Companhia Mineira de Açúcar e Álcool Participações MINEIRA DE AÇÚCAR E ÁLCOOL PARTICIPAÇÕES HARVEST 14/15 – 2Q15 Management Report Uberaba, November 14th 2014. Dear Shareholders,

Companhia Mineira de Açúcar e Álcool Participações

Management Report - Harvest 14/15 – 2º Quarterly 2Q15

COMPANHIA MINEIRA DE AÇÚCAR E ÁLCOOL

PARTICIPAÇÕES HARVEST 14/15 – 2Q15

Management Report

Uberaba, November 14th 2014.

Dear Shareholders,

We present the Management Report, the Financial Statements and Independent Auditors' Report for

the first quarterly of harvest 2014/2015, ended on September 30th, 2014 in accordance with CPCs and IFRS..

It was crushed 1,498 K Tons of sugarcane in 2Q15, increased 7.9% if compared with previous

crop. YTD of September was 2,781 k Tons, 18.5% higher than last harvest..

On second quarterly of current harvest were produced: 112 k Tons of sugar, 59 K m³ of

ethanol and 105 k MWH of energy. YTD up to September, the production of VHP was 17.2% higher than last

crop (170 ktons), +7.7% of ethanol (112 k m³) and +29% of energy (193k MWH).

Gross Sales of 2Q15 was 166 MR$, +17% than 2Q14. On this first 6 months of current crop

was billed 249.8 MR$, 17.3% higher than last crop.

EBITDA was 48.7 MR$ in 2Q15, increased of 15.8%. YTD up to September was 82.4 MR$,

55.9% higher than last crop.

Increase of 10.7% at net income in 2Q15 (19.6 MR$). YTD this crop increased 59.1% if

compared same period than previous crop.

Features of Harvest 14/15 – 2Q15



Note: EBITDA: Net sales (-) COGS (-) SG&A (+)Depreciation and Plating amortization allocated in product cost. Ratoon cane treatment

is considered in cost, therefore don´t sum to compose EBITDA.

Operational & Financial Features

(THOUSAND REAIS) 2Q14 2Q15 Var.(%) 6M14 6M15 Var.(%)

CMAA - CONSOLIDATED

Gross Sales 141.750 165.914 17,0% 213.002 249.820 17,3%

Net Sales 136.786 161.030 17,7% 202.238 238.674 18,0%

COGS -88.513 -106.744 20,6% -145.045 -160.501 10,7%

SG&A -13.859 -17.184 24,0% -22.611 -27.176 20,2%

Depreciation and Planting Amortizantion 7.655 11.635 52,0% 18.291 31.445 71,9%

EBITDA 42.069 48.737 15,8% 52.873 82.442 55,9%

EBITDA Margin 30,8% 30,3% -1,6% 26,1% 34,5% 32,2%

Net Income 17.698 19.591 10,7% 9.001 14.322 59,1%

Operational Data 2Q14 2Q15 Var.(%) 6M14 6M15 Var.(%)

CMAA - CONSOLIDATED 2T14 2T15 Var.(%) 6M14 6M15 Var.(%)

Crushing Sugar Cane (Thousand Tons) 1.388 1.498 7,9% 2.347 2.781 18,5%

Owner 295 486 64,7% 781 1.042 33,4%

Third Parties 1.093 1.012 -7,4% 1.566 1.739 11,1%

Mechanized Harvesting 100% 100% 0,0% 100% 100% 0,0%

TRS (Kg/ton of cane) 142,3 139,7 -1,8% 133,4 127,6 -4,3%

Production

Sugar (Thousand Tons) 94 112 19,1% 145 170 17,2%

Anhydrous Ethanol (Thousand m³) 43 44 3,5% 60 77 27,0%

Hydrous Ethanol (Thousand m³) 22 15 -32,8% 44 35 -20,5%

Electric Energy (Thousand Mwh) 92 105 14,1% 150 193 29,0%

Sales


Anhydrous Ethanol (Thousand m³) 20 20 -1,7% 37 38 4,0%

Hydrous Ethanol (Thousand m³) 20 15 -26,6% 37 30 -19,7%

Electric Energy (Thousand Mwh) 92 103 12,0% 150 190 26,5%

Inventory


Anhydrous Ethanol (Thousand m³) 27 43 59,9% 26,6 42,6 59,9%

Hydrous Ethanol (Thousand m³) 7 4,8 -35,7% 7,4 4,8 -35,7%



Sugar VHP – NYBOT #11: The VHP, the screen # 11 of the New York Stock Exchange, began the period 2Q15

with prices higher than 2Q14, but the price dropped and ended the second quarterly of the current crop

below 8.24% of the price on 30/09/13. The average 2Q14 was 16.69 cts/lb while the average 2Q15 was 15,93

cts/lb. The average price of the VHP in the quarterly in R$ / ton was R $ 798.80 (whereas average PTAX dollar),

5.1% lower than the same period of last season, which was R$ 841.87 / ton.

2Q14 2Q15 Var.(%) 6M14 6M15 Var.(%)

Sugar Cane* 259,45 238,54 -8,1% 440,43 441,54 0,3%

TRS (kg/Sugar cane tons) 133,08 145,11 9,0% 123,26 135,62 10,0%

Sugar* 16,31 14,74 -9,7% 25,20 25,08 -0,5%

Ethanol** 11,22 11,22 0,0% 18,83 19,68 4,5%

Anhydrous 5,10 4,80 -5,8% 8,07 8,39 4,0%

Hydrous 6,12 6,42 4,9% 10,76 11,29 4,9%

Sugar (%) 45,15 44,65 -1,1% 45,15 43,95 -2,7%

Ethanol (%) 54,85 55,35 0,9% 54,85 56,05 2,2%

Source: FCSTONE/ÚNICA

*mil l ion tons

**bi l l i on de l i ters

Prices – 2Q15

According last data from ÚNICA, the

production of Mid-South of Brazil at

2Q15 crushed 239 million tons, 8.1%

lower than last crop



Hydrous Ethanol: the hydrous ethanol price was higher than average historical price and higher than maximum price of last 3 years. The ESALQ average price in 2Q15 was R$ 1,215/m³ while last harvest was R$ 1,116/m³, 8.87% higher.

Anhydrous Ethanol: the price of Anhydrous Ethanol started the second quarterly slightly higher the historical average of the last 3 years. The ESALQ average price in 2Q15 was R$ 1,345 / m³ while in 2Q14 was R$ 1,273 / m³, 5.66% higher.



Demand: The chart above shows a small reduction in fuel demand in the Mid-South in the second quarterly of the current crop, compared to the same period of the previous harvest. The price line shows an increase of 7.83% if compared 2Q15 and 2Q14.

Revenues

GROSS SALES COMPOSITION 2Q14 2Q15 Var.(%) 6M14 6M15 Var.(%)

In Thousand Reais 2T14 2T15 Var.(%) 6M14 6M15 Var.(%)

Internal Market 70.004 84.712 21,0% 124.456 157.418 26,5%

Hydrous Ethanol 24.803 20.021 -19,3% 47.245 41.399 -12,4%

Anhydrous Ethanol 26.342 27.834 5,7% 48.973 53.868 10,0%

Sugar 0 0 0,0% 0 0 0,0%

Electric Energy 16.151 36.605 126,6% 25.531 61.543 141,1%

Others 2.708 252 -90,7% 2.707 608 -77,5%

External Market 71.746 81.202 13,2% 88.546 92.402 4,4%

Sugar 71.746 81.202 13,2% 88.546 92.402 4,4%

Hydrous Ethanol 0 0 0,0% 0 0 0,0%

Total Gross Sales 141.750 165.914 17,0% 213.002 249.820 17,3%

Hydrous Ethanol 24.803 20.021 -19,3% 47.245 41.399 -12,4%

Anhydrous Ethanol 26.342 27.834 5,7% 48.973 53.868 10,0%

Sugar 71.746 81.202 13,2% 88.546 92.402 4,4%

Electric Energy 16.151 36.605 126,6% 25.531 61.543 141,1%

Others 2.708 252 -90,7% 2.707 608 -77,5%



Sugar VHP

Volume (Thousand tons) e Average Price (R$/ton)

In the second quarterly of the crop

14/15 were sold 89 k tons of sugar,

15.58% more than the previous harvest at

an average price of R$ 915/ton, lower 2%

from 2Q14. The YTD of harvest was sold

3% more sugar with an average price

higher 1.43% than last crop.



Ethanol

Hydrous: were sold 15 thousand

m³ at 2Q15, 26% lower than 2Q15, with

average price of R$ 1.38/liter,

increased 10.4% if compared second

quarterly of harvest 13/14.

Anhydrous: At 2Q15 were sold 20

thousand m³, same volume than 2Q14, with

average price of R$ 1.40/m³, increased 7.7% if

compared same period than last crop.

The Cost of goods sold has the second quarterly of the harvest 14/15 an increase of 20.7% in absolute

values over the same period of the crop 13/14. This increase is due to the increase of 3% in TRS volumes sold; purchase biomass for power generation and 12% increase in sales volumes of energy. When comparing the unit cost of sugar / ethanol on the TRS sold, there is an increase of 20.3%, reflecting the lower TRS per ton of cane.

Cost



Sales: At 2Q15 increased 36.5% than 2Q14. The variation is due increase of 15.5% in VHP volumes

transported to port and increase of 18% in freight prices.

Administrative: Decrease of 1.3% on administrative expenses if compared second quarterly of harvest

15/16 to second quarterly of last crop.

Expenses

COGS 2Q14 2Q15 Var.(%) 6M14 6M15 Var.(%)


Sugar 41.761 62.071 48,6% 56.154 70.633 25,8%

Ethanol 38.062 36.801 -3,3% 76.614 76.953 0,4%

Electric Energy 4.055 7.927 95,5% 7.468 12.897 72,7%

Others 4.635 -55 -101,2% 4.809 18 -99,6%

Total COGS 88.513 106.744 20,6% 145.045 160.501 10,7%

TRS Sold (Thousand Tons) 141 145 3,0% 213 207 -2,6%

Unit Cost (Sugar&Ethanol COGS/TRS) 566 681 20,3% 625 713 14,1%

Sales Expenses 2Q14 2Q15 Var.(%) 6M14 6M15 Var.(%)

In Thousand Reais

Freight of transfers and sales 7.050 9.589 36,0% 11.567 15.119 30,7%

Port Charges 2.149 2.520 17,3% 2.683 2.844 6,0%

Comissions and Sales fees 18 328 1771,0% 358 677 89,1%

Personnel expenses 161 261 62,2% 314 459 46,0%

Depreciation 235 237 0,9% 472 472 0,1%

Rent 6 0 -95,5% 27 0 -98,8%

Others Expenses 68 286 318,9% 178 569 219,0%

Total 9.687 13.221 36,5% 15.599 20.140 29,1%

Administrative Expenses 2Q14 2Q15 Var.(%) 6M14 6M15 Var.(%)

In Thousand Reais

Personnel expenses 2.217 2.253 1,7% 4.145 4.509 8,8%

General expenses and Outsourced Services 1.342 1.243 -7,3% 2.633 2.308 -12,3%

Depreciation 233 249 6,8% 445 482 8,3%

Tax, fees and contribuitions 42 38 -8,9% 149 81 -45,7%

Rent 27 29 7,5% 93 53 -43,3%

Total 3.861 3.812 -1,3% 7.465 7.433 -0,4%



The second quarterly of season 14/15, had 18.2 MR$ of net financial results, being: 7.5 MR$ of short

term interest and 8.7 MR$ of long term interest. The interest exchange variation was -1.5MR$, being -1.5 MR$

of settled contracts and +38 kR$ of maturing contracts. Other financial income and expenses are composed of

bank charges, commissions and IOF financial operations.

Financial Results

FINANCIAL RESULTS BREAKDOWN 2Q15

In Thousand Reais

Interest of Short Term debt 7.490-

Interest of Long Term debt 8.771-

Exchange Variation 1.575-

Income of Investment 587

Others financial income/expenses 935-

Total -18.184

EXCHANGE VARIATION - 2Q15 ACC SWAP/NDF Outros Total

Settled Contracts 8- 1.608- 80 1.537-

Fair Value of interest in active contracts 210- 171 - 38-

Total 218- 1.437- 80 1.575-

Net Financial Results 2Q14 2Q15 Var.(%) 6M14 6M15 Var.(%)

In Thousand Reais

Financial incomes 1.589 1.761 10,8% 1.259 3.314 163,2%

Financial Expenses -18.165 -19.945 9,8% -33.734 -37.800 12,1%

Total -16.576 -18.184 9,7% -32.475 -34.486 6,2%



The position of assets and liabilities on September 30th 2014 demonstrates a positive variation in the

asset account for the largest volume in stocks. In liabilities, the negative variation was reflected of reduction

of supplier to be paid.

The net debt position na index of net indebtedness to capital social + reserves increased 15.7% relative

March 31st 2014. This increase is reflection of increase USD, that updated the amount of debt in USD and

higher level of inventory of finished product (VHP) due lack of vessel to shipment, resulting less money in

cash.

INDEBTEDNESS 31/3/14 30/9/14 Var.(%)

In Thousand Reais

ACC 101.111 191.014 88,9%

FINAME 212.158 203.094 -4,3%

Working Capital 187.096 173.789 -7,1%

Debentures 120.923 120.934 0,0%

Diferred Expenses -3.619 -3.919 8,3%

Gross Indebtedness 617.669 684.912 10,9%

Cash 60.264 26.652 -55,8%

Net Indebtedness 557.405 658.260 18,1%

Social Capital + Reserves 203.364 207.528 2,0%

Index (Net Indebtedness/Social Capital) 2,74 3,17 15,7%

Indebtedness

Operational Working Capital

OPERATION WORKING CAPITAL 31/3/14 30/9/14 Var.(%)

In Thousand Reais

ASSETS 86.502 203.999 135,8%

Receivables 31.253 35.694 14,2%

Inventory 39.747 156.532 293,8%

Recoverable Taxes 15.502 11.773 -24,1%

LIABILITIES 98.104 89.539 -8,7%

Suppliers 77.724 61.641 -20,7%

Salaries and Social Security Contribuitions 16.106 20.620 28,0%

Payables Taxes 4.274 7.278 70,3%

WORKING CAPITAL -11.602 114.460 1086,6%



The largest investments of the second quarter of the crop 14-15 were in formation of new sugar cane

fields and agricultural equipment to meet the expectation of crushing the coming seasons.

The statements contained herein relating to the prospects of the business, estimates for operating,

financial and investments results are based on management's expectations and these depend substantially on changes in market conditions, the performance of the Brazilian economy and international markets and therefore are subject to change without notice.

Non-financial information, as well as other operating information has not been reviewed by the independent auditors.

Opinions of Directors on the Quarterly information’s – 2Q15

The Directors declare that reviewed, discussed and agreed with the quarterly Information – 2Q15 and also with the conclusions expressed in the report of the independent auditors, in accordance with Article 25 of CVM Instruction 480/09.

CVM Instruction 381/03 In accordance with CVM Instruction No. 381, the Company announced that its independent auditors,

KPMG, have not provided during last six months of 2014, ended September 30th 2014, others services than those related to external audit.

The Company's policy on hiring of others services than external audit ensures that there is no conflict

of interest or loss of independence of auditor.

