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

Yes ______ No ___X___

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

SABESP announces 2Q08 results
São Paulo, August 8, 2008 - Companhia de Saneamento Básico do Estado de São Paulo – SABESP (Bovespa: SBSP3; NYSE: SBS), one of the largest water and sewage services providers in the world based on the number of customers, announces today its results for the second quarter of 2008 (2Q08). The Company’s operating and financial information, except when indicated otherwise, is presented in Brazilian Reais, in accordance with the Brazilian Corporate Law. All comparisons in this release, unless otherwise stated, refer to the same period of 2007.		SBSP3: R$ 40.48 / share
		SBS US$ 50.76 (ADR=2 shares)
		Total shares: 227,836,623
		Market value: R$ 9.3 billion
		Closing price: 08/08/2008

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1. Net Operating Revenue

														R$ million
		2Q07		2Q08		Chg.		%		1H07		1H08		Chg.		%
(+) Gross operating revenue		1,563.7		1,627.3		63.6		4.1		3,146.9		3,285.9		139.0		4.4
(-) COFINS and PASEP taxes		115.9		114.0		(1.9)		(1.6)		234.4		232.5		(1.9)		(0.8)
(=) Net operating revenue		1,447.8		1,513.3		65.5		4.5		2,912.5		3,053.4		140.9		4.8
(-) Costs and expenses		935.3		1,032.2		96.9		10.4		1,832.8		1,948.1		115.3		6.3
(=) Earnings before financial expenses (EBIT*)		512.5		481.1		(31.4)		(6.1)		1,079.7		1,105.3		25.6		2.4
(+) Depreciation and amortization		158.8		154.9		(3.9)		(2.5)		313.0		305.1		(7.9)		(2.5)
(=) EBITDA**		671.3		636.0		(35.3)		(5.3)		1,392.7		1,410.4		17.7		1.3
(%) EBITDA margin		46.4		42.0						47.8		46.2
Net income		295.5		360.0		64.5		21.8		588.4		663.7		75.3		12.8
Earnings per share (R$)		1.30		1.58						2.58		2.91
(*) Earnings before interest and taxes
(**) Earnings before interest, taxes, depreciation and amortization

In 2Q08, net operating revenue totaled R$ 1.5 billion, a 4.5% increase compared to 2Q07. Costs and expenses stood at R$ 1,032.2 million, 10.4% higher than in 2Q07. EBITDA moved from R$ 671.3 million in 2Q07 to R$ 636.0 million in 2Q08, a 5.3% drop.

Earnings before financial expenses (EBIT) dropped 6.1%, from R$ 512.5 million in 2Q07 to R$ 481.1 million in this quarter.

2. Gross operating revenue

In 2Q08, gross operating revenue grew R$ 63.6 million, or 4.1%, from R$ 1,563.7 million in 2Q07 to R$ 1,627.3 million in 2Q08. The main reasons for this increase were:

• The 4.1% tariff adjustment as of September 2007; and

• The 1.9% increase in billed water and sewage volume, 1.4% of which corresponded to the retail segment and 6.0% to wholesale.

This performance was due to:

• Lower temperatures in 2Q08 versus 2Q07;

• Consumption migration to lower tariff brackets as a result of: i) intensification of hydrometer replacing, which educates customers to reduce consumption and ii) the campaign for the rational use of water; and

• The loss of some wholesale customers in the coastal region and the discontinuation of billing in 3 municipalities in the inland region.

Page 2 of 12

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3. Billed volume

The following tables show billed water and sewage volume per customer category and region in 2Q07, 2Q08, 1H07 and 1H08.

