencies are translated at exchange
rates in effect at the quarterly information date, and those in local
currency are restated based on contractual indices;
(f) Investments in subsidiaries, jointly controlled companies and affiliated
companies are accounted for by the equity method, based on the
stockholders' equity of the investees, and when applicable
increased/decreased by goodwill and negative goodwill to be amortized and
provision for losses. Other investments are recorded at cost, less
provision for unrealized losses when applicable;
(g) Property, plant and equipment, including interest incurred during the
construction period of large-scale projects, are recorded at historic cost
(increased by monetary restatement up to 1995) and depreciated by the
straight-line method, at rates that take into consideration the useful
lives of the assets. Depletion of mineral reserves is based on the ratio
between production and estimated capacity.
6.4- Cash and Cash Equivalents
09/30/02 06/30/02
-------- --------
Marketable securities related to 1,096,578 338,377
CDI (*)
Fixed-yield bond investments (funds) 23,135 96,084
Government securities (NBC-E, NTN-D, LFT) 89,904 84,509
Others 828 2,865
--------- -------
1,210,445 521,835
========= =======
(*) For part of these investments the Company contracted swap operations with
financial institutions related to interest rate and/or currency variations.
14 CVRD
6.5- Accounts Receivable from Customers
09/30/02 06/30/02
-------- --------
Domestic 478,975 388,086
Export 963,176 645,248
--------- ---------
1,442,151 1,033,334
Allowance for doubtful accounts (25,267) (23,355)
Allowance for ore weight credits (18,401) (20,240)
--------- ---------
1,398,483 989,739
========= =========
6.6- Transactions with Related Parties
Derived from sales and purchases of products and services or from loans under
normal market conditions, with maturities up to the year 2010, as follows:
Assets Liabilities
---------------------- ------------------------
09/30/02 06/30/02 09/30/02 06/30/02
-------- -------- -------- --------
Subsidiaries
Rio Doce International Finance Ltd. 956,022 1,336,399 1,911,563 1,443,180
Itabira Rio Doce Company Limited - ITACO 685,228 492,065 683,627 489,611
Mineracao Tacuma Ltda. (investment in Ferrovia Centro-Atlantica S.A.) 253,508 359,460 786 756
CVRD Overseas Ltd. 162,885 146,250 1,640,497 1,009,242
Docepar S.A. 136,082 129,794 138 132
SIBRA Eletrosiderurgica Brasileira S.A. 49,656 17,260 944 1,029
Mineracao Andira Ltda. (investment in Mineracao Serra do Sossego S.A.) 175,558 89,574 - 16
Brasilux S.A. 13,958 16,014 35,057 26,046
Vale do Rio Doce Aluminio S.A. - ALUVALE 418 22,449 27,772 49,915
Caulim do Brasil Investimentos S.A. 136,159 136,159 - -
Others 122,264 88,446 333,924 290,939
--------- --------- --------- ---------
2,691,738 2,833,870 4,634,308 3,310,866
--------- --------- --------- ---------
Jointly controlled companies
ALUNORTE - Alumina do Norte do Brasil S.A. 1,147,392 879,060 75,942 29,619
Ferrovia Centro-Atlantica S.A. 28,795 28,515 448 -
Salobo Metais S.A. 185,835 170,443 - -
Companhia Coreano-Brasileira de Pelotizacao - KOBRASCO 102,580 94,825 57,491 97,764
Companhia Hispano-Brasileira de Pelotizacao - HISPANOBRAS 54,065 40,860 77,342 59,116
Companhia Nipo-Brasileira de Pelotizacao - NIBRASCO 89,497 68,029 50,530 42,406
Companhia(Y)talo-Brasileira de Pelotizacao - ITABRASCO 47,816 38,884 69,416 43,551
Others 132,947 109,684 158,398 69,134
--------- --------- --------- ---------
1,788,927 1,430,300 489,567 341,590
--------- --------- --------- ---------
Affiliates 32,144 31,514 - -
--------- --------- --------- ---------
4,512,809 4,295,684 5,123,875 3,652,456
========= ========= ========= =========
Represented by:
Commercial balances (sales and purchases of products and services) (* ) 1,155,337 896,895 324,704 241,786
Short-term financial balances 1,525,982 1,687,540 1,100,963 720,089
Long-term financial balances 1,831,490 1,711,249 3,698,208 2,690,581
--------- --------- --------- ---------
4,512,809 4,295,684 5,123,875 3,652,456
========= ========= ========= =========
(*) Included in "Accounts receivable from customers" and "Payable to
suppliers and contractors."
CVRD 15
6.7- Inventories
09/30/02 06/30/02
-------- --------
Finished products
. Iron ore and pellets 115,381 99,282
. Gold 8,503 13,187
. Others 10,646 18,823
------- -------
134,530 131,292
Spare parts and maintenance supplies 247,981 270,633
------- -------
382,511 401,925
======= =======
6.8- Deferred Income Tax and Social Contribution
Income of the Company is subject to the normal tax system. The balances of
deferred assets and liabilities are presented as follows:
Deferred assets Deferred liabilities
--------------- --------------------
09/30/02 06/30/02 09/30/02 06/30/02
-------- -------- -------- --------
Tax loss carryforward 999,936 359,738 - -
Temporary differences:
. Pension Plan 179,062 164,462 - -
. Contingent liabilities 324,413 285,252 - -
. Provision for losses on assets 412,012 308,946 - -
. Provision for losses on derivative financial instruments 88,652 32,035 - -
. Others 94,762 55,506 - -
--------- --------- ------- ------
2,098,837 1,205,939 - -
Inflationary profit - - 4,613 4,253
Capital reserve - special monetary restatement - Law 8,200 - - 6,868 10,861
Accelerated depreciation - - 9,691 9,835
Contribution on Net Profit to collect - Samitri - - 1,032 -
Long-term sales - - 61,117 50,209
--------- --------- ------- ------
Total 2,098,837 1,205,939 83,321 75,158
========= ========= ======= ======
Short-term 1,480,462 569,017 - -
Long-term 618,375 636,922 83,321 75,158
--------- --------- ------- ------
2,098,837 1,205,939 83,321 75,158
========= ========= ======= ======
The realization of tax credits arising from temporary differences occurs at the
time of effective payment of the provisions made, in accordance with tax law.
In addition to the credits recorded, the Company has a lawsuit pending claiming
an additional 51.83% monetary restatement for tax purposes applied to the months
of January and February 1989 ("Plano Verao" monetary plan). A favorable ruling
has already been obtained for compensation of credits corresponding to 42.72%
instead of the 51.83% requested. The amount of these credits covered by the
ruling totals approximately R$ 405,000, and the accounting effects have not yet
been recognized in the quarterly information.
The current expectation is to realize substantially the deferred income tax
credit by the end of the year 2003.
16 CVRD
The amounts reported as income tax and social contribution which affected income
for the period are as follows:
09/30/02 09/30/01
-------- --------
Income before income tax and social contribution (686,384) 1,826,546
(-) Equity in results of subsidiaries and affiliated companies (1,871,936) (558,519)
(-) Result from discontinued operations (110,693) (1,540,132)
(+) Non deductible goodwill and provisions for losses 320,097 415,808
--------- ---------
(2,348,916) 143,703
Income tax and social contribution at combined tax rates 34% 34%
--------- ---------
Federal income tax and social contribution at statutory rates 798,631 (48,859)
Adjustments to net income which modify the effect on the result for the period:
. Income tax benefit from interest on stockholders' equity 349,753 603,002
. Fiscal incentives - 58,573
. Revision of prior period tax return 18,474 -
. Others 21,738 (27,682)
--------- ---------
Income tax and social contribution 1,188,596 585,034
========= =========
CVRD 17
6.9- Investments
Adjusted
Partici- Adjusted net income
pation stockholders' (loss) for
% equity the period
-----------------------------------
Subsidiaries
Florestas Rio Doce S.A. (c) 99.85 209,101 7,269
Itabira Internacional Servicos e Comercio Lda. (a, c, h) 99.99 1,058,434 299,353
Navegacao Vale do Rio Doce S.A. - DOCENAVE (c) 100.00 457,634 107,014
Rio Doce Europa - (a, c, h) S.'a.r.l 99.80 3,724,661 1,502,474
S.A. Mineracao da Trindade - SAMITRI (c, d) 100.00 - -
SIBRA Eletrosiderurgica Brasileira S.A. (c, d, e, m) 99.23 311,741 101,645
Vale do Rio Doce Aluminio S.A. - ALUVALE (c, f, j, m) 94.74 447,879 (378,654)
Ferteco Mineracao S.A. (c, m) 100.00 568,381 43,360
Urucum Mineracao S.A. (c) 100.00 70,302 26,167
Mineracao SOCOIMEX S.A. (c, d) 100.00 - -
TVV - Terminal de Vila Velha S.A. ( c ) 99.89 57,856 3,298
Others (c)
Jointly controlled companies
Companhia Coreano-Brasileira de Pelotizacao - KOBRASCO (b, c, m) 50.00 (124,990) (138,549)
Companhia Hispano-Brasileira de Pelotizacao - HISPANOBRAS (b, c, m) 50.89 93,568 16,760
Companhia(Y)talo-Brasileira de Pelotizacao - ITABRASCO (b, c, m) 50.90 78,454 20,685
Companhia Nipo-Brasileira de Pelotizacao - NIBRASCO (b, c, m) 51.00 88,040 5,094
Companhia Siderurgica de Tubarao - CST (b, c, d, e) 22.85 2,619,717 (187,777)
Companhia Siderurgica Nacional - CSN (c, j) - - -
Minas da Serra Geral S.A. - MSG (b, c) 51.00 62,171 11,160
Samarco Mineracao S.A. (b, m) 50.00 344,369 (34,640)
Others (b, c)
Affiliated companies
Fertilizantes Fosfatados S.A. - FOSFERTIL (c, e) 11.12 560,278 135,116
Usinas Siderurgicas de Minas Gerais S.A. - USIMINAS (c, d, e) 11.46 2,631,335 (937,635)
Result of investment
Investments participations
--------------------------- -------------------------
09/30/02 06/30/02 09/30/02 09/30/01
------------------------------------------------------
Subsidiaries
Florestas Rio Doce S.A. (c) 208,787 95,619 7,258 8,322
Itabira Internacional Servicos e Comercio Lda. (a, c, h) 1,058,328 990,762 343,510 384,704
Navegacao Vale do Rio Doce S.A. - DOCENAVE (c) 457,634 402,161 107,014 (14,604)
Rio Doce Europa - (a, c, h) S.'a.r.l 3,717,212 2,758,404 1,539,310 246,257
S.A. Mineracao da Trindade - SAMITRI (c, d) 731,184 751,495 - 518
SIBRA Eletrosiderurgica Brasileira S.A. (c, d, e, m) 554,424 527,949 103,262 19,558
Vale do Rio Doce Aluminio S.A. - ALUVALE (c, f, j, m) 424,321 711,992 (252,122) (84,043)
Ferteco Mineracao S.A. (c, m) 1,192,189 1,202,484 92,395 (96,957)
Urucum Mineracao S.A. (c) 70,302 65,091 26,167 12,114
Mineracao SOCOIMEX S.A. (c, d) 47,930 52,038 - -
TVV - Terminal de Vila Velha S.A. ( c ) 57,792 54,566 3,294 4,840
Others (c) 231,571 208,578 41,581 (11,246)
---------- ---------- ---------- ---------
8,751,674 7,821,139 2,011,669 469,463
---------- ---------- ---------- ---------
Jointly controlled companies
Companhia Coreano-Brasileira de Pelotizacao - KOBRASCO (b, c, m) - - (6,780) (25,604)
Companhia Hispano-Brasileira de Pelotizacao - HISPANOBRAS (b, c, m) 47,617 43,658 8,529 10,964
Companhia(Y)talo-Brasileira de Pelotizacao - ITABRASCO (b, c, m) 39,933 33,451 10,529 12,426
Companhia Nipo-Brasileira de Pelotizacao - NIBRASCO (b, c, m) 44,900 42,973 2,598 (9,058)
Companhia Siderurgica de Tubarao - CST (b, c, d, e) 449,909 471,761 (42,907) (12,978)
Companhia Siderurgica Nacional - CSN (c, j) - - - 107,522
Minas da Serra Geral S.A. - MSG (b, c) 31,707 29,549 5,691 6,331
Samarco Mineracao S.A. (b, m) 172,185 208,968 (17,319) -
Others (b, c) 46,756 53,044 (2,613) 639
---------- ---------- ---------- ---------
833,007 883,404 (42,272) 90,242
---------- ---------- ---------- ---------
Affiliated companies
Fertilizantes Fosfatados S.A. - FOSFERTIL (c, e) 62,303 57,670 15,025 5,969
Usinas Siderurgicas de Minas Gerais S.A. - USIMINAS (c, d, e) 301,551 383,451 (107,453) 2,719
Others - - (5,033) (9,874)
---------- ---------- ---------- ---------
363,854 441,121 (97,461) (1,186)
---------- ---------- ---------- ---------
Investments at cost 6,748 3,889 - -
---------- ---------- ---------- ---------
9,955,283 9,149,553 1,871,936 558,519
---------- ---------- ---------- ---------
Provision for losses
CELMAR S.A. - Industria de Celulose e Papel (c) (59,246) (59,246) - -
Companhia Coreano-Brasileira de Pelotizacao - KOBRASCO (b, c) (62,496) (16,346) (62,496) (19,718)
Companhia Ferroviaria do Nordeste (b, c) (31,727) (29,118) (7,002) (32,887)
DOCEPAR S.A. (c) (106,983) (100,451) (70,229) 19,956
Ferrovia Centro-Atlantica S.A. (c, g) - - (131,115) (107,965)
MRS Logistica S.A. (c, m) - - (65,543) -
ALBRAS - Aluminio Brasileiro S.A (c, m) - - (106,614) -
Para Pigmentos S.A. (c) (87,936) (35,104) (87,936) (103,725)
Sepetiba Tecon S.A. (c) - - (20,647) -
Others (7,425) (4,686) (7,079) -
---------- ---------- ---------- ---------
(355,813) (244,951) (558,661) (244,339)
---------- ---------- ---------- ---------
Amortization of goodwill - - (278,536) (347,712)
---------- ---------- ---------- ---------
Others - - 5,967 11,020
---------- ---------- ---------- ---------
Total 9,599,470 8,904,602 1,040,706 (22,512)
========== ========== ========== =========
(a) Equity in companies located abroad is converted into local currency at
rates in effect on the quarterly information date. The calculation of the
equity method adjustment comprises the difference due to exchange rate
variations, as well as participation in results;
(b) Notwithstanding the stockholdings, the classification as a jointly
controlled company considers the degree of control exercised by the
Company, which is shared with other partners;
(c) Companies whose quarterly information was not reviewed by independent
accountants;
18 CVRD
(d) Goodwill and negative goodwill on investments are as follows:
09/30/02 06/30/02
-------- --------
Goodwill
SIBRA Eletrosiderurgica Brasileira S.A. (included R$ 26,392 of goodwill on CPFL) 271,475 291,605
Caemi Mineracao e Metalurgia S.A. (indirectly through ITACO) 478,422 490,617
Ferteco Mineracao S.A. 623,808 658,464
S.A. Mineracao da Trindade - SAMITRI (merged on October 1, 2001) 731,184 751,495
Mineracao SOCOIMEX S.A. (merged on August 31, 2000) 47,930 52,038
ALUNORTE - Alumina do Norte do Brasil S.A. (c, m) 49,896 49,896
Salobo Metais Ltda. 88,472 -
Others 97,401 91,187
--------- ---------
2,388,588 2,385,302
========= =========
Negative goodwill
Companhia Siderurgica de Tubarao - CST (148,697) (148,697)
--------- ---------
(148,697) (148,697)
========= =========
Goodwill was amortized as follows:
09/30/02 06/30/02
-------- --------
Ferrovia Centro-Atlantica S.A. (c, g) (86,172) (138,559)
Ferteco Mineracao S.A. (c, d, m) (69,312) -
Gulf Industrial Investment Co. (h) - (60,061)
Para Pigmentos S.A. (c) - (83,150)
SIBRA Eletrosiderurgica Brasileira S.A. (includes R$ 2,400 on CPFL) (c, e) (60,388) (57,989)
MRS Logistica S.A. (indirectly through ITACO) (c, l) (16,881) -
Caemi Mineracao e Metalurgia S.A. (indirectly through ITACO) (c) (38,700) -
Others (a, c, h) (7,083) (7,953)
--------- ---------
(278,536) (347,712)
========= =========
(e) Investments in companies that were listed on stock exchanges on 09/30/02:
Book Value Market Value
---------- ------------
Companhia Siderurgica de Tubarao - CST 449,909 325,677
Fertilizantes Fosfatados S.A. - FOSFERTIL 62,303 114,150
Usinas Siderurgicas de Minas Gerais S.A. - USIMINAS 301,551 131,635
The market value of these investments does not necessarily reflect the value
that could be realized from selling a representative group of shares. The other
investments refer to companies that have no shares listed on stock exchanges;
(f) Indirect holdings through ALUVALE:
Partici- Adjusted Result of investment
pation stockholders' Investments participations
% equity 09/30/02 06/30/02 09/30/02 09/30/01
------------------------------------------------------------------------------------------------------------------------------------
ALBRAS - Aluminio Brasileiro S.A. (c, m) 51.00 (213,753) (106,614) 57,713 (113,861) (95,917)
ALUNORTE - Alumina do Norte do Brasil S.A. (c,m) 57.03 226,155 178,872 309,977 (213,782) (87,863)
Mineracao Rio do Norte S.A. (c, m) 40.00 498,041 199,217 225,054 10,256 57,763
Valesul Aluminio S.A. (c, m) 54.51 266,074 145,036 134,111 22,443 19,725
Mineracao Vera Cruz S.A. (c) 100.00 10,006 10,006 - - -
Own operations (2,196) (14,863) 42,822 22,249
------- ------- -------- -------
Provision for losses ALBRAS 424,321 711,992 (358,736) (84,043)
- - (106,614) -
------- ------- -------- -------
424,321 711,992 (358,736) (84,043)
======= ======= ======== =======
On 06/27/02, ALUVALE acquired the entire interest detained by its affiliated
company Mineracao Rio do Norte S.A. in ALUNORTE - Alumina do Norte do Brasil
S.A., equivalent to 12.62% of the total capital, for R$ 118,877; -
(g) The investment of CVRD in Ferrovia Centro-Atlantica S.A. is held through
its subsidiary Mineracao Tacuma S.A.;
CVRD 19
(h) Indirect holdings through Itabira Internacional Servicos e Comercio Lda.
