Annual Report Annual Report

CONFIDENCE IN BRAZIL Board of Directors

Name Position Date of Election Eduardo Borges Andrade Chairman of the Board 6/7/00 Luis Fernando Souza Villar Vice Chairman 6/7/00 Amin Farid Safatle Director 6/7/00 Fernando Márcio Queiroz Director 7/4/01 João Pedro Ribeiro de Azevedo Coutinho Director 6/20/01 Julio César Borges Director 1/17/02 Manoel Ailton Soares dos Reis Director 6/7/00 Paulo de Tarso de Camargo Opice Director 6/7/00 Ricardo Bisordi de Oliveira Lima Director 6/7/00 Ricardo Coutinho de Sena Director 7/31/01 Vitor Paulo Saltão da Silva Director 6/20/01 Executive Board

Name Age Position End of Mandate Renato Alves Vale 53 CEO 2002 Former CEO of AutoBAn and Engineering Director at NovaDutra. Before starting to work in the highway concessions business in 1995, Mr. Vale held several administrative positions at big national construction companies. He holds a degree in civil engineering from the Federal University of Minas Gerais.

Antonio Linhares da Cunha 43 Director of Business 2002 For ten years, Mr. da Cunha worked with the developing concession and Technology business and groups of Andrade Gutierrez. Prior to that, he worked Development for ten years in national construction companies. He holds a civil engineering degree from the Federal University of Minas Gerais.

Líbano Miranda Barroso 37 Chief Financial Officer 2002 From 1997 to 2000, a member of the project finance group of and Investor Relations Andrade Gutierrez. Mr. Barroso worked in the financial markets for Director over 17 years at Banco Safra, Banco Nacional and Banco Real. He holds a degree in economics from the Federal University of Minas Gerais and also an Executive MBA in Finance from the Brazilian Institute of Capital Markets (IBMEC). Mr. Barroso also holds a post- graduate degree in business law from the Fundação Getúlio Vargas. Manuel Eduardo Henriques de Andrade Lamego 45 Chief Operations Officer 2002 Mr. Lamego was previously the head of the department of corporate planning studies at Brisa Auto-estradas de Portugal S.A., beginning in 1988. Prior to that, he worked in the department of corporate and planning studies of Centralcer (Portugal) from 1984 to 1987 and, from 1981 to 1984, in the Central Planning Department of the Portuguese Ministry for Planning. He holds a degree in economics from the Instituto Superior de Economia, in Lisbon. Massami Uyeda Junior 32 Director of Legal Affairs 2002 Mr. Uyeda previously worked for the law office firm of Clifford Chance in New York for one year, and, in Brazil, worked for seven years, as an internal lawyer in Brazil for the Companhia Brasileira de Projetos e Obras (CBPO), a construction company belonging to the Odebrecht group. He holds a degree in law from the University of São Paulo and in business administration from the Fundação Getúlio Vargas. Rui de Souza Oliveira 59 Director of Planning 2002 Former planning and control director of Camargo Corrêa. Previously and Control held several positions within the Camargo Corrêa group, where he worked for 35 years. He has degrees in civil engineering from the University of São Paulo and Stanford University.

Index

Letter to Shareholders 13 Overview of the Toll-Road Sector in Brazil 16 CCR’s Strategy 18 The Macro-economic Scenario in Brazil 22 Corporate Governance Framework 24 CCR’s Five Toll-Road Concessions 29 Management’s Analysis of Results for Fiscal Year 2001 41 Social and Environmental Report 52 Acknowledgements 56 Financial Statements (Brazilian Corporate Law) 59 Investor Information 84 Financial Statements (U.S. GAAP) see appendix Company Profile

Companhia de Concessões Rodoviárias (CCR) was incorporated in September 1998 by the common partners of the consortiums that won the concessions to operate the federal and state highway concessions for AutoBAn, NovaDutra, Rodonorte, Ponte Rio-Niterói and Via Lagos. The objective of consolidating these assets into CCR was to develop a centralized portfolio management strategy that would open the way to better operational practices, reduce risks, capture synergies, create value for shareholders and efficiently access the capital markets, which is an important alternative source of financing in the infrastructure business. CCR is currently the largest holding company for highway concessions in Brazil and the entire Latin America as well as one of the top in the world. In Brazil, the company manages nearly 1,300 kilometers of highway concessions with remaining terms ranging from 13 to 20 year, representing in 2001 14% of the length and 31% of the revenues of highways under concession 1 in the country. CCR was the first company to list on the New Market (Novo Mercado) of the São Paulo Stock Exchange (Bovespa), with an initial public offering of 16,963,601 common shares, or 20% of the company’s registered capital. The company’s shares started trading on February 1, 2002, under the stock symbol CCRO3. The offering of CCR’s only class of shares exceeded the issuer commitments set forth by the New Market and insured proper rights and representation to the new shareholders through a uniquely advanced corporate governance framework, which was previously unheard of in the Brazilian capital markets.

(1) Source: Brazilian Association of Highway Concessionaires (ABCR), 2000 Corporate Structure

CCR’s five concessions are currently managed by special purpose vehicles. CCR also holds shares in Parques, a limited liability company that provides services.

ANDRADE CAMARGO 2 GUTIERREZ BRISA CORRÊA ODEBRECHT SERVENG SVE OUTROS

16% 17% 17% 17% 12% 5% 16%

NEW RELATED CONCESSIONS CONCESSIONS BUSINESS

AUTOBAN NOVADUTRA RODONORTE PONTE VIA LAGOS PARQUES NOVOS 100% 100% 74%1 100% 100% SERVIÇOS NEGÓCIOS 74%1

1. Remaining 26% belongs to local partners 2. 51% Brazilian investors; 39% North American investors and 10% European investors Financial Highlights (information according to Brazilian Corporate Law)

900 870.3 CAGR Net Income = 27.1% 800 CAGR EBITDA = 24.0% CAGR Cash Earnings = 21.4% 700 698.5

600 590.8 545.0 500 417.9 400 372.4 354.4 300 281.4 230.4 200

100

0 (R$ million) 1999 2000 2001 Cash Earnings EBITDA Net Revenue

CAGR = compounded average growth rate EBITDA = earnings before interest, tax, depreciation and amortization

Equivalent Vehicles

250 CAGR = 6.0% 223.4 198.9 200 197.1

150

100

50 Equivalent vehicles are light vehicles, such as passenger cars, with two axles. Heavy vehicles, such as trucks and buses are converted into 0 equivalent vehicles by a multiplier applied to the (million) 1999 2000 2001 number of axles of the vehicle.

10 | Annual Report 2001 80

70 60.0 59.8 62.6 60

50 42.8 39.0 40.3 40 33.6 30 26.8 24.6 20

0 (%) 1999 2000 2001

Operating Profit Margin Cash Earnings Margin EBITDA Margin

On December 31, 2001, CCR had 1,714 full-time employees, of whom 21 were employed by the holding company and the rest at the concessionaires.

Employees per Category 1999 2000 2001 Administration 339 412 383 Operations 1,304 946 1,269 Maintenance 75 84 62

Total CCR 1,718 1,442 1,714

CCR Companhia de Concessões Rodoviárias | 11 Letter to Shareholders

The year 2001 was particularly rewarding for CCR. Our five concessionaires surpassed our own expectations in terms of financial results and the progress made in modernizing our capital structure. Despite the countless challenges encountered during the years and that impacted us directly and indirectly, the determination and persistence of our management team and all employees allowed us to achieve important results. For the year, we posted consolidated revenues of R$931.7 million, reflecting a year-over-year increase of 25.5% that results in a compounded annual growth rate of 23.3% for the three years from 1999 to 2001. At the same time, operating costs for the year grew year-over-year at a lower rate (14.0%) than revenues. Consolidated EBITDA for the year rose to R$545 million, up by 30.4% over 2000, resulting in a compounded annual growth rate of 24.0% for the 1999 – 2001 period. EBITDA margin for the period was a record 62.6%, reflecting our efforts to reduce operating costs. During the year, we invested a total of R$511.9 million, or 10.1% more than in 2000. During the past six years, we invested over R$2 billion in our five highway concessionaires, of which the company’s shareholders had contributed over R$450 million through December 2001. As a provider of a public service, we are aware of our social responsibilities. Thus, we work to continuously improve our highway network to exceed the expectations of users in terms of comfort and safety. With respect to this, we are particularly proud of two statistics: the 24.8% decline registered between 1999 to 2001 in the number of deaths on the highways that we manage, and a significant reduction in the number of assistance calls handled. We are also sponsors to several social and educational programs tailored for the users of our highways and the communities of the areas surrounding our concessions. Additionally, the preservation of the environment is a constant concern in everything that we do. From a corporate point of view, the advances were even more significant. Immediately after our incorporation in September 1998, we started taking all the necessary steps to one day become a publicly traded company. One of these steps was the acquisition in January 2001 of 20% of our capital by Brisa Auto-estradas de Portugal S.A., the largest Iberian highway operator. This was a very important event for our company because Brisa contributes important operating experience acquired in nearly three decades of managing highways in Europe. Once this phase was completed, we moved on to the process of the Initial Public Offering of CCR’s shares. The choice of listing our shares on the New Market (Novo Mercado) of the São Paulo Stock Exchange (Bovespa) was the product of our belief that transparency and the safeguard of proper representation and rights for all shareholders are essential values for a company that operates in the public services sector. It took approximately six months of intensive work, which culminated with our stock beginning to trade on the Bovespa on February 1, 2002, following the public offering of a fifth of our capital. The New Market was the way previously established by CCR to get access to Brazilian and foreign investors, and we intend to be outstanding in this market. Today, CCR is a company that is fully committed to creating increasing returns over time to all its shareholders. To do that, we are working on several initiatives to further expand our margins and improve earnings growth potential by: • Maximizing synergies and economies of scale resulting from operating all our five concessions under one common umbrella; • Expanding and diversifying our highway network, by continuing to be one of the most active participants in Brazil’s highway privatization program, as well as selectively analyzing potential acquisitions - both domestically and abroad - that offer attractive returns on investment; and • Continually expanding the participation of revenues from related business activities. Furthermore, we have established a compensation policy for our executives and employees based on the EVA of our business and will implement a dividend policy that assures maximum distribution of the results generated by the operations. And, for 2002, we are committed to work ever harder at capturing synergies resulting from the combined management of our concessions. There is much to be done both in terms of economies of scale and maximizing operational efficiency by adopting best practices at all concessionaires. We are confident that the same determination that brought our company to where we are today will allow us to maximize our operating margins to the levels that only CCR can achieve.

Renato Alves Vale Eduardo Borges de Andrade CEO Chairman of the Board of Directors

Overview of the Toll-Road Sector in Brazil Overview of the Toll-Road Sector in Brazil

investment in the transportation infrastructure. The first highway concession contract was signed the following year. In 1995, the Brazilian Congress passed specific legislation on the subject, with contractual obligations tailor-made for the needs of each highway. Brazil now has 1,724,921 km of highways, of which 148,690 km are paved, and approximately 10,000 km are currently operated by private entities (37 concessionaires). Another 11,000 km should be privatized over the coming years, in line with Federal and State highway concession programs, according to internal appraisals made by the company. Highways play a key role in Brazil’s transportation infrastructure, being responsible for 96% of passenger traffic and 61% of cargo transportation.

Segmentation of Passenger and The Brazilian Market Cargo Transportation Highways are managed by private The Brazilian highway concession companies in only a few countries program was based on international in the world, Brazil being one of experience but also implemented them. In the entire world, no more several new elements. Brazilian than 15 of these companies are companies like CCR are bidding on listed on stock exchanges. Among other concessions around the country, these, eight European highways but they are also looking for operators are the best known. opportunities for expanding revenues In Brazil, the highway concession generated by related businesses, such model was first developed in 1993. as advertising, leasing right-of-way The objective was to find alternatives for fiber optics and development of for the scarcity of public funds for automatic systems for charging tolls. area with road concession

16 | Annual Report 2001 In Brazil, there are basically three CCR believes in continuously scenarios under which the perfecting the highway concession privatization of highways takes place. model in line with the principle of For the Federal government, the paying in proportion to the concession is granted to the group kilometers used by the driver, which that commits to the lowest toll rate. should result in a more just toll rate. In the case of the States of Rio de To make this possible, the company Janeiro and São Paulo, the State makes every effort to learn as much authorities set a fixed toll rate and as possible about the traffic patterns the rights to operate the concession on its highways and installs toll are awarded to the group that pays plazas at strategic points. the highest concession fee to the entity granting the concession. The state of Paraná also sets the toll rate Growth Opportunities in the and grants the concession to the Number of Vehicles per group that guarantees to maintain Inhabitant Cargo Transportation 2000 the most kilometers of highways or CCR’s prospects are promising in secondary roads. light of Brazil’s growing traffic levels, Aerial 0.3 % Fluvial / Maritime The national highway concession expected economic growth of the 14 % model provides for periodic reviews country, potential increase in the of the 20- and 25-year agreements number of vehicles per inhabitant, to adjust them to changes in which is currently low compared scenario and to discuss the requests with other countries, and increase of the concessionaires and the entity per capita income. granting the concession.

Highway 61 % Pipe 4 % Railroad 1 %

Number of Vehicles / 100 inhabitant - 1999 Passenger Transportation 2000

Aerial 2 %

Highway 96 % Railroad 1 %

Source: Panorama setorial da Gazeta Mercantil - 2001 Subway 1 % CCR’s Strategy

CCR’s strategy is to maximize the concessions has already benefits and capturing synergies produced certain gains and is resulting from the combined expected to continue to do so. management of its five highway • Operational efficiency. concessions, to expand and diversify CCR started introducing best the highway network operated by practices for construction, the company, and to explore maintenance, safety, emergency opportunities in related business and traffic management services activities. on the highways it operates. The company will expand and continue to seek higher levels of Maximize the benefits and operational efficiency also capturing synergies resulting through improving the location from the combined management of toll plazas to reduce the use of the concessions. The company of alternative routes around seeks to maximize both the them, and promoting the use of operating efficiencies and the electronic system for collection economies of scale of placing under of tolls. common ownership AutoBAn, NovaDutra, Rodonorte, Ponte Rio- Niterói and Via Lagos highway Expand and diversify the concessions. highway network. In addition to • Economies of Scale. the organic growth of the current The centralization of certain five highway concessions, CCR will managerial, financial, accounting continue to selectively bid for and administrative functions additional concessions and seek common to each of the acquisition opportunities, mainly in

18 | Annual Report 2001 Brazil. The focus of the company is Exploring opportunities in on already developed projects, with related commercial activities. an established traffic history. The company intend to expand its operations into activities related to • Selective bidding for highway its core business, such as: concessions. Based on the (a) maintenance of access roads to expertise accumulated over the the roadways for which CCR controls years, CCR will selectively the right-of-way; participate in new bidding (b) leasing of sub-right-of-ways for processes for highway running fiber optic cables; and concessions, while maintaining (c) leasing space for billboards and current standards of project other advertising. quality and profitability. • Seek acquisition opportunities. CCR believes that opportunities will arise to acquire participations in highway concessionaires in Brazil, as existing operators look for capital and funds for investments. • International expansion. CCR’s main network expansion strategy is focused on Brazil. However, the company will consider international expansion if attractive opportunities arise.

CCR Companhia de Concessões Rodoviárias | 19 Pernambuco

DF Goiás

Minas Gerais Mato Grosso Espírito do Sul Santo Future Road Concessions São Paulo (Company estimates) Rio de Current CCR’s Concessions Janeiro Paraná Polão Santa Second phase of the Federal Concession Program Catarina

Third phase of the Federal Rio Grande Concession Program do Sul São Paulo Highway Concession Program

| 04 Relatório de Administração 2001 Federal Highway Concession Program (second phase) Opportunities of Growth in New Concessions Program / Project Distance Period Estimated revenue The second phase of the Federal km years R$ million highway concession program is 116/SP/PR São Paulo - Curitiba 402.3 25 6,030 underway, involving 2,500 116/376/PR/ e 101/SC Curitiba - Florianópolis 367.6 25 4,050 kilometers to be privatized under seven separate concessions. On 381/MG/SP Belo Horizonte - São Paulo 561.5 25 4,720 February 18, 2002, the pre- 101/RJ Costa e Silva (Ponte) 320.8 25 2,360 qualification stage was completed

393/RJ Divisa MG/SP - BR 116/RJ 200.5 25 1,180 and CCR is included in the final stage for all upcoming concessions under 116/PR/SC Curitiba - Divisa SC/RS 407.5 25 1,540 this phase. The process is divided 153/SP Divisa MG/SP - Divisa SP/PR 322.5 25 1,410 into three stages and contracts are expected to be entered into in the Total 2,582.7 21,290 fourth quarter of 2002. CCR Projected revenues are based on projections provided by the DNER in its invitations to bid. considers itself as having a competitive advantage in the bidding, because of the expertise gained over the last six years of operating other concessions and its proven ability to arrange for the necessary financing, now enhanced by the company’s new access to the capital markets as a public company.

CCR Companhia de Concessões Rodoviárias | 05 Macro-economic Scenario in Brazil

Over the past three years, the Brazilian The trade balance surplus of U.S.$ economy has been volatile, due to a 2.6 billion registered in 2001 was floating exchange rate policy. During significant for Brazil’s foreign accounts, this time, the country has been facing since this was the first trade surplus a constant challenge: to keep inflation since 1994 (year of economic at low levels, with a real interest rate stabilization). that is sustainable, long-term, in terms The economic crisis in Argentina could of the cost of the public debt and have had a significant impact on the the growth of the gross domestic Brazilian economy, however its impact product (GDP). was in the end more contained than Despite a very promising beginning it was originally expected by for 2001, when the consensus of the international economists. Despite the Brazilian capital markets indicated an fact that its effects increased the expected GDP growth rate of between perceived risk for Latin America, 4 to 4.5% for the year, during the almost immediately it was noticeable year Brazil experienced a significant those effects were limited to economic slowdown as a result of Argentina. several factors, especially: high interest rates in Brazil; the devaluation of the Real against the U.S. dollar experienced during the first nine months of the year; the energy rationing program established by the government; the crisis in Argentina; and the global economic slowdown.

22 | Annual Report 2001 Main economic indicators

1999 2000 2001 GDP Real Growth (%) 0.5 4.4 1.5 GDP in R$ billion 960.9 1,089.7 1,176.9 GDP in US$ billion 529.1 596.8 500.4 Population (in million of inhabitants) 163.9 166.1 168.3 GDP per capita (US$) 3,277 3,593 2,973

Labor Unemployment Rate (%) 7.6 7.1 6.2

Inflation (% per year) IPCA-IBGE 8.9 6.0 7.7 IGP-M 20.1 10.0 10.4

Exchange Rate R$/US$ - end of period 1,789 1,955 2,320 R$/US$ - average 1,816 1,826 2,352

Interest Rate Nominal Interest Rate - CDI (% per year) 25.1 17.3 17.2 Real Interest Rate - IGP-M (% per year.) 4.2 6.7 6.2 Interest Rate over Exchange Rate (% per year) -15.5 7.4 -1.2

External Accounts Exportation (US$ billion) 48.0 55.1 58.2 Importation (US$ billion) 49.2 55.8 55.6 Trade Balance (US$ billion) -1.2 -0.7 2.6 Foreign Direct Investment (US$ billion) 28.6 32.8 22.6 International Reserves - Liquidity (US$ billion) 36.3 33.0 35.9

Source: Central Bank / IBGE.

