Transcription

1 3M2014 REPORT

2 PAGE 2 3M2014 REPORT

3 MANAGEMENT REPORT

4 PAGE 4 3M2014 REPORT

5 01 Martifer Group

6 01 MARTIFER GROUP HIGHLIGHTS Total Operating Revenues in the 3M14 was 92.6 M Net consolidated Profit of M, registering an 11 % improvement comparing to the 1 st quarter of 2013 Total Order Book of 534 M : Metallic Construction (291 M ) and Solar (243 M ) Total Net Debt of 330 M, approx. 6 M below the consolidated debt at the end of the year MAIN FINANCIAL INDICATORS M mar-14 mar-13 Revenues EBITDA EBITDA margin 0% 2% EBIT EBIT margin -5% -2% Financial Results Profit before taxes Income tax Net Profit Attributable to non-controlling interests Attributable to shareholders per share PAGE 6 3M2014 REPORT

7 MAIN EVENTS JANUARY 2014 West Sea signs contract for the Sub-concession of Estaleiros Navais de Viana do Castelo Following an international public tender, Martifer Energy Systems and Navalria, subsidiaries of the Martifer Group, were awarded with the sub-concession for private use of public domain and of the areas allocated to the dominial concession attributed to the company Estaleiros Navais de Viana do Castelo (ENVC). Martifer Group, via its new subsidiary West Sea Estaleiros Navais, Lda., aims to develop its activity in the national and international markets and implement, in the areas included in the ENVC sub-concession, a shipbuilding and repair project, which is expected to create 400 new work places throughout the next three years. With this sub-concession, Martifer Group increases its capacity for the shipbuilding and repair. The contract was signed in January Martifer Solar USA INC and Martifer Aurora LLC begin the voluntary process for Chapter 11 On 21 January 2014 the affiliates Martifer Solar USA INC and Martifer Aurora Solar LLC started voluntary restructuring processes under Chapter 11 (US Bankruptcy Code). The affiliate companies are currently negotiating the restructuring plans, which needs to be approved by the creditors and ratified by the Court under Chapter 11, and which will permit these to continue developing their activities. FEBRUARY 2014 Martifer Renewables concludes the sale of Rosa dos Ventos On 27 of Feburary, Martifer Renewables has conclued, through its subsidiary Martifer Ronováveis Geração de Energia e Participações, S.A., controlled at 55%, the sale of 100% shares in the company Rosa dos ventos Geração e Comercialização de Energia, by the $R70.3m total amount to the brazilian company CPFL. Rosa dos ventos Geração e Comercialização de Energia SA owns the wind farm with 14.7 MW of energy cpacity. The sale agreement by both entities has been estabished on 18 June MARCH 2014 Martifer concludes two new ships for Douro Azul Navalria, Martifer s subsidiary, concluded, in March, the construction of the two hotel ships Viking Hemming and Viking Torgil, for the company Douro Azul. The ships, which will operate cruises in the Douro River, were built in one year and have a distinctive feature: a round shaped bow that allows the creation of an exterior deck with capacity for 42 passengers. Martifer Metallic Constructions restructures debt and is going to increase equity Martifer Metallic Constructions completed the conversion of part of its debt from short term to medium and long term, and equity increase of around 28 million Euros is foreseen. 3M2014 REPORT PAGE 7

8 SUBSEQUENT EVENTS ABRIL 2014 Martifer Metallic Constructions increases equity Martifer Metallic Constructions increased, via Martifer SGPS s main shareholders, its equity in around 28 million euros. Martifer Solar and Adenium Energy Capital awarded PPA for 10 MW PV plant in Jordan Martifer Solar and Adenium Energy Capital were awarded a Power Purchase Agreement (PPA) with the national utility of Jordan, NEPCO (National Electric Power Company) for a 10 MW AC solar PV plant. Martifer Solar has been selected as the lead developer and will provide engineering, procurement and construction (EPC) services. Following the connection of the plant, Martifer Solar will be responsible for the related operations and maintenance (O&M) service. Martifer Solar concludes the construction of a 78.4 MW PV portfolio for Lightsource Renewable Energy in the UK Martifer Solar concluded a 78.4 MW portfolio of photovoltaic plants in the United Kingdom. The utility-scale combined capacity consists of five plants, which are located in the counties of Cambridgeshire, Devon, Nottingham and Swindon, and was built for Lightsource Renewable Energy. Martifer SGPS, S.A. Annual General Meeting On 28 April 2014, Martifer SGPS, S.A. Annual meeting took place, with a participation of % of its total share capital, having all the proposals in the Agenda present in the Call Notice been approved by unanimity. MAY 2014 WEST SEA takes posession of the Establishment of the Sub-concession On 2 May 2014, the company West Sea - Estaleiros Navais, Lda, a part of the Martifer Group, took possession of the Subconcession, following the Sub-concession for private use of public domain and of the areas allocated to the dominial concession attributed to the company Estaleiros Navais de Viana do Castelo (ENVC). PAGE 8 3M2014 REPORT

9 02 Financial Performance

10 02 FINANCIAL PERFORMANCE RESULTS ANALYSIS M mar-14 mar-13 VAR.% Revenues % EBITDA n.m. EBITDA margin 0% 2% -2.1 pp Depreciation & Amortization % Provisions & Impairment Losses % EBIT % EBIT margin -5% -2% -2.8 pp Financial Results % Profit before taxes % Income tax n.m. Net Profit % Attributable to non-controlling interests n.m. Attributable to shareholders % per share TOTAL REVENUES In the 3M14 total revenues reached 92.6 million euros (133.1 million euros in the 3M13), 57 % of which from the Metallic construction segment, 40 % from the Solar segment and the rest from RE Developer segment. REVENUES mar-14 mar-13 M WEIGHT M WEIGHT VAR.% Martifer Consolidated % Metallic Construction % % -24% Solar % % -39% RE Developer 3.3 4% 4.3 3% -23% Others % % 79% The Group s internationalization strategy has been consolidating, and the wheight of the projects for the Portuguese market was only 22 %. PAGE 10 3M2014 REPORT

11 50% 45% 40% 35% 30% 25% 20% 15% 10% 5% 0% mar-14 mar-13 EBITDA AND NET PROFIT In the 3M14 the negative EBITDA on the Metallic construction (0.4 million euros) and solar (1.7 million euros) segments was almost totally compensated by the positive EBITDA in the RE Developer segment (1.7 million euros). EBITDA mar-14 mar-13 M MARGIN M MARGIN VAR.% Martifer Consolidated % 2.7 2% n.m. Metallic Construction % % 63% Solar % 1.4 2% n.m. RE Developer % % -34% Others n.m. Consolidated financial results were negative in 6.8 million euros, showing an improvement when compared with the 3M2013 financial results. Consolidated net profit reached million euros, showing an 11 % increase YoY. CAPEX The amount of investment in fixed assets in the 3M14 was 4 million euros, mainly resulting from the investment in the Metallic construction segment (3.4 million euros). 3M2014 REPORT PAGE 11

12 CAPEX Q2014 (M ) CAPITAL STRUCTURE ANALYSIS FINANCIAL POSITION M mar-14 dec-2013 VAR.% Fixed Assets (including Goodwill) % Other non current assets % Inventory and Receivables % Cash and cash equivalents % Assets held for sale % Total Assets % Shareholders Equity % Non-controlling interests % Total Equity % Non-current debt and leasings % Other non-current liabilities % Current debt and leasings % Other current liabilities % Liabilities related with Assets held for sale % Total Liabilities % Total assets suffered no significant changes when compared with FY2013, staying in 788 million euros, with the non -current assets value totalling 400 million euros, around 5 million euros above the value registered at the end of the year. Equity on 31 March 2014 totalled 122 million euros, which compares with 140 million euros on 31 December The negative trend results mainly from the period net profit. PAGE 12 3M2014 REPORT

13 NET DEBT Metallic Construction Solar RE Developer Holding Q2014 Note: Net Debt = Borrowings + Financial Leases (+/-) Derivatives Cash and Cash Equivalents The Group s Net Consolidated Debt at 31 March reached 330 million euros, 6 million euros below the value at the end of 2012 (336 million euros). The Group continues focused on reducing net debt, so it it is committed to the non-core asset sale process, especially of wind farms, solar projects and residually, from the sale of real estate projects, in order to achieve a debt level of 275 million euros or less by the end of TREND OF CONSOLIDATED NET DEBT (2008-1Q2014) - M Q2014 3M2014 REPORT PAGE 13

14 In the end of the 1 st Quarter of 2014, the M/L and Short Term debt structure was 31 % and 69 %, respectively, keeping the same level of the end of NET DEBT STRUCTURE SHORT AND M/L TERM MARCH 2014 Short Term M/L Term 31% 69% The M/L Term debt is almost totally (97 %) under a floating interest rate, like in the end of the year. SHORT AND M/L TERM DEBT STRUCTURE FIXED VS. FLOATING MARCH 2014 Fixed - Short Term Floating - Short Term Fixed - M/L Term Floating - M/L Term 11% 3% 89% 97% PAGE 14 3M2014 REPORT

15 03 Analisys by Segment

16 03 ANALISYS BY SEGMENT METALLIC CONSTRUCTION ACTIVITY The order book at the end of the first quarter totalled 291 million euros and is spread throughout the several geographical regions. ORDER BOOK BY GEOGRAPHY Geography Value (M ) % Western Europe % Africa 70 24% Eastern Europe and Middle East 26 9% Latin America 24 8% TOTAL % RESULTS Metallic Construction Revenues in the 3M14 reached 52.4 million euros (69.2 million euros YoY). The YoY reduction is the result of delays in the start of some projects, penalizing the performance at the beginning of 2014 and negatively affecting the operational results in the period, which presents, however, a significant improvement when compared with the same period of last year. Sales and services rendered in this segment continue focused in the external market, with Portugal representing only 19 % of the total sales. 40% 35% 30% 25% 20% 15% 10% 5% 0% mar-14 mar-13 EBITDA in the 3M14 was negative in only 0.4 million euros, increasing around 63 % YoY. Financial results have a significant influence in the net profit, representing around 66 % of the losses in the period. PAGE 16 3M2014 REPORT

17 Net Profit in the 3M14 totalled -6.4 million euros, presenting a 15 % improvement when compared with the loss registerd in the 1 st Quarter Net Financial Debt in Metallic Construction was in line with 31 st December 2013, reaching, at the end of the 1 st Quarter, 126 million euros. Total CAPEX in the 3M14 was around 3.4 million euros, which correspond essencially to the investment being made by the segment in Brazil. M mar-14 mar-13 VAR.% Revenues % EBITDA % EBITDA margin -1% -1% 0.8 pp Depreciation & Amortization % Provisions & Impairment Losses % EBIT % EBIT margin -4% -4% 0.3 pp Financial Results % Profit before taxes % Income tax % Net Profit % Attributable to non-controlling interests % Attributable to shareholders % SOLAR ACTIVITY The backlog of turnkey projects (signed) is 243 million euros, with Europe and Asia representing almost 70 % of the total value. Geography Value (M ) % Europe 87 36% Asia 80 33% America 57 23% Africa 19 8% TOTAL % 3M2014 REPORT PAGE 17