Legal Notice

Investments

CMAA - CONSOLIDATED 2Q14 2Q15 Var.(%) 6M14 6M15 Var.(%)


Sugar Cane Planting 8.381 5.591 -33,3% 18.329 16.146 -11,9%

Agricultural Machinary and Building 877 4.047 361,7% 7.649 13.514 76,7%

Industrial Equipments and Building 813 1.796 120,9% 6.108 9.755 59,7%

Administrative equipments/System and Others 17 345 1898,1% 1.159 1.392 20,1%

Total 10.088 11.779 16,8% 33.245 40.807 22,7%



The CMAA is a public company registered with the CVM and was created to be a hub for three mills of

ethanol, sugar and energy, crushing a total of 12.9 million tons per year. It is located in a region close to major consumption centers (in Triângulo Mineiro). Currently operation is unit Usina Vale do Tijuco, in Uberaba(MG), which was designed with total processing capacity of 4 Million Tons of sugarcane and export up to 210 MW. This plant started its first season in April 2010 with a crushing of 1.2 million tons, with the second season in 2011, with a grinding of 1.66 million tons of sugarcane, already producing VHP, anhydrous & hydrous ethanol and electric energy. For the season 2012/2013 was crushed 2.2 million tons and for harvest 2013/14 crushed

3 million tons of sugarcane. The prevision of harvest 14/15 is crushing 3.5 million tons of sugarcane.

About CMAA Group



CMAA - Companhia Mineira de Açúcar e Álcool Participações

Statements of results of 6-month periods ended September 30th of 2014 & 2013

(In thousands of Reais)

30/09/2014 30/09/2013(6 months) (6 months)

Net revenue 238.674 202.238 Variation of the biological asset's fair value (788) 5.188 Cost of sales and services (160.501) (145.045)

Gross profit 77.385 62.381

Sales expenses (20.140) (15.599) General expenses (7.433) (7.465) Other income 398 453

Share of loss of equity-accounted investees 0 -

(27.176) (22.611)

Result before net financial income and expenses and taxes 50.209 39.770

Financial expenses (37.801) (33.734) Financial income 3.314 1.259

Net financial income (expenses) (34.486) (32.475)

Loss before taxes 15.723 7.295

Current income and social contribution taxes (2.469) (6) Deferred income and social contribution taxes 1.069 1.712

(1.400) 1.706

Profit/(Losses) for the period 14.322 9.001

Consolidated




Balance sheets at July 30, 2014 and 2013


Assets Note 30/09/2014 31/03/2014

Cash and cash equivalents 6 26.652 60.562 Trade and other receivables 7 35.694 31.253 Inventories 8 156.532 39.747 Loan receivable from suppliers - - Recoverable taxes and contributions 9 11.773 15.502 Other current assets 2.004 1.634

Total current assets 232.655 148.698

Long-term assetsInventories 8 9.254 8.377 Trade and other receivables 7 - - Judicial deposits 695 410 Derivative financial instruments 24 - - Related party credits 7 - - Recoverable taxes and contributions 9 31.655 30.109 Deferred taxes liabilities 17 9.073 347

Investments 11 2 2 Biological assets 10 164.256 178.410 Property, plant and equipment 12 457.502 476.776 Intangible assets 4.630 3.381

Total non-current assets 677.067 697.812

Total assets 909.722 846.510

Consolidated




Balance sheets at July 30, 2014 and 2013


Liabilities Note 30/09/2014 31/03/2014

Loans and borrowings 14 317.730 242.319 Debêntures 67.494 27.404 Suppliers and other accounts payable 13 61.641 77.724 Provision and labor charges 20.620 16.106 Tax liabilities 7.278 4.274 Advances from clients 3.242 260 Other current liabilities 1.344 2.441

Total current liabilities 479.349 370.528

Trade and other payables 13 - - Loans and borrowings 14 246.247 254.427 Debêntures 53.440 93.519 Debts with related parties 14 - - Derivative financial instruments 24 10.382 6.909 Provision for loss in investments 11 - - Deferred taxes liabilities 17 - - Provisions for contingencies 15 914 1.208

Total non-current liabilities 310.983 356.063 Equity 18

Share capital 203.364 203.364 Capital reserve 4.164 4.164 Equity evaluation adjustment (20.644) (5.791) Accumulated losses (67.494) (81.818)

Total shareholders' equity 119.390 119.919

Total liabilities 790.332 726.591

Total liabilities and shareholders' equity 909.722 846.510

Consolidated



Kind Regards,

Chairman Industrial Director

Carlos Eduardo T. Santos Celso Oliveira

CFO Agricultural Director

Sylvio Ortega Filho Eduardo Scandiuzzi

Accountant

Anderson Cesar Augusto Alves

KPDS 100700


Report on the review of quarterly information - ITR

quarter ended September 30, 2014


Report on the review of quarterly information - ITR quarter ended

September 30, 2014

2

Contents Report on the review of quarterly information - ITR 3 Balance sheets 5 Statements of income 6 Statements of comprehensive income 7 Statements of changes in shareholders' equity 8 Statements of cash flows – Indirect method 9 Statements of added value 10 Notes to the quarterly financial information 11

3

Report on the review of quarterly information - ITR To the Board Members and Shareholders of Companhia Mineira de Açúcar e Álcool Participações Uberaba - Minas Gerais Introduction We have reviewed the interim, individual and consolidated financial information of Company, contained in the Quarterly Information – ITR Form for the quarter ended September 30, 2014, which comprise the balance sheet as of September 30, 2014 and related statements of income, of comprehensive income for the three and six-month periods then ended, of changes in shareholders' equity and of cash flows for the six-month period then ended, including the explanatory notes. The Company's Management is responsible for the preparation of the individual interim accounting information in accordance with Technical Pronouncement CPC 21 (RI) - Interim Statement and of the consolidated interim accounting information in accordance with CPC 21 (R1) and with international standard IAS 34 - Interim Financial Reporting, issued by the International Accounting Standards Board - IASB, as well as for the presentation of this information in a manner consistent with the standards issued by the Brazilian Securities and Exchange Commission, applicable to the preparation of the Quarterly Information - ITR. Our responsibility is to express a conclusion on this interim financial information based on our review. Scope of the review We conducted our review in accordance with the Brazilian and international review standards for interim information (NBC TR 2410 - Review of Interim Financial Information Performed by the Independent Auditor of the Entity and ISRE 2410 - Review of Interim Financial Information Performed by the Independent Auditor of the Entity, respectively). A review of interim information consists in asking questions, chiefly to the persons in charge of financial and accounting affairs, and in applying analytical procedures and other review procedures. A review is substantially less in scope than an audit conducted in accordance with Brazilian and International Standards on Auditing and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.

4

Conclusion on the individual interim information Based on our review, we are not aware of any facts that would lead us to believe that the individual interim accounting information included in the quarterly information referred to above was not prepared, in all material respects, in accordance with CPC 21 (R1) applicable to the preparation of Quarterly Information - ITR, and presented in a manner consistent with the standards issued by the Brazilian Securities and Exchange Commission. Conclusion on the consolidated interim information Based on our review, we are not aware of any facts that would lead us to believe that the consolidated interim accounting information included in the quarterly information referred to above was not prepared, in all material respects, in accordance with CPC 21 (R1) and IAS 34 applicable to the preparation of Quarterly Information - ITR, and presented in a manner consistent with the standards issued by the Brazilian Securities and Exchange Commission. Emphasis Going concern Without qualifying our opinion, we call your attention to note 1 to the financial quarterly information, which indicates that on that date, the Company’s consolidated current liabilities exceeded the total current assets by R$ 251,472 thousand. These conditions, together with other matters, as described in Note 1, indicate that a significant uncertainty exists and may raise significant doubts on the Company's capacity of continuing as a going concern. Other issues Statements of added value We also reviewed the individual and consolidated statements of added value (SAV) for the six-month period ended on September 30, 2014, prepared by the Company's management, whose presentation in the interim information is required according to the standards issued by the CVM – Brazilian Securities and Exchange Commission, applicable to the preparation of Quarterly Information - ITR and considered supplementary information by the IFRS, which do not require the presentation of the SAV. These statements were subjected to the review procedures previously described and, based on our review, we are not aware of any other event that make us believe that those were not prepared, in all material respects, in accordance with the individual and consolidated interim accounting information taken as a whole. São Carlos, November 05, 2014. KPMG Auditores Independentes CRC SP-014428/O-6 F-MG André Luiz Monaretti Accountant CRC 1SP160909/O-3

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30

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(In

thou

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rea

is)

Not

e09

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09/3

0/20

1309

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0/20

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13(3

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(3 m

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(6 m

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(3 m

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(6 m

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Net

op

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inco

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20

16

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13

6.7

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23

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Gro

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com

e5

7.4

75

4

7.7

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7

7.3

85

6

2.3

81

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Sal

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xpen

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21

(13

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(9.6

87

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(20

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-

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Ad

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21

(3.8

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(3.8

61

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(7.4

33

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(7.4

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(19

9)

(24

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(36

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5)

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(14

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10

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Fin

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(24

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(37

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anci

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1

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9

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(1

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(4

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22

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9

17

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15

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18

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33

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17

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19

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Thr

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end

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, 2014

and

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(In

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rea

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1409

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0/20

1409

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09/3

0/20

140

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309

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13(3

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(3 m

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(6 m

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(3 m

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19

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tem

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e

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ance

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il 1,

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319

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4.

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(9

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6.40

7

Oth

er c

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Net

inco

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perio

d -

-

-

9.

001

9.

001

203.

364

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(1

4.47

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(8

1.36

8)

11

1.68

1

B

alan

ces

at S

epte

mbe

r 30

, 201

3

Bal

ance

s at

Apr

il 1,

201

420

3.36

4

4.

164

(5

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)

(81.

818)

119.

919

Oth

er c

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me:

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es fr

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ash

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(1

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N

et in

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r th

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riod

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14.3

22

14.3

22

Bal

ance

s at

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tem

ber

30, 2

014

203.

364

4.16

4

(2

0.64

4)

(6

7.49

6)

11

9.38

8

See

the

acco

mpa

nyin

g no

tes

to th

e qu

arte

rly in

form

atio

n.

Cap

ital

Cap

ital r

eser

ve

Equ

ity

eval

uatio

n ad

just

men

tA

ccum

ulat

ed

loss

es

Tot

al

shar

ehol

ders

' eq

uity


Statement of cash flows – Indirect method

Six-month period ended September 30, 2014 and 2013

(In thousands of reais)

Note

09/30/2014 09/30/2013 09/30/2014 09/30/2013(6 months) (6 months) (6 months) (6 months)

Cash flow from operating activitiesIncome for the period 14.322 9.001 14.322 9.001 Adjustments to reconcile income (loss):Change in fair value of biological assets 788 (5.188) - - Depreciation and amortization 18.463 11.043 - - Decrease in biological assets for the crop of sugarcane 28.240 10.420 - - Off-season amortization 29.022 24.108 - - Amortization of cultural treatments of ratoon cane 16.718 Equity in income of subsidiaries - - (14.929) (9.855) Residual value of written-off fixed assets 4.722 3.060 - - Interest on loans and financing 31.622 26.959 - - Unrealized foreign exchange variation on loans and financing 13.381 - Monetary variation on loans receivable from supplier 32 (56) - - Unrealized losses on derivative financial instruments (3.473) 957 - - Formation (reversal) of allowance for doubtful accounts - (29) - - Formation (reversal) of provision for contingencies 294 10 - - Formation (reversal) of provision for realization of inventories - - - - Deferred income and social contribution taxes (1.069) (1.712) - -

153.062 78.573 (607) (854)

Increase in trade receivable and other receivables (4.441) (22.111) - - Increase in Inventories (117.662) (63.400) - - Decrease in loan receivable from supplier - 1.743 - - Decrease/(increase) in taxes and contributions recoverable (5.469) 8.949 - 14 Decrease/(increase) in other current assets (659) 1.048 5 2 Decrease/(increase) in suppliers and other accounts payable (16.083) 6.783 200 (81) Increase in provision and labor charges 4.514 4.360 - - Increase in tax liabilities 535 423 252 382 Increase in advances from clients 2.982 11.007 - - Decrease/(increase) in other current liabilities (1.095) (53) 1 6

Cash (used in) from operating activities 15.684 27.322 (149) (531)

Payment of interest on loans and financing (33.350) (28.203) - -

Net cash used in operating activities (17.666) (881) (149) (531)

Cash flow from investment activitiesFormation of biological assets (31.592) (18.320) - - Acquisition of fixed assets 28.b (21.759) (9.032) - - Acquisition of intangible assets (1.814) (641) (328) - Credit granting to related parties - - 39.274 (23.321)

Net cash (used in) from investment activities (55.165) (27.993) 38.946 (23.321)

Cash flow from financing activitiesLoans and financing 199.558 191.604 - - Payment of principal of loans and financing (160.637) (172.875) - - Funding with related parties - - (38.800) 23.846

Net cash (used in) from financing activities 38.921 18.729 (38.800) 23.846

Decrease in balance of cash and cash equivalents (33.910) (10.145) (3) (6)

Statement of cash and cash equivalentsCash and cash equivalents at April 1 60.562 19.774 116 117 Cash and cash equivalents at September 30 28.a 26.652 9.629 113 111

(33.910) (10.145) (3) (6)

See the accompanying notes to the quarterly information.

- - - -

Consolidated Parent company


Statements of added value

Six-month period ended September 30, 2013 and 2012

(In thousands of reais)

09/30/2014 09/30/2013 09/30/2014 09/30/2013(6 months) (6 months) (6 months) (6 months)

IncomeSale of merchandise, products and services 249.820 213.002 - - Other income 2.011 1.141 - - Allowance for doubtful accounts - 29 - -

251.831 214.172 - -

Inputs acquired from third parties (including PIS and COFINS)Cost of products, goods, and services sold (79.778) (63.220) - - Materials, energy, outsourced services and other (36.612) (40.407) (307) (426) Others (12.195) (10.898) - (1)

(128.585) (114.525) (307) (427)

Gross added value 123.246 99.647 (307) (427)

Depreciation and amortization (31.444) (29.282) - -

Net added value generated by the Company 91.802 70.365 (307) (427)

Added value received as transferEquity in income of subsidiaries - - 14.929 9.855 Financial income 3.314 2.118 4 6

3.314 2.118 14.933 9.861

Total added value payable 95.116 72.483 14.626 9.434

Personnel 18.373 26.579 4 - Direct remuneration 14.961 18.014 - - Benefits 1.925 6.637 4 - FGTS (Government Severance Indemnity Fund for Employees) 1.487 1.928 - -

Taxes, rates and contributions 12.975 9.619 11 409 Federal 11.428 6.907 - - State 1.138 2.170 11 14 Other taxes 409 542 - 395

Third-party capital remuneration 49.446 27.284 289 24 Interest 31.690 26.959 - - Rents 76 197 - - Others 17.680 128 289 24

Remuneration of own capital 14.322 9.001 14.322 9.001 Income for the period 14.322 9.001 14.322 9.001

See the accompanying notes to the quarterly information.




September 30, 2014

11

Notes to the quarterly financial information (In thousands of reais)

1 Operations The Company, located at Rodovia BR 050 (KM 121) - Distrito Industrial I of Uberaba/MG, is a limited-liability company engaged in holding interest in other companies that produce, sell and export sugar, ethanol, power and other products derived from the processing of sugarcane. It obtained its registry of publicly-traded company on March 4, 2009, by means of CVM/SEP/RIC Circular Nº 001/2009, for trading of common shares on the non-organized over-the-counter market. The Company is the parent company of the following companies:

• Triângulo Mineiro Açúcar e Álcool S/A. (Triângulo Mineiro);

• Vale do Tijuco Açúcar e Álcool S/A. (Vale do Tijuco); and

• Rio Tijuco Agropecuária S/A. (Rio Tijuco).