CCR Companhia de Concessões Rodoviárias | 23 Corporate Governance Framework

CCR’s decision to be listed on the Among the commitments made by CCR New Market of the São Paulo Stock and its controlling shareholders are: Exchange, finalized on February 1, • The company’s obligation to 2002, implied that CCR intended to issue only common shares, thus comply with several corporate assuring the right to vote to all governance rules, generically called shareholders; ‘‘good practices of corporate governance.” • If there is a plan to transfer a controlling interest in CCR’s These rules are substantially more controlling shareholder, the rigid than those set forth by Brazilian controlling shareholder may only Corporate Law and expand the do so if the acquiror launches a rights of minority shareholders, tender offer for all the company’s improve the quality of information remaining shares on the same provided by companies to the terms and conditions available markets, and establish that to the selling controlling conflicts are to be resolved by an shareholder (“tag along” rights); arbitration board. • If shareholders approve CCR The commitment to abide to certain going private or the delisting disclosure requirements made by from the New Market, the price CCR to its current and new minority offered in the tender offer for shareholders is particularly all the company’s remaining important. It means the certainty shares should be determined by that all shareholders will share an independent appraisal report equally the growth of the company. calculated on net worth at book value or market price; and

24 | Annual Report 2001 • Distribute the maximum amount made by the controlling shareholders of dividends allowed under based on the number of Brazilian Corporate Law, while representatives to be appointed by respecting the company’s the minority shareholders, if multiple business plan. votes are allowed. In all cases, the controlling shareholders have the As to the company’s reporting right to appoint eleven members requirements, CCR committed to and the minority shareholders have abide, among other things, to the right to appoint the remainder. publish the following: In line with the company’s by-laws, • Quarterly financial statements; any shareholder may request • Annual financial statements in through their representative on the accordance with U.S. GAAP; Board of Directors an independent appraisal of any proposed • Information on contracts between transaction with a related party that CCR and related parties; and might represent a potential conflict • The Shareholders’ Agreement. of interest the aggregate amount of which is at least R$1 million.

Board of Directors Veto rights require a minimum quorum of 25% of the Board CCR’s by-laws require the Board of members. Directors to contain at least ten and up to twenty-one members. The number of members is to be decided at a general meeting of shareholders. The decision is to be

CCR Companhia de Concessões Rodoviárias | 25 Executive Officers three alternates, of which minority shareholders holding at least 10 % The executive officers are responsible of the voting shares are entitled to for CCR’s day-to-day management, elect one member and its alternate, are elected by the Board of Directors and our controlling shareholders are for two-year terms, and may be entitled to elect the remaining reelected. CCR might have a members. minimum of four and a maximum of eight executive officers.

Profit Sharing Plan Audit Council CCR has adopted a profit sharing plan, through which its executives CCR’s audit council is not permanent, but Brazilian Corporate and employees receive a bonus, Law requires the company to calculated based on the convene it when shareholders performance of the business and request it. Currently, shareholders individual limits set forth in such holding at least two percent of the program. Each concessionaire has company’s capital stock may request adopted a similar profit sharing plan. at any shareholders’ meeting that the audit council be established. The audit council, if to be convened, would not be permitted to be linked or subordinated to any other corporate body of CCR. CCR’s audit council is to be composed of three members and

26 | Annual Report 2001 Managerial Philosophy relationships and creating favorable prospects for business CCR’s business is defined as the development; management of the investments of all its shareholders, so as to • Forward looking guarantee strategic management administration, sustained by solutions that optimize the feasibility, proactive energy, by the security development and consolidation of of predictability, by reliable the business of public service information, and by professionally concessions, achieving maximum run negotiations; value and liquidity for the company. • The potential of human The general guiding principles of resources and their ability to add CCR’s managerial philosophy are: value and maximize the • The model for private competence of CCR’s business, concession of public services, as always working in an atmosphere a consistent basis for raising funds that brings value to the for infrastructure investments; engagement, and professional motivation, training, and • Satisfaction of highway users, development, that establishes as the basis for the success of the concrete perspectives for growth model for private concession of and achievement; and public services; • Adding value to the • Partnership with the financial management of the company, markets, as an instrument for based on autonomy, team leveraging the growth of the spirit, dialog, and transparent economy, of companies and of communications. society, and as a strengthening factor for the sustained development of CCR’s business; • The importance of the contribution of private enterprise, as a partner with the State in the progress of the country’s social, political, economic and environmental growth; • Professional and transparent management of the business, as an indispensable prerequisite for establishing healthy

CCR Companhia de Concessões Rodoviárias | 27

CCR’s Five Toll-Road Concessions

The position of CCR R$742.4 million for the previous GrossGross RevenueRevenue 2001(R$2001(R$ 932932 mm)mm) year. Consolidated EBITDA for the CCR is the largest holding company year rose to R$545 million, up by Rodonorte 15 % for highway concessions in Latin Ponte 5 % 30.4%, or R$127.1 million, America and one of the top in the from R$417.9 million recorded world. The company holds five for 2000. concessions, all in Brazil, collects tolls, provides additional services and is responsible under the terms of each concession for the repair, improvement and quality of service for remaining terms of between 13 AutoBAn 42 % Lagos 3 % to 20 years. CCR focuses NovaDutra 35 % investments on concessions with established traffic histories. EBITDA 2001 (R$ 545 mm) For the year, CCR’s posted consolidated gross revenues of Rodonorte 13 % R$931.7 million, reflecting a year- Ponte 3 % over-year increase of 25.5% from

AutoBAn 51 % Lagos 3 %

NovaDutra 30 %

Features The Anhangüera – Bandeirantes System, connecting the State capital with the main economic hub in the interior of the State. The concession was granted in 1998, and accounted for 41.5% of CCR’s gross operating revenues in 2001. In terms of revenues, the road is the largest concession highway granted in the State of São Paulo.

Length: 316.9 km Concession period: 20 years Main Financial Information (R$ million) Remaining concession period: 16 years

Grantor: São Paulo State Government 76% Type of bid: largest offer for the Granting Rights Annual toll readjustment (July): IGP-M 73% Investiments through 12/31/2001: R$ 864.5 million, of which 36.4% for 2001. 74% Number of toll plazas: 8

Equivalent Vehicles by Toll Plaza (in units)

236 174 270 197 373 283 Basic Tariff 1999 2000 2001 (12/31/2001) 1999 2000 2001 Campo Limpo R$ 6.20 18,010,072 18,644,779 21,095,809 Perus R$ 6.20 5,974,326 5,898,216 6,861,961 Net Revenue Itupeva R$ 6.00 8,574,863 9,343,185 13,467,238 EBITDA Valinhos R$ 6.00 4,750,176 4,300,503 5,401,390 EBITDA Margin Nova Odessa R$ 5.40 11,252,244 11,058,631 11,372,157 Sumaré R$ 5.40 - - 977,574 Limeira R$ 4.00 7,759,485 8,325,384 9,910,159 Tariff Readjustment Indexes Limeira 2* R$ 4.00 - - 102,236 Total 56,321,166 57,570,696 69,188,522

1.6

Historical Revenue by Toll Plaza 1.4 (in R$ million)

1999 2000 2001 1.2 Campo Limpo 82,977 95,182 122,713 Perus 27,533 30,136 39,890 Itupeva 39,471 47,769 77,001 1.0 Valinhos 21,855 21,958 30,886 Nova Odessa 46,109 49,851 58,009 Sumaré - - 5,195 0.8 Jun/98 Aug/99 Oct/00 Dec/01 Limeira 24,063 28,421 37,725 Limeira 2* - - 409 AutoBAn Total 242,008 273,317 371,827 AutoBAn Index *New Plaza at Bandeirantes which began to operate on December 15, 2001. FIPE IPC

CCR Companhia de Concessões Rodoviárias | 31 | 04 Relatório de Administração 2001 Features The main highway in the country, connecting the cities of São Paulo and Rio de Janeiro and also connecting other major industrial centers of the two States: Resende, Volta Redonda and Barra Mansa, in Rio de Janeiro; and, São José dos Campos, Taubaté and Jacareí, in São Paulo. The concession of the Presidente Dutra Highway, or Via Dutra, was granted in 1995. The concession represented 35.0% of CCR’s gross operating revenues in 2001.

Length: 402.3 km Concessio period: 25 years Main Financial Information (R$ million) Remaining concession period: 19 years Grantor: Federal Government 54% Type of bid: lowest toll rate 55% Annual toll readjustment (August): FGV industry indexes 56% Investments through 12/31/2001: R$ 759.5 milhões, of which 9.9% for 2001. Number of toll plazas: 5

Equivalent Vehicles by Toll Plaza 237133 269148 299 161 (in units) 1999 2000 2001

Basic Tariff 1999 2000 2001 Net Revenue (12/31/2001) EBITDA Parateí R$ 2.20 21,774,550 22,608,000 24,453,888 EBITDA Margin Moreira César R$ 4.50 19,557,227 19,486,309 19,065,175 Itatiaia R$ 4.50 16,095,925 16,299,065 16,240,094 Viúva Graça R$ 4.50 14,283,143 13,752,593 12,192,101 Jacareí R$ 2.00 - - 12,412,207 Tariff Readjustment Indexes Total 71,710,845 72,145,967 84,363,465

1.6

Historical Revenue by Toll Plaza 1.4 (in R$ million)

1999 2000 2001 1.2 Parateí 73,920 88,161 82,904 Moreira César 66,364 76,019 82,845 1.0 Itatiaia 54,533 63,611 70,668 Viúva Graça 48,392 53,779 53,022 Jacareí - - 24,959 0.8 Total 243,209 281,570 314,398 Aug/96 Dec/97 Apr/99 Aug/00 Dec/01 NovaDutra Real NovaDutra Index FIPE IPC

CCR Companhia de Concessões Rodoviárias | 33 | 04 Relatório de Administração 2001 Features Rodonorte represents the natural route from the Londrina region to Curitiba and the Port of Paranaguá. It connects the main agricultural centers in the State. The concession of the Rodonorte highway system was granted in 1997, and was responsible for 15.0% of CCR’s gross operating revenues in 2001. The system is the largest of the six concessions granted within the Highway Concession Program of the State of Paraná in terms of length, investments required, and toll collection. Length: 487.5 km Concession period: 24 years Remaining concession period: 19 years Grantor: Paraná State Government Type of bid: largest offer for maintaining access roads Annual toll readjustment (August): IGP-M and FGV industry indexes Main Financial Information (R$ million) Investments through 12/31/2001: R$ 241.0 million, of which 44.7% for 2001. Number of toll plaza: 7 54% 51% 45%

Equivalent Vehicles by Toll Plaza (in units)

Basic Tariff 1999 2000 2001 57 26 94 48 128 69 (12/31/2001) São Luis do Purunã R$ 3.00 12,243,194 11,459,721 12,545,348 1999 2000 2001 Witmarsun R$ 4.40 8,149,447 7,674,445 8,505,035 Carambeí R$ 3.60 6,619,513 6,135,745 6,498,841 Net Revenue EBITDA Jaguariaíva R$ 2.80 3,981,050 3,581,958 3,322,669 EBITDA Margin Tibagi R$ 4.10 3,351,344 3,127,703 3,155,224 Imbaú R$ 4.10 2,881,747 2,729,798 2,790,468 Mauá da Serra R$ 4.10 2,872,228 2,723,505 2,830,073 Total 40,098,523 37,432,875 39,647,657 Tariff Readjustment Indexes

Historical Revenue by Toll Plaza 1.6 (in R$ million) 1.4

1999 2000 2001 1.2 São Luis do Purunã 13,827 24,437 35,394 1.0 Witmarsun 15,188 23,654 32,923 0.8 Carambeí 9,644 14,837 20,447 0.6 Jaguariaíva 4,610 6,918 8,678 0.4 Tibagi 5,816 8,986 12,359 Jun/98 Aug/99 Oct/00 Dec/01 Imbaú 5,023 7,840 10,688 Rodonorte Mauá da Serra 5,016 7,821 10,841 Rodonorte Index Total 59,124 94,493 131,331 FIPE IPC

CCR Companhia de Concessões Rodoviárias | 35 | 04 Relatório de Administração 2001 Features The bridge, or Ponte, is the main link between the cities of Rio de Janeiro and Niterói. The concession of the Ponte Rio-Niterói was granted in 1994 and was responsible for 5.2% of CCR’s gross operating revenues in 2001. The Ponte was the first highway privatized under the Federal highway concession program.

Length: 13.3 km Concession period: 20 years Remaining concession period: 13 years Grantor: Federal Government Type of bid: lowest toll rate Main Financial Information Annual toll readjustment (August): FGV industry indexes (R$ million) Investments through 12/31/2001: R$ 76.8 milhões, of which 14.5% for 2001. Number of toll plazas: 1 30% 39% 37%

Equivalent Vehicles by Toll Plaza 36 11 44 17 45 17 (in units) 1999 2000 2001

Basic Tariff 1999 2000 2001 Net Revenue (12/31/2001) EBITDA Niterói R$ 2.00 25,926,189 25,401,633 25,518,566 EBITDA Margin Total 25,926,189 25,401,633 25,518,566

Tariff Readjustment Indexes

1.6

1.4 Historical Revenue by Toll Plaza (in R$ million) 1.2 1999 2000 2001 Niterói 35,380 40,061 44,498 1.0 Total 35,380 40,061 44,498

0.8 Aug/96 Dec/97 Apr/99 Aug/00 Dec/01 Ponte Rio-Niterói Ponte Rio-Niterói Index FIPE IPC

CCR Companhia de Concessões Rodoviárias | 37

Features The road provides access to the Lagos region, one of the most important tourist destination in the State of Rio de Janeiro and the nation. The region receives a significant number of summer vacationers who use the highway’s network. The concession of the Lagos highway system was granted in 1996, and was responsible for 2.8% of CCR’s gross operating revenues in 2001. Length: 60.0 km Concession period: 25 years Remaining concession period: 19 years Grantor: Rio de Janeiro State Government Annual toll readjustment (August): FGV industry indexes Main Financial Information Investments through 12/31/2001: R$ 87.0 million, of which 0.6% for 2001. (R$ million) Number of toll plazas: 1

64% 58% 61%

Equivalent Vehicles by Toll Plaza 22 13 21 13 24 15 (in units) 1999 2000 2001

Basic Tariff 1999 2000 2001 Net Revenue (12/31/2001) EBITDA Latino Mello R$ 4.70 4,876,273 4,509,941 4,653,568 EBITDA Margin Total 4,876,273 4,509,941 4,653,568

Tariff Readjustment Indexes

1.6 Historical Revenue by Toll Plaza 1.4 (in R$ million) 1.2 1999 2000 2001 1.0 Latino Mello 22,220 22,119 26,089 0.8 Total 22,220 22,119 26,089 0.6 0.4 Aug/97 Sept/98 Oct/99 Nov/00 Dec/01

Via Lagos Via Lagos Index FIPE IPC

CCR Companhia de Concessões Rodoviárias | 39

Management’s Analysis of Results for Fiscal Years 2001 Management’s Analysis of Results for Fiscal Years 2001

Results of operations for fiscal year 2001

a) Gross Operating Revenues

2000 2001 R$MM % consolidated % consolidated variation gross revenue R$MM gross revenue % AutoBAn 280.4 37.8% 386.5 41.5% 37.9% NovaDutra 290.2 39.1% 326.3 35.0% 12.4% Rodonorte 100.0 13.5% 139.3 15.0% 39.3% Via Lagos 22.5 3.0% 26.5 2.8% 17.9% Ponte 46.5 6.3% 48.8 5.2% 4.8% Parques 0.2 0.0% 0.8 0.1% 222.0% CCR 2.6 0.3% 3.5 0.4% 36.6% Consolidated 742.4 100.0% 931.7 100.0% 25.5%

CCR’s gross operating revenues for the year was R$931.7 million, representing a 25.5% increase, or R$189.3 million, from R$742.4 million for the previous year. All of the company’s five concessions showed similar improvements for the year. AutoBAn and NovaDutra continued to contribute a significant portion of the company’s total gross operating revenues, with 41.5% and 35.0%, respectively. Toll revenues represented 95.7%, or R$ 891.6 million, of CCR’s total revenues for the year. In 2000, toll revenues represented 95.9%. In absolute figures, other sources of revenues for the period rose year-over- year by 30.2%, or R$ 9.3 million, mainly due to signing new contracts for the right to lay fiber optical cable along the concessions. The following table shows traffic figures at each of the five concessionaires in terms of equivalent vehicles, which represent a basic reference unit for toll collection statistics in the Brazilian market. Equivalent vehicles are light vehicles, such as passenger cars, with two axles. Heavy vehicles, such as trucks and buses are converted into equivalent vehicles by a multiplier

Equivalent Vehicles by Concessionaire

1999 2000 2001 AutoBAn 56,321,166 57,570,696 69,188,522 NovaDutra 71,710,845 72,145,967 84,363,465 Rodonorte 40,098,523 37,432,875 39,647,657 Ponte 25,926,189 25,401,633 25,518,566 Via Lagos 4,876,273 4,509,941 4,653,568 Total 198,932,995 197,061,112 223,371,778

42 | Annual Report 2001 applied to the number of axles of the vehicle, as established in the terms of each concession contract. Traffic measured in terms of equivalent vehicles increased at all five concessions, with particularly strong growth rates shown by AutoBAn and NovaDutra. In the case of AutoBAn, traffic rose by 20.2% as in March 2001 the company started to collect the toll in both directions for commercial vehicles (trucks and buses) at the first four plazas. The other plazas began charging in both directions on February 4, 2002. a.1) Toll Readjustment

Annual Readjustment Readjustment Indexes 2001 Readjustment 1(%) AutoBAn July IGP-M 11.1 NovaDutra August FGV industry index 7.8 Rodonorte December FGV industry index 8.1 Ponte August FGV industry index 5.9 Via Lagos August FGV industry index 6.7 (1) Contratual Readjustment: variation from 2000 to 2001 The table above outlines the toll readjustment dates of each concession, as well as the percentages by which the tolls were readjusted on the respective dates. b) Taxes and Contributions

2000 2001 R$MM % gross % gross variation revenue R$MM revenue % AutoBAn 10.5 3.7% 14.0 3.6% 34.0% NovaDutra 21.1 7.3% 27.4 8.4% 30.1% Rodonorte 6.4 6.4% 11.8 8.4% 84.2% Via Lagos 1.9 8.6% 2.3 8.6% 17.9% Ponte 3.0 6.4% 4.1 8.4% 37.3% Parques 0.0 3.6% 0.0 4.7% 318.4% CCR 1.0 40.5% 1.8 51.0% 72.0% Consolidated 43.9 5.91% 61.4 6.6% 39.9% Taxes on gross operating revenues for the year grew by 39.9%, or R$17.5 million. The total taxes on gross revenues for the year rose to 6.6%, from 5.9% for 2000. This increase mainly reflects the increased rate of Service Tax (ISS) collection that several cities began charging on January 2001 and that, until then, had not been supported by legislation that allowed the municipalities to implement this charge. Therefore, NovaDutra, Rodonorte, and Ponte showed an increase in the relation of taxes paid to the concessions’ gross operating revenues.