BILLED WATER AND SEWAGE VOLUME (1) PER CUSTOMER CATEGORY - million m3
		Water						Sewage						Water + Sewage
		2Q07		2Q08		%		2Q07		2Q08		%		2Q07		2Q08		%
Residential		329.6		333.9		1.3		262.5		267.6		1.9		592.1		601.5		1.6
Commercial		37.6		38.1		1.3		34.6		35.3		2.0		72.2		73.4		1.7
Industrial		8.7		8.8		1.1		8.3		8.5		2.4		17.0		17.3		1.8
Public		12.6		12.1		(4.0)		10.0		9.7		(3.0)		22.6		21.8		(3.5)
Total retail		388.5		392.9		1.1		315.4		321.1		1.8		703.9		714.0		1.4
Wholesale		67.5		70.3		4.1		5.8		7.4		27.6		73.3		77.7		6.0
Reused water		-		0.1		-		-		-		-		-		0.1		-
Total		456.0		463.3		1.6		321.2		328.5		2.3		777.2		791.8		1.9
		1H07		1H08		%		1H07		1H08		%		1H07		1H08		%
Residential		668.9		674.7		0.9		530.4		538.7		1.6		1,199.3		1,213.4		1.2
Commercial		75.3		76.1		1.1		68.8		70.0		1.7		144.1		146.1		1.4
Industrial		17.4		17.6		1.1		16.6		16.8		1.2		34.0		34.4		1.2
Public		23.6		23.0		(2.5)		18.8		18.4		(2.1)		42.4		41.4		(2.4)
Total retail		785.2		791.4		0.8		634.6		643.9		1.5		1,419.8		1,435.3		1.1
Wholesale		134.2		140.9		5.0		11.9		14.7		23.5		146.1		155.6		6.5
Reused water		-		0.1		-		-		-		-		-		0.1		-
Total		919.4		932.4		1.4		646.5		658.6		1.9		1,565.9		1,591.0		1.6

BILLED WATER AND SEWAGE VOLUME (1) PER REGION - million m3
		Water						Sewage						Water + Sewage
		2Q07		2Q08		%		2Q07		2Q08		%		2Q07		2Q08		%
Metropolitan		258.9		263.9		1.9		214.6		220.1		2.6		473.5		484.0		2.2
Regional (2)		129.6		129.0		(0.5)		100.8		101.0		0.2		230.4		230.0		(0.2)
Total retail		388.5		392.9		1.1		315.4		321.1		1.8		703.9		714.0		1.4
Wholesale		67.5		70.3		4.1		5.8		7.4		27.6		73.3		77.7		6.0
Reused water		-		0.1		-		-		-		-		-		0.1		-
Total		456.0		463.3		1.6		321.2		328.5		2.3		777.2		791.8		1.9
		1H07		1H08		%		1H07		1H08		%		1H07		1H08		%
Metropolitan		521.1		527.5		1.2		430.5		438.2		1.8		951.6		965.7		1.5
Regional (2)		264.1		263.9		(0.1)		204.1		205.7		0.8		468.2		469.6		0.3
Total retail		785.2		791.4		0.8		634.6		643.9		1.5		1,419.8		1,435.3		1.1
Wholesale		134.2		140.9		5.0		11.9		14.7		23.5		146.1		155.6		6.5
Reused water		-		0.1		-		-		-		-		-		0.1		-
Total		919.4		932.4		1.4		646.5		658.6		1.9		1,565.9		1,591.0		1.6
(1) Not revised by the Independent Auditors
(2) Including coastal and interior regions

Page 3 of 12

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4. Costs, administrative and selling expenses

In 2Q08, costs, administrative and selling expenses grew R$ 96.9 million, or 10.4% .