18 RESULTS Revenues in the 3M14 reduced nearly 39 % YoY, totalling 37.1 million euros versus 60.6 million euros registered in the 3M13, mainly due to the low volume of activity which usually occurs in the beginning of the year worsened by the delay in of some projects, particulary in India and the UK, which will reverse during 2014, allowing to achieve revenues above the 200 million euros. The activity in this segment continues focused on the external market, which represents more than 70 % of total sales. 70% 60% 50% 40% 30% 20% 10% mar-14 mar-13 0% EBITDA in the 3M14 was negative in 1.7 million euros with a margin around -5 % versus 2 % in 3M13. Net Financial Expenses in the 3M14 registered an improvement of around 4 % totalling 1.2 million euros versus 1.3 million euros YoY. Net Debt at the end of the 3M14 was 55 million euros, 4 million euros above the value registered at the end of M mar-14 mar-13 VAR.% Revenues % EBITDA n.m. EBITDA margin -5% 2% -6.8 pp Depreciation & Amortization % Provisions & Impairment Losses n.m. EBIT n.m. EBIT margin -6% 1% -6.8 pp Financial Results % Profit before taxes <-100% Income tax n.m. Net Profit n.m. Attributable to non-controlling interests % Attributable to shareholders n.m. PAGE 18 3M2014 REPORT

19 RE DEVELOPER ACTIVITY Martifer Renewables has currently 95 MW of wind and solar farms in operation, from which 64 MW with contribution to revenues. In Portugal, the company holds around 50 % in 31 MW of wind farms in operation, which contribute to the results through equity method. RESULTS RE Developer s total Revenues in the 3M14 reached 3.3 million euros, which compares with 4.3 million euros YoY, and result completely from the activity of the wind and solar farms in operation in the period, totalling 64 MW. EBITDA reached 1.7 million euros in the 3M14, reflecting an 8.6 pp reduction in the margin, due to the operational performance of the parks in operation. Net Profit at the end of the 3M14 was positive in 0.6 million euros, when in the 3M13 Martifer Renewables had a 0.4 million euros net profit. Net Debt at the end of the 3M14 was 2 million euros. M mar-14 mar-13 VAR.% Revenues % EBITDA % EBITDA margin 51% 59% -8.6 pp Depreciation & Amortization % Provisions & Impairment Losses % EBIT n.m. EBIT margin -2% 12% pp Financial Results n.m. Profit before taxes % Income tax n.m. Net Profit % Attributable to non-controlling interests % Attributable to shareholders % 3M2014 REPORT PAGE 19

20 PAGE 20 3M2014 REPORT

21 04 Share Price Performance

22 04 SHARE PRICE PERFORMANCE SHARE PRICE TREND Martifer PSI Source: Reuters TRADED VOLUME ( 000 shares) Source: Reuters PAGE 22 3M2014 REPORT

23 The performance of the stock markets in the 1 st Quarter 2014 was very positive, highlighting the performance of peripheral countries in Southern Europe, with performances above the European average. In fact, the index which measures the global performance of the European stocks, the EuroStoxx500, presented 4 % gains, while the Portuguese, Spanish, Greek and Italian stocks have been showing performances above the European average, with accumulated gains of 16 %, 6 %, 14 % and 13 %, respectively. At the end of the 3M14, Martifer shares gained 27.5 % with the PSI-20, Euronext Lisbon s main index, increasing approximately 16 % when compared with the end of Martifer s share price closed the 3M14 at 0.88 /share. The maximum price achieved was 1.20 /share and minimum 0.68 /share. The average volume of stocks traded daily during the 3M14 was 124,224 shares, which translates a significant increase when compared with the average volume registered in the 3M13, of 39,984 shares. Martifer s market value at 31 March 2014 was 88 million euros. 3M2014 REPORT PAGE 23

24 PAGE 24 3M2014 REPORT

25 INTERIM CONSOLIDATED FINANCIAL INFORMATION

26 PAGE 26 3M2014 REPORT

27 05 Interim Consolidated Financial Statements

28 05 INTERIM CONSOLIDATED FINANCIAL STATEMENTS CONSOLIDATED INCOME STATEMENTS FOR THE 3 MONTH PERIODS ENDED 31 MARCH OF 2014 AND 2013 (amounts expressed in Euro) (Translation of consolidated financial statements originally issued in Portuguese - note 30) NOTES 3M' 2014 (NON AUDITED) 3M' 2013 (NON AUDITED) Sales and services rendered 3 and 4 85,997, ,279,990 Other income 5 6,634,544 6,731,301 Cost of goods sold 6 (31,521,772) (48,330,282) Subcontractors 7 (19,616,962) (38,255,801) External supplies and services 8 (19,073,803) (17,399,470) Staff costs 9 (18,980,857) (20,570,677) Other operational gains and losses 10 (3,506,757) (5,833,539) (68,442) 2,621,522 Amortizations 3 (4,470,522) (4,462,855) Provisions (4,195) (396,616) Impairment losses (38,692) (621,068) Operating income (4,581,851) (2,859,017) Financial income 11 2,186,251 3,667,979 Financial expenses 11 (9,457,788) (11,094,812) Gains / (losses) on associate companies and joint arrangements ,206 (3,761,270) Profit before tax (11,429,182) (14,047,121) Income tax 13 (963,522) 21,689 Profit after tax (12,392,704) (14,025,432) Earnings of the disposal group classified as held for sale - 158,086 Attributable to: non-controlling interests - - owners of Martifer - 158,086 Profit for the year (12,392,704) (13,867,346) Attributable to: non-controlling interests 20 (2,063,347) 287,823 owners of Martifer (10,329,356) (14,155,169) Earnings per share: Basic 14 (0.1055) (0.1448) from continuing operations (0.1055) (0.1464) from disposal group classified as held for sale Diluted 14 (0.1055) (0.1448) from continuing operations (0.1055) (0.1464) from disposal group classified as held for sale The accompanying notes are part of these financial statements PAGE 28 3M2014 REPORT

29 CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME FOR THE 3 MONTH PERIODS ENDED 31 MARCH OF 2014 E 2013 (amounts expressed in Euro) (Translation of consolidated financial statements originally issued in Portuguese - note 30) 3M' 2014 (NON AUDITED) 3M' 2013 (NON AUDITED) Profit for the year (12,392,704) (13,867,346) Fair value of cash flow hedges (derivatives), net of tax (156,112) 493,090 Exchange differences arising on (i) translating foreign operations; (ii) net investment in subsidiaries and (iii) goodwill (51,289) (98,084) Income recognized directly in equity (207,401) 395,006 Total comprehensive income for the period (12,600,105) (13,472,340) Attributable to: non-controlling interests (2,187,305) 348,482 owners of Martifer (10,412,799) (13,820,821) The accompanying notes are part of these financial statements 3M2014 REPORT PAGE 29

30 CONSOLIDATED STATEMENTS OF FINANCIAL POSITION AT 31 MARCH 2014 AND 31 DECEMBER 2013 (amounts expressed in Euro) (Translation of consolidated financial statements originally issued in Portuguese - note 30) ASSETS NOTES 31 MARCH 2014 (NON AUDITED) 31 DECEMBER 2013 (AUDITED) Non-current assets Goodwill 12,909,510 12,909,431 Intangible assets 7,044,709 7,503,472 Tangible assets 214,256, ,544,798 Investment property 16,200,704 16,195,865 Financial assets under the equity method 15 41,475,206 41,282,069 Available for sale investments 16 1,309, ,621 Other non-current receivables 17 92,378,856 92,479,001 Deferred tax assets 14,507,052 14,360, ,081, ,850,389 Current assets Inventories 26,769,791 26,515,807 Trade receivables ,291, ,615,674 Other receivables 17 52,536,448 51,455,759 Income tax 1,800,000 1,779,777 Current tax assets 18,492,477 17,396,316 Other current assets ,551, ,115,097 Cash and cash equivalentes 49,582,358 38,843,709 Derivatives 212, ,468 Assets held for sale 19 31,871,425 30,812, ,108, ,922,655 Total assets 788,189, ,773,044 EQUITY Issued capital 20 50,000,000 50,000,000 Share premium 186,500, ,500,000 Treasury stock (2,868,519) (2,868,519) Reserves (136,671,979) (64,654,736) Profit for the year (10,329,356) (68,961,164) Equity attributable to owners of Martifer 86,630, ,015,581 Non-controlling interests 20 32,542,310 36,784,990 Non-controlling interests attributable to Assets held for sale 19 and 20 3,080,394 2,891,441 Total equity 122,252, ,692,012 LIABILITIES Non-current liabilities Borrowings ,292, ,842,770 Obligation under finance leases 13,751,811 13,917,683 Other non-current liabilities 22 13,777,721 13,725,090 Provisions 23 22,173,673 22,326,882 Deferred tax liabilities 2,234,829 1,494, ,230, ,307,094 Current liabilities Borrowings ,102, ,751,722 Obligation under finance leases 4,312,610 4,357,014 Trade payables ,446, ,031,422 Other payables 22 56,254,014 28,851,369 Income tax 2,403,110 3,278,785 Current tax liabilities 17,923,178 15,325,642 Other current liabilities 24 49,631,689 46,827,457 Derivatives 126, ,254 Liabilities related with Assets held for sale 19 11,506,389 11,186, ,705, ,773,938 Total liabilities 665,936, ,081,032 Total equity and liabilities 788,189, ,773,044 The accompanying notes are part of these financial statements PAGE 30 3M2014 REPORT