CCR Companhia de Concessões Rodoviárias | 43 c) Cost of Services

2000 2001 R$MM % gross % gross variation revenue R$MM revenue % AutoBAn 194.7 69.4% 228.8 59.2% 17.5% NovaDutra 155.6 53.6% 163.1 50.0% 4.8% Rodonorte 44.6 44.6% 66.5 47.7% 49.0% Via Lagos 10.1 44.9% 10.4 39.2% 2.9% Ponte 22.0 47.4% 21.1 43.3% -4.1% Parques 0.0 3.0% 0.0 0.0% -100.0% CCR -8.6 na -12.7 na 47.7% Consolidated 418.4 56.4% 477.2 51.2% 14.0%

The cost of services increased for the year by 14.0%, or R$58.8 million. Cost of services increased, as in previous years, at a rate lower than the revenue growth for the same period, thus resulting in an improvement in the company’s operating margins. At all of our concessionaires, with the exception of Rodonorte, cost of services as a percentage of gross operating revenues diminished, going down on a consolidated percentage to 51.2%, from 56.4% for the previous year. When in March 2001 the toll rates for Rodonorte were readjusted following a one-year temporary reduction, the concessionaire began to operate at service levels much higher than over the previous year, resulting in an increase in the cost of services. The main cost components of the services provided are discussed as follows.

c.1) Depreciation and Amortization

2000 2001 R$MM % R$MM % variation % AutoBAn 134.8 69.3% 153.7 67.2% 14.0% NovaDutra 59.0 37.9% 57.4 35.2% -2.7% Rodonorte 14.7 32.9% 23.0 34.6% 56.9% Via Lagos 6.9 68.6% 7.1 68.7% 3.1% Ponte 9.4 42.6% 7.5 35.4% -20.3% Consolidated 224.8 53.7% 248.7 52.1% 10.6%

Depreciation and amortization continued to represent a large portion of the cost of services provided, going for the year to 52.1%, from 53.7% for 2000. In particular, depreciation costs for the period rose at AutoBAn as the beginning of operations in June 2001 of the first section of the extension of the Bandeirantes Highway substantially increased the

44 | Annual Report 2001 concession’s depreciable permanent assets. The second section of the extension went into operation in December 2001, increasing the concession’s depreciable permanent assets for the last quarter, although the effects of this increase will only be felt as of 2002. c.2) Outsourced Services

2000 2001 R$MM % R$MM % variation % AutoBAn 10.7 5.5% 9.9 4.3% -7.4% NovaDutra 92.9 59.7% 102.0 62.6% 9.9% Rodonorte 11.8 26.4% 38.0 57.2% 222.5% Via Lagos 3.2 31.4% 3.3 31.3% 2.6% Ponte 12.6 57.2% 13.6 64.4% 7.9% CCR -8.6 na -12.7 na 47.8% Consolidated 122.6 29.3% 154.2 32.3% 25.8%

Like depreciation and amortization, outsourced services represented a significant item in the cost structure of CCR. In 2001, these services grew by 36.7%, or R$ 41.4 million, over 2000. The main variation noted in this line item has to do with Rodonorte, as Coparques started operations in August 2001. c.3) Routine Conservation

2000 2001 R$MM % R$MM % variation % AutoBAn 11.9 6.1% 17.1 7.5% 43.8% NovaDutra - - - - na Rodonorte 13.6 30.4% - - -99.9% Via Lagos - - - - - Ponte - - - - - Consolidated 25.5 6.1% 17.2 3.6% -32.6%

Maintenance costs for the period declined sharply, mainly as a result of the above-mentioned starting of operations of Coparques in August 2001. The costs that had been posted to this account began to be included in the outsourced services line, as mentioned earlier. Other items making up the cost of services increased by 31.1%, or R$13.5 million, to R$ 57.1 million, from R$ 43.6 million for 2000.

CCR Companhia de Concessões Rodoviárias | 45 The variable concession fee payment by AutoBAn to the Government of the State of São Paulo is equivalent to 3% of that concessionaire’s revenues. For 2001, this payment rose by 37.8% in line with the revenue increase at AutoBAn for the period to R$11.6 million, from R$8.4 million for 2000.

d) Administrative Expenses

2000 2001 R$MM % total R$MM % total variation % AutoBAn 12.7 13.6% 14.3 14.2% 12.9% NovaDutra 25.5 27.4% 32.8 32.5% 28.6% Rodonorte 20.2 21.6% 18.8 18.6% -6.7% Via Lagos 5.6 6.0% 5.6 5.5% 0.1% Ponte 14.4 15.4% 14.4 14.3% 0.2% Parques 0.2 0.2% 0.5 0.5% 164.2% CCR 14.6 15.7% 14.4 14.3% -1.4% Consolidated 93.1 100.0% 100.9 100.0% 8.3%

Administrative expenses for the period rose slightly by 8.3% to R$100.9 million, from R$93.1 million for 2000. NovaDutra experienced a significant increase in this item in connection with legal fees resulting from the implementation process of the Jacareí toll plaza. e) Monetary Adjustment to Concession Fee Obligation The monetary adjustment to concession fee obligation for 2001 rose slightly by 8.3%, or R$13.8 million, to R$180 million, from R$166.1 million for 2000. The reason for the increase in this item was the slight year-over- year increase in the inflation rate for the country. f) Exchange Rate Variation The exchange rate variation increase substantially for the year, by 168%, or R$70 million, as a result of the substantial devaluation of the Real against the U.S. dollar. The Brazilian currency devaluated by 18.7% for 2001, against 9.3% for 2000. Furthermore, the company’s debt in U.S. dollars increased in the period to R$583 million on 12/31/2001, from R$542.4 million on 12/31/2000. g) Interest and Other Financial Expenses Interest and other financial expenses for 2001 rose by 25.7%, or R$39.2 million, to R$191.2 million, from R$152.1 million for the previous year. This was mainly the result of the consolidation of a greater level of debt, especially because of AutoBAn.

46 | Annual Report 2001 h) Financial Income Financial income for the year increased by 19.7%, or R$3.1 million, to R$18.7 million, from R$15.6 million for 2000. The variation in this line was due to gains of Rodonorte’s swap operations in U.S. dollars, as well as cash investments by the concessionaires. i) Income and Social Contribution Taxes Income tax credits of R$55.7 million and R$35.3 million were registered for 2000 and 2001, respectively, a decrease of R$20.4 million or 36.6%. Social contribution tax credits decreased by R$ 6 million, or 31.5%, to R$13 million from R$19.0 million for 2000. In 2000, Rodonorte had deferred R$26.5 million income and social contribution taxes for 1999 and 2000, because in 1999 the concessionaire had charged only a half of the toll and expected no profits. j) Minority Interest The effect of minority participation, especially with respect to Rodonorte, was to increase CCR’s losses by R$695,000 in 2001 and R$6.3 million for 2000, due to the fact that Rodonorte had net profits of R$24.3 million for 2000 and R$2.6 million for 2001. k) Gross Income Gross income for 2001 was R$393.1 million, reflecting a growth of 40.4% from R$280.1 million for the previous year. Consequently, operating margin to 45.2%, from 40.1% for 2000. l) EBITDA EBITDA for the year, calculated by adding back to the net income, interest (and other financial expenses), taxes, depreciation and amortization, reached R$545 million, reflecting a year-over-year improvement of 30.4%, or R$127.1 million, from R$417.9 million for 2000. As a result of the greater proportional growth of the company’s net revenues, compared with the evolution of company’s cash operating expenses, EBITDA margin for the year was a record 62.6%, up from 59.8% for 2000. m) Operating Results (EBIT) As a result of the above, mainly the exchange rate variation, CCR’s operating losses for the year rose year-over-year by 9.3%, or R$14.6 million, to R$171.9 million.

CCR Companhia de Concessões Rodoviárias | 47 n) Net Loss Similarly, as explained above, CCR’s net losses for fiscal year 2001 increased by 48.2%, or R$40.8 million, to R$125.4 million, from R$84.6 million for 2000.

Financial Review a) Indebtedness The company’s indebtedness on December 31, 2001, was R$1,405.5 billion, compared with R$1,129.8 billion on December 31, 2000. In 2001, 58.5% of the company’s total indebtedness was in reais and 82.1% was long-term. All five CCR concessionaires engage in project finance, so there is no risk of financing contracts for the projects. The toll revenues are a guarantee for the lenders, allowing long-term financing at low cost.

(in R$ million) 1999 2000 2001 Short-term 380.3 315.4 251.7 % Total 47.0% 27.9% 17.9% Long-term 429.1 814.3 1,153.7 % Total 53.0% 72.1% 82.1% Total Indebtedness 809.4 1,129.8 1,405.5 In Reais 429.3 587.4 822.4 % Total 53.0% 52.0% 58.5% In US Dollar 380.2 542.4 583.0 % Total 47.0% 48.0% 41.5%

In addition to project finance, CCR and its concessionaires have access to complementary loan agreements.

Lender Cost of Debt Position on 12/31/2001 (R$mm)

in R$ in US$ in R$ in US$ Total Maturity

AutoBAn BID, IFC and BNDES TJLP + 5.0% Libor + 4.25% a 4.625% 224,470 314,516 538,986 2008 to 2012 NovaDutra IFC and BNDES TJLP + 5.5% Libor + 3.50% a 3.75% 130,356 177,238 307,594 2005 to 2008 Rodonorte Debentures and BNDES IGP-M + 12% and TJLP +5.0% 178,096 178,096 2010 to 2011 Ponte BNDES TJLP + 5.5% 34,856 34,856 2006 Via Lagos BID and BNDES TJLP + 5.0% Libor + 4.25% a 4.50% 25,345 57,641 82,986 2007 to 2011 Total 593,123 549,395 1,142,518

By using part of the funds of the initial public offering, on January 31, 2002, the company paid down R$150 million of its net consolidated indebtedness, thus eliminating the loans that CCR had with shareholders and purchasing credit for AutoBAn.

48 | Annual Report 2001 Lender Cost of Debt Position on 12/31/2001 (R$mm)

in R$ in US$ in R$ in US$ Total Maturity CCR Debentures CDI + 1.0% 64,702 - 64,702 2003 CCR Loan with Shareholders CDI + 1.0% 100,307 - 100,307 February/2002 AutoBAn Subordinated debt IGP-M + 12.0% 82,376 82,376 Indeterminate1 AutoBAn Supplier Libor + 0.75% 4,176 4,176 May/2003 NovaDutra Supplier Libor + 1.00% 21,468 21,468 March/2005 Ponte Swap 110.8% CDI 22,835 22,835 August/2003 Via Lagos Subordinated debt IGP-M + 12.0% 2,833 2,833 Indeterminate1 Total 273,053 25,644 298,697

(1) Subject to contratual restrictions b) Exposure to Market Risks Exchange: CCR is subject to exchange risks, due to the volume of financing which is indexed to the U.S. dollar. The company’s indebtedness on December 31, 2001, was R$1,405.5 billion, of which 41.5% was in U.S. dollars and 82.1% long-term. CCR has no assets in U.S. dollars, and performs no relevant operations with derivatives, to protect itself against exchange rate devaluations. Interest Rate: the exposure of the company to floating interest rates is mainly related to variations: (i) of the Libor, on loans taken in U.S. dollars; (ii) of the TJLP, for local medium and long-term loans; and (iii) of the CDI, for other local loans. On December 31, 2001, the average interest rate of the company’s debt in reais was the TJLP + 5% for BNDES loans and CDI + 1% for other structures. The debt in U.S. dollars had an average rate of the Libor + 4%. c) Liquidity and Capital Resources Through December 2001, and for a period of six years, over R$2.0 billion were invested in the concessionaires, of which the company’s shareholders had contributed over R$450 million . The target capital structure for financing the investments in the concessionaires is 60% through debt, 20% through cash generated internally and 20% through equity financing. Today, about 80% of the investments planned for the first 10 years when the concessions were first won, have already been made. Through 2005, investments for additional R$559 million are expected, of which approximately R$130 million will be invested in Rodonorte, in 2002. That investment will be financed with cash generated internally and, in Rodonorte’s case, with funds already contracted from the BNDES (approximately R$90 million).

CCR Companhia de Concessões Rodoviárias | 49

Social and Environmental Report Social and Environmental Report

Improvements and Safety reflecting a decrease of 9.1%, or CCR and each of its 771 injured, from 1999. Over the concessionaires are fully same period, the number of fatal committed to continuously accidents on the company’s improve their highway network highways dropped by 24.8%. to guarantee the safety and Our accident-prevention strategy comfort for all highway users. gives priority to the installation and Statistics show that since the the acquisition of new safety concessionaires took over the equipment, such as pedestrian management of these highways, overpasses, concrete barriers, speed Number of Fatal Accidents the number of accidents declined limit controls, better signage, on CCR Concessions and an increasing number of lives widening of the highways, greater are saved each year. Everyone at availability of doctors, ambulances 760 750 CCR and its concessionaires is and emergency telephones, and the 740 extremely proud of this record, removal of animals from the 720 nevertheless everyone looks at it highways. 700 only as incentive to improve it each day. In recognition of the 680 666 reduction in fatal accidents over Social Responsibility 660 its highway network, CCR has CCR is aware of its social 640 received several awards. responsibilities as a provider of a 620 In 2001, a total of 17,249 public service and encourages its 600 accidents took place on CCR’s concessionaires to develop projects 580 564 highways, representing a decline directed toward highway users, such 560 of 9.2%, or 1,756 accidents, as the health of truck drivers and 540 when compared with 1999. The the population of the communities 1999 2000 2001 number of injured was 8,048, also surrounding its highways, including

52 | Annual Report 2001 maternity assistance programs. This several companies and is in addition to activities for the institutions, the program preservation of the environment provides services like measuring and education. Among others, CCR blood pressure, eye and blood and its concessionaires are engaged exams, in addition to checking in the following activities : weight and height and other. • VidaBAn – Truck Driver Health • RodoPac. This is a broad Program. The objective is to reaching social program that raise the awareness among truck supports truck driver safety in an drivers of the benefits of a essential area: health. In 2001, healthier lifestyle. The program over 4,500 truck drivers received includes psychological, heart, orientation and a series of free vision, blood pressure, weight medical services: doctor and height tests and sleep appointments, exams including disorders. Additionally, blood diabetes, cholesterol, exams, a basic dental evaluation, triglycerides, electrocardiogram, and free barber services. vision test, blood pressure, body • “Life on the Dutra is Health” mass measurement, Safe Sex Program. Launched in workshops, which includes September 2001, the program information regarding sexually focuses specifically on the health transmitted diseases and and welfare of truck drivers distribution of condoms, and transiting on the Via Dutra and preventive dental treatment. attempts to provide information • Dutra Kids Campaign. on personal care as well as free Developed with students from medical checkups for highway the public school systems of the users. Done in partnership with cities adjacent to the highway,

CCR Companhia de Concessões Rodoviárias | 53 and in conjunction with the the highway’s scenery, especially Federal Highway Police (PRF), the in its urban sections. As part of objective is to teach traffic laws program, in Guarulhos Haroldo to children in an effort to prepare J. Santos, the artist, launched future drivers. The program “Colorful Street” Project, in which seeks to involve children in vandals are turned into graffiti respecting the highways with artists. two types of actions: first, Environmental Aspects students attend talks on Traffic Safety, prepared in language In order to maintain and operate focusing on Children’s Day. highways in Brazil, the Second, part of the students concessionaires must follow participate in an action on the administrative procedures related to highway, at a Federal Highway the concession of environmental Police post, passing on to licenses. The construction, passenger vehicle drives the preparation, operation and things that they learned. expansion of facilities and/or activities that have an actual or • AutoBAn Traffic Education. potential polluting effect, as well as In this project, which is developed those that in any way may cause in partnership with the damage to the environment, require governments of the 17 prior licensing from the appropriate municipalities located in the area State agency. The licenses establish surrounding the two highways the conditions, restrictions and and Editora Kalimera, AutoBAn inspection schedule applicable to takes another important step the enterprise. toward reducing the current accident rates on its highways, In addition to criminal liability, failure by completing the composition to obtain the required environmental of engineering, inspection and licenses may result in several education, which is essential for penalties under State legislation, saving lives. About 50,000 such as notice, fine, temporary or primary and junior high school permanent interdiction, embargo, students from the public school demolition, the suspension of system are expected to be subsidies from public agencies, and exposed to this project. temporary or permanent closure of the enterprise. • Dutra Graffiti Project. Within the program for commemorating CCR has already obtained the the 50th Anniversary of the relevant environmental licenses or Dutra, NovaDutra launched the is in the process of obtaining any Dutra Graffiti Project to revitalize that it may still be missing.

54 | Annual Report 2001 Awards • The “The Biggest in Transportation”, of Transporte The responsibility and dedication of Moderno magazine, ranked the concessionaires are recognized NovaDutra in first place in the by the public and, mainly, by sector of Highway Concessions highway users. Annual opinion polls for the first time in 2001; show the satisfaction of highway users with respect to the services • For the second consecutive year, provided and the improvements AutoBAn received the Top carried out during CCR’s Quality Award, given by The management of the concessions. Institute for Quality Studies and Among the many awards received Research (IQ), in partnership with recently are: Camplux Editora e Publicações; • Innovation on Highways 2001 • AutoBAn Notícias magazine Award (IBTTA). With the “I’m a received an award from the 10 in Traffic”, Rodonorte also Brazilian Association of Business won the Innovation in Highways Communication (Aberje), as the 2001 Award. This is the second best publication in São Paulo in time that the concessionaire has 2001, in the category of External received the award from IBTTA, Company Publication. an entity that brings together highway administration companies from all over the world. • In 2001, NovaDutra received the ABRH (Brazilian Human Resources Association) Award in the Company category;

CCR Companhia de Concessões Rodoviárias | 55 Acknowledgements

CCR wishes to thank four groups, without which we would not be celebrating the results achieved in 2001: • The granting authorities, that were able to recognize private initiative as the right road to perfect and develop the highway system in Brazil in an effective and socially responsible manner; • Financing agents and, especially, those who successfully structured the project finance operations, assuring support and facilitating CCR’s growth in the highway concession business; • The new shareholders who, on January 31, 2002, joined the company’s shareholding structure, which broke new ground when it listed on the New market of the São Paulo Stock Exchange; • All of CCR’s collaborators, who honored the responsibility placed upon them by the shareholders to manage their financial resources. The renewed economic growth of Brazil in 2002, and the expectations regarding the bidding process for seven new highway concessions, as part of the second phase of the Federal program, involving 2,500 kilometers, which is expected to be concluded in the fourth quarter of 2002, reinforce the company’s expectation for continued growth. Financial Statements (Brazilian Corporate Law)

Independent Auditors’ Report (Convenience translation into English from the Financial Statements Previously Issued in Portuguese)

To the Shareholders and Management of Companhia de Concessões Rodoviárias São Paulo - SP, Brazil

1. We have audited the accompanying balance sheets of Companhia de Concessões Rodoviárias and subsidiaries (Company and consolidated) as of December 31, 2001 and 2000, and the related the statements of loss, changes in shareholders’ deficit (Company) and changes in financial position for the years then ended. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits. 2. We conducted our audits in accordance with auditing standards generally accepted in Brazil which include: (a) planning of the engagement, considering the materiality of the balances, the volume of transactions and the accounting and internal control system of the Company; (b) examination, on a test basis, of the evidence and records supporting the amounts and disclosures in the financial statements; and (c) assessment of the accounting principles used and significant estimates made by management of the Company, as well as the evaluation of the overall financial statement presentation. 3. In our opinion, such financial statements referred to in the first paragraph present fairly, in all material respects, the financial position of Companhia de Concessões Rodoviárias and subsidiaries (Company and consolidated) at December 31, 2001 and 2000, the results of their operations, the changes in their shareholders’ deficit (Company) and the changes in their financial position for the years then ended, in accordance with generally accepted accounting principles established by Brazilian Corporate Law. 4. Additionally, we examined the consolidated statements of cash flows for the years ended December 31, 2001 and 2000, included in Note 16 to the financial statements, which are being presented for purposes of additional analysis and are not a required part of the basic financial statements under accounting practices established by Brazilian Corporate Law. Such information has been subjected to the audit procedures referred to in the second paragraph and, in our opinion, is fairly stated in all material respects in relation to the basic financial statements taken as a whole.