The subsidiary Triângulo Mineiro Açúcar e Álcool S/A. with head offices in Uberlândia, and the subsidiaries Vale do Tijuco Açúcar e Álcool S/A. and Rio Tijuco Agropecuária S/A., both with head offices in Uberaba, are engaged in the production, sale and export of sugar, ethanol and other products derived from the processing of sugarcane; the provision of services to third parties and industrialization by their order; co-generation and sale of electric power, and it may exploit the planting of sugarcane in their own or third-party land; the sale of their own or third-party sugarcane; the intermediation of sale of sugarcane, and in holding interests as a shareholder or partner in other companies. The subsidiary Triângulo Mineiro Açúcar e Álcool S/A. is at pre-operating phase with estimated grinding of 2.2 million tons per year for the first phase and 5.5 million for the final phase of expansion, according to the business plan. The operations of the subsidiary Vale do Tijuco Açúcar e Álcool S/A. began on April 12, 2010. The industrial plant of Vale do Tijuco Açúcar e Álcool S/A. has grinding capacity of around 4 million tons of sugarcane per year, producing sugar, anhydrous ethanol, hydrated ethanol and power, as well as the by-products fusel oil and sugarcane bagasse. The subsidiary Rio Tijuco Agropecuária S/A. is in the operating phase and its main activity is the cultivation and trading of sugarcane both in own lands and third party lands. The planting of sugarcane requires a period of up to 18 months for maturation and beginning of harvest, which usually occurs between April and November. The sale of the production occurs throughout the year and it does not suffer variations due to seasonality, but only variation of the usual market offer and demand (commodity price and foreign exchange). In order to extend the Company’s debt profile, which on September 30, 2014 presented current liabilities above current assets in the amount of R$ 251,472, Management adopted the following strategies:


Report on the review of quarterly information - ITR Quarter ended

September 30, 2014

12

• On September 24, 2014, Certificates of Agribusiness Credit Rights ("CDCA") in the amount of

R$ 99,000 were issued, maturing in 54 installments as of their issuance date, under a fiduciary regime, recorded at BM&F Bovespa and CETIP. The release of that amount occurred subsequently as described in note 30 and will be used for the repayment of short term loans according to their maturities. CDCA installments will bear interest levied on an annual basis, as of the date of payment of the CRA until the respective payment date of each installment of CDCA interest, calculated on the nominal value and equivalent to 100% of accumulated average daily rates of DI over extra group - Interbank Deposits, calculated by CETIP. The issuance will be in favor of Gaia Agro Securitizadora S.A., whose amount mentioned will be released until December 2014. Financial institutions and agents were hired as follow: Leading coordinating bank: BB-Banco de Investimentos S/A; issuing creditor agent: Gaia Agro Securitizadora S.A.; fiduciary agent: Planner Trustee Distribuidora de Títulos e Valores Mobiliários Ltda; registrar agent: BNY mellon Serviços Financeiros Distribuidora de Títulos e Valores Mobiliários S.A.; custodian agent: SLW Corretora de Valores de Câmbio Ltda.; and

• The Company's management is already renegotiating balances of loans and funding adequate to finance its activity, besides extending the debt profile with the main creditor banks whose debt is classified as current liabilities, in order to adjust its operating cash flow. The strategic planning that the Company has been implementing aims to generate positive results in the coming years. Among the main actions taken, it is worth highlighting the obtainment of long-term credit facilities for adjusting working capital and reducing financial expenses.

These strategies were approved by the Company’s shareholders.

2 Group entities The consolidated financial statements include the financial statements of the parent company Companhia Mineira de Açúcar e Álcool Participações and the following subsidiaries: Ownership interest Subsidiaries Country 2014 2013 Triângulo Mineiro Açúcar e Álcool S/A. (Triângulo Mineiro) Brazil 99.99% 99.99% Vale do Tijuco Açúcar e Álcool S/A. (Vale do Tijuco) Brazil 99.99% 99.99% Rio Tijuco Agropecuária S/A. (Rio Tijuco) Brazil 100% - The individual and consolidated financial statements for the twelve-month period ended September 30, 2014 comprise the Company and its subsidiaries (collectively referred to as the “Group”).



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3 Preparation basis

a. Statement of compliance (in relation to IFRS standards and CPC standards) These quarterly information of the Parent Company and the Consolidated, included in the Quarterly Information Form - ITR, were prepared in accordance with CPC 21 (R1) - Interim Financial Reporting and with IAS 34 - Interim Financial Reporting, issued by International Accounting Standards Board (IASB), and presented in accordance with the rules issued by the Brazilian Securities and Exchange Commission (CVM), applicable to the preparation of Quarterly Information - ITR and are identified as “Company” and “Consolidated” respectively.

These practices differ from IFRS applicable to individual interim financial information only with regard to the valuation of investments in subsidiaries under the equity method, where under IFRS the investment would be valued at cost or fair value.

However, there is no difference between the shareholders' equity and consolidated result presented by the Group and the shareholders' equity and result of the Parent company in its individual quarterly information. Accordingly, the Group’s consolidated quarterly information and the Parent Company's individual quarterly information are being presented side by side in a single set of quarterly information.

The issue of individual and consolidated financial statements was authorized by the Board of Directors in a meeting held on November 05, 2014.

b. Measuring basis The individual and consolidated financial statements were prepared based on the historical cost, except for the following items recognized in the balance sheets:

• Financial instruments measured at fair value through profit or loss; and

• Biological assets measured at fair value less sales expenses.

c. Functional currency and presentation currency These individual and consolidated financial statements are being presented in reais, functional currency of the Company and its subsidiaries. All financial information presented in Brazilian Reais has been rounded to the nearest value in thousands, except otherwise indicated.

d. Use of estimates and judgments The preparation of individual and consolidated financial statements according to IFRS and CPC standards requires Management to make judgments, estimates and assumptions that affect the application of accounting principles and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates. Estimates and assumptions are revised on an ongoing basis. Revisions to accounting estimates are recognized in the year in which the estimates are revised and in any future periods affected. The information on critical judgments that refer to accounting policies adopted that have effects on amounts recognized in the financial statements is presented in the following notes:

• Note 18 – Deferred tax assets and liabilities; and



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• Note 24 – Financial instruments.

Information on uncertainties as to assumptions and estimates that pose a significant risk of resulting in a material adjustment within the next financial year are included in the following notes:

• Note 7 - Trade accounts receivable and other receivables;

• Note 11 – Biological assets;

• Note 12 – Property, plant and equipment; and

• Note 16 – Provision for contingencies.

4 Significant accounting policies The accounting policies described in detail below have been consistently applied to all the periods presented in these individual and consolidated financial statements. The accounting policies have also been consistently applied by the Group companies.

a. Basis of consolidation

(i) Business combination among entities under joint control The measurement of transactions relating to acquisitions of subsidiaries under common control is carried out book value.

(ii) Subsidiaries The financial statements of subsidiaries are included in the consolidated financial statements as from the date they start to be controlled by the Group until the date such control ceases. The accounting policies of the subsidiaries are aligned with the policies adopted by the Group. The Company’s financial information of subsidiaries is recognized under the equity method in the individual financial statements. The financial statements of the subsidiaries on the same base date of submittal of the financial statements are used to calculate equity in the earnings and consolidation. Subsidiaries are consolidated in the consolidated financial statements.



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(iii) Transactions eliminated in the consolidation Balances and transactions with subsidiaries, and any income or expenses derived from transactions with subsidiaries, are eliminated in the preparation of the consolidated financial statements. Unrealized gains originating from transactions with investee company recorded using the equity method, are eliminated against the investment in the proportion of the Company's interest in the investee company. Unrealized losses are eliminated in the same way as unrealized gains, but only up to the point where there is no evidence of loss due to impairment.

b. Foreign currency Foreign currency transactions Transactions in foreign currency are translated into the functional currency of the Group at the exchange rates on the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies at the reporting date are retranslated into the functional currency at the exchange rate at that date. Exchange gain or loss in monetary items is the difference between the amortized cost of the functional currency at the beginning of the period, adjusted by interest and effective payments during the period, and the amortized cost in foreign currency at the exchange rate at the end of the presentation period. Non-monetary items measured at historical costs in foreign currencies are converted by the exchange rate prevailing on the transaction date. Exchange differences arising from the reconversion are charged to income.

c. Financial instruments

(i) Non-derivative financial assets The Group recognizes loans and receivables and deposits initially at the date of the transaction that originated them. The other financial assets (including assets designated at fair value through profit or loss) are initially recognized on the date of the negotiation under which the Company becomes a party to the contractual provisions of the instrument. The Group writes-off a financial asset when the contractual rights to the cash flow of the asset expire, or when the Group transfers the rights to the reception of contractual cash flows over a financial asset in a transaction in which essentially all the risks and benefits of ownership of the financial asset are transferred. Any interest in transferred financial assets that is created or retained by the Group is recognized as a separate asset or liability. Financial assets and liabilities are offset and the net amount reported in the balance sheet only when there is a legally enforceable right of the Group to set off and there is intention to settle on a net basis, or to realize the asset and settle the liability simultaneously. The Group has the following non-derivative financial assets: trade accounts receivable and other receivables, other current assets and receivables with related parties.



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Financial assets measured at fair value through profit or loss A financial asset is classified as measured at fair value through profit or loss if it is held for trading or is designated as such upon initial recognition. The transaction costs are recognized in income (loss) as incurred. Financial assets measured at fair value through profit or loss are measured at fair value and changes in the fair value of such assets, which consider any gain with dividends, are recognized in profit or loss for the year. Financial assets classified as held for trading are actively managed to meet the liquidity needs of the Group. Accounts receivable and other receivables Trade accounts receivable and other receivables are financial assets with fixed or determinable payments, but not quoted on any active market. Such assets are initially recognized at fair value plus any transaction costs directly assignable. After their initial recognition are measured at amortized cost using the effective interest rate method, reduced by any impairment losses. Trade and other receivables include cash and cash equivalents, trade receivables, other receivables and advances to suppliers. Cash and cash equivalents Cash and cash equivalents comprise balances of cash and financial investments with original maturities of three months or less as of the contracting date, which are subject to an insignificant risk of change in value and are used to manage short-term obligations.

(ii) Non-derivative financial liabilities The Group recognizes non-derivative financial liabilities on the date that they are originated. All other financial liabilities are recognized initially on the negotiation date on which the Company and its subsidiaries becomes a party to the contractual provisions of the instrument. The Company and its subsidiaries write off a financial liability when its contractual obligations are discharged or canceled or expired. Such financial liabilities are initially recognized at fair value, net of any transaction costs directly assignable. After their initial recognition, these financial liabilities are measured at amortized cost using the effective interest rate method. The Company and its subsidiaries have the following non-derivative liabilities: loans and financing, suppliers and other accounts payable and debts with related parties.

(iii) Capital – Parent company Common shares Common shares are classified as shareholders' equity. Additional costs directly attributable to the issue of shares are recognized as a deduction from shareholders' equity, net of any tax effects. The Company’s bylaws determines a percentage higher than 25% to payment of compulsory minimum dividends.



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(iv) Derivative financial instruments, including hedge accounting The Group holds derivative financial instruments to hedge its exposure to foreign currency and interest rate changes. Upon initial designation of the derivative as a hedging instrument, the Group formally documents the relationship between the hedge instruments and the hedgeable items, including the risk management goals and the strategy in the execution of the hedge transaction and the hedgeable risk, together with the methods that will be used to assess the effectiveness of the hedge relationship. The Group evaluates the hedge relationship, initially and then continuously, to conclude if hedge instruments are expected to be "highly effective" in the offset of variations in fair value or cash flows of items subject to hedge during the period for which hedge is assigned whether the actual results of each hedge are within the range of 80%-125%. For a cash flows hedge of a planned transaction, the transaction should have its occurrence as highly probable and should present exposure to variations in the cash flows that at the end could affect the reported income (loss). Derivatives are initially recognized at their fair value; any attributable transaction costs are recognized in profit or loss when incurred. After the initial recognition, derivatives are measured at fair value and changes in fair value are recorded as described below. Cash flow hedge When a derivative is designated as a hedge instrument to hedge cash flow variability attributed to a specific risk associated with a recognized asset or liability or a highly probable foreseen transaction that could affect the net income, the effective portion of variation in the derivative's fair value is recognized in other comprehensive income and disclosed in “equity evaluation adjustments” caption in shareholders' equity. Any non-effective portion of the variations in the fair value of the derivative is recognized immediately in net income. When the hedged item is a non-financial asset, the accumulated amount held in other comprehensive income is reclassified to income (loss) in the same year or years during which the non-financial asset does not affect income (loss). In other cases, the amount accumulated in other comprehensive income is transferred to income (loss) in the same year in which the hedgeable item affects income (loss). If the hedge instrument no longer satisfies the hedge accounting criteria, expires or is sold, wound up, exercised or has its designation revoked, then the hedge accounting is discontinued prospectively. If there are no more expectations regarding the occurrence of the planned transaction, then the balance in other comprehensive income is reclassified to income (loss).

d. Property, plant and equipment

(i) Recognition and measurement PP&E items are stated at historical acquisition or construction cost, net of accumulated depreciation and impairment losses, when applicable. The cost includes expenditures that are directly attributable to the acquisition of assets. The cost of assets constructed by the Company itself and its subsidiaries include:

• The cost of materials and direct labor;

• Any other costs directly attributable to bringing the assets to the location and condition required for them to operate in the manner intended by the Management;



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• The costs for dismantling and restoration of the site where these assets are located; and

• Borrowing costs on qualifiable assets.

Purchased software that is integral to the functionality of a piece of equipment is capitalized as part of that equipment. When parts of a property, plant and equipment item have different useful lives, they are accounted for as separate items (major components) of PP&E. Gains and losses on disposal of a property, plant and equipment item are determined by comparing the proceeds from disposal with the carrying amount of Property, plant and equipment and are recognized net within "Other income" in the income (loss).

(ii) Subsequent costs Subsequent expenses are capitalized only when it is probable that associated future benefits may be earned by the Company and its subsidiaries. Maintenance expenses and recurring repairs are recognized in the income when incurred.

(iii) Maintenance costs The maintenance cost of a component of property, plant and equipment is recognized in the book value of the item when it is probable that the future economic benefits embodied in the component will flow and its cost can be reliably measured. The book value of the component that has been replaced by another is written off. Costs of normal maintenance on property, plant and equipment are charged to the income statement as incurred. The subsidiary Vale do Tijuco Açúcar e Álcool S/A. performs annual maintenance at its manufacturing unit, approximately in the period from December to March. The main maintenance costs include costs of labor, materials, outsourced services and overhead allocated during the off-season period. Said costs are accounted for as a component of the cost of the equipment and depreciated during the following harvest. Any other type of expenditure, which does not increase the useful life or maintain the grinding capacity, is recognized as an expense.

(iv) Depreciation Items of property, plant and equipment are depreciated from the date they are installed and are available for use, or, in the case of assets constructed by the Company, as of the date the construction is concluded and the asset is available for use.



