Glossary

DOLLAR, DOLLARS, US$ - Official currency of the USA.

EARNINGS PER SHARE - A financial indicator defined as the ratio between the net income of a company in a determined period and the number of its shares. Earnings per share thus represent the amount of money generated as profit (or as loss) in a determined period for each share issued.

EQUITY VALUE PER SHARE (EVP) - EVP is the equity value of a share (or a lot of 1,000 shares) and is calculated by dividing shareholders’ equity by the total number of a company’ shares (or a lot of 100- shares). It is also referred to as par value or nominal value per share.

GROSS DEBT - The sum of all financial obligations (loans, debentures, etc.), of a company, whether short- or long-term.

GROSS MARGIN - The ratio between the company’s gross operating profit and its net operating revenue. Gross margin indicates the percentage of each R$ 1 gained through sales left over after deducting operating costs.

GROSS OPERATING PROFIT (GROSS PROFIT) - Net revenue minus the cost of goods sold.

MARKET CAP - What a company is currently worth on the stock market, in other words, what an investor would hypothetically pay to acquire all of the company’s shares at the current market price. This figure is obtained by multiplying the price of each type of share issued by the company by the total number of those shares.

NET DEBT - The sum of all financial obligations (loans, debentures, fixed-income securities, etc.), of a company, whether short- or long-term, minus its cash equivalents - all instruments that may be considered as paper currency.

NET MARGIN - Indicator used in the financial analysis of companies which expresses the ratio between a company’s net profit and its net operating revenue. Net margin indicates the percentage of each R$ 1 in sales left over after subtracting all expenses, including income tax, and is the ratio between net profit and net operating revenue.

NET OPERATING REVENUE - The amount of money a company actually takes in through sales of its products, in other words, gross revenue net of taxes on sales (IPI, ISS, PIS, COFINS, and others) and any discounts and rebates granted.

NET PROFIT OR LOSS - The balance remaining after subtracting income tax and various other deductions from gross profit (gross profit minus depreciation, non-operating expenses, income tax and diverse deductions). The dividend to be paid out is calculated based on net profit.

ROE (Return on Equity) - Financial analysis indicator that measures the return on capital invested by shareholders (shareholders’ equity). This indicator is the ratio between the company’s net income and its shareholders’ equity.