February 6, 2002

DELOITTE TOUCHE TOHMATSU José Roberto P. Carneiro Auditores Independentes Contador CRC nº. 2 SP 011609/O-8 CRC nº. 1 SP 109447/O-6

CCR Companhia de Concessões Rodoviárias | 59 Consolidated Balance Sheets As of December 31, 2001 and 2000 (expressed in thousands of Brazilian reais - R$)

Company Consolidated 2001 2000 2001 2000 ASSETS R$ R$ R$ R$ CURRENT ASSETS Cash and banks 726 2,213 35,215 28,194 Short-term investments 8,632 2,004 32,302 43,347 Other accounts receivable 3,489 1,904 21,260 19,734 Recoverable income taxes 5,548 1,696 11,969 4,467 Prepaid expenses 1,067 923 4,844 4,521 Total current assets 19,462 8,740 105,590 100,263

LONG-TERM ASSETS Restricted deposits - - 11,697 41,181 Deferred income and social contribution taxes - - 252,717 200,414 Related parties 59,621 12,623 - - Other 855 1,397 25,382 7,945 Total long-term assets 60,476 14,020 289,796 249,540

PERMANENT ASSETS Investments 191,680 163,066 - - Property and equipment, net Transferred from the concession grantors - - 1,329,437 1,452,477 Additions and improvements 838 666 1,633,913 1,248,077 838 666 2,963,350 2,700,554 Deferred charges, net 2,009 - 14,823 21,740 Total permanent assets 194,527 163,732 2,978,173 2,722,294

TOTAL 274,465 186,492 3,373,559 3,072,097

See notes to financial statements.

60 | Annual Report 2001 Company Consolidated 2001 2000 2001 2000 LIABILITIES AND SHAREHOLDERS’ DEFICIT R$ R$ R$ R$ CURRENT LIABILITIES Short-term debt and current maturities of long-term debt 34,702 32,073 150,885 288,994 Loans from related parties 100,838 26,453 100,838 26,453 Concession fee obliglation - - 114,139 104,589 Accounts payable - related parties - - 46,430 60,021 Accounts payable - suppliers 23 72 14,109 21,326 Other accounts payable - - 35,179 18,896 Accrued payroll and related liabilities 599 861 12,385 11,554 Taxes and contributions payable 880 425 11,172 7,511 Total current liabilities 137,042 59,884 485,137 539,344

LONG-TERM LIABILITIES Concession fee obligation - - 1,840,594 1,772,896 Long-term debt 30,000 64,146 1,105,963 811,624 Provision for losses on investments 235,075 131,729 - - Loans from related parties 2,814 2,814 47,776 2,719 Accounts payable - related parties - - 4,047 4,066 Other accounts payable - - 14,097 16,312 Total long-term liabilities 267,889 198,689 3,012,477 2,607,617

MINORITY INTEREST --6,411 (2,783)

SHAREHOLDERS’ DEFICIT Capital stock 111,416 44,412 111,416 44,412 Accumulated deficit (241,882) (116,493) (241,882) (116,493) Total shareholders’ deficit (130,466) (72,081) (130,466) (72,081)

TOTAL 274,465 186,492 3,373,559 3,072,097

See notes to financial statements.

CCR Companhia de Concessões Rodoviárias | 61 Statements of Loss For the years ended December 31, 2001 and 2000 (expressed in thousands of Brazilian reais - R$, except net loss per share amount)

Company Consolidated 2001 2000 2001 2000 R$ R$ R$ R$

GROSS OPERATING REVENUES 38,486 16,078 931,664 742,361

TAXES ON GROSS REVENUES (1,804) (1,049) (61,369) (43,863)

NET OPERATING REVENUES 36,682 15,029 870,295 698,498

COST OF SERVICES Depreciation and amortization - - (248,704) (224,795) Third-party services (18,656) (6,682) (154,224) (112,792) Other --(74,264) (80,845)

GROSS PROFIT 18,026 8,347 393,103 280,066

OPERATING INCOME (EXPENSES) Administrative expenses (18,088) (12,974) (100,850) (93,126) Financial expenses: Monetary adjustment to concession fee obligation - - (179,998) (166,173) Exchange rate variation (1) - (111,597) (41,621) Interest and other financial expenses (29,578) (10,189) (191,238) (152,087) Financial income 8.058 57 18,658 15,594 Equity in results of operations of subsidiares (103,806) (69,870) - -

OPERATIONAL LOSS (125,389) (84,629) (171,922) (157,347)

NONOPERATING INCOME (EXPENSES) --(1,135) 4.868

LOSS BEFORE INCOME AND SOCIAL CONTRIBUTION TAXES, PROFIT SHARING AND MINORITY INTEREST (125,389) (84,629) (173,057) (152,479)

INCOME AND SOCIAL CONTRIBUTION TAXES - CURRENT --(3,942) (5,252) INCOME AND SOCIAL CONTRIBUTION TAXES - DEFERRED --52,303 80,022

LOSS BEFORE PROFIT SHARING AND MINORITY INTEREST (125,389) (84,629) (124,696) (77,709)

PROFIT SHARING -- -(661)

LOSS BEFORE MINORITY INTEREST (125,389) (84,629) (124,696) (78,370)

MINORITY INTEREST --(693) (6,259)

NET LOSS (125,389) (84,629) (125,389) (84,629)

NET LOSS PER SHARE - R$ (1.85) (11.84)

See notes to financial statements.

62 | Annual Report 2001 Statements of Changes in Shareholders’ Deficit For the years ended December 31, 2001 and 2000 (expressed in thousands of Brazilian reais - R$)

Capital Accumalated stock deficit Total R$ R$ R$

BALANCES AS OF DECEMBER 31, 1999 44,412 (31,864) 12,548

Net loss - (84,629) (84,629)

BALANCES AS OF DECEMBER 31, 2000 44,412 (116,493) (72,081)

Capital increase 67,004 - 67,004 Net loss - (125,389) (125,389)

BALANCES AS OF DECEMBER 31, 2001 111,416 (241,882) (130,466)

See notes to financial statements.

CCR Companhia de Concessões Rodoviárias | 63 Statements of Changes in Financial Position For the years ended December 31, 2001 and 2000 (expressed in thousands of Brazilian reais - R$)

Company Consolidated 2001 2000 2001 2000 R$ R$ R$ R$ SOURCES OF FUNDS From operations Net loss (125,389) (84,629) (125,389) (84,629) Expenses (income) not affecting working capital: Depreciation and amortization 144 113 254,922 231,613 Monetary adjustment to concession fee obligation - - 179,998 166,763 Exchange rate variation on long-term debt - - 80,288 26,474 Interest on long-term debt (4,971) 126 15,351 12,546 Deferred income and social contribution taxes - - (52,303) (80,022) Disposal of property and equipment - - 3,129 3,199 Other 103,806 69,870 - - Minority interest - - 693 6,259 Total from operations (26,410) (14,520) 356,689 282,203 Funds from shareholders Capital increase 67,004 - 67,004 - Minority interest capital increase - - 8,501 - Loans from related parties - - 39,281 - Funds from others Long-term debt - 65,066 317,708 425,575 Decrease in other long-term assets 3,722 - 12,047 - Other accounts - long-term - - - 3,129 Total sources of funds 44,316 50,546 801,230 710,907

USES OF FUNDS Permanent assets Increase in investments 41,673 98,108 - - Additions to property and equipment 316 76 511,921 464,886 Increase in deferred charges 2,009 - 2,009 - Increase in other long-term assets 32,608 4,000 - 5,971 Transfer of long-term debt to current liabilities 34,146 - 113,232 80,053 Transfer of long-term concession fee obligation to current liabilities - - 112,300 105,218 Decrease in other long-term liabilities - - 2,234 2,153 Total uses of funds 110,752 102,184 741,696 658,281

DECREASE (INCREASE) IN WORKING CAPITAL DEFICIENCY (66,436) (51,638) 59,534 52,626

Changes in working capital Current assets At the end of the year 19,462 8,740 105,590 100,263 At the beginning of the year 8,740 1,209 100,263 92,419 Increase in current assets 10,722 7,531 5,327 7,844

Current liabilities At the end of the year 137,042 59,884 485,137 539,344 At the beginning of the year 59,884 715 539,344 584,126 Increase (decrease) in current liabilities 77,158 59,169 (54,207) (44,782)

DECREASE (INCREASE) IN WORKING CAPITAL DEFICIENCY (66,436) (51,638) 59.534 52,626

See notes to financial statements.

64 | Annual Report 2001 Notes to the Consolidated Financial Statements For the years ended December 31, 2001 and 2000 (currency amounts expressed in thousands of Brazilian reais - R$)

1. OPERATIONS Companhia de Concessões Rodoviárias (the “Company”) was formed on September 23, 1998 to participate in Brazil's state and federal toll road concessions program. The Company has a controlling interest in the following concessionaires: • Concessionária da Rodovia Presidente Dutra S.A. • Concessionária do Sistema Anhangüera-Bandeirantes S.A. • Concessionária da Rodovia dos Lagos S.A. • Concessionária da Ponte Rio Niterói S.A. • Rodonorte-Concessionária de Rodovias Integradas S.A. The concessionaires hold the following concessions, respectively: • Through February 2021, Highway BR-116/RJ/SP, which links the cities of São Paulo and Rio de Janeiro (Highway Presidente Dutra) and respective access roads, totalling 402.2 km; • Through April 2018, Highway System Anhangüera - Bandeirantes, São Paulo - Limeira, totalling 316.8 km; • Through December 2021, Connection Rio Bonito - Araruama - São Pedro da Aldeia, covering Highways RJ 123, Rio Bonito - Araruama; parallel to RJ 106, Araruama - São Pedro da Aldeia; and 4 km of RJ 106 between km 105 and km 109, totalling 60.0 km; • Through May 2015, Bridge Presidente Costa e Silva (Rio - Niterói), totalling 23.3 km; • Through November 2021, Highway BR 376, Apucarana - São Luís do Purunã; Highway BR 277, São Luís do Purunã - Curitiba; PR 151, Jaguariaíva - Ponta Grossa; and respective junctions, totalling 487.5 km. The concessions allow for the collection of tolls and, to a limited extent, other commercial revenues in connection with the lease of land along the road. The concessionaire is responsible for repairing, maintaining, expanding and operating the road/bridge, including the access road. According to the terms of the concession contract, the concessionaire receives the fixed assets from the concession grantor and is responsible for the integrity of such assets as well as for improvements in the road/bridge. At the end of the concession period, improvements and additions revert to the concession grantor. The concession contract does not include any renewal or extension clauses. The concession agreements provide for the annual adjustment of the basic tariff using specific formulas set forth in the concession agreement. The formulas for the adjustment of the basic tariffs are based on changes in price indices also specified in the concession agreement.

CCR Companhia de Concessões Rodoviárias | 65 Notes to the Consolidated Financial Statements For the years ended December 31, 2001 and 2000 (currency amounts expressed in thousands of Brazilian reais - R$)

The consolidated financial statements include the following companies:

Companies Ownership percentage % Concessionária da Rodovia Presidente Dutra S.A. 100.00 Concessionária do Sistema Anhangüera – Bandeirantes S.A. 100.00 Concessionária da Rodovia dos Lagos S.A. 100.00 Concessionária da Ponte Rio - Niterói S.A. 100.00 Rodonorte - Concessionária de Rodovias Integradas S.A. 74.24 Parques Serviços Ltda. (*) 74.24

(*) From June 30, 2000

Investments, corresponding shareholders’ equity and other intercompany assets and liabilities and related revenues and expenses have been eliminated in the consolidation. The portion of the shareholders’ equity and results of operations attributable to the minority shareholders has been recorded in the caption “Minority Interest”.

66 | Annual Report 2001 Vacation payable accrual The Company fully accrues as a liability future compensation to employees for vacations vested during the year. Income and social contribution taxes The provision for income and social contribution taxes includes amounts for deferred taxes arising as a result of loss carryforwards and temporary differences between financial and tax reporting. Deferred tax assets are reduced by valuation allowances, if it is determined that realization is not more likely than not. Long-term debt Long-term debt includes accrued interest and exchange rate variations to the balance sheet date. Concession fee obligation The concession fee obligation is stated at the original amount plus monetary adjustment accrued through the balance sheet date, less payments made through the balance sheet date. Provisions for contingencies Provisions for contingencies are recorded at the amounts of probable losses based on legal advice and management’s opinion of the outstanding matters at the balance sheet date. Loss per share Loss per share has been calculated based on the number of shares issued and outstanding as of the balance sheet date. Transactions and balances in foreign currency Transactions in foreign currency are converted into Brazilian reais (R$) at the prevailing exchange rates at the time of the related transactions. Foreign currency denominated assets and liabilities are translated using the exchange rate at the balance sheet date. Exchange rate variations are recognized in the statement of loss as they occur. Gross operating revenues Operating revenues are recognized as tolls are collected at roads and bridges. Segment information The Company operates solely in one segment: the operation of highways and bridges. All revenues are generated from the collection of tolls and lease of land along the road throughout Brazil.

4. RESTRICTED DEPOSITS - CONSOLIDATED The restricted deposits are required as security for the loans obtained from Internacional Finance Corporation - IFC, Inter - American Development Bank - IDB and National Bank for Economic and Social Development - BNDES. The amount required to be maintained on deposit is invested in short-term investments and becomes available to the Company for unrestricted use as the loans are repaid or other guarantees are provided (see Note 9).

CCR Companhia de Concessões Rodoviárias | 67 Notes to the Consolidated Financial Statements For the years ended December 31, 2001 and 2000 (currency amounts expressed in thousands of Brazilian reais - R$)

5. INVESTMENTS - COMPANY

Concessionária Concessionária Rodonorte da Rodovia do Sistema Concessionária Concessionária Concessionária Parques Presidente Anhangüera- da Rodovia da Ponte Rio- de Rodovias Serviços Dutra S.A. Bandeirantes S.A. dos Lagos S.A. Niterói S.A. Integradas S.A. Ltda. Total

Paid-up shares owned in 2000: Common 41,256,765 175,000.000 17,583,995 5,754,996 329,854,265 10,000 Preferred 82,513,531 - 17,584,000 5,755,000 659,708,532 - Paid-up shares/quotas owned in 2001: Common 41,256,765 175,000,000 17,583,995 8,665,000 408,220,091 10,000 Preferred 82,513,531 - - 17,584,000 8,665,000 816,443,059 - Total capital share 100% 100% 100% 100% 74.24% 74.24% Capital stock in 2000 R$ 129,975 158,990 35,168 12,327 49,478 10 Capital stock in 2001 R$ 137,385 171,162 35,168 17,327 82,480 10 Stockholders’ equity (deficiency): 2000 R$ 162,583 (123,698) 148 318 (10,818) 23 2001 R$ 167,542 (219,684) (15,391) 5,658 24,739 153 Profit (loss) for the year 2000 R$ 22,461 (103,759) (5,905) (702) 24,281 12 Profit (loss) for the year 2001 R$ 17,558 (108,158) (15,539) 340 2,554 130 R$ R$ R$ R$ R$ R$ R$ Movement: Investment as of December 31, 1999 150,269 - 6,053 1,020 - - 157,342 Allowance for loss as of December 31, 1999 - (118,039) - - (26,057) - (144,096) Additions - 98,100 - - - 8 98,108 Interest on stockholders’ equity (10,147) - - - - - (10,147) Equity results 22,461 (103,759) (5,905) (702) 18,026 9 (69,870) Investment as of December 31, 2000 162,583 - 148 318 - 17 163,066 Provision for loss as of December 31, 2000 (123,698) (8,031) (131,729)

Additions - 12,172 - 5,000 24,501 - 41,673 Interest on stockholders’ equity (12,599) - - - - - (12,599) Equity results 17,558 (108,158) (15,539) 340 1,896 97 (103,806) Investment as of December 31, 2001 167,542 5,658 18,366 114 191,680 Provision for loss as of December 31, 2001 (219,684) (15,391) (235,075)

68 | Annual Report 2001 The transfer of Concessionária da Rodovia dos Lagos’ stocks was treated as a capital contribution, subject to ratification by the concession authority and investment agents, namely BID and BNDES. Through December 31, 2001, such ratification had not yet been obtained from the respective agents. Assets and net revenues of this subsidiary represent 4.8% and 2.8%, respectively, of the consolidated amounts.

6. PROPERTY AND EQUIPMENT - CONSOLIDATED

2001 2002 Annual Accumulated depreciation depreciation and rates Cost amortization Net Net % R$ R$ R$ R$ In operation: Transferred from concession grantors: Initial services 5.0 22,069 4,046 18,023 19,126 Earthwork 5.6 130,233 26,550 103,683 110,924 Paving 14.3 197,770 103,625 94,145 122,407 Special and current works of art 8.3 295,860 90,268 205,592 229,602 Signs and security 25.0 15,328 14,051 1,277 5,109 Additional works 6.3 7,228 1,656 5,572 6,023 Environmental protection and other 10.0 8,673 3,180 5,493 6,360 Collection and weighing equipment 25.0 9,500 8,708 792 3,167 686,661 252,084 434,577 502,718 Right of way ( Intangible Assets) 5.0 1,096,341 201,481 894,860 949,759 1,783,002 453,565 1,329,437 1,452,477 Additions and improvements: Works of art and concrete barriers 5.0 352,146 70,252 281,894 96,210 Building, earthwork and drainage 4 to 5 495,314 49,798 445,516 296,625 Paving and new covering of asphalt 12.5 512,297 122,693 389,604 170,302 Topographic projects and surveys 5.0 68,222 10,413 57,809 24,331 Preliminary services 5.0 35,268 6,388 28,880 11,068 Horizontal, vertical and aerial signs 10 to 67 163,663 67,326 96,337 85,893 Vehicles and operating equipment 40.0 14,007 7,833 6,174 5,420 Other operating equipment 10 to 20 31,674 8,093 23,581 19,010 Systems and subsystems 5 to 20 161,093 38,397 122,696 106,347 Furniture, fixtures and installations 10.0 8,712 3,252 5,460 4,602 Property, land and other 5.0 61,270 10,283 50,987 18,599 1,903,666 394,728 1,508,938 838,407 In progress: Works and constructions 123,862 - 123,862 409,380 Advances 1,113 - 1,113 290 2,028,641 394,728 1,633,913 1,248,077

Total 3,811,643 848,293 2,963,350 2,700,554

CCR Companhia de Concessões Rodoviárias | 69 Notes to the Consolidated Financial Statements For the years ended December 31, 2001 and 2000 (currency amounts expressed in thousands of Brazilian reais - R$)

Concessionária do Sistema Anhangüera-Bandeirantes S.A. recognized the concession right as permanent assets. Based on an independent appraisal report, the Company divided the global amount of R$ 1,721,802 into tangible assets transferred from concession grantor (R$ 686,661) and rights of way - intangible asset (R$ 1,035,141) against a credit to concession fee obligation in liabilities. Concessionária da Rodovia dos Lagos S.A. recognized the full amount of the concession right of way - intangible asset" in permanent assets (R$ 61,200) against a credit to concession fee obligation in liabilities.

