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5. Risk Management (Tables)
 12 Months Ended
Dec. 31, 2017
Risk Management Tables  
Exposure to exchange risk

 

  December 31, 2017 December 31, 2016
  Foreign currency R$ Foreign currency R$
         
Borrowings and financing – US$ 1,200,786 3,972,200 1,241,963 4,047,682
Borrowings and financing – Yen 57,575,271 1,692,713 57,643,930 1,609,419
Interest and charges from borrowings and financing – US$   26,628   25,114
Interest and charges from borrowings and financing – Yen   10,834      10,769   
Total exposure   5,702,375   5,692,984
Borrowing cost – US$   (26,454)   (29,650)
Borrowing cost – Yen   (3,100)      (2,971)   
Total foreign currency-denominated borrowings (Note 16)   5,672,821      5,660,363  
Borrowing and financing variable interest rate
  December 31, 2017 December 31, 2016
TR(i) 1,574,564 1,535,030
CDI(ii) 1,144,391 1,082,228
TJLP(iii) 1,354,987 1,326,631
IPCA(iv) 1,699,747 1,697,452
LIBOR(v) 2,814,399 2,906,999
Interest and charges 125,172   142,644   
Total 8,713,260    8,690,984   

 

(i) TR – Interest Benchmark Rate

(ii) CDI – (Certificado de Depósito Interbancário), an interbank deposit certificate

(iii) TJLP – (Taxa de Juros a Longo Prazo), a long-term interest rate index

(iv) IPCA – (Índice Nacional de Preços ao Consumidor Amplo), a consumer price index

(v) LIBOR – London Interbank Offered Rate

 
Credit rating
  December 31, 2017 December 31, 2016
Cash at bank and short-term bank deposits    
AA+(bra) 2,222,001 1,850,220
AAA(bra) 43,978 35,452
Other (*) 17,068  549 
  2,283,047 1,886,221

 

(*) This category includes current accounts and investment funds in banks whose balances were not significant.
Credit information of banks
Banks Fitch Moody's Standard Poor's
Banco do Brasil S/A AA+(bra) Aa1.br -
Banco Santander Brasil S/A - Aaa.br brAA-
Caixa Econômica Federal AA+(bra) Aa1.br brAA-
Banco Bradesco S/A AAA(bra) Aa1.br brAA-
Itaú Unibanco Holding S/A AAA(bra) Aa1.br brAA-
Liquidity risk
  2018 2019 2020 2021 2022 2023 onwards Total
As of December 31, 2017              
               
Liabilities              
Borrowings and financing 2,221,645 2,321,046 2,648,021 1,134,162 1,077,914 5,534,627 14,937,415
Accounts payables to suppliers and contractors 344,947 - - - - - 344,947
Services payable 408,275 - - - - - 408,275
Public-Private Partnership – PPP (*) 185,816 368,156 368,156 368,156 368,156 5,148,952 6,807,392
Program contract commitments 128,820 92,505 15,639 15,779 1,029 15,981 269,753

 

(*)The Company also considered future commitments (construction not yet performed) still not recognized in the financial statements related to São Lourenço PPP, due to the relevance of future cash flows, the impacts on its operations and the fact the Company already has formalized this commitment through an agreement signed by the parties.
Capital management
  December 31, 2017 December 31, 2016
     
Total borrowings and financing (Note 16) 12,100,966 11,964,143
(-) Cash and cash equivalents (Note 7) (2,283,047) (1,886,221)
     
Net debt 9,817,919 10,077,922
Total equity 17,513,009 15,419,211
     
Total capital 27,330,928 25,497,133
     
Leverage ratio 36% 40%
Fair value of financial instruments
  December 31, 2017 December 31, 2016
  Carrying amount Fair value Carrying amount Fair value
   Cash and cash equivalents 2,283,047 2,283,047 1,886,221 1,886,221
   Restricted cash 18,822 18,822 24,078 24,078
   Trade receivables 1,888,505 1,888,505 1,711,306 1,711,306
   Water National Agency – ANA 70,487 70,487 81,221 81,221
   Other receivables 169,715 169,715 167,369 167,369
Financial liabilities
  December 31, 2017 December 31, 2016
  Carrying amount Fair value Carrying amount Fair value
   Borrowings and financing 12,100,966 11,967,909 11,964,143 11,776,178
   Accounts payables to suppliers and contractors 344,947 344,947 311,960 311,960
   Services payable 408,275 408,275 460,054 460,054
   Program contract commitments 239,500 239,500 178,093 178,093
   Public-Private Partnership - PPP 3,071,416 3,071,416 2,249,418 2,249,418