													R$ million
	2Q07		2Q08		Chg.		%		1H07		1H08		Chg.		%
Payroll and benefits	320.8		343.6		22.8		7.1		621.6		662.6		41.0		6.6
Supplies	34.9		35.5		0.6		1.7		67.0		66.3		(0.7)		(1.0)
Treatment supplies	29.5		27.9		(1.6)		(5.4)		65.0		67.9		2.9		4.5
Third-party services	135.2		152.5		17.3		12.8		262.0		280.9		18.9		7.2
Electric power	124.5		115.5		(9.0)		(7.2)		242.8		229.1		(13.7)		(5.6)
General expenses	50.7		61.4		10.7		21.1		95.5		129.7		34.2		35.8
Tax expenses	7.9		6.6		(1.3)		(16.5)		16.6		14.7		(1.9)		(11.4)
Sub-total	703.5		743.0		39.5		5.6		1,370.5		1,451.2		80.7		5.9
Depreciation and amortization	158.8		154.9		(3.9)		(2.5)		313.0		305.1		(7.9)		(2.5)
Credit write-offs	73.0		134.3		61.3		84.0		149.3		191.8		42.5		28.5
Costs, administrative and selling expenses	935.3		1,032.2		96.9		10.4		1,832.8		1,948.1		115.3		6.3
% over net revenue	64.6%		68.2%						62.9%		63.8%

4.1. Payroll and benefits

In 2Q08, payroll and benefits grew R$ 22.8 million or 7.1%, from R$ 320.8 million to R$ 343.6 million, due to the:

• Wage increase of 3.37% (IPC-FIPE) as of May 2007 and of 5.03% as of May 2008; and

• R$ 2.3 million increase in provision for pension plan obligations, due to the change in the discount rate used for actuarial calculation from 8% in 2007 to 6.59% in 2008.

4.2. Supplies

In 2Q08, supplies grew R$ 0.6 million or 1.7%, from R$ 34.9 million to R$ 35.5 million, mainly referring to the water loss reduction program.

4.3. Treatment supplies

In 2Q08, expenses with chemical products were R$ 1.6 million or 5.4% lower than in 2Q07, dropping from R$ 29.5 million in 2Q07 to R$ 27.9 million in 2Q08 due to the improvement in the quality of abstracted water and the use of substitute chemical products.

4.4. Third party services

In 2Q08, services grew R$ 17.3 million or 12.8%, from R$ 135.2 million to R$ 152.5 million. The main reasons for this increase were:

• Preventive and corrective maintenance at the water and sewage treatment systems, totaling R$ 12.4 million;

• Professional technical services of R$ 4.8 million for the management of projects and works, as well as of the quality of maintenance services;

• Expenses with paving and pavement replacing services in the amount of R$ 2.3 million;

• Hydrometer reading and bill delivery in the amount of R$ 2.2 million, due to the expansion of the TACE (external technical sales service) agreement scope, including building examination;

• Expenses with risk contracts for the recovery of credits in the amount of R$ 1.6 million; and

• Increase of R$ 1.2 million in surveillance services due to the expansion of the area with electronic monitoring;

Page 4 of 12

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• Expenses with fraud prevention, in the amount of R$ 1.0 million; and

• Expenses with fire prevention, detection and fighting, in the amount of R$ 0.8 million.

The factors that favorably contributed by R$ 10.5 million in 2Q08 versus 2Q07 were:

• The accounting effect of booking expenses of R$ 7.7 million related to software licenses; and

• Decline of R$ 2.8 million in advertising expenses.

4.5. Electric power

Electric power dropped R$ 9.0 million or 7.2%, from R$ 124.5 million to R$ 115.5 million.

This result was due to the 12.0% drop in the tariff from the captive market, responsible for 77.0% of total expenses with electric power.

		Participation (%)		Avg. price (Chg. %)		Weighted average (%)
Free market		23.0		10.0		2.3
Captive market		77.0		(12.0)		(9.2)
						(6.9)

4.6. General expenses

In 2Q08, general expenses increased R$ 10.7 million or 21.1%, from R$ 50.7 million to R$ 61.4 million, due to the:

• Increase of R$ 7.6 million in provisions for contingencies, mainly as a result of the filing of new lawsuits;

• Upturn of R$ 1.9 million in the payment for the use of water resources in the Piracicaba, Capivari, Jundiaí, Jaguarí, Atibaia and Paraíba do Sul river basins. This increase in collection resulted from a state law approval, as of July 2007.