7. CONCESSION FEE OBLIGATION - CONSOLIDATED Amounts due as of December 31 consist of: 2001 2000 Long- Long- Current term Current term R$ R$ R$ R$ São Paulo Highways Department - System Anhangüera - Bandeirantes Fixed monthly payment during the concession period, adjusted for the variation of the IGP-M (General Market Price Index) in July of each year, payable through April 2018 110,449 1,749,561 101,414 1,688,405 Variable amount corresponding to 3% of the income for the prior month 1,353 - 838 - Other payments linked to the concession made in equal monthly installments payable through October 2000, adjusted for the variation of the IGP-M in July of each year 2,196 - 2,196 - Total 113,998 1,749,561 104,448 1,688,405 Government of State of Rio de Janeiro - Rodovia dos Lagos Annual installments in February of each year, adjusted for the variation of the index prices calculated by Fundação Getúlio Vargas, payable through February 2022 141 91,033 141 84,491 Total 114,139 1,840,594 104,589 1,772,896

70 | Annual Report 2001 As part of the acquisition of the Anhangüera - Bandeirantes concession, the Company also assumed certain obligations to third parties for services rendered, which have been substantially paid, except for the remaining balance at December 31, 2001. This balance remains open subject to finalization of discussions between the parties regarding monetary adjustment of amounts owed. As of December 31, 2001, the scheduled long-term payments, subject to a monetary adjustment as described above, are as follows: R$ 2003 114,243 2004 114,243 2005 114,243 2006 114,243 2007 114,243 After 2007 1,269,379 Total 1,840,594

8. SHORT-TERM DEBT - CONSOLIDATED The Company enters into short-term financing arrangements with various commercial banks to fund working capital requirements. At December 31, 2000 such short-term financing amounted to R$ 158,351, of which approximately R$ 56,754, were denominated in U.S. dollars. Short-term financing is subject to variable interest rates for real denominated debt and fixed interest rates for U.S. dollar denominated debt. In the case of the real denominated debt, the variable interest rates ranged from 1.0% to 7.5% per annum above CDI. In the case of the U.S. dollar denominated debt, the fixed interest rates ranged from 12.9% to 17.5% per annum.

9. LONG-TERM DEBT - CONSOLIDATED At December 31, long-term debt is composed of: Financing institutions Interest rate Payable through 2001 2000 Current maturity Long-term Current maturity Longo prazo R$ R$ R$ R$ In reais BNDES (2), (3) TJLP plus 5% to 5,5% p.a. February 2012 44,673 442,378 33,540 324,875 Finame TJLP plus 4% a 4,3% p.a. July 2003 606 270 816 845 Banco Volkswagen S.A. TJLP plus 12% p.a. August 2004 14 21 7 35 Debêntures CDI plus 1% p.a. to IGPM plus 11% p.a. May 2010 36,077 126,930 32,073 64,146 Total 81,370 569,599 66,436 389,901

In US Dollars IFC (2), (3) LIBOR plus 3,5% to 4,625% p.a. February 2012 50,377 255,793 45,667 230,724 BID (3) LIBOR plus 4,25% to 4,625% p.a. February 2012 8,205 235,019 7,349 169,411 Credit Lyonnais (1) LIBOR plus 1% p.a. March 2005 8,946 12,521 7,724 18,002 COFACE LIBOR plus 0,75% p.a. May 2004 1,681 2,495 1,434 3,586 BNDES 5% p.a. January de 2011 67 7,700 - - NEC do Brasil LIBOR plus 2,5% p.a. February 2001 - - 1,703 - Amtech Corporation 11% p.a. March 2002 239 - 330 - BCN 9,8% p.a. August 2003 22,836 Total 69,515 536,364 64,207 421,723 Total 150,885 1,105,963 130,643 811,624

CCR Companhia de Concessões Rodoviárias | 71 Notes to the Consolidated Financial Statements For the years ended December 31, 2001 and 2000 (currency amounts expressed in thousands of Brazilian reais - R$)

TJLP (“Taxa de Juros de Longo Prazo”) is the Brazilian long-term interest rate reset quarterly by the Brazilian Central Bank. In the event the TJLP exceeds 6% per annum, the differential is added to the principal balance outstanding. At December 31, 2001, the TJLP rate was 10% per annum. CDI (“Certificados de Depósitos Interbancarios”) is the rate charged between banks on interbanks loans. At December 31, 2001, the CDI rate was 19.02% per annum. LIBOR (“London Interbank Offered Rate”) at December 31, 2001 was 2.37% per annum. As of December 31, 2001, the scheduled payments of long-term debt are as follows: R$ 2003 214,459 2004 185,839 2005 150,355 2006 134,886 2007 112,151 After 2007 308,273 Total 1,105,963

Due to magnitude of their projects, the Company's subsidiaries are structuring a substantial portion of their financing as project finance with reduced guarantees (limited right of recourse) from the Company and its shareholders. Financing guarantees after completion of the projects are collateralized by concessionaires' revenues, common and/or preferred shares, insurance indemnity and potential indemnities from the concession grantor. The limited right of recourse applies only in the case of rescission of the concession agreement by the concession grantor for the concessionaire's failure to meet the obligations set forth in the agreement. In this case, CCR's shareholders are required to pay any potential difference between the indemnity received from the concession grantor and the amount of the financing. (1) Loans are guaranteed by shareholders and Banco BCN S.A.; (2) Loans to Concessionária da Rodovia Presidente Dutra S.A. ("Dutra") from IFC amounting to R$ 177,238 and from BNDES amounting to R$ 130,355 are secured by 49.95% of the total common shares (41,256,773) and 100% of the preferred shares (82,513,531) of Concessionária da Rodovia Presidente Dutra S.A.; (3) The Concessionaire borrowers are subject to a number of security requirements and restrictive covenants under the various financing agreements with IFC, BNDES and Inter- American Development Bank - IDB. The security requirements and more restrictive covenants are as follows: AutoBAn and Dutra • Future revenues as collateral; • Mortgage on all chattels acquired during the concession; • Insurance for all assets; • No loan from third parties, without lender's approval; • No sale of all or substantial part of its assets; • No declaration or payment to shareholders of dividends or any kind of distribution if financial indices set forth in the Common Terms contracts are not met; and • Debt service ratio greater or equal to 1.3.

72 | Annual Report 2001 NovaDutra (net income + depreciation + amortization + non-monetary expenses and income + interest + fees and other debt charges) ÷ debt service for the period AutoBAn (net income + depreciation + amortization + non-monetary expenses and income - payment of concession right + interest (debt and subordinated debt) - investment + working capital variation ÷ debt service

• Long-term debt ratio (long-term debt ÷ net equity) NovaDutra less than or equal to 1.5 AutoBAn less than or equal to 2.0 for “financial completion” and afterwards, less than or equal to 1.5

• Liquidity ratio (current assets ÷ current liabilities) NovaDutra - greater than 0.8 AutoBAn greater than 0.9

• Quarterly deposit equivalent to US$ 2,000,000 (NovaDutra) and US$ 3,520,000 (AutoBAn) in the guarantee account up to a limit of US$ 36,000,000 (NovaDutra) and US$ 35,200,000 (AutoBAn), or other kinds of collateral with the same value.

AutoBAn • No distribution of profits, except those required by law or labor union agreements; • No sale of property, revenue or other asset, except in the circumstances foreseen in the agreement; • No incurrence of expenses in excess of US$ 2,000,000 that are not related to the project; • No lease contracts for purchase of assets whose payments exceed US$ 2,500,000 per annum; and • Make investments only in short-term funds and do not lend, advance, or assume other types of investments. Via Lagos • Insurance for all assets; • Do not declare or pay dividends or make any other kind of distribution to shareholders unless: • Debt service ratio for the preceding twelve months, calculated as follows, has been greater than 3;

Free cash flow ÷ debt service, where:

CCR Companhia de Concessões Rodoviárias | 73 Notes to the Consolidated Financial Statements For the years ended December 31, 2001 and 2000 (currency amounts expressed in thousands of Brazilian reais - R$)

Free cash flow is defined as EBITDA - investment - working capital variation - taxes - payment of concession right - deposit account + financial income; and Debt service is defined as all senior debt, i.e., all debt to BNDES and IDB due in the next 12 months • The indebtedness ratio, calculated as follows, is less than 65%;

Debt ÷ net equity, where: Debt is defined as all payments or reimbursements to be made. Net equity is defined as net equity, irrevocable capital contribution, subordinated debt and other types of capital contribution. • Periodic debt service payments (principal and interest) have been made. • No incurrence of expenses or commitments associated with fixed assets and other noncurrent assets in excess of US$ 500,000; • Do not incur, assume or allow the existence of debt, with the exception of: • financing from IDB; • short-term debt not in excess of US$ 5,000,000; • subordinated debt related to project maintenance or additional investments; and • debt to finance project alterations requested and approved by the concession grantor and accepted by the concessionaire through an amendment to the concession agreement and that will involve tariff increases or other types of compensation. • Financing from IDB cannot be subordinated to any other debt; • No liens on assets or revenues are allowed at present or in the future, unless otherwise stated in the financing agreement; • Do not sell, transfer or dispose of assets greater than US$ 100,000; • Do not pay in advance or call any long-term debt, except for IDB financing, unless the long-term debt will be refinanced on equivalent or more favorable terms.

10. RELATED PARTIES - CONSOLIDATED The subsidiaries contract, directly or by consortium, services from shareholders of the Company or from companies controlled by or affiliated with them. Transactions for the year and balances at December 31 can be summarized as follows:

74 | Annual Report 2001 Consolidated Balances Transactions Other Other Short-term Short-term Long-term Services Property and operating operating assets Loans (1) Accounts payable Loans (2) Accounts payable rendered equipment expenses income R$ R$ R$ R$ R$ R$ R$ R$ R$ Camargo Corrêa S.A. - 17,843 - 11,858 - - - - - Construções e Comércio Camargo Corrêa S.A. - - 1,152 - 720 - - 2,625 - Construtora Andrade Gutierrez S.A. - 20,204 2,656 11,858 777 - 18,553 2,963 - Serveng-Civilsan S.A.- Empresas Associadas de Engenharia - 14,455 169 8,605 476 - 11,765 2,084 - Construtora Castilho de Porto Alegre S.A. - - 115 - - - - 9 - Construtora Norberto Odebrecht S.A. - - 1,182 - - - 1,872 85 - Brisa Participações e Empreendimentos Ltda. - 20,257 - - - - - 296 - COPER-Consórcio Operador da Rodovia Presidente Dutra - - 8,160 - - 97,125 - - - Camargo Corrêa Transportes S.A. - 2,085 - - - - 3,629 337 - Cesbe S.A. - Engenharia e Empreendimentos - - 97 - - - - 7 - Odebrecht Serviços de Infra-estrutura S.A. - 19,899 - 11,858 714 - - 2,878 - SVE Participações S.A. 500 167 - - - - - 17 - J. Malucelli Construtora de Obras Ltda. - - 97 - - - - 428 - Trapézio Engenharia S.A. - 30 - - - - - 4 - Consórcio Construban 73 - 14,634 - - - 324,470 - - Consórcio Construtor Parques 686 - 14,426 - - - 95,443 - - Servix Engenharia S.A. - 3,478 - 2,115 109 - - 495 -

Via Engenharia - 2,420 - 1,482 76 - - 349 - Consórcio Construtor Via Lagos - - - - 1,175 - - - - Consórcio Operador Parques 1,342 - 3,742 ------Total 2001 2,601 100,838 46,430 47,776 4,047 97,125 455,732 12,577 - Total 2000 19 26,453 60,021 2,719 4,066 93,076 419,480 2,904 2,900

Amounts and remuneration of transactions performed by concessionaires with related parties were estabilished primarily based on amounts budgeted at the time the plan for operating highway services highway services was prepared, as part of the respective request for proposal. The amounts and payments related to services rendered were established primarily based on the amounts budgeted upon the preparation of the concession plan, as required in the respective public bid process. The interest rate is IGP-M plus 12% p.a.

CCR Companhia de Concessões Rodoviárias | 75 Notes to the Consolidated Financial Statements For the years ended December 31, 2001 and 2000 (currency amounts expressed in thousands of Brazilian reais - R$)

11. FINANCIAL INSTRUMENTS - CONSOLIDATED Foreign currency exposure The Company uses short-term and long-term debt to fund operating requirements, including working capital needs and project financing for capital improvement projects. A portion of the Company’s debt is denominated in U.S. dollars, which at December 31, 2001 amounted to R$ 605,879 (see Note 9). Of this amount, R$ 583,043 was exposed to unfavorable changes in the real/U.S. dollar exchange rate. The Company has not made hedge operations for financing contracts extending over three years, because it considers the cost very high for the possible benefits. Interest rate exposure The Company is exposed to floating interest rates, principally variations of (1) LIBOR on loans denominated in U.S. dollars, (2) TJLP (long-term interest rate) and CDI (interbank deposit certificate) on loans in Brazilian reais. In general interest on financial investments is linked to the variation of CDI. Concentrations of credit risk Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents, short-term investments, restricted deposits and other receivables. The Company maintains cash and cash equivalents, short-term investments and restricted deposits with large financial institutions. Fair value of financial instruments The carrying amounts and fair values of the Company’s financial instruments as of December 31 are as follows: 2001 2000 Carrying Fair Carrying Fair amount value amount value R$ R$ R$ R$ Cash and banks 35,215 35,215 28,194 28,194 Short-term investments 32,302 32,302 43,347 43,347 Restricted deposits 11,697 11,697 41,181 41,181 Concession fee obligation (including current portion) 1,954,733 - 1,877,485 - Short-term and long-term debt 1,256,848 1,256,848 1,100,618 1,100,618 Loans from related parties 148,614 148,614 29,172 29,172

76 | Annual Report 2001 • Cash and cash equivalents, short-term investments and restricted deposits - The carrying amounts reported in the balance sheet approximate fair value due to the short maturity of these instruments. • Short- and long-term debt and intercompany loans - The market value was determined considering realizability and market rates in effect at the balance sheet date and approximates the carrying amount.

• Concession fee obligation - As described in Note 7, are adjusted for inflation primarily based on the variation of the IGP-M, and since they are not traded in the market, comparison to carrying value is not practicable.

12. SHAREHOLDERS’ DEFICIT The consolidated financial statements reflect the consolidated shareholders’ deficit of the Company and its subsidiaries, after segregating as minority interests the participation of minority shareholders in the subsidiaries. a) Share capital Capital is comprised of 67,854,402 common shares without par value (at December 31, 2000, 7,148,386 shares consisting of 3,574,193 common shares and 3,574,193 preferred shares). On June 28, 2001, the Company increased its capital in the amount of R$ 67,004, with the issuance of 195,496 preferred shares and 195,496 common shares. The capital increase was paid in by existing shareholders. On November 20, 2001, the Company converted all its preferred shares into common shares and split the existing shares, with each share being composed of nine common shares. b) Dividends The Company bylaws provide for an annual distribution of compulsory minimum dividends of 25% of net income, as defined by Brazilian Corporate Law.

13. COMMITMENTS AND CONTINGENCIES - CONSOLIDATED Provision for contingencies The Company and its subsidiaries are contesting the payment of certain taxes and contributions and has made court escrow deposits (judicial deposits for legal proceedings) of equivalent or lesser amounts pending final legal decisions. Probable losses, provided as liabilities of the Company based on the advice of outside legal counsel, are summarized below: 2001 2000 R$ R$ Social Integration Program - PIS 5,697 3,077 Socil Security Funding – COFINS 18,362 9,684 Service tax – ISS 493 1,766 Other 1,255 928 25,807 15,455

CCR Companhia de Concessões Rodoviárias | 77 Notes to the Consolidated Financial Statements For the years ended December 31, 2001 and 2000 (currency amounts expressed in thousands of Brazilian reais - R$)

In addition to the concession fee obligation, the Company’s subsidiaries have commitments to improve and expand the highways. As of December 31, 2001 these commitments are estimated at R$ 2,314,738 and the planned investments scheduled over the next three years are : R$ (Unaudited) 2002 229,798 2003 141,692 2004 114,971 Total 486,461

14. INCOME AND SOCIAL CONTRIBUTION TAXES - CONSOLIDATED Tax rates The Brazilian statutory rates are as follows: 2001 2000 Period Tax rate Period Tax rate Federal income tax Jan - Dec 25% Jan - Dec 25% Social contribution tax Jan - Dec 9% January 12% Feb - Dec 9% Combined income tax rate Jan - Dec 34% Jan - Dec 34,25%

Income tax reconciliation Income tax expense relating to operations in each of the following years is reconciled to the Brazilian statutory tax rates as follows: 2001 2000 R$ R$ Net loss before income taxes, profit sharing and minority interest (173,057) (152,479) Statutory income tax rate 34% 34.25% Income tax benefit at statutory tax rates 58,839 52,224 Adjustments to derive effective tax rate: Profit sharing - 218 Reversal (constitution) of valuation allowance (6,593) 24,591 Effect of different rate used to record deferred tax assets (a) (1,730) (1,906) Other (2,155) (357) Income tax (expense) benefit 48,361 74,770

78 | Annual Report 2001 (a) The measurement of deferred tax on net operating losses was made using an income tax rate of 33% based on provisions of the enacted tax law in effect for the future periods when management expects the Company to realize the income tax benefits. The major components of the deferred tax accounts are as follows: 2001 2000 R$ R$ Income tax assets Brazilian net operating loss carryforwards 261,741 202,845 Valuation allowance (9,024) (2,431) Deferred income tax assets, net of valuation allowances - noncurrent 252,717 200,414

Such deferred tax assets have been recognized by the Company’s subsidiaries’ management based on income projections and an analysis of the nature of operating losses and the status of the respective concessions at the balance sheet date. In October 2001, Company management reviewed the five-year profit projections for each of the five concessionaires, considering their actual results until September 2001. Based on such projections and prospects of investment growth with reduced indebtedness ratio, the management believes that sufficient taxable income will be generated from operations to absorb the deferred tax asset within the next 10 years. This estimate contemplates the utilization of the deferred tax asset up to a limit of 30% of taxable income as determined by prevailing legislation. As part of the analysis, the management reviewed the macroeconomic premises adopted in the projections, revenue growth resulting from increased traffic for each concessionaire, and annual adjustment of toll rates set forth in the concession agreements. The causes for the tax operating losses have been identified, and such losses are considered to be nonrecurring. Tax losses are primarily due to the following: • Exchange loss recorded on loans denominated in foreign currency, resulting from the Real’s devaluation in 1999; • In Rodonorte’s specific case, a 50% reduction in toll rates as established by the state government.

CCR Companhia de Concessões Rodoviárias | 79 Notes to the Consolidated Financial Statements For the years ended December 31, 2001 and 2000 (currency amounts expressed in thousands of Brazilian reais - R$)

In the second half of 2000, Rodonorte - Concessionária de Rodovias Integradas S.A. recognized deferred tax assets of R$ 28,233, substantially related to prior periods’ tax losses. Such deferred tax assets had not been recognized prior to 2000 since there was no expectation of future taxable income due to an unilateral action by the State of Paraná government to reduce toll rates beginning July 1998. However, on March 22, 2000, toll rates were reviewed and the rates established in the concession agreement were reinstated to the extent. Estimates of expected future taxable income were revised and demonstrated the Company’s ability to absorb prior periods’ tax operating losses and was recorded the deferred assets.

15. UNILATERAL REDUCTION OF TOLL RATE - CONSOLIDATED

On July 20, 1998, the government of the state of Paraná unilaterally reduced by 50% the toll rates charged by Rodonorte under its concession agreement, as well as those of other concessionaires operating under the Paraná State Highway Concessions Program. Holding that this unilateral action had adversely affected the economic-financial equilibrium on which the Rodonorte concession was based, on August 13, 1998, Rodonorte, along with the other concessionaires, took legal action against the state of Paraná, the Federal Government and the state of Paraná Highway Department, seeking to restore the economic-financial equilibrium. As part of its legal action, Rodonorte obtained an injunction from the Federal Court on August 28, 1998, which suspended Rodonorte's obligation to make investments under the concession agreement. On December 17, 1999, Rodonorte and the other concessionaires obtained preliminary injunctive relief (“tutela antecipada”) for restoration of the original toll rate, adjusted for inflation. The state of Paraná appealed the decision of December 17, 1999, without success. On March 22, 2000, Rodonorte and the state of Paraná reached a settlement in which the toll rates on light vehicles were restored. Toll rates for all heavy vehicles with more than two axles continued to carry an 18% discount. This 18% discount continues in effect. As compensation for the reduction in heavy vehicle toll rates and the past reduction in toll rates generally, Rodonorte was allowed to reduce its investments in the highway. On March 24, 2000, the federal court of Parana state approved the action; however, on May 18, 2000, the attorney general office of Parana state filed an appeal seeking to (a) annul the action alleging that the attorney general office did not have the opportunity of participating in the action, as required by law; or (b) toll rate reduction of 50% as previously determined. Until this appeal is judged, the terms of the action will cease to have effect. The toll rates are being collected based on the agreement made with the state of Parana on May 3, 2000.

