(02/12/2016) Paranapanema, Brazil’s largest copper producer, reported net income of R$ 5.4 billion in 2015, a 14% increase compared to 2014. The result is the result of the strategy to direct more volume to the foreign market, offsetting the slowdown in Brazilian demand. Of total revenues in 2015, 42% came from the domestic market and 58% of the export market.

The company’s strategy of direct sales to foreign markets contributed to the increase in sales volume (6%), which totaled 282,000 tons. The company’s net profit grew 9%, closing at R$ 134.8 million, retained earnings of R $ 96.7 million, after deduction of legal reserves and offset past losses, whose allocation will be made according to applicable legislation and will be subject to Annual General Meeting (AGM) of the Company scheduled for April 2016.

Return on Invested Capital (ROIC) was 10.4% in 2015 from 9.9% the previous year, consolidating the third year of consistent growth coupled with disciplined and efficient use of capital. EBITDA Adjusted Company was R$ 360.2 million, slightly higher than 2014, with a margin of Adjusted EBITDA of 6.7%.

“Even in a year of strong economic downturn in the domestic market, Paranapanema has achieved solid and stable results. We believe that 2016 will be a new challenging period and therefore we will continue the strategies that have been successful in the last year: keep the commercial efforts in the overseas market to ensure the volumes and also work on the higher value-added products, ensure strong discipline in the management costs and maintain the investment program to the level necessary for operating performance, “said the president of copper producer, Christophe Malik Akli.

During the year 2015, Paranapanema invested R$ 256 million in capital equipment and maintenance of industrial operations. About 60% of the resources, R$ 153 million, was allocated to unit of Dias d’Ávila, in Bahia. Among the main projects were the modernization of Sulfuric Acid Unit (UAS) and the installation of new equipment to increase yarn production, whose capacity has jumped from 50,000 tons to 80,000 tons. In Santo André unit, the main investment was the new line of straight tubes, transferred from the unit off Capuava for Utinga plant and modernized, allowing you to double the straight pipe production capacity to 1,000 tons/month.

OUTLOOK – For 2016, the company estimates investments of R$ 156 million directed to maintenance of operating assets, in line with the strategy of the company’s management plan, the PMA 2018 of maximizing capacity utilization. With results pressured by lower Brazilian demand and inflation costs in reais, the company focused on is the maintenance and growth of liquidity and their volumes, destined mainly to the export market, which will also be pressured by changes in the pace of the Chinese economy growth, the largest global consumer of copper.

Just as in 2015, Paranapanema pay special attention to the management of liquidity and credit to domestic customers, using the necessary tools for cash management and the reduction of working capital items. Also priority will be the sale of non-operating assets, as the site of the former Capuava factory, and the lengthening of bank liabilities available – in 2015, the Company reached 51% of long-term debt, compared to 44% of Q3 2015 closing (considering the total of the company’s debts).