31 CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY FOR THE 3 MONTH PERIODS ENDED 31 MARCH OF 2014 AND 2013 (amounts expressed in Euro) (Translation of consolidated financial statements originally issued in Portuguese - note 30) FAIR VALUE FOREIGN EQUITY RESERVES NON- ISSUED SHARE TREASURY CURRENCY OTHER NET PROFIT ATTRIBUTABLE TO TOTAL CASH FLOW CONTROLLING CAPITAL PREMIUM STOCK TRANSLATION RESERVES OF THE YEAR OWNERS OF THE EQUITY HEDGE INTERESTS RESERVES PARENT DERIVATIVES Balance at 1 January ,000, ,500,000 (2,868,519) (902,433) (18,903,670) 18,306,920 (55,852,988) 176,279,310 50,975, ,255,223 Appropriation of the profit of (55,852,988) 55,852, Comprehensive income for the year: Profit for the year (14,155,169) (14,155,169) 287,823 (13,867,346) Exchange differences arising on (i) translating foreign operations and (ii) net investment in subsidiaries (484,462) - - (484,462) 32,135 (452,327) Exchange differences arising on goodwill , ,975 7, ,243 Other changes in equity of subsidiaries , ,835 21, ,090 Total comprehensive income for the year ,835 (137,487) - (14,155,169) (13,820,821) 348,482 (13,472,340) Other changes in equity of subsidiaries ,454,215-1,454,215 1,798,347 3,252,562 Changes in the consolidation perimeter (41,915) - (41,915) (75,706) (117,621) Non-controlling interests transactions (934,350) - (934,350) (71,870) (1,006,219) Balance at 31 March ,000, ,500,000 (2,868,519) (430,598) (19,041,158) (37,068,117) (14,155,169) 162,936,440 52,975, ,911,605 Balance at 1 January ,000, ,500,000 (2,868,519) 307,575 (21,990,557) (42,971,754) (68,961,164) 100,015,581 39,676, ,692,012 Appropriation of the profit of (68,961,164) 68,961, Comprehensive income for the year: Profit for the year (10,329,356) (10,329,356) (2,063,347) (12,392,703) Exchange differences arising on (i) translating foreign operations and (ii) net investment in subsidiaries , ,669 (123,958) (51,289) Other changes in equity of subsidiaries (156,112) (156,112) - (156,112) Total comprehensive income for the year (156,112) 72,669 - (10,329,356) (10,412,798) (2,187,305) (12,600,104) Other changes in equity of subsidiaries (2,972,637) - (2,972,637) (1,866,422) (4,839,058) Balance at 31 March ,000, ,500,000 (2,868,519) 151,463 (21,917,888) (114,905,555) (10,329,356) 86,630,146 35,622, ,252,850 The accompanying notes are part of these financial statements 3M2014 REPORT PAGE 31

32 CONSOLIDATED STATEMENTS OF CASH FLOWS FOR THE 3 MONTH PERIODS ENDED 31 MARCH OF 2014 AND 2013 (amounts expressed in Euro) (Translation of consolidated financial statements originally issued in Portuguese - note 30) 3M' 2014 (NON AUDITED) 3M' 2013 (NON AUDITED) OPERATING ACTIVITIES Receipts from customers 133,897, ,257,566 Payments to suppliers (100,006,965) (131,893,836) Payments to employees (17,719,921) (19,575,072) Cash generated from operations 16,170,648 2,788,658 Income tax paid (1,284,383) 737,446 Other receipts/(payments) relating to operating activities (969,039) 660,151 Cash generated from other operating activities (2,253,422) 1,397,596 Net cash generated by operating activities (1) 13,917,226 4,186,255 INVESTING ACTIVITIES Receipts arising from: Financial assets - 137,780 Intangible assets 245,845 2,164 Tangible assets 2,595, ,743 Investment grants 5,505 - Interest and similar income 354, ,929 Others 355,795 61,859 3,557,695 1,642,475 Payments arising from: Financial assets - (500,000) Tangible assets (4,373,163) (2,926,165) Intangible assets (190,391) (4,638,929) Others (279,569) (1,598) (4,843,123) (8,066,692) Net cash generated by investing activities (2) (1,285,428) (6,424,218) FINANCING ACTIVITIES Receipts arising from: Borrowings 118,519,758 91,532,067 Others 1,235, , ,755,002 92,036,391 Payments arising from: Borrowings (113,719,131) (87,760,785) Leasings (210,276) (766,539) Interest and similar costs (6,723,429) (5,263,207) Others (1,409,163) (534,913) (122,061,999) (94,325,444) Net cash generated by financing activities (3) (2,306,997) (2,289,053) Net increase in cash and cash equivalents (4)=(1)+(2)+(3) 10,324,801 (4,527,016) Changes in the consolidation perimeter and others - (453,779) Effect of foreign exchange currencies 413,848 (25,906) Cash and cash equivalents at the beginning of the period 38,843,709 38,024,569 Cash and cash equivalents at the end of the period 49,582,358 33,017,868 The accompanying notes are part of these financial statements PAGE 32 3M2014 REPORT

33 06 Notes to Interim Consolidated Financial Statements

34 06 NOTES TO INTERIM CONSOLIDATED FINANCIAL STATEMENTS INTRODUCTORY NOTE Martifer SGPS, S.A., with its head-office at Zona Industrial, Apartado 17, Oliveira de Frades Portugal ( Martifer SGPS or the Company ), and its group of companies ( Group ), have as its main activity the construction of steel infrastructures and solar activity - which focuses on the development of photovoltaic projects, the installation of turnkey photovoltaic parks or under the EPC and the development of architectural integration projects and microgeneration. They also have other activities which highlight the promotion and development of renewable energy projects (Note 3). Martifer SGPS was incorporated on 29 October 2004, its share capital having been realized through the delivery of shares, valued at its market value, that the shareholders held in Martifer - Construções, S.A., a company that was incorporated in 1990 and which, at that time, was the holding company of the current Martifer Group. As of June 2007, after the initial public offering Martifer SGPS, S.A. shares have been listed on Euronext Lisbon. At 31 March 2014, the Group has developed its activity in Portugal, Spain, Slovakia, Romania, Czech Republic, Angola, Brazil, Greece, United States of America, Mozambique, Ireland, Italy, Belgium, Bulgaria, Netherlands, France, Morocco, United Kingdom, Canada, Mexico, Saudi Arabia, Germany, Chile, Ecuador, Ukraine, Turkey, Senegal, Singapore, India, Malta and Japan. The accompanying notes were selected to help the understanding of the more significant changes in the financial position and the financial performance of the Group since the last annual reporting, dated of 31 December All the amounts presented in these notes are expressed in Euros (rounded at unit), unless otherwise stated. These consolidated financial statements are not audited. 1. SIGNIFICANT ACCOUNTING POLICIES BASIS OF PREPARATION These accompanying consolidated financial statements relate to the consolidated financial statements of the Martifer Group and were prepared in accordance with the International Financial Reporting Standards ( IFRS ), as adopted by the European Union, in force at the beginning of the economic period started 1 January These are the International Financial Reporting Standards, issued by the International Accounting Standards Board ("IASB"), and interpretations issued by the International Financial Reporting Interpretations Committee ("IFRIC") or by the previous Standing Interpretations Committee ("SIC"), that have been endorsed by the European Union. The interim consolidated financial report for the period ended at 31 March 2014 has been prepared in accordance with IAS 34 - Interim Financial Reporting as adopted by the European Union. These consolidated financial statements have been prepared on a going concern basis from the books and accounting records of the companies included in the consolidation (Note 2) and have been prepared under the historical cost convention, except for the revaluation of certain financial instruments, which are stated at fair value. The accounting policies adopted are consistent with those considered in the financial statements for the year ended as of 31 December 2013 and disclosed in the corresponding notes. The amendments or new International Financial Reporting Standards (IFRS) and/or Interpretations issued or entering into force during the period ended in 31 March 2014 had no significant impact on the Group s consolidated financial statements. The consolidated financial statements were presented in Euros since this is the main currency of the Group s operations. In the preparation of the consolidated financial statements, in accordance with the IAS/IFRS, the Group s Board of Directors adopted certain assumptions and estimations that affect the assets and liabilities reported, as well as the profits and losses incurred related to the reported periods. All the estimations and assumptions of the Board of Directors were performed taking into consideration the best knowledge available at the financial statements approval date of the events and the dealings in progress. PAGE 34 3M2014 REPORT

35 2. GROUP COMPANIES INCLUDED IN THE CONSOLIDATED FINANCIAL STATEMENTS Group companies included in the consolidated financial statements, their consolidation methods, head offices and percentage of share capital held by the Group, at 31 March 2014 are as follows: COMPANIES CONSOLIDATED THROUGH THE FULL CONSOLIDATION METHOD PERCENTAGE OF SHARE CAPITAL HELD COMPANY HEAD OFFICE DESIGNATION DIRECTLY INDIRECTLY TOTAL Martifer SGPS, S.A. Oliveira de Frades Martifer SGPS Holding Martifer Inovação e Gestão, S.A. Oliveira de Frades Martifer Inovação % % Martifer Gestiune Si Servicii, S.R.L. Bucharest Martifer Inovação Roménia % % Martifer Metallic Constructions SGPS, S.A. Oliveira de Frades Martifer Metallic Constructions % % Martifer - Construções Metalomecânicas, S.A. Oliveira de Frades Martifer Construções % % Martifer Mota-Engil Coffey Construction Joint Venture Limited Dublin MMECC % 60.00% Martifer Construcciones Metálicas España, S.A. Madrid Martifer Espanha % % Martifer Construções Metálicas Angola, S.A. Luanda Martifer Angola % 78.75% Martifer Construction Limited Dublin Martifer Irlanda % % Martifer Polska Sp. Zo.o. Gliwice Martifer Polska % % Martifer Constructions, SAS Rungis Martifer França % % Martifer Constructii SRL Bucharest Martifer Constructii % % Park Logistyczny Biskupice Gliwice Biskupice % % Martifer Konstrukcje Sp. Z o.o. Gliwice Martifer Konstrukcje % % Martifer Slovakia S.R.O. Bratislava Martifer Slovakia % % Sociedade de Madeiras do Vouga, S.A. Albergaria-a-Velha Madeiras do Vouga % % Martifer - Gestão de Investimentos, S.A. Oliveira de Frades MGI % % Nagatel Viseu, Promoção Imobiliária, S.A. Oliveira de Frades Nagatel Viseu % % Martifer Retail & Warehousing Angola, S.A. Luanda Martifer Retail Angola % % Martifer - Alumínios, S.A. Oliveira de Frades Martifer Alumínios % % Martifer Alumínios Angola, S.A. Luanda Martifer Alumínios Angola % % Martifer Aluminium Pty, Ltd Sidney Sassall % % Martifer Aluminium Limited Dublin Martifer Aluminium Irlanda % % Martifer Aluminium UK Limited London Martifer Aluminium Reino Unido % % Martifer Aluminium SAS Rungis Martifer Aluminium França % % Martifer Alumínios Ltda São Paulo Martifer Alumínios Brasil % 99.99% Martifer UK Limited London Martifer UK % % MT Construction Maroc, S.A.R.L. Tânger Martifer Marrocos % % Martifer - Construções Metálicas, Ltda. Fortaleza Martifer Brasil % 99.80% Saudi Martifer Constructions LLC Riyadh Martifer Arábia Saudita % % Martifer Beteiligungsverwaltungs GmbH Vienna Martifer GmbH % % M City Gliwice Sp. Zo.o Gliwice M City Gliwice % % Martifer Energy Systems II, SGPS, S.A. Oliveira de Frades Martifer Energy Systems II % % Martifer Energia S.R.L. Bucharest Martifer Energia Roménia % % Martifer Energia LLC Kiev Martifer Energia Ucrânia % % Martifer Wind Energy Systems LLC San Angelo TX Martifer Wind USA % % Martifer Energy Systems PTY Cape City Martifer Energia África do Sul % 85.00% Navalria Docas, Construções e Reparações Navais, S.A. Aveiro Navalria % % Gebox, S.A. Ílhavo Gebox % % West Sea - Estaleiros Navais, Lda. Oliveira de Frades West Sea % % Martifer Global SGPS, S.A. Oliveira de Frades Martifer Global % % Martifer Construcciones Peru, S.A. Lima Martifer Peru % % Global Holding Limited Zebbug Global Holding Limited % % 3M2014 REPORT PAGE 35

