Glossary

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Arbitration Chamber: Market Arbitration Chamber established by the BOVESPA for resolution of disputes between companies and its investors.

ATR: Total Recoverable Sugar.

Bagasse: Sugarcane is composed of water, fibers, sucrose and other sugars and minerals. In the milling process, the Company separates water, sugar and minerals from the fibers, or bagasse. Sugarcane bagasse is an important sugarcane byproduct and used as fuel for the boilers in the Company’s mills. Sugarcane bagasse is burned and heats the water in the boilers to high temperatures, and the resulting vapor is used to produce sugar and ethanol. Part of the vapor is also canalized for a turbo-generator that produces electricity.

BOVESPA: São Paulo Stock Exchange (Bolsa de Valores de São Paulo).

BR GAAP: Accounting practices adopted in Brazil, or Brazilian GAAP or Brazilian Corporation Law.

Carbon Credits: The sale of carbon credits is only possible for mills that generate electricity for sale to third parties. Currently, neither São Martinho mill nor Iracema mill is eligible to sell carbon credits. However, the Company expects that new Boa Vista mill to generate excess electricity that will sell to third parties, thereby qualifying the Company to sell AAUs.

Company or São Martinho: Refers to São Martinho S.A.

CBLC: The Brazilian Settlement and Custodial Company (Companhia Brasileira de Liquidação e Custódia).

CVM: The Brazilian Securities Commission (Comissão de Valores Mobiliários).

EBITDA: São Martinho defines EBITDA as its net income, adjusted for the Company’s financial income (expenses), net, income tax and social contribution, income (loss) from discontinued operations, depreciation and amortization and non-operating income (expenses), net. In calculating EBITDA, the Company does not adjust for its proportionate share of the results on derivative financial instruments to protect against sugar and ethanol price fluctuation risk. However, in calculating EBITDA, the Company has adjusted EBITDA for income (loss) from discontinued operations and non-operating income (expenses), net.

Filter Cake: is also a sub-product from processing sugarcane. It is rich in phosphorous and nitrogen. In the Company’s mills, filter cake is turned into an organic material through controlled fermentation. This organic fertilizer is used in the planting and rejuvenation of sugarcane, significantly reducing the Company’s use of commercial fertilizers.

Ribonucleic Acid (RNA): RNA production requires high technology, and therefore, RNA is a high value-added product. RNA is used in the pharmaceutical industry as a raw material and in the food industry as a flavor enhancer. Its main ingredient is molasses, a byproduct of sugar production.

Rule 144A: Rule promulgated under the U.S. Securities Act of 1933, as amended, or the Securities Act, related to qualified institutional buyers of the United States.

SEC: Securities and Exchange Commission.

Vinasse: is the liquid that results from ethanol production after distillation. Vinasse is sprayed on the sugarcane fields to fertilize and irrigate them, which is equivalent to 15 millimeters of rain. Vinasse is rich in potassium and organic matter and, when applied on the Company’s crops, reduces the use of commercial fertilizers and increases the productivity of São Martinho’s sugarcane fields.

Yeast: The Company obtains yeast from the alcoholic fermentation of sugarcane juice. It has high protein and vitamin B contents and is widely used in the composition of animal and certain human foods. São Martinho currently sell yeast directly to customers in Brazil.