and Rio Doce Europa - S.'a.r.l:
Partici- Adjusted Result of investment
pation stockholders' Investments participations
% equity 09/30/02 06/30/02 09/30/02 09/30/01
------------------------------------------------------------------------------------------------------------------------------------
Caemi Mineracao e Metalurgia S.A. (c, d) 16.86 835,187 619,235 640,281 19,513 -
California Steel Industries, Inc - CSI (a, c) 50.00 944,510 472,255 327,791 352,161 118,650
CVRD Overseas Ltd. (a, c) 100.00 444,819 444,819 298,666 153,712 86,320
Camelback Corporation (c) 100.00 115,971 115,971 115,971 - -
Gulf Industrial Investment Co. - GIIC (a, c) 50.00 110,730 55,365 96,455 11,559 10,642
Rio Doce Manganese Europe - RDME (a, c) 100.00 162,417 162,417 114,746 80,808 23,745
Vale do Rio Doce Aluminio S.A. - ALUVALE (c) 5.26 447,879 23,694 39,530 (19,780) (4,666)
Outras participacoes (a, c) 2,958 77,282 (16,285) 20,354
Itabira Rio Doce (ITACO) /Itabira Internacional (a, c) (838,386) 2,036,991 22,819 148,788
Rio Doce Europa - S.'a.r.l. (a,c) 3,717,212 1,453 1,278,313 227,128
--------- --------- --------- -------
4,775,540 3,749,166 1,882,820 630,961
Provision for losses - Sepetiba Tecon - - (20,647) -
Provision for losses - MRS (indirectly through CAEMI) - - (17,873) -
Amortization of goodwill - MRS (indirectly through CAEMI) - - (6,808) -
Amortization of goodwill - Caemi Mineracao e Metalurgia S.A - - (38,700) -
Amortization of goodwill - Gulf Industrial Investment Co. - - - (60,061)
--------- --------- --------- -------
4,775,540 3,749,166 1,798,792 570,900
========= ========= ========= =======
In July 2002, Itabira Rio Doce Company Limited - ITACO was sold to Itabira
International Servicos e Comercio Ltda.;
(i) The consolidated shareholding in Vale do Rio Doce Aluminio S.A. - ALUVALE
is 100%, the subsidiary Itabira Rio Doce Company Limited - ITACO owns 5.26%
of the capital;
(j) In March 2001, CVRD withdrew from CSN by unwinding the cross-holding
relationship between the companies;
(k) On 06/19/02, CVRD acquired from Anglo American Brasil Ltda. (Anglo), a
subsidiary of Anglo American plc, 44,172,369 common shares, corresponding
to 50% of the total capital of Salobo Metais S.A., for R$ 136,159. This
transaction was carried out through the intermediation of Caulim do Brasil
Investimentos S.A., a wholly owned CVRD subsidiary. With this acquisition,
CVRD became sole owner of Salobo;
(l) CVRD's holding in MRS Logistica is hold through Ferteco Mineracao S.A.,
Belem Administracao e Participacao Ltda., and Caemi Mineracao e Metalurgia
S.A.;
(m) Attachment I presents additional information about the companies in the
areas of aluminum, pellets, manganese and ferroalloys.
20 CVRD
6.10- Property, Plant and Equipment
09/30/02 06/30/02
-------------------------------------- ------------------------------------------
Accumulated Accumulated
Cost depreciation Net Cost depreciation Net
---- ------------ --- ---- ------------ ---
Ferrous - Northern System
Mining 1,675,190 (760,818) 914,372 1,576,633 (747,076) 829,557
Railroads 2,713,901 (1,053,157) 1,660,744 2,684,114 (1,025,490) 1,658,624
Ports 532,524 (241,749) 290,775 515,353 (242,306) 273,047
Construction in progress 447,703 - 447,703 504,480 - 504,480
---------- --------- ---------- ---------- --------- ----------
5,369,318 (2,055,724) 3,313,594 5,280,580 (2,014,872) 3,265,708
---------- --------- ---------- ---------- --------- ----------
Ferrous - Southern System
Mining 2,585,845 (1,547,204) 1,038,641 2,565,310 (1,518,964) 1,046,346
Railroads 3,157,675 (1,875,975) 1,281,700 3,091,414 (1,862,571) 1,228,843
Ports 561,634 (431,118) 130,516 561,448 (429,961) 131,487
Construction in progress 392,986 - 392,986 399,008 - 399,008
---------- --------- ---------- ---------- --------- ----------
6,698,140 (3,854,297) 2,843,843 6,617,180 (3,811,496) 2,805,684
---------- --------- ---------- ---------- --------- ----------
Pelletizing
Southern System 613,508 (443,022) 170,486 606,144 (438,587) 167,557
Northern System 482,622 (1,257) 481,365 - - -
Construction in progress 121,905 - 121,905 527,386 - 527,386
---------- --------- ---------- ---------- --------- ----------
1,218,035 (444,279) 773,756 1,133,530 (438,587) 694,943
---------- --------- ---------- ---------- --------- ----------
Non-ferrous
Potash 115,640 (43,407) 72,233 113,853 (40,586) 73,267
Gold 433,352 (292,849) 140,503 601,136 (439,139) 161,997
Research and projects 210,500 (174,712) 35,788 41,828 (21,354) 20,474
Construction in progress 67,707 - 67,707 58,729 - 58,729
---------- --------- ---------- ---------- --------- ----------
827,199 (510,968) 316,231 815,546 (501,079) 314,467
---------- --------- ---------- ---------- --------- ----------
Logistics 933,709 (532,666) 401,043 903,256 (528,085) 375,171
Construction in progress 83,809 - 83,809 115,788 - 115,788
---------- --------- ---------- ---------- --------- ----------
1,017,518 (532,666) 484,852 1,019,044 (528,085) 490,959
---------- --------- ---------- ---------- --------- ----------
Energy 204,216 (23,011) 181,205 204,187 (16,768) 187,419
Construction in progress 417,885 - 417,885 305,900 - 305,900
---------- --------- ---------- ---------- --------- ----------
622,101 (23,011) 599,090 510,087 (16,768) 493,319
---------- --------- ---------- ---------- --------- ----------
Corporate 94,712 (38,793) 55,919 90,264 (39,945) 50,319
Construction in progress 10,338 - 10,338 11,349 - 11,349
---------- --------- ---------- ---------- --------- ----------
105,050 (38,793) 66,257 101,613 (39,945) 61,668
---------- --------- ---------- ---------- --------- ----------
Total 15,857,361 (7,459,738) 8,397,623 15,477,580 (7,350,832) 8,126,748
========== ========= ========== ========== ========= ==========
By classification of asset:
09/30/02 06/30/02
--------------------------------------- ------------------------------------------
Accumulated Accumulated
Cost depreciation Net Cost depreciation Net
---- ------------ --- ---- ------------ ---
Land and buildings 1,526,070 (661,083) 864,987 1,475,967 (650,244) 825,723
Installations 4,780,137 (2,681,531) 2,098,606 4,192,712 (2,650,739) 1,541,973
Equipment 915,991 (550,844) 365,147 905,388 (543,787) 361,601
Railroads 5,324,526 (2,805,858) 2,518,668 5,226,065 (2,768,729) 2,457,336
Mineral rights 433,826 (173,548) 260,278 433,826 (169,853) 263,973
Others 1,334,478 (586,874) 747,604 1,320,981 (567,480) 753,501
---------- --------- ---------- ---------- --------- ----------
14,315,028 (7,459,738) 6,855,290 13,554,939 (7,350,832) 6,204,107
Construction in progress 1,542,333 - 1,542,333 1,922,641 - 1,922,641
---------- --------- ---------- ---------- --------- ----------
Total 15,857,361 (7,459,738) 8,397,623 15,477,580 (7,350,832) 8,126,748
========== ========= ========== ========== ========= ==========
The average annual depreciation rates are 3% for buildings, from 2% to 10% for
installations, from 10% to 20% for equipment, and from 1% to 4% for railroads.
Mineral reserve depletion is calculated annually as a function of the volume of
ore extracted in relation to the proven and probable reserves.
CVRD 21
Depreciation, amortization and depletion of property, plant and equipment have
been allocated to costs of production and services and to administrative
expenses as follows:
09/30/02 09/30/01
------- ------
Cost of production and services in the period 418,765 337,336
Inventories' variation (18,147) 21,374
------- ------
Cost of production and services 400,618 358,710
Administrative expenses 16,922 14,302
------ ------
417,540 373,012
======= =======
6.11- Loans and Financing
Short-term
Refers to export financing in the amount of R$ 1,066,196 on 09/30/02 and R$
1,668,905 on 06/30/02, with an average interest rate of 3.83% on 09/30/02.
Long-term
Current liabilities Long-term liabilities
------------------- ---------------------
09/30/02 06/30/02 09/30/02 06/30/02
-------- -------- -------- --------
Foreign operations
Loans and financing in:
U.S. dollars 913,413 500,622 3,011,894 2,162,742
Yen 34,656 25,747 111,979 83,950
Other currencies 1,017 746 1,526 1,286
Notes in U.S. dollars - - 1,947,450 1,422,200
Accrued charges 52,205 49,124 - -
--------- ------- --------- ---------
1,001,291 576,239 5,072,849 3,670,178
--------- ------- --------- ---------
Local operations
Indexed by TJLP, TR and IGP-M 11,858 10,758 58,514 58,282
Basket of currencies 45,140 33,450 71,473 61,326
Loans in U.S. dollars 2,968 2,167 348,450 255,010
Non-convertible debentures - - 8,944 7,893
Accrued charges 6,942 4,869 - -
--------- ------- --------- ---------
66,908 51,244 487,381 382,511
--------- ------- --------- ---------
1,068,199 627,483 5,560,230 4,052,689
========= ======= ========= =========
(a) Foreign currency loans and financing were converted into reais at exchange
rates effective on the quarterly information date, with US$ 1.00 = R$
3.8949 on 09/30/02 (R$ 2.8444 on 06/30/02) and(Y) 1.00 = R$ 0.032018 on
09/30/02 (R$ 0.023787 on 06/30/02);
(b) Of the total loans and financing, R$ 995,592 are guaranteed by the federal
government (with full counter-guarantees).
(c) Amortization of principal and finance charges incurred on long-term loans
and financing obtained abroad and domestically mature as follows as of
09/30/02:
2003 1,194,065
2004 2,372,290
2005 604,889
2006 743,177
2007 onward 645,809
---------
5,560,230
=========
22 CVRD
(d) Long-term foreign and domestic loans and financing were subject to annual
interest rates on 09/30/02 as follows:
Up to 3% 1,962,611
3.1 to 5% 2,027,765
5.1 to 7% 371,114
7.1 to 9% 128,795
9.1 to 11% 1,968,785
Over 11% 169,359
---------
6,628,429
=========
(e) The estimated market values of long-term loans and financing calculated to
present value based on available interest rates as of 09/30/02 are close to
their market values;
(f) Loans and financing, by currency/index in:
[GRAPHIC OMITTED]
Yen 2%
Basket of currencies 2%
Others 1%
Dollar 95%
R$ 7,694,625
6.12 - Securitization Program
On September 29, 2000, CVRD finalized the financial conditions for a US$ 300
million securitization program based on existing and future receivables
generated by its subsidiary CVRD Overseas Ltd.. This transaction, relating to
exports of iron ore and pellets to six of CVRD's major customers in Europe, the
United States and Asia, was structured by Bank of America Securities LLC, and is
divided into three tranches as follows:
Amount Grace Period Yield to Investor
Tranche (US $ million) Maturity (years) (per year)
------- -------------- -------- ------- ----------
1 25 10/15/2007 2 8.682%
2 (insured) 125 10/15/2007 2 Libor+0.65%
3 150 10/15/2010 3 8.926%
The balance of this operation on 09/30/02 totals R$ 1,184,046 (R$ 89,671 in
current liabilities and R$ 1,094,375 in long-term liabilities) and is included
in related party liabilities to the subsidiary CVRD Overseas Ltd. (Note 6.6).
CVRD 23
6.13 - Contingent Liabilities
At the quarterly information dates the contingent liabilities of the Company
were:
(a) Provisions for contingencies and respective judicial deposits, considered
by management and its legal counsel as sufficient to cover possible
losses from any type of lawsuit, were as follows:
Judicial deposits Provisions for contingencies
----------------- ----------------------------
09/30/02 06/30/02 09/30/02 06/30/02
-------- -------- -------- --------
Tax contingencies 401,283 322,700 511,182 382,726
Labor claims 137,643 123,637 350,427 363,518
Civil claims 112,242 105,856 299,931 264,813
Others 4,544 6,117 18,905 17,548
--------- --------- --------- ---------
Total 655,712 558,310 1,180,445 1,028,605
========= ========= ========= =========
The Company and its subsidiaries are parties to labor, civil, tax and other
suits have been contesting these matters both administratively and in the
courts. When necessary, these are backed by judicial deposits. Provisions for
eventual losses are estimated and restated monetarily by management upon the
advice of the legal department and outside counsel.
Tax contingencies relate principally to a suit claiming unconstitutionality of
the change in the calculation basis of PIS and COFINS social contributions
introduced by Law 9,718/98.
Labor-related actions principally comprise employee claims in connection with
disputes about the amount of indemnities paid upon dismissal.
Civil actions principally relate to claims made against the Company by
contractors in connection with losses alleged to have been incurred as a result
of various past government economic plans during which full indexation of
contracts for inflation was not permitted.
(b) Guarantees given to jointly controlled companies (normally in proportion to
the Company's percentage of participation) are as follows:
09/30/02 06/30/02
-------- --------
ALBRAS - Aluminio Brasileiro S.A. 1,371,814 1,015,684
Companhia Coreano-Brasileira de Pelotizacao - KOBRASCO 103,864 75,871
Ferrovia Centro-Atlantica S.A. 394,741 322,097
Sepetiba Tecon S.A. 89,695 68,931
Others - 3,270
--------- ---------
1,960,114 1,485,853
========= =========
The breakdown of guarantees by currency is:
09/30/02 06/30/02
-------- --------
U.S. Dollar 1,572,212 1,167,174
Real 387,902 318,679
--------- ---------
1,960,114 1,485,853
========= =========
(c) Upon privatization of the Company in 1997, The Brazilian government
stipulated the issuance of non-convertible debentures (Debentures) to the
then stockholders, including the federal government. The maturity dates of
these Debentures were established to guarantee that pre-privatization
stockholders, including the federal government, would share any future
benefits from mineral resources held by the Company and its subsidiary and
affiliated companies that were not evaluated at the time of setting the
minimum price of CVRD shares at the privatization auction.
A total of 388,559,056 Debentures were issued at a par value of R$ 0.01
(one centavo), whose value is to be restated in accordance with the
variation in the General Price Index (IGP-M), as set forth in the Issue
Deed.
On 10/04/02, the Comissao de Valores Mobiliarios - CVM (Brazilian
Securities Commission) approved the Company's registration request, filed
on 06/28/02, for Public Debentures Trading. As of 10/28/02, the Debentures
can be traded on the secondary market.
24 CVRD
The debenture holder are entitled to receive twice-yearly payments
equivalent to a percentage of the net revenue deriving from determined
mineral resources owned in May 1997 and included in the Issue Deed, as per
Tables I and II below.
The Debenture Issue Deed establishes that, in the event that the updated
and accrued premium the debenture holders are entitled to receive on the
respective payment dates falls below R$ 0.01 (one centavo) per Debenture,
such payment may be held in abeyance and accumulated until the next payment
date, or until some future period when the accrued value surpasses the
minimum determined above. In this case, the amount of the premium must be
accrued and increased by monthly interest equal to the Reference Rate of
SELIC (System for Settlement and Custody of Federal Securities), calculated
as of the determination dates until the month prior to effective payment,
and 1% per month during the month when the money is paid to the debenture
holders.
In view of the criteria and parameters for applicability of this premium,
and although gold sales from the Fazenda Brasileiro mine reached the
accumulated volume stipulated in the Deed of 26 metric tons in June 2002,
the amount of the premium was determined at approximately R$ 28.9 thousand,
i.e., less than R$ 0.01 (one centavo) per Debenture. Therefore, from the
issue date to present, no remuneration has been paid to the debenture
holders.
Based on the estimates for start-up of operations of the copper projects,
such premiums are forecast to begin in 2004. Considering iron ore sales,
the threshold established in the Deed should be reached in approximately
2030 for the Southern System and 2020 for the Northern System. Regarding
the remaining minerals, such as bauxite and nickel, estimates for start of
extraction are after 2005, and according to the criteria established in the
Deed, payment will be due on the net revenues starting in the fourth year
after the first mineral sales. The obligation to make these payments to the
debenture holders will terminate when the pertinent mineral resources are
depleted.
Criteria and Parameters for Composition and Applicability of the Premium:
Table I
----------------------------------------------------------------------------------------------------------------------------
Mineral Product Premium Applicability
----------------------------------------------------------------------------------------------------------------------------
Iron Ore 1.8% of Net Revenues Payment calculated on net revenue from sales occurring as of
the date the accrued sales volume since May 1997 reaches 1.7
billion tons in the Southern System, including Urucum, and
1.2 billion tons for the Northern System.
Gold, Copper and Byproducts 2.5% of Net Revenues Payment starting from the beginning of commercialization,
observing the following conditions and excepting the areas
of Carajas-Serra Leste and Salobo, among others:
(i) The Premium will be due considering the fractions
corresponding to the participation that the Company and/or
its subsidiaries companies detained in areas under joint
ventures on April 15, 1997 (e.g., Igarape-Bahia, Alemao,
Pojuca, Andorinhas, Liberdade and Sossego).
(ii) The Premium relative to Igarape-Bahia/Alemao will be
owed starting on the date accrued sales since May 1997
surpass 70 tons of gold.
