sbspr1q18_6k.htm - Generated by SEC Publisher for SEC Filing
 
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
 

 
FORM 6-K
 
REPORT OF FOREIGN ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 OF THE
SECURITIES EXCHANGE ACT OF 1934
 
For May, 2018
(Commission File No. 1-31317)
 

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


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



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

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

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

Yes ______ No ___X___

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

 

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

 

SABESP announces 1Q18 results

São Paulo, May 10, 2018 - Companhia de Saneamento Básico do Estado de São Paulo - SABESP (B3: SBSP3; NYSE: SBS), one of the largest water and sewage services providers in the world based on the number of costumers, announces today its 1Q18 results. 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 2017.

 

SBSP3: R$ 30.73/share
SBS: US$ 8.58 (ADR=1 share)
Total shares: 683,509,869
Market value: R$ 20.04 billion
Closing quote: 05/10/2018

 


 

1.    Financial highlights

R$ million 
    1Q18  1Q17   Chg. (R$) % 
  Gross operating revenue ¹  3,280.8  3,029.3  251.5  8.3 
  Construction revenue  647.2  722.9  (75.7)  (10.5) 
  COFINS and PASEP and TRCF taxes ²  (228.4)  (193.4)  (35.0)  18.1 
(=)  Net operating revenue  3,699.6  3,558.8  140.8  4.0 
  Costs and expenses  (1,998.7)  (1,832.0)  (166.7)  9.1 
  Construction costs  (632.7)  (707.2)  74.5  (10.5) 
  Equity result  2.8  1.8  1.0  55.6 
  Other operating revenue (expenses), net  11.5  10.6  0.9  8.5 
(=)  Earnings before financial result, income tax and social contribution  1,082.5  1,032.0  50.5  4.9 
  Financial result  (193.9)  3.8  (197.7)  (5,202.6) 
(=)  Earnings before income tax and social contribution  888.6  1,035.8  (147.2)  (14.2) 
  Income tax and social contribution  (308.2)  (361.4)  53.2  (14.7) 
(=)  Net income  580.4  674.4  (94.0)  (13.9) 
  Earnings per share* (R$)  0.85  0.99     
¹ Includes Revenue from Regulatory, Control and Inspection Fee (TRCF - Taxa de Regulação, Controle e Fiscalização), in the amount of R$ 15.5 million.
² Includes TRCF transfers in the amount of R$ 13.5 million.
* Total shares = 683,509,869

 

Adjusted EBITDA Reconciliation (Non-accounting measures)

 
R$ million 
    1Q18  1Q17  Chg. (R$)  % 
  Net income  580.4  674.4  (94.0)  (13.9) 
  Income tax and social contribution  308.2  361.4  (53.2)  (14.7) 
  Financial result  193.9  (3.8)  197.7  (5,202.6) 
  Other operating revenues (expenses), net  (11.5)  (10.6)  (0.9)  8.5 
(=)  Adjusted EBIT*  1,071.0  1,021.4  49.6  4.9 
  Depreciation and amortization  328.0  332.0  (4.0)  (1.2) 
(=)  Adjusted EBITDA **  1,399.0  1,353.4  45.6  3.4 
  (%) Adjusted EBITDA margin  37.8  38.0     
* ADJUSTED EBIT is net income before: (i) other operating revenues / expenses, net; (ii) financial result; and (iii) income tax and social contribution.
** Adjusted EBITDA is net income before: (i) depreciation and amortization expenses; (ii) income tax and social contribution; (iii) financial result; and (iv) other operating revenues / expenses, net.

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

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

 

In 1Q18, net operating revenue, which considers construction revenue, totaled R$ 3,699.6 million, a growth of 4% over the same period of last year.

Costs and expenses, which include construction costs, totaled R$ 2,631.4 million, 3.6% up on 1Q17.

Adjusted EBIT, in the amount of R$ 1,071.0 million, increased 4.9% when compared to the R$ 1,021.4 million reported in 1Q17.

Adjusted EBITDA, in the amount of R$ 1,399.0 million, increased 3.4% when compared to the R$ 1,353.4 million reported in 1Q17 (R$ 5,314.8 million in the last 12 months).

Adjusted EBITDA margin in 1Q18 was 37.8%, against 38.0% in 1Q17 (36.0% in the last 12 months).

Excluding the effects of revenue and construction costs, adjusted EBITDA margin resulted in 45.4% in 1Q18 (47.2% in 1Q17 and 44.9% in the last 12 months).