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Depreciation is calculated to amortize the cost of property, plant and equipment items using the straight-line method based on estimated useful lives of items. Depreciation is generally recognized in income (loss), unless the amount is included in the book value of another asset. Land is not depreciated. The estimated useful lives such as weighted average rates, for the current and comparative years are as follows: Consolidated Annual weighted average rate

Years Rates Industrial equipment 19 5.40% Constructions and buildings 36 2.75% Agricultural machinery and tractors 5 18.75% Paving 10 10% Vehicles 5 20% Agricultural equipment 6 17.06% Machinery, equipment and tools 6 18.06% Furniture and fixtures 7 15.12% Computers and peripherals 5 19.85% Others 6 16.10% The depreciation methods, useful lives and residual values are reviewed at each reporting date and potential adjustments will be recognized as a change in accounting estimates.

e. Investments The financial statements of the subsidiaries are included in the consolidated financial statements as from the date they start to be controlled by the Company until the date such control ceases. The accounting policies of the subsidiaries are aligned with the policies adopted by the Parent company. The Individual financial information of the parent company, financial information of subsidiaries are recognized under the equity method.

f. Intangible assets

(i) Other intangible assets Other intangible assets acquired by the Group with finite useful lives are carried at cost, less accumulated amortization and accumulated impairment losses, when applicable.

(ii) Subsequent expenses Subsequent expenses are capitalized only when they increase the future economic benefits embodied in the specific asset to which they relate. All other expenditures are recognized in profit or loss as incurred.



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(iii) Amortization Amortization is recognized in income on a straight-line basis over the estimated useful lives of the intangible assets as of the date they are available for use. The estimated useful life for the current years and comparative are presented below: Software 5 years The depreciation methods, useful lives and residual values are reviewed at each reporting date and potential adjustments will be recognized as a change in accounting estimates.

g. Biological assets Biological assets are measured at fair value less sales expenses. Changes in fair value less sales expenses are recognized in results. Sale costs include all costs that are necessary to sell the assets. Sugarcane is transferred to the cost of production at their fair value, minus estimated selling expenses determined on the cutoff date.

h. Leased assets Leases in terms of which the Group assumes substantially all the risks and rewards of ownership are classified as finance leases. Upon initial recognition, the leased asset is measured at an amount equal to the lower of its fair value and the present value of the minimum lease payments. Subsequent to initial recognition, the asset is accounted for in accordance with the accounting policy applicable to that asset. The other leases are operating leases and are not recognized in the balance sheets of the Group.

i. Inventories Inventories are measured at the lower of cost and net realizable value. Inventory costs are valued at the average cost of purchase or production and include expenses incurred in the acquisition of inventories, production and conversion costs and other costs incurred in bringing them to their current locations and conditions. The net realizable value is the estimated price at which inventories can be realized in the normal course of business, less the estimated completion costs and selling expenses. The sugarcane consumed in the production process is measured at its fair value, net of sales expenses determined on the cutoff date.

j. Impairment

(i) Financial assets (including receivables) A financial asset not measured at fair value through profit or loss is assessed at each reporting date for objective evidence of impairment loss. An asset is impaired when there is objective evidence that a loss event has occurred after the initial recognition of the asset, and that such loss event had a negative effect on the projected future cash flows of that asset that can be reliably estimated. Objective evidence that financial assets (including equity securities) are impaired can include default or delinquency by a debtor, restructuring of the amount due to the Group on terms that the Group would not consider otherwise, indication that the debtor or issuer will file for bankruptcy, or disappearance of an active market for a security. In addition, for an equity



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instrument, a significant or prolonged decrease in the fair value of the asset, below its cost, is objective evidence of impairment. A decrease in the recoverable value of a financial asset measured at amortized cost is calculated as the difference between the asset's book value and the present value of estimated future cash flows discounted at the financial asset's original effective interest rate. The losses are recognized in an allowance in the income statement against receivables. Interest on the impaired asset continues to be recognized through the unwinding of the discount. When a subsequent event causes the amount of the impairment loss to decrease, the decrease in impairment loss is reversed through profit or loss. Financial assets measured at the amortized cost The Company and its subsidiaries consider as evidence of impairment of assets measured by amortized cost (for receivables) both individually and on an aggregate basis. Individually significant receivables are assessed for impairment. All the receivables are material on an individual basis, identified as non-impaired on an individual basis are collectively assessed for any impairment loss not yet identified. Individually significant assets are assessed on an aggregate basis in relation to impairment by grouping the notes with similar risk characteristics. When assessing impairment on an aggregate basis the Company and its subsidiaries make use of historical trends of probability of default, the recovery term and the amounts of losses incurred, adjusted to reflect the management's judgment in relation to the assumptions, if the current economic and credit conditions are such that the actual losses will probably be higher or lower than those suggested by historical trends. A decrease in the recoverable value of a financial asset measured at amortized cost is calculated as the difference between the asset's book value and the present value of estimated future cash flows discounted at the financial asset's original effective interest rate. The losses are recognized in an allowance in the income statement against receivables. Interest on the impaired asset continues to be recognized through the unwinding of the discount. When a subsequent event causes the amount of the impairment loss to decrease, the decrease in impairment loss is reversed through profit or loss. Group’s management did not identify any evidence that would justify the need of provision for recoverability on September 30, 2014.

(ii) Non-financial assets The carrying amounts of the non-financial assets of the Group, except for biological assets, inventories and deferred income and social contribution taxes are reviewed at each reporting date for indication of impairment. If such indication exists, the asset's recoverable amount is determined. The recoverable value of an asset or cash-generating unit is the greater of its value in use and its fair value less selling expenses. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market conditions as to the recoverability period of capital and the risks specific to the asset.



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Impairment losses are recognized in profit or loss. An impairment loss is reversed only with the condition that the book value of the asset does not exceed the book value that would have been calculated, net of depreciation or amortization, if the value loss had not been recognized.

k. Employee benefits

(i) Defined contribution plans A defined contribution plan is a post-employment benefit plan under which an entity pays fixed contributions into a separate entity (pension fund) and will have no legal or constructive obligation to pay further amounts. Prepaid contributions are recognized as an asset to the extent that a cash refund or a reduction in the future payments is available. The contributions to a defined contribution plan whose expected maturity is 12 months from the end of the period in which the employee renders the service are discounted to their present values. The obligations to make contributions into defined contribution plans are recognized as an expense in the income statement as incurred. The Group does not have other post-employment benefits.

(ii) Short-term employee benefits Obligations for short-term employee benefits are measured on a non-discounted basis and incurred as expenses as the related service is rendered. The liability is recognized at the amount expected to be paid under the cash bonus plans or short-term profit sharing if the Company has a legal or constructive obligation to pay this amount as a result of prior service rendered by the employee, and the obligation can be reliably estimated.

l. Provisions A provision is set up when the Group has a legal or constructive obligation as a result of a past event, which can be reliably estimated, and it is probable that an outflow of funds will be required to settle the obligation. Provisions are recorded considering the best estimates of the risk involved.



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m. Operating income

(i) Sale of products The operating income from sales of products in the normal course of business is measured by the fair value of the installment received or receivable. Operating income is recognized when there is convincing evidence that the risks and rewards inherent to the ownership of the assets have been transferred to the purchaser, it is probable that the financial economic benefits will flow to the Group, the related costs and potential return of goods can be reliably estimated, there is no continued involvement with the goods sold, and the amount of operating income can be reliably measured. The correct moment for the transfer of risks and benefits varies depending on the individual conditions of each sales agreement. For sugar and ethanol sales in the domestic market, transfer is normally carried out when the product is delivered in the client's premises of when it is picked up by the client in the Group's premises. For sales in the foreign market, the transfer occurs upon loading of goods in the transportation company of the seller harbor.

(ii) Sale of electricity The operating income in the ordinary course of business of the Company and its subsidiaries is measured at fair value of the consideration received or receivable. Operating income is recognized when there is convincing evidence that the most significant risks and rewards have been transferred to the purchaser, it is probable that the financial economic benefits will flow to the entity, the related costs can be reliably estimated, and the amount of operating income can be reliably measured. Income from the sale of power generation is recorded based on the guaranteed energy and tariffs specified in the terms of supply agreements or the prevailing market price, as applicable.

n. Leases

(i) Lease payments Payments for operating leasing are charged to income on the straight-line basis over the lease period. Minimum lease payments made under financial leasing are apportioned between financial expenses and reduction of the outstanding liability. Financial expenses are allocated in each period over the lease period in order to produce a continuous and periodic compounding interest rate over the remaining liability balance.

(ii) Determining whether an agreement contains a lease At the inception of an agreement, the Group defines whether the agreement is for or contains a lease. This is the case if the two conditions below are met:

• Meeting the agreement depends on the use of said specified asset and

• The agreement has a right of use of the asset.

o. Financial income and expense Financial income comprise mainly returns on interest earning bank deposits, exchange variations in assets and changes in the fair value of financial instruments measured at fair value



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through profit or loss. Interest income is recognized in income (loss) under the effective interest method. Financial expenses include mainly loan and financing interest expenses, exchange variations in liabilities, changes in the fair value of financial instruments measured at fair value through profit or loss and impairment losses recognized in financial assets. Borrowing costs which are not directly attributable to the acquisition, construction, or production of a qualifying asset are accounted for in profit or loss using the effective interest rate method.

p. Current and deferred income tax and social contribution The income and social contribution taxes for both current and deferred, are calculated based on the rates of 15%, (plus a surcharge of 10% on taxable income in excess of R$ 240 for income tax) and 9% on taxable income, and consider the offsetting of tax loss carryforward and negative basis of social contribution, limited to 30% of the annual taxable income. Income tax and social contribution expense comprises both current and deferred taxes. Current taxes and deferred taxes are recognized in income unless they are related to other comprehensive income. Current taxes are the taxes payable or receivable on the taxable income or loss for the period, at tax rates enacted or substantively enacted on the date of presentation of the financial statements, and any adjustments to taxes payable in relation to prior periods. Deferred taxes are recognized in relation to the temporary differences between the book values of assets and liabilities for accounting purposes and the related amounts used for taxation purposes. Deferred taxes are measured at tax rates expected to be applied to temporary differences when they are reversed, based on laws enacted or substantively decreed up to the reporting date of the financial statements. To determine current and deferred income tax, the Group takes into consideration the impact of uncertainties on position taken on taxes and if the additional income tax and interest payment has to be made. The Group believes that the provision for income tax recorded in liabilities is adequate for all outstanding tax periods, based on its evaluation of several factors, including interpretations of tax laws and past experience. This evaluation is based on estimates and assumptions that may involve several judgments on future events. New information may be made available, leading the Group to change its judgment on the adequacy of existing provision; these changes will impact income tax expenses in the year in which they occur. Deferred tax assets and liabilities are offset when there is a legal enforceable right to set off current tax assets against tax liabilities, and the latter relate to income taxes levied by the same tax authority on the same taxable entity. A deferred income tax and social contribution asset is recognized for unused tax losses, tax credits and deductible temporary differences, to the extent that it is probable that future taxable income will be available against which the unused tax losses and credits can be utilized.



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Deferred income and social contribution tax assets are reviewed at each reporting date and reduced when their realization is no longer probable.

q. Earnings per share – basic and diluted The basic earnings per share are calculated by dividing the result for the period attributable to the Group's shareholders by the weighted average of outstanding common shares in the respective period. The Group has no instruments that could potentially dilute earnings per share.

r. Segment information The Group's management bases its reports on the financial statements on the same basis in which such information are disclosed, as these financial statements are those regularly reviewed by the chief manager of the Group for decision making about resource allocations. Therefore, the Company has only one operating segment, called “energy”.

s. Statement of added value (“DVA”) The Group prepared individual and consolidated statements of added value in accordance with the rules of technical pronouncement CPC 09 - Statement of Added Value, which are presented as an integral part of the financial statements under accounting practices adopted in Brazil applicable to publicly-held companies, whereas under IFRS they represent additional financial information.

t. New standards and interpretations not yet adopted IFRS 9 - Financial Instruments introduces new requirements for classification and measurement of financial assets. The Accounting Pronouncements Committee has not yet issued any accounting pronouncement or amendments in current pronouncements corresponding to this standard.

5 Determination of the fair value A number of the Group's accounting policies and disclosures require the determination of fair value, for both financial and non-financial assets and liabilities. Fair values have been determined for measurement and/or disclosure purposes based on the following methods. When applicable, additional information about the assumptions made in determining fair values is disclosed in the notes specific to that asset or liability. The Group established a control structure for measuring fair value. This includes a valuation team which has overall responsibility for overseeing all significant fair value measurements. The Group periodically reviews unobservable data considered significant and valuation adjustments. If third-party information, such as broker quotes or pricing services, is used to measure fair values, then the management assesses the evidence obtained from the third parties to support the conclusion that such valuations meet the CPC requirements, including the level in the fair value hierarchy in which such valuations should be classified. When measuring fair value of an asset or liability, the Group uses observable data as much as possible. Fair values are classified at different levels according to hierarchy based on information (inputs) used in valuation techniques, as follows:

• Level 1: prices quoted (not adjusted) in active markets for identical assets and liabilities.



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• Level 2: inputs, except for quoted prices, included in Level 1 which are observable for assets or liabilities, directly or indirectly.

• Level 3: inputs, for assets or liabilities, which are not based on observable market data (non-observable inputs).

All of the Group’s financial instruments, assets and liabilities are classified as “Level 2”. The Group recognizes transfers between fair value hierarchic levels at the end of the financial statements period in which changes occurred.

(i) Inventories Inventories are measured at cost and net realizable value, whichever is lower. Inventories are valued at average cost of acquisition that does not exceed the market value.

(ii) Biological assets The Group calculated biological assets represented by ratoons, which generate sugarcane plantations at the discounted future cash flow method. Discounted future cash flow is calculated considering assumptions such as sugarcane ton price, productivity, cut, load and transportation costs, crop treatment costs, agricultural partnership costs, capital costs and taxes, among others. Discount rate used to discount cash flow at present value is calculated based on Weighted Average Capital Cost (WACC) of 5.56% p.a. (6.13% as of March 31, 2014).

(iii) Trade accounts receivable and other credits The fair value of accounts receivable and other receivables is estimated as the present value of future cash flows, discounted at the market interest rate on presentation date.

(iv) Property, plant and equipment The fair value of property, plant and equipment is based on a market approach and on a cost approach using market prices quoted for similar items, when available, and replacement costs, when applicable.



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(v) Derivative financial instruments The fair value of forward contracts and cash flow swaps is based on brokers' quotations. These quotations are tested for reasonability through estimated future cash flows discount based on contract conditions and expiration and using market interest rates of a similar instrument on measurement date. Fair values reflect the instrument credit risk and include adjustments to consider the credit risk of the Company and the counterpart, if applicable.

(vi) Loans and financing The fair value that is determined for disclosure purposes is calculated based on the present value of principal and future cash flows, discounted at market interest rate on the date of presentation of the financial statements.

6 Cash and cash equivalents Consolidated Parent company

09/30/2014 03/31/2014 09/30/2014 03/31/2014 Cash and banks 20,878 39,880 1 - Interest earnings bank deposits 5,774 20,682 112 116

26,652

60,562 113 116

The cash balance arises from receipts of business transactions and are resources available to meet the immediate cash needs of the Company and its subsidiaries. All funds are deposited in prime bank institutions. Interest earning bank deposits are cash equivalents since they are promptly convertible into a known sum of cash and subject to an insignificant risk of change of value. These interest earning bank deposits refer to Bank Deposit Certificates (CDB) in several financial statements, remunerated at rates that vary from 95% to 100% of the CDI - Interbank Deposit Certificate. Interest earning bank deposits have no monthly maturity and may be redeemed at any time. The Group's exposure to interest rate risks and a sensitivity analysis of financial assets and liabilities are disclosed in Note 24.