80 | Annual Report 2001 16. CONSOLIDATED STATEMENTS OF CASH FLOWS 2001 2000 R$ R$ Cash flows from operating activities: Net income (loss) (125,389) (84,629) Adjustments to reconcile net income (loss) to net cash provided by operating activities: Deferred income and social contribution taxes (52,303) (80,022) Depreciation and amortization 254,922 231,613 Monetary adjustment to concession fee obligation 179,998 166,173 Exchange rate variation 111,529 41,621 Disposal of property and equipment - 3,199 Minority interest 693 6,259 Changes in operating assets and liabilities: Accounts receivable (1,526) (11,174) Recoverable taxes (7,502) 997 Prepaid expenses and others (323) (1,884) Other long-term assets 12,047 (5,971) Accounts payable - suppliers (7,217) 9,271 Related parties 4,131 1,377 Accrued payroll and related liabilities 831 4,615 Taxes and contributions payable 3,661 (614) Other accounts payable - short-term and long-term 14,068 7,188 Accrued interest on short-term and long-term debt 22,231 25,653 Net cash provided by operating activities 409,851 313,672 Cash flows from investing activities: Capital expenditures (526,532) (441,812) Deferred charges (2,009) - Net cash used in investing activities (528,541) (441,812) Cash flows from financing activities: Short-term debt, net (151,818) (109,856) Long-term debt: Repayment s (127,759) (89,099) New borrowings 317,708 425,575 Loans from related parties 103,781 29,334 Payment of concession fee obligation (102,750) (132,031) Capital contributions from: Majority shareholders 67,004 - Minority shareholders 8,501 - Net cash provided by financing activities 114,667 123,923 Increase (decrease) in cash and short-term investments (4,023) (4,217) Cash and short-term investments - at the beginning of the year 71,541 75,758 Cash and short-term investments - at the end of the year (67,517) (71,541)

Supplemental disclosures of cash flows information: Cash paid during the year for: Interest 140,410 110,840 Income taxes 3,305 1,038

CCR Companhia de Concessões Rodoviárias | 81 Notes to the Consolidated Financial Statements For the years ended December 31, 2001 and 2000 (currency amounts expressed in thousands of Brazilian reais - R$)

17. CHANGES IN ACCOUNTING POLICIES Two resolutions from the Brazilian Securities and Exchange Commission (CVM) in draft form are under public discussion. If approved, these documents will change the accounting standards for the recording of the concession right and deferred tax asset. Management is awaiting the final version of these documents so as to evaluate the possible material impacts on the financial condition of the Company.

18. SUBSEQUENT EVENTS On February 1, 2002, the Company completed its public offering process and became the first listed company on the New Market of Bovespa. The Company issued 16,963,601 common shares, which represents 20% of its capital share, at R$ 18.00 per share, totaling a capital increase of R$ 305,345.

82 | Annual Report 2001

Investor Information

Investor Contacts

Líbano Miranda Barroso Chief Financial Officer and Investor Relations Director [email protected] Phone: (5511) 3048-5930

Arthur Piotto Filho Investor Relations [email protected] Phone: (5511) 3048-5932

Eduardo S. M. Camargo Investor Relations [email protected] Phone: (5511) 3048-5965

Rua Leopoldo Couto de Magalhães Jr. - nº 110 11º floor - 04542 000 - São Paulo - SP phone: 5511 3048 5921 - fax: 5511 3048 5911 e-mail: [email protected] www.ccrnet.com.br

84 | Annual Report 2001 www.autoban.com.br

www.novadutra.com.br

www.rodonorte.com.br

www.ponte.com.br

Note: The statements made in this annual report, regarding perspectives for business, projections of operating and financial results, and those related to CCR’s growth perspectives are merely projections and, as such, are based exclusively on the Board’s expectations regarding the future of the business. These perspectives substantially depend on changes in market conditions, the performance of the Brazilian economy, on the industry, and on international markets and, therefore, are subject to change without prior notice.

CCR Companhia de Concessões Rodoviárias | 85 General coordination CCR - Companhia de Concessões Rodoviárias

Editorial project MZ Corporate Communication

Texts MZ Corporate Communication Breakstone & Ruth International

Translator Douglas Schimidt

Photographs Vitor Bontempo Rantigueri Concessionaires Getty Images

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Press and finish Copibrasa Artes Gráficas e Editora Consolidated Financial Statements For the years ended December 31, 2001, 2000 and 1999 Independent Auditors’ Report

To the Shareholders and Management of Companhia de Concessões Rodoviárias São Paulo - SP, Brazil

1. We have audited the accompanying consolidated balance sheets of Companhia de Concessões Rodoviárias and subsidiaries as of December 31, 2001 and 2000, the consolidated statements of loss, changes in shareholders’ deficit and changes in financial position for the years then ended and the combined statements of loss, changes in shareholders’ deficit and changes in financial position for the year ended December 31, 1999 (all expressed in Brazilian reais). These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.

2. We conducted our audits in accordance with auditing standards generally accepted in Brazil, which do not differ in any material respect from auditing standards generally accepted in the United States of America. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

3. In our opinion, such financial statements referred to above present fairly, in all material respects, the financial position of Companhia de Concessões Rodoviárias and subsidiaries at December 31, 2001 and 2000 and the results of their operations and changes in their financial position for each of the three years in the period ended December 31, 2001, in conformity with generally accepted accounting principles established by Brazilian Corporate Law.

4. Accounting principles established by Brazilian Corporate Law vary in certain significant respects from accounting principles generally accepted in the United States of America. The application of the latter would have affected the determination of net loss for each of the three years in the period ended December 31, 2001, and the determination of shareholders’ equity (deficit) and financial position at December 31, 2001 and 2000 to the extent summarized in Note 15.

5. Our audits were conducted for the purposes of forming an opinion on the basic financial statements taken as a whole. The consolidated statements of cash flows for the years ended December 31, 2001 and 2000 and combined statements of cash flows for the year ended December 31, 1999 are presented for purposes of additional analysis and are not a required part of the basic financial statements under accounting practices emanating from Brazilian Corporate Law. Such information has been subjected to the auditing procedures applied to the audits of the basic financial statements and, in our opinion,is fairly stated in all material respects in relation to the basic financial statements taken as a whole.

February 6, 2002

DELOITTE TOUCHE TOHMATSU José Roberto P. Carneiro Auditores Independentes Contador CRC nº. 2 SP 011609/O-8 CRC nº. 1 SP 109447/O-6 CONSOLIDATED BALANCE SHEETS AS OF DECEMBER 31, 2001 AND 2000 (expressed in thousands of Brazilian reais - R$)

2001 2000 2001 2000 ASSETS R$ R$ LIABILITIES AND SHAREHOLDERS’ DEFICIT R$ R$

CURRENT ASSETS CURRENT LIABILITIES Cash and banks 35,215 28,194 Short-term debt and current maturities of long-term debt 150,885 288,994 Short-term investments 32,302 43,347 Loans from related parties 100,838 26,453 Other accounts receivable 21,260 19,734 Concession fee obligation 114,139 104,589 Recoverable income taxes 11,969 4,467 Accounts payable - related parties 46,430 60,021 Prepaid expenses 4,844 4,521 Accounts payable - suppliers 14,109 21,326 Total current assets 105,590 100,263 Other accounts payable 35,179 18,896 Accrued payroll and related liabilities 12,385 11,554 LONG-TERM ASSETS Taxes and contribuitions payable 11,172 7,511 Restricted deposits 11,697 41,181 Total current liabilities 485,137 539,344 Deferred income and social contribution taxes 252,717 200,414 Other 25,382 7,945 LONG-TERM LIABILITIES Total long-term assets 289,796 249,540 Concession fee obligation 1,840,594 1,772,896 Long-term debt 1,105,963 811,624 PERMANENT ASSETS Loans from related parties 47,776 2,719 Property and equipment, net Accounts payable - related parties 4,047 4,066 Transferred from the concession grantors 1,329,437 1,452,477 Other accounts payable 14,097 16,312 Additions and improvements 1,633,913 1,248,077 Total long-term liabilities 3,012,477 2,607,617 Total property and equipment 2,963,350 2,700,554 Deferred charges, net 14,823 21,740 MINORITY INTEREST 6,411 (2,783) Total permanent assets 2,978,173 2,722,294 SHAREHOLDERS’ DEFICIT Capital stock Preferred stock, no par value; 3,574,193 in 2000, authorized issued and outstanding shares 22,206 Commom stock, no par value; 67,854,402 (3,574,193 em 2000) authorized, issued and outstanding shares 111,416 22,206 111,416 44,412 Accumulated deficit (241,882) (116,493)

Total shareholders’ deficit (130,466) (72,081)

TOTAL 3,373,559 3,072,097 TOTAL 3,373,559 3,072,097

STATEMENTS OF LOSS FOR THE YEARS ENDED DECEMBER 31, 2001, 2000 AND 1999 STATEMENTS OF CHANGE IN SHAREHOLDERS’ DEFICIT (expressed in thousands of Brazilian reais - R$, except net loss per share amount) FOR THE YEARS ENDED DECEMBER, 31 2001, 2000 AND 1999 Consolidated Combined (expressed in thousands of Brazilian reais - R$) 2001 2000 1999 R$ R$ R$ Combined GROSS OPERATING REVENUES 931,664 742,361 612,908 shareholders’ Capital Accumulated equity stock deficit Total TAXES ON GROSS REVENUES (61,369) (43,863) (22,146) R$ R$ R$ R$ BALANCES AS OF NET OPERATING REVENUES 870,295 698,498 590,762 DECEMBER 31, 1998 203,480 - - 203,480

COST OF SERVICES: Capital increase 97,236 - - 97,236 Depreciation and amortization (248,704) (224,795) (204,199) Net loss (256,824) - - (256,824) Third-party services (154,224) (112,792) (103,661) Other (74,264) (80,845) (71,371) BALANCES AS OF DECEMBER 31, 1999 43,892 - - 43,892 GROSS PROFIT 393,103 280,066 211,531 Capitalization of OPERATING INCOME (EXPENSES) investments (see note 1) (43,892) 43,892 - - Administrative expenses (100,850) (93,126) (66,317) Capital increase - 520 - 520 Financial expenses: Net loss - - (31,864) (31,864) Monetary adjustment to concession fee obligation (179,998) (166,173) (303,312) BALANCE AS OF Exchange rate variation (111,597) (41,621) (139,450) DECEMBER 31, 1999 - 44,412 (31,864) 12,548 Interest and other financial expenses (191,238) (152,087) (147,528) Financial Income 18,658 15,594 23,501 Net loss - - (84,629) (84,629)

OPERATING LOSS (171,922) (157,347) (421,575) BALANCE AS OF DECEMBER 31, 2000 - 44,412 (116,493) (72,081) NONOPERATING INCOME (EXPENSE) (1,135) 4,868 1,444 Capital increase - 67,004 - 67,004 LOSS BEFORE INCOME AND SOCIAL Net loss - - (125,389) (125,389) CONTRIBUTION TAXES, PROFIT SHARING AND MINORITY INTEREST (173,057) (152,479) (420,131) BALANCE AS OF DECEMBER 31, 2001 - 111,416 (241,882) (130,466) INCOME AND SOCIAL CONTRIBUTION TAXES - CURRENT (3,942) (5,252) 71 INCOME AND SOCIAL CONTRIBUTION TAXES - DEFERRED 52,303 80,022 111,691

LOSS BEFORE PROFIT SHARING AND MINORITY INTEREST (124,696) (77,709) (308,369)

PROFIT SHARING - (661) (703)

LOSS BEFORE MINORITY INTEREST (124,696) (78,370) (309,072)

MINORITY INTEREST (693) (6,259) 20,384

NET LOSS (125,389) (84,629) (288,688)

NET LOSS PER SHARE - R$ (1.85) (11.84)

See notes to financial statements Appendix II | Annual Report 2001 STATEMENT OF CHANGES IN FINANCIAL POSITION STATEMENTS OF CASH FLOW FOR THE YEARS ENDED FOR THE YEARS ENDED DECEMBER 31, 2001, 2000 AND 1999 DECEMBER 31, 2001, 2000 AND 1999 (expressed in thousands of Brazilian reais - R$) (expressed in thousands of Brazilian reais - R$) Consolidated Combined Consolidated Combined 2001 2000 1999 2001 2000 1999 R$ R$ R$ R$ R$ R$ Cash flows from operating activities: SOURCES OF FUNDS Net income (loss) (125,389) (84,629) (288,688) From operations Adjustments to reconcile net income Net loss (125,389) (84,629) (288,688) (loss) to net cash: Expenses (income) not affecting Deferred income and social contribuition taxes (52,303) (80,022) (111,691) working capital: Depreciation and amortization 254,922 231,613 209,897 Depreciation and amortization 254,922 231,613 209,897 Monetary adjustment to concession Monetary adjustment to concession fee obligation 179,998 166,173 303,312 fee obligation 179,998 166,763 316,299 Exchange rate variation 111,529 41,621 139,450 Exchange rate variation on Disposal of property and equipment 3,129 3,199 - long-term debt 80,288 26,474 68,508 Minority interest 693 6,259 (20,384) Interest on long-term debt 15,351 12,546 8,671 Changes in operating assets and liabilities: Deferred income and Accounts receivable (1,526) (11,174) (4,298) social contribution taxes (52,303) (80,022) (111,691) Recoverable taxes (7,502) 997 (1,787) Disposal of property and equipment 3,129 3,199 - Prepaid expenses and others (323) (1,884) 2,905 Other - - 317 Other long-term assets 12,047 (5,971) (21,639) Minority interest 693 6,259 (20,384) Accounts payable - suppliers (7,217) 9,271 (5,876) Total from operations 356,689 282,203 182,929 Related parties 4,131 1,377 179 Funds from shareholders Accrued payroll and related liabilities 831 4,615 1,085 Capital increase 67,004 - 97,756 Taxes and contributions payable 3,661 (614) 3,519 Minority interest capital increase 8,501 - 10,046 Other accounts payable - short-term Loans from related parties 39,281 - - and long-term 14,068 7,188 3,553 Funds from others Accrued interest on short-term Long-term debt 317,708 425,575 145,307 and long-term debt 22,231 25,653 53,178 Decrease in other long-term assets 12,047 - 3,049 Net cash provided by operating activities 412,980 313,672 262,715 Other accounts - long-term 3,129 3,359 Total sources of funds 801,230 710,907 442,446 Cash flows from investing activities: Capital expenditures (529,662) (441,812) (296,861) USES OF FUNDS Deferred charges (2,009) - - Permanent assets: Net cash used in investing activities (531,671) (441,812) (296,861) Additions to property and equipment 511,921 464,886 292,659 Increase in deferred charges 2,009 Cash flows from financing activities: Increase in other long-term assets - 5,971 24,688 Short-term debt, net (151,818) (109,856) (62,536) Transfer of long-term to Long-term debt: current liabilities 113,232 80,053 78,639 Repayments (127,759) (89,099) (50) Transfer of long-term concession New borrowings 317,708 425,575 145,307 fee obligation to current liabilities 112,300 105,218 132,949 Loans from related parties 103,781 29,334 2,638 Decrease in other long-term liabilities 2,234 2,153 11,749 Payment of concession fee obligation (102,750) (132,031) (129,432) Total uses of funds 741,696 658,281 540,684 Capital contributions from: Majority shareholders 67,004 - 97,756 DECREASE (INCREASE) IN WORKING Minority shareholders 8,501 - 10,046 CAPITAL DEFICIENCY 59,534 52,626 (98,238) Net cash provided by financing activities 114,667 123,923 63,729

Changes in working capital Increase (decrease) in cash and Current assets short-term investments (4,024) (4,217) 29,583 At the end of the year 105,590 100,263 92,419 At the beginning of the year 100,263 92,419 59,656 Cash and short-term investments Increase in current assets 5,327 7,844 32,763 at the beginning of the year 71,541 75,758 46,175

Current liabilities Cash and short-term investments - At the end of the year 485,137 539,344 584,126 at the end of the year 67,517 71,541 75,758 At the beginning of the year 539,344 584,126 453,125 Increase (decrease) in current liabilities (54,207) (44,782) 131,001 Supplemental disclosures of cash flows information: DECREASE (INCREASE) IN WORKING Cash paid during the year for: CAPITAL DEFICIENCY 59,534 52,626 (98,238) Interest 140,410 110,840 93,336 Income taxes 3,305 1,038 -

See notes to financial statements

NOTES TO THE CONSOLIDATED AND COMBINED FINANCIAL STATEMENTS FOR THE YEARS ENDED DECEMBER 31, 2001, 2000 AND 1999 (Currency amounts expressed in thousands of Brazilian reais - R$, except per share amount in Note 16 and unitary value per share in Note 18)

1. OPERATIONS Companhia de Concessões Rodoviárias (the “Company”) was formed on September 23, 1998 to participate in Brazil's state and federal toll road concessions program. The Company's shareholders, Construtora Andrade Gutierrez S.A., Camargo Corrêa Transportes S.A., Odebrecht Serviços de Infra-Estrutura S.A., Serveng-Civilsan S.A. - Empresas Associaas de Engenharia and SVE Participações S.A., were direct shareholders of the various toll road concessions acquired by the Company in a share exchange in December 1999. At that time, the shareholders' interest in the concessionaries were acquired in exchange for the Company's shares. The share exchange enabled the Company to acquire a controlling interest in the following concessionaires: • Concessionária da Rodovia Presidente Dutra S.A. • Concessionária do Sistema Anhangüera-Bandeirantes S.A. • Concessionária da Rodovia dos Lagos S.A. • Concessionária da Ponte Rio Niterói S.A. • Rodonorte-Concessionária de Rodovias Integradas S.A. The concessionaires hold the following concessions, respectively: • Through February 2021, Highway BR-116/RJ/SP, which links the cities of São Paulo and Rio de Janeiro (Highway Presidente Dutra) and respective access roads, totalling 402.2 km; • Through April 2018, Highway System Anhangüera - Bandeirantes, São Paulo - Limeira, totalling 316.8 km; • Through December 2021, Connection Rio Bonito - Araruama - São Pedro da Aldeia, covering Highways RJ 123, Rio Bonito - Araruama; parallel to RJ 106, Araruama - São Pedro da Aldeia; and 4 km of RJ 106 between km 105 and km 109, totalling 60.0 km; • Through May 2015, Bridge Presidente Costa e Silva (Rio - Niterói), totalling 23.3 km; • Through November 2021, Highway BR 376, Apucarana - São Luís do Purunã; Highway BR 277, São Luís do Purunã - Curitiba; PR 151, Jaguariaíva - Ponta Grossa; and respective junctions, totalling 487.5 km.

CCR Companhia de Concessões Rodoviárias | Appendix III The concessions allow for the collection of tolls and, to a limited extent, other commercial revenues in connection with the lease of land along the road. The concessionaire is responsible for repairing, maintaining, expanding and operating the road/bridge, including the access road. According to the terms of the concession contract, the concessionaire receives the fixed assets from the concession grantor and is responsible for the integrity of such assets as well as for improvements in the road/bridge. At the end of the concession period, improvements and additions revert to the concession grantor. The concession contract does not include any renewal or extension clauses. The concession agreements provide for the annual adjustment of the basic tariff using specific formulas set forth in the concession agreement. The formulas for the adjustment of the basic tariffs are based on changes in price indices also specified in the concession agreement.