In 1Q18 the company recorded a net income of R$ 580.4 million, compared to a net income of R$ 674.4   million in 1Q17

Page 2 of 12


 

2.   Gross operating revenue

The gross operating revenue related to the sanitation services, in the amount of R$ 3,280.8 million, which does not consider construction revenue, increased by R$ 251.5 million or 8.3%, when compared to R$ 3,029.3 million in 1Q17.

The main factors that led to this increase were:

 

·         Tariff repositioning index of 7.9% since November 2017; and

·         2.1% increase in total billed volume, 2.1% in water and 2.0% in sewage.

The increase caused by the above-mentioned facts was offset by the recognition of higher estimated losses on wholesale revenue in 1Q18, in the amount of R$ 36.1 million, due to lower payment received in the period, mainly from the municipality of Guarulhos.

 

3. Construction revenue

Construction revenue decreased by R$ 75.7 million or 10.5%, when compared to the previous year. The variation is mainly due to the lower investments in the municipalities served by the Company.


4. Billed volume

 

The tables below show the water and sewage billed volume in quarterly terms, per customer category and region.

WATER AND SEWAGE BILLED VOLUME(1) PER CUSTOMER CATEGORY - million m3
    Water      Sewage    Water + Sewage   
Category  1Q18  1Q17  %  1Q18  1Q17  %  1Q18  1Q17  % 
Residential  406.8  398.9  2.0  346.5  338.1  2.5  753.3  737.0  2.2 
Commercial  42.0  41.5  1.2  40.0  39.5  1.3  82.0  81.0  1.2 
Industrial  7.8  7.8  -  9.7  9.3  4.3  17.5  17.1  2.3 
Public  9.7  9.9  (2.0)  8.7  8.7  -  18.4  18.6  (1.1) 
Total retail  466.3  458.1  1.8  404.9  395.6  2.4  871.2  853.7  2.0 
Wholesale (3)  64.7  61.9  4.5  7.7  9.0  (14.4)  72.4  70.9  2.1 
Total  531.0  520.0  2.1  412.6  404.6  2.0  943.6  924.6  2.1 
 
WATER AND SEWAGE BILLED VOLUME(1) PER REGION - million m3
  Water    Sewage    Water + Sewage   
Region  1Q18  1Q17  %  1Q18  1Q17  %  1Q18  1Q17  % 
Metropolitan  299.7  292.9  2.3  260.7  254.0  2.6  560.4  546.9  2.5 
Regional (2)  166.6  165.2  0.8  144.2  141.6  1.8  310.8  306.8  1.3 
Total retail  466.3  458.1  1.8  404.9  395.6  2.4  871.2  853.7  2.0 
Wholesale (3)  64.7  61.9  4.5  7.7  9.0  (14.4)  72.4  70.9  2.1 
Total  531.0  520.0  2.1  412.6  404.6  2.0  943.6  924.6  2.1 
  
(1) Unaudited
(2) Including coastal and interior region
(3) Reused water volume and non-domestic sewage are included in

 

Page 3 of 12


 


5. Costs, administrative & selling expenses and construction costs

Costs, administrative and selling expenses and construction costs increased by R$ 92.2 million in 1Q18 (3.6%). Excluding construction costs, there was an increase of R$ 166.7 million (9.1%).

As a percentage of net revenue, costs, administrative and selling expenses and construction costs represented 71.1% in 1Q18, against 71.3% in 1Q17.

 
R$ million 
  1Q18  1Q17  Chg. (R$)  % 

Salaries and payroll charges and Pension plan obligations 

630.0  588.4  41.6  7.1 

General supplies 

55.0  36.0  19.0  52.8 

Treatment supplies 

75.9  71.3  4.6  6.5 

Services 

377.1  282.8  94.3  33.3 

Electricity 

221.9  199.7  22.2  11.1 

General expenses 

246.2  209.9  36.3  17.3 

Tax expenses 

16.0  25.8  (9.8)  (38.0) 

Sub-total 

1,622.1  1,413.9  208.2  14.7 

Depreciation and amortization 

328.0  332.0  (4.0)  (1.2) 

Allowance for doubtful accounts 

48.6  86.1  (37.5)  (43.6) 

Sub-total 

376.6  418.1  (41.5)  (9.9) 

Costs, administrative and selling expenses 

1,998.7  1,832.0  166.7  9.1 

Construction costs 

632.7  707.2  (74.5)  (10.5) 

Costs, adm & selling expenses and construction costs 

2,631.4  2,539.2  92.2  3.6 

% of net revenue 

71.1  71.3     

5.1. Salaries and payroll charges and Pension plan obligations

 

In 1Q18, there was an increase of R$ 41.6 million or 7.1%, chiefly due to the following factors:

 

·         Increase of R$ 22.2 million, mainly due to the salary increase of 3.71%, in May 2017 and the application of 1.7% referring to the Carrier and Salary Plan, in February 2018;

·         Increase of R$ 7.4 million in provision referring to TAC (Conduct Adjustment Term) of retirees;

·         Increase of R$ 5.7 million in overtime expenses; and

·         Increase of R$ 4.7 million in health care.