(iii) The Premium relative to Fazenda Brasileiro will be
owed from the date accrued sales since May 1997 surpass 26
tons of gold.
Other Minerals 1% of Net Revenues Payment on net revenues from sales starting in the fourth
year after the date of first commercialization of the
minerals.
Table II
----------------------------------------------------------------------------------------------------------------------------
Other Criteria Premium
----------------------------------------------------------------------------------------------------------------------------
Sale of Mineral Rights 1% of the sale price of each mineral products.
Lease of Mineral Rights The Premium will be owed in full by the Company and/or its
subsidiaries companies, under the same terms applicable to
each product if the lease had not occurred.
Substitution of Mineral Rights The permutation of the mineral rights involving any of the
products included in Table I above shall be considered for
composing the Premium as originally set forth in the Deed.
CVRD 25
(d) The Company has commitments under a take-or-pay contract to acquire
approximately 207,060 tons of aluminum per year from ALBRAS at market
prices. This estimate is based on 51% of the predicted output of ALBRAS
at a market price of US$ 1,319.52 per ton on 09/30/02, representing an
annual commitment of R$ 731,934 based on the average rate for the
nine-month period ended September 30, 2002. The same applies to 676,236
tons of alumina per year produced by ALUNORTE, which at a market price of
US$ 168.55 per ton on 09/30/02 represents a yearly commitment of R$
305,342 at the same exchange rate mentioned. The effective take of ALBRAS
was R$ 515,028 and R$ 407,670 on 09/30/02 and 09/30/01, respectively, and
directly from ALUNORTE (net of the take assigned to ALBRAS), was R$
68,195 and R$ 49,501 on 09/30/02 and 09/30/01, respectively.
6.14 - Environmental and Site Reclamation and Restoration Costs
Expenditures relating to ongoing compliance with environmental regulations are
charged to production costs or capitalized as incurred. The Company manages its
environmental policies according to the specifications of ISO 14,001 and
maintains ongoing programs to minimize the environmental impact of its mining
operations as well as to reduce the costs that will be incurred upon termination
of activities at each mine. On 09/30/02, the provision for environmental
liabilities amounted to R$ 56,029 (R$ 59,651 on 06/30/02), which was accounted
in "Others" in long-term liabilities.
6.15 - Pension Plan - VALIA
The Fundacao Vale do Rio Doce de Seguridade Social - VALIA is a non-traded
non-profit supplementary social security entity, legally separate from CVRD,
founded in 1973 to provide supplementary social security benefits to the
employees of the Company, its subsidiaries, affiliated companies and others that
participate or may in the future participate in plans administered by the
Foundation.
The Company and various of its subsidiaries and affiliated companies are
sponsors of VALIA, in the following benefit plans:
(a) Benefit Plan
Defined Benefit Plan - "BD"
A pure defined benefit plan, now being phased out, instituted in 1973 upon
establishment of VALIA. This plan has been closed to new members and is
maintained only for existing retired participants and their beneficiaries
and a few residual active participants.
Mixed-Benefit Plan - "Vale Mais"
A mixed plan which offers programmable retirement income benefits of the
defined contribution type, independent of government Social Security. It
also includes a deferred severance benefit (vesting), as well as risk
benefits: retirement for disability, death benefits and sick-leave
assistance. This new plan has more modern, transparent and flexible rules
that make it more attractive for employees and more economical for the
sponsors.
"Vale Mais" was established in May 2000 and nearly 98.7% of the active
participants migrated to this new plan.
The contributions of the sponsors are as follows:
o Ordinary contribution - Destined to accrue the resources necessary to grant
income benefits, sponsor contributions are matched equally by participants,
up to 9% of their participation salaries, which may not exceed ten "plan
reference units" (this limit was R$1,383.86 in December 2001).
o Extraordinary contribution - This can be made at any time, at the
discretion of the sponsors.
o Normal contribution - To fund the risk plan and administrative expenses,
fixed by the actuary based on actuarial appraisals.
o Special contribution - Destined to cover any special commitment that may
arise.
During the period ended 09/30/02, the Company made contributions to VALIA in the
amount of R$ 40,392 (R$ 32,754 on 09/30/01) to fund the benefit plans it
sponsors.
(b) Reserve to be amortized
On 03/15/01, CVRD fully paid the total of reserve to be amortized to that date
by transferring the total shares of Companhia Siderurgica Nacional - CSN, in the
amount of R$ 521 million, and gave guarantees of minimum gains until VALIA sells
them. The guarantee consists of the variation of IGP-DI inflation index plus
interest of 6% per year.
26 CVRD
(c) Contractual guarantee
Due to the amount of income guaranteed was over the variation of the shares
on 09/30/02, CVRD registered a liability with VALIA in the amount of R$
139,272, accounted for as financial expense (Note 6.19), which can be
reversed by appreciation in the shares or dividends and interest on
shareholders' equity to be paid by CSN. (d) Actuarial liability
(d) Actuarial liability
This provision is the result of the Company's responsibility to provide
supplementary pensions relating to the early retirement programs of 1987
and 1989, in the amount of R$ 460,951, and an additional amount of R$
33,075 as required by CVM Deliberation 371. These liabilities were
calculated by an independent actuary for the year 2001 and represent the
current value of the benefits and pensions. Part is recorded in "Pension
Plan" account in current liabilities - R$ 68,809 (R$ 64,533 on 06/30/02)
and part in long-term liabilities - R$ 455,758 (R$ 429,493 on 06/30/02).
6.16 - Capital
The Company's capital is R$ 5 billion, corresponding to 388,559,056 book shares,
of which 249,983,143 are common shares, 138,575,913 are preferred class "A"
shares, the latter including one special preferred share ("Golden Share"), all
with no par value. On April 29, 2002, the Extraordinary Stockholders' General
Meeting approved a capital increase, without new share issue, through
capitalization of reserves in the amount of R$ 1 billion.
Preferred shares have the same rights as common shares, except for the right to
elect the members of the Board of Directors. They have priority to a minimum
annual dividend of 6% on the portion of capital represented by this class of
share.
The special "Golden Share" created during the privatization in 1997 belongs to
the Brazilian Government. This share gives it the right to a permanent veto of
changes in the Company's name, headquarters location, nature as a mining
enterprise, continuous operation of the integrated mining, transportation and
loading systems and other matters determined in the Bylaws.
On 09/30/02 the Company's capital is comprised as follows:
Number of shares
---------------------------------------------------------------------
Stockholders Commom % Preferred % Total %
---------------------------------------------------------------------
Valepar S.A. 105,443,070 42 - - 105,443,070 27
Brasilian Government (National Treasury / BNDES/
INSS / FPS) (a) - - 5,075,341 4 5,075,341 1
American Depositary Receipts - ADRs 53,706,307 22 62,156,360 45 115,862,667 30
Litel Participacoes S.A. (b) 25,272,641 10 - - 25,272,641 6
BNDESPar 8,973,671 4 1,251,980 1 10,225,651 3
Clube de Investimentos dos Empregados da
Vale - INVESTVALE 9,995,369 4 - - 9,995,369 3
Foreign - institutional investors 6,082,170 2 37,154,304 27 43,236,474 11
Brazil - institutional investors 28,664,802 11 16,828,735 12 45,493,537 12
Brazil - retail investors 7,129,943 3 16,104,459 11 23,234,402 6
Treasury stock 4,715,170 2 4,734 - 4,719,904 1
----------- --- ----------- --- ----------- ---
Total 249,983,143 100 138,575,913 100 388,559,056 100
=========== === =========== === =========== ===
(a) The National Bank for Economic and Social Development (BNDES), in its own
name and on behalf of the Brazilian Government, continuing the
privatization process started in 1997 as per the terms of the Privatization
Rules, on 03/21/02 sold 78,787,838 common CVRD shares to the public.
(b) Litel is the corporate vehicle pursuant to which Previ, Petros, Funcef and
Fundacao CESP, each of which is a Brazilian pension fund, hold common
shares in CVRD and Valepar.
As of 09/30/02, the number of holders of record who are residents of Brazil was
32,073. These stockholders owned 229,948,776 shares, representing 59.2% of the
capital stock.
6.17- American Depositary Receipts (ADR) Program
CVRD 27
On 06/20/00, the Company obtained ADR registration from the United States
Securities and Exchange Commission (SEC), beginning a process for its preferred
shares to be traded on the New York Stock Exchange (NYSE). On 03/21/02, in
connection with the sale of shares held by the BNDES and Brazilian Government,
the common shares began to be traded on the NYSE. Each ADR represents 1 (one)
preferred Class "A" or common share, traded under the code "RIOPR" and "Rio",
respectively.
6.18- Treasury Stock
The Board of Directors, under the terms of subparagraph XV of Article 13 of the
Bylaws and based on Article 30 of Law 6,404/76 and CVM Instructions 10 of
02/14/80 and 268 of 11/13/97, approved the acquisition by the Company of its own
shares to be held in treasury for later sale or cancellation.
On October 24, 2001, an Extraordinary General Meeting authorized the acquisition
of up to 19 million nominative book shares, with no par value, with 14 million
being common shares and 5 million preferred shares, in order to hold in treasury
for later sale or cancellation, without decreasing in capital stock. Up to
09/30/02, 4,715,170 common and 4,751 preferred shares had been acquired at a
cost of R$ 131,347, and held in treasury.
Shares
--------------------------------------------- Average
Class Quantity Unit acquisition cost quoted market price
----- -------- ----------------------------------------- ---------------------------------
09/30/02 06/30/02 Average Low High 09/30/02 06/30/02
-------- -------- ------- --- ---- -------- --------
Preferred 4,751 4,751 51.45 14.02 52.40 81.75 78.50
Common 4,715,170 4,715,170 27.80 20.07 52.09 85.69 73.08
--------- ---------
4,719,921 4,719,921
========= =========
6.19- Financial Result
09/30/02 09/30/01
-------- --------
Financial expenses (180,391) (192,920)
Foreign debt (60,971) (64,530)
Local debt (179,695) (6,662)
Related parties, net (*) (424,514) (224,974)
---------- ----------
Others (**) (845,571) (489,086)
---------- ----------
Monetary and exchange rate variation on liabilities (5,000,364) (2,071,465)
---------- ----------
Financial income
Marketable securities 62,841 43,167
Others 54,759 31,556
---------- ----------
117,600 74,723
Monetary and exchange rate variation on assets 1,904,632 1,083,795
--------- ---------
Financial income (expenses), net (3,823,703) (1,402,033)
========== ==========
(*) Includes expenses with VALIA (Note 6.15-b).
(**) Includes net losses on derivative financial instruments (Note 6.20).
6.20 - Financial Instruments - Derivatives
The main market risks the Company faces are related to interest rates, exchange
rates and commodities prices. CVRD has a policy of managing risks through the
use of derivatives instruments.
The Company's risk management follows policies and guidelines reviewed and
approved by the Board of Directors and Executive Board. These policies and
guidelines generally prohibit speculative trading and short selling and require
diversification of transactions and counterparts. The policy of the Company is
to settle all contracts financially without physical delivery of the products.
The overall position of the portfolio is assessed and monitored daily to measure
the financial results and the impact on cash flow. The credit limits and
28 CVRD
creditworthiness of counterparts are also reviewed periodically. The results of
hedging are reported to the Executive Board and recognized monthly in the CVRD
result.
Interest Rate Risk
Interest rate risk derives from floating-rate debt, mainly from trade finance
operations. The portion of floating-rate debt denominated in foreign currency is
mainly subject to fluctuations in the LIBOR (London Interbank Offered Rate). The
portion of floating-rate debt expressed in reais refers basically to the
Brazilian long-term interest rate (TJLP), established by the Brazilian Central
Bank. Since May 1998, CVRD has been using derivatives to limit its exposure to
fluctuations in the LIBOR.
The interest rate derivatives portfolio consists mainly of options trades aiming
to cap exposure to interest rate fluctuations, establishing upper and lower
limits. Some operations are subject to knock-out provisions which, if triggered,
eliminate the protection provided by the cap.
The table below provides information regarding the interest rate derivatives
portfolio for 09/30/02 and 09/30/01.
09/30/02 09/30/01
-------- --------
Notional Unrealized Notional Unrealized
value gain (loss) value gain (loss)
(in US $ (in R $ Final (in US $ (in R $
Type thousand) Rate range thousand) maturity thousand) Rate range thousand)
---- --------- ---------- --------- -------- --------- ---------- ---------
Cap 1,200 5.7 - 11.0% 1,737 May/07 1,375 5.7 - 11.0% 4,814
Floor 850 5.7 - 6.3% (80,656) May/05 1,000 5.7 - 6.3% (83,654)
Swap 475 5.8 - 6.7% (175,851) Oct/07 125 6.7% (31,470)
-------- -------
Total (254,770) (110,310)
======== ========
Exchange Rate Risk
Exchange rate risk comes from foreign currency debts. On the other hand, a
substantial part of the Company's revenues are denominated or indexed in U.S.
dollars, while the majority of costs are in reais. This provides a natural hedge
against possible devaluation of Brazilian currency. Events of this nature have
an immediate negative impact on foreign currency debt, offset by the positive
effect on future cash flows.
The Company adopts a strategy of monitoring market fluctuations and, if
necessary, carrying out derivatives operations to cover risks related to these
variations.
The portion of debt denominated in euros and Japanese yen is protected by
derivatives to cover risks of exchange rate movements of these currencies.
The table below shows the exchange rate derivatives portfolio for 09/30/02 and
09/30/01. These operations are forwards and range forwards which were structured
to ensure the purchase price of the following currencies:
09/30/02 09/30/01
-------- --------
Notional Unrealized Notional Unrealized
value gain (loss) value gain (loss)
(in US $ (in R $ Final (in US $ (in R $
Type thousand) Rate range thousand) maturity thousand) Rate range thousand)
---- --------- ---------- --------- -------- --------- ---------- ---------
Yen purchased 3,470 Y79 - 91 per US$ 3,963 May/05 31 Y94 - 110 per US$ (1,827)
Euros purchased E 1.18 - 1.23 per US$ 5,465 May/05 17 E1.10 - 1.24 per US$ (6,702)
Euros sold E 0.98 - 0.99 per US$ 134 Sep/02 - -
----- ------
Total 9,562 (8,529)
===== ======
Commodities Price Risk
The prices of iron ore, the Company's main product, are set in annual
negotiations between producers and consumers and are notably stable over time.
The Company does not enter into derivatives operations to hedge iron ore
exposure.
The Company uses hedge instruments to manage its exposure to changes in the
price of gold. These derivatives operations allow establishment of a minimum
profit level for future gold output. The Company actively manages its open
positions, with the results reported monthly to senior management to allow
adjustment of targets and strategies in response to market conditions.
The following table shows the gold derivatives portfolio of the Company on
09/30/02 and 09/30/01.
CVRD 29
09/30/02 09/30/01
-------- --------
Unrealized Unrealized
Price gain (loss) Price gain (loss)
Quantity range (in R $ Final Quantity range (in R $
Type (oz) US/$oz thousand) maturity (oz) US/$oz thousand)
---- ---- ------ --------- -------- ---- ------ ---------
Puts purchased 471,000 270 - 355 27,533 Dec/06 479,500 270 - 355 28,407
Calls sold 674,500 316 - 407 (43,192) Dec/06 845,500 308 - 379 (12,803)
Hybrids instruments 20,000 125 Nov/06 15,000 257
------- ------
Total (15,534) 15,861
======= ======
6.21 - Exchange Rate Exposure
The exchange rate exposure is predominantly in U.S. dollars.
In millions of reais
---------------------------------------------------------------
Subsidiaries and
Parent Company Affiliated Companies (*)
---------------------------------------------------------------
Assets 09/30/02 06/30/02 09/30/02 06/30/02
---------------------------------------------------------------
Current
Cash and banks and marketable securities 537 101 485 233
Others 2,596 2,373 1,191 887
------- ----- ----- -----
3,133 2,474 1,676 1,120
Long-term receivables 1,250 1,130 63 45
Investments 4,664 3,388 91 114
------- ----- ----- -----
Total 9,047 6,992 1,830 1,279
======= ===== ===== =====
Liabilities
Current
Short-term loans and financing 2,121 2,285 1,917 1,546
Others 1,079 437 469 406
------- ----- ----- -----
3,200 2,722 2,386 1,952
Long-term liabilities
Loans and financing 5,495 3,988 2,668 1,996
Others 3,263 2,393 871 643
------- ----- ----- -----
8,758 6,381 3,539 2,639
------- ----- ----- -----
Total 11,958 9,103 5,925 4,591
======= ===== ===== =====
Liabilities - R $(2,911) (2,111) (4,095) (3,312)
======= ===== ===== =====
Liabilities - US $(747) (742) (1,051) (1,165)
======= ===== ===== =====
(*) Proportional to the percentage of participation
6.22- Other Operating Expenses
09/30/02 09/30/01
-------- --------
Provisions for contingencies 90,242 82,337
Provision for loss on ICMS recoverable 17,298 126,864
Provision for profit sharing 58,000 46,000
Provision for early retirement program 29,833 20,128
Provision for loss Eletrobrs 28,515 -
Others 20,477 128,461
------- -------
244,365 403,790
======= =======
6.23- Subsequent Events
Proposal for Interest on Shareholders' Equity
30 CVRD
The Board of Directors has approved on this date the proposal of the Executive
Board of CVRD for payment on 12/10/02 of interest on shareholders' equity in the
amount of R$ 1,028,689, equivalent to R$ 2.68 per outstanding common or
preferred share.