2. PRESENTATION OF THE FINANCIAL STATEMENTS The accompanying financial statements have been prepared in accordance with accounting principles established by Brazilian Corporate Law and supplementary provisions issued by the Brazilian Securities Commission-CVM. For the financial purposes the financial statements include: • Consolidated financial position at December 31, 2001 and 2000 and results of operations, changes in shareholders' deficit and changes in financial position for the years ended December 31, 2001 and 2000; and • Combined results of operations, changes in shareholders' deficit and changes in financial position for the year ended December 31, 1999. The consolidated financial statements include the following companies:

Companies Ownership percentage % Concessionária da Rodovia Presidente Dutra S.A. 100.00 Concessionária do Sistema Anhangüera - Bandeirantes S.A. 100.00 Concessionária da Rodovia dos Lagos S.A. 100.00 Concessionária da Ponte Rio - Niterói S.A. 100.00 Rodonorte - Concessionária de Rodovias Integradas S.A. 74.24 Parques Serviços Ltda. (*) 74.24 (*) From June 30, 2000

3. SUMMARY OF SIGNIFICANT ACCOUNTING PRINCIPLES Use of estimates The preparation of financial statements in accordance with generally accepted accounting principles requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. In the preparation of these financial statements, various estimates and assumptions have been made by management including the selection of useful lives of property and equipment, the adequacy of the allowance for doubtful accounts, employee profit sharing, contingent liabilities, income tax valuation allowances, other accrued expenses and fair value of financial instruments. Actual amounts may vary from those estimates. Short-term investments and restricted deposits Short-term investments and restricted deposits consist of highly liquid investments which are stated at cost plus interest accrued through the balance sheet date. Property and equipment Property and equipment are stated at the cost of acquisition or construction, less accumulated depreciation and amortization. Major renewals and improvements are capitalized while maintenance and repair costs are charged to expenses as incurred. Materials allocated to specific projects are added to construction-in-progress. Depreciation and amortization are computed on the straight- line method based on the lesser of the estimated useful lives of the underlying assets or the concession period. The principal depreciation rates are shown in Note 5. Vacation payable accrual The Company fully accrues as a liability future compensation to employees for vacations vested during the year. Income and social contribution taxes The provision for income and social contribution taxes includes amounts for deferred taxes arising as a result of loss carryforwards and temporary differences between financial and tax reporting. Deferred tax assets are reduced by valuation allowances, if it is determined that realization is not more likely than not. Long-term debt Long-term debt includes accrued interest and exchange rate variations to the balance sheet date. Concession fee obligation The concession fee obligation is stated at the original amount plus monetary adjustment accrued through the balance sheet date, less payments made through the balance sheet date. Provisions for contingencies Provisions for contingencies are recorded at the amounts of probable losses based on legal advice and management’s opinion of the outstanding matters at the balance sheet date. Loss per share Loss per share has been calculated based on the number of shares issued and outstanding as of the balance sheet date. No amount has been calculated for 1999 since the Company's current corporate structure was not in place during that year. Transactions and balances in foreign currency Transactions in foreign currency are converted into Brazilian reais (R$) at the prevailing exchange rates at the time of the related transactions. Foreign currency denominated assets and liabilities are translated using the exchange rate at the balance sheet date. Exchange rate variations are recognized in the statement of loss as they occur. Gross operating revenues Operating revenues are recognized as tolls are collected at roads and bridges. Segment information The Company operates solely in one segment: the operation of highways and bridges. All revenues are generated from the collection of tolls and lease of land along the road throughout Brazil.

4. RESTRICTED DEPOSITS The restricted deposits are required as security for the loans obtained from Internacional Finance Corporation - IFC, Inter - American Development Bank - IDB and National Bank for Economic and Social Development - BNDES. The amount required to be maintained on deposit is invested in short-term investments and becomes available to the Company for unrestricted use as the loans are repaid or other guarantees are provided (see Note 8).

Appendix IV | Annual Report 2001 5. PROPERTY AND EQUIPMENT

2001 2000 Annual Accumulated depreciation depreciation and rates Cost amortization Net Net R$ R$ R$ R$ R$ In operation: Transferred from concession grantors Initial services 5.0 22,069 4,046 18,023 19,126 Earthwork 5.6 130,233 26,550 103,683 110,924 Paving 14.3 197,770 103,625 94,145 122,407 Special and current works of art 8.3 295,860 90,268 205,592 229,602 Signs and security 25.0 15,328 14,051 1,277 5,109 Additional works 6.3 7,228 1,656 5,572 6,023 Environmental protection and other 10.0 8,673 3,180 5,493 6,360 Collection and weighing equipment 25.0 9,500 8,708 792 3,167 686,661 252,084 434,577 502,718 Right of way (Intangible Assets) 5.0 1,096,341 201,481 894,860 949,759 1,783,002 453,565 1.329,437 1,452,477 Additions and improvements Works of art and concrete barriers 5.0 352,146 70,252 281,894 96,210 Building, earthwork and drainage 4 to 5 495,314 49,798 445,516 296,625 Paving and new covering of asphalt 12.5 512,297 122,693 389,604 170,302 Topographic projects and surveys 5.0 68,222 10,413 57,809 24,331 Preliminary services 5.0 35,268 6,388 28,880 11,068 Horizontal, vertical and aerial signs 10 to 67 163,663 67,326 96,337 85,893 Vehicles and operating equipment 40.0 14,007 7,833 6,174 5,420 Other operating equipment 10 to 20 31,674 8,093 23,581 19,010 Systems and subsystems 5 to 20 161,093 38,397 122,696 106,347 Furniture, fixtures and installations 10.0 8,712 3,252 5,460 4,602 Property, land and other 5.0 61,270 10,283 50,987 18,599 1,903,666 394,728 1,508,938 838,407 In progress: Works and constructions 123,862 - 123,862 409,380 Advances 1,113 - 1,113 290 2,028,641 394,728 1,633,913 1,248,077 Total 3,811,643 848,293 2,963,350 2,700,554

6. CONCESSION FEE OBLIGATION Amounts due as of December 31 consist of: 2001 2000 Current Long -term Current Long-term R$ R$ R$ R$ São Paulo Highways Department - System Anhangüera - Bandeirantes Fixed monthly payment during the concession period, adjusted for the variation of the IGP-M (General Market Price Index) in July of each year, payable through April 2018 110,449 1,749,561 101,414 1,688,405 Variable amount corresponding to 3% of the income for the prior month 1,353 - 838 - Other payments linked to the concession made in equal monthly installments payable through October 2000, adjusted for the variation of the IGP-M in July of each year 2,196 - 2,196 - Total 113,998 1,749,561 104,448 1,688,405 Government of State of Rio de Janeiro - Rodovia dos Lagos Annual installments in February of each year, adjusted for the variation of the index prices calculated by Fundação Getúlio Vargas, payable through February 2022 141 91,033 141 84,491 Total 114,139 1,840,594 104,589 1,772,896

Under the terms of the concession agreement related to the Anhangüera - Bandeirantes system, the Company must pay a monthly amount corresponding to 3% gross operating revenues the previous month. Amounts charged to operations in 2001 and 2000 were R$ 11,596 and R$ 8,411, respectively. As part of the acquisition of the Anhangüera - Bandeirantes concession, the Company also assumed certain obligations to third parties for services rendered, which have been substantially paid, except for the remaining balance at December 31, 2001. This balance remains open subject to finalization of discussions between the parties regarding monetary adjustment of amounts owed.

CCR Companhia de Concessões Rodoviárias | Appendix V As of December 31, 2001, the scheduled long-term payments, subject to a monetary adjustment as described above, are as follows: R$ 2003 114,243 2004 114,243 2005 114,243 2006 114,243 2007 114,243 After 2007 1,269,379 Total 1,840,594

7. SHORT-TERM DEBT The Company enters into short-term financing arrangements with various commercial banks to fund working capital requirements. At December 31, 2000 such short-term financing amounted to R$ 158,351, of which approximately R$ 56,754, were denominated in U.S. dollars. Short-term financing is subject to variable interest rates for real denominated debt and fixed interest rates for U.S. dollar denominated debt. In the case of the real denominated debt, the variable interest rates ranged from 1.0% to 7.5% per annum above CDI. In the case of the U.S. dollar denominated debt, the fixed interest rates ranged from 12.9% to 17.5% per annum.

8. LONG-TERM DEBT At December 31, long-term debt is composed of: Financing institutions Interest rate Payable through 2001 2000 Current Long- Current Long- maturity term maturity term R$ R$ In reais BNDES (2), (3) TJLP plus 5% to 5.5% p.a. February 2012 44,673 442,378 33,540 324,875 Finame TJLP plus 4% to 4.3% p.a. July 2003 606 270 816 845 Banco Volkswagen S.A. TJLP plus 12% p.a. August 2004 14 21 7 35 Debentures CDI plus 1% p.a. and IGPM plus 11% p.a. May 2010 36,077 126,930 32,073 64,146 Total 81,370 569,599 66,436 389,901

In U.S. dollars IFC (2), (3) LIBOR plus 3.5% to 4.625% p.a. February 2012 50,377 255,793 45,667 230,724 IDB (3) LIBOR plus 4.25% to 4.625% p.a. February 2012 8,205 235,019 7,349 169,411 Credit Lyonnais (1) LIBOR plus 1% p.a. March 2005 8,946 12,521 7,724 18,002 COFACE LIBOR plus 0.75% p.a. May 2004 1,681 2,495 1,434 3,586 BNDES 5% p.a. January 2011 67 7,700 - - NEC do Brasil LIBOR plus 2.5% p.a. February 2001 - - 1,703 - Amtech Corporation 11% p.a. March 2002 239 - 330 - BCN Swap 9.8% p.a. August 2003 - 22,836 - - Total 69,515 536,364 64,207 421,723 Total 150,885 1,105,963 130,643 811,624

Due to magnitude of their projects, the Company's subsidiaries are structuring a substantial portion of their financing as project finance with reduced guarantees (limited right of recourse) from the Company and its shareholders. Financing guarantees after completion of the projects, are collateralized by concessionaires' revenues, common and/or preferred shares, insurance indemnity and potential indemnities from the concession grantor. The limited right of recourse applies only in the case of rescission of the concession agreement by the concession grantor for the concessionaire's failure to meet the obligations set forth in the agreement. In this case, CCR's shareholders are required to pay any potential difference between the indemnity received from the concession grantor and the amount of the financing. (1) Loans are guaranteed by shareholders and Banco BCN S.A.; (2) Loans to Concessionária da Rodovia Presidente Dutra S.A. ("Dutra") from IFC amounting to R$ 177,238 and from BNDES amounting to R$ 130,355 are secured by 49.95% of the total common shares (41,256,773) and 100% of the preferred shares (82,513,531) of Concessionária da Rodovia Presidente Dutra S.A.; (3) The Concessionaire borrowers are subject to a number of security requirements and restrictive covenants under the various financing agreements with IFC, BNDES and Inter-American Development Bank - IDB. The security requirements and more restrictive covenants are as follows: AutoBAn and Dutra • Future revenues as collateral; • Mortgage on all chattels acquired during the concession; • Insurance for all assets; • No loan from third parties, without lender's approval; • No sale of all or substantial part of its assets; • No declaration or payment to shareholders of dividends or any kind of distribution if financial indices set forth in the Common Terms contracts are not met; and

• Debt service ratio greater or equal to 1.3. NovaDutra (net income + depreciation + amortization + non-monetary expenses and income + interest + fees and other debt charges) ÷ debt service for the period AutoBAn (net income + depreciation + amortization + non-monetary expenses and income - payment of concession right + interest (debt and subordinated debt) - investment + working capital variation ÷ debt service

Appendix VI | Annual Report 2001 • Long-term debt ratio (long-term debt ÷ net equity) NovaDutra less than or equal to 1.5 AutoBAn less than or equal to 2.0 for “financial completion” and afterwards, less than or equal to 1.5

• Liquidity ratio (current assets ÷ current liabilities) NovaDutra - greater than 0.8 AutoBAn greater than 0.9 • Quarterly deposit equivalent to US$ 2,000,000 (NovaDutra) and US$ 3,520,000 (AutoBAn) in the guarantee account up to a limit of US$ 36,000,000 (NovaDutra) and US$ 35,200,000 (AutoBAn), or other kinds of collateral with the same value.

Via Lagos • Insurance for all assets; • Do not declare or pay dividends or make any other kind of distribution to shareholders unless: • Debt service ratio for the preceding twelve months, calculated as follows, has been greater than 3; Free cash flow ÷ debt service, where: Free cash flow is defined as EBITDA - investment - working capital variation - taxes - payment of concession right - deposit account + financial income; and Debt service as defined as all senior debt, i.e., all debt to BNDES and IDB due in the next 12 months • The indebtedness ratio, calculated as follows, is less than 65%; Debt ÷ net equity, where: Debt is defined as all payments or reimbursements to be made; and Net equity is defined as net equity, irrevocable capital contribution, subordinated debt and other types of capital contribution. • Periodic debt service payments (principal and interest) have been made. • No incurrence of expenses or commitments associated with fixed assets and other non-current assets in excess of US$ 500,000; • Do not incur, assume or allow the existence of debt, with the exception of: • financing from IDB; • short-term debt not in excess of US$ 5,000,000; • subordinated debt related to project maintenance or additional investments; and • debt to finance project alterations requested and approved by the concession grantor and accepted by the concessionaire through an amendment to the concession agreement and that will involve tariff increases or other types of compensation. • Financing from IDB cannot be subordinated to any other debt; • No liens on assets or revenues are allowed at present or in the future, unless otherwise stated in the financing agreement; • Do not sell, transfer or dispose of assets greater than US$ 100,000; • Do not pay in advance or call any long-term debt, except for IDB financing, unless the long-term debt will be refinanced on equivalent or more favorable terms.

9. RELATED PARTIES The subsidiaries contract, directly or by consortium, services from shareholders of the Company or from companies controlled by or affiliated with them. Transactions for the year and balances at December 31 can be summarized as follows : Consolidated Balances Transactions

Short-term Long-term Other Other Short-term Fornecedores Accounts Services Property and operating operating assets Loans (1) payable Loans (2) payable rendered equipment expenses income R$ R$ R$ R$ R$ R$ R$ R$ R$ Camargo Corrêa S.A. 17,843 11,858 Construções e Comércio Camargo Corrêa S.A. 1,152 720 2,625 Construtora Andrade Gutierrez S.A. 20,204 2,656 11,858 777 18,553 2,963 Serveng-Civilsan S.A.- Empresas Associadas de Engenharia 14,455 169 8,605 476 11,765 2,084 Construtora Castilho de Porto Alegre S.A. 115 9 Construtora Norberto Odebrecht S.A. 1,182 1.872 85 Brisa Participações e Empreendimentos Ltda. 20,257 296 COPER-Consórcio Operador da Rodovia Presidente Dutra 8,160 97,125 Camargo Corrêa Transportes S.A. 2,085 3,629 337 Cesbe S.A. - Engenharia e Empreendimentos 97 7 Odebrecht Serviços de Infra-estrutura S.A. 19,899 11,858 714 2,878 SVE Participações S.A. 500 167 17 J. Malucelli Construtora de Obras Ltda. 97 428 Trapézio Engenharia S.A. 30 4 Consórcio Construban 73 14,634 324,470 Consórcio Construtor Parques 686 14,426 95,443 Servix Engenharia S.A. 3,478 2,115 109 495 Via Engenharia 2,420 1,482 76 349 Consórcio Construtor Via Lagos 1,175 Consórcio Operador Parques 1,342 3,742

Total 2001 2,601 100,838 46,430 47,776 4,047 97,125 455,732 12,577 - Total 2000 19 26,453 60,021 2,719 4,066 93,076 419,480 2,904 2,900 Total 1999 80,039 196,968 6,767

CCR Companhia de Concessões Rodoviárias | Appendix VII Amounts and remuneration of transactions performed by concessionaires with related parties were established primarily based on amounts budgeted at the time the plan for operating highway services was prepared, as part of the respective request for proposal. The amounts and payments related to services rendered were established primarily based on the amounts budgeted upon the preparation of the concession plan, as required in the respective public bid process. (1) The interest rate is CDI plus 1% p.a. (2) The interest rate is IGP-M plus 12% p.a.

10. FINANCIAL INSTRUMENTS Foreign currency exposure The Company uses short-term and long-term debt to fund operating requirements, including working capital needs and project financing for capital improvement projects. A portion of the Company’s debt is denominated in U.S. dollars, which at December 31, 2001 amounted to R$ 605,879 (see Note 8). Of this amount, R$ 583,043 was exposed to unfavorable changes in the real/U.S. dollar exchange rate. The Company has not made hedge operations for financing contracts extending over three years, because it considers the cost very high for the possible benefits. Interest rate exposure The Company is exposed to floating interest rates, principally variations of (1) LIBOR on loans denominated in U.S. dollars, (2) TJLP (long-term interest rate) and CDI (interbank deposit certificate) on loans in Brazilian reais. In general interest on financial investments is linked to the variation of CDI. Concentrations of credit risk Financial instruments that potentially subject the Company to concentrations of credit risk consist primarily of cash and cash equivalents, short-term investments, restricted deposits and other receivables. The Company maintains cash and cash equivalents, short-term investments and restricted deposits with large financial institutions. Fair value of financial instruments The carrying amounts and fair values of the Company’s financial instruments as of December 31 are as follows: 2001 2000 Carrying Fair Carrying Fair amount value amount value R$ R$ R$ R$ Cash and banks 35,215 35,215 28,194 28,194 Short-term investments 32,302 32,302 43,347 43,347 Restricted deposits 11,697 11,697 41,181 41,181 Concession fee obligation (including current portion) 1,954,733 - 1,877,485 - Short-term and long-term debt 1,256,848 1,256,848 1,100,618 1,100,618 Loans from related parties 148,614 148,614 29,172 29,172

The values provided are representative of fair values as of December 31, 2001 and 2000 and do not reflect subsequent changes in the economy, interest and tax rates, and other variables that may impact determination of fair value. The following methods and assumptions were used in estimating fair values for financial instruments: • Cash and cash equivalents, short-term investments and restricted deposits - The carrying amounts reported in the balance sheet approximate fair value due to the short maturity of these instruments. • Short- and long-term debt - The market value was determined considering realizability and market rates in effect at the balance sheet date and approximates the carrying amount. • Concession fee obligation - As described in Note 6, are adjusted for inflation primarily based on the variation of the IGP-M, and since they are not traded in the market, comparison to carrying value is not practicable.

11. SHAREHOLDERS’ DEFICIT The consolidated financial statements reflect the consolidated shareholders’ deficit of the Company and its subsidiaries, after segregating as minority interests the participation of minority shareholders in the subsidiaries. a) Share capital Capital is comprised of 67,854,402 common shares without par value (at December 31, 2000, 7,148,386 shares consisting of 3,574,193 common shares and 3,574,193 preferred shares). On June 28, 2001, the Company increased its capital in the amount of R$ 67,004, with the issuance of 195,496 preferred shares and 195,496 common shares. The capital increase was paid in by existing shareholders. On November 20, 2001, the Company converted all its preferred shares into common shares and split the existing shares, with each share being composed of nine common shares. b) Dividends The Company bylaws provide for an annual distribution of compulsory minimum dividends of 25% of net income, as defined by Brazilian Corporate Law.