5.2. General Supplies

Increase of R$ 19.0 million or 52.8%, due to the following factors:
 

·         Increase of R$ 8.1 million, resulting from the greater application of materials for maintenance in networks and connections of water and sewage; and

·         Greater application of materials for conservation of properties, furniture and equipment, in the amount of R$ 6.7 million.

Page 4 of 12


 

5.3 Services

Growth of R$ 94.3 million or 33.3%, due to the following factors:
 

·        Higher estimate of expenses, in the amount of R$ 47.5 million, due to an increase in several services contracted in 1Q18, mainly in water and sewage connections and network maintenance;

·         Increase of R$ 15.8 million in advertising campaigns; and

·         Increase in expenses with credit recovery, in the amount of R$ 7.3 million.
 

5.4. Electricity

 

Electricity expenses totaled R$ 221.9 million in 1Q18, an increase of R$ 22.2 million or 11.1% compared to R$ 199.7 million in 1Q17. This variation was mainly due to:

·         Average increase of 0.8% in the free market tariffs (ACL - Ambiente de Contratação Livre), with an increase of 13.4% in consumption;

·         Average reduction of 9.9% in the grid market tariff (TUSD - Tarifas de Uso do Sistema de Distribuição), with a 12.3% increase in consumption; and

·         Average increase of 1.7% in the regulated market tariffs (ACR - Ambiente de Contratação Regulada), with a decrease of 6.9% in consumption.

In 1Q18, the ACL accounted for 36.2% of the total electricity consumed by the Company, TUSD accounted for 35.9% and ACR represented 27.9% of that amount.


5.5. General expenses
 

Increase of R$ 36.3 million or 17.3%, totaling R$ 246.2 million in 1Q18, against R$ 209.9 million in 1Q17, due to the following factors:

  

·         Higher provision for transfer to the Municipal Fund of Environmental Sanitation and Infrastructure, in the amount of R$ 17.2 million, due to the increase in revenue obtained with the municipality of São Paulo;

·         Increase in expenses related to water use, in the amount of R$ 4.9 million; and

·         Greater provisioning for lawsuits in 1Q18, in the amount of R$ 4.1 million.


5.6. Allowance for doubtful accounts

Decrease of R$ 37.5 million, mainly due to higher recovery of unpaid amounts in 1Q18.

Page 5 of 12


 

 


6. Financial result

R$ million 
  1Q18  1Q17  Chg. R$  % 
Financial expenses, net of income  (67.2)  (68.9)  1.7  (2.5) 
Net monetary and exchange variation  (126.7)  72.7  (199.4)  (274.3) 
Financial result  (193.9)  3.8  (197.7)  (5,202.6) 

 

6.1. Financial expenses, net of income

R$ million 
  1Q18  1Q17  Chg. R$  % 
Financial expenses         
Interest and charges on international loans and financing  (78.2)  (64.8)  (13.4)  20.7 
Interest and charges on domestic loans and financing  (36.6)  (22.2)  (14.4)  64.9 
Other financial expenses  (14.9)  (42.1)  27.2  (64.6) 
Total financial expenses  (129.7)  (129.1)  (0.6)  0.5 
Financial income  62.5  60.2  2.3  3.8 
Financial expenses net of income  (67.2)  (68.9)  1.7  (2.5) 

 

Decrease of R$ 1.7 million, mainly due to the following factors:

 

·         Increase of R$ 13.4 million in interest and charges on domestic loans and financing, mainly due to the lower capitalization of interest in works in progress in 1Q18, when compared to the capitalization recorded in 1Q17;

·         Increase of R$ 14.4 million in interest and charges on international loans and financing, mainly due to the appreciation of the US dollar against the real in 1Q18, compared to the devaluation in 1Q17 (0.5% and -2.8% respectively), and higher appreciation of the yen against the real in 1Q18, when compared to the appreciation in 1Q17 (6.3% and 1.9%, respectively); and

·         Decrease of R$ 27.2 million in other financial expenses, largely due to the lower provisioning of interest on lawsuits in 1Q18.