CVRD 31
PART III
7- OTHER INFORMATION THE COMPANY DEEMS RELEVANT
7.1 Net Accumulated Income (in R$ Million)
1st Quarter 2nd Quarter 3rd Quarter 4th Quarter
2000 639 1101 1600 2135
2001 660 1206 2412 3051
2002 633 718 502 --
7.2- Factors Affecting Net Income in the Last 12 Months (in R$ Million)
[BAR CHART OBJECT OMITTED]
Net income at Net operating Cost of Result of Financial Operating Discontinued Income tax Net income at
09/30/01 revenue products investment result expenses net operations 09/30/02
and services participations
2,412 926 (445) 1,063 (2,402) 4 (1,660) 604 502
32 CVRD
7.3 - Business Perfomance Ratios
09/30/02 06/30/02
--------- ---------
Capital Ratios
1 - Capital assets to stockholders' equity (Permanent assets/Equity * 100) - (%) 160.12 140.46
2 - Capital assets to total liabilities (Permanent assets/Total liabilities * 100) - (%) 108.45 134.12
3 - Total liabilities to stockholders' equity (Total liabilities/Equity * 100) - (%) 147.64 104.73
4 - Short to total liabilities (Short-term liabilities/Total liabilities * 100) - (%) 31.33 32.81
5 - Stockholders' equity to total liabilities (Equity/Total liabilities *100) - (%) 67.73 95.49
6 - Capital assets to non-current funds (Permanent assets/(Equity + Long-term liabilities)) *100) - (%) 79.51 82.45
7 - Net Debt / Stockholders' equity (Net debt (a) / Equity) 0.71 0.48
8 - Net Debt (a) / Total Assets 0.28 0.24
9 - Leverage (Total Assets / Equity) 2.48 2.05
09/30/02 09/30/01
--------- ---------
Profitability and Other Ratios
1 - Gross Margin (Gross profit / Net operating revenues * 100) - (%) 48.75 48.63
2 - Operating Margin (Operating income / Net operating revenues * 100) - (%) (14.32) 0.84
3 - Net Margin (Net income / Net operating revenues * 100) - (%) 9.02 51.98
4 - Return on Assets (Net income (annualized) / Total assets *100) - ROA (%) 2.41 13.63
5 - Return on Equity (Net income (annualized) / Equity *100) - ROE (%) 5.96 28.78
6 - Total asset turnover (Net operating revenues (annualized) / Total assets) 0.27 0.26
7 - P/E (Price of preferred class A share / Earnings per share (annualized)) 46.98 6.31
8 - Price /Book Value (Price of preferred class A share / Book value per share) 2.79 1.82
9 - Net income per outstanding share (Net income (annualized) / Number of shares outstanding) 1.74 8.37
10 - NOPLAT / Operating Income (%) 38.95 39.08
11 - EBITDA + Dividends received / Financial expenses on financing 12.59 9.52
12- EBITDA + Dividends Received / Operating Income (%) 54.59 52.81
13- Net Debt (a) / EBITDA + Dividends Received(annualized) 1.96 1.19
14- FCOL / Financial expenses on financing 11.66 12.26
Note:
The income statement data has been annualized.
a) Net Debt = short- and long-term debt, net of related party loans, less cash
and cash equivalents; annualized with the income then ended.
7.4- Segment and Geographic Information
The Company's business areas are as follows:
Ferrous - mining of iron ore and manganese and production of pellets, as well as
their commercialization and respective rail transport and port handling (both
for the Northern and Southern Systems).
Non-ferrous - includes gold production, potash, geological prospecting and other
non-ferrous minerals.
Logistics - activities related to railroads and ports together with investments
in the area of maritime and rail transport and port services.
Investments - includes commercialization of aluminum products and investments in
joint ventures and affiliates involved in the production of bauxite, alumina
refining and aluminum smelting, as well as holdings in companies in the pulp and
paper sector and in steel making.
CVRD 33
Corporate center - comprises the functional areas of control, finance, legal
affairs, human resources, administration, information technology and investor
relations.
09/30/02
----------------------------------------------------------------------------
Holdings
-----------------------------------------
Non- Pulp
Ferrous ferrous Logistics and paper Aluminum Steel Others
------------ ---------- ---------- ---------- ------------ ------- ---------
Results
Sales classified by geographic destination
External market
Latin America 210,174 - - - - - -
United States 204,450 87,841 - - - - -
Europe 1,352,848 144,189 - - - - -
Middle East/Africa/Oceania 280,466 - - - - - -
Japan 456,788 - - - - - -
China 544,595 - - - - - -
Asia, other than Japan and China 313,035 - - - - - -
------------ ---------- ---------- ---------- -------------------------------
Operating revenues - external market 3,362,356 232,030 - - - - -
Operating revenues - internal market 1,551,208 181,906 457,006 - - - -
------------ ---------- ---------- ---------- ------------ -------- ---------
Total operating revenues 4,913,564 413,936 457,006 - - - -
Value-added taxes (184,354) (21,218) (13,445) - - - -
------------ ---------- ---------- --------- ------------- -------- ---------
Net operating revenues 4,729,210 392,718 443,561 - - - -
------------ ---------- ---------- --------- ------------- -------- ---------
Cost of products and services (2,436,857) (231,929) (183,442) - - - -
Selling and administrative expenses (107,277) - - - - - -
Research and development (14,458) (81,435) (3,412) - - - -
Other operating expenses, net (169,972) - - - - - -
------------ ---------- ---------- ---------- ------------ -------- --------
Operation profit before financial result and
result of investment participations 2,000,646 79,354 256,707 - - - -
Financial result, net - - - - - - -
Result of investments/participations 1,613,428 (88,212) (286,205) 7,258 (382,726) 181,907 15,025
Income taxes - - - - - - -
Discontinued operations - - - 110,693 - - -
------------ ---------- ---------- ---------- ------------ ------- ---------
Net income for the year 3,614,074 (8,858) (29,498) 117,951 (382,726) 181,907 15,025
============ ========== ========== ========== ============ ======= =========
EBITDA demonstration:
Operation profit before financial result and
result of investment participations 2,000,646 79,354 256,707 - - - -
Depreciation, amortization and depletion 423,596 60,998 17,174 - - - -
Dividend received - cash 57,179 - - - 33,664 20,404 8,860
Adjustments in non-cash itens:
- Provision for contingencies 90,242 - - - - - -
- Provision for loss on ICMS recoverable 17,298 - - - - - -
- Write-off of property, plant and equipment 11,700 - - - - - -
- Provision for early-retirement programs 29,833 - - - - - -
- Provision for losses 28 515 - - - - - -
- Others 4,084 - - - - - -
------------ ---------- ---------- --------- ------------ ------- ---------
EBITDA 2,663,093 140,352 273,881 - 33,664 20,404 8,860
EBITDA % of total 95.2% 5.0% 9.8% - 1.2% 0.7% 0.3%
EBITDA margin % 56.3% 35.7% 61.7% - - - -
============ ========== ========== ========= ============= ======= =========
09/30/02
--------------------------
Corporate
Center Total
------------ ------------
Results
Sales classified by geographic destination
External market
Latin America - 210,174
United States - 292,291
Europe - 1,497,037
Middle East/Africa/Oceania - 280,466
Japan - 456,788
China - 544,595
Asia, other than Japan and China - 313,035
------------ ------------
Operating revenues - external market - 3,594,386
Operating revenues - internal market - 2,190,120
------------ ------------
Total operating revenues - 5,784,506
Value-added taxes - (219,017)
------------ ------------
Net operating revenues - 5,565,489
------------ ------------
Cost of products and services - (2,852,228)
Selling and administrative expenses (276,198) (383,475)
Research and development (196) (99,501)
Other operating expenses, net (74,393) (244,365)
------------ ------------
Operation profit before financial result and
result of investment participations (350,787) 1,985,920)
Financial result, net (3,823,703) (3,823,703)
Result of investments/participations 19,789 1,040,706
Income taxes 1,188,596 1,188,596
Discontinued operations - 110,693
------------ ------------
Net income for the year (3,005,663) 502,212
============ ============
EBITDA demonstration:
Operation profit before financial result and
result of investment participations (350,787) 1,985,920
Depreciation, amortization and depletion 7,221 508,989
Dividend received - cash - 120,107
Adjustments in non-cash itens:
- Provision for contingencies - 90,242
- Provision for loss on ICMS recoverable - 17,298
- Write-off of property, plant and equipment - 11,700
- Provision for early-retirement programs - 29,833
- Provision for losses - 28,515
- Others - 4,084
------------ ------------
EBITDA (343,566) 2,796,688
EBITDA % of total (12.2%) 100.0%
EBITDA margin % - 50.3%
============ ============
Information related to period ended 09/30/01 is as follows:
09/30/01
----------------------------------------------------------------------------------
Ferrous Non-ferrous Logistics Holdings Corporate Center TOTAL
------------ ----------- ----------- -------------- ----------------------------
EBITDA 2,161,911 119,805 245,614 199,969 (277,768) 2,449,531
EBITDA % of total 88.3% 4.9% 10.0% 8.1% (11.3%) 100.0%
EBITDA margin % 55.8% 33.8% 60.2% - - 52.8%
34 CVRD
7.5- Share Performance on Stock Exchanges (Non-audited)
The following table shows the high and low closing sale prices for the Preferred
Class A Shares and Common Shares on the Sao Paulo Stock Exchange, and for
ADRs on the New York Stock Exchange (NYSE) (each ADR represents 1 preferred
class A or common share).
[LINE GRAPH OBJECT OMITTED]
In reais In US$
----------------------------------------------------- ----------------------------------------------------
Preferred Class A Shares Common Shares ADRs - Preferred Shares ADRs - Common Shares
-------------------------- --------------------------- ------------------------ ----------------------------
High Low High Low High Low High Low
-------------------------- ------------ ------------- ------------ ------------ --------------------------
2001
First Quarter 53.60 44.00 51.00 42.70 26.98 23.05 - -
Second Quarter 58.60 49.05 54.00 46.50 25.70 22.05 - -
Third Quarter 55.00 45.50 55.00 46.40 23.15 18.65 - -
Fourth Quarter 54.00 53.52 53.40 52.60 23.61 21.35 - -
2002
First Quarter 62.00 61.00 63.69 62.00 27.49 21.52 27.39 26.15
Second Quarter 75.90 59.80 78.10 61.50 29.51 23.50 30.00 25.68
Third Quarter 84.00 80.90 88.00 84.30 25.35 20.51 27.55 22.75
7. 6- Capital Expenditures (Non-audited)
In thousands of reais
----------------------------------
ACTUAL APPROVED
UP TO 09/02 FOR 2002 % ACTUAL
---------------- ---------------- --------------
Ongoing Capital Expenditures
Replacement/Refurbishment/Improvement 483,850 515,916 93.8
Geological Research 80,373 102,536 78.4
Technological Research/Development 35,180 37,750 93.2
Environment 1,323 1,293 102.3
lnformatics / Telecommunications 82,656 109,644 75.4
---------------- ---------------- --------------
683,382 767,139 89.1
---------------- ---------------- --------------
Equity Investments 610,521 649,755 94.0
Direct Investments 840,435 1,021,106 82.3
---------------- ---------------- --------------
Total Capital Expenditures 2,134,338 2,438,000 87.5
================ ================ ==============
CVRD 35
7.7- Operations for the period (Non-Audited)
(Million metric tons)
------------------------------------
09/30/02 09/30/01 VAR %
------------ ---------- ------------
PRODUCTION/PURCHASE
IRON ORE 93.9 93.8 0.1
PELLETS 11.9 11.8 0.8
POTASH 0.5 0.4 25.0
GOLD (thousand Kg) 8.6 11.7 (26.5)
RAILROAD OPERATIONS - GENERAL CARGO
EFVM 19.7 18.8 4.8
FCA 17.0 16.3 4.3
EFC 3.6 2.3 56.5
EFVM - TKU 8.5 8.3 2.4
FCA - TKU 7.2 6.4 12.5
EFC - TKU 2.3 1.4 64.3
PORT OPERATIONS
TUBARAO 13.6 13.2 3.0
SAO LUIZ 2.5 1.9 31.6
DOCENAVE OPERATIONS
BULK CARGO 3.8 14.8 (74.3)
GENERAL CARGO (TEUS) 51.4 45.3 13.5
MANOEVERS (REBOCADORES) 0.5 0.5 -
SALES FROM ALUMINUM AREA
BAUXITE 6,946 7,777 (10.7)
ALUMINA 1,185 1,179 0.5
ALUMINUM 365 329 10.9
7.8- Changes in Prices (Non-Audited)
The following table shows the prices for of products of the Company and its
subsidiary and jointly controlled companies for the periods indicated:
Asia Europe
Iron Ore Iron Ore
(SSF) (SFCJ) Gold Aluminum
(US$/ton) (US$/ton) (US$/ounce) (US$/ton)
----------- ----------- ------------- ------------
2001
March 15.35 18.68 257.70 1,569.59
June 16.32 18.68 269.50 1,536.30
September 16.32 18.68 293.10 1,405.96
December 16.32 18.68 277.70 1,362.36
2002
March 16.32 18.68 299.00 1,405.40
June 16.08 18.29 318.50 1,354.25
September 16.08 18.29 323.70 1,301.25
36 CVRD
7.9- Iron Ore and Pellet Sales (Main Markets) (Non-Audited)
(Millons of tons)
--------------------------------------------------------------------------
JAN to SEP JAN to SEP
----------- ------------
1998 % 1999 % 2000 % 2001 % 2001 % 2002 %
------- ---- ------ ---- ------ ----------------- ------ ---- ------ -----
FOREIGN MARKET
ASIA
CHINA 5.7 6 7.3 8 9.2 8 14.9 12 11.5 12 13.6 13
KOREA 7.1 7 7.9 8 7.0 6 6.0 5 4.7 5 5.2 5
PHILIPPINES 0.9 1 1.6 2 1.4 1 1.2 1 0.7 1 1.8 2
JAPAN 17.3 17 16.9 17 17.5 15 17.1 13 12.7 13 12.0 11
TAIWAN 1.6 2 1.8 2 1.6 2 2.2 2 1.6 2 1.3 1
OTHERS 1.1 1 0.6 - 0.4 - 1.1 1 0.5 1 - -
------- ---- ------ ---- ------ ----------------- ------ ---- ------ -----
33.7 34 36.1 37 37.1 32 42.5 34 31.7 34 33.9 32
------- ---- ------ ---- ------ ----------------- ------ ---- ------ -----
EUROPE
GERMANY 9.4 9 8.0 8 8.2 7 10.1 8 7.2 7 10.4 9
SPAIN 3.6 4 3.6 4 2.9 2 2.9 2 1.9 2 2.2 2
FRANCE 3.0 3 2.1 2 2.9 2 3.9 3 2.8 3 4.2 4
ITALY 6.1 6 5.0 5 4.8 4 5.1 4 3.7 4 4.0 4
UNITED KINGDOM 2.4 2 1.6 2 1.5 2 1.6 1 1.1 1 1.9 2
OTHERS 5.7 6 4.7 5 8.2 7 10.8 8 7.4 8 9.7 9
------- ---- ------ ---- ------ ----------------- ------ ---- ------ -----
30.2 30 25.0 26 28.5 24 34.4 26 24.1 25 32.4 30
------- ---- ------ ---- ------ ----------------- ------ ---- ------ -----
AMERICAS
ARGENTINA 2.3 2 1.6 2 1.4 1 1.9 1 1.4 1 1.6 1
UNITED STATES 3.1 3 3.0 3 3.5 3 2.9 2 2.3 2 3.1 3
OTHERS 2.2 2 1.8 2 2.0 2 1.5 1 1.3 1 1.5 1
------- ---- ------ ---- ------ ----------------- ------ ---- ------ -----
7.6 7 6.4 7 6.9 6 6.3 4 5.0 4 6.2 5
------- ---- ------ ---- ------ ----------------- ------ ---- ------ -----
AFRICA/MID.EAST/OCEANIA
BAHREIN 1.2 1 1.5 2 2.0 2 1.7 1 1.4 1 1.9 2
OTHERS 3.2 3 3.6 4 5.2 4 5.1 4 3.7 4 2.7 3
------- ---- ------ ---- ------ ----------------- ------ ---- ------ -----
4.4 4 5.1 6 7.2 6 6.8 5 5.1 5 4.6 5
------- ---- ------ ---- ------ ----------------- ------ ---- ------ -----
75.9 75 72.6 76 79.7 68 90.0 69 65.9 68 77.1 72
======= ==== ====== ==== ====== ================= ====== ==== ====== =====
DOMESTIC MARKET
STEEL MILLS 15.0 15 13.6 14 15.5 13 20.2 16 14.9 16 16.3 15
PELLETING AFFILIATES 8.6 10 10.1 10 21.6 19 19.7 15 15.3 16 13.6 13
------- ---- ------ ---- ------ ----------------- ------ ---- ------ -----
23.6 25 23.7 24 37.1 32 39.9 31 30.2 32 29.9 28
------- ---- ------ ---- ------ ----------------- ------ ---- ------ -----
TOTAL 99.5 100 96.3 100 116.8 100 129.9 100 96.1 100 107.0 100
======= ==== ====== ==== ====== ================= ====== ==== ====== =====
Exports by System
(Millons of tons)
-------------------------------------------------------------------------------------
JAN to SEP JAN to SEP
------------- --------------
1998 % 1999 % 2000 % 2001 % 2001 % 2002 %
------- ----- ------- -------------- ----- ------- ----- ------- ----- ------- ------
NORTHERN SYSTEM 44.0 44 42.8 44 46.6 40 50.8 39 37.3 39 38.7 36
SOUTHERN SYSTEM 55.5 56 53.5 56 70.2 60 79.1 61 58.8 61 68.3 64
------- ----- ------- -------------- ----- ------- ----- ------- ----- ------- ------
99.5 100 96.3 100 116.8 100 129.9 100 96.1 100 107.0 100
======= ===== ======= ============== ===== ======= ===== ======= ===== ======= ======
CVRD 37
7.10 - Shareholding Interests (Organizational Chart at 09/30/02)
Main Companies of the CVRD Group Holding in Total Stock (%)
COMPANHIA VALE DO RIO DOCE
Valepar 27.14%
Public 72.86%
------------------------------------------------------------------------
FERROUS
------------------------------------------------------------------------
IRON ORE AND PELLETS
------------------------------------------------------------------------
Ferteco
CVRD................................................ 100.00
Ferteco International*
Ferteco............................................. 100.00
Belem-Adm e Part. Ltda
CVRD................................................ 99.99
Docepar............................................. 0.01
Baovale Mineracao S.A.