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7 Trade accounts receivable and other receivables Consolidated Parent company

09/30/2014 03/31/2014 09/30/2014 03/31/2014 From the sale of ethanol 1,924 3,114 - - From the sale of energy 29,899 16,746 - - From the sale of sugar 2,047 2,913 - - From service rendering 276 1,587 - - From the sale of sugarcane 675 2,219 - - Others 873 4,674 - -

35,694 31,253 - - Trade accounts receivable Related party credits (Note 17) - - 1,907 41,181 Other receivables - - 1,907 41,181 35,694 31,253 1,907 41,181

Current assets (35,694) (31,253) - - Non-current assets - - 1,907 41,181 As of September 30, 2014, the Company did not have any operations that might generate a material effect from adjustments to present value. The Company’s exposure to credit risks and impairment losses related to trade accounts receivable and other receivables are disclosed in Note 24.

8 Inventories Consolidated Parent company

09/30/2014 03/31/2014

09/30/2014 03/31/2014 Finished product Hydrous ethanol 4,779 186 - - Anhydrous ethanol 47,578 4,879 - - VHP Sugar 54,729 - - - Storeroom Our inventory held by third parties - 350 - - Warehouse, sundry (a) 10,309 10,802 - - Advance to sundry suppliers 2,354 4,966 261 261 Advances to sugarcane suppliers (b) Third parties 40,984 24,543 - - Related parties (note 17) 5,053 1,541 - - Others - 857 - -

165,786 48,124 261 261 Total

Current assets (156,532) (39,747) (261) (261) Non-current assets 9,254 8,377 - -

(a) The most representative amounts of supplies refer to inputs and agricultural pesticides to be used in the planting areas

in plantation – own or third party’s.



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(b) The balance of advance to suppliers refers to the agreement for supply of sugarcane, signed between the subsidiary Vale do Tijuco Açúcar e Álcool S/A. and its suppliers. Balance classified in non-current assets refers to advance contracts that will be realized upon receipt of sugarcane beginning as of 2014/2015 crop, priced based on Total Recoverable Sugar (TRS) index disclosed by CONSECANA – Sao Paulo State Council of Sugarcane, Sugar and Alcohol Producers at the end of the crop.

9 Recoverable taxes and contributions Consolidated Parent company

09/30/2014 03/31/2014

09/30/2014 03/31/2014 COFINS recoverable 21,158 21,888 - - ICMS recoverable - Acquisition of fixed assets 9,903 11,261 - - ICMS recoverable - purchase of inputs 2,881 5,559 - - PIS recoverable 7,726 5,436 - - Income tax on financial investments 669 405 9 9 Other taxes recoverable 1,091 1,062 65 65

Total

43,428 45,611 74 74

Current assets (11,773) (15,502) (74) (74) Non-current assets 31,655 30,109 - - PIS and COFINS The balance comprises credits arising from the non-cumulative collection of PIS and COFINS (taxes on income) on purchases of parts used to perform maintenance on the manufacturing facilities and agricultural fleet, maintenance services provided at the manufacturing and agricultural facilities, freight and storage related to sales transactions and electric power, as well as other credits arising from purchases of machinery and equipment, buildings and constructions to be used in production. These credits may be compensated with other federal taxes. ICMS (Value-added tax on sales and services) The balance is mainly comprised of credits calculated on acquisition of property, plant and equipment items, realized at the rate of 1/48, and may be offset against taxes of the same nature. IRPJ and CSLL Refers to withholding income tax on financial investments and income tax and social contribution prepayments through an offset against federal taxes and contributions due.



September 30, 2014

30

10 Investments Breakdown of balances Parent company

09/30/2014

03/31/2014 Investment assessed under the equity method Rio Tijuco Agropecuária S/A. 11,263 11,032 Triângulo Mineiro Açúcar e Álcool S/A. (8,392) (8,038) Vale do Tijuco Açúcar e Álcool S/A. 118,191 117,988

121,062 120,982

Classified as: Investments 129,454 129,020 Provision for loss on investment (8,392) (8,038) On September 30, 2014, the Company recorded a gain of R$ 14,929 (R$ 9,855 on September 30, 2013) in equity income in its subsidiaries. The Company accounts its investments in subsidiaries under the equity method. The Company and its subsidiaries do not have their shares traded on the Stock Exchange. The chart below presents a summary of the Company’s financial information. Changes in the balances of investments in subsidiary Parent company

09/30/2014

03/31/2014 Opening balance of investments 120,982 106,084 Equity in income of subsidiaries 14,929 9,937 Equity evaluation adjustment (Vale do Tijuco) (14,849) (5,791) Paid-up capital - 10,752

121,062 120,982



September 30, 2014

31

Information from investee companies The chart below presents a summary of all financial information at subsidiaries:

Three and six month period ended 09/30/2014

3 months 6 months

Interest % Current

assets Non-current

assets Total assets

Current liabilities Non-current liabilities

Total liabilities

Shareholders' equity Income Expenses

Income (loss)

Equity in net

income of subsidiaries Income Expenses

Income (loss)

Equity in net income of

subsidiaries September 30, 2014 Triângulo Mineiro S/A. 99.99% 62 3,303 3,365 867 10,890 11,757 (8,392) - (137) (137) (137) - (359) (359) (359) Vale do Tijuco S/A. 99.99% 232,141 675,721 907,862 476,431 313,240 789,671 118,191 170,697 (150,734) 19,963 19,963 254,596 (239,540) 15,056 15,056 Rio Tijuco S/A. 100% 61 11,463 11,524 261 - 261 11,263 63 (56) 7 7 374 (142) 232 232

232,264 690,487 922,751 477,559 324,130 801,689 121,062 170,760 (150,927) 19,833

19,833 254,970 (240,041) 14,929 14,929

Three and six month period ended 09/30/2013

3 months 6 months

Interest % Current

assets Non-current

assets Total assets

Current liabilities Non-current liabilities

Total liabilities

Shareholders' equity Income Expenses

Income (loss)

Equity in net

income of subsidiaries Income Expenses

Income (loss)

Equity in net income of

subsidiaries September 30, 2013 Triângulo Mineiro S/A. 99.99% 566 33,622 34,188 536 41,267 41,803 (7,612) 192 - 192 192 860 (1,210) (350) (350) Vale do Tijuco S/A. 99.99% 175,072 658,681 833,753 421,799 302,840 724,639 109,114 135,525 (117,462) 18,063 18,063 203,448 (193,204) 10,244 10,244 Rio Tijuco S/A. 100% - 10,713 10,713 - - - 10,710 - (39) (39) (39) - (39) (39) (39)

175,638 703,016 878,654 422,335 344,107 766,442 112,212 135,717 (117,501) 18,216

18,216 204,308 (194,453) 9,855 9,855



September 30, 2014

32

11 Biological assets Consolidated Balance at March 31, 2013 117,437 Increase due to additions of planting 37,730 Decrease due to harvesting (10,420) Fair value less estimated selling expenses 5,188

Balance at September 30, 2013

149,935

Increase due to additions of planting

54,438 Decrease due to harvesting (27,815) Fair value less estimated selling expenses 1,852

Balance at March 31, 2014

178,410

Increase due to additions of planting

31,592 Decrease due to harvesting (44,958) Fair value less estimated selling expenses (788)

Balance at September 30, 2014

164,256

Biological assets will be realized in the following crops: Consolidated 2014/2015 27,089 2015/2016 48,890 2016/2017 37,986 2017/2018 26,260 2018 onwards 24,031

164,256

Sugarcane plantations Planted areas refer only to sugarcane plantations, and do not consider planted land. The following assumptions were used in the determination of the fair value: Consolidated

09/30/2014 03/31/2014 Estimated harvest area (hectares) 74,179 83,312 Estimated productivity (sugarcane tons/hectares) 82.57 83.83 Total recoverable sugar (TRS) (kg) 135 140 TRS value/kg (R$) 0.4915 0.4906 The discount rate used in the cash flow of each period, called as “Weighted-Average Cost of Capital”, corresponded to 5.56% per year (6.13% on March 31, 2014), which was revised and approved by the Company’s management. The Group is exposed to several risks related to its crops:



September 30, 2014

33

Regulatory and environmental risks The Group is subject to laws and regulations and established environmental policies and procedures directed to compliance with environmental laws and other. The management carries out regular analyses to identify environmental risks and assure that systems under operation are appropriate to manage those risks. Supply and demand risks The Group is exposed to risks resulting from the prices fluctuation and sales volume of its plantations. Where possible, the Group manages this risk by aligning its extraction volume with market supply and demand. The management analyzes on a regular basis the trend of the industry to ensure that the price structure of the Group is in accordance with market and to ensure that estimated volumes of harvest are consistent with expected demand. Climatic risks and others The Group’s plantations are exposed to risks of damages caused by climate changes, diseases, forest fires and other nature forces. The Group had extended processes in progress to monitor and reduce those risks, including health regulation inspections of the sugar cane areas and analysis of diseases and plagues of the industry. The Group also protects itself against natural disasters.



September 30, 2014

34

12 Property, plant and equipment

Consolidated Industrial

equipment Constructions and buildings

Agricultural machinery and

tractors Paving Vehicles Agricultural

equipment Land

Machinery, equipment and

tools Furniture

and fixtures Computers and

peripherals Construction in

process (a)

Off-season maintenance expenditures Others Total

Cost Balance at March 31, 2013 353,798 68,760 24,910 6,739 5,828 8,142 1,939 2,879 1,114 946 11,566 26,805 8,230 521,656 Additions 474 860 5,846 - 696 2,008 1,634 474 59 189 1,397 3,248 662 17,547 Write-offs - (14) (319) - (218) - - - (3) (7) - - (306) (867) Transfers 2,398 - - - - (1,977) - - - - (421) - - - Balance at September 30, 2013 356,670 69,606 30,437 6,739 6,306 8,173 3,573 3,353 1,170 1,128 12,542 30,053 8,586 538,336 Additions - 333 5,015 - 2,925 3,679 - 142 57 121 27,342 28,910 141 68,665 Write-offs (4,168) (9) (1,851) - (19) (1,978) - - - - - (27,498) (4,233) (39,756) Transfers (1) - - - 19 7,177 - (30) - (7) (7,916) - 758 - Balance at March 31, 2014 352,501 69,930 33,601 6,739 9,231 17,051 3,573 3,465 1,227 1,242 31,968 31,465 5,252 567,245

2,497 26 6,959 - 1,185 1,145 - 152 77 386 10,924 7,884 1,134 32,369 Additions Write-offs (267) (77) (412) - (151) - - - (46) - (2,989) (29,022) (902) (33,866) Transfers 19,328 3,650 (162) 1,123 10 162 - 163 37 (55) (24,318) - 62 -

374,059 73,529 39,986 7,862 10,275 18,358 3,573 3,780 1,295 1,573 15,585 10,327 5,546 565,748 Balance at September 30, 2014

Depreciation Balance at March 31, 2013 (38,445) (3,962) (9,827) (2,022) (1,407) (2,139) - (1,355) (456) (628) - - (1,042) (61,283) Depreciation for the year (9,245) (969) (2,625) (337) (547) (573) - (255) (89) (71) - - (195) (14,906) Balance at September 30, 2013 (47,690) (4,661) (12,452) (2,359) (1,954) (2,712) - (1,610) (545) (699) - - (1,237) (76,189) Additions (9,383) (1,095) (3,703) (336) (810) (1,285) - (301) (115) (125) - - (291) (17,444) Write-offs 1,828 - 1,230 - (16) - - - - - - - 122 3,164

Balance at March 31, 2014

(55,245) (6,026) (14,925) (2,695) (2,780) (3,997) - (1,911) (660) (824) - - (1,406) (90,469) Depreciation for the period (9,856) (1,004) (3,738) (346) (1,023) (1,375) - (313) (94) (87) - - (355) (18,191) Write-offs - 73 254 - 65 - - - 20 - - - 2 414 Transfers (39) - 68 - (1) (68) - 40 (3) - - - 3 -

(65,140) (6,957) (18,341) (3,041) (3,739) (5,440) - (2,184) (737) (911) - - (1,756) (108,246) Balance at September 30, 2014

Net book value Balance at March 31, 2014 297,256 63,904 18,676 4,044 6,451 13,054 3,573 1,554 567 418 31,968 31,465 3,846 476,776 Balance at September 30, 2014 308,919 66,572 21,645 4,821 6,536 12,918 3,573 1,596 558 662 15,585 10,327 3,790 457,502

(a) Basically refers to works for the expansion of industrial plant and acquisition of equipment.



September 30, 2014

35

Guarantee Property, plant and equipment items were given in guarantee of loans and financing, as described in note 14. Analysis of recovery value In accordance with CPC 01 (R1) IAS 36 Impairment of Assets, the Company assessed indicators of impairment as of September 30, 2014 and found no need to determine the recoverable amount.

13 Loans and financing This note discloses contract information on the loans and financing of the Company and its subsidiaries. Note 24 discloses additional information on the exposure to interest rate and currency risks of the Company and its subsidiaries. The subsidiary Vale do Tijuco Açúcar e Álcool S/A. obtained loans, contracted in local currency, in order to finance the acquisition of its industrial plant and operations. On September 30, 2014 and March 31, 2014, the balance of loans and financing is as follows: Consolidated

Credit facility Ref. Currency Index

Average interests and charges p.a. 09/30/2014 03/31/2014

Finame (a) R$ TJLP (Long-term interest rate) 7.47% 32,334 36,590

Finame (a) R$ Prefixed 5.66% 170,760 175,568

Working capital (b) R$ CDI (Interbank deposit certificate) 4.06% 50,045 25,830

Working capital (b) USD Prefixed 8.71% 26,998 17,078

Working capital (b) R$ Prefixed 9.98% 203 38,007

Indirect BNDES onlending (c) R$ TJLP (Long-term interest rate) 4.93% 47,303 51,824

Indirect BNDES onlending (c) R$ Prefixed 5.23% 49,240 54,357 ACC (Advance on exchange contract) (d) USD

CDI (Interbank deposit certificate) 5.82% 72,190 54,396

ACC (Advance on exchange contract) (d) USD Prefixed 5.53% 83,616 35,302

PPE (Export pre-payment) (d) USD Prefixed 6.38% 35,207 11,413

567,896 500,365

Transaction costs (2,420) (3,619)

Total 565,476 496,746

Current liabilities (316,981) (338,718)

Non-current liabilities 248,495 158,028

Parent company

Credit facility Ref. Currency Index

Average interests and charges p.a. 09/30/2014 03/31/2014

Loans - non-current (note 17) (e) R$ (e) (e) 2,570 41,370



September 30, 2014

36

(a) Refers to loans contracted to fund the acquisition of industrial and agricultural equipment. The loans have a grace

period for payment of the first installment of principal, interest and charges of 6-18 months from the date of contract signing. The contracts are secured by chattel mortgage on disposal of assets as a financing object and pledge of credit rights of electricity receivable.

