Annual Report - 2018/2019 harvest

Who we are

We are Atvos, a company with more than ten years of experience in ethanol production, VHP (Very High Polarization) sugar and renewable electric power generation. We cultivate and harvest sugarcane in an area of 510 thousand hectares. We operate in four Brazilian statesGoiás, Mato Grosso, Mato Grosso do Sul and São Paulo – with nine agroindustrial units, distributed in five productive poles.

cana-de-acucar

We cultivate
and harvest
sugarcane in
an area of 510
thousand hectares
,
equivalent to the size of
three cities of São Paulo

Performance map and highlights
of the 2018/2019 harvest

Performance map

We transform sugarcane into products that generate sustainable energy to move electrical equipment, vehicles and the lives of millions of people.

Ícone representando a cana-de-açúcar
=
Ícone representando o açucar

VHP sugar

Ícone representando um bico de abastecer

Anhydrous
or hydrated ethanol

Ícone representando uma lâmpada

Electricity
generated from
sugarcane
biomass

Important themes

In the 2018/2019 harvest, our we identified the most relevant topics for our industry and business through a structured consultation process with 155 internal and external stakeholders. These themes integrate our strategy and our management and are in line with our challenges and opportunities in the short and medium terms.

Lupa

See details of our
materiality process
in the website: www.atvos.com

Materiality Matrix

Business Model

Our Business Model is the structure of our activity for sustainable growth.

Business Model

16,241 thousand ha
of preserved areas

1.5 million
tCO2 avoided

5.5 million
tCO2 avoided
by using our
products

99% of residue
co-processed,
sold,
reused
or recycled

16,120 thousand m3
of recirculated/ reused water

10,526 members
at the end of the harvest

Over
5,000 third parties

Over
600,000
men-hours
of training

4,903
members
trained in
compliance

R$4.3 billion
net revenue

R$610 million
of investments
mainly in
sugarcane
fields expansion

R$1.2 billion
in operating
cash generation

Social Energy Program – 10 years:
77 projects
155,000 people benefited
R$25.5 million invested

R$427 million
spent on
land partners

Stronger Partners:
R$565 million invested
46 partners
7.9 million tons
of cane produced

46 thousand new hectares cultivated in the harvest

4% increase in grinding losses compared to the 2017/2018 harvest

100% of harvesting operations and 96% of mechanized planting

10,842 MW of installed capacity, which represents 7,9% of sugarcane biomass fueled industries

Grinding capacity of 37 million tons of sugarcane

Capacity of:
Production
of 700 thousand

tons of VHP sugar
Production
of 3 billion
liters
of ethanol
3.1 thousand GWh
cogeneration of
electricity

Productivity

Increasing sugarcane productivity is the focus of constant attention on our business model as it directly impacts our costs, environmental aspects and the volume of ethanol, sugar and energy produced in agroindustrial units. Therefore, we seek the best agricultural techniques in order to increase the quantity and quality of sugarcane produced in each hectare.

The harvest had a great evolution: we registered a growth of 3.0% in our grinding in relation to the last harvest and reached the level of 26.7 million tons of sugarcane.

We continued our planting expansion plan and ended the harvest with 71,000 hectares, between our own and partner areas, of which 83% were renewed.

8% of growth
in the planting

26.7 million
tons of
ground sugarcane

Grinding (MM tc)

Moagem
cana-de-açúcar

Productivity

64.9
ton/ha

Açúcar

Total recoverable sugar (ATR, in Portuguese)

131.2
kg/ton

cana-de-açúcar

Tons of sugarcane per hectare (TCH, in Portuguese)

8.4
kg/ATR/ha

Compliance

At Atvos, we perceive compliance as an asset. We experience the maturity of our processes and evaluate the efficiency of our actions.

Pact for Integrity

Cumprimento

Our goal for the 2018/2019 harvest is to achieve level four maturity in ten of the 13 indicators of the Business Pact for Integrity and Against Corruption. By developing 64 actions in various areas, including cross-cutting goals, we achieved our objective.

Main highlights of the harvest

  • Apllication of the Integrity Program in the selection of member candidates.

  • Changes to our due diligence guideline to improve compliance aspects.

  • Creation of private social investment and sponsorship guidelines with clear rules.

  • Change of our entire structure to the SAP management system, which ensures greater process robustness and business security.

  • Development of conflict of interest guideline, which included training.

  • Review of the Supplier Code of Conduct.

Looking to the future

We see the opportunity to act as agents of change for a sustainable low carbon economy. One of our fronts will be to act as catalysts of Law No. 13,576/2017, the National Biofuels Policy (RenovaBio), which aims to promote the expansion of production and use of biofuels in the national energy matrix. Through this initiative, Brazil will seek to achieve the 10% reduction in CO2 emissions from the national fuel matrix.

At Atvos the preparation for RenovaBio was started on the last harvest, with a study on the carbon and water footprint of hydrous ethanol production and internal study to assess the possible impacts of carbon pricing on our revenues, our investments and our operations that pointed to opportunities for financial gains.

Advances in the harvest

  • Monitoring of the agendas related to the program

  • I-REC (Renewable Energy Certificate) Issuance of the Conquista do Portal Unit (UCP, in Portuguese)

  • Inclusion of reduction goal in the CEO’s action plan

  • Creation of an agenda with the financial area to simulate RenovaBio’s revenue impact

  • RenovaCalc manual creation, Renovabio’s carbon calculator

  • RenovaBio impact workshop for corporate office teams