CVRD................................................ 50.00
Shanghai Baosteel................................... 50.00
Minas de Serra Geral**
CVRD................................................ 51.00
Kawasaki............................................ 24.50
Japanese Group...................................... 24.50
CAEMI
Amazon (Itaco)...................................... 16.86
Mitsui.............................................. 43.37
Others ............................................. 39.77
Samarco Mineracao S/A
CVRD................................................ 50.00
BHP Brasil.......................................... 50.00
Hispanobras**
CVRD................................................ 50.89
Aceralia CS......................................... 49.11
Itabrasco**
CVRD................................................ 50.90
Liva................................................ 49.10
Nibrasco**
CVRD................................................ 51.00
Nippon Steel........................................ 25.39
Japanese Group...................................... 23.61
Kobrasco**
CVRD................................................ 50.00
POSCO............................................... 50.00
Kobin
Kobrasco............................................ 100.00
GIIC*
ITACO............................................... 50.00
Gulf Invest. Co..................................... 50.00
FERROUS
------------------------------------------------------------------------
MANGANESE AND ALLOYS
Urucum Mineracao S.A.
CVRD................................................. 100.00
RDME *
ITACO................................................ 100.00
SIBRA
CVRD................................................. 99.23
others............................................... 0.77
IFC.................................................. 5.62
CPFL
SIBRA................................................ 93.60
others .............................................. 6.40
Nova Era Silicon **
CVRD................................................. 49.00
Mitsubishi........................................... 22.50
Kawasaki............................................. 22.50
Mizushima............................................ 3.00
NON FERROUS
------------------------------------------------------------------------
PRECIOUS METALS, BASE METALS AND INDUSTRY MINERALS
------------------------------------------------------------------------
Docegeo
CVRD................................................. 99.998
Others............................................... 00.002
33 Mining Companies
CVRD................................................. 100.00
PPSA
CVRD................................................. 75.50
Mitsubishi........................................... 18.88
IFC.................................................. 5.62
PPSA Overseas*
PPSA................................................. 100.00
Salobo Metais
CVRD................................................. 50.00
CBI (CVRD)........................................... 50.00
Mineracaos Sossego
Min. Andira.......................................... 56.82
Camelback (Itaco).................................... 43.18
Compania Minera Andico-Brasilera Limitada - CMAB*
CVRD................................................. 99.90
Docepar.............................................. 0.10
LOGISTICS
RAILROADS AND PORTS
TVV-Terminal de Vila Velha S.A.
CVRD................................................99.887
Min. Tacuma.........................................0.005
Employees...........................................0.108
Ferrovia Centro Atlantica S.A.
Min. Tacuma.........................................45.65
VALIA...............................................9.99
KRJ.................................................12.31
CARMO...............................................9.99
CPP.................................................1.03
CSN.................................................11.95
Others..............................................9.08
Companhia Ferroviaria do Nordeste
CVRD................................................32.40
Taquari.............................................32.40
CSN.................................................32.40
Employees...........................................2.80
CSN Aceros S.A. *
ITACO ..............................................62.50
CSN Panama .........................................37.50
Sepetiba
CSN Aceros S.A. 80.00
CSN
Ferroban
Previ .............................................26.42
Funcef ............................................23.62
LAIF XV Ltda .......................................15.10
Gaborone ..........................................14.59
Brasil Ferrovais S.A. ..............................8.35
CVRD ...............................................3.75
others .............................................8.17
SHIPPING
Docenave
CVRD................................................100.00
Navedoce
Docenave............................................100.00
Seamar
Docenave............................................100.00
HOLDINGS
BAUXITE, ALUMINA AND ALUMINUM
Aluvale
CVRD................................................94.74
ITACO...............................................5.26
Min. Vera Cruz
Aluvale.............................................100.00
Albras**
Aluvale.............................................51.00
NAAC................................................49.00
Valesul**
Aluvale.............................................54.51
Billiton............................................45.49
Alunorte**
Aluvale.............................................57.03
Norsk Hydro.........................................34.03
NAAC................................................4.05
CBA.................................................3.62
JAIC................................................1.27
Min, Rio do Norte
Aluvale.............................................40.00
Billiton............................................14.80
Alcan...............................................12.00
CBA.................................................10.00
Alcoa...............................................8.58
Reynolds............................................5.00
Norsk Hydro.........................................5.00
Abalco..............................................4.62
FERTILIZERS
Fosfertil
CVRD................................................11.12
Fertifos............................................56.14
Others..............................................32.74
TIMBER, PULP & PAPER
Florestas Rio Doce
CVRD................................................99.85
Others..............................................0.15
Celmar
CVRD................................................54.07
Nissho Iwai.........................................45.93
Steel
CST
CVRD................................................22.85
Acesita/Unisor......................................37.29
Kawasaki............................................7.91
Others..............................................31.95
Califonia Steel *
Rio Doce Ltd........................................50.00
Kawasaki............................................50.00
Usiminas
CVRD.................................................11.46
Nipon Usiminas.......................................9.45
Previ................................................8.02
CIU .................................................4.95
Others...............................................66.12
Siderar(*)
Itabira Rio Doce.....................................4.85
Usiminas.............................................5.32
Sidertubes S/A.......................................50.21
ISA (Employees)......................................9.78
Others...............................................29.84
ENERGY
Consortium Igarapava Usina Hidrelectrica
CVRD................................................. 38.15
Cia Mineira Metais................................... 23.93
CSN.................................................. 17.92
CEMIG................................................ 14.50
Min. Morro Velho..................................... 5.50
Consortium Porto Estrela Usina Hidrelectrica
CVRD................................................. 33.33
CEMIG................................................ 33.33
Coteminas............................................ 33.33
Consortium Aimores Usina Hidrelectrica
CVRD................................................. 51.00
CEMIG................................................ 49.00
Consortium Candonga Usina Hidrelectrica
CVRD................................................. 50.00
EPP.................................................. 50.00
Consortium Funil Usina Hidrelectrica
CVRD................................................. 51.00
CEMIG................................................ 49.00
Consortium Capim Branco l e ll - Usina Hidrelectrica
CVRD................................................. 48.42
CEMIG................................................ 21.05
Suzano............................................... 17.90
Votorantim........................................... 12.63
Consortium Foz do Chapeco Usina Hidrelectrica
CVRD................................................. 40.00
Foz do Chapeco Energia S.A........................... 60.00
Consortium Santa Isabel Usina Hidrelectrica
CVRD................................................. 43.85
Billiton............................................. 20.60
Alcoa................................................ 20.00
Votorantim........................................... 10.00
C. Cirrea e Cimentos................................. 5.55
Consortium Estreito Energia
CVRD ................................................ 30.00
Tractebel ........................................... 30.00
Alcoa ............................................... 19.08
BHP Billiton ........................................ 16.48
C.Correa Energia .................................... 4.44
OTHERS ABROAD
Rio Doce International
CVRD................................................. 100.00
Alluvale ............................................ 0.01
Rio Doce Asia*
Rio Doce International............................... 100.00
Rio Doce Europa S.'a.r.l.*
CVRD................................................. 99.80
Others............................................... 0.20
Rio Doce International Finance*
Rio Doce Europa...................................... 100.00
Rio Doce Comercio International Aps*
CVRD................................................. 100.00
Itabira internacional Servicos e Comercio
RDCI ApS*............................................ 99.99
Others............................................... 0.01
Itabira Rio Doce Company Ltd. - ITACO*
Intabira Internat. Servicos e Comercio............... 100.00
Rio Doce America
ITACO................................................ 100.00
Rio Doce Ltd.
Rio Doce America..................................... 100.00
CVRD Overseas*
ITACO................................................ 100.00
CVRD Finance*
CVRD Overseas........................................ 99.00
BNP Paribas ......................................... 0.01
CVRD Europe Trading Energy B.V. - CETE*
CVRD................................................. 100.00
Brasilux
CVRD................................................. 100.00
Vale Overseas Ltd*
CVRD................................................. 100.00
38 CVRD
7.11- Information About FERTECO (Non-audited)
Statement of Income In thousands of reais
-------------------------------------------------------------------------------------------------
From From From
04/01/02 01/01/02 01/05/01
to 09/30/02 to 09/30/02 to 09/30/01
----------- ----------- -----------
Operating revenues 319,966 678,258 361,433
Value-added taxes (17,489) (53,639) (17,763)
--------- --------- --------
Net operating revenues 302,477 624,619 343,670
--------- --------- --------
Cost of products and services (186,549) (384,333) (188,512)
--------- --------- --------
Gross profit 115,928 240,286 155,158
Gain on investments accounted for by the equity method (20,327) (49,028) (5,712)
Operating income (expenses)
Selling and administrative (1,708) (26,310) (47,987)
Operating income (expenses) (13,375) (30,326) (154)
--------- --------- --------
(15,083) (56,636) (48,141)
Financial expenses (232,813) (284,727) (107,625)
Financial income 173,644 176,723 (212)
--------- --------- --------
Operating profit 21,349 26,618 (6,532)
Non operating income (expenses), net 194 99 (201)
--------- --------- --------
Income before income tax and social contribution 21,543 26,717 (6,733)
Income tax and social contribution 2,818 16,643 3,666
Net income for the period 24,361 43,360 (3,067)
========= ========= ========
Number of shares outstanding
at the end of the period (in thousands) 225,775 225,775 225,775
Net earnings per share outstanding ========= ========= ========
at the end of the period (R$) 0.11 0.19 (0.01)
========= ========= ========
CVRD acquired Ferteco in May 2001.
Investments
For 2002 Ferteco budgeted investments for maintenance of production capacity,
research, training and environmental control and recuperation.
CVRD 39
7.12- Information About RDIF (Non-audited)
Statement of Income In thousands of reais
------------------------------------------------------------------------------------------------------------------------------------
From From From From
04/01/ 02 01/01/ 02 04/01/01 01/01/01
to 09/30/02 to 09/30/02 to 09/30/01 to 09/30/01
----------- ----------- ----------- -----------
Net operating revenues 31,027 97,507 45,307 105,580
Cost of products and services - agencying costs (6,851) (21,999) (7,972) (19,268)
-------- -------- -------- --------
Gross profit 24,176 75,508 37,335 86,312
Gain on investments accounted for by the equity method 14,683 (21,394) 1,430,826 1,430,826
Operating income (expenses)
Selling (91) (447) - -
Other operating expenses, net 3,900 3,654 (81,361) (81,206)
-------- -------- -------- --------
3,809 3,207 (81,361) (81,206)
Financial expenses (8,303) (28,801) (91,527) (107,491)
Financial income (5,033) 47,103 13,097 34,892
Monetary and exchange rate variation, net 910 229 749 3,984
-------- -------- -------- --------
Operating profit 30,242 75,852 1,309,119 1,367,317
Non operating income (expenses), net (72,995) (72,995) - -
-------- -------- -------- --------
Net income (loss) for the period (42,753) 2,857 1,309,119 1,367,317
======== ======== ========== ===========
Number of shares outstanding at the end of the period (in thousands) 10 10 10 10
======== ======== ========== ===========
Net earnings per share outstanding at the end of the period (R)$ (4,275.30) 285.70 130,911.90 136,731.70
======== ======== ========== ===========
The company registered net income of R$ 2,857 in 2002 against R $1,367,317 in
2001, due to:
Result from Equity Investments
Refers to the gain on the sale of Celulose Nipo-Brasileira S. A. - CENIBRA in
2001, in the amount of R$ 1,471,544.
40 CVRD
PART IV
PART IV
8- EQUITY INVESTEE INFORMATION
8.1 - Aluminum Area - ALBRAS (Adjusted and Non-Audited) Attachment I
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Information 2002
------------------------------------------------------------------------------------------------------------------------------------
1st 2nd 3rd 4th
Quarter Quarter Quarter Quarter Total
------------------------------------------------------------------------------------------------------------------------------------
Quantity sold - external market MT (thousand) 84 108 101 - 293
Quantity sold - internal market MT (thousand) 4 2 3 - 9
----------------------------------------------------
Quantity sold - total MT (thousand) 88 110 104 - 302
====================================================
Average sales price - external market US$ 1,318.33 1,409.42 1,228.20 - 1,341.52
Average sales price - internal market US$ 1,352.12 1,330.47 1,335.69 - 1,341.83
Average sales price - total US$ 1,319.81 1,332.13 1,289.68 - 1,313.92
Long-term indebtedness, gross US$ 524,095 506,633 498,857 - 498,857
Short-term indebtedness, gross US$ 72,938 48,840 20,156 - 20,156
----------------------------------------------------
Total indebtedness, gross US$ 597,033 555,473 519,093 - 519,093
====================================================
Stockholders' equity R$ 299,202 113,162 (209,047) - (209,047)
====================================================
Net operating revenues R$ 273,853 366,494 414,264 - 1,054,611
Cost of products R$ (170,834) (223,590) (248,895) - (643,319)
Other expenses/revenues R$ (12,562) (9,587) (22,292) - (44,441)
Depreciation, amortization and depletion R$ 15,555 17,076 17,423 - 50,054
----------------------------------------------------
EBITDA R$ 106,012 150,393 160,500 - 416,905
Depreciation, amortization and depletion R$ (15,555) (17,076) (17,423) - (50,054)
----------------------------------------------------
EBIT R$ 90,457 133,317 143,077 - 366,851
Non-operating result R$ (746) (467) 82 - (1,131)
Net financial result R$ (11,141) (332,532) (505,233) - (848,906)
----------------------------------------------------
Income before income tax and social contribution R$ 78,570 (199,682) (362,074) - (483,186)
Income tax and social contribution R$ (2,627) 13,645 39,863 - 50,881
----------------------------------------------------
Net income R$ 75,943 186,037 (322,211) - (432,305)
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Information 2001
------------------------------------------------------------------------------------------------------------------------------------
1st 2nd 3rd 4th
Quarter Quarter Quarter Quarter Total
------------------------------------------------------------------------------------------------------------------------------------
Quantity sold - external market MT (thousand) 87 88 76 66 317
Quantity sold - internal market MT (thousand) 3 4 4 4 15
---------------------------------------------------------------
Quantity sold - total MT (thousand) 90 92 80 70 332
===============================================================
Average sales price - external market US$ 1,530.02 1,468.13 1,387.58 1,279.75 1,426.64
Average sales price - internal market US$ 1,606.92 1,528.21 1456.,51 1,330.54 1,477.68
Average sales price - total US$ 1,532.90 1,470.68 1,390.89 1,282.77 1,428.99
Long-term indebtedness, gross US$ 527,685 496,058 496,941 450,400 450,400
Short-term indebtedness, gross US$ 176,879 167,370 137,258 183,017 183,017
---------------------------------------------------------------
Total indebtedness, gross US$ 704,564 663,428 634,199 633,417 633,417
===============================================================
Stockholders' equity R$ 189,460 198,660 2,854 223,256 223,256
===============================================================
Net operating revenues R$ 277,094 307,826 278,080 231,638 1,094,638
Cost of products R$ (161,707) (176,460) (161,136) (147,148) (646,451)
Other expenses/revenues R$ (12,828) (9,735) (43,619) (12,542) (78,724)
Depreciation, amortization and depletion R$ 19,149 15,091 15,417 18,539 68,196
---------------------------------------------------------------
EBITDA R$ 121,708 136,722 88,742 90,487 437,659
Depreciation, amortization and depletion R$ (19,149) (15,091) (15,417) (18,539) (68,196)
---------------------------------------------------------------
EBIT R$ 102,559 121,631 73,325 71,948 369,463
Non-operating result R$ 582 (406) (1,157) 23,285 22,304
Net financial result R$ (119,075) (114,009) (251,524) 221,785 (262,823)
---------------------------------------------------------------
Income before income tax and social contribution R$ (15,934) 7,216 (179,356) 317,018 128,944
Income tax and social contribution R$ 14,467 1,982 (16,449) (96,706) (96,706)
---------------------------------------------------------------
Net income R$ 1,467 9,198 (195,805) 220,312 32,238
------------------------------------------------------------------------------------------------------------------------------------
CVRD 41
8.2 - Aluminum Area - ALUNORTE (Adjusted and Non-Audited) Attachment I
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Information 2002
------------------------------------------------------------------------------------------------------------------------------------
1st 2nd 3rd 4th
Quarter Quarter Quarter Quarter Total
------------------------------------------------------------------------------------------------------------------------------------
Quantity sold - external market MT (thousand) 222 175 115 - 512
Quantity sold - internal market MT (thousand) 205 235 233 - 673
----------------------------------------------------
Quantity sold - total MT (thousand) 427 410 348 - 1,185
====================================================
Average sales price - external market US$ 148.20 152.79 162.37 - 152.96
Average sales price - internal market US$ 175.94 175.38 173.97 - 175.05
Average sales price - total US$ 161.55 165.72 170.13 - 165.51
Long-term indebtedness, gross US$ 455,061 455,194 472,590 - 472,590
Short-term indebtedness, gross US$ - - - - -
----------------------------------------------------
Total indebtedness, gross US$ 455,061 455,194 472,590 - 472,590
====================================================
Stockholders' equity R$ 573,946 451,686 226,155 - 226,155
====================================================
Net operating revenues R$ 164,875 173,891 196,154 - 534,920
Cost of products R$ (135,765) (134,556) (131,291) - (401,612)
Other expenses/revenues R$ (7,377) (3,787) (4,079) - (15,243)
Depreciation, amortization and depletion R$ 12,802 13,351 12,853 - 39,006
----------------------------------------------------
EBITDA R$ 34,535 48,899 73,637 - 157,071
Depreciation, amortization and depletion R$ (12,802) (13,351) (12,853) - (39,006)
----------------------------------------------------
EBIT R$ 21,733 35,548 60,784 - 118,065
Non-operating result R$ (4) - - - (4)
Net financial result R$ (10,936) (198,404) (374,193) - (583,533)
----------------------------------------------------
Income before income tax and social contribution R$ 10,793 (162,856) (313,409) - (465,472)
Income tax and social contribution R$ (726) 20,677 6,396 - 26,347
----------------------------------------------------
Net income R$ 10,067 (142,179) (307,013) - (439,125)
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Information 2001
------------------------------------------------------------------------------------------------------------------------------------