 

6.2. Monetary and exchange variation, net

R$ million 
  1Q18  1Q17  Chg. R$  % 
Monetary variation on loans and financing  (19.6)  (21.8)  2.2  (10.1) 
Currency exchange variation on loans and financing  (112.0)  89.3  (201.3)  (225.4) 
Other monetary variations  (9.7)  (15.5)  5.8  (37.4) 
Monetary/exchange rate variation on liabilities  (141.3)  52.0  (193.3)  (371.7) 
Monetary/exchange rate variation on assets  14.6  20.7  (6.1)  (29.5) 
Monetary/exchange rate variation, net  (126.7)  72.7  (199.4)  (274.3) 

 

The effect on the net monetary/exchange rate variation 1Q18 was R$ 199.4 million higher than in 1Q17, with highlight to the R$ 201.3 million increase in the exchange rate variation on loans and financing, due to the appreciation of the dollar against the real in 1Q18, compared to the devaluation in 1Q17 (0.5% and -2.8%, respectively), and higher appreciation of the yen against the real in 1Q18, when compared to the appreciation registered in 1Q17 (6.3% and 1.9%, respectively).

Page 6 of 12


 


7. Income tax and Social contribution

 

The Company recorded a decrease of R$ 53.2 million, due to the lower taxable result presented in 1Q18, mainly resulting from the appreciation of the US dollar against the real, compared to the devaluation in 1Q17 and the higher appreciation of the yen against the real, when compared to the appreciation registered in 1Q17.

 

8. Indicators

 

8.1. Operating

 

Operating indicators *  1Q18  1Q17  % 
Water connections (1)  8,908  8,703  2.4 
Sewage connections (1)  7,345  7,140  2.9 
Population directly served - water (2)  24.9  24.8  0.4 
Population directly served - sewage (2)  21.6  21.3  1.4 
Number of Employees  13,610  14,086  (3.4) 
Water volume produced in the quarter (3)  702  700  0.3 
IPM - Measured water loss (%)  30.4  31.5  (3.5) 
IPDt (liters/connection x day)  298  308  (3.2) 
  
(1) Total connections, active and inactive, in thousand units at the end of the period
(2) In million inhabitants, at the end of the period. Not including wholesale
(3) In millions of cubic meters
(*) Unaudited

 

 

8.2. Financial

 

Economic Variables at the close of the quarter*  1Q18  1Q17 
Amplified Consumer Price Index (%)(1)  0.70  0.96 
National Consumer Price Index(1)  0.48  0.98 
Consumer Price Index (1)  0.04  0.38 
Referential Rate (1)  0.0000  0.3525 
Interbank Deposit Certificate (%)(2)  6.39  12.13 
US DOLAR (R$)(3)  3.3238  3.1684 
YEN (R$)(3)  0.03126  0.02844 
(1) Year-to-date in %
(2) Last day average
(3) R$/ sell rate previous day price
(*) Unaudited

Page 7 of 12


 


9. Loans and financing

R$ million 
DEBT PROFILE


INSTITUTION


2018


2019


2020


2021


2022


2023

2024
Onwards

Total

Local currency                 
Caixa Econômica Federal  52,063  71,159  73,743  77,573  81,709  73,856  832,949  1,263,052 
Debentures  366,754  1,029,909  579,963  476,635  556,106  359,749  347,850  3,716,966 
BNDES  78,478  117,441  99,282  98,833  98,833  93,145  505,791  1,091,803 
Leasing  13,013  32,900  34,553  36,350  38,304  41,035  369,999  566,154 
Others  1,266  1,373  1,373  1,373  1,373  1,373  2,628  10,759 
Interest and other charges  48,227  11,878  -  -  -  -  -  60,105 
Total Local Currency  559,801  1,264,660  788,914  690,764  776,325  569,158  2,059,217  6,708,839 
Foreign currency                 
IADB  59,111  118,223  118,223  118,223  118,223  118,224  1,061,600  1,711,827 
IBRD  -  10,104  20,208  20,208  20,208  20,209  212,175  303,112 
Deutsche Bank 350  249,285  244,432  -  -  -  -  -  493,717 
Eurobond  -  -  1,161,066  -  -  -  -  1,161,066 
JICA  36,970  122,884  122,884  122,884  122,884  122,884  1,138,558  1,789,948 
IDB 1983AB  79,504  58,806  57,632  25,568  25,568  23,750  -  270,828 
Interest and other charges  43,139  -  -  -  -  -  -  43,139 
Total in foreign currency  468,009  554,449  1,480,013  286,883  286,883  285,067  2,412,333  5,773,637 
Total  1,027,810  1,819,109  2,268,927  977,647 1,063,208  854,225  4,471,550  12,482,476 

 

10. Capex

 

1Q18 investments totaled R$ 689.2 million, including R$ 172.9 million related to the São Lourenço PPP.