4.7. Depreciation and amortization

Recorded a R$ 3.9 million or 2.5% drop, from R$ 158.8 million to R$ 154.9 million, due to a lower transfer of works to permanent assets in operation in 2Q08 versus the same period of the previous year.

4.8. Credit write-offs

In 2Q08 credit write-offs grew R$ 61.3 million or 84.0%, from R$ 73.0 million to R$ 134.3 million, due to the need to complement provisions for past-due debts for:

• Municipalities which the Company supplies with wholesale water and sewage services: This is a temporary difference between billed and received amounts. These amounts were being provisioned after they had been overdue 360 days and are now being booked as soon they become overdue. The amount booked in the 2Q came to R$ 38 million. After the completion of the 360-day cycle, the amount booked for each quarter will represent only the period’s debit, except in cases of reception; and

• Private customers: The amount past due for more than 360 days increased more than the provisioned amount. Due to this difference, the Company had to complement the provisions by R$ 23 million this quarter. Although several outsourced collection contracts are already in force, their effect could not be measured in the period.

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4.9. Tax expenses

In 2Q08, tax expenses dropped R$ 1.3 million or 16.5%, due to the R$ 6.9 million reduction as a result of the extinction of the CPMF tax.

This drop was partially offset by the:

• Revocation of the exemption from the Municipal Real Estate Tax (IPTU) in the amount of R$ 2.9 million;

• Payment of the Tax on Financial Transactions – IOF of R$1.6 million resulting from the AB LOAN funding operation in June 2008; and

• IOF tax over financial remittance totaling R$ 0.6 million due to the settlement of the 2008 Eurobonds.

5. Financial revenues and expenses

5.1. Financial expenses

								R$ million
		2Q07		2Q08		Var.		%
Financial expenses
Interest and charges on domestic loans and financing		114.6		103.5		(11.1)		(9.7)
Interest and charges on international loans and financing		16.5		13.3		(3.2)		(19.4)
Interest rate over foreign remittance		1.7		1.4		(0.3)		(17.6)
Interest rate over lawsuit indemnity, net of provisions		5.8		56.5		50.7		874.1
Other financial expenses		5.9		(60.7)		(66.6)		(1,128.8)
Total financial expenses		144.5		114.0		(30.5)		(21.1)
Financial revenues		29.8		27.4		(2.4)		(8.1)
Financial expenses net of revenues		114.7		86.6		(28.1)		(24.5)

In 2Q08 financial expenses dropped R$ 30.5 million, or 21.1%, as follows:

• Regarding domestic financing, we highlight the R$ 11.1 million drop in interest from domestic financing due to the settlement of the 1^st series of the 6^th debenture issue and the amortization of other financing;

• Regarding international financing, we highlight the R$ 3.2 million drop in interest due to the amortizations held in the period and to the appreciation of the Brazilian Real against the US Dollar;

• Interest on lawsuit damages grew R$ 50.7 million; and

• Other financial expenses recorded a R$ 66.6 million decrease, due to the adjustment of the calculation of interest for the special installment program (PAES).

5.2. Financial revenues

Financial revenues dropped R$ 2.4 million due to a lower volume of short-term investments in the period.

6. Foreign exchange and indexation

6.1. Variation on liabilities

								R$ million
		2Q07		2Q08		Var.		%
Monetary variation over loans and financing		12.6		46.7		34.1		270.6
Currency exchange variation over loans and financing		(74.3)		(104.3)		(30.0)		40.4
Other variations		3.8		7.7		3.9		102.6
Variation on liabilities		(57.9)		(49.9)		8.0		(13.8)

The net effect of the foreign exchange and indexation was R$ 8.0 million positive in 2Q08 versus 2Q07, due to:

Page 6 of 12

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• R$ 34.1 million increase in the monetary variation over debentures, resulting from a higher variation of the IGPM Index, of 5.11% in 2Q08, versus 0.68% in the previous period, partially offset by a lower variation of the TR, 0.32% in 2Q08 versus 0.58% in the previous period; as well as the decrease in the debit balance;

• The higher appreciation of the Brazilian Real against US dollar in 2Q08 (9.0%), versus 2Q07 (6.1%) and a decrease in the currency basket value, (2.0%) in 2Q08 versus (0.9%) in 2Q07, generating a net variation of R$ 30.0 million; and

• Other monetary restatement from lawsuit damages with a R$ 3.9 million increase.

