Right-of-use assets and leases payable

12 Months Ended

Dec. 31, 2023

Right-of-use assets and leases payable

12 Right-of-use assets and leases payable

The Company and certain subsidiaries have real estate leases, substantially related to: (i) Ipiranga: fuel stations and distribution bases; (ii) Ultragaz: points of sale and bottling bases; (iii) Ultracargo: port areas and (iv) Company: offices. The Company and certain subsidiaries also have lease agreements relating to vehicles.

a. Right-of-use assets

	Weighted average useful life (years)	Balance as of 12/31/2022		Additions and remeasurement ⁽ⁱ⁾	Write-offs		Transfers ⁽ⁱⁱ⁾		Amortization		Acquisition of subsidiary ⁽ⁱⁱⁱ⁾		Balance as of 12/31/2023
Cost:
Real estate	10	2,019,898		140,245	(165,551	)	-		-		4,274		1,998,866
Port areas	29	311,174		3,790	-		-		-		-		314,964
Vehicles	4	186,455		120,705	(71,781	)	-		-		35,009		270,388
Equipment	5	26,345		12,910	(1,973	)	-		-		996		38,278
Others	20	27,846		-	-		-		-		-		27,846
		2,571,718		277,650	(239,305	)	-		-		40,279		2,650,342
Accumulated amortization:
Real estate		(634,688	)	-	95,896		(4,491	)	(209,522	)	(393	)	(753,198	)
Port areas		(36,773	)	-	-		-		(7,847	)	-		(44,620	)
Vehicles		(83,902	)	-	63,708		-		(80,661	)	(9,112	)	(109,967	)
Equipment		(2,850	)	-	1,974		-		(4,151	)	(157	)	(5,184	)
Others		(22,128	)	-	-		-		(3,719	)	-		(25,847	)
		(780,341	)	-	161,578		(4,491	)	(305,900	)	(9,662	)	(938,816	)
Net amount		1,791,377		277,650	(77,727	)	(4,491	)	(305,900	)	30,617		1,711,526

(i)	Considers R$ 257,201 referring to additions and remeasurements between right-of-use assets and leases payable.
(ii)	Refers to the amortization of the right of use, which is being capitalized as Construction in progress until the beginning of its operation.
(iii)	For further information, see Note 28.

	Weighted average useful life (years)	Balance as of 12/31/2021		Additions and remeasurement	Write-offs		Transfers		Amortization		Balance as of 12/31/2022
Cost:
Real estate	10	1,793,473		366,805	(140,380	)	-		-		2,019,898
Port areas	29	299,630		11,868	(324	)	-		-		311,174
Vehicles	4	146,173		115,666	(75,384	)	-		-		186,455
Equipment	5	16,740		9,958	(353	)	-		-		26,345
Others	20	27,846		-	-		-		-		27,846
		2,283,862		504,297	(216,441	)	-		-		2,571,718
Accumulated amortization:
Real estate		(489,470	)	-	79,003		(5,311	)	(218,910	)	(634,688	)
Port areas		(23,526	)	-	-		-		(13,247	)	(36,773	)
Vehicles		(98,867	)	-	66,554		-		(51,589	)	(83,902	)
Equipment		(1,834	)	-	399		-		(1,415	)	(2,850	)
Others		(18,870	)	-	-		-		(3,258	)	(22,128	)
		(632,567	)	-	145,956		(5,311	)	(288,419	)	(780,341	)
Net amount		1,651,295		504,297	(70,485	)	(5,311	)	(288,419	)	1,791,377