36 PERCENTAGE OF SHARE CAPITAL HELD COMPANY HEAD OFFICE DESIGNATION DIRECTLY INDIRECTLY TOTAL Global Engineering & Construction Limited Zebbug Global Engineering % % Martifer Solar SGPS, S.A. Oliveira de Frades Martifer Solar SGPS % % Martifer Solar, S.A. Oliveira de Frades Martifer Solar % 55.00% Martifer Solar Sistemas Solares, S.A. Madrid Martifer Solar Sistemas Solares % 55.00% Solar Parks Construccion Parques Solares ETVE, S.A. Madrid Solar Parks % 55.00% Parque Solar Seseña III, S.L. Madrid Seseña III % 55.00% MTS Solar Sistemas Solares, S.A. Mexico City Martifer Solar México % 54.45% Martifer Solar Chile Holding, Lda Santiago do Chile Martifer Solar Chile % 55.00% Martifer Solar Chile Operaciones Limitada Santiago do Chile Solar Chile Operaciones % 55.00% Martifer Solar Sistemas Solares Equador S.A. Sangolquí Martifer Solar Equador % 54.45% Martifer Solar Servicios Mexico Mexico City Martifer Solar Servicios Mexico % 55.00% Martifer Solar S.R.L. Milão Martifer Solar Itália % 55.00% MTS1 S.R.L. Syracuse MTS % 55.00% MTS2 S.R.L. Syracuse MTS % 55.00% MTS3 S.R.L. Syracuse MTS % 55.00% Martifer Solar RO S.R.L. Bucharest Martifer Solar Roménia % 55.00% Martifer Solar Inc. S. Francisco CA Martifer Inc % 55.00% Martifer Solar USA, Inc. Santa Monica CA AEM % 54.61% Martifer Aurora Solar, LLC Santa Monica CA Solar Aurora 1) % 54.07% MT Silverado Fund I LLC S. Francisco CA Silverado 1) % 31.42% Martifer Solar Finance LLC S. Francisco CA Martifer Solar Finance % 55.00% Martifer Solar Hellas, A.T.E. Athens PVI 1) % 39.13% Martifer Solar Angola Luanda Martifer Solar Angola 1) % 41.25% Martifer Solar N.V. Deerlijk Martifer Solar Bélgica % 55.00% Martifer Solar UK Limited London Martifer Solar UK % 55.00% Martifer Solar S.A.S. Lyon Martifer Solar França % 55.00% Martifer Solar CZ Praga Martifer Solar República Checa % 55.00% Home Energy France SAS Lyon Home Energy França % 55.00% PVGlass S.r.l Milão PVGlass Itália % 55.00% MPrime Solar Solutions, S.A. Oliveira de Frades Mprime % 55.00% MPrime GMBH Munique MPrime GMBH % 55.00% Sol Cativante, Lda. Sever do Vouga Sol Cativante % 55.00% Martifer Solar Investments, B.V. Amsterdam Martifer Solar Holanda % 55.00% Martifer Solar Canadá, Ltd. Toronto Martifer Solar Canadá % 55.00% MTS6 S.R.L. Syracuse MTS % 55.00% Martifer Solar SK s.r.o. Dolny Kubin Martifer Solar Eslováquia % 55.00% Ginosa Solar Farm, S.R.L. Roma Ginosa Solar Farm % 55.00% Solar Spritehood S.R.L Roma Solar Spritehood % 55.00% MTS7, S.R.L. Roma MTS % 55.00% Canopy - Naos Paris Canopy Naos % 55.00% Steadfast Fairview Solar, Ltd Andover Steadfast Fairview Solar % 55.00% Steadfast Molland Solar, Ltd Andover Steadfast Molland Solar % 55.00% Martifer Solar UA, LLC Kyiv Martifer Solar Ucrânia % 55.00% Inspira Martifer Solar Limited Mumbai Inspira Martifer Solar 1) % 28.05% Societé Developpement Local SA Dakar Martifer Solar Senegal 1) % 28.05% Martimak Solar Besiktas Martimak 1) % 44.00% Martiper Solar Besiktas Martiper 1) % 44.00% Martifer Solar Singapura PTE. LTD. Singapura Martifer Solar Singapura % 55.00% Martifer Solar Japan KK Tóquio Martifer Solar Japan % 55.00% EVIVA SOLAR 1 LTD Athens Eviva Solar % 54.90% EVIVA SOLAR 2 LTD Athens Eviva Solar % 54.90% MTS Francis Court Solar Limited London MTS Francis 3) % 55.00% MTS Tonge Solar Limited London MTS Tonge % 55.00% MTS Rydon Solar Limited London MTS Rydon % 55.00% Martifer Solar MZ, S.A. Maputo Martifer Solar 1) Moçambique % 28.05% Greencoverage Unipessoal, Lda. Oliveira de Frades Greencoverage % 55.00% Martifer Solar, Ltda Pindamonhangaba Martifer Solar Brasil % 54.45% PAGE 36 3M2014 REPORT

37 PERCENTAGE OF SHARE CAPITAL HELD COMPANY HEAD OFFICE DESIGNATION DIRECTLY INDIRECTLY TOTAL Visiontera Unipessoal, Lda Oliveira de Frades Visiontera % 55.00% Inovsun, Lda. Oliveira de Frades Inovsun % 55.00% Martifer Solar Middle East Dubai Martifer Solar Middle East % 55.00% Belive in Bright Unipessoal, LDA. Oliveira de Frades Belive in Bright % 55.00% Montidílico Unipessoal, LDA. Oliveira de Frades Montidílico % 55.00% Martifer Renewables SGPS, S.A. Oliveira de Frades Martifer Renewables SGPS % % Martifer Renewables, S.A. Oliveira de Frades Martifer Renewables SA % % Martifer Renovables ETVE, S.A.U. Madrid Martifer Renovables % % Eurocab FV 1 S.L. Madrid Eurocab % % Eurocab FV 2 S.L. Madrid Eurocab % % Eurocab FV 3 S.L. Madrid Eurocab % % Eurocab FV 4 S.L. Madrid Eurocab % % Eurocab FV 5 S.L. Madrid Eurocab % % Eurocab FV 6 S.L. Madrid Eurocab % % Eurocab FV 7 S.L. Madrid Eurocab % % Eurocab FV 8 S.L. Madrid Eurocab % % Eurocab FV 9 S.L. Madrid Eurocab % % Eurocab FV 10 S.L. Madrid Eurocab % % Eurocab FV 11 S.L. Madrid Eurocab % % Eurocab FV 12 S.L. Madrid Eurocab % % Eurocab FV 13 S.L. Madrid Eurocab % % Eurocab FV 14 S.L. Madrid Eurocab % % Eurocab FV 15 S.L. Madrid Eurocab % % Eurocab FV 16 S.L. Madrid Eurocab % % Eurocab FV 17 S.L. Madrid Eurocab % % Eurocab FV 18 S.L. Madrid Eurocab % % Eurocab FV 19 S.L. Madrid Eurocab % % Eviva Energy S.R.L. Bucharest Eviva Roménia % % Eviva Nalbant S.R.O. Bucharest Eviva Nalbant % % Eviva Agighiol S.R.L. Bucharest Eviva Agighiol % 99.00% Eviva Casimcea S.R.O. Bucharest Eviva Casimcea % 99.00% Premium Management Consulting, S.R.L. Bucharest Premium Management % 85.00% MW Topolog, S.R.L. Bucharest MW Topolog % 99.00% Martifer Renewables, S.A. Gliwice Eviva Polónia % % Martifer Renewables Pty, Ltd. Sidney Eviva Austrália % % Eviva Beteiligungsverwaltungs GmbH Vienna Eviva GmbH % % Eviva Hidro S.R.L. Bucharest Eviva Hidro 1.00% 99.00% % Martifer Deutschland GmbH Berlin Martifer Deutschland % % Wind Farm Odrzechowa Sp. Zo.o Gliwice Wind Odrzechowa % % Eviva Gizalki Sp. Zo.o Miastko Eviva Gizalki % % Wind Farm Bukowsko Sp. Zo.o Gliwice Wind Farm Bukowsko % % Wind Farm Markowa Sp. Zo.o Gliwice Wind Farm Markowa % % Wind Farm Lada Sp. Zo.o Gliwice Wind Farm Lada % % Wind Farm Jawornik Sp. Zo.o Gliwice Wind Farm Jawornik % % Wind Farm Piersno Sp. Zo.o Gliwice Wind Farm Piersno % % Wind Farm Oborniki Sp. Zo.o Gliwice Wind Farm Oborniki % % Martifer Renewables Brazil B.V. Amsterdam Renewables Holanda % % Vesto EAD Varna Vesto % % DVP1 Limited Varna DVP % % DVP2 Limited Varna DVP % % Martifer Renewables Investments ETVE, S.A. Madrid Eurocab % % Martifer Renewables Italy BV Amsterdam Renewables Italy Holanda % % Martifer Renewables Brasil Participações LTDA Fortaleza Martifer Renewables Brasil % % Martifer Renováveis - Geração de Energia e Participações S.A. Fortaleza Ventania % 55.00% Eólica Cajueiro da Praia, Ltda. Fortaleza Cajueiro % 55.00% Eólica Coqueirais, Ltda. Fortaleza Cacimbas % 55.00% SBER Sociedade Brasileira de Energias Renováveis, Ltda. Fortaleza SBER 1) % 41.25% 3M2014 REPORT PAGE 37