6.2. Variation on assets

Foreign exchange and indexation increased R$ 9.8 million, mainly due to customer installment agreements.

7. Non-operating result

Non-operating result dropped R$ 1.0 million, or 83.3%, from R$ 1.2 million in 2Q07 to R$ 0.2 million in 2Q08, due to the following:

• Non-operating revenues moved up R$ 3.5 million, from R$ 2.7 million to R$ 6.2 million in 2Q08, mainly due to the sale of exceeding electric power and scrap; and

• Non-operating expenses grew R$ 1.4 million or 41.2%, due to the write-off of discontinued works and obsolete projects.

8. Operating indicators

The following table shows the continuous expansion of the services rendered by the Company:

Operating indicators*		2Q07		2Q08		%
Water connections (1)		6,690		6,846		2.3
Sewage connections (1)		5,077		5,237		3.2
Population directly served - water (2)		22.8		23.1		1.1
Population directly served - sewage (2)		18.7		19.0		1.7
Number of employees		16,922		16,757		(1.0)
Number of water and sewage connections per employee		695		721		3.7
Water volume produced		1,438.5		1,424.6		(1.0)
Water losses (%)		30.8		28.6		(7.1)

(1) In thousand units at the end of the period
(2) In thousand inhabitants at the end of the period, not including wholesale
(*) Not revised by our independent auditors

Page 7 of 12

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9. Loans and financing

At the table below we present the debt amortization schedule:

																R$ million
INSTITUTION		2008		2009		2010		2011		2012		2013		2014 and  onwards		Total
Local market
Banco do Brasil		122.2		260.4		283.5		308.5		335.8		365.5		96.3		1,772.2
Caixa Econômica Federal		31.4		65.8		70.7		76.5		82.7		83.2		199.1		609.4
Debentures		-		783.6		343.2		413.8		-		-		-		1,540.6
FIDC - SABESP I		27.8		55.5		55.5		13.9		-		-		-		152.7
BNDES		21.0		42.0		42.0		42.0		36.0		4.0		-		187.0
Others		1.5		4.9		6.6		6.0		-		-		-		19.0
Interest and charges		78.5		28.0		18.2		4.6		-		-		-		129.3
Local market total		282.4		1,240.2		819.7		865.3		454.5		452.7		295.4		4,410.2
International market
IDB		29.9		59.8		59.9		59.8		59.9		59.8		345.2		674.3
Eurobonds		-		-		-		-		-		-		222.9		222.9
JBIC		-		-		-		2.3		4.5		4.5		72.1		83.4
BID 1983AB		-		-		-		38.1		38.1		38.1		283.6		397.9
Interest and charges		12.7		-		-		-		-		-		-		12.7
International market total		42.6		59.8		59.9		100.2		102.5		102.4		923.8		1,391.2
Total		325.0		1,300.0		879.6		965.5		557.0		555.1		1,219.2		5,801.4

Page 8 of 12

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10. Conference Calls

In English		In Portuguese
August 12, 2008		August 12, 2008
3:30 PM (US EST) / 4:30 PM (Brasília)		1:00 PM (US EST) / 2:00 PM (Brasília)
Dial-in access: 1 412 858-4600		Dial-in access: 55 11 2188-0188
Conference ID: Sabesp		Conference ID: Sabesp
Replay – available until August 18, 2008		Replay – available until August 18, 2008
Dial-in access: 1 412 317-0088		Dial-in access: 55 11 2188-0188
Replay ID: 6097#		Replay ID: Sabesp

Live webcast at www.sabesp.com.br

For more information, please contact:

Mario Arruda Sampaio
Ph.(55 11) 3388-8664
E-mail: maasampaio@sabesp.com.br

Angela Beatriz Airoldi
Ph.(55 11) 3388-8793
E-mail: abairoldi@sabesp.com.br

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

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Income Statement

Corporate Law Method (Law No. 6,404/76)						R$ '000
		2Q08		2Q07		%
Gross Revenue from Sales and Services		1,627,339		1,563,707		4.1
Water Supply - Retail		830,665		803,687		3.4
Water Supply - Wholesale		77,017		71,034		8.4
Sewage Collection and Treatment		689,955		662,667		4.1
Sewage Collection and Treatment - Wholesale		4,102		1,797		-
Other Services		25,600		24,522		4.4
Taxes on Sales and Services - COFINS and PASEP		(113,987)		(115,889)		(1.6)
Net Revenue from Sales and Services		1,513,352		1,447,818		4.5
Costs of Sales and Services		(702,737)		(677,963)		3.7
Gross Profit		810,615		769,855		5.3
Selling Expenses		(224,970)		(152,960)		47.1
Administrative Expenses		(104,543)		(104,437)		0.1
Operating Income before Financial Expenses and		481,102		512,458		(6.1)
Foreing Exchange gain (loss), net
Financial Income and Expenses, net		(124,919)		(124,540)		0.3
Foreing Exchange gain (loss), net		104,676		74,283		40.9
Operating Income		460,859		462,201		(0.3)
Non-Operating Expenses (Income)
Non-Operating Income		4,612		2,210		108.7
Non-Operating Expense		(4,806)		(3,352)		43.4
Income (loss) before Taxes on Income		460,665		461,059		(0.1)
Income and Social Contribution Taxes
Current Income Tax/Social Contribution		(131,384)		(153,864)		(14.6)
Deferred Income Tax/Social Contribution		30,738		(11,655)		(363.7)
Income (loss) before Extraordinary Item		360,019		295,540		21.8
Extraordinary item, net of income taxes and social contribution		-		-		-
Net Income (loss)		360,019		295,540		21.8
Registered common shares (thousand of shares)		227,836		227,836		-
Earnings per shares R$ (per thousand shares in 2007)		1.58		10.38		-
Depreciation and Amortization		(154,943)		(158,850)		(2.5)
EBITDA		636,045		671,308		(5.3)
% over net revenue		42.0%		46.4%

Page 10 of 12

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Balance Sheet

Brazilian Corporate Law				R$ '000
ASSETS		06/30/2008		03/31/2008
Cash and Cash Equivalents		352,781		380,225
Accounts Receivable, net		1,101,724		1,226,632
Accounts Receivable from Shareholders		134,132		117,727
Inventory		42,266		45,436
Taxes and contributions		3,495		2,934
Other Receivables		29,490		67,726
Deferred income tax and social contribution		120,308		93,822
Total Current Assets		1,784,196		1,934,502
Long Term Assets:
Accounts Receivable, net		314,218		296,956
Accounts Receivable from Shareholders		1,064,112		1,042,144
Indemnities Receivable		148,794		148,794
Judicial Deposits		31,290		22,880
Taxes and contributions		385,919		379,364
Agreement with the Municipality of São Paulo		57,146		-
Other Receivables		87,085		76,519
		2,088,564		1,966,657
Permanent Assets:
Investments		720		720
Permanent Assets		14,248,536		14,123,586
Intangible Assets		578,141		562,075
Deferred Assets		1,912		2,641
		14,829,309		14,689,022
Total Permanent Assets		16,917,873		16,655,679
Total Assets		18,702,069		18,590,181
LIABILITIES		06/30/2008		03/31/2008
Suppliers and Constructors		122,248		106,953
Loans and Financing		1,131,865		980,119
Salaries and Payroll Charges		196,422		185,201
Taxes and contributions payable		109,870		171,085
Taxes and contributions		70,816		74,531
Interest on Own Capital Payable		186,178		279,515
Provision for Judicial Pendencies		324,207		247,816
Services Payable		139,500		175,525
Other Payables		70,247		49,357
Total Current Liabilities		2,351,353		2,270,102
Long Term Liabilities:
Loans and Financing		4,669,561		4,711,501
Taxes and Contributions Payable		128,265		189,740
Deferred Taxes and Contributions		132,130		126,384
Provision for Contingencies		657,818		700,709
Pension Fund Obligations		392,250		378,630
Other Payables		111,711		122,284
		6,091,735		6,229,248
Future Results:
Donations		11,727		3,100
		11,727		3,100
Total Non Current Liabilities		6,103,462		6,232,348
Capital Stock		6,203,688		3,403,688
Capital Reserves		124,255		124,255
Revaluation Reserves		2,296,421		2,318,144
Profit Reserves		1,116,234		3,916,234
Accrued income		506,656		325,410
Shareholder's Equity		10,247,254		10,087,731
Total Liabilities and Shareholder's Equity		18,702,069		18,590,181