1st 2nd 3rd 4th
Quarter Quarter Quarter Quarter Total
------------------------------------------------------------------------------------------------------------------------------------
Quantity sold - external market MT (thousand) 170 212 249 232 863
Quantity sold - internal market MT (thousand) 193 195 160 173 721
---------------------------------------------------------------
Quantity sold - total MT (thousand) 363 407 409 405 1,584
===============================================================
Average sales price - external market US$ 195.23 189.14 181.98 156.88 179.47
Average sales price - internal market US$ 202.01 195.80 188.73 181.10 192.36
Average sales price - total US$ 198.83 192.33 184.94 167.23 185.51
Long-term indebtedness, gross US$ 434,772 424,815 429,162 425,221 425,221
Short-term indebtedness, gross US$ 43,410 47,102 20,186 45,940 45,940
---------------------------------------------------------------
Total indebtedness, gross US$ 478,182 471,917 449,348 471,161 471,161
===============================================================
Stockholders' equity R$ 433,497 417,974 334,924 526,231 526,231
===============================================================
Net operating revenues R$ 149,709 188,075 177,200 171,700 686,684
Cost of products R$ (106,856) (128,775) (122,317) (139,731) (497,679)
Other expenses/revenues R$ (4,729) (6,886) (3,869) (7,857) (23,341)
Depreciation, amortization and depletion R$ 12,904 12,861 12,773 12,927 51,465
---------------------------------------------------------------
EBITDA R$ 51,028 65,275 63,787 37,039 217,129
Depreciation, amortization and depletion R$ (12,904) (12,861) (12,773) (12,927) (51,465)
---------------------------------------------------------------
EBIT R$ 38,124 52,414 51,014 24,112 165,664
Non-operating result R$ 749 (721) 104 31 163
Net financial result R$ (97,766) (75,812) (156,652) 126,209 (204,021)
---------------------------------------------------------------
Income before income tax and social contribution R$ (58,893) (24,119) (105,534) 150,352 (38,194)
Income tax and social contribution R$ 15,653 7,153 (22,808) (11,305) (11,307)
---------------------------------------------------------------
Net income R$ (43,240) (16,966) (128,342) 139,047 (49,501)
------------------------------------------------------------------------------------------------------------------------------------
42 CVRD
8.3 - Aluminum Area - ALUVALE (Adjusted and Non-Audited) Attachment I
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Information 2002
------------------------------------------------------------------------------------------------------------------------------------
1st 2nd 3rd 4th
Quarter Quarter Quarter Quarter Total
------------------------------------------------------------------------------------------------------------------------------------
Quantity sold - internal market MT (thousand) - - - - -
----------------------------------------------------
Quantity sold - total MT (thousand) - - - - -
====================================================
Average sales price - internal market US$ - - - - -
Average sales price - total US$ - - - - -
Short-term indebtedness, gross US$ - - - - -
----------------------------------------------------
Total indebtedness, gross US$ - - - - -
====================================================
Stockholders' equity R$ 891,456 751,522 447,879 - 447,879
====================================================
Net operating revenues R$ 288 616 354 - 1,258
Cost of products R$ (22) (47) (38) - (107)
Other expenses/revenues R$ 4,571 1,361 3,731 - 9,663
Depreciation, amortization and depletion R$ - 13 (13) - -
----------------------------------------------------
EBITDA R$ 4,837 1,943 4,034 - 10,814
Depreciation, amortization and depletion R$ - (13) 13 - -
----------------------------------------------------
EBIT R$ 4,837 1,930 4,047 - 10,814
Gain on investments accounted for by the equity method R$ 57,892 (145,352) (307,027) - (394,487)
Net financial result R$ 4,917 5,351 972 - 11,240
----------------------------------------------------
Income before income tax and social contribution R$ 67,646 (138,071) (302,008) - (372,433)
Income tax and social contribution R$ (2,723) (1,862) (1,635) - (6,220)
----------------------------------------------------
Net income R$ 64,923 (139,933) (303,643) - (378,653)
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Information 2001
------------------------------------------------------------------------------------------------------------------------------------
1st 2nd 3rd 4th
Quarter Quarter Quarter Quarter Total
------------------------------------------------------------------------------------------------------------------------------------
Quantity sold - internal market MT (thousand) - - 7 9 16
---------------------------------------------------------------
Quantity sold - total MT (thousand) - - 7 9 16
===============================================================
Average sales price - internal market US$ - - 1,966.10 1,748.02 1,843.43
Average sales price - total US$ - - 1,966.10 1,748.02 1,843.43
Short-term indebtedness, gross US$ 310 259 - - -
---------------------------------------------------------------
Total indebtedness, gross US$ 310 259 - - -
===============================================================
Stockholders' equity R$ 724,927 754,707 627,385 826,533 826,533
===============================================================
Net operating revenues R$ 323 438 599 507 1,867
Cost of products R$ - - (15) (34) (49)
Other expenses/revenues R$ 3,650 315 2,547 4,824 11,336
Depreciation, amortization and depletion R$ 8 9 9 9 35
---------------------------------------------------------------
EBITDA R$ 3,981 762 3,140 5,306 13,189
Depreciation, amortization and depletion R$ (8) (9) (9) (9) (35)
---------------------------------------------------------------
EBIT R$ 3,973 753 3,131 5,297 13,154
Gain on investments accounted for by the equity method R$ (2,165) 27,928 (132,056) 222,617 116,324
Net financial result R$ 3,155 3,916 4,293 4,557 15,921
---------------------------------------------------------------
Income before income tax and social contribution R$ 4,963 32,597 (124,632) 232,471 145,399
Income tax and social contribution R$ 3,870 (2,818) (2,689) 2,211 574
---------------------------------------------------------------
Net income R$ 8,833 29,779 (127,321) 234,682 145,973
------------------------------------------------------------------------------------------------------------------------------------
CVRD 43
8.4 - Aluminum Area - MRN (Adjusted and Non-Audited) Attachment I
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Information 2002
------------------------------------------------------------------------------------------------------------------------------------
1st 2nd 3rd 4th
Quarter Quarter Quarter Quarter Total
------------------------------------------------------------------------------------------------------------------------------------
Quantity sold - external market MT (thousand) 485 790 740 - 2,015
Quantity sold - internal market MT (thousand) 1,296 1,820 1,815 - 4,931
----------------------------------------------------
Quantity sold - total MT (thousand) 1,781 2,610 2,555 - 6,946
====================================================
Average sales price - external market US$ 20.56 19.09 19.21 - 19.49
Average sales price - internal market US$ 19.46 18.01 18.16 - 18.45
Average sales price - total US$ 19.80 16.31 18.46 - 18.75
Long-term indebtedness, gross US$ 95,892 90,312 77,786 - 77,786
Short-term indebtedness, gross US$ 14,436 18,780 23,198 - 23,198
----------------------------------------------------
Total indebtedness, gross US$ 110,328 109,092 100,984 - 100,984
====================================================
Stockholders' equity R$ 594,895 562,633 498,041 - 498,041
====================================================
Net operating revenues R$ 76,448 111,452 146,949 - 334,849
Cost of products R$ (39,697) (60,627) (72,806) - (173,130)
Other expenses/revenues R$ (569) (5,271) (1,589) - (7,429)
Depreciation, amortization and depletion R$ 9,840 13,325 14,617 - 37,782
----------------------------------------------------
EBITDA R$ 46,022 58,879 87,171 - 192,072
Depreciation, amortization and depletion R$ (9,840) (13,325) (14,617) - (37,782)
----------------------------------------------------
EBIT R$ 36,182 45,554 72,554 - 154,290
Gain on investments accounted for by the equity method R$ (3,403) (1,347) - - (4,750)
Non-operating result R$ (13) 11 12 - 10
Net financial result R$ (1,804) (32,286) (73,730) - (107,820)
----------------------------------------------------
Income before income tax and social contribution R$ 30,962 11,932 (1,164) - 41,730
Income tax and social contribution R$ (6,522) (4,139) (5,429) - (16,090)
----------------------------------------------------
Net income R$ 24,440 7,793 (6,593) - 25,640
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Information 2001
------------------------------------------------------------------------------------------------------------------------------------
1st 2nd 3rd 4th
Quarter Quarter Quarter Quarter Total
------------------------------------------------------------------------------------------------------------------------------------
Quantity sold - external market MT (thousand) 581 886 954 992 3,413
Quantity sold - internal market MT (thousand) 1,604 1,946 1,806 2,183 7,539
---------------------------------------------------------------
Quantity sold - total MT (thousand) 2,185 2,832 2,760 3,175 10,952
===============================================================
Average sales price - external market US$ 22.70 21.99 22.16 22.32 22.27
Average sales price - internal market US$ 20.08 20.16 20.37 21.00 20.36
Average sales price - total US$ 21.39 21.08 20.99 21.67 20.95
Long-term indebtedness, gross US$ 700 - 7,929 22,038 22,038
Short-term indebtedness, gross US$ 1,456 1,400 11,594 706 706
---------------------------------------------------------------
Total indebtedness, gross US$ 2,156 1,400 19,523 22,744 22,744
===============================================================
Stockholders' equity R$ 522,722 577,587 544,062 605,387 605,387
===============================================================
Net operating revenues R$ 86,629 124,021 139,255 154,020 503,925
Cost of products R$ (38,030) (58,247) (59,943) (65,360) (221,580)
Other expenses/revenues R$ (2,192) (2,172) (2,075) (2,204) (8,643)
Depreciation, amortization and depletion R$ 11,199 11,244 10,520 12,534 45,497
---------------------------------------------------------------
EBITDA R$ 57,606 74,846 87,757 98,990 319,199
Depreciation, amortization and depletion R$ (11,199) (11,244) (10,520) (12,534) (45,497)
---------------------------------------------------------------
EBIT R$ 46,407 63,602 77,237 86,456 273,702
Gain on investments accounted for by the equity method R$ (5,540) (2,050) (10,763) 16,868 (1,485)
Non-operating result R$ (79) 82 133 (18) 118
Net financial result R$ 225 (1,895) (2,541) (3,574) (7,785)
---------------------------------------------------------------
Income before income tax and social contribution R$ 41,013 59,739 64,066 99,732 264,550
Income tax and social contribution R$ (3,845) (4,875) (11,692) 237 (20,175)
---------------------------------------------------------------
Net income R$ 37,168 54,864 52,374 99,969 244,375
------------------------------------------------------------------------------------------------------------------------------------
44 CVRD
8.5 - Aluminum Area - VALESUL (Adjusted and Non-Audited) Attachment I
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Information 2002
------------------------------------------------------------------------------------------------------------------------------------
1st 2nd 3rd 4th
Quarter Quarter Quarter Quarter Total
-----------------------------------------------------------------------------------------------------------------------------------
Quantity sold - external market MT (thousand) 9 12 8 - 29
Quantity sold - internal market MT (thousand) 12 11 11 - 34
---------------------------------------------------
Quantity sold - total MT (thousand) 21 23 19 - 63
===================================================
Average sales price - external market US$ 1,467.44 1,481.49 1,485.09 - 1,478.28
Average sales price - internal market US$ 1,906.21 1,865.52 1,779.65 - 1,852.10
Average sales price - total US$ 1,720.97 1,663.20 1,654.96 - 1,679.61
Long-term indebtedness, gross US$ 1,868 1,416 953 - 953
Short-term indebtedness, gross US$ 685 555 409 - 409
---------------------------------------------------
Total indebtedness, gross US$ 2,553 1,971 1,362 - 1,362
===================================================
Stockholders' equity R$ 231,170 246,030 266,074 - 266,074
===================================================
Net operating revenues R$ 77,727 92,816 93,602 - 264,145
Cost of products R$ (63,576) (71,701) (61,711) - (196,988)
Other expenses/revenues R$ (3,223) (1,164) (7,075) - (11,462)
Depreciation, amortization and depletion R$ 3,332 3,600 2,826 - 9,758
---------------------------------------------------
EBITDA R$ 14,260 23,551 27,642 - 65,453
Depreciation, amortization and depletion R$ (3,332) (3,600) (2,826) - (9,758)
---------------------------------------------------
EBIT R$ 10,928 19,951 24,816 - 55,695
Non-operating result R$ 55 (54) 515 - 516
Net financial result R$ (597) 621 (945) - (921)
---------------------------------------------------
Income before income tax and social contribution R$ 10,386 20,518 24,386 - 55,290
Income tax and social contribution R$ (4,122) (5,652) (4,344) - (14,118)
---------------------------------------------------
Net income R$ 6,264 14,866 20,042 - 41,172
-----------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Information 2001
------------------------------------------------------------------------------------------------------------------------------------
1st 2nd 3rd 4th
Quarter Quarter Quarter Quarter Total
------------------------------------------------------------------------------------------------------------------------------------
Quantity sold - external market MT (thousand) 2 9 7 5 23
Quantity sold - internal market MT (thousand) 14 17 11 11 53
---------------------------------------------------------------
Quantity sold - total MT (thousand) 16 26 18 16 76
===============================================================
Average sales price - external market US$ 1,733.37 1,585.14 1,554.56 1,490.00 1,590.39
Average sales price - internal market US$ 2,155.46 2,047.69 1,934.35 1,887.58 2,054.36
Average sales price - total US$ 2,107.06 1,882.41 1,784.68 1,757.16 1,916.59
Long-term indebtedness, gross US$ 2,568 2,273 2,598 2,002 2,002
---------------------------------------------------------------
Short-term indebtedness, gross US$ 33,619 9,700 939 1,412 1,412
---------------------------------------------------------------
Total indebtedness, gross US$ 36,187 11,973 3,537 3,414 3,414
===============================================================
Stockholders' equity R$ 190,016 205,881 218,141 224,900 224,900
===============================================================
Net operating revenues R$ 59,652 98,954 77,239 66,811 302,656
Cost of products R$ (40,859) (68,267) (54,855) (49,928) (213,909)
Other expenses/revenues R$ (5,104) (11,433) 1,814 (5,956) (20,679)
Depreciation, amortization and depletion R$ 3,510 3,027 3,912 3,307 13,756
---------------------------------------------------------------
EBITDA R$ 17,199 22,281 28,110 14,234 81,824
Depreciation, amortization and depletion R$ (3,510) (3,027) (3,912) (3,307) (13,756)
---------------------------------------------------------------
EBIT R$ 13,689 19,254 24,198 10,927 68,068
Non-operating result R$ 49 (1,392) 13 (194) (1,524)
Net financial result R$ (3,079) 3,513 (8,500) (1,087) (9,153)
---------------------------------------------------------------
Income before income tax and social contribution R$ 10,659 21,375 15,711 9,646 57,391
Income tax and social contribution R$ (2,597) (5,510) (3,451) (2,887) (14,445)
---------------------------------------------------------------
Net income R$ 8,062 15,865 12,260 6,759 42,946
------------------------------------------------------------------------------------------------------------------------------------
CVRD 45
8.6 - Pelletizing Affiliates - HISPANOBRAS (Adjusted and Non-Audited) Attachment I
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Information 2002
------------------------------------------------------------------------------------------------------------------------------------
1st 2nd 3rd 4th
Quarter Quarter Quarter Quarter Total
-----------------------------------------------------------------------------------------------------------------------------------
Quantity sold - external market MT (thousand) 487 355 166 - 1,008
Quantity sold - internal market - CVRD MT (thousand) 420 480 520 - 1,420
----------------------------------------------------
Quantity sold - total MT (thousand) 907 835 686 - 2,428
====================================================
Average sales price - external market US$ 31.33 31.49 31.39 - 31.40
Average sales price - internal market US$ 31.43 31.63 32.28 - 31.81
Average sales price - total US$ 31.38 31.56 32.07 - 31.64
----------------------------------------------------
Stockholders' equity R$ 85,476 85,790 93,568 - 93,568
====================================================
Net operating revenues R$ 67,353 59,359 67,336 - 194,048
Cost of products R$ (57,628) (55,855) (56,920) - (170,403)
Other expenses/revenues R$ (737) (804) (128) - (1,669)
Depreciation, amortization and depletion R$ 2,458 2,458 2,322 - 7,238
----------------------------------------------------
EBITDA R$ 11,446 5,158 12,610 - 29,214
Depreciation, amortization and depletion R$ (2,458) (2,458) (2,322) - (7,238)
----------------------------------------------------
EBIT R$ 8,988 2,700 10,288 - 21,976
Non-operating result R$ (1,465) (4,923) (3,232) - (9,620)
Net financial result R$ 854 5,888 7,899 - 14,641
----------------------------------------------------
Income before income tax and social contribution R$ 8,377 3,665 14,955 - 26,997
Income tax and social contribution R$ (3,362) (1,480) (5,395) - (10,237)
----------------------------------------------------
Net income R$ 5,015 2,185 9,560 - 16,760
-----------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Information 2001
------------------------------------------------------------------------------------------------------------------------------------
1st 2nd 3rd 4th
Quarter Quarter Quarter Quarter Total
------------------------------------------------------------------------------------------------------------------------------------
Quantity sold - external market MT (thousand) 312 336 422 148 1,218
Quantity sold - internal market - CVRD MT (thousand) 520 560 460 850 2,390
---------------------------------------------------------------
Quantity sold - total MT (thousand) 832 896 882 998 3,608
===============================================================
Average sales price - external market US$ 30.80 30.79 32.84 31.46 31.44
Average sales price - internal market US$ 30.57 31.55 32.44 31.05 31.41
Average sales price - total US$ 30.65 31.26 32.64 31.12 31.42
---------------------------------------------------------------
Stockholders' equity R$ 73,036 76,910 85,853 80,461 80,461
===============================================================
Net operating revenues R$ 52,089 64,459 73,261 78,924 268,733
Cost of products R$ (44,565) (53,537) (60,310) (64,358) (222,770)
Other expenses/revenues R$ (502) (487) 1,274 (2,620) (2,335)
Depreciation, amortization and depletion R$ 2,377 2,378 2,376 2,437 9,568
---------------------------------------------------------------
EBITDA R$ 9,399 12,813 16,601 14,383 53,196
Depreciation, amortization and depletion R$ (2,377) (2,378) (2,376) (2,437) (9,568)
---------------------------------------------------------------
EBIT R$ 7,022 10,435 14,225 11,946 43,628
Non-operating result R$ (1,471) (2,537) (2,622) (3,135) (9,765)
Net financial result R$ 2,460 833 4,127 (5,038) 2,382
---------------------------------------------------------------
Income before income tax and social contribution R$ 8,011 8,731 15,730 3,773 36,245
Income tax and social contribution R$ (2,161) (3,419) (5,347) 62 (10,865)
---------------------------------------------------------------
Net income R$ 5,850 5,312 10,383 3,835 25,380
------------------------------------------------------------------------------------------------------------------------------------
46
8.7 - Pelletizing Affiliates - ITABRASCO (Adjusted and Non-Audited) Attachment I
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Information 2002
------------------------------------------------------------------------------------------------------------------------------------
1st 2nd 3rd 4th
Quarter Quarter Quarter Quarter Total
------------------------------------------------------------------------------------------------------------------------------------
Quantity sold - external market MT (thousand) 644 533 572 - 1,749
Quantity sold - internal market - CVRD MT (thousand) 233 169 243 - 645
----------------------------------------------------
Quantity sold - total MT (thousand) 877 702 815 - 2,394
====================================================
Average sales price - external market US$ 31.16 28.46 29.96 - 29.94
Average sales price - internal market US$ 31.90 27.79 30.33 - 30.23
Average sales price - total US$ 31.35 28.30 30.06 - 30.02
Short-term indebtedness, gross US$ 18,023 17,133 15,504 - 15,504
----------------------------------------------------
Total indebtedness, gross US$ 18,023 17,133 15,504 - 15,504
====================================================
Stockholders' equity R$ 60,230 65,720 78,454 - 78,454
====================================================
Net operating revenues R$ 65,575 49,920 79,980 - 195,475
Cost of products R$ (56,551) (47,528) (66,616) - (170,695)
Other expenses/revenues R$ (1,020) 105 (3,391) - (4,306)
Depreciation, amortization and depletion R$ 327 328 347 - 1,002
----------------------------------------------------
EBITDA R$ 8,331 2,825 10,320 - 21,476
Depreciation, amortization and depletion R$ (327) (328) (347) - (1,002)