38 PERCENTAGE OF SHARE CAPITAL HELD COMPANY HEAD OFFICE DESIGNATION DIRECTLY INDIRECTLY TOTAL Melosa Geração de Energia e Participações, Ltda. Fortaleza Melosa % 55.00% Eólica Paraipaba, Ltda. Fortaleza Paraipaba % 55.00% Eólica Chapadão, Ltda. Fortaleza Chapadão % 55.00% Rosa dos Ventos - Geração e Comercialização de Energia, S.A Fortaleza Rosa dos Ventos 2) % 55.00% Eólica Macaúbas, Ltda. Fortaleza Macaúbas % 54.99% Eólica Sobradinho, Ltda. Fortaleza Sobradinho % 54.99% MSPAR Energia e Participações, SA Barueri MSPAR % 55.00% Martifer Renewables O&M Sp. z o.o. Gliwice Martifer Renewables O&M % 52.00% 1) The consolidation of these companies using the full consolidation method is a consequence of the Group having stepped shareholdings, but exercising control at each level. 2) This company was classified as an Assets held for sale (Note 19). 3) Its prior designation was MTS Downs Farm Solar Limited. COMPANIES CONSOLIDATED THROUGH THE EQUITY METHOD PERCENTAGE OF SHARE CAPITAL HELD COMPANY HEAD OFFICE DESIGNATION DIRECTLY INDIRECTLY TOTAL Metallic Construction Associate companies: Liszki Green Park, Sp. Zo.o Gliwice Liszki Green Park % 45.00% Martifer Amal, S.A. Nacala Martifer Amal % 35.00% Martifer Amal, S.A. Oliveira de Frades Martifer Amal % 30.00% Joint control companies: Promoquatro Investimentos Imobiliários, Lda. Oliveira de Frades Promoquatro % 50.00% M City Bialystok Sp. Zo.o Gliwice M City Bialystok % 50.00% M City Radom Sp. Zo.o Gliwice M City Radom % 50.00% M. City Szczecin Sp. Z o.o. Gliwice M City Szczecin % 50.00% Solar Associate companies: Parque Solar Seseña I, S.L. Madrid Seseña I % 20.63% Canaverosa Renovables, SL Madrid Canaverosa % 26.94% Empresa de Energia Renovable Maria del Sol Norte S.A. Santiago Maria del Sol % 26.95% MSN Solar Uno SpA Santiago MSN Solar Uno % 26.95% MSN Solar Dos SpA Santiago MSN Solar Dos % 26.95% MSN Solar Tres SpA Santiago MSN Solar Tres % 26.95% MSN Solar Cuatro SpA Santiago MSN Solar Cuatro % 26.95% MSN Solar Cinco SpA Santiago MSN Solar Cinco % 26.95% FTP Solar LLC New York FTP Solar % 20.57% Outros Associate companies: Nutre SGPS, S.A. Oliveira de Frades Prio SGPS 49,00% % Nutre, S.A. Oliveira de Frades Prio Foods % 49.00% Nutre - Industrias Alimentares, S.A. Oliveira de Frades Prio Alimentar % 49.00% Nutre MZ. S.A. Maputo Nutre Moçambique % 49.00% Nutre Farming, S.R.L. Bucharest Nutre Farming Roménia % 49.00% Prio Agromart S.R.L. Bucharest Prio Agromart % 49.00% Prio Balta S.R.L. Bucharest Prio Balta % 49.00% Prio Facaieni S.R.L. Bucharest Prio Facaieni % 49.00% Prio Ialomita S.R.L. Bucharest Prio Ialomita % 49.00% Prio Rapita S.R.L. Bucharest Prio Rapita % 49.00% Nutre Farming West Part S.R.L. Bucharest Nutre West Part % 49.00% Prio Terra Agricola S.R.L. Bucharest Prio Terra Agricola % 49.00% Prio Turism Rural S.R.L Bucharest Prio Turism Rural % 49.00% Agromec Balaciu Bucharest Agromec Balaciu % 42.60% Miharox S.R.L. Bucharest Miharox % 40.47% Zimbrul. S.A. Bucharest Zimbrul % 49.00% PAGE 38 3M2014 REPORT

39 PERCENTAGE OF SHARE CAPITAL HELD COMPANY HEAD OFFICE DESIGNATION DIRECTLY INDIRECTLY TOTAL Agrozootehnica. S.A. Bucharest Agrozootehnica % 48.98% Prio Agrotrans S.R.L. Bucharest Prio Agrotrans % 49.00% Nutre Brasil LTDA S. Luís do Maranhão Prio Foods Brasil % 49.00% Prio Extractie S.R.L. Bucharest Prio Extractie % 22.05% Prio Agro Industries. Sp. Z o.o. Gliwice Prio Polónia % 49.00% Prio Biocombustibil S.R.L. Bucharest Prio Biocombustibil % 22.05% Prio Meat S.R.L Bucharest Prio Meat % 49.00% Prio Foods AJFS Construções, ACE Lisbon Prio Foods ACE % 24.50% Nutre Farming B.V. Amsterdam Nutre Farming % 49.00% Bunge Prio Cooperativa U.A. Amsterdam Bunge Prio Cooperativa % 22.05% Bunge Roménia S.R.L. Buzau Bunge Roménia % 22.05% Centralrest, Lda Ilhavo Centralrest 1) % 9.80% Prio Agriculture, B.V. Delft Prio Holanda % 49.00% Porthold Project Development BV Amsterdam Porthold % 49.00% Fertilis Agro-Indústrias, Lda Luanda Fertilis % 29.40% Prio Energy SGPS. S.A. Oliveira de Frades Prio Energy SGPS 1) 10,00% % Prio Biocombustíveis. S.A. Oliveira de Frades Prio Biocombustíveis 1) % 10.00% Prio Energy. S.A. Oliveira de Frades Prio Energy 1) % 10.00% Mondefin Coimbra Mondefin 1) % 10.00% Prio Parque de Tanques de Aveiro, S.A. Oliveira de Frades Prio Tanques 1) % 10.00% Prio.E-Electric, S.A. Oliveira de Frades Prio.E-Electric 1) % 10.00% PRIO.E - Mobility Solutions, Lda _PT Oliveira de Frades Park Charge 1) % 10.00% Prio. E SGPS, S.A. Oliveira de Frades Prio E SGPS 1) % 10.00% Share Motivation, Lda. Oliveira de Frades Share Motivation 1) % 10.00% Joint control companies Ventinveste, S.A. Lisbon Ventinveste SA 5,00% 41.00% 46.00% Ventinveste Eólica, SGPS, S.A. Lisbon Ventinveste Eólica % 46.00% Ventinveste Indústria SGPS, S.A. Oliveira de Frades Ventinveste Indústria % 46.00% Parque Eólico de Torrinheiras, S.A. Lisbon PE Torrinheiras % 46.00% Parque Eólico do Douro Sul, S.A. Lisbon PE Douro Sul % 46.00% Parque Eólico do Pinhal do Oeste, S.A. Lisbon PE Pinhal do Oeste % 46.00% Parque Eólico de Vale Grande. S.A. Lisbon PE Vale Grande % 46.00% Parque Eólico de Vale do Chão, S.A. Lisbon PE Vale do Chão % 46.00% Parque Eólico do Cabeço Norte, S.A. Lisbon PE Cabeço Norte % 46.00% Parque Eólico da Serra do Oeste, S.A. Lisbon PE Serra do Oeste % 46.00% Parque Eólico do Planalto, S.A. Lisbon PE Planalto % 46.00% Eviva Dunowo, Sp. Z o.o. Gliwice Eviva Dunowo % 50.00% SPEE 3 Parque Eólico do Baião, S.A. Lisbon SPEE % 50.00% SPEE 2 Parque Eólico de Vila Franca de Xira, S.A. Oliveira de Frades SPEE % 50.00% Parque Eólico da Penha da Gardunha, Lda. Oliveira de Frades PE Penha da Gardunha % 50.00% 1) The consolidation of this company through the equity method results from the Group having significant influence of its parent company, which in turn has significant influence on the investee. During the 3 month period ended 31 March of 2014 and during 2013 the changes occurred in the consolidation perimeter were as follows: Incorporated companies: In the 3 month period ended 31 March of 2014: There were no incorporations. 3M2014 REPORT PAGE 39

40 In 2013: HEAD OFFICE Metallic Construction Subsidiary companies: Martifer Aluminium SAS Martifer Alumínios Ltda West Sea - Estaleiros Navais, Lda. Martifer Construcciones Peru, S.A. Global Holding Limited Global Engineering & Construction Limited Associate companies: Martifer Amal, S.A. (Portugal) Rungis São Paulo Oliveira de Frades Lima Zebbug Zebbug Oliveira de Frades Solar Subsidiary companies: Martifer Solar Servicios México Martifer Solar Japan KK MTS Francis Court Solar Limited MTS Spittleborough Solar Limited MTS Tonge Solar Limited MTS Rydon Solar Limited Visiontera Unipessoal, Lda Martifer Solar Middle East Belive in Bright Unipessoal, LDA. Montidílico Unipessoal, LDA. Associate companies: MSN Solar Uno SpA MSN Solar Dos SpA MSN Solar Tres SpA MSN Solar Cuatro SpA MSN Solar Cinco SpA FTP Solar LLC Cidade do México Tóquio Londres Londres Londres Londres Oliveira de Frades Dubai Oliveira de Frades Oliveira de Frades Santiago Santiago Santiago Santiago Santiago Nova Iorque RE Developer Subsidiary companies: Eólica Macaúbas, Ltda. Eólica Sobradinho, Ltda. MSPAR Energia e Participações, SA Martifer Renewables O&M Sp. z o.o. Fortaleza Fortaleza Barueri Gliwice Others: Associate companies: Nutre Farming West Part S.R.L. Bucareste Acquired companies: In the 3 month period ended 31 March of 2014: There were no acquisitions. In 2013: HEAD OFFICE Others: Associate companies: Fertilis Agro-Indústrias, Lda Luanda PAGE 40 3M2014 REPORT

41 Sold / dissolved companies: In the 3 month period ended 31 March of 2014: Solar MTS Spittleborough Solar Limited HEAD OFFICE Londres In 2013: SEDE Solar Subsidiary companies: MTS4 S.R.L. MPrime Italia S.r.l Sol Cativante VII, Lda. Eviva Mepe MTS Trewidland Solar, Ltd Steadfast Apsley Solar, Ltd LRCC La Rad Campo Charro Energias Renováveis, Lda. Siracusa Oliveira de Frades Viseu Atenas Londres Andover São Martinho do Porto RE Developer Subsidiary companies: Martifer Renewables Bippen GmbH Energia Wiatrowa Sp. Zo.o Berlim Gliwice Others Joint control companies: Macquarie Capital Wind Fund Pty Limited Sidney Changes in the consolidation method: In the 3 month period ended 31 March of 2014: MTS 3 from equity method to full consolidation due to the increase in the shareholding held by Martifer Solar Itália from 49% to 100%. In 2013: Prio Agriculture B.V. (Prio Holanda) from full consolidation to equity method due to its sale by Martifer Renewables SGPS, S.A. to Nutre SGPS, S.A. Porthold Project Development BV (Porthold) - from full consolidation to equity method due to the sale of Prio Agriculture B.V. by Martifer Renewables SGPS, S.A. to Nutre SGPS, S.A. MTS 3 from full consolidation to equity method due to the decrease in the shareholding held by Martifer Solar Itália from 100% to 49%. Ventinveste Indústria SGPS, S.A. from full consolidation to equity method due to loss of control over same, namely for not managing its financial and operational policies. Other changes in the consolidation perimeter: In the 3 month period ended 31 March of 2014: No changes in the consolidation perimeter. 3M2014 REPORT PAGE 41