 

11. Conference calls

 

In English

May 15, 2018 - Tuesday

01:00 pm  US EST / 02:00 pm  (Brasília)

Dial in: + 1 (412) 317-5486

Conference ID: Sabesp

 

Replay available for 7 days

Dial in: +1 (412) 317-0088

Replay ID: 10116593

 

Click here for the webcast

In Portuguese

May 15, 2018 - Tuesday

9:30 am  US EST / 10:30 am (Brasília)

Dial in: +55 (11) 2188-0155

Conference ID: Sabesp

 

Replay available for 7 days

Dial in: +55 (11) 3127-4999

Replay ID: 43846523

 

Click here for the webcast

Page 8 of 12


 


For more information, please contact:

 

Mario Arruda Sampaio

Head of Capital Markets and Investor Relations

Phone.(55 11) 3388-8664

E-mail: maasampaio@sabesp.com.br

 

Angela Beatriz Airoldi                                                                         

Investor Relations Manager

Phone.(55 11) 3388-8793

E-mail: abairoldi@sabesp.com.br

 

 

 

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

Page 9 of 12


 

    
Income Statement

Brazilian Corporate Law  R$ '000 
  1Q18  1Q17 
Net Operating Income  3,699,668  3,558,825 
Operating Costs  (2,139,237)  (2,061,416) 
Gross Profit  1,560,431  1,497,409 
Operating Expenses     
Selling  (224,155)  (238,680) 
Administrative revenue (expenses)  (267,980)  (239,134) 
Other operating revenue (expenses), net  11,492  10,564 
Operating Income Before Shareholdings  1,079,788  1,030,159 
Equity Result  2,817  1,870 
Earnings Before Financial Results, net  1,082,605  1,032,029 
Financial, net  (81,784)  (85,869) 
Exchange gain (loss), net  (112,149)  89,667 
Earnings before Income Tax and Social Contribution  888,672  1,035,827 
Income Tax and Social Contribution     
Current  (325,870)  (350,440) 
Deferred  17,629  (11,025) 
Net Income for the period  580,431  674,362 
Registered common shares ('000)  683,509  683,509 
Earnings per shares - R$ (per share)  0.85  0.99 
Depreciation and Amortization  (327,899)  (331,948) 
Adjusted EBITDA  1,399,012  1,353,413 
% over net revenue  37.8%  38.0% 

 

Page 10 of 12


 

 

Balance Sheet

Brazilian Corporate Law    R$ '000 
ASSETS  03/31/2018  12/31/2017 
Current assets     
Cash and cash equivalents  2,963,862  2,283,047 
Trade receivables  1,762,793  1,672,595 
Related parties and transactions  166,053  180,773 
Inventories  75,492  85,671 
Restricted cash  14,064  18,822 
Currrent recoverable taxes  190,516  276,585 
Other receivables  167,897  56,592 
Total current assets  5,340,677  4,574,085 
     
Noncurrent assets     
Trade receivables  217,271  215,910 
Related parties and transactions  619,465  634,387 
Escrow deposits  147,646  122,686 
Water National Agency ANA  71,552  70,487 
Other receivables  112,774  113,123 
     
Equity investments  40,404  36,932 
Investment properties  57,640  57,652 
Intangible assets  33,830,713  33,466,132 
Property, plant and equipment  247,472  255,050 
Total noncurrent assets  35,344,937  34,972,359 
     
Total assets  40,685,614  39,546,444 
     
LIABILITIES AND EQUITY  03/31/2018  12/31/2017 
Current liabilities     
Trade payables  310,685  344,947 
Borrowings and financing  1,876,775  1,746,755 
Accrued payroll and related charges  633,146  588,073 
Taxes and contributions  126,977  183,965 
Dividends and interest on capital payable  598,612  598,612 
Provisions  584,948  607,959 
Services payable  515,852  408,275 
Public-Private Partnership PPP  76,151  60,007 
Program Contract Commitments  138,591  128,802 
Other liabilities  106,988  104,485 
Total current liabilities  4,968,725  4,771,880 
     