12. COMMITMENTS AND CONTINGENCIES Provision for contingencies The Company and its subsidiaries are contesting the payment of certain taxes and contributions and has made court escrow deposits (judicial deposits for legal proceedings) of equivalent or lesser amounts pending final legal decisions. Probable losses, provided as liabilities of the Company based on the advice of outside legal counsel, are summarized below: 2001 2000 R$ R$ Social Integration Program - PIS 5,697 3,077 Socil Security Funding - COFINS 18,362 9,684 Service tax - ISS 493 1,766 Other 1,255 928 25,807 15,455

Management believes, based on advice from its attorneys, that the provision for contingencies is sufficient to meet probable and reasonably estimable losses in the event of unfavorable rulings, and that the ultimate resolution will not have a significant effect on the Company’s cash flows, consolidated financial position or results of operations. Commitments linked to concessions In addition to the concession fee obligation, the Company’s subsidiaries have commitments to improve and expand the highways. As of December 31, 2001 these commitments are estimated at R$ 2,314,738 and the planned investments scheduled over the next three years are :

Appendix VIII | Annual Report 2001 R$ (Unaudited) 2002 229,798 2003 141,692 2004 114,971 Total 486,461

13. INCOME AND SOCIAL CONTRIBUTION TAXES Tax rates The Brazilian statutory rates are as follows: 2001 2000 1999 Period Tax rate Period Tax rate Period Tax rate Federal income tax Jan - Dec 25% Jan - Dec 25% Jan - Dec 25% Social contribution tax Jan - Dec 9% January 12% Jan - Apr 8% Feb - Dec 9% May - Dec 12% Combined income tax rate Jan - Dec 34% Jan - Dec 34,25% Jan - Dec 35,7% The interest attributed to shareholders' equity, which is deducted directly from retained earnings without being charged to income, is deductible for income tax and social contribution purposes in 2001 and 2000. Income tax reconciliation Income tax expense relating to operations in each of the following years is reconciled to the Brazilian statutory tax rates as follows: 2001 2000 1999 R$ R$ R$ Net loss before income taxes, profit sharing and minority interest (173,057) (152,479) (420,131)

Statutory income tax rate 34% 34.25% 35,7% Income tax benefit at statutory tax rates 58,839 52,224 149,986 Adjustments to derive effective tax rate: Profit sharing - 218 232 Reversal (constitution) of valuation allowance (6,593) 24,591 (26,532) Effect of different rate used to record deferred tax assets (a) (1,730) (1,906) (11,343) Other (2,155) (357) (581) Income tax (expense) benefit 48,361 74,770 111,762

(a) The measurement of deferred tax on net operating losses was made using an income tax rate of 33% based on provisions of the enacted tax law in effect for the future periods when management expects the Company to realize the income tax benefits. The major components of the deferred tax accounts are as follows: 2001 2000 Income tax assets R$ R$ Brazilian net operating loss carryforwards 261,741 202,845 Valuation allowance (9,024) (2,431) Deferred income tax assets, net of valuation allowances - noncurrent 252,717 200,414

Consolidated deferred tax assets relate to tax loss carryforwards and negative social contribution basis, which have no expiration date and are available to offset up to 30% of the Company’s future taxable income in any given year. Consolidated deferred tax assets consist of: 2001 2000 R$ R$ Concessionária do Sistema Anhangüera-Bandeirantes S.A. 190,683 140,024 Concessionária da Rodovia Presidente Dutra S.A. 7,351 7,966 Concessionária da Rodovia dos Lagos S.A. 20,964 18,623 Concessionária da Ponte Rio - Niterói S.A. 4,764 4,846 Rodonorte Concessionária de Rodovias Integradas S.A. 28,955 28,955 Total 252,717 200,414 Such deferred tax assets have been recognized by the Company’s subsidiaries’ management based on income projections and an analysis of the nature of operating losses and the status of the respective concessions at the balance sheet date. In October 2001, Company management reviewed the five-year profit projections for each of the five concessionaires, considering their actual results until September 2001. Based on such projections and prospects of investment growth with reduced indebtedness ratio, the management believes that sufficient taxable income will be generated from operations to absorb the deferred tax asset within the next 10 years. This estimate contemplates the utilization of the deferred tax asset up to a limit of 30% of taxable income as determined by prevailing legislation. As part of the analysis, the management reviewed the macroeconomic premises adopted in the projections, revenue growth resulting from increased traffic for each concessionaire, and annual adjustment of toll rates set forth in the concession agreements. The causes for the tax operating losses have been identified, and such losses are considered to be nonrecurring. Tax losses are primarily due to the following: • Exchange loss recorded on loans denominated in foreign currency, resulting from the Real’s devaluation in 1999; • In Rodonorte’s specific case, a 50% reduction in toll rates as established by the state government. In the second half of 2000, Rodonorte - Concessionária de Rodovias Integradas S.A. recognized deferred tax assets of R$ 28,233, substantially related to prior periods’ tax losses. Such deferred tax assets had not been recognized prior to 2000 since there was no expectation of future taxable income due to an unilateral action by the State of Paraná government to reduce toll rates beginning July 1998. However, on March 22, 2000, toll rates were reviewed and the rates established in the concession agreement were reinstated to the extent. Estimates of expected future taxable income were revised and demonstrated the Company’s ability to absorb prior periods’ tax operating losses and was recorded the deferred assets.

14. UNILATERAL REDUCTION OF TOLL RATE On July 20, 1998, the government of the state of Paraná unilaterally reduced by 50% the toll rates charged by Rodonorte under its concession agreement, as well as those of other concessionaires operating under the Paraná State Highway Concessions Program. Holding that this unilateral action had adversely affected the economic-financial equilibrium on which the Rodonorte concession was based, Rodonorte, along with the other concessionaires, took legal action against the state of Paraná, the Federal Government and the state of Paraná Highway Department, seeking to restore the economic-financial equilibrium. As part of its legal action, Rodonorte obtained an injunction from the Federal Court on August 28, 1998, which suspended Rodonorte's obligation to make investments under the concession agreement. On December 17, 1999, Rodonorte and the other concessionaires obtained preliminary injunctive relief (“tutela antecipada”) for restoration of the original toll rate, adjusted for inflation. The state of Paraná appealed the decision of December 17, 1999, without success. On March 3, 2000, Rodonorte and the state of Paraná reached a settlement in which the toll

CCR Companhia de Concessões Rodoviárias | Appendix IX rates on light vehicles were restored. Toll rates for all heavy vehicles with more than two axles continued to carry an 18% discount. This 18% discount continues in effect. As compensation for the reduction in heavy vehicle toll rates and the past reduction in toll rates generally, Rodonorte was allowed to reduce its investments in the highway. On March 24, 2000, the federal court of Parana state approved the action but, on May 18, 2000, the attorney general office of Parana state filed an appeal seeking to (a) annul the action alleging that the attorney general office did not have the opportunity of participating in the action, as required by law; or (b) toll rate reduction of 50% as previously determined. Until this appeal is judged, the terms of the action will cease to have effect. The toll rates are being collected based on the agreement made with the state of Parana on May 3, 2000.

15. SUMMARY OF THE DIFFERENCES BETWEEN BRAZILIAN CORPORATE LAW METHOD AND U.S. GAAP The Company’s accounting policies comply with generally accepted accounting principles as prescribed by Brazilian Corporate Law (“Corporate Law Method”). Accounting policies that differ significantly from generally accepted accounting principles in the United States of America (“U.S. GAAP”) are described below: Different criteria for capitalizing and amortizing capitalized interest Under the Corporate Law Method the Company has not capitalized any interest incurred during the construction period of its construction in progress. Under U.S. GAAP, in accordance with the provisions of U.S. Statement of Financial Accounting Standards “SFAS” No. 34 - “Capitalization of Interest Costs”, interest incurred on borrowings is capitalized to the extent that borrowings do not exceed construction-in-progress. In years where total borrowings exceed total construction-in-progress, capitalized interest is reduced proportionately. The credit is a reduction of interest expense. Under U.S. GAAP, the amount of interest capitalized excludes the foreign exchange gains and losses on foreign currency borrowings. The annual effects of the different criteria for capitalizing and amortizing capitalized interest are presented below: 2001 2000 1999 R$ R$ R$ Capitalized interest difference: U.S. GAAP capitalized interest in the year: Interest that would have been capitalized and credited to income under U.S. GAAP 53,161 36,282 22,671 Interest capitalized under the Corporate Law Method - - - U.S. GAAP difference 53,161 36,282 22,671

Amortization of capitalized interest difference in the year: Corporate Law Method - - - U.S. GAAP (5,442) (2,804) (1,101) U.S. GAAP difference (5,442) (2,804) (1,101)

Different criteria for accounting for the concession right and concession fee obligation Under the Corporate Law Method the Company recognized the concession right acquired from the conceding authority and the related concession fee obligation at stated value. Under U.S. GAAP, in conformity with the APB 21 "Interest on receivables and payables", the initial amount of the concession fee obligation and the related concession right acquired would be recorded on a present value basis. Under U.S. GAAP the amount recorded at present value would have been R$ 605,060 lower than the amount initially recorded under the Corporate Law Method. In subsequent periods, because the initial amount recorded is different, the amounts related to monetary adjustment of the concession fee obligation and amortization of the concession right would also differ under U.S. GAAP. There would also be a periodic interest expense charge to recognize the present value of the concession fee obligation at each period end. The annual effects of the different criteria would be as follows: 2001 2000 1999 R$ R$ R$ Monetary adjustment recorded: Under Corporate Law Method (179,998) (166,173) (303.312) Under U.S. GAAP (113,719) (102,730) (190.741) U.S. GAAP difference 66,279 63,443 112.571

Interest expense on concession fee obligation: Under Corporate Law Method - - - Under U.S. GAAP (66,032) (61,951) (54.256) U.S. GAAP difference (66,032) (61,951) (54.256)

Amortization of concession right: Under Corporate Law Method (123,040) (123,040) (123.040) Under U.S. GAAP (93,153) (93,153) (93.153) U.S. GAAP difference 29,887 29,887 29.887

Disclosure requirements U.S. GAAP disclosure requirements differ from those required by the Corporate Law Method. However, in these Corporate Law Method financial statements, the level of disclosure has been expanded to comply with U.S. GAAP. Cash and cash equivalents Under Brazilian Corporate Law, highly liquid investments with maturities of less than three months are recorded as short-term investments. Under U.S. GAAP, these investments are recorded together with cash and banks under the caption "cash and cash equivalents". The December 31, 2001 balance of cash and cash equivalents and short-term investments under U.S. GAAP is R$ 56,929 (2000 - R$ 67,196) and R$ 10,588 (2000 - R$ 4,345), respectively. Interest income (expense) Under the Corporate Law Method interest income (expense), including foreign exchange and monetary variations, is required to be shown as part of operating income. Under U.S. GAAP, such interest income (expense) would be shown after operating income. Employees’ profit sharing The Corporate Law Method requires employees’ profit sharing to be shown as an appropriation of net income for the year. Under U.S. GAAP employee profit sharing is included as an expense in arriving at operating income. Permanent assets The Corporate Law Method has a class of assets called permanent assets. This is the collective name for all assets on which indexation adjustments were calculated in the corporate and fiscal law accounts of Brazilian companies through 1995. Under U.S. GAAP the assets in this classification would be noncurrent assets and property and equipment. Under the Corporate Law Method gains and losses on the disposal of permanent assets are classified as nonoperating income (expenses). Under U.S. GAAP, gains and losses on the disposal of permanent assets are classified as part of operating income.

Appendix X | Annual Report 2001 Loss per share The Corporate Law Method computation of earnings per share is based on shares outstanding at year-end and does not distinguish between common and preferred shares. No earnings per share amounts have been computed for 1999 since the present capital structure of the Company did not exist during this period. Under U.S. GAAP Statements of Financial Accounting Standards (SFAS) No. 128, “Earnings per Share”, the computation is based on the weighted average number of common shares outstanding during the year. The Company does not have any potentially dilutive securities. Deferred taxes Under Brazilian Corporate Law, the Company records deferred income tax on temporary differences between tax books and accounting books. The deferred income tax is net of provision for loss if required. A provision for loss is recorded when management considers realization improbable. The accounting principles from Brazilian Corporate Law are in accordance with SFAS No. 109 "Accounting for Income Taxes", as mentioned below. Additionally, deferred income tax is stated at gross amount. Under U.S. GAAP, deferred income tax is stated at the net amount and not at the gross amount. Additionally, for U.S. GAAP purposes, deferred income tax asset and liability is recorded in current and long-term based on the classification of the asset and liability that generates the temporary difference. Valuation of long-lived assets For U.S. GAAP purposes, the Company follows SFAS No. 121, “Accounting for the Impairment of Long-lived Assets and for Long-lived Assets to Be Disposed Of”. In accordance with this standard, the Company periodically evaluates the carrying value of long-lived assets to be held and used, when events and circumstances warrant such a review. The carrying value of long- lived assets is considered impaired when the expected undiscounted cash flow from such assets is less than their carrying value. In that event, a loss is recognized based on the amount by which the carrying value exceeds the fair market value of the assets. The application of this standard has not had an effect on the Company’s results of operations or financial position. The Corporate Law Method does not require cash flow computations in order to determine potential asset impairment. Deferred charges Under the Corporate Law Method, the Company capitalized expenses related to the start-up of its operation and is amortizing them on a straight-line basis over a period of five years. Under U.S. GAAP, start-up costs are charged to operations in the period incurred in accordance with SOP No. 98-5, “Reporting on the Costs of Start-Up Activities”. Minority interest Under the Corporate Law Method, the Company has attributed to its minority shareholders their full share of losses for the period, where applicable. Under U.S. GAAP, minority shareholders bear their share of losses only to the extent of their share of net assets. In these situations, when a subsidiary's cumulative loss is large enough to eliminate the minority interest, the balance of the loss is reflected as part of the consolidated net loss attributable to the parent. Net loss reconciliation of the differences between U.S. GAAP and the Corporate Law Method: 2001 2000 1999 R$ R$ R$ As reported on the accompanying financial statements (125,389) (84,629) (288,688) Different criteria for: Capitalized interest 53,161 36,282 22,671 Amortization of capitalized interest (5,442) (2,804) (1,101) Deferred charges (2,009) - - Reversal - amortization of deferred charges 8,926 11,662 11,694 Monetary adjustment on concession fee obligation 66,279 63,443 112,571 Interest expense on concession fee obligation (66,032) (61,951) (54,256) Amortization of concession right 29,887 29,887 29,887 Deferred tax effects of the above adjustments (27,974) (25,251) (40,083) Minority interests 1,946 6,259 (9,042) U.S. GAAP net loss (66,647) (27,102) (216,347)

Basic EPS computation Loss attributable to common shareholders (66,647) (27,102) (216,347) Basic EPS (1.81) (3.79) (6.73) Weighted average common shares outstanding 36,875,341 32,167,737 32,167,737 The basis EPS calculation for 2000 and 1999 have been restated from the amount previously reported to give retroactive effect to the 9 for 1 stock split of common shares that occurred on November 28, 2001 and to correct the amount of loss attributable to common shareholders. Shareholders’ equity (deficit) reconciliation of the differences between U.S. GAAP and the Corporate Law Method: 2001 2000 R$ R$ As reported on the accompanying financial statements (130,466) (72,081) Different criteria for: Capitalized interest 132,816 79,655 Amortization of capitalized interest (10,365) (4,923) Reversal of deferred charges (14,823) (21,740) Accumulated monetary adjustment on concession fee obligation 252,179 185,900 Accumulated interest expense on concession fee obligation (217,997) (151,965) Accumulated reduction in amortization of concession right expense 110,831 80,944 Deferred tax effects of the above adjustments (83,372) (55,398) Minority interest (837) (2,783) U.S. GAAP shareholders’ equity 37,966 37,609

Supplementary information under U.S. GAAP: Total assets 2,903,606 2,545,573 Current liabilities 485,137 539,344 Noncurrent liabilities 2,373,235 1,968,620 Net property and equipment 2,591,572 2,251,169

Statements of changes in shareholders’ equity in accordance with U.S. GAAP for the years ended December 31, 2000 and 2001. R$ Balance at December 31, 1999 64,711 Net loss (27,102) Balance at December 31, 2000 37,609 Capital increase 67,004 Net loss (66,647) Balance at December 31, 2001 37,966

CCR Companhia de Concessões Rodoviárias | Appendix XI 16. NEW ACCOUNTING PRONOUNCEMENTS In June 1998, the FASB issued Statement of Financial Accounting Standards No. 133, “Accounting for Derivative Instruments and Hedging Activities” (SFAS 133), which establishes accounting and reporting standards for derivative instruments and for hedging activities by requiring that all derivatives be recognized in the balance sheet and measured at fair value. SFAS 133 requires that the changes in the derivative’s fair value be recognized currently in earnings unless specific hedge accounting criteria are met. During June 2000, the FASB issued Statement of Financial Accounting Standards No. 138 (SFAS 138), which amended SFAS 133 for certain derivative instruments and certain hedging activities. SFAS 133, as amended, is effective for fiscal years beginning after June 15, 2000 and should not be retroactively applied to financial statements of prior periods. The Company adopted SFAS 133, as amended, on January 1, 2001. The implementation of SFAS 133 did not have a material impact on the Company's results of operations and financial position. In June 2001, the FASB issued Statement No. 141, “Business Combinations”, Statement No. 142, “Goodwill and Intangible Assets”, and Statement No. 143, “Accounting for Asset Retirement Obligations”. SFAS 141 addresses issues concerning financial reporting for business combinations. It is effective for all business combinations initiated after June 30, 2001, and requires all business combinations thereafter to be accounted for by the purchase method. Prior business combinations accounted for by the pooling method are not affected by SFAS 141. SFAS 141 will not affect the Company’s results of operations and financial position for business combinations prior to July 1, 2001. SFAS 142 addresses issues regarding the financial accounting and reporting for acquired goodwill and other intangible assets. It addresses accounting issues regarding intangibles that are acquired individually or with a group of other assets that are not acquired in a business combination. It also addresses accounting issues that arise subsequent to the initial recognition of goodwill and other intangible assets in the financial statements. Goodwill and other intangible assets that have indefinite useful lives will not be amortized but will be tested at least annually for impairment. Intangible assets with finite lives will continue to be amortized over their useful lives but without the arbitrary 40 year maximum period. The effective date of SFAS 142 is for fiscal years beginning after December 15, 2001. The effects of SFAS 142 on the Company’s results of operations and financial position with respect to recorded intangible assets are being evaluated by the Company. SFAS 143 addresses issues related to the financial accounting and reporting for obligations associated with the retirement of tangible long-lived assets and the associated asset retirement costs. It applies to all entities and requires that the fair value of a liability for an asset retirement obligation be recognized in the period in which it is incurred if a reasonable estimate of fair value can be made. The associated asset retirement costs are capitalized as part of the carrying amount of the related long-lived asset. The effective date of SFAS 143 is for fiscal years beginning after June 15, 2002. The Company does not believe that the adoption of SFAS 143 will have a significant impact on its financial statements. In October 2001, the FASB approved Statement No. 144, “Accounting for the Impairment or Disposal of Long-Lived Assets”, which replaces Statement No. 121, “Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed of”. The Statement is intended to develop one accounting model, based on the framework established in SFAS 121, for long- lived assets to be disposed of by sale and to address significant implementation issues. SFAS 144 requires that long-lived assets to be disposed of by sale be measured at the lower of carrying amount or fair value less cost to sell, whether reported in continuing operations or in discontinued operations. Discontinued operations will no longer be measured at net realizable value or include amounts for operating losses that have not yet occurred. It is effective for financial statements issued for fiscal years beginning after December 15, 2001. The Company does not believe that the adoption of SFAS 144 will have a significant impact on its financial statements.

Appendix XII | Annual Report 2001

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