42 In 2013: Porthold Project Development BV (Porthold) increase in the shareholding held by Prio Agriculture B.V from 55% to 100%. Eviva Gizalki Sp.Zo.o (Eviva Gizalki) increase in the shareholding held by Martifer Renewables SGPS, S.A. from 72% to 100%. Martifer Solar USA, Inc. (AEM) increase in the shareholding held by Martifer Solar Inc. from 63.5% to %. Eviva Nalbant S.R.O. (Eviva Nalbant) increase in the shareholding held by Eviva Energy S.R.L. from 99% to 100%. Rosa dos Ventos S.A. (Rosa dos Ventos) increase in the shareholding held by Martifer Renováveis-Geração de Energia e Participações, S.A. from 97.5% to 100%. Prio Energy SGPS decrease in the shareholding held by Martifer SGPS, S.A. from 49% to 10%. PV Glass, SA merger by incorporation in Martifer Solar S.A. PV Glass, Srl change in shareholder structure as a result of the merger by incorporation of PV Glass in Martifer Solar S.A. M City Gliwice Sp. Zo.o increase in the shareholding held by Martifer GmbH from 52.6% to 97.8% and a further increase of 2% through Martifer Metallic Constructions, SGPS, S.A. 3. INFORMATION BY BUSINESS SEGMENTS The Group bases its disclosure of information for primary segments on its internal organisation in terms of management. The Group is organised in three business areas: Metallic Construction, Solar and RE Developer that are coordinated and supported by Martifer SGPS. The Metallic Construction business area includes all the construction activities of steel structures, aluminium façades and glass and stainless steel solutions. It includes also the wind power division, components, turbine assembly and turnkey wind farm delivery, engineering division and navy. In the Solar segment the focus is on the production of PV panels, as well as the turnkey solar parks delivery, promotion, licensing, operation and maintenance of projects. The RE Developer segment includes the promotion and development of projects of renewable energy, with special emphasis in the wind sector. Amounts related with Martifer SGPS, Martifer Inovação e Gestão S.A. (MIG) and Martifer Gestiune Si Servicii, S.R.L. (MIG RO) are reported as Others. The accounting policies used in the preparation of the information by business segments is the same used in the preparation of the attached financial statements (Note 1). At 31 March 2014 and 2013, the breakdown of sales and services rendered by primary segments is as follows: SALES TO EXTERNAL CUSTOMERS INTERSEGMENT SALES TOTAL 3M'14 3M'13 Metallic Construction 46,503,459 64,924,474 9,633,899 8,872,132 56,137,358 73,796,606 Solar 36,317,320 57,394, ,508 14,373,021 36,948,828 71,767,278 RE Developer 2,772,602 3,698,810 51,590 84,718 2,824,192 3,783,528 Others 403, , , ,086 1,403,085 1,039,535 3M'14 3M'13 3M'14 3M'13 85,997, ,279,990 11,316,298 24,106,957 97,313, ,386,947 Intersegment eliminations (8,317,764) (22,689,966) Own work capitalized (Note 5) (2,998,534) (1,416,991) 85,997, ,279,990 Sales and services rendered by geographical segments are as follows: PAGE 42 3M2014 REPORT

43 Iberian Peninsula 3M'14 3M'13 Metallic Construction 12,205,322 29,285,059 Solar 10,909,377 10,942,852 RE Developer 625, ,029 Others 364, ,432 European Union (other) Metallic Construction 12,683,130 13,945,610 Solar 21,760,855 28,249,616 RE Developer 1,209,579 1,518,925 Others 39,563 15,018 Other markets Metallic Construction 21,615,007 21,693,805 Solar 3,647,089 18,094,835 RE Developer 937,521 1,687,809 85,997, ,279,990 At 31 March 2014 and 2013, the earnings before interest, taxes, amortizations, provisions and impairment losses (EBITDA), earnings before interest and taxes (EBIT) and profit after tax by primary segments are as follows: 3M'14 EBITDA EBIT PROFIT AFTER TAX 3M'13 Metallic Construction (437,083) (1,034,879) (2,153,461) (2,973,997) (6,390,390) (7,513,119) Solar (1,696,059) 1,381,526 (2,310,714) 331,762 (4,498,331) 237,349 RE Developer 1,671,753 2,502,148 (74,831) 491, , ,887 Others 392,947 (227,273) (42,844) (707,925) (2,078,526) (7,012,550) 3M'14 3M'13 3M'14 3M'13 (68,442) 2,621,522 (4,581,850) (2,859,017) (12,392,704) (14,025,433) The Group s net assets and liabilities by operating segments at 31 March 2014 and 31 December 2013 are as follows: ASSETS LIABILITIES 31 MARCH DECEMBER MARCH DECEMBER 2013 Metallic Construction 333,892, ,230, ,963, ,847,934 Solar 233,332, ,606, ,814, ,727,147 RE Developer 184,044, ,932,839 67,563,938 44,917,163 Holding and MIGs 523,951, ,799, ,096, ,855,470 Intra-group eliminations (487,031,032) (490,796,517) (45,501,374) (49,266,682) 788,189, ,773, ,936, ,081,032 The amount of assets and liabilities at 31 March 2014 and 31 December 2013 above includes Assets held for sale (see Note 19). The Group s capital expenditures (acquisition of tangible and intangible assets) and amortizations, by operating segments, till 31 March 2014 and 2013, are as follows: CAPITAL EXPENDITURES AMORTIZATIONS 31 MARCH MARCH MARCH MARCH 2013 Metallic Construction 3,394,149 2,170,005 1,685,308 1,860,521 Solar 396,386 1,799, , ,186 RE Developer 351, ,905 1,727,797 1,373,495 Others 2,342 42, , ,653 4,144,507 4,676,736 4,470,522 4,462,855 3M2014 REPORT PAGE 43

44 4. SALES AND SERVICES RENDERED At 31 March 2014 and 2013, the breakdown of sales and services rendered is as follows: Revenue from the sale of merchandise 4,820,339 16,212,608 Revenue from the sale of goods 41,286,557 30,516,555 Services rendered 39,890,268 79,550,827 3M'14 3M'13 85,997, ,279, OTHER OPERATIONAL GAINS At 31 March 2014 and 2013 the breakdown of the caption Other operational gains is as follows: Change in production 644, ,311 Own work capitalised 2,998,534 1,416,991 Reversals of impairment losses: Trade debtors (Note 17) 1,000 4,324 Supplementary income 581, ,850 Gains in inventories ,365 Capital Gains in non-financial assets 388, ,055 Operating subsidies ,505 Investments subsidies 39,853 36,837 Foreign exchange gains 1,355,201 3,179,682 Other operational gains 624,950 1,091,382 3M'14 3M'13 6,634,544 6,731,301 The caption Change in production is mainly related with works in progress in Brazil, in Metallic Construction segment. The amount included under the heading 'Own work capitalized, during the period ended 31 march of 2014 is related primarily with work carried out in Brazil in the 'Metallic Construction segment. 6. COST OF GOODS SOLD At 31 March 2014 and 2013 the cost of goods sold is as follows: 31 MARCH 2013 MERCHANDISE RAW-MATERIALS, SUBSIDIARIES AND OTHER CONSUMABLES TOTAL Opening balance 6,557,447 10,825,365 17,382,812 Purchases 13,585,986 36,890,926 50,476,912 Changes in the consolidation perimeter, currency exchange differences, transfers and others 6,779,641 (114,028) 6,665,613 Closing balance 13,806,517 12,388,538 26,195,055 Cost of goods sold 13,116,557 35,213,725 48,330,282 PAGE 44 3M2014 REPORT

45 31 MARCH 2014 MERCHANDISE RAW-MATERIALS, SUBSIDIARIES AND OTHER CONSUMABLES TOTAL Opening balance 5,663,577 11,458,141 17,121,718 Purchases 6,514,761 24,520,787 31,035,548 Changes in the consolidation perimeter, currency exchange differences, transfers and others (540,915) 1,140, ,094 Closing balance 4,969,288 12,265,300 17,234,588 Cost of goods sold 6,668,135 24,853,637 31,521, SUBCONTRACTORS At 31 March 2014 and 2013 the subcontractors is as follows: 3M'14 3M'13 Subcontractors 19,616,962 38,255,801 19,616,962 38,255,801 The subcontracts are related with construction works carried out, mainly in the Solar and Metallic Construction segments. 8. EXTERNAL SUPPLIES AND SERVICES At 31 March 2014 and 2013 the external supplies and services are as follows: 3M'14 3M'13 Transportation of goods 2,578,104 3,615,032 Specialized works 5,095,015 3,509,500 Leases and rents 3,810,349 3,367,200 Service Fees 618, ,433 Travelling expenses 1,801,702 1,305,441 Electricity and Fuel 781, ,069 Insurance 986, ,125 Maintenance and repairs 701, ,918 Communications 318, ,533 Security 379, ,669 Legal and notarial fees 419, ,776 Commissions 241, ,663 Advertising 76, ,667 Cleaning, health and safety 148, ,422 Tools and devices 107,810 82,895 Office material 229, ,114 Other 778, ,013 19,073,803 17,399,470 3M2014 REPORT PAGE 45

46 9. STAFF COSTS At 31 March 2014 and 2013, staff costs are as follows: Salaries 14,774,359 15,691,392 Social contributions 4,206,498 4,879,285 3M'14 3M'13 18,980,857 20,570,677 The caption social contributions includes mainly the social security contributions, the food and health subsidies, insurance costs and dismissal compensation. 10. OTHER OPERATIONAL LOSSES At 31 March 2014 and 2013, the caption Other operational losses is as follows: Taxes 869, ,546 Impairment losses: Trade debtors (Note 17) 90,049 5,479 Other impairment losses - 335,838 Losses in inventories 19, ,393 Losses in non-financial assets 867,433 5,974 Foreign exchange losses 1,028,963 1,575,550 Trade debtors write-off - 543,409 Fines and penalties 58, ,684 Other operational losses 572,553 1,964,666 3M'14 3M'13 3,506,757 5,833, NET FINANCIAL RESULTS The net financial results for the periods ended on 31 March 2014 and 2013 can be analysed as follows: FINANCIAL INCOME Loans and accounts receivable (including bank deposits) - Interest income 753,700 1,022,179 Financial assets available for sale - Dividend income 86,848 - Investimentos detidos para venda - Gains on the sale of financial assets 326,598 46,792 Other financial income related to other financial assets - Foreign exchange gains 806,445 2,377,199 - Other financial income 212, ,808 3M'14 3M'13 2,186,251 3,667,979 PAGE 46 3M2014 REPORT