	Weighted average useful life (years)	Balance as of 12/31/2020		Additions and remeasurement		Write-offs		Transfers ⁽ⁱ⁾		Exchange rate variation		Amortization		Reclassification to assets held for sale ⁽ⁱⁱ⁾		Balance as of 12/31/2021
Cost:
Real estate	10	2,254,432		257,787		(150,718	)	-		1,295		-		(569,323	)	1,793,473
Port areas	20	268,534		31,096^(*)		-		-		-		-		-		299,630
Vehicles	4	139,843		26,589		(9,315	)	-		103		-		(11,047	)	146,173
Equipment	6	44,936		19,887		(6,171	)	-		1,920		-		(43,832	)	16,740
Others	20	27,846		-		-		-		-		-		-		27,846
		2,735,591		335,359		(166,204	)	-		3,318		-		(624,202	)	2,283,862
Accumulated amortization:
Real estate		(481,975	)	-		76,954		-		(530	)	(283,882	)	199,963		(489,470	)
Port areas		(3,962	)	-		-		(11,935	)	-		(7,629	)	-		(23,526	)
Vehicles		(63,091	)	-		7,032		-		(54	)	(48,146	)	5,392		(98,867	)
Equipment		(19,619	)	-		6,483		-		(897	)	(17,637	)	29,836		(1,834	)
Others		(16,658	)	-		-		-		-		(2,212	)	-		(18,870	)
		(585,305	)	-		90,469		(11,935	)	(1,481	)	(359,506	)	235,191		(632,567	)
Provision for impairment losses:
Real estate		-		(38,957	)	-		-		-		-		38,957		-
		-		(38,957	)	-		-		-		-		38,957		-
Net amount		2,150,286		296,402		(75,735	)	(11,935	)	1,837		(359,506	)	(350,054	)	1,651,295

b. Leases payable

The changes in leases payable are shown below:

Balance as of December 31, 2020	1,833,288
Interest accrued	147,494
Payments ⁽ⁱ⁾	(440,574	)
Additions and remeasurement	288,711
Write-offs	(83,157	)
Efffect of foreign currency exchange rate variation	16,264
Reclassification to liabilities held for sale (see note 29)	(413,715	)
Balance as of December 31, 2021	1,348,311
Interest accrued	128,069
Payments of leases	(357,879	)
Additions and remeasurement	482,439
Write-offs	(77,171	)
Balance as of December 31, 2022	1,523,769
Interest accrued	143,005
Payments of leases	(213,527	)
Interest payment	(145,586	)
Additions and remeasurement	257,201
Write-offs	(71,569	)
Acquisition of subsidiary (see notes 28.b and 28.d)	30,641
Balance as of December 31, 2023	1,523,934
Current	311,426
Non-current	1,212,508

The undiscounted future cash outflows are presented below:

	12/31/2023	12/31/2022
Up to 1 year	418,450	343,792
1 to 2 years	322,165	319,284
2 to 3 years	227,785	277,318
3 to 4 years	189,744	201,227
4 to 5 years	147,977	173,229
More than 5 years	1,003,655	1,089,255
Total	2,309,776	2,404,105

The contracts related to the leases are substantially indexed by the IGP-M (General Market Price Index is a measure of Brazilian inflation, calculated by the Getúlio Vargas Foundation).

b.1. Discount rates

The weighted nominal average discount rates for the lease contracts of the Company are:

Contracts by maturity date and discount rate
Maturity dates of the contracts	Rate (% p.a.)
From 1 to 5 years	9.40%
From 6 to 10 years	9.87%
From 11 to 15 years	10.28%
More than 15 years	10.42%

c. Lease contracts of leases of low-value assets and short-term leases

The Company and its subsidiaries, especially Cia. Ultragaz, Bahiana and IPP have operating lease contracts considered as being of low value, short term and variable payments for the use of IT equipment, vehicles and real estates. The future disbursements (payments), assumed as a result of these contracts amount approximately to:

	Up to 1 year			Between 1 and 5 years			More than 5 years			Total
12/31/2023	7,693			1,872			-			9,565

The amount of lease considered as of low value, short term and variable payments, recognized as an expense for the year ended December 31, 2023 was R$ 7,794 (R$ 18,466 for the year ended December 31, 2022 and R$ 13,524 for the year ended December 31, 2021).