----------------------------------------------------
EBIT R$ 8,004 2,497 9,973 - 20,474
Non-operating result R$ (2,494) (2,599) (2,581) - (7,674)
Net financial result R$ (637) 9,279 13,003 - 21,645
----------------------------------------------------
Income before income tax and social contribution R$ 4,873 9,177 20,395 - 34,445
Income tax and social contribution R$ (2,412) (3,687) (7,661) - (13,760)
----------------------------------------------------
Net income R$ 2,461 5,490 12,734 - 20,685
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Information 2001
------------------------------------------------------------------------------------------------------------------------------------
1st 2nd 3rd 4th
Quarter Quarter Quarter Quarter Total
------------------------------------------------------------------------------------------------------------------------------------
Quantity sold - external market MT (thousand) 497 579 471 700 2,247
Quantity sold - internal market MT (thousand) 278 196 271 295 1,040
---------------------------------------------------------------
Quantity sold - total MT (thousand) 775 775 742 995 3,287
===============================================================
Average sales price - external market US$ 31.13 31.96 31.80 31.67 31.63
Average sales price - internal market US$ 31.29 32.66 31.50 32.44 31.93
Average sales price - total US$ 31.19 31.62 31.69 31.90 31.72
Short-term indebtedness, gross US$ 503 - 407 522 522
---------------------------------------------------------------
Total indebtedness, gross US$ 503 - 407 552 522
===============================================================
Stockholders' equity R$ 46,768 65,160 68,571 58,164 58,164
===============================================================
Net operating revenues R$ 48,950 56,985 59,432 80,318 245,685
Cost of products R$ (45,783) (44,756) (52,288) (59,804) (202,631)
Other expenses/revenues R$ (1,086) (1,379) 2,177 (4,673) (4,961)
Depreciation, amortization and depletion R$ 288 309 338 363 1,298
---------------------------------------------------------------
EBITDA R$ 2,369 11,159 9,659 16,204 39,391
Depreciation, amortization and depletion R$ (288) (309) (338) (363) (1,298)
---------------------------------------------------------------
EBIT R$ 2,081 10,850 9,321 15,841 38,093
Non-operating result R$ (12) 6,437 15 (8,246) (1,806)
Net financial result R$ 2,770 1,808 2,369 (5,604) 1,343
---------------------------------------------------------------
Income before income tax and social contribution R$ 4,839 19,095 11,705 1,991 37,630
Income tax and social contribution R$ (3,288) (707) (7,231) 2,419 (8,807)
---------------------------------------------------------------
Net income R$ 1,551 18,388 4,474 4,410 28,823
------------------------------------------------------------------------------------------------------------------------------------
CVRD 47
8.8 - Pelletizing Affiliates - KOBRASCO (Adjusted and Non-Audited) Attachment I
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Information 2002
------------------------------------------------------------------------------------------------------------------------------------
1st 2nd 3rd 4th
Quarter Quarter Quarter Quarter Total
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Quantity sold - external market MT (thousand) 436 534 850 - 1,820
Quantity sold - internal market MT (thousand) 420 478 - - 898
----------------------------------------------------
Quantity sold - total MT (thousand) 856 1,012 850 - 2,718
====================================================
Average sales price - external market US$ 31.31 29.34 29.47 - 29.88
Average sales price - internal market US$ 32.08 29.24 - - 30.51
Average sales price - total US$ 31.69 29.30 29.47 - 30.09
Long-term indebtedness, gross US$ 149,583 143,378 147,150 - 147,150
= ---------------------------------------------------
Total indebtedness, gross US$ 149,583 143,378 147,150 - 147,150
====================================================
Stockholders' equity R$ 16,608 (32,692) (124,990) - (124,990)
====================================================
Net operating revenues R$ 63,984 72,449 74,427 - 210,860
Cost of products R$ (50,027) (67,075) (60,393) - (177,495)
Other expenses/revenues R$ (1,109) 1,471 (1,995) - (1,633)
Depreciation, amortization and depletion R$ 2,248 2,248 2,250 - 6,746
----------------------------------------------------
EBITDA R$ 15,096 9,093 14,289 - 38,478
Depreciation, amortization and depletion R$ (2,248) (2,248) (2,250) - (6,746)
----------------------------------------------------
EBIT R$ 12,848 6,845 12,039 - 31,732
Other expenses - non cash R$ (2,984) (3,617) (5,453) - (12,054)
Gain on investments accounted for by the equity method R$ 57 939 1,766 - 2,762
Non-operating result R$ 31 27 24 - 82
Net financial result R$ (3,811) (78,006) (147,117) - (228,934)
----------------------------------------------------
Income before income tax and social contribution R$ 6,141 (73,812) (138,741) - (206,412)
Income tax and social contribution R$ (3,093) 24,511 46,445 - 67,863
----------------------------------------------------
Net income R$ 3,048 (49,301) (92,296) - (138,549)
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Information 2001
------------------------------------------------------------------------------------------------------------------------------------
1st 2nd 3rd 4th
Quarter Quarter Quarter Quarter Total
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Quantity sold - external market MT (thousand) 561 523 493 558 2,135
Quantity sold - internal market - CVRD MT (thousand) 420 489 630 510 2,049
---------------------------------------------------------------
Quantity sold - total MT (thousand) 981 1,012 1,123 1,068 4,184
===============================================================
Average sales price - external market US$ 30.04 31.38 33.26 30.80 30.56
Average sales price - internal market US$ 31.80 31.29 30 31.64 31.32
Average sales price - total US$ 30.79 31.34 31.19 31.20 30.93
Long-term indebtedness, gross US$ 128,282 128,006 128,915 128,797 128,797
---------------------------------------------------------------
Total indebtedness, gross US$ 128,282 128,006 128,915 128,797 128,797
===============================================================
Stockholders' equity R$ 39,224 32,574 (39,435) 13,560 13,560
===============================================================
Net operating revenues R$ 61,210 70,414 90,720 84,647 306,991
Cost of products R$ (46,868) (56,123) (68,213) (66,792) (237,996)
Other expenses/revenues R$ (734) (755) (781) (695) (2,965)
Depreciation, amortization and depletion R$ 2,225 2,226 2,221 2,260 8,932
---------------------------------------------------------------
EBITDA R$ 15,833 15,762 23,947 19,420 74,962
Depreciation, amortization and depletion R$ (2,225) (2,226) (2,221) (2,260) (8,932)
---------------------------------------------------------------
EBIT R$ 13,608 13,536 21,726 17,160 66,030
Other expenses - non cash R$ - - (52,000) 14,086 (37,914)
Gain on investments accounted for by the equity method R$ 316 229 (545) 618 618
Non-operating result R$ 12 (46) 126 (39) 53
Net financial result R$ (32,118) (23,780) (51,598) 41,253 (66,243)
---------------------------------------------------------------
Income before income tax and social contribution R$ (18,182) (10,061) (82,291) 73,078 (37,456)
Income tax and social contribution R$ 6,198 3,411 10,281 (20,072) (182)
---------------------------------------------------------------
Net income R$ (11,984) (6,650) (72,010) 53,006 (37,638)
------------------------------------------------------------------------------------------------------------------------------------
48
8.9 - Pelletizing Affiliates - NIBRASCO (Adjusted and Non-Audited) Attachment I
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Information 2002
------------------------------------------------------------------------------------------------------------------------------------
1st 2nd 3rd 4th
Quarter Quarter Quarter Quarter Total
------------------------------------------------------------------------------------------------------------------------------------
Quantity sold - external market MT (thousand) 407 686 290 - 1,383
Quantity sold - internal market - CVRD MT (thousand) 584 1,544 1,520 - 3,648
Quantity sold - internal market - Others MT (thousand) 9 27 32 - 68
----------------------------------------------------
Quantity sold - total MT (thousand) 1,000 2,257 1,842 - 5,099
====================================================
Average sales price - external market US$ 30.25 30.88 27.39 - 29.96
Average sales price - internal market US$ 30.49 31.58 25.69 - 28.95
Average sales price - total US$ 30.39 31.36 25.96 - 28.69
Long-term indebtedness, gross US$ 3,600 2,400 2,400 - 2,400
Short-term indebtedness, gross US$ 2,484 2,400 2,436 - 2,436
Total indebtedness, gross US$ 6,084 4,800 4,836 - 4,836
----------------------------------------------------
Stockholders' equity R$ 78,682 84,259 88,040 - 88,040
====================================================
Net operating revenues R$ 70,936 163,815 162,232 - 396,983
Cost of products R$ (70,397) (144,430) (148,056) - (362,883)
Other expenses/revenues R$ 144 2,006 686 - 2,836
Depreciation, amortization and depletion R$ 4,217 4,218 4,218 - 12,653
----------------------------------------------------
EBITDA R$ 4,900 25,609 19,080 - 49,589
Depreciation, amortization and depletion R$ (4,217) (4,218) (4,218) - (12,653)
----------------------------------------------------
EBIT R$ 683 21,391 14,862 - 36,936
Other expenses - non cash R$ (2,548) (7,041) (4,887) - (14,476)
Net financial result R$ (2,463) (4,034) (2,136) - (8,633)
----------------------------------------------------
Income before income tax and social contribution R$ (4,328) 17,357 7,839 - 13,827
Income tax and social contribution R$ 66 (4,737) (4,062) - (8,733)
----------------------------------------------------
Net income R$ (4,262) 12,620 3,777 - 5,094
------------------------------------------------------------------------------------------------------------------------------------
Information 2001
------------------------------------------------------------------------------------------------------------------------------------
1st 2nd 3rd 4th
Quarter Quarter Quarter Quarter Total
------------------------------------------------------------------------------------------------------------------------------------
Quantity sold - external market MT (thousand) 806 559 514 432 2,311
Quantity sold - internal market - CVRD MT (thousand) 1,169 1,572 929 871 4,541
Quantity sold - internal market - Others MT (thousand) 35 38 - 68 141
---------------------------------------------------------------
Quantity sold - total MT (thousand) 2,010 2,169 1,443 1,371 6,993
===============================================================
Average sales price - external market US$ 30.16 30.00 30.48 30.10 30.20
Average sales price - internal market US$ 30 31 29 27 29.70
Average sales price - total US$ 30.31 31.00 29.22 27.90 29.80
Long-term indebtedness, gross US$ 6,000 4,800 4,800 3,600 3,600
Short-term indebtedness, gross US$ 2,619 2,400 2,505 2,400 2,400
---------------------------------------------------------------
Total indebtedness, gross US$ 8,619 7,200 7,305 6,000 6,000
===============================================================
Stockholders' equity R$ 122,313 113,062 79,058 82,945 82,945
===============================================================
Net operating revenues R$ 122,876 151,327 109,356 98,864 482,423
Cost of products R$ 107,077) (125,975) (102,174) (87,913) (423,139)
Other expenses/revenues R$ (10,534) (8,049) 12,922 1,747 (3,914)
Depreciation, amortization and depletion R$ 4,086 4,086 4,128 4,130 16,430
---------------------------------------------------------------
EBITDA R$ 9,351 21,389 24,232 16,828 71,800
Depreciation, amortization and depletion R$ (4,086) (4,086) (4,128) (4,130) (16,430)
---------------------------------------------------------------
EBIT R$ 5,265 17,303 20,104 12,698 55,370
Other expenses - non cash R$ - - (42,000) (2,960) (44,960)
Net financial result R$ 902 679 (8,420) (41) (6,880)
---------------------------------------------------------------
Income before income tax and social contribution R$ 6,167 17,982 (30,316) 9,697 3,530
Income tax and social contribution R$ (3,172) (4,734) (3,688) (2,851) (14,445)
---------------------------------------------------------------
Net income R$ 2,995 13,248 (34,004) 6,846 (10,915)
------------------------------------------------------------------------------------------------------------------------------------
CVRD 49
8.10 - Pelletizing Affiliates - SAMARCO (Adjusted and Non-Audited) Attachment I
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Information 2002
------------------------------------------------------------------------------------------------------------------------------------
1st 2nd 3rd 4th
Quarter Quarter Quarter Quarter Total
------------------------------------------------------------------------------------------------------------------------------------
Quantity sold - total MT (thousand) 3,301 3,436 3,871 - 10,608
====================================================
Average sales price - total US$ 28.48 28.78 27.93 - 28.38
Long-term indebtedness, gross US$ 92,788 86,584 76,181 - 76,181
Short-term indebtedness, gross US$ 169,170 180,539 169,538 - 169,538
----------------------------------------------------
Total indebtedness, gross US$ 261,958 267,123 245,719 - 245,719
====================================================
Stockholders' equity R$ 510,038 417,935 344,369 - 344,369
====================================================
Net operating revenues R$ 212,909 239,124 310,720 - 762,753
Cost of products R$ (108,837) (114,932) (138,102) - 361,871)
Other expenses/revenues R$ (18,632) (19,474) (26,619) - (64,725)
Depreciation, amortization and depletion R$ 7,745 9,358 9,195 - 26,298
----------------------------------------------------
EBITDA R$ 93,185 114,076 155,194 - 362,455
Depreciation, amortization and depletion R$ (7,745) (9,358) (9,195) - (26,298)
----------------------------------------------------
EBIT R$ 85,440 104,718 145,999 - 336,157
Other expenses/revenues - non cash R$ (1,815) (9,221) (18,473) - (29,509)
Gain on investments accounted for by the equity method R$ 2,213 (11,509) (42,680) - (51,976)
Non-operating result R$ 50 (35) 485 - 500
Net financial result R$ (15,237) (95,886) (162,374) - (273,497)
----------------------------------------------------
Income before income tax and social contribution R$ 70,651 (11,933) (77,043) - (18,325)
Income tax and social contribution R$ (12,555) (7,431) 3,671 - (16,315)
----------------------------------------------------
Net income R$ 58,096 (19,364) (73,372) - (34,640)
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Information 2001
------------------------------------------------------------------------------------------------------------------------------------
1st 2nd 3rd 4th
Quarter Quarter Quarter Quarter Total
------------------------------------------------------------------------------------------------------------------------------------
Quantity sold - total MT (thousand) 3,399 2,919 2,312 2,571 11,201
===============================================================
Average sales price - total US$ 28.83 30.00 29.44 29.55 29.70
Long-term indebtedness, gross US$ 166,257 132,655 119,394 109,691 109,691
Short-term indebtedness, gross US$ 188,795 164,003 158,204 171,223 171,223
---------------------------------------------------------------
Total indebtedness, gross US$ 355,052 296,658 277,598 280,914 280,914
===============================================================
Stockholders' equity R$ 418,290 447,693 399,275 451,942 451,942
===============================================================
Net operating revenues R$ 197,904 190,671 166,905 208,039 763,519
Cost of products R$ (95,771) (80,978) (73,499) (102,700) (352,948)
Other expenses/revenues R$ (18,514) (19,602) (12,796) (16,464) (67,376)
Depreciation, amortization and depletion R$ 9,268 8,113 5,793 2,503 25,677
---------------------------------------------------------------
EBITDA R$ 92,887 98,204 86,403 91,378 368,872
Depreciation, amortization and depletion R$ (9,268) (8,113) (5,793) (2,503) (25,677)
---------------------------------------------------------------
EBIT R$ 83,619 90,091 80,610 88,875 343,195
Other expenses/revenues - non cash R$ (5,275) (2,993) (4,433) (19,675) (32,376)
Gain on investments accounted for by the equity method R$ (3,570) (4,541) (9,266) 16,582 (795)
Non-operating result R$ - 16 (19,440) (461) (19,885)
Net financial result R$ (63,754) (45,453) (97,984) 50,563 (156,628)
---------------------------------------------------------------
Income before income tax and social contribution R$ 11,020 37,120 (50,513) 135,884 133,511
Income tax and social contribution R$ (3,324) (7,657) 2,093 (18,503) (27,391)
---------------------------------------------------------------
Net income R$ 7,696 29,463 (48,420) 117,381 106,120
------------------------------------------------------------------------------------------------------------------------------------
50 CVRD
8.11 - Iron Ore Area - FERTECO (Adjusted and Non-Audited) Attachment I
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Information 2002
------------------------------------------------------------------------------------------------------------------------------------
1st 2nd 3rd 4th
Quarter Quarter Quarter Quarter Total
-----------------------------------------------------------------------------------------------------------------------------------
Quantity sold - external market MT (thousand) 2,470 3,434 3,335 - 9,239
Quantity sold - internal market MT (thousand) 789 1,343 2,285 - 4,417
----------------------------------------------------
Quantity sold - total MT (thousand) 3,259 4,777 5,620 - 13,656
====================================================
Average sales price - external market US$ 16.91 19.00 17.21 - 17.80
Average sales price - internal market US$ 12.98 17.10 10.78 - 13.09
Average sales price - total US$ 15.96 18.47 14.60 - 16.28
Long-term indebtedness, gross US$ 94,359 88,367 74,490 - 74,490
Short-term indebtedness, gross US$ 55,244 58,473 51,922 - 51,922
----------------------------------------------------
Total indebtedness, gross US$ 149,603 146,840 126,412 - 126,412
====================================================
Stockholders' equity R$ 215,058 544,020 568,381 - 568,381
====================================================
Net operating revenues R$ 126,852 195,290 302,477 - 624,619
Cost of products R$ (70,019) (127,765) (186,549) - (384,333)
Other expenses/revenues R$ (12,481) (12,121) (18,000) - (42,602)
Depreciation, amortization and depletion R$ 7,273 7,591 6,222 - 21,086
----------------------------------------------------
EBITDA R$ 51,625 62,995 104,150 - 218,770
Depreciation, amortization and depletion R$ (7,273) (7,591) (6,222) - (21,086)
----------------------------------------------------
EBIT R$ 44,352 55,404 97,928 - 197,684
Others expenses/revenues - no cash R$ - (16,951) 2,917 - (14,034)
Result of Investments Participation (** ) R$ 9 (28,710) (20,327) - (49,028)
Non-operating result R$ (216) 121 194 - 99
Net financial result R$ (4,575) (44,260) (59,169) - (108,004)
----------------------------------------------------
Income before income tax and social contribution R$ 39,570 (34,396) 21,543 - 26,717
Income tax and social contribution R$ (10,519) 24,344 2,818 - 16,643
----------------------------------------------------
Net income R$ 29,051 (10,052) 24,361 - 43,360
------------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Information 2001
------------------------------------------------------------------------------------------------------------------------------------
1st 2nd 3rd 4th
Quarter Quarter Quarter Quarter Total
------------------------------------------------------------------------------------------------------------------------------------
Quantity sold - external market MT (thousand) - 3,955 3,556 3,653 11,164
Quantity sold - internal market MT (thousand) - 598 455 699 1,752
---------------------------------------------------------------
Quantity sold - total MT (thousand) - 4,553 4,011 4,352 12,916
===============================================================
Average sales price - external market US$ - 16.50 17.50 18.43 17.05
Average sales price - internal market US$ - 5.35 14.72 8.79 9.40
Average sales price - total US$ - 15.16 17.18 16.83 16.11
Long-term indebtedness, gross US$ - 101,394 103,737 95,887 95,887
Short-term indebtedness, gross US$ - 86,257 72,200 52,696 52,696
---------------------------------------------------------------
Total indebtedness, gross US$ - 187,651 175,937 148,583 148,583
===============================================================
Stockholders' equity R$ - 225,625 204,610 193,506 193,506
===============================================================
Net operating revenues R$ - 167,796 175,874 200,643 544,313
Cost of products R$ - (101,601) (86,911) (183,464) (371,976)
Other expenses/revenues R$ - (23,309) (24,832) (16,032) (64,173)
Depreciation, amortization and depletion R$ - 2,235 3,375 3,794 9,404
EBITDA R$ - 45,121 67,506 4,941 117,568
---------------------------------------------------------------
Depreciation, amortization and depletion R$ - (2,235) (3,375) (3,794) (9,404)
EBIT R$ - 42,886 64,131 1,147 108,164
---------------------------------------------------------------
Others expenses/revenues - no cash R$ - - - - -
Result of Investments Participation (* * ) R$ - (3,671) (2,041) 16 (5,696)
Non-operating result R$ - (106) (95) (173) (374)
Net financial result R$ - (31,412) (76,425) 44,716 (63,121)
---------------------------------------------------------------
Income before income tax and social contribution R$ - 7,697 (14,430) 45,706 38,973
Income tax and social contribution R$ - (5,354) 9,020 4,067 7,733
---------------------------------------------------------------
Net income R$ - 2,343 (5,410) 49,773 46,706
------------------------------------------------------------------------------------------------------------------------------------
(*) After acquisition on 04/01
(**) Includes R$ 21,040 of provision for loss at MRS and R$7,670 of
amortization of goodwill at MRS.