47 FINANCIAL EXPENSES Loans and accounts payable - Interest expenses in bank loans and in finance leases 6,883,235 5,945,456 - Of which included in the acquisition cost of assets in progress (7,493) (483,411) Available for sale financial assets - Losses on the sale of financial assets - 391,369 Other financial expenses related to other financial liabilities - Foreign exchange losses 709,240 2,203,846 - Other financial expenses 1,872,806 3,037,552 3M'14 3M'13 9,457,788 11,094,812 The captions 'Foreign exchange gains / (losses)' are related to the occurrence of currency fluctuations, particularly in affiliated companies out of Euro zone. 12. GAINS/ (LOSSES) IN ASSOCIATE COMPANIES AND JOINT ARRANGEMENTS At 31 March 2014 and 2013, the gains and losses on associate companies and joint-ventures are as follows: Grupo Nutre - (4,730,480) Grupo Prio Energy 86, ,270 SPEE 2 Parque Eólico de Vila Franca de Xira, S.A. 294, ,588 SPEE 3 Parque Eólico do Baião, S.A. 223, ,903 Canaverosa Renovables, SL (68,425) 4,353 Ventinveste 153,073 - Promoquatro Investimentos Imobiliários, Lda. (23,538) (9,386) Macquarie Liskin Green Park (9,606) (72,024) Martifer Amal (195,173) (26,908) Parque Solar Seseña 1 (36,402) (2,767) 3M'14 3M'13 424,206 (3,761,270) 13. INCOME TAX At 31 March 2014 and 2013, the reconciliation between current tax and income tax of the period is summarized as follows: Current tax 388, ,930 Deferred tax - generated by temporary differences 861, ,223 Deferred tax - reversal of temporary differences (18,908) 1,488,235 Effect of changes in the income tax rate - (6,643) Deferred tax - tax losses recognition (157,501) (1,972,039) Other (109,694) (78,394) Deferred tax 575,036 (461,619) Income tax 963,522 (21,689) 3M'14 3M'13 3M2014 REPORT PAGE 47

48 14. EARNINGS PER SHARE Martifer SGPS only issued ordinary shares, and as such, no shares have special voting or dividend rights. Martifer has just one type of potential ordinary dilutive shares: stock options. In order to calculate diluted earnings per share it is necessary to determine if these stock options, independently of being or not exercisable, are diluted, which happened when the exercise price of the opting is lower than the average market price of the shares. Once the average market price of Martifer s shares, in the period between 1 January 2014 and 31 March 2014, was Euro 0.91, lower than the exercise price of the stock options (Euro 3.84), these stock options are non-diluted because, if the options were exercised, the number of shares outstanding would be reduced. Therefore, at 31 March 2014 there were no differences between the basic earnings per share and the diluted earnings per share calculation. The share capital of Martifer SGPS is represented by 100,000,000 ordinary shares, fully paid, representing a share capital of Euro 50,000,000. The weighted average number of shares outstanding is deducted of 2,215,910 treasury stocks acquired by Martifer SGPS. At 31 March 2014 and 2013, the basic and diluted earnings per share can be summarised as follows: Profit for the year (I) (10,329,356) (14,155,169) Weighted average number of shares outstanding (II) 97,864,366 97,784,090 Basic and diluted earnings per share (I) / (II) (0.1055) (0.1448) from continuing operations (0.1055) (0.1464) from Assets as held for sale M'14 3M' FINANCIAL ASSETS UNDER THE EQUITY METHOD At 31 March 2014 and 31 December 2013, financial assets under the equity method are as follows: 31 MARCH DECEMBER 2013 Prio Energy 2,778,225 2,686,807 SPEE 3 - Parque eólico de Baião, SA 723, ,853 SPEE 2 - Parque eólico de Vila Franca de Xira, SA 1,342,977 1,048,183 FTP Solar LLC 36,295,874 36,287,978 Promoquatro - Investimentos Imobiliários, Lda 96, ,260 Martifer Amal, S.A. (Portugal) 5,950 15,000 Martifer Amal, S.A. (Mozambique) 123, ,771 Canaverosa - 136,301 Parque Sesena 1 108, ,663 Other - 5,254 41,475,206 41,282,070 At 31 March 2014 and 31 December 2013, the movement occurred in this caption is as follows: 31 MARCH DECEMBER 2013 Opening balance 41,282,070 15,680,011 Acquisitions - 36,302,978 Application of the equity method 344,293 1,706,974 Decrease in share capital - (2,043,840) Sales - (10,208,467) Changes resulting from the loss of control in subsidiaries - 4,900 Effect of foreign currency exchange differences (39,465) (22,387) Other changes (111,693) (138,099) Closing balance 41,475,206 41,282,070 PAGE 48 3M2014 REPORT

49 16. AVAILABLE FOR SALE INVESTMENTS At 31 March 2014 and 31 December 2013, available for sale investments are as follows: 31 MARCH DECEMBER 2013 Non-current financial investment 1,071, ,166 Others 237, ,457 1,309, ,622 At 31 March 2014 and 31 December 2013, the movement occurred in the caption Available for sale investments is as follows: 31 MARCH DECEMBER 2013 Opening balance 575,622 2,310,267 Additions 731, ,925 Reductions - (235,268) Reclassification to assets held for sale - (1,607,994) Changes in the consolidation perimeter - (189,688) Other 2,280 (8,619) 1,309, , TRADE AND OTHER RECEIVABLES The detail of the caption trade and other receivables, for the periods ended at 31 March 2014 and 31 December 2013 is as follows: NON CURRENT CURRENT 31 MARCH DECEMBER MARCH DECEMBER 2013 Cost: Trade receivables: Trade receivables 30,462,734 29,132, ,289, ,985,850 Notes receivables , ,697 Doubtful trade receivables ,533,635 25,620,958 30,462,734 29,132, ,404, ,370,505 Other receivables: Related companies 61,595,582 61,480,963 16,332,232 14,993,979 Advances to suppliers 5,392 2,718 9,911,221 10,199,844 Others 437,791 1,982,307 34,428,746 33,699,529 62,038,765 63,465,988 60,672,199 58,893,352 92,501,499 92,598, ,076, ,263,858 The caption of non-current Trade receivables refers mainly to an amount to receive from an associate company, in the Solar segment, which will be regularized as soon as this company obtains revenues from the sale of energy. This receivable amount bears interests at the market rate. 3M2014 REPORT PAGE 49

50 At 31 March 2014 and 31 December 2013, impairment losses in accounts receivables are as follows: NON CURRENT CURRENT 31 MARCH DECEMBER MARCH DECEMBER 2013 Accumulated impairment losses: Doubtful trade receivables ,112,742 28,754,831 Other receivables 122, ,154 8,135,752 7,437, , ,154 36,248,494 36,192,426 Carrying amount trade receivables 30,462,734 29,132, ,291, ,615,674 Carrying amount - other receivables 61,916,122 63,346,834 52,536,447 51,455,757 Total 92,378,856 92,479, ,828, ,071, OTHER CURRENT ASSETS At 31 March 2014 and 31 December 2013, the breakdown of the caption Other current assets is as follows: Accrued income: Construction contracts 31 MARCH DECEMBER 2013 Cost 97,395, ,714,982 Impairment losses (5,769,831) (5,769,831) Carrying amount 91,625,393 96,945,151 Interest to be received 430,443 31,309 Other accrued income 6,236,540 4,225,822 98,292, ,202,282 Prepayments: Insurances 1,331, ,194 Financial expenses 901, ,108 Rents 535, ,044 Other prepayments 3,149, ,360 5,918,051 2,547,706 Other (current) financial assets 341, , ,551, ,115, ASSETS HELD FOR SALE In December 2012, following the decision taken to close the Polish facility, an active plan was put into effect to sell Martifer Polska, Sp. Zo.o s land and factory, integrating the Metallic Construction segment. Additionally, negotiations are underway for the sale of the real estate project in Szczecin (Poland), previously classified as an investment property, with its sale being highly probable. The Group continues committed to selling these assets. Thus, they are satisfied the conditions set by IFRS 5 to the mantainance of this asset as Asset held for sale for a period higher than 12 months. At the end of the first half-year of 2013, Martifer Renováveis Geração de Energia e Participações S.A., 55% controlled by Martifer Renewables SGPS, celebrated a contract to sell 100%, subject to compliance with various conditions, of the company Rosa dos PAGE 50 3M2014 REPORT

51 Ventos Geração e Comercialização de Energias, S.A. (Rosa dos Ventos), that operates the wind farms Canoa Quebrada and Lagoa do Mato. Since all the conditions set by IFRS 5 are satisfied, both the assets in Poland and the assets and liabilities of Rosa dos Ventos are classified as Assets held for sale and Liabilities associated with assets held for sale, respectively. The breakdown of assets and liabilities of the business unit held for sale at 31 March 2014 and 31 December 2013 as follows: 31 MARCH DECEMBER 2013 Intangible Assets 113,406 - Tangible Assets 22,515,796 22,048,574 Investment properties 5,013,089 5,002,006 Available for sale investments 1,350,222 1,357,067 Trade receivables 635,969 1,865,298 Other receivables 1,353, Current tax assets 3,188 3,060 Other current assets 886, ,622 Cash and cash equivalents - 400,175 Derivatives - - Total assets held for sale 31,871,425 30,812,048 Non-controlling interests attributable to Assets held for sale 3,080,394 2,891,441 Non-current liabilities Borrowings 10,530,244 10,889,344 Current liabilities Borrowings 626,539 - Trade payables 699 2,621 Other payables 313, ,297 Current tax liabilities 35,659 29,777 Other current liabilities - 9,234 Liabilities related to Assets held for sale 11,506,389 11,186,273 Assets net of liabilities and Non-controlling interests related to Assets held for sale 17,284,642 16,734, SHARE CAPITAL, TREASURY SHARES AND NON-CONTROLLING INTERESTS Share capital Martifer SGPS, SA share capital, fully subscribed and paid at 31 March 2014, amounts to Euro 50,000,000 and it is represented by 100,000,000 bearer shares with a nominal value of 50 cents each. All shares have the same rights, including one vote per share. During first three months of 2014 and 2013, no movements occurred in the number of shares of the Group. During first three months of 2014 and 2013, Martifer SGPS, S.A. did not acquire any shares. The Group held 2,215,910 treasury shares, corresponding to 2.22% of its capital. At 31 March 2014, the share capital of Martifer SGPS, S.A. was held in 42.7% by I M SGPS, S.A., 37.5% by Mota-Engil SGPS, S.A., and 2.22% are treasury shares. The remaining 17.58% represents free-float listed in Euronext Lisbon. 3M2014 REPORT PAGE 51