(b) Refers to working capital loans obtained by the subsidiary Vale do Tijuco Açúcar e Álcool S/A. Interest is paid monthly after the signing of the contract. The loans are guaranteed by the Company's surety that mostly relate to 100% of the contracted facility.

(c) It refers to a credit operation signed between the subsidiary Vale do Tijuco Açúcar e Álcool S/A. and Banco do Brasil S.A., Banco de Desenvolvimento de Minas Gerais - BDMG and Bradesco S.A., which are the financial agents of the contract, in which Banco do Brasil S.A. is the Leader of the financial agents. The amount was released by the National Bank for Economic and Social Development - BNDES with the prerogative to finance project of implantation of a plant with grinding capacity of 1.8 million tons of sugarcane. The funds obtained were used for acquisition of industrial assets, for expansion of the production capacity of the unit. The contracts are guaranteed by statutory lien on disposal of assets as a financing object and pledge of credit rights of electricity receivable and are collateralized by the Company.

The contract of indirect repass of BNDES funds contains a restrictive clause that requires the subsidiary Vale do Tijuco Açúcar e Álcool S/A. to maintain the Index of Debt Service Coverage (ICSD), of at least 1.30 during the validity of the contract, which is calculated upon closing of the fiscal year, as follows: EBITDA (-) Income tax and social contribution (-) changes in working capital / amortization of principal + interest payment.

(d) The advances on exchange contracts and credit notes were signed with many financial institutions and will be settled through exports made in years 2014 and 2015.

(e) Amount granted by the subsidiary Vale do Tijuco Açúcar e Álcool S/A., not subject to interest, and which will be settled by the Company according to its available cash, as Note 17.

The transaction costs recorded under loans and financing, to be allocated to the result in each subsequent period, is as follows:

September 30, 2014

Book value

12 months

From 1 to 2 years

From 2 to 3 years

From 3 to 4 years

From 4 to 5 years

Over 5 years

Consolidated 2,420 943 1,110 139 126 94 8 March 31, 2014

Book value

12 months

From 1 to 2 years

From 2 to 3 years

From 3 to 4 years

From 4 to 5 years

Over 5 years

Consolidated 3,619 2,959 303 199 86 72 - Covenants The Company has contractual obligations arising from loans and financing and have not met the debt service coverage ratio, which must be equal to or greater than 1.30, contained in the Financing Agreement entered into Banco Bradesco S.A., Banco do Brasil S.A. and Banco de Desenvolvimento de Minas Gerais (“BDMG”) by means of indirect transfer of funds from the Brazilian Economic and Social Development Bank ("BNDES") for the amounts as of March 31, 2014. However, management got the waiver from Banco do Brasil, the leading bank for the operation, only after the closing of the year, for which it recorded the amount of R$ 96,399 in current liabilities as of March 31, 2014 and in non-current liabilities as of September 30, 2014, as a result of obtaining the waiver after the closing date of the year.



September 30, 2014

37

14 Debentures

Consolidated

Credit facility Currency Index Average interests and

charges p.a. 09/30/2014 03/31/2014 Debentures R$ CDI (Interbank deposit certificate) 3.00% 120,934 120,923 Transaction costs (1,499) - 119,435 120,923 Current liabilities (66,744) (27,404) Non-current liabilities 52,691 93,519

On November 11, 2013, the subsidiary “Vale do Tijuco” issued 12.000.000 debentures units pursuant to the indenture of sole series debentures, non-convertible into shares, in a single series, as collateral and personal guarantee in the nominal amount of R$ 120,000. Between the contracted parties, “Companhia Mineira de Açúcar e Álcool Participações” is the guarantor, and “Pentágono S/A - Distribuidora de Valores Mobiliários” is the representative company of the holders. The following financial institutions were contracted: Settlement Bank: Itaú Unibanco S/A; Banco Coordenador Líder: Banco Itaú BBA S.A.; Coordinating banks: Banco Rabobank International Brasil S.A., together with Banco Votorantim S.A. and Banco Itaú BBA S.A. The financial release of funds between financial institutions and the issuer occurred on January 20, 2014 maturing in November 2016. Maturities range from June to November of each year.

15 Suppliers Consolidated Parent company

09/30/2014 03/31/2014 09/30/2014 03/31/2014 Domestic suppliers of materials and services 32,390 68,404 200 - Suppliers of fixed assets - 2,545 - - Sugarcane suppliers 29,251 6,775 - -

61,641 77,724 200 -

The sugarcane harvest period, between April and December of each year, on average, has direct impact on the balance of suppliers of sugarcane and respective cutting, loading and transportation services. Amounts payable to sugarcane suppliers and agricultural partners take into consideration sugarcane delivered and not yet paid, and possible supplementation of sugarcane price calculated based on the final harvest price, using the Total Recoverable Sugar (TRS) index disclosed by Consecana – Sao Paulo State Council of Sugarcane, Sugar and Alcohol Producers. The Company and its subsidiaries evaluated adjustments to present value of its suppliers’ balances on September 30, 2014 and March 31, 2014 and concluded that these amounts did not generate material adjustments to present value in financial information.



September 30, 2014

38

The exposure of the Group to currency and liquidity risks related to accounts payable to suppliers and other accounts payable, is disclosed in Note 24 - Financial instruments.

16 Provision for contingencies The Group is party to lawsuits involving labor, civil and tax contingencies. To face future losses linked to those processes, a provision was recorded at an amount considered by the Group's management as sufficient to cover probable losses. The Group classified the risk of loss in lawsuits as “remote”, “possible” or “probable”. The likelihood of lawsuit losses and the determination of involved amounts was performed considering claimers' requests, previous court decisions on the matter, and the opinion of legal counsel of the Group. The main information of lawsuits is presented as follows: Consolidated

09/30/2014 03/31/2014 Opening balance 1,208 722 Additions 843 1,149 Write-offs (1,137) (663)

Closing balance 914 1,208

Based on information from its legal advisors, analysis of the pending legal proceedings, based on previous experience with regards to amounts claimed, management recorded provisions for amounts considered sufficient to cover possible losses from the current actions. Unrecognized contingent liabilities Contingent liabilities not recognized in the financial statements refer to lawsuits for which an unfavorable outcome has been regarded as possible by the legal advisors, amounting to R$ 3,352 as of September 30, 2014 (R$ 1,079 as of March 31, 2014), for which no reserve has been recorded, taking into consideration that neither the accounting practices adopted in Brazil nor the International Financial Reporting Standards (IFRS) require it to be accounted for.

17 Related parties

a. Parent company and part of the final parent company Fundo de Investimento em Participações PCP and Zam Ventures, L.P. sold their total shares in the Company to IndoAgri Brazil Participações Ltda. and withdrew from the Company’s shareholders’ board. As of June 25, 2013, IndoAgri Brazil Participações Ltda. became holder of 50% of the Company’s shares. Accordingly, through shareholders’ agreement signed on that date, IndoAgri Brazil Participações Ltda. became holder of the joint control with the shareholders representatives of Ápia SP Participações S.A., according to shareholders’ board presented in note 19, item a.

b. Remuneration of key management staff Company’s key management personnel is comprised of the Executive Board elected in the Annual Shareholders' Meeting. The amounts related to the compensation of key management personnel in the period as short-term benefits were R$ 1,165 (R$ 1,470 on September 30, 2013), recorded in the group of general and administrative expenses and include salaries, bonuses, variable compensations and direct and indirect benefits.



September 30, 2014

39

The Company and its subsidiaries do not have other types of compensation, such as post-employment benefits, other long-term benefits or benefits of labor contract rescission.

c. Principal balances of transactions Transactions with related parties, except for the purchase of raw material, which is made according to the market price, are made based on conditions negotiated between the Company and the related companies, which could be different if they were made with non-related parties. The balances with related parties are presented as follows: Consolidated Parent company

09/30/2014 03/31/2014 09/30/2014 03/31/2014 Non-current assets Related party credits (Note 7) (a) Triângulo Mineiro Açúcar e Álcool S/A. - - 1,907 41,156 Vale do Tijuco Açúcar e Álcool S/A. - - - 25 Advances - Cane suppliers (Note 8) (b) Marco Otavio Galvão 5,053 1,541 - -

Total 5,053 1,541 1,907 41,181


09/30/2014 03/31/2014 09/30/2014 03/31/2014 Liabilities Debts with related parties (Note 13) (c) Vale do Tijuco Açúcar e Álcool S/A. - - 2,570 41,370

Total - - 2,570 41,370


09/30/2014 09/30/2013 09/30/2014 09/30/2013 Income (loss) (3 months) (3 months) (3 months) (3 months) Purchase of raw material (sugarcane) (d) Marco Otavio Galvão 2,480 1,137 - - JF Citrus Agropecuária 22 4,716 - -

Total 2,502 5,853 - -



September 30, 2014

40

(a) Amount granted to the respective subsidiaries, not subject to interest, and which will be settled by the Company according to its available cash.

(b) Amount granted to Marco Otávio Galvão, not subject to interest, and which will be settled upon delivery of sugarcane, in the 2014/2015 crop.

(c) Amount granted by the subsidiary Vale do Tijuco Açúcar e Álcool S/A., not subject to interest, and which will be settled by the Company according to its available cash.

(d) Mr. Marco Otávio Galvão and JF Citrus Agropecuária Ltda. have sugarcane properties near Usina Vale do Tijuco Açúcar e Álcool S/A. and, therefore, operate as regular suppliers of sugarcane. They are classified as related parties because they are shareholders of one of the Company’s parent companies.

On June 25, 2013 the Company increased its capital through the transfer of “Rio Tijuco” by its partner “JF Citrus Agropecuária Ltda” in the amount of R$ 10,752 (Note 19).

The Company grants collateral to its subsidiaries in contracts of loans and financing, as shown in note 13. The subsidiary Vale do Tijuco Açúcar e Álcool S/A. pledges collaterals for transactions with suppliers, as described in Note 24.

18 Deferred income and social contribution taxes Consolidated

Assets

Income (loss)

Shareholders' equity

09/30/2014

03/31/2014 09/30/2014 09/30/2014 09/30/2014 09/30/2014 (3 months) (6 months) (3 months) (6 months)

Provision for contingencies 311 411

(73) (100) - - Allowance for doubtful accounts 1 11 - (10) - - Effects of swap contracts 526 136 460 390 - - Tax losses and negative basis (a) 1,281 1,619 173 (338) - - Fair value of biological assets (3,685) (4,812) (577) 1,127 - -

Effects of exchange forward contracts (NDF)

10,635

2,983

-

-

5,006

7,652

Total

9,069

348

(17)

1,069

5,006

7,652

Consolidated

Assets

Income (loss)

Shareholders' equity

09/30/2013 03/31/2013 09/30/2013 09/30/2013 09/30/2013

09/30/2013 (3 months) (6 months) (3 months) (6 months)

Provision for contingencies 246

250 (10) 4 - - Allowance for doubtful accounts 10 10 1 - - - Effects of swap contracts 74 - - (74) - - Tax losses and negative basis (a) 944 1,099 (255) 155 - - Fair value of biological assets (3,147) (3,665) 846 (518) - -

Effects of exchange forward contracts (NDF)

(377)

1,768

(238)

2,145

-

-

Total

(2,250)

(538)

344

1,712

-

-

(a) The Company’s management recognized deferred tax assets of income tax and social contribution arising from tax

and social contribution loss carryforwards up to the limit of 30% of deferred tax liabilities of income tax and social contribution – annual offsetting limit of tax loss, according to the tax legislation, arising from the gain determined in the calculation of the fair value of biological asset. The remaining balance of unrecorded deferred income and social contribution tax losses and negative basis of social contribution is approximately R$ 36,646.



September 30, 2014

41

Reconciliation of deferred income and social contribution taxes

Effective rate reconciliation Consolidated

09/30/2014 09/30/2013 09/30/2014 09/30/2013 (3 months) (3 months) (6 months) (6 months) Income (loss) for the year before taxes 22,109 17,360 15,722 7,295 Nominal rate 34% 34% 34% 34%

Tax expense at statutory rate

(7,517) (5,902) (5,345) (2,480) Adjustment of income and social contribution taxes Non-deductible expenses 10,032 5,564 6,745 774

Current tax (2,478) (6) (2,469) (6) Deferred tax

(37)

344

1,069

1,712

Effective rate (11.38%) 1.95% 8.90% 23.39% The tax nominal rate is 34% on adjusted income, according to current legislation in Brazil for taxable income. The effective rate shown above is the best management estimate of the expected annual rate. The noted distortions arise from the effects of the non-accounting of the tax credits mentioned in item (a) of this note. Deductible timing differences and accumulated taxes losses do not lapse pursuant to the tax legislation in force.

19 Shareholders' equity

a. Capital As of September 30, 2014, capital is divided into 250,932,826 (same as on March 31, 2014) registered common shares and with no par value, distributed as follows:

Parent company 09/30/2014 03/31/2014

Shares R$ Shares R$ José Francisco de Fátima Santos 28,844,819 9,128 28,844,819 9,128 Maria Ângela Turchetto Santos 24,173,900 4,456 24,173,900 4,456 Luis Gustavo Turchetto Santos 3,324,276 613 3,324,276 613 Carlos Eduardo Turchetto Santos 3,324,276 613 3,324,276 613 Francisco José Turchetto Santos 3,324,276 613 3,324,276 613 IndoAgri Brazil Participações Ltda. 125,466,413 125,466 125,466,413 125,466 Ápia SP Participações S.A. 62,474,866 62,475 62,474,866 62,475

250,932,826 203,364 250,932,826 203,364



September 30, 2014

42

On June 25, 2013, there was a capital increase in the Company in the amount of R$ 10,752, upon the issuance of 58,320,628 new subscribed and paid-in common shares by contribution of full interest in the company joint-controlled company Rio Tijuco Agropecuária S/A., which net assets were valuated at carrying value, by the shareholders José Francisco de Fátima Santos, Maria Ângela Turchetto Santos, Luis Gustavo Turchetto Santos, Carlos Eduardo Turchetto Santos and Francisco José Turchetto Santos. On the same date, Indogri Brazil Participações Ltda. transferred 4,670,919 shares to the shareholder José Francisco of Fatima Santos and 2,333,161 shares for the shareholder Ápia SP Participações S.A. as determined by the shareholders' agreement and recorded in the Company’s book of transfer of shares.

b. Capital reserves As a result of the capital increase carried out on July 13, 2007, the Company set up a special goodwill reserve in the amount of R$ 4,164, according to the Brazilian Corporation Law.

c. Legal reserve The legal reserve is set up at the rate of 5% of the net income determined in each financial year, pursuant to article 193 of Law 6404/76 up to the limit of 20% of the share capital.

d. Statutory reserve The Company shall maintain a statutory reserve for business development or expansion, aimed at: (i) ensuring funds for investments in research & technology; (ii) increasing working capital to ensure proper operating conditions to meet the corporate objectives of the Company; and (iii) to finance the business growth of the Company. After the adjustments and legal deductions, up to 100% of the remaining net income can be allocated to the statutory reserve, up to the limit of the capital stock, in case it is approved at the Annual Shareholders’ Meeting.

e. Equity evaluation adjustment It includes the effective portion of the cumulative net exchange variation of liabilities in dollar and derivatives designated as cash flow hedge of future exports (hedged item), according to Note 24. The amounts recorded in equity valuation adjustments are reclassified into profit or loss when recognizing the export income.

f. Dividends The Company’s bylaws determines a percentage higher than 25% to payment of compulsory minimum dividends. In view of the accumulated losses, no dividend was declared or paid.