Noncurrent liabilities     
Borrowings and financing  10,605,701  10,354,211 
Deferred income tax and social contribution  19,125  36,754 
Deferred Cofins and Pasep  128,769  130,182 
Provisions  449,172  470,245 
Pension obligations  2,939,958  2,932,338 
Public-Private Partnership PPP  3,155,812  3,011,409 
Program Contract Commitments  105,201  110,698 
Other liabilities  219,711  215,718 
Total noncurrent liabilities  17,623,449  17,261,555 
     
Total liabilities  22,592,174  22,033,435 
     
Equity     
Paid-up capital  10,000,000  10,000,000 
Profit reserve  8,051,110  8,051,110 
Other comprehensive income  (538,101)  (538,101) 
Retained earnings  580,431  - 
Total equity  18,093,440  17,513,009 
     
Total equity and liabilities  40,685,614  39,546,444 

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Cash Flow

Brazilian Corporate Law    R$ '000 
  Jan-Mar  Jan-Mar 
  2018  2017 
Cash flow from operating activities     
Profit before income tax and social contribution  888,672  1,035,827 
Adjustment for:     
Depreciation and amortization  327,899  331,948 
Residual value of property, plant and equipment and intangible assets written-off  4,282  11,314 
Allowance for doubtful accounts  48,631  86,136 
Provision and inflation adjustment  36,513  62,657 
Interest calculated on loans and financing payable  119,242  90,640 
Inflation adjustment and foreign exchange gains (losses) on loans and financing  131,664  (67,648) 
Interest and inflation adjustment losses  8,099  2,950 
Interest and inflation adjustment gains  (3,929)  (10,569) 
Financial charges from customers  (60,324)  (60,716) 
Margin on intangible assets arising from concession  (14,551)  (15,699) 
Provision for Consent Decree (TAC)  7,387  2,314 
Equity result  (2,817)  (1,870) 
Provision from São Paulo agreement  -  104,360 
Pension obligations  59,948  77,268 
Other adjustments  6,303  (12,295) 
  1,557,019  1,636,617 
Changes in assets     
Trade accounts receivable  (77,646)  (49,660) 
Accounts receivable from related parties  28,282  16,050 
Inventories  10,179  (6,047) 
Recoverable taxes  86,069  28,438 
Escrow deposits  (21,891)  16,047 
Other accounts receivable  (112,021)  (71,154) 
Changes in liabilities     
Trade payables and contractors  (244,286)  (29,084) 
Services payable  107,577  (127,199) 
Accrued payroll and related charges  37,686  (5,959) 
Taxes and contributions payable  (160,978)  (78,771) 
Deferred Cofins/Pasep  (1,413)  (300) 
Provisions  (80,597)  (49,923) 
Pension obligations  (52,328)  (54,489) 
Other liabilities  4,304  24,542 
 
Cash generated from operations  1,079,956  1,249,108 
 
Interest paid  (196,060)  (213,824) 
Income tax and contribution paid  (221,880)  (271,672) 
 
Net cash generated from operating activities  662,016  763,612 
 
Cash flows from investing activities     
Acquisition of intangibles  (229,976)  (520,886) 
Restricted cash  4,758  2,079 
Purchases of tangible assets  (2,786)  (10,601) 
  (655)  - 
Net cash used in investing activities  (228,659)  (529,408) 
 
Cash flow from financing activities     
Loans and financing     

Proceeds from loans 

943,048  275,208 

Repayments of loans 

(681,698)  (403,698) 
Public-Private Partnership PPP  (13,892)  (7,741) 
Program Contract Commitments  -  (372) 
Net cash generated by (used in) financing activities  247,458  (136,603) 
 
Cash reduce and cash equivalents  680,815  97,601 
 
Represented by:     
Cash and cash equivalents at beginning of the year  2,283,047  1,886,221 
Cash and cash equivalents at end of the year  2,963,862  1,983,822 
Cash reduce and cash equivalents  680,815  97,601 

Page 12 of 12


SIGNATURE  
 
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, in the city São Paulo, Brazil.
Date: May 11, 2018
 
Companhia de Saneamento Básico do Estado de São Paulo - SABESP
By: /s/  Rui de Britto Álvares Affonso    
 
Name: Rui de Britto Álvares Affonso
Title: Chief Financial Officer and Investor Relations Officer
 

 

 
FORWARD-LOOKING STATEMENTS

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