CVRD 51
8
8.12 - Manganese and Ferro Alloys Area - SIBRA (Adjusted and Non-Audited) Attachment I
-----------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------
Information 2002
-----------------------------------------------------------------------------------------------------------------------------
1st 2nd 3rd 4th
Quarter Quarter Quarter Quarter Total
------------------------------------------------------------------------------------------------------------------------------
Quantity sold - external market - ferro alloy MT (thousand) 10 15 33 - 58
Quantity sold - internal market - ferro alloy MT (thousand) 19 16 19 - 54
Quantity sold - total MT (thousand) 29 31 52 - 112
=====================================================
Quantity sold - external market - manganese MT (thousand) 242 213 181 - 636
Quantity sold - internal market - manganese MT (thousand) 36 52 94 - 182
Quantity sold - total MT (thousand) 278 265 275 - 818
=====================================================
Average sales price - external market - ferro alloy US $ 465.60 379.66 431.18 - 446.47
Average sales price - internal market - ferro alloy US $ 434.86 496.27 359.65 - 452.73
Average sales price - total US $ 445.67 439.85 402.46 - 445.85
Average sales price - external market - manganese US $ 52.99 46.36 47.44 - 48.54
Average sales price - internal market - manganese US $ 69.56 53.46 45.14 - 58.63
Average sales price - total US $ 55.11 47.75 46.81 - 54.68
Long-term indebtedness, gross US $ 24,720 21,499 18,873 - 18,873
Short-term indebtedness, gross US $ 24,465 22,503 20,260 - 20,260
-----------------------------------------------------
Total indebtedness, gross US $ 49,185 44,002 39,133 - 39,133
=====================================================
Stockholders' equity R $ 242,845 265,581 311,741 - 311,741
=====================================================
Net operating revenues R $ 62,105 59,941 99,106 - 221,152
Cost of products R $ (31,569) (35,842) (59,667) - (127,078)
Other expenses/revenues R $ (2,024) (5,017) (8,252) - (15,293)
Depreciation, amortization and depletion R $ 2,186 2,240 2,135 - 6,561
-----------------------------------------------------
EBITDA R $ 30,698 21,322 33,322 - 85,342
Depreciation, amortization and depletion R $ (2,186) (2,240) (2,135) - (6,561)
-----------------------------------------------------
EBIT R $ 28,512 19,082 31,187 - 78,781
Gain on investments accounted for by the equity method R $ 9,061 9,057 15,509 - 33,627
Non-operating result R $ (234) 133 3,210 - 3,109
Net financial result R $ (1,784) (5,100) 7,729 - 845
-----------------------------------------------------
Income before income tax and social contribution R $ 35,555 23,172 57,635 - 116,362
Income tax and social contribution R $ (1,994) (1,244) (11,479) - (14,717)
-----------------------------------------------------
Net income R $ 33,561 21,928 46,156 - 101,645
------------------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------------------------
Information 2001
------------------------------------------------------------------------------------------------------------------------------------
1st 2nd 3rd 4th
Quarter Quarter Quarter Quarter Total
------------------------------------------------------------------------------------------------------------------------------------
Quantity sold - external market - ferro alloy MT (thousand) 10 9 7 10 36
Quantity sold - internal market - ferro alloy MT (thousand) 15 15 14 81 125
Quantity sold - total MT (thousand) 25 24 21 91 161
=====================================================
Quantity sold - external market - manganese MT (thousand) 189 337 284 288 1,098
Quantity sold - internal market - manganese MT (thousand) 22 2 22 26 72
Quantity sold - total MT (thousand) 211 339 306 314 1,170
=====================================================
Average sales price - external market - ferro alloy US $ 650.08 570.11 542.65 475.42 519.40
Average sales price - internal market - ferro alloy US $ 538.29 441.24 422.62 236.53 196.92
Average sales price - total US $ 582.53 489.44 460.70 314.01 267.67
Average sales price - external market - manganese US $ 39.41 45.61 47.71 49.44 46.27
Average sales price - internal market - manganese US $ 61.44 245.17 67.07 48.72 60.15
Average sales price - total US $ 41.74 46.54 49.13 49.38 47.13
Long-term indebtedness, gross US $ 41,322 51,374 43,986 23,937 23,937
Short-term indebtedness, gross US $ 35,241 24,292 20,457 25,102 25,102
----------------------------------------------------
Total indebtedness, gross US $ 76,563 75,666 64,443 49,039 49,039
=====================================================
Stockholders' equity R $ 135,167 155,189 161,011 210,144 210,144
=====================================================
Net operating revenues R $ 44,719 58,425 16,260 104,173 223,577
Cost of products R $ (28,943) (25,469) (9,957) (63,997) (128,366)
Other expenses/revenues R $ (20,865) (3,627) 247 10,018 (14,227)
Depreciation, amortization and depletion R $ - 5,278 1,984 3,246 10,508
----------------------------------------------------
EBITDA R $ (5,089) 34,607 8,534 53,440 91,492
Depreciation, amortization and depletion R $ - (5,278) (1,984) (3,246) (10,508)
----------------------------------------------------
EBIT R $ (5,089) 29,329 6,550 50,194 80,984
Gain on investments accounted for by the equity method R $ 4,922 1,617 307 9,607 16,453
Non-operating result R $ (481) (2,722) (662) (2,158) (6,023)
Net financial result R $ (5,272) (4,009) 641 (14,040) (22,680)
----------------------------------------------------
Income before income tax and social contribution R $ (5,920) 24,215 6,836 43,603 68,734
Income tax and social contribution R $ - (4,192) (1,014) 5,531 325
----------------------------------------------------
Net income R $ (5,920) 20,023 5,822 49,134 69,059
-----------------------------------------------------------------------------------------------------------------------------
52 CVRD
8.13- Manganese and Ferroalloys Area - CPFL (Adjusted and Non-Audited) Attachment I
-----------------------------------------------------------------------------------------------------------------------------------
Information 2002
------------------------------------------------------------------------------------------------------------------------------------
1st 2nd 3rd 4th
Quarter Quarter Quarter Quarter Total
Quantity sold - external market MT (thousand) 13 17 34 - 64
Quantity sold - internal market MT (thousand) 24 20 21 - 65
----------------------------------------------------------------------
Quantity sold - total MT (thousand) 37 37 55 - 129
======================================================================
Average sales price - external market US $ 568.10 687.76 516.79 - 575.76
Average sales price - internal market US $ 489.47 468.73 442.61 - 514.26
Average sales price - total US $ 517.01 569.36 469.53 - 530.41
Long-term indebtedness, gross US $ 3,932 3,853 3,719 - 3,719
Short-term indebtedness, gross US $ 6,682 5,580 4,185 - 4,185
----------------------------------------------------------------------
Total indebtedness, gross US $ 10,614 9,433 7,904 - 7,904
======================================================================
Stockholders' equity R $ 138,780 148,438 165,027 - 165,027
======================================================================
Net operating revenues R $ 38,973 46,525 74,236 - 159,734
Cost of products R $ (27,073) (33,506) (46,291) - (106,870)
Other expenses/revenues R $ (2,192) (4,729) (8,546) - (15,467)
Depreciation, amortization and depletion R $ 1,046 1,060 981 - 3,087
----------------------------------------------------------------------
EBITDA R $ 10,754 9,350 20,380 - 40,484
Depreciation, amortization and depletion R $ (1,046) (1,060) (981) - (3,087)
----------------------------------------------------------------------
EBIT R $ 9,708 8,290 19,399 - 37,397
Gain on investments accounted for by the R $ 71 421 179 - 671
equity method
Non-operating result R $ (966) (250) (1,204) - (2,420)
Net financial result R $ 1,220 1,197 5,864 - 8,281
----------------------------------------------------------------------
Income before income tax and social R $ 10,033 9,658 24,238 - 43,929
contribution
Income tax and social contribution R $ - - (7,649) - (7,649)
----------------------------------------------------------------------
Net income R $ 10,033 9,658 16,589 - 36,280
-----------------------------------------------------------------------------------------------------------------------------------
Information 2001
------------------------------------------------------------------------------------------------------------------------------------
1st 2nd 3rd 4th
Quarter Quarter Quarter Quarter Total
------------------------------------------------------------------------------------------------------------------------------------
Quantity sold - external market MT (thousand) 18 20 14 13 65
Quantity sold - internal market MT (thousand) 16 17 14 43 90
--------------------------------------------------------------------
Quantity sold - total MT (thousand) 34 37 28 56 155
====================================================================
Average sales price - external market US 475.61 593.98 703.40 670.68 570.12
Average sales price - internal market US 598.83 570.29 1,035.79 237.39 462.01
Average sales price - total US 533.34 583.02 868.73 338.37 507.35
Long-term indebtedness, gross US 7,707 10,390 8,544 3,582 3,582
Short-term indebtedness, gross US 12,853 9,427 8,003 8,107 8,107
--------------------------------------------------------------------
Total indebtedness, gross US 20,560 19,817 16,547 11,689 11,689
====================================================================
Stockholders' equity R 110,615 112,711 119,849 128,747 128,747
====================================================================
Net operating revenues R 36,776 44,610 46,947 42,476 170,809
Cost of products R (26,004) (30,109) (35,119) (27,538) (118,770)
Other expenses/revenues R (4,884) (12,191) (1,191) (11,243) (29,509)
Depreciation, amortization and depletion R 909 909 909 909 3,636
--------------------------------------------------------------------
EBITDA R 6,797 3,219 11,546 4,604 26,166
Depreciation, amortization and depletion R (909) (909) (909) (909) (3,636)
--------------------------------------------------------------------
EBIT R 5,888 2,310 10,637 3,695 22,530
Gain on investments accounted for by the R (93) (242) - (1,586) (1,921)
equity method
Non-operating result R (164) (671) (871) (127) (1,833)
Net financial result R (497) 1,030 (138) 3,123 3,518
--------------------------------------------------------------------
Income before income tax and social R 5,134 2,427 9,628 5,105 22,294
contribution
Income tax and social contribution R - (336) (2,484) 3,793 973
--------------------------------------------------------------------
Net income R 5,134 2,091 7,144 8,898 23,267
CVRD 53
9- OPINION OF THE INDEPENDENT ACCOUNTANTS
November 13, 2002
To the Board of Directors
Companhia Vale do Rio Doce
1 We have carried out limited reviews of the Quarterly Financial
Information - ITR of Companhia Vale do Rio Doce for the quarters ended
September 30, 2002 and 2001. This financial information is the
responsibility of the Company's management.
2 Except as mentioned in paragraph three, our limited reviews were carried
out in accordance with the specific procedures established by the
Institute of Independent Auditors of Brazil (IBRACON), in conjunction
with the Federal Accounting Board, and consisted mainly of: (a) inquires
and discussion with the officers responsible for the Company's
accounting, financial and operational areas about the procedures adopted
for preparing the Quarterly Financial Information - ITR, and (b) review
of the information and subsequent events which have, or may have,
relevant effects on the Company's financial position and operations.
3 The financial statements at September 30, 2002 and 2001, of subsidiary,
jointly-owned and associated companies, in which there are relevant
investments, have not been reviewed by independent accountants. Thus, the
conclusions resulting from our reviews do not cover the amounts of R$
7,177,881 thousand (2001 - R$ 8,659,589 thousand) of these investments
and R$ 1,911,515 thousand (2001 - R$ 1,169,439 thousand) of the income
produced by them for the quarters then ended.
4 Based on our limited reviews, except for the effects of any adjustments
which might have been required if the financial statements of the
subsidiary, jointly-owned and associated companies mentioned in paragraph
3 had been reviewed by independent accountants, we are not aware of any
relevant adjustments which should be made to the Quarterly Financial
Information - ITR, referred to in paragraph 1, for it to be in accordance
with the rules issued by the Brazilian Securities Commission - CVM
specifically applicable to the preparation of obligatory Quarterly
Financial Information - ITR.
5 The Quarterly Financial Information - ITR also contains accounting and
financial information relating to the quarter ended June 30, 2002. We
reviewed this information at the time of its preparation and issued our
respective report on August 14, 2002, including the limitation mentioned
in paragraph 3.
PricewaterhouseCoopers
Independent Accountants
CRC-SP-160-S-RJ
Douglas H. Woods
Partner
Accountant CRC-SP-101.652/O-0-S-RJ
54 CVRD
10- MEMBERS OF THE BOARD OF DIRECTORS, AUDIT COMMITTEE, CHIEF EXECUTIVE
OFFICER, CHIEF FINANCIAL OFFICER AND EXECUTIVE OFFICERS
BOARD OF DIRECTORS Chief Executive Officer
Roger Agnelli
Luiz Tarquinio Sardinha Ferro
Chairman
Executive Officer of Finance
Erik Persson Fabio de Oliveira Barbosa
Renato Augusto Zagallo Villela dos Santos
Executive Officer of Planning
Francisco Valadares Povoa Gabriel Stoliar
Joao Moises Oliveira
Jose Marques de Lima Executive Officer of Human Resources and
Corporate Services
Carla Grasso
Octavio Lopes Castello Branco Neto
Renato da Cruz Gomes Executive Officer of Ferrous Minerals
Armando de Oliveira Santos Neto
Romeu do Nascimento Teixeira
Executive Officer of Logistics
Audit Committee Guilherme Rodolfo Laager
Claudio Bernardo Guimaraes de Moraes
Executive Officer of Holdings and
Eliseu Martins Business Development
Antonio Miguel Marques
Marcos Fabio Coutinho
Pedro Carlos de Mello Executive Officer of the Non-Ferrous
Diego Cristobal Hernandez Cabrera
Ricardo Wiering de Barros
Eduardo de Carvalho Duarte Otto de Souza Marques Junior
Chief Accountant Head of Control Department
CRC-RJ 57439
CVRD 55
SIGNATURES
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.
COMPANHIA VALE DO RIO DOCE
(Registrant)
Date: November 18, 2002
By: /s/ Fabio de Oliveira Barbosa
-----------------------------
Fabio de Oliveira Barbosa
Chief Financial Officer