Page 11 of 12

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Cash Flow

Brazilian Corporate Law				R$ '000
Description		Apr-Jun/08		Apr-jun/07
Cash flow from operating activities
Net income for the period		360,019		295,540
Adjustments for reconciliation of net income
Deferred income tax and social contribution		(31,010)		14,553
Provision for taxes and contributions payable		(68,878)		-
Provisions for contingencies		134,594		29,479
Reversion of provision for losses		140		(44)
Other provisions		121		89
Liabilities related to pension plans		17,658		14,999
Loss in the write-off of property, plant and equipment		3,455		2,431
Deferred asset write-offs		7		475
Depreciation and Amortization		154,943		158,850
Interest calculated on loans and financing payable		118,207		132,834
Foreign exchange loss on loans and financing		(57,630)		(61,689)
Passive monetary exchange variation and interest		2,314		3,177
Active monetary exchange variation and interest		(6,153)		(3,495)
Provisions for bad debt		134,306		72,983
(Increase) decrease in assets:
Clients		(26,146)		(33,361)
Accounts receivable from shareholders		(34,585)		(29,618)
Inventories		3,030		2,087
Recoverable Taxes		(561)		25,485
Other accounts receivable		(39,590)		(12,151)
Judicial deposits		(1,415)		(530)
Increase (decrease) in liabilities:
Accounts payable to suppliers and contractors		1,298		31,150
Salaries and payroll charges		11,221		37,590
Retained income tax over interest on own capital		(14,371)		-
Taxes and contributions		(56,126)		(76,610)
Services payable		(6,992)		27,642
Other accounts payable		(2,519)		2,348
Contingencies		(107,017)		(65,658)
Pension plan		(4,038)		(3,725)
Net cash from operating activities		484,282		564,831
Cash flow from investing activities:
Acquisition of property, plant and equipment		(275,217)		(201,451)
Increase in intangible assets		(27,435)		(2,925)
Net cash used in investing activities		(302,652)		(204,376)
Cash flow from financing activities
Loans and Financing - long term
Funding		506,118		92,630
Payments		(435,730)		(280,433)
Interest on own capital payment		(279,462)		(115,082)
Net cash used in financing activities		(209,074)		(302,885)
Net increase (decrease) in cash equivalents		(27,444)		57,570
Cash and cash equivalents at the beginning of the period		380,225		453,731
Cash and cash equivalents at the end of the period		352,781		511,301
Change in Cash		(27,444)		57,570
Additional information on cash flow:
Interest and taxes over loans and financing		157,338		162,377
Capitalization of interest and financial charges		(21,159)		(7,918)
Payable income tax and social contribution		178,957		182,172
Property, plant and equip. received as donation and/or paid in stocks		8,627		1,922
COFINS and PASEP taxes payable		124,559		125,415
Liabilities from agreements		(16,318)		-

Page 12 of 12

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

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