52 Non-controlling interests Movements in the non-controlling interests are as follows: 31 MARCH MARCH 2013 Opening balance 39,676,431 50,975,912 Net profit of the year (2,063,347) 287,823 Other changes in equity of subsidiaries (1,866,422) 1,798,347 Changes in the consolidation perimeter - (75,706) Transactions with non-controlling interests - (71,870) Others (123,958) 60,659 35,622,704 52,975,165 At 31 March 2014, the most significant value is related with non-controlling interests of Martifer Solar, S.A., amounted in to Euro 29.7 million. 21. BORROWINGS At 31 March 2014 and 31 December 2013, borrowings can be analysed as follows: 31 DECEMBER 2013 UNTIL 1 YEAR BETWEEN 1 AND 3 YEARS BETWEEN 3 AND 5 YEARS MORE THAN 5 YEARS Bank loans 57,100,333 46,334,767 91,213,197 55,289, ,938,117 Bank overdrafts 15,808, ,711 1,808,595 18,324,384 Authorized overdrafts 42,592, ,160 4,395,956 10,135,017 57,535,266 Commercial paper 8,000,000 3,000,000 3,250,000-14,250,000 Other borrowings 10,251,178 1,712,287 1,926,745 2,656,515 16,546,725 TOTAL 133,751,722 51,459, ,493,609 69,889, ,594,492 Obligation under finance leases 18,274,697 Cash and cash equivalents 38,843,709 Derivatives 224,214 Net debt 335,801, MARCH 2014 UNTIL 1 YEAR BETWEEN 1 AND 3 YEARS BETWEEN 3 AND 5 YEARS MORE THAN 5 YEARS Bank loans 55,751,090 49,157,434 90,854,523 48,328, ,091,297 Bank overdrafts 21,835, ,711 1,808,595 24,351,459 Authorized overdrafts 42,686, ,160 4,395,956 10,150,687 57,645,092 Commercial paper 8,750,000 3,000,000 2,500,000-14,250,000 Other borrowings 16,079,697 1,526, ,897 2,656,515 21,057,271 TOTAL 145,102,229 54,095,756 99,253,087 62,944, ,395,119 Obligation under finance leases 18,064,421 Cash and cash equivalentes 49,582,358 Derivatives 85,746 Net debt 329,791,436 The Group continues focused on reducing Net Debt, as such, it continues committed to the process of selling non-core assets, especially wind farms, solar projects and, residually, real-estate projects, during PAGE 52 3M2014 REPORT

53 22. TRADE PAYABLES AND OTHER PAYABLES At 31 March 2014 and 31 December 2013, trade payables and other payables can be analysed as follows: NON CURRENT CURRENT 31 MARCH DECEMBER MARCH DECEMBER 2013 Trade payables 12,231,215 11,972, ,446, ,031,422 Fixed assets suppliers 111, ,895 1,016,400 Related companies and other shareholders 7, ,870 4,408,554 3,648,374 Advanced payments received from customers ,340,647 16,532,026 Other creditors 1,427,625 1,330,346 36,018,918 7,654,569 Other payables 1,546,506 1,752,216 56,254,014 28,851,369 Total 13,777,721 13,725, ,700, ,882,791 The balance of non-current Trade payables is related, mainly, with retentions in works performed by external parties, which will be released after the period of guarantee. At 31 March 2014 and 31 December 2013, the non-current balances due to related companies and other shareholders refer to loans obtained from companies consolidated by the proportionate method, which bear interest at Euribor 3M increased by a 6.75% spread. 23. PROVISIONS The information related with Provisions as of 31 March 2014 and 31 December 2013 can be detailed as follows: 31 MARCH DECEMBER 2013 Quality guarantees 3,305,801 3,335,399 Legal claims in progress 1,556,933 1,553,533 Provisions arising from the use of the equity method 5,511,331 5,450,401 Others 11,799,608 11,987,549 22,173,673 22,326,882 The change in the Provisions, compared with 31 December 2013, is as follows: OPENING BALANCE ADDITIONS DEDUCTIONS APPLICATIONS CHANGE OF CONSOLIDATION PERIMETER, EXCHANGE RATE DIFFERENCES, TRANSFERS CLOSING BALANCE Quality guarantees 3,335,399 16,782 (29,155) - (17,225) 3,305,801 Legal claims in progress 1,553,533 42,348 (9,094) (32,528) 2,674 1,556,933 Provisions arising from the use of the equity method 5,450,401 40,610-20,320 5,511,331 Others 11,987,549 15,968 (73,264) (113,641) (17,004) 11,799,608 22,326, ,708 (111,513) (146,169) (11,235) 22,173,673 3M2014 REPORT PAGE 53

54 24. OTHER CURRENT LIABILITIES At 31 March 2014 and 31 December 2013, other current liabilities are made up as follows: 31 MARCH DECEMBER 2013 Accrued expenses Holiday pay and bonuses 7,128,326 5,867,390 Interest borne but not yet overdue 4,450,425 3,922,237 Production performed by third parties not yet invoiced 2,975,608 4,865,198 Other accrued expenses 11,704,949 7,377,052 26,259,308 22,031,877 Deferred income Production invoiced and not yet performed (related to construction contracts) 19,332,167 20,350,406 Subsidies / Government grants 1,719,588 1,753,735 Other deferred income 2,320,626 2,691,439 23,372,381 24,795,580 49,631,689 46,827,457 The caption "Other accrued expenses" includes supplies and services rendered up to 31 March 2014 whose invoices were received after this date. 25. CONTINGENT LIABILITIES At 31 March 2014, the contingent liabilities are as follows: a) On 29 October 2009, Martifer Polska, in consortium with Ocekon Engineering s.r.o. (Slovakia), concluded with Energomontaz Południe S.A. an agreement for Works, which object was the manufacture, execution, delivery and installation of the steel roof on the Baltic Arena Stadium in Gdańsk (Poland), in the amount of approximately Euro 11.3 million. On 2 September 2010, Martifer received, from Energomontaz Południe S.A., notice of the immediate termination of the agreement, without any prior warning. The main reason alleged for the termination were delays in the execution, which, in Martifer s opinion, is totally unfounded and ultimately ineffective. Despite attempts at the amicable settlement of the matter, Martifer has been forced to lodge a motion with the Court. On 17 December 2010, Martifer lodged an official lawsuit with the Court in Katowice, against Energomontaz. The amount of the lawsuit is approximately Euro 12.6 million. On 18 January 2012, Energomontaz - Południe SA lodged its legal suit against Martifer, involving Euro 5.8 million. Martifer Group has recognized, in its financial statements, impairment losses relating to the account receivable, production not invoiced and the bank guarantee executed; it therefore considers that this litigation risk is adequately covered in its financial statements. b) On 28 April 2011, construction contract no. 3/Z/2011 was signed between Martifer Konstrukcje and Śląskie Centrum Logistyczne. On 15 May 2012, Sląskie Centrum Logistyczne S.A. levied Martifer Konstrukcje with a penalty of 540 thousand Euros since, in their opinion, Martifer was behind in terms of contract execution. This penalty was treated by the client as an amount due and deducted from the receivables balance. On 4 October 2012, Martifer Konstrukcje sp. z o.o. lodged with the Court in Gliwice an action against Śląskie Centrum Logistyki S.A., in which Martifer claims: The amount of 540 thousand Euros plus interest as from 2 June 2012, for the non-payment of the invoice dated 27 April 2012, based on the construction agreement; The amount of 540 thousand Euros plus interest as from the date of the court case, as a penalty for delays in the completion of the final acceptance; An amount of 133 thousand Euros plus interest from the date of the court case, as payment for additional work. The Court hearings commenced in January PAGE 54 3M2014 REPORT

55 In respect of the above mentioned amounts, Martifer Konstrukcje has only recognized in its books the receivable described in the first point, having, nevertheless, created a 100% provision against said amount. c) Martifer is currently involved in two arbitration proceedings. On one hand, there is a dispute between Martifer and Alstom regarding the termination of the project in Sostanj (Slovenia). Martifer claims for compensation under the agreement, in 1.4 million Euros and Alstom claims for damages and increased costs. In addition, Martifer claims for the reimbursement of the bank guarantees executed, in the amount of 6.1 million Euros. On the other hand, there is a dispute between Martifer and Alstom regarding the termination of the project in Mannheim (Germany). Martifer claims for compensation under the agreement, in 6.9 million Euros for work done and costs incurred, in 3.5 million Euros in reimbursement of the wrongfully executed bank guarantees, as well as for further amounts (financial charges for bank guarantees and interest), still to be determined. Alstom claims for damages and increased costs. In order to safeguard the risk involved, the Group decided, as a matter of prudence, to recognize in its financial statements an impairment loss, that it considers adequate, in respect of the amounts under discussion, totalling some 10 million Euros. Negotiations with Alstom were established, which point to a favorable outcome during the first half of The Group's expectation is that no losses will occur with these processes over and above the amount of impairment losses already recognized in its financial statements. 26. COMMITMENTS The nature of the Group's commitments did not change in comparison with 31 December RELATED PARTIES Group companies have commercial relations with each other that qualify as related parties transactions. All of these transactions are performed on an arm s length basis. Consequently, all these transactions are eliminated, since the consolidated financial statements disclose information regarding the holding company and its subsidiaries as if they were a single entity. The balances resulting from transactions performed with associate and jointly controlled companies, accounted through the equity method, are not eliminated. The amount of the balances not eliminated is approximately Euro 84,000,000, with special regard to the accounts receivable from Nutre and Prio Energy Groups which amount to Euro 58,900,000, which does not bear interest and has no defined reimbursement period. This amount is net of Euro 39.3 million relating to the application of the Equity Method over the 2010 through 31 March 2014 periods and impairment loss recognized. Besides current transactions, some relating to civil construction done with the Mota-Engil Group and others associated with real estate management projects under way done by Estia Group, there are not any other significant balances and transactions performed with related parties during the period ended 31 March 2014, that had affected significantly the financial position or performance of the Group. 3M2014 REPORT PAGE 55

56 28. SUBSEQUENT EVENTS Since the date of financial statements until the present date occurred the follow subsequent events: Martifer Metallic Constructions increases equity Martifer Metallic Constructions increased, via Martifer SGPS s main shareholders, its equity in around 28 million euros. WEST SEA took possession of the Sub-concession of Viana do Castelo s Naval Shipyard On 2 May 2014, the company West Sea Estaleiros Navais, Lda, a part of Martifer Group, took possession of the sub-concession, following the sub-concession for private use of public domain and of the areas allocated to the dominial concession attributed to the company Estaleiros Navais de Viana do Castelo (ENVC). 29. APPROVAL OF THE FINANCIAL STATEMENTS The accompanying consolidated financial statements were approved by the Board of Directors on 9 May PAGE 56 3M2014 REPORT

57 30. EXPLANATION ADDED FOR TRANSLATION OF THE FINANCIAL STATEMENTS These financial statements are a translation of the consolidated financial statements originally issued in Portuguese in accordance with the International Financial Reporting Standards as adopted by European Union. In the event of discrepancies, the Portuguese version prevails. Oliveira de Frades, 9 May 2014 The Chief Accountant The Board of Directors Isabel Cristina Loureiro Silva Carlos Manuel Marques Martins Jorge Alberto Marques Martins Mário Rui Rodrigues Matias Arnaldo José Nunes da Costa Figueiredo Luís Filipe Cardoso da Silva Luís Valadares Tavares Jorge Bento Ribeiro Barbosa Farinha 3M2014 REPORT PAGE 57