20 Net operating income The operating income of the Company are comprised of sugar and ethanol sales for the domestic and foreign market and electricity.

We reproduce below the reconciliation between gross income for tax purposes and the income presented in the statement of income for the year:



September 30, 2014

43

Consolidated

09/30/2014 09/30/2013 09/30/2014 09/30/2013 (3 months) (3 months) (6 months) (6 months) Gross income from sales and services: Ethanol – Domestic market 47,855 51,106 95,270 96,179 Sugar – Domestic market - 52 - 52 Sugar – Foreign market 81,202 72,903 92,403 89,703 Electric power (a) 38,332 16,152 61,540 25,531 Rendering of services - 292 - 292 Other income 259 1,245 607 1,245

Gross tax income 167,648

141,750 249,820 213,002 Sales tax (6,618) (4,964) (11,143) (10,764) Refunds and rebates - - (3) -

Net operating income 161,030

136,786 238,674 202,238

(a) It refers to the supply of electric energy to the Electric Energy Trading Chamber (CCEE, in Portuguese), as established in the contract entered into through the bid promoted by the Brazilian Electricity Regulatory Agency (ANEEL, in Portuguese). The energy supply contract establishes the supply of 876,000 Mwh, during the period between April 2010 and March 2025, as follows:

Contracted Exported Year of supply (Mwh) (Mwh) 2010 / 2011 17,520 17,520 2011 / 2012 61,320 61,320 2012 / 2013 61,320 61,320 2013 / 2014 61,320 61,320 2014 / 2015 61,320 61,320 2015 / 2016 61,320 - 2016 / 2017 61,320 - 2017 / 2018 61,320 - 2018 / 2019 61,320 - 2019 / 2020 61,320 - 2020 / 2021 61,320 - 2021 / 2022 61,320 - 2022 / 2023 61,320 - 2023 / 2024 61,320 - 2024 / 2025 61,320 -

Total

876,000 262,800

The energy income is divided into fixed and variable: Fixed income The subsidiary Vale do Tijuco Açúcar e Álcool S/A. is entitled to the annual fixed income of R$ 9,412, adjusted by the Extended National Consumer Price Index (IPCA, in Portuguese). The payment of the fixed income is monthly made in the proportion of one twelfth.



September 30, 2014

44

In case the energy is supplied at amounts below the committed one, the subsidiary Vale do Tijuco Açúcar e Álcool S/A. will be required to pay an annual refund to be calculated by CCEE at the end of each supply period. The Company already delivered 100% of the amount contracted by CCEE for the year regarding the amount of 61,320 Mwh. Variable income Of the total monthly generated energy, nearly 29.18% (79,671 Mwh) represented own consumption, and 22.46% (61,320 Mwh) was negotiated with CCEE, according to the contract entered into in the bid promoted by ANEEL. The remaining energy was negotiated mostly with Capitale, A-3 auction, Capitale Energia Comercializadora S/A and BTG Pactual Comercializadora de Energia Ltda in the amount of 132,010 MWh.

21 Expenses by nature The Company presented its statements of income using expenses classification based on function. Information on the nature of these expenses recognized in the statements of income is as follows: Consolidated Consolidated

09/30/2014

09/30/2013 09/30/2014 09/30/2013 (3 months) (3 months) (6 months) (6 months) Cost of goods sold CGS - Sugar (64,271) (43,489) (73,362) (57,850) CGS - Anhydrous alcohol (23,005) (20,072) (46,190) (39,051) CGS - Hydrated Alcohol (15,245) (19,650) (35,246) (39,676) CGS - Electricity (8,229) (4,261) (13,594) (7,713) Cost of services rendered - (1,315) - (1,315) CGS - Sugarcane (12) 760 (15) (258) Other expenses 368 (2,857) 261 (2,864) Recovery of PIS and COFINS 3,650 2,371 7,645 3,682

(106,744) (88,513)

(160,501) (145,045) Total

Sales expenses Freight, port expenses and commissions (12,413) (9,564) (18,582) (14,945) Depreciation, amortization and depletion (237) (235) (472) (472) Personnel expenses (443) (162) (831) (316) Other commercial expenses (128) 274 (255) 134

(13,221) (9,687)

(20,140) (15,599) Total

Administrative expenses Personnel expenses (2,357) (2,482) (4,723) (4,502) Third party services (820) (877) (1,511) (1,761) Depreciation, amortization and depletion (249) (233) (482) (445) Other administrative expenses (386) (269) (717) (757)

(3,812) (3,861)

(7,433) (7,465) Total



September 30, 2014

45

22 Commitments Sales commitment The subsidiary Vale do Tijuco Açúcar e Álcool S/A. mainly operates in the commodities market. The sales are substantially made at the price on the transaction date. However, the subsidiary Vale do Tijuco Açúcar e Álcool S/A. has several agreements in the market of sugar committing itself to selling certain volumes in future crops. As of September 30, 2014, the sale commitments of sugar amount to 220,000 tons, entered into for the 2014/2015 crop. The Company did not have future commitments for sale of ethanol as of September 30, 2014. Agricultural Partnership Agreements The subsidiaries Vale do Tijuco Açúcar e Álcool S/A. and Triângulo Mineiro Açúcar e Álcool S/A. have agriculture partnership contracts for sugarcane crops for the average duration of ten years. These contracts have the purpose of ensuring a portion of the future production, which is estimated as follows:

• 2014/2015 Crop onwards – 52,816,83 tons by crop, at an estimated cost of R$ 11.49 as of September 30, 2014.

The payments related to these obligations are calculated on a straight-line basis, according to the contracts, taking into account the commitment to the share of the partner, which will be valued by the prices to be set at each harvest by the CONSECANA – SP system. Operational lease The subsidiary Vale do Tijuco Açúcar e Álcool S/A. has operating lease contracts for lands, sugarcane crops for the average duration of five years. The payments related to these obligations are calculated on straight-line basis, according to the contracts. Payments are monthly made or as provided in each contract. The expenditures related to these contracts are as follows: 2014/2015 2014/2015 (3 months) (6 months)

Vale do Tijuco

719 1,890 Triângulo Mineiro 8 8

Total

727 1,898



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46

23 Net financial income (expenses) Consolidated

09/30/2014

09/30/2013 09/30/2014 09/30/2013 (3 months) (3 months) (6 months) (6 months) Financial expenses: Interest on loans and financing (16,261) (14,685) (31,622) (26,959) Tax on financial transactions—IOF (172) (889) (876) (1,415) Unrealized losses on derivative financial instruments: - Loss on fair value adjustment (1,738) - (2,530) (1,412) - Effective loss – settlement of transactions (716) (199) (1,059) (144) Net exchange variation (basically on ACC) (295) (79) (354) (1,315) Other financial expenses (763) (2,313) (1,359) (2,489)

(19,945)

(18,165) (37,800) (33,734) Financial income: Gains with derivative financial instruments: - Gains on fair value adjustment 797 330 1,664 - - Effective gains - settlement of transactions 2 - 6 - - Asset foreign exchange fluctuation 375 - 468 - Other financial income 587 1,259 1,176 1,259

1,761

1,589 3,314 1,259 Net financial income (loss) (18,184) (16,576) (34,486) (32,475)

24 Financial instruments

Overview The Group has transactions involving financial instruments aimed at meeting their own needs. As of September 30, 2014, the Group does not have financial instruments not recorded nor does make transactions involving financial instruments for speculation. The main risks related to the operations of the Company and its subsidiaries are as follows:

• Credit risk;

• Liquidity risk; and

• Market risk.

This note contains information on the Group's exposure to each of the abovementioned risks, the Group's objectives and the processes for measuring and managing risk and the capital management. Risk management structure The Board of Directors is responsible for following the risk management policies of the Group, and the managers of each area report on their activities to the Board of Directors.



September 30, 2014

47

The Group's risk management policies are established to identify and analyzed the risks that the Group faces, to define appropriate limits and controls of risks, and to monitor risks and adherence to the limits. The risk management policies and systems are reviewed frequently to reflect changes in the market conditions and in the activities of the Company and its subsidiaries. The Group, through its training and management rules and procedures, aims to develop a disciplined and constructive control environment, in which all the employees understand their roles and its obligations. Credit risk Credit risk is the risk of the Group incurring losses due to a client or financial instrument counterparty, resulting from failure in complying with contract obligations. Risk is mainly due to trade accounts receivable, and of financial instruments, as follows. Exposure to credit risk The carrying amounts of financial assets classified as loans and receivables represent the maximum credit exposure. The maximum credit risk exposure on balance sheet date was: Consolidated Parent company

09/30/2014 03/31/2014 09/30/2014 03/31/2014 Cash and cash equivalents 26,652 60,562 113 116 Trade accounts receivable and other receivables 37,698 32,887 1,907 41,181

64,350

93,449 2,020 41,297

Current assets (64,350) (93,449) (113) (122) Non-current assets - - 1,907 41,181 Cash and cash equivalents The Company and its subsidiaries work with a small number of financial institutions and seek to do business only with the most solid ones. In addition, another policy adopted to mitigate credit risk is to maintain investment balances proportional to the balances of the borrowings with each of these institutions. In the history of the Company and its subsidiaries, there are no records of losses on cash and cash equivalents.

Loans and receivables The exposure of the Company and its subsidiaries to credit risk is influenced, mainly, by the individual characteristics of each client. In addition, sales are evenly distributed throughout the corporate year (mainly in the crop period from March to December of each calendar year) which allows that the Company and its subsidiaries interrupt deliveries to clients which are considered as a possible credit risk.



September 30, 2014

48

Impairment losses The composition by maturity of trade accounts receivable recorded in current assets as of the financial statements for which no impairment loss was recognized was as follows. Consolidated

09/30/2014 03/31/2014 Falling due 35,557 26,372 Overdue up to 30 days 85 702 Overdue between 31 and 90 days - 3,541 Overdue over 90 days 52 638

35,694 31,253

The Company and its subsidiaries reviewed the adjustment to present value of its trade receivable balances as of September 30, 2014 and March 31, 2014 and concluded that their amounts approximate the carrying amount, since their trade receivables have a short-term turnover. The allowance for doubtful accounts is formed based on the past-due bills for over 90 days, at an amount considered adequate by the Management to cover eventual losses from the realization of trade accounts receivable. From clients that present a history of non-performance of its financial obligations, the Company and its subsidiaries seek to operate with advanced payments. Guarantees The subsidiary Vale do Tijuco Açúcar e Álcool S/A. is guarantor before the financial entities and credit cooperatives, of input purchase transactions and financing to be used in the planting and harvesting of sugarcane of its suppliers. As of September 30, 2014, the total collateralized value amounts to R$ 4,055. The subsidiary Vale do Tijuco Açúcar e Álcool S/A. will assume the debit of its suppliers up to the limit of the pledged collateral, in case of default on obligations. The occasional values disbursed by the Company to pay the obligations of suppliers, in case of default, are adjusted by the TJLP (Long-term interest rate), plus 5.5% p.a. on a pro rata basis, and will be deducted when the sugarcane is supplied by the supplier. As of September 30, 2014, the subsidiary Vale do Tijuco Açúcar e Álcool S/A. did not record the collateral at fair value, because there was no supplier in default in the Company, nor did any likelihood of the use of these collaterals by suppliers. Liquidity risk Liquidity risk is the risk of the Group encountering difficulties in performing the obligations associated with its financial liabilities that are settled with cash payments or with another financial asset. The responsibility for the management of liquidity risk lies with the Group’s management and its Board of Directors, which manages the liquidity risk in short, medium and long terms, maintaining credit lines of funding according to its cash needs, combining the profiles of its financial asset and liability maturities.



September 30, 2014

49

The book value of financial liabilities with liquidity risk is as follows: Consolidated Parent company 09/30/2014 03/31/2014 09/30/2014 03/31/2014 Loans and financing 563,977 496,746 2,570 41,370 Debentures 120,934 120,923 - - Suppliers and other accounts payable 62,987 80,165 304 101 Derivative financial instruments 10,382 6,909 - - 758,280 704,743 2,874 41,471

Current liabilities (448,211) (446,287) (304) (101) Non-current liabilities 310,069 258,456 2,570 41,370 As of September 30, 2014, the Group recorded a current liabilities balance in excess of the current assets balance by R$ 251,472. The recorded maturity of financial liabilities are as follows:

Consolidated

September 30, 2014 Book value Up to 12 months

From 1 to 2 years

From 2 to 3

years

From 3 to 4

years

From 4 to 5

years Over 5

years Loans and financing 563,977 317,730 12,600 29,751 141,287 53,129 9,480 Debentures 120,934 67,494 53,440 - - - - Suppliers and other accounts payable 62,987 62,987 - - - - - Derivative financial instruments 10,382 6,275 4,107 - - - -

Consolidated

March 31, 2014 Book value Up to 12 months

From 1 to 2 years

From 2 to 3 years

From 3 to 4

years From 4 to

5 years Over 5

years Loans and financing 496,746 338,718 62,762 59,056 23,158 12,197 855 Debentures 120,923 27,404 93,519 - - - - Suppliers and other accounts payable 80,165 80,165 - - - - - Derivative financial instruments 6,909 - 6,909 - - - -

No cash flow expected, included in the analysis of the maturation of the Group, may occur significantly sooner or in amounts significantly different. Market risk Market risk is the risk that alterations in market prices, such as exchange rates and interest rates, have in the Group's earnings, or in the value of its holdings of financial instruments. Through its activities, the Group is also exposed to financial risks arising from: change in the value of total recoverable sugar (TRS), used for calculating the fair value of the biological asset and the VHP sugar value. Interest rate risk The Group is exposed to the risks related to interest rates, in view of the loans and financing obtained, and financial investments, mainly exposed to variation of the interbank deposit certificate (CDI, in Portuguese) and long-term interest rate (TJLP, in Portuguese). The Group’s



September 30, 2014

50

management monitors the interest rate fluctuations linked to some debts, making use of derivative instruments with the purpose of minimizing the impact of these risks. Cash flow sensitivity analysis for variable rate instruments - Consolidated The sensitivity analysis is made based on the interest rates of non-derivative financial instruments in the year ended September 30, 2014. As established by CVM Instruction 475/08, which requires the presentation of two scenarios with deterioration of 25% and 50% in the variable of risk considered, we show below the possible impacts of how they would have increased (decreased) the equity and the profit or loss for the period according to the following amounts. These scenarios can produce impacts on profit or loss and future cash flows of the Group as described below:

• Scenario I: It corresponds to the scenario considered as the most probable for interest rates on the date of financial statements;

• Scenario II: Deterioration of 25% in the main risk factor of the financial instrument in relation to the level verified in the probable scenario; and

• Scenario III: Deterioration of 50% in the main risk factor of the financial instrument in relation to the level verified in the probable scenario.

Interest rate risk on financial assets and liabilities - appreciation of rates - Consolidated Interest rate risk on financial assets and liabilities - depreciation of rates - Consolidated

% Amount % Amount % Amount

Financial assets

Interest earnings bank deposits 5,774 CDI 10.81 624 13.51

156

16.21

312

Financial liabilities

Finame (32,334)

TJLP 7.47 (2,415) 9.34

(604)

11.21

(1,208)

Indirect BNDES onlending (47,303)

TJLP 4.93 (2,332) 6.16

(583)

7.40

(1,166)

Working capital (50,045)

CDI 4.06 (2,032) 5.08

(508)

6.09

(1,016)

ACC (Advance on exchange contract) (72,190)

CDI 5.82 (4,201) 7.28

(1,050)

8.73

(2,101)

(10,356)

(2,589)

(5,179)

Scenarios

InstrumentsExposure at

09/30/2014 Risk Probable

Index reduction by 25% Index variation by 50%

% Amount % Amount % Amount

Financial assets

Interest earnings bank deposits 5,774 CDI 10.81 (624) 6.84 (156)

4.56 (312)

Financial liabilities

Finame (32,334)

TJLP 7.47 2,415 5.60% 604

3.74% 1,208

Indirect BNDES onlending (47,303)

TJLP 4.93 2,332 3.70% 583

2.47% 1,166

Working capital (50,045)

CDI 4.06 2,032 3.05% 508

2.03% 1,016

ACC (Advance on exchange contract) (72,190)

CDI 5.82 4,201 4.37% 1,050

2.91% 2,101

Total 10,356

2,589

5,179

Scenarios

InstrumentsExposure at

09/30/2014 Risk Probable

Index variation by 25% Index variation by 50%



September 30, 2014

51



September 30, 2014

52

Currency risk The Group is subject to currency risk (US dollar) in part of their borrowings taken in a currency other than the functional currency. As regards other monetary assets and liabilities denominated in foreign currency, the Group guarantees that its net exposure is kept at an acceptable level, buying or selling foreign currencies at demand rates, when necessary, to address short-term instabilities. The short-term portions of the monetary liabilities denominated in foreign currency are secured by assets also denominated in foreign currency (sugar export at a price fixed in foreign currency). The long-term portion of these liabilities is secured by the Company’s sugar exports, which account for 100% of the total exports, and whose prices are fixed in foreign currency and show little sensitivity to exchange rate fluctuations. As of September 30, 2014, the Group, with a view to avoiding the effects of exchange rate changes, entered into derivative transactions for hedging purposes (swap). The impact on income (loss) as of September 30, 2014 was negative by R$ 1,545.

09/30/2014

Notional Notional Fair value Derivatives Maturity (US$ thousand) (R$ thousand) (R$ thousand) Interest rate swap Dec 2014 4,444.44 10,000 (984) Interest rate swap Nov 2015 5,451.32 12,000 (561) 9,895.76 22,000 (1,545) Exposures to exchange risks Foreign currency net exposure related to principal amounts is presented in the chart below (in US$ thousand): Consolidated 09/30/2014 03/31/2014 Cash and cash equivalents 8,751 1,287 Loans and financing (92,920) (52,227) NDF - Non-Deliverable Forward (34,700) (34,700) Net exposure (118,869) (85,640)

Sensitivity analysis – currency risk - Consolidated The sensitivity analysis is made based on the exposure of loans and financing to the monetary variation of the US dollar in the period ended September 30, 2014. As established by CVM Instruction 475/08, which requires the presentation of two scenarios with deterioration of 25% and 50% in the variable of risk considered, we show below the possible impacts of how they would have increased (decreased) the equity and the profit or loss for the period according to the following amounts. These scenarios can produce impacts on profit or loss and/or future cash flows of the Group as described below:



September 30, 2014

53

• Scenario I: For the probable scenario in US dollar the exchange rate on September 30, 2014 was considered;

• Scenario II: Deterioration of 25% in the main risk factor of the financial instrument in relation to the level verified in the probable scenario; and

• Scenario III: Deterioration of 50% in the main risk factor of the financial instrument in relation to the level verified in the probable scenario.

Information used to calculate sensitivity analyses presented above were obtained from external market sources, such as Bloomberg and BM&F Bovespa. Hedge accounting Cash flow hedge involving the Company’s exports The Group adopts a cash flow hedge accounting structure that consists of covering a highly probable expected transaction of export in foreign currency (USD), against the exchange risk of fluctuation in the exchange rate of USD in relation to BRL, using as coverage instrument the non-derivative financial instruments, such as Advance on Export Contracts (ACC, in Portuguese) and the Export Credit Note (NCE, in Portuguese) and derivatives such as Non-Deliverable Forward (NDF, in Portuguese), at amounts and maturities equivalent to exports. The relation of hedge designated to hedge accounting is as follows:

Scenarios

Financial instruments Assets

Cash and cash equivalents 8,751 20,339 5,085 10,170 (5,085) (10,170)

Liabilities

Loans and financing 92,920 218,011 54,503 109,006 (54,503) (109,006)

Total 59,588 119,176 (59,588) (119,176)

Scenarios

Liabilities Notional Fair value

NDF - Non-Deliverable Forward 34,700 8,837 2,209 4,419 (2,209) (4,419)

Total 2,209 4,419 (2,209) (4,419)

50%25%

50% 25%

50%

Consolidated

Increase (R$) Decrease (R$)

Increase (R$) Decrease (R$)

25%

50% 25%

Financial instruments USD R$

USD R$



September 30, 2014

54

The effective portion of the change in the fair value of designated derivatives and qualified as cash flow hedge, and not settled, as well as the exchange variation in non-derivative hedge instruments is recognized in equity as “Equity valuation adjustments”. This portion is realized at the time of the elimination of the risk to which the hedge instruments were designated. At the time of the settlement of financial instruments, gains and losses that were previously deferred in other comprehensive income are transferred into profit or loss. The breakdown of realized and unrealized gains and losses recognized in the operating income and in other comprehensive income, respectively of financial instruments designated as hedge instruments is as follows. Consolidated 09/30/2014 Realized Not realized

Income (loss) Shareholders'

equity ACC and NCE 552 22,783 Net exposure 552 22,783

Consolidated 09/30/2014 Realized Not realized Income (loss) Liabilities SWAP (1,045) (1,545) NDF - (8,837) Net exposure (1,045) (10,382) Current liabilities 6,275 Non-current liabilities (4,107)

Derivative financial instruments The Group is exposed to the exchange risk of future cash flows in foreign currency, in view of the income from the export of sugar. In order to mitigate this risk, the Group adopts coverage procedures based on the exchange exposure calculated by the commercial credit amount for the next 12 months, which is monthly reviewed. The coverage of the future cash flows is analyzed and discussed by the Group’s Board of Directors, which approves and authorizes the purchase and designation of derivative financial instruments for hedge accounting. The table below presents all the financial derivative transactions entered into, as well as their related fair values calculated by the Group's Management:



September 30, 2014

55

Derivatives Buy/Sold Market Contract Maturity Notional

(US$) Fair value

(R$) Term Sold CETIP NDF 04/30/2015 2,300 554 Term Sold CETIP NDF 05/31/2015 3,800 877 Term Sold CETIP NDF 06/30/2015 3,800 906 Term Sold CETIP NDF 07/31/2015 3,800 938 Term Sold CETIP NDF 08/31/2015 3,800 966 Term Sold CETIP NDF 09/30/2015 4,050 1,051 Term Sold CETIP NDF 10/31/2015 4,050 1,070 Term Sold CETIP NDF 11/30/2015 4,050 1,098 Term Sold CETIP NDF 12/31/2015 5,050 1,377 34,700 8,837

Sensitivity analysis of derivative financial instruments (consolidated) The sensitivity analysis of the change in the fair value of the derivative financial instruments of the Company in the probable, possible and remote scenarios is as follows: Interest rate risk on financial assets and liabilities - appreciation of rates - Consolidated Interest rate risk on financial assets and liabilities - depreciation of rates - Consolidated Capital management The Group manages its capital to ensure the continuity of its regular activities and, at the same time, maximizes return to all stakeholders or parties involved in its operation, through debt and equity balance optimization. The capital structure of the Group is formed by the net indebtedness, deducted of cash and bank balances, divided by the capital plus reserves. The Group is not subject to any external requirement on capital. Indebtedness ratio The Group calculates its indebtedness ratio as follows:

Instruments Exposure Risk % Amount % Amount % Amount

Swap 22,000 CDI 9.66 149 12.08 37 14.49 75 Sale commitment - NDF 34,700 Foreign exchange rate R$/US$ - 8,837 - 2,209 - 4,419

8,986 2,246 4,494

Scenarios

Increase of the index by 25%

Increase of the index by 50% Probable

Instruments Exposure Risk % Amount % Amount % Amount

Swap 22,000 CDI 9.66 (149)

7.24 (37)

4.83 (75)

Sale commitment - NDF 34,700 Foreign exchange rate R$/US$ - (8,837)

- (2,209)

- (4,419)

(8,986)

(2,246)

(4,494)

Scenarios

ProbableIndex reduction by

25%Index reduction by

50%



September 30, 2014

56

Consolidated

09/30/2014

03/31/2014 Loans and financing (563,977) (496,746) Debentures (120,934) (120,923) Cash and cash equivalents 26,652 60,562 Net debt (658,259) (557,107) Shareholders' equity 119,388 119,919 Net debt ratio (5.51) (4.65) Fair value vs. book value The book values referring to the financial instruments contained in the balance sheets, when compared with the amounts that could be obtained in their trading in an asset market or, in the absence hereof, with the net present value adjusted with a basis on the current interest rate in the market. Book value Fair value

09/30/2014 03/31/2014

09/30/2014 03/31/2014 Loans and receivables: Cash and cash equivalents 26,652 60,562 26,652 60,562 Accounts receivable and other receivables 37,698 32,887 37,698 32,887 Financial assets and liabilities valued at fair value: Derivative financial instruments (net) (10,382) (6,909) (10,382) (6,909) Financial liabilities measured at amortized cost: Suppliers (62,987) (80,165) (62,987) (80,165) Loans and financing (563,977) (496,746) (563,977) (496,746) Debentures (120,934) (120,923) (120,934) (120,923)

Classification of financial instruments The classification of financial instruments is presented in the table below, and in the understanding of the Company's Management, there are no financial instruments classified in other categories besides those informed:



September 30, 2014

57

Financial instruments by category 09/30/2014 03/31/2014

Consolidated

Fair value through

profit or loss Loans and receivables

Financial liabilities measured at

amortized cost

Fair value through

profit or loss Loans and

receivables


amortized cost Assets: Cash and cash equivalents 26,652 - - 60,562 - - Trade accounts receivable and other receivables - 37,698 - - 32,887 - Financial instruments designated to hedge: Derivative financial instruments (8,837) - - (6,508) - - Financial instruments not designated to hedge Derivative financial instruments (1,545) - - (401) - - Financial liabilities measured at amortized cost Loans and financing - - (563,977) - - (496,746) Debentures - - (120,934) - - (120,923) Suppliers and other accounts payable - - (62,987) - - (80,165)

16,270 37,698 (747,898) 53,653 32,887 (697,834) Total

09/30/2014 03/31/2014

Parent company

Fair value through

profit or loss Loans and receivables


amortized cost

Fair value through

profit or loss Loans and

receivables


amortized cost

Assets Cash and cash equivalents 113 - - 116 - - Trade accounts receivable and other receivables - 1,907 - - 41,181 - Liabilities Loans and financing - - (2,570) - - (41,370) Suppliers and other accounts payable - - (304) - - (101)

113 1,907 (2,874) 116 41,181 (41,471) Total



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Income from derivative financial instruments The Group recorded the gains and losses on these transactions in income (loss) for the year. As of September 30, 2014, the impacts recorded in profit or loss are shown below: Derivative Market Risk 09/30/2014 09/30/2013 Swap CETIP USD 1,544 - (-) Deferred income and social contribution taxes (525) - Net Effect on Company’s income (loss)

1,019 -

25 Income or loss per share

The basic income per share is calculated by dividing the income (loss) for the period attributed to the owners of common shares of the Group by the weighted average of common shares available during the period, excluding treasury shares, if any. The basic and diluted income or loss are equal, because there is no financial or equity instrument that can potentially dilute the number of shares. The tables below shows data of income and shares used in calculating basic and diluted earnings or loss per share: Parent company

09/30/2014 09/30/2013 (6 months) (6 months) Basic earnings and diluted per share: Net income for the period 14,322 9,001 Weighted average of shares 250,932,826 212,052,407 Earnings per share and diluted (in reais) 0.06 0.04

26 Operating segments The Group's management bases its reports on the financial statements on the same basis in which such information are disclosed, as these financial statements are those regularly reviewed by the chief manager of the Group for decision making about resource allocations. Therefore, the Company has only one operating segment, called “energy”.

27 Insurance coverage The Group adopts the policy of contracting insurance coverage for assets subject to risks for amounts considered to be sufficient to cover eventual casualties, considering the nature of its activity. As of September 30, 2014, the Group has insurance at amounts considered sufficient by the Management to cover possible losses, as follows:



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Insured property Amount insured Civil liability 15,000 Rural Pledge 5,856 Vehicles 100% FIPE table Machinery and equipment, sundry 35,524 Patrimonial 200,000

28 Statements of cash flows

Statements of cash flows were prepared according to technical pronouncement CPC 03 R2 and IAS 7.

a. Cash and cash equivalents Cash and cash equivalents consist of cash available in the Company and balances deposited in banks.

b. Property, plant and equipment – Consolidated During the quarter ended September 30, 2014, the subsidiaries purchased property, plant and equipment at the total cost of R$ 32,369 (R$ 14,911 as of September 30, 2013), of which R$ 10,610 by raising loans and financing (as of September 30, 2013, R$ 10,610 were by raising loans and financing and did not affect cash. Cash payments of R$ 21,759 (R$ 6,398 as of September 30, 2013) were made for cash and cash equivalents acquisition.

29 Environmental risks The facilities of the Group and its industrial and agricultural activities are subject to environmental regulations. The Group decreases the risks associated with environmental issues, through operating procedures and controls with investments in pollution control equipment and systems, besides believing that no provision for losses related to environmental issues is currently required, based on the effective laws and regulations.

30 Subsequent events On October 7, 2014, Certificates of Agribusiness Credit Rights ("CDCA") issued on September 24, 2014 in the amount of R$ 99,000 were released and will be used for the repayment of short term loans maturing in 54 installments as of its issuance date, under a fiduciary regime recorded at BM&F Bovespa and CETIP. CDCA installments will bear interest levied on an annual basis, as of the date of payment of the CRA until the respective payment date of each installment of CDCA interest, calculated on the nominal value and equivalent to 100% of accumulated average daily rates of DI over extra group - Interbank Deposits, calculated by CETIP. The following financial institutions and agents were contracted: Leading coordinating bank: BB-Banco de Investimentos S/A; issuing creditor agent: Gaia Agro Securitizadora S.A.; fiduciary agent: Planner Trustee Distribuidora de Títulos e Valores Mobiliários Ltda; registrar agent: BNY mellon Serviços Financeiros Distribuidora de Títulos e Valores Mobiliários S.A.; custodian agent: SLW Corretora de Valores de Câmbio Ltda.



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Board of Directors

Board Members

José Francisco de Fátima Santos President

Luiz Gustavo Turchetto Santos

Hansjorg Suelzle Moleonoto Tjang

Surjadi Tirtarahardia Mark Julian Wakeford

Executive Board

Carlos Eduardo Turchetto Santos Celso Oliveira

Sylvio Ortega Filho Eduardo Scandiuzzi Lopes

Accountant

Anderson César Augusto Alves

CRC/SP nº 1SP206284/O-8

Documents

Companhia Mineira de Açúcar e Álcool Participações MINEIRA DE AÇÚCAR E ÁLCOOL PARTICIPAÇÕES HARVEST 14/15 – 2Q15 Management Report Uberaba, November 14th 2